Document:

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                                                                    EXHIBIT 4.2

                      EQUITY REGISTRATION RIGHTS AGREEMENT

                                   DATED AS OF

                                 JANUARY 2, 2002

                                  BY AND AMONG

                             ALDERWOODS GROUP, INC.

                                       AND

                            THE PERSONS LISTED ON THE
                         SIGNATURE PAGES ATTACHED HERETO

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                                TABLE OF CONTENTS

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ARTICLE I.        DEFINITIONS AND CERTAIN INTERPRETATIVE MATTERS.................................................1

         1.1      Definitions....................................................................................1

         1.2      Certain Interpretative Matters.................................................................4

ARTICLE II.       SHELF REGISTRATION.............................................................................4

         2.1      Filing of Shelf Registration Statement.........................................................4

         2.2      Underwriting Procedures........................................................................4

ARTICLE III.      DEMAND REGISTRATION............................................................................6

         3.1      Right to Demand Registration...................................................................6

         3.2      Blackout Period................................................................................6

         3.3      Effective Demand Registrations.................................................................7

         3.4      Revocation of Demand Registration..............................................................7

         3.5      Continuous Effectiveness of Registration Statement.............................................8

         3.6      Underwritten Demand Registration...............................................................8

ARTICLE IV.       PIGGYBACK REGISTRATION.........................................................................8

         4.1      Right to Piggyback.............................................................................8

         4.2      Priority on Piggyback Registrations............................................................8

ARTICLE V.        RESTRICTIONS ON SALE...........................................................................9

ARTICLE VI.       PROCEDURES AND EXPENSES........................................................................9

         6.1      Registration Procedures........................................................................9

         6.2      Information from Stockholder..................................................................13

         6.3      Suspension of Disposition.....................................................................14

         6.4      Registration Expenses.........................................................................14

ARTICLE VII.      INDEMNIFICATION...............................................................................15

         7.1      Indemnification by the Company................................................................15

         7.2      Indemnification by Holders....................................................................16

         7.3      Conduct of Indemnification Proceedings........................................................16

         7.4      Contribution, etc.............................................................................17

ARTICLE VIII.     RULE 144......................................................................................18

ARTICLE IX.       MISCELLANEOUS.................................................................................18
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                                TABLE OF CONTENTS
                                   (continued)

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         9.1      Notices.......................................................................................18

         9.2      Assignment....................................................................................18

         9.3      No Third-Party Beneficiaries..................................................................19

         9.4      Entire Agreement..............................................................................19

         9.5      Amendment and Waiver..........................................................................19

         9.6      Headings......................................................................................19

         9.7      Severability..................................................................................19

         9.8      Governing Law.................................................................................19

         9.9      Specific Performance..........................................................................19

         9.10     Further Assurances............................................................................19

         9.11     Counterparts..................................................................................19
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                      EQUITY REGISTRATION RIGHTS AGREEMENT

         This EQUITY REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT"), dated as
of January __, 2002 (the "EFFECTIVE DATE"), is made by and among Alderwoods
Group, Inc., a Delaware corporation (the "COMPANY"), and Angelo Gordon & Co.,
Franklin Mutual Advisers, LLC, GSCP Recovery Inc., GSC Recovery II, L.P. and
Oaktree Capital Management, LLC, as agent and on behalf of certain funds and
accounts, (each a "STOCKHOLDER" and collectively, the "STOCKHOLDERS").

                                    RECITALS

         A. The Company, its parent corporation, The Loewen Group Inc.,
and certain of their debtor subsidiaries have filed with the United States
Bankruptcy Court in the District of Delaware the Fourth Amended Joint Plan of
Reorganization of Loewen Group International, Inc., Its Parent Corporation and
Certain of Their Debtor Subsidiaries, dated as of September 10, 2001 (the
"PLAN").

         B. Pursuant to the Plan and the transactions contemplated
thereby, each of the Stockholders has become the Beneficial Owner (as defined
below) of shares of common stock, par value $0.01 per share, of the Company
("NEW COMMON STOCK").

         C. In accordance with the terms of the Plan, the Company desires
to provide for the registration of the sale by the Stockholders and certain of
their transferees of the Registrable Securities (as defined below) from time to
time, on the terms and subject to conditions set forth below.

                                   AGREEMENTS

         NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements herein contained, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:

           Article I. DEFINITIONS AND CERTAIN INTERPRETATIVE MATTERS

     1.1 DEFINITIONS. For purposes of this Agreement, the following terms have
the following meanings:

         (a) "ADVICE": As defined in SECTION 6.3.

         (b) "AFFILIATE": As defined in Rule 12b-2 under the Exchange Act.

         (c) "AGREEMENT": As defined in the introductory paragraph hereof.

         (d) "BENEFICIAL OWNER" or "BENEFICIAL OWNERSHIP": As defined in Rule
13d-3 under the Exchange Act.

         (e) "BUSINESS DAY": Any day, other than a Saturday or Sunday, on which
national banking institutions in New York, New York, are required to be open.

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         (f) "COMPANY": As defined in the introductory paragraph hereof.

         (g) "EFFECTIVE DATE": As defined in the introductory paragraph hereof.

         (h) "EXCHANGE ACT": The Securities Exchange Act of 1934, as amended.

         (i) "HOLDERS": The Stockholders holding Registrable Securities and the
Permitted Transferees holding Registrable Securities.

         (j) "INDEMNIFIED PARTY": As defined in SECTION 7.3.

         (k) "INDEMNIFYING PARTY": As defined in SECTION 7.3.

         (l) "LOSSES": As defined in SECTION 7.1.

         (m) "NASDAQ": The Nasdaq Stock Market, Inc.

         (n) "NEW COMMON STOCK": As defined in RECITAL B.

         (o) "OTHER HOLDERS": As defined in SECTION 4.2.

         (p) "PERMITTED TRANSFEREE": As determined with respect to each transfer
of Registrable Securities, any Person who (i) acquires from a Holder, in a
single transfer made in compliance with all applicable securities laws, either
(A) all of such Holder's Registrable Securities or (B) not less than 25% of such
Holder's Registrable Securities and, as a result of such transfer, has
Beneficial Ownership of 5% or more of the shares of New Common Stock then
outstanding and (ii) agrees to be bound by the terms of this Agreement;
PROVIDED, HOWEVER, that, as determined with respect to each transfer of
Registrable Securities, a Person shall also be a "Permitted Transferee" if such
Person (x) acquires from a Stockholder, in a single transfer made in compliance
with all applicable securities laws, not less than 25% of the Registrable
Securities issued to such Stockholder on the Effective Date pursuant to the
Plan, as adjusted for any securities paid, issued or distributed on such
Stockholder's Shares as contemplated by SECTION 1.1(v)(ii), and (y) agrees to be
bound by the terms of this Agreement.

         (q) "PERSON": Any individual, corporation, general or limited
partnership, limited liability company, joint venture, trust or other entity or
association, including without limitation any governmental authority.

         (r) "PIGGYBACK NOTICE": As defined in SECTION 4.1.

         (s) "PIGGYBACK REGISTRATION": As defined in SECTION 4.1.

         (t) "PLAN": As defined in RECITAL A.

         (u) "PROSPECTUS": With respect to any Registration Statement: if Rule
434 under the Securities Act is relied on, the term sheet that is first filed
pursuant to Rule 424(b)(7) under the Securities Act, together with the
preliminary prospectus identified therein that such term sheet supplements; if
Rule 434 under the Securities Act is not relied on, the prospectus first

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filed with the SEC pursuant to Section 424(b) under the Securities Act; and if
Rule 434 under the Securities Act is not relied on and no prospectus is required
to be filed pursuant to Rule 424(b) under the Securities Act, the prospectus
included in such Registration Statement at the time when it is or was declared
effective; in each case, as amended or supplemented by any prospectus
supplement, all other amendments and supplements to such prospectus (including
post-effective amendments), and all exhibits and all material incorporated by
reference or deemed to be incorporated by reference in such prospectus.

         (v) "REGISTRABLE SECURITIES": (i) The Shares and (ii) any securities
paid, issued or distributed in respect of any of the Shares by way of stock
dividend, stock split or distribution, or in connection with a combination of
shares, recapitalization, reorganization, merger or consolidation, or otherwise;
PROVIDED, HOWEVER, that as to any Registrable Securities, such securities will
irrevocably cease to constitute "Registrable Securities" if: (A) such securities
are disposed of pursuant to an effective registration statement under the
Securities Act; (B) such securities are distributed to the public pursuant to
Rule 144; (C) such securities have been transferred to any Person other than a
Permitted Transferee; or (D) such securities cease to be outstanding.

         (w) "REGISTRATION EXPENSES": As defined in SECTION 6.4.

         (x) "REGISTRATION STATEMENT": Any registration statement of the Company
under the Securities Act that covers any of the Registrable Securities pursuant
to the provisions of this Agreement, including the related Prospectus, all
amendments and supplements to such registration statement (including
post-effective amendments), and all exhibits and all materials incorporated by
reference or deemed to be incorporated by reference in such registration
statement.

         (y) "RULE 144": Rule 144 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.

         (z) "SEC": The Securities and Exchange Commission.

         (aa) "SECURITIES ACT": The Securities Act of 1933, as amended.

         (bb) "SHARES": The shares of New Common Stock issued to the
Stockholders pursuant to the Plan.

         (cc) "SHELF REGISTRATION STATEMENT": As defined in SECTION 2.1.

         (dd) "STOCKHOLDER": As defined in the introductory paragraph hereof.

         (ee) "UNDERWRITTEN REGISTRATION" or "UNDERWRITTEN OFFERING": A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.

         (ff) "UNDERWRITTEN OFFERING NOTICE": As defined in SECTION 2.2(a).

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         1.2 CERTAIN INTERPRETATIVE MATTERS. Unless the context otherwise
requires, (a) all references to Articles or Sections are to Articles or Sections
of this Agreement, (b) each term defined in this Agreement has the meaning
assigned to it, (c) all uses of "herein," "hereto," "hereof" and words similar
thereto in this Agreement refer to this Agreement in its entirety, and not
solely to the Article, Section or provision in which it appears, (d) "or" is
disjunctive but not necessarily exclusive, and (e) words in the singular include
the plural and vice versa.

                         Article II. SHELF REGISTRATION

     2.1 FILING OF SHELF REGISTRATION STATEMENT. On or before the later to occur
of (x) the date that is 60 calendar days after the Effective Date and (y) April
1, 2002, the Company will file with the SEC a Registration Statement covering
the resale of the Registrable Securities by the Stockholders on a continuous
basis pursuant to Rule 415 under the Securities Act (the "SHELF REGISTRATION
STATEMENT") on Form S-1. The Company will use its reasonable best efforts to
cause the Shelf Registration Statement (a) to be declared effective under the
Securities Act within 90 calendar days after the date such Shelf Registration
Statement is initially filed with the SEC and (b) once effective, to remain
continuously effective for a period ending on the earlier of: (i) the first date
on which there ceases to be any Registrable Securities; and (ii) the second
anniversary of the date on which the SEC declares such Shelf Registration
Statement effective (subject to extension pursuant to ARTICLE V or SECTION 6.3).
The Company will not register any securities other than Registrable Securities
pursuant to the Shelf Registration Statement; PROVIDED, HOWEVER, that, as
contemplated by the Debt Registration Rights Agreement, dated even date
herewith, among the Company and the Stockholders, the Company will be permitted
to register pursuant to the Shelf Registration Statement debt securities of the
Company issued to the Stockholders pursuant to the Plan. The plan of
distribution contained in the Shelf Registration Statement shall permit
Underwritten Offerings. The Company will be permitted to file on Form S-3 a
post-effective amendment to the Shelf Registration Statement, or take such other
action as may be necessary to convert the Shelf Registration Statement from Form
S-1 to Form S-3, at such time the Company becomes eligible, in its sole
discretion, to use Form S-3.

     2.2 UNDERWRITING PROCEDURES.

         (a) If Holders of at least 10% of the Registrable Securities so request
in writing, the Company will effect pursuant to the Shelf Registration Statement
an Underwritten Offering; PROVIDED, HOWEVER, that the Company will not be
required to take any action in response to any such request:

             (i)   if prior to the date of such request the Company has effected
                   three Underwritten Offerings pursuant to this SECTION 2.2(a);

             (ii)  if the Company has effected an Underwritten Offering
                   pursuant to this SECTION 2.2(a) within the 120-day period
                   next preceding such request; or

             (iii) if the Registrable Securities requested to be included in
                   the Underwritten Offering have a then-current market value
                   of less than $10.0 million.

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The Company will give written notice (an "UNDERWRITTEN OFFERING NOTICE") of the
proposed Underwritten Offering to all Holders within 15 calendar days after
receipt of a valid written request for an Underwritten Offering pursuant to this
SECTION 2.2(a). Such notice will offer the Holders the opportunity to include in
such Underwritten Offering such amount of Registrable Securities as each Holder
may request. The Company will include in such Underwritten Offering all
Registrable Securities for which the Company has received written requests for
inclusion within 15 calendar days after delivery of the Underwritten Offering
Notice, subject to SECTION 2.2(b).

         (b) The Company will cause the managing underwriter or underwriters of
a proposed Underwritten Offering to permit the Holders that have requested
Registrable Securities to be included in the Underwritten Offering to include
all such Registrable Securities on the same terms and conditions as all other
Registrable Securities to be included. Notwithstanding the foregoing, if the
managing underwriter or underwriters of such Underwritten Offering advises the
Company and the selling Holders that the total amount of Registrable Securities
that such Holders propose to include in such Underwritten Offering is such as to
materially and adversely affect the success of such Underwritten Offering, then
the Company will include in such Underwritten Offering up to the full amount of
Registrable Securities requested to be included in such Underwritten Offering by
the Holders (allocated PRO RATA among the Holders on the basis of the amount of
Registrable Securities requested to be included therein by each such Holder) so
that the total amount of Registrable Securities to be included in such
Underwritten Offering is the full amount that, in the written opinion of such
managing underwriter or underwriters, can be sold without materially and
adversely affecting the success of such Underwritten Offering.

         (c) Any Registrable Securities may be withdrawn from a proposed
Underwritten Offering at any time before the execution and delivery by such
Holder of the underwriting agreement relating to such Underwritten Offering. In
the event that all Holders withdraw all of their Registrable Securities from a
proposed Underwritten Offering before the execution and delivery of an
underwriting agreement relating to such Underwritten Offering, either (i) the
Holders withdrawing their Registrable Securities shall reimburse the Company for
all of its out-of-pocket expenses incurred in connection with the proposed
Underwritten Offering in excess of the amount of expenses relating solely to the
maintenance of the Shelf Registration Statement or (ii) the requested
Underwritten Offering will be deemed to have been effected for purposes of
SECTION 2.2(a); PROVIDED, HOWEVER, that if such withdrawal was based on the
Company's failure to comply in any material respect with its obligations
hereunder, such reimbursement will not be required and the requested
Underwritten Offering will not be deemed to have been effected for purposes of
SECTION 2.2(a).

         (d) The managing underwriter or underwriters of the Underwritten
Offering relating thereto will be selected by the Holders of at least a majority
of the Registrable Securities proposed to be included in such Underwritten
Offering, subject to the approval of the Company (which approval shall not be
unreasonably withheld or unreasonably delayed).

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                        Article III. DEMAND REGISTRATION

     3.1 RIGHT TO DEMAND REGISTRATION. From and after the date that is 120
calendar days subsequent to the last day that the Shelf Registration Statement
is effective, if any Holder requests in writing that the Company effect the
registration of all or part of such Holder's or Holders' Registrable Securities
with the SEC under and in accordance with the provisions of the Securities Act
(which written request will specify the aggregate number of shares of
Registrable Securities requested to be registered and the means of
distribution), the Company will file a Registration Statement covering such
Holder's or Holders' Registrable Securities requested to be registered as
promptly as practicable (and, in any event within 60 calendar days) after
receipt of such request; PROVIDED, HOWEVER, that the Company will not be
required to take any action pursuant to this ARTICLE III:

         (a) if the Holder or Holders making such respect are not Affiliates of
the Company at the time such request is made;

         (b) if prior to the date of such request the Company has effected three
registrations pursuant to this ARTICLE III;

         (c) if the Company has effected a registration contemplated by this
ARTICLE III within the 120-day period next preceding such request;

         (d) if a shelf registration is effective at the time such request is
made pursuant to which the Holder or Holders that requested registration could
effect the disposition of such Holder's or Holders' Registrable Securities in
the manner requested and the Company offered, in accordance with the procedures
set forth herein, to include or did include such Holder's or Holders'
Registrable Securities in such shelf registration;

         (e) if the Registrable Securities requested to be registered shall have
a then-current market value of less than $10.0 million; or

         (f) during the pendency of any Blackout Period.

     3.2 BLACKOUT PERIOD.

         (a) If (i) at any time during which Holders may request a registration
pursuant to SECTION 3.1, the Company files or proposes to file a registration
statement with respect to an offering of equity securities of the Company for
its own account and (ii) with reasonable prior notice (A) the Company (in the
case of an offering that is not an Underwritten Offering) advises the Holders in
writing that the Board of Directors of the Company has determined, in the good
faith exercise of its reasonable business judgment, that a sale or distribution
of Registrable Securities would adversely affect such offering or (B) the
managing underwriter or underwriters, if any, advise the Company in writing (in
which case the Company will notify the Holders) that a sale or distribution of
Registrable Securities would adversely affect such offering, then the Company
will not be obligated to effect the initial filing of a Registration Statement
pursuant to SECTION 3.1 during the 30 calendar days prior to the date the
Company in good faith estimates (as certified in writing by an officer of the
Company to the Holders following a request for

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registration pursuant to SECTION 3.1) will be the date of the filing of, and
ending on the date which is 90 calendar days following the effective date of,
such registration statement.

         (b) If the Board of Directors of the Company determines, in the good
faith exercise of its reasonable business judgment, that the registration and
distribution of Registrable Securities (i) would materially impede, delay or
interfere with any financing, acquisition, corporate reorganization or other
significant transaction involving the Company or (ii) would require disclosure
of non-public material information, the disclosure of which would materially and
adversely affect the Company, the Company will promptly give the Holders written
notice of such determination and will be entitled to postpone the filing or
effectiveness of a Registration Statement for a reasonable period of time not to
exceed 90 calendar days; PROVIDED, HOWEVER, that the Company will deliver to the
Holder or Holders that have requested registration a general statement, signed
by an officer of the Company, of the reasons for such postponement or
restriction on use and an estimate of the anticipated delay. The Company will
promptly notify such Holders of the expiration or earlier termination of such a
period.

         (c) Notwithstanding anything in this SECTION 3.2 to the contrary, there
will be no more than one delay period as contemplated by this SECTION 3.2 during
any consecutive 12-month period during the time in which Holders may request a
registration pursuant to SECTION 3.1.

     3.3 EFFECTIVE DEMAND REGISTRATIONS.

         (a) The Company may satisfy its obligations under SECTION 3.1 by
amending (to the extent permitted by applicable law) any registration statement
previously filed by the Company under the Securities Act so that such amended
registration statement will permit the disposition (in accordance with the
intended methods of disposition specified as aforesaid) of all of the
Registrable Securities for which a demand for registration has been properly
made under SECTION 3.1. If the Company so amends a previously filed registration
statement, it will be deemed to have effected a registration for purposes of
SECTION 3.1.

         (b) Except as provided in SECTION 3.4, a registration requested
pursuant to SECTION 3.1 will not be deemed to be effected for purposes of
SECTION 3.1 if it has not been declared effective by the SEC or become effective
in accordance with the Securities Act and the rules and regulations thereunder
and kept effective as contemplated by SECTION 3.5.

     3.4 REVOCATION OF DEMAND REGISTRATION. A Holder of Registrable Securities
to be included in a Registration Statement pursuant to SECTION 3.1 may, at any
time prior to the effective date of the Registration Statement relating to such
registration, revoke its request to have Registrable Securities included therein
by providing a written notice to the Company. In the event all such Holders of
Registrable Securities revoke their request, either (i) the Holders of
Registrable Securities who revoke such request shall reimburse the Company for
all its out-of-pocket expenses incurred in the preparation, filing and
processing of the Registration Statement or (ii) the requested registration that
has been revoked will be deemed to have been effected for purposes of SECTION
3.1; PROVIDED, HOWEVER, that, if such revocation was based on the Company's
failure to comply in any material respect with its obligations hereunder, such
reimbursement will

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not be required and the requested registration that has been revoked will not be
deemed to have been effected for purposes of SECTION 3.1.

     3.5 CONTINUOUS EFFECTIVENESS OF REGISTRATION STATEMENT. The Company will
use its reasonable best efforts to keep a Registration Statement that has become
effective as contemplated by this ARTICLE III continuously effective for a
period of 60 calendar days (subject to extension pursuant to SECTION 6.3) or
such shorter period that will terminate when all Registrable Securities covered
by such Registration Statement have been sold pursuant to such Registration
Statement; PROVIDED, HOWEVER, that in no event will such period expire prior to
the expiration of the applicable period referred to in Section 4(3) of the
Securities Act and Rule 174 promulgated thereunder.

     3.6 UNDERWRITTEN DEMAND REGISTRATION. In the event that a registration
requested pursuant to SECTION 3.1 is to be an Underwritten Registration, the
managing underwriter or underwriters of the Underwritten Offering relating
thereto will be selected by the Holders of at least a majority of the
Registrable Securities proposed to be included in such Underwritten
Registration, subject to the approval of the Company (which approval shall not
be unreasonably withheld or unreasonably delayed).

                      Article IV. PIGGYBACK REGISTRATION.

     4.1 RIGHT TO PIGGYBACK. If at any time the Company proposes to file a
registration statement under the Securities Act with respect to an offering of
any class of equity securities (other than a registration statement on Form S-4,
Form S-8 or any successor forms thereto and the Shelf Registration Statement,
but including any Registration Statement to be filed pursuant to SECTION 3.1),
whether or not for its own account, then the Company will give written notice
(the "PIGGYBACK NOTICE") of such proposed filing to the Holders at least 45
calendar days before the anticipated filing date. Such notice will offer the
Holders the opportunity to register such amount of Registrable Securities as
each Holder may request (a "PIGGYBACK REGISTRATION"). The Company will include
in each Piggyback Registration all Registrable Securities for which the Company
has received written requests for inclusion within 15 calendar days after
delivery of the Piggyback Notice, subject to SECTION 4.2. The Holders may
withdraw all or part of the Registrable Securities from a Piggyback Registration
at any time before the third calendar day immediately preceding the effective
date of such Piggyback Registration.

     4.2 PRIORITY ON PIGGYBACK REGISTRATIONS. The Company will cause the
managing underwriter or underwriters of a proposed Underwritten Offering to
permit the Holders that have requested Registrable Securities to be included in
the Piggyback Registration to include all such Registrable Securities on the
same terms and conditions as any similar securities, if any, of the Company.
Notwithstanding the foregoing, if the managing underwriter or underwriters of
such Underwritten Offering advises the Company and the selling Holder or Holders
that the total amount of securities that the Company, such Holders and any other
Persons having rights to participate in such Piggyback Registration ("OTHER
HOLDERS") propose to include in such offering is such as to materially and
adversely affect the success of such Underwritten Offering, then:

         (a) if such Piggyback Registration is a primary registration by the
Company for its own account, the Company will include in such Piggyback
Registration: (i) first, all

                                      -8-
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securities to be offered by the Company; and (ii) second, up to the full amount
of securities requested to be included in such Piggyback Registration by the
Holders and Other Holders having rights to participate in such Piggyback
Registration (allocated PRO RATA among such Holders and Other Holders on the
basis of the amount of securities requested to be included therein by each such
Holder or Other Holder) so that the total amount of securities to be included in
such Underwritten Offering is the full amount that, in the opinion of such
managing underwriter or underwriters, can be sold without materially and
adversely affecting the success of such Underwritten Offering; and

         (b) if such Piggyback Registration is an underwritten secondary
registration for the account of holders of securities of the Company, the
Company will include in such registration: (i) first, all securities of the
Persons exercising "demand" registration rights requested to be included therein
(including without limitation the Person who demands registration and any
Persons who are entitled to participate in such Piggyback Registration pursuant
to the same agreement as the Person demanding such registration); and (ii)
second, up to the full amount of securities requested to be included in such
Piggyback Registration by the Holders and Other Holders having rights to
participate in such Piggyback Registration (allocated PRO RATA among such
Holders and Other Holders on the basis of the amount of securities requested to
be included therein by each such Holder or Other Holder) so that the total
amount of securities to be included in such Underwritten Offering is the full
amount that, in the written opinion of such managing underwriter or
underwriters, can be sold without materially and adversely affecting the success
of such Underwritten Offering.

                        Article V. RESTRICTIONS ON SALE

     Each Holder whose Registrable Securities are covered by a Registration
Statement filed pursuant to ARTICLE II, III or IV hereof agrees, if such Holder
is so requested (pursuant to a timely written notice) by the managing
underwriter or underwriters in any Underwritten Offering by the Company for its
own account, not to effect any public or private sale or distribution of any
Registrable Securities (except as part of such Underwritten Offering), including
a sale pursuant to Rule 144, during the 10 calendar days prior to, and the 90
calendar days following, the closing date of such Underwritten Offering. In the
event of such a request, the Company may impose, during such period, appropriate
stop-transfer instructions with respect to the Registrable Securities subject to
such restrictions. If a request is made pursuant to this ARTICLE V, the time
period during which the Shelf Registration Statement is required to remain
continuously effective pursuant to ARTICLE II will be extended by 100 calendar
days or such shorter period that will terminate when all Registrable Securities
covered by the Shelf Registration Statement (and not included in the
Underwritten Offering) have been sold pursuant to the Shelf Registration
Statement.

                      Article VI. PROCEDURES AND EXPENSES

     6.1 REGISTRATION PROCEDURES. In connection with the Company's registration
obligations pursuant to ARTICLES II, III and IV, the Company will effect such
registrations to permit the sale of Registrable Securities by a Holder in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto the Company will as promptly as reasonably practicable:

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         (a) Prepare and file with the SEC a Registration Statement or
Registration Statements on Form S-1, Form S-3 or other appropriate form under
the Securities Act available for the sale of the Registrable Securities by the
selling Holder in accordance with the intended method or methods of distribution
thereof; PROVIDED, HOWEVER, that the Company (i) will, before filing, furnish to
the selling Holder, its counsel and the managing underwriter or underwriters, if
any, copies of the Registration Statement or Prospectus proposed to be filed,
which documents will be subject to the review of such Holder, its counsel and
such underwriters, (ii) will provide such Persons with a reasonable opportunity
to review and comment on such Registration Statement or Prospectus, and (iii)
will not file any such Registration Statement or Prospectus to which the selling
Holder, its counsel or such underwriter, if any, shall reasonably object on a
timely basis.

         (b) Prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary; cause the related
Prospectus to be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 (or any similar provision then in
force) under the Securities Act; and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with the
intended methods of disposition by the selling Holder set forth in such
Registration Statement as so amended, or in such Prospectus as so supplemented.

         (c) Promptly notify selling Holder, its counsel and the managing
underwriter or underwriters, if any, orally (with subsequent written
confirmation) (i) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the SEC or any other federal or state governmental
authority for amendments or supplements to a Registration Statement or related
Prospectus or for additional information, (iii) of the issuance by the SEC or
any other federal or state governmental authority of any stop order suspending
the effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the occurrence of any event which makes any statement made in
such Registration Statement or Prospectus untrue in any material respect or
which requires the making of any changes in a Registration Statement or
Prospectus or other documents so that, (A) in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading and (B) in the case of the Prospectus, it
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (vi) of the Company's reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.

         (d) Use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement, or the lifting
of any suspension of the qualification or exemption from qualification of any of
the Registrable Securities for sale in any jurisdiction, at the earliest
practicable date.

                                      -10-
<PAGE>

         (e) If requested by the managing underwriter or underwriters, if any,
or the selling Holder, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment such information as the managing underwriter or
underwriters, if any, and such selling Holder agree should be included therein
under applicable law and (ii) make all required filings of such Prospectus
supplement or such post-effective amendment as soon as practicable after the
Company has received notification of the matters to be incorporated in such
Prospectus supplement or post-effective amendment; PROVIDED, HOWEVER, that the
Company will not be required to take any actions under this SECTION 6.1(e) that
are not, in the opinion of counsel for the Company, in compliance with
applicable law.

         (f) Furnish to the selling Holder, its counsel and each managing
underwriter, if any, at least one conformed copy of the Registration Statement
and any post-effective amendment thereto, including financial statements (but
excluding all schedules, all documents incorporated or deemed incorporated
therein by reference and all exhibits).

         (g) Deliver to the selling Holder, its counsel and the managing
underwriter or underwriters, if any, as many copies of the Prospectus relating
to such Registrable Securities (including each preliminary Prospectus) and any
amendment or supplement thereto as such Persons may reasonably request and, by
such delivery, the Company will be deemed to have consented to the use of such
Prospectus or such amendment or supplement thereto by the selling Holder and the
underwriter or underwriters, if any, in connection with the offering and sale of
the Registrable Securities covered by such Prospectus or any amendment or
supplement thereto.

         (h) Prior to any public offering of Registrable Securities, register or
qualify, or cooperate with the selling Holder, the managing underwriter or
underwriters, if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions within the United States as
the selling Holder or underwriter or underwriters reasonably request in writing;
keep each such registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept effective;
and do any and all other acts or things reasonably necessary or advisable to
enable the disposition in such jurisdictions of the Registrable Securities
covered by the Registration Statement; PROVIDED, HOWEVER, that the Company will
not be required to (i) qualify generally to do business in any jurisdiction in
which it is not then so qualified or (ii) take any action that would subject it
to general service of process in any jurisdiction in which it is not then so
subject.

         (i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies or authorities within the United States as necessary,
except where such registration or approval is required solely as a consequence
of the nature of the selling Holder's business, in which case the Company will
use its reasonable best efforts to enable the selling Holder to make or obtain
such registration or approval and to consummate the disposition of such
Registrable Securities.

         (j) Cooperate with the selling Holder and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold, which certificates
will not bear any restrictive legends, and

                                      -11-
<PAGE>

cause such certificates to be in such denominations and registered in such names
as the managing underwriter or underwriters, if any, shall request at least two
Business Days prior to any sale of Registrable Securities to the managing
underwriter or underwriters.

         (k) As promptly as practicable upon the occurrence of any event
contemplated by SECTION 6.1(c)(v) or 6.1(c)(vi) hereof, prepare a supplement or
post-effective amendment to each Registration Statement or a supplement to the
related Prospectus, or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities being sold thereunder,
such Prospectus will not contain an untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.

         (l) Use its reasonable best efforts to cause all Registrable Securities
covered by such Registration Statement to be (i) listed on each securities
exchange, if any, on which similar securities issued by the Company are then
listed or (ii) authorized to be quoted on Nasdaq; in each case, if requested by
the managing underwriter or underwriters, if any.

         (m) Engage an appropriate transfer agent and provide such transfer
agent with printed certificates for the Registrable Securities in a form
eligible for deposit with The Depository Trust Company, and provide a CUSIP
number for the Registrable Securities.

         (n) Enter into such agreements (including, in the event of an
Underwritten Offering, an underwriting agreement in form, scope and substance as
is customary in Underwritten Offerings) and take all such other actions in
connection therewith (including those reasonably requested by the selling Holder
or, in the event of an Underwritten Offering, those reasonably requested by the
managing underwriter or underwriters) reasonably necessary or desirable to
expedite or facilitate the disposition of such Registrable Securities, and in
such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an Underwritten Registration, (i) make such
representations and warranties to the selling Holder and the managing
underwriter or underwriters, if any, with respect to the business of the Company
and its subsidiaries, the Registration Statement or Prospectus, in each case, in
form, substance and scope as are customarily made by issuers to underwriters in
Underwritten Offerings and confirm the same if and when requested, (ii) use its
reasonable best efforts to obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriter or underwriters, if any, and
the selling Holder) addressed to the selling Holder and the managing underwriter
or underwriters, if any, covering the matters customarily covered in opinions
requested in Underwritten Offerings and such other matters as may be reasonably
requested by the selling Holder and managing underwriter or underwriters, if
any, including without limitation the matters referred to in clause (i) above,
(iii) use its reasonable best efforts to obtain "comfort" letters and updates
thereof from the independent certified public accountants of the Company (and,
if necessary, any other certified public accountants of any subsidiary of the
Company or of any business acquired by the Company for which financial
statements and financial data is, or is required to be, included in the
Registration Statement), addressed to the selling Holder and each of the
managing underwriter or underwriters, if any, such letters to be in customary
form and covering matters of the type customarily covered in "comfort" letters
in connection with Underwritten Offerings, and (iv) deliver such documents and
certificates as may be reasonably

                                      -12-
<PAGE>

requested by the selling Holder, its counsel or the managing underwriter or
underwriters, if any, to evidence the continued validity of the representations
and warranties of the Company and its subsidiaries made pursuant to clause (i)
above and to evidence compliance with any customary conditions contained in the
underwriting agreement or similar agreement entered into by the Company. The
foregoing actions will be taken in connection with each closing under such
underwriting or similar agreement as and to the extent required thereunder.

         (o) Make available for inspection by a representative of the selling
Holder, any underwriter and any attorney or accountant retained by such selling
Holder or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries, and cause the
officers, directors and employees of the Company and its subsidiaries to supply
all information reasonably requested by any such representative, underwriter,
attorney or accountant in connection with such Registration Statement; PROVIDED,
HOWEVER, that any records, information or documents that are designated by the
Company in writing as confidential at the time of delivery of such records,
information or documents will be kept confidential by such Persons unless (i)
such records, information or documents are in the public domain or otherwise
publicly available (other than by reason of breach of this confidentiality
provision), (ii) disclosure of such records, information or documents is
required by court or administrative order or is necessary to respond to inquires
of regulatory authorities, or (iii) disclosure of such records, information or
documents, in the opinion of counsel to such Person, is otherwise required by
law or regulation (including without limitation pursuant to the requirements of
the Securities Act or regulations promulgated thereunder); PROVIDED, HOWEVER,
that in the case of subsections (ii) and (iii) hereof, prior to making such
disclosure the Holder will, subject to applicable law, advise and consult with
the Company and its counsel as to such disclosure and the nature and wording of
such disclosure and will use its reasonable best efforts to obtain, at the
Company's expense, confidential treatment therefor.

         (p) Comply with all applicable rules and regulations of the SEC and
make generally available to its security holders earning statements satisfying
the provisions of Section 11(a) of the Securities Act, PROVIDED that the Company
shall be deemed to have complied with this SECTION 6.1(p) if it has satisfied
the provisions of Rule 158 under the Securities Act (or any similar rule
promulgated under the Securities Act).

     6.2 INFORMATION FROM STOCKHOLDER.

         (a) The Company may require each Holder including its Registrable
Securities in any Registration Statement to furnish to the Company such
information regarding the Holder and its plan and method of distribution of such
Registrable Securities as the Company may, from time to time, reasonably request
in writing. The Company may refuse to proceed with the registration of such
Holder's Registrable Securities if such Holder unreasonably fails to furnish
such information within a reasonable time after receiving such request.

         (b) Each selling Holder will as expeditiously as possible (i) notify
the Company of the occurrence of any event that makes any statement made in a
Registration Statement or Prospectus regarding such selling Holder untrue in any
material respect or that requires the making of any changes in a Registration
Statement or Prospectus so that, in such regard, (A) in the case of a
Registration Statement, it will not contain any untrue statement of a

                                      -13-
<PAGE>

material fact or omit any material fact required to be stated therein or
necessary to make the statements not misleading and (B) in the case of a
Prospectus, it will not contain any untrue statement of a material fact or omit
any material fact required to be stated or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading and (ii) provide the Company with such information as may be required
to enable the Company to prepare a supplement or post-effective amendment to any
such Registration Statement or a supplement to such Prospectus as contemplated
by SECTION 6.1(k).

         (c) With respect to any Underwritten Offering, the inclusion of a
Holder's Registrable Securities therein will be conditioned upon the execution
and delivery by such Holder of an underwriting agreement in form, scope and
substance as is customary in Underwritten Offerings.

     6.3 SUSPENSION OF DISPOSITION. Each selling Holder will be deemed to have
agreed that, upon receipt of any notice from the Company of the occurrence of
any event of the kind described in SECTION 6.1(c)(ii), 6.1(c)(iii), 6.1(c)(iv),
6.1(c)(v) or 6.1(c)(vi), such Holder will discontinue disposition of Registrable
Securities covered by a Registration Statement or Prospectus until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
SECTION 6.1(k) or until it is advised in writing (the "ADVICE") by the Company
that the use of the applicable Prospectus may be resumed and has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus. In the event the Company shall
give any such notice, the period of time set forth in SECTION 2.1 or SECTION 3.5
will be extended by the number of days during the time period from and including
the date of the giving of such notice to and including the date when each seller
of Registrable Securities covered by such Registration Statement shall have
received (i) the copies of the supplemented or amended Prospectus contemplated
by SECTION 6.1(k) or (ii) the Advice.

     6.4 REGISTRATION EXPENSES.

         (a) Subject to SECTION 2.2(c) and 3.4, all fees and expenses incurred
by the Company in complying with ARTICLES II, III and IV and SECTION 6.1
("REGISTRATION EXPENSES") will be borne by the Company. Such fees and expenses
will include without limitation (i) all registration and filing fees (including
without limitation fees and expenses (x) with respect to filings required to be
made with the National Association of Securities Dealers, Inc. and (y) of
compliance with securities or blue sky laws (including without limitation
reasonable fees and disbursements of counsel for the underwriters and selling
Holder in connection with blue sky qualifications of the Registrable Securities
and determination of the eligibility of the Registrable Securities for
investment under the laws of such jurisdictions as the managing underwriter or
underwriters, if any, or the selling Holder may designate)), (ii) printing
expenses (including without limitation the expenses of printing certificates for
securities in a form eligible for deposit with The Depository Trust Company and
of printing Prospectuses if the printing of Prospectuses is requested by the
selling Holder), (iii) messenger, telephone and delivery expenses, (iv)
reasonable fees and disbursements of counsel for the Company, (v) reasonable
fees and disbursements of one counsel for all selling Holders and Other Holders
collectively (which counsel will be selected by Holders and Other Holders
holding a majority of the securities sought to be included in the Registration
Statement), (vi) reasonable fees and disbursements of all

                                      -14-
<PAGE>

independent certified public accountants referred to in SECTION 6.1(n)(iii)
(including the expenses of any special audit and "comfort" letters required by
or incident to such performance), (vii) reasonable fees and expenses of any
"qualified independent underwriter" or other independent appraiser participating
in an offering pursuant to Section 2720(c) of the Conduct Rules of the National
Association of Securities Dealers, Inc., and (viii) reasonable fees and expenses
of all other Persons retained by the Company. In addition, the Company will pay
its internal expenses (including without limitation all salaries and expenses of
its officers and employees performing legal or accounting duties), the expense
of any annual audit, and the fees and expenses incurred in connection with the
listing of the securities to be registered on each securities exchange, if any,
on which similar securities issued by the Company are then listed or the
quotation of such securities on Nasdaq if similar securities issued by the
Company are then quoted on Nasdaq.

         (b) Notwithstanding anything to the contrary herein contained, all
underwriting fees, discounts, selling commissions and stock transfer taxes
applicable to the sale of Registrable Securities will be borne by the Holder
owning such Registrable Securities.

         (c) Notwithstanding anything to the contrary herein contained, each
selling Holder may have its own separate counsel in connection with the
registration of any of its Registrable Securities, which counsel may participate
therein to the full extent provided herein; PROVIDED, HOWEVER, that all fees and
expenses of such separate counsel will be paid for by such selling Holder.

                          Article VII. INDEMNIFICATION

     7.1 INDEMNIFICATION BY THE COMPANY. The Company will indemnify and hold
harmless, to the fullest extent permitted by law, each Holder owning Registrable
Securities registered pursuant to this Agreement, its officers, directors,
trustees, agents and employees, each Person who controls such Holder (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act)
and the officers, directors, trustees, agents and employees of any such
controlling Person, from and against all losses, claims, damages, liabilities,
costs (including without limitation the costs of investigation and attorneys'
fees) and expenses (collectively, "LOSSES"), as incurred, arising out of or
based upon any untrue or alleged untrue statement of a material fact contained
or incorporated by reference in any Registration Statement, Prospectus or
preliminary prospectus, or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as the
same are based solely upon information furnished in writing to the Company by or
on behalf of such Holder expressly for use therein; PROVIDED, HOWEVER, that the
Company will not be liable to any Holder to the extent that any such Losses
arise out of or are based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any preliminary prospectus if either (i)
(A) such Holder failed to send or deliver a copy of the Prospectus with or prior
to the delivery of written confirmation of the sale by such Holder of a
Registrable Security to the Person asserting the claim from which such Losses
arise and (B) the Prospectus would have completely corrected such untrue
statement or alleged untrue statement or such omission or alleged omission or
(ii) such untrue statement or alleged untrue statement or such omission or
alleged omission is completely corrected in an amendment or supplement to the
Prospectus previously furnished by or on behalf of the

                                      -15-
<PAGE>

Company, such Holder was furnished with copies of the Prospectus as so amended
or supplemented, and such Holder thereafter failed to deliver such Prospectus as
so amended or supplemented prior to or concurrently with the sale of a
Registrable Security to the Person asserting the claim from which such Losses
arise.

     7.2 INDEMNIFICATION BY HOLDERS. Each Holder (severally and not jointly)
will indemnify and hold harmless, to the fullest extent permitted by law, the
Company, its officers, directors, agents and employees, each Person who controls
the Company (within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act), and the directors, officers, agents and employees of
any such controlling Person, from and against all Losses, as incurred, arising
out of or based upon any untrue statement of a material fact contained or
incorporated by reference in any Registration Statement, Prospectus or
preliminary prospectus, or arising out of or based upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, to the extent, but only to the extent, that such untrue
statement or omission was made in reliance upon and in conformity with
information so furnished in writing by or on behalf of such Holder to the
Company expressly for use in such Registration Statement, Prospectus or
preliminary prospectus. In no event will the liability of any Holder hereunder
be greater in amount than the dollar amount of the proceeds received by such
Holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation.

     7.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. If any Person becomes entitled
to indemnity hereunder (an "INDEMNIFIED PARTY"), such Indemnified Party will
give prompt notice to the party from which such indemnity is sought (the
"INDEMNIFYING PARTY") of any claim or of the commencement of any action or
proceeding with respect to which such Indemnified Party seeks indemnification or
contribution pursuant hereto; PROVIDED, HOWEVER, that the failure to so notify
the Indemnifying Party will not relieve the Indemnifying Party from any
obligation or liability except to the extent that the Indemnifying Party has
been prejudiced materially by such failure. If such an action or proceeding is
brought against the Indemnified Party, the Indemnifying Party will be entitled
to participate therein and, to the extent it may elect by written notice
delivered to the Indemnified Party promptly after receiving the notice referred
to in the immediately preceding sentence, to assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party. Notwithstanding the
foregoing, the Indemnified Party will have the right to employ its own counsel
in any such case, but the fees and expenses of such counsel will be at the
expense of the Indemnified Party unless (i) the employment of such counsel shall
have been authorized in writing by the Indemnifying Party, (ii) the Indemnifying
Party shall not have employed counsel (reasonably satisfactory to the
Indemnified Party) to take charge of such action or proceeding within a
reasonable time after notice of commencement thereof, or (iii) the Indemnified
Party reasonably shall have concluded that there may be defenses or actions
available to it which are different from or additional to those available to the
Indemnifying Party which, if the Indemnifying Party and the Indemnified Party
were to be represented by the same counsel, could result in a conflict of
interest for such counsel or materially prejudice the prosecution of defenses or
actions available to the Indemnified Party. If any of the events specified in
clause (i), (ii) or (iii) of the immediately preceding sentence are applicable,
then the fees and expenses of separate counsel for the Indemnified Party shall
be borne by the Indemnifying Party. If, in any case, the Indemnified Party
employs separate counsel, the Indemnifying Party will not have the right to
direct the defense of such action or

                                      -16-
<PAGE>

proceeding on behalf of the Indemnified Party. All fees and expenses required to
be paid to the Indemnified Party pursuant to this ARTICLE VII will be paid
periodically during the course of the investigation or defense, as and when
reasonably itemized bills therefor are delivered to the Indemnifying Party in
respect of any particular Loss that is incurred. Notwithstanding anything to the
contrary contained in this SECTION 7.3, an Indemnifying Party will not be liable
for the settlement of any action or proceeding effected without its prior
written consent. The Indemnifying Party will not consent to entry of any
judgment or enter into any settlement or otherwise seek to terminate any action
or proceeding in which any Indemnified Party is or could be a party and as to
which indemnification or contribution could be sought by such Indemnified Party
under this ARTICLE VII, unless such judgment, settlement or other termination
provides solely for the payment of money and includes as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party of a
release, in form and substance satisfactory to the Indemnified Party, from all
liability in respect of such claim or litigation for which such Indemnified
Party would be entitled to indemnification hereunder.

     7.4 CONTRIBUTION, ETC.

         (a) If the indemnification provided for in this ARTICLE VII is
unavailable to an Indemnified Party under SECTION 7.1 or 7.2 in respect of any
Losses or is insufficient to hold such Indemnified Party harmless, then each
applicable Indemnifying Party (severally and not jointly), in lieu of
indemnifying such Indemnified Party, will contribute to the amount paid or
payable by such Indemnified Party as a result of such Losses, in such proportion
as is appropriate to reflect the relative fault of the Indemnifying Party or
Indemnifying Parties, on the one hand, and such Indemnified Party, on the other
hand, in connection with the actions, statements or omissions that resulted in
such Losses as well as any other relevant equitable considerations. The relative
fault of such Indemnifying Party or Indemnifying Parties, on the one hand, and
such Indemnified Party, on the other hand, will be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or related to information supplied by,
such Indemnifying Party or Indemnifying Parties or such Indemnified Party, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses will be deemed to include any legal
or other fees or expenses incurred by such party in connection with any action
or proceeding.

         (b) The parties hereto agree that it would not be just and equitable if
contribution pursuant to this SECTION 7.4 were determined by PRO RATA allocation
or by any other method of allocation that does not take into account the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding anything contained in this SECTION 7.4 to the contrary, an
Indemnifying Party that is a selling Holder will not be required to contribute
any amount in excess of the amount by which the total price at which the
Registrable Securities were sold by such selling Holder to the public exceeds
the amount of any damages which such selling Holder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any Person who was not guilty of such fraudulent misrepresentation.

                                      -17-
<PAGE>

         (c) The provisions of this ARTICLE VII will survive indefinitely,
notwithstanding any transfer of the Registrable Securities by any Holder.

                             Article VIII. RULE 144

     The Company will file all reports required to be filed by it under the
Securities Act and the Exchange Act, and will cooperate with any Holder
(including without limitation by making such representations as any such Holder
may reasonably request), all to the extent required from time to time to enable
such Holder to sell Registrable Securities without registration under the
Securities Act within the limitations of the exemptions provided by Rule 144.
Upon the request of any Holder, the Company will deliver to such Holder a
written statement as to whether it has complied with such filing requirements.
Notwithstanding the foregoing, nothing in this ARTICLE VIII will require the
Company to register any securities, or file any reports, under the Exchange Act
if such registration or filing is not required under the Exchange Act.

                           Article IX. MISCELLANEOUS

     9.1 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made by
delivery in person, by courier service, by facsimile transmission or by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for a
party as shall be specified in a notice given in accordance with this SECTION
9.1):

         (a) If to the Company:

             Alderwoods Group, Inc.
             Attention:  Bradley D. Stam, Esq.
             Senior Vice President, Legal & Asset Management
             2225 Sheppard Avenue East
             11th Floor, Atria III
             Toronto, Ontario M2J 5C2
             Facsimile Number:         (416) 498-2466
             Telephone Number:         (416) 498-2462

         (b) If to a Holder, to the then-current address thereof contained in
the stock records of the Company, which initially shall be, with respect to each
Stockholder, the address thereof set forth on the signature page hereto.

All such notices and communications will be deemed to have been delivered or
given: upon delivery, if personally delivered; one Business Day after being
dispatched, if dispatched by same-day or next-day courier guaranteeing timely
delivery; when receipt acknowledged, if sent by facsimile transmission; and five
Business Days after being deposited in the mail, if mailed.

     9.2 ASSIGNMENT. Neither this Agreement nor the rights and obligations
hereunder may be assigned by operation of law or otherwise (except that this
Agreement and rights and obligations hereunder may be assigned by any Holder to
a Permitted Transferee thereof, which Permitted Transferee shall be deemed to be
a Holder and a party hereto for all purposes of this Agreement upon receipt by
the Company of such Permitted Transferee's written agreement to be

                                      -18-
<PAGE>

bound by the terms hereof). Notwithstanding the foregoing, nothing herein
contained shall restrict the right of any Holder to transfer securities of the
Company held by it.

     9.3 NO THIRD-PARTY BENEFICIARIES. This Agreement will be binding upon and
inure solely to the benefit of the parties hereto and their respective
successors and permitted assigns and nothing herein, express or implied, is
intended to or shall confer upon any other Person any legal or equitable right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.

     9.4 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof.

     9.5 AMENDMENT AND WAIVER. This Agreement may not be amended or modified or
any provision hereof waived except by an instrument in writing signed by the
Company and both (x) Holders of at least a majority of the then-outstanding
Registrable Securities and (y) each Holder of 10% or more of the
then-outstanding Registrable Securities. Notwithstanding anything contained
herein to the contrary, a waiver that does not adversely affect all of the
parties hereto may be executed by only the adversely affected party or parties.

     9.6 HEADINGS. The descriptive headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.

     9.7 SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or unenforceable under any law or public policy, all other
terms and provisions of this Agreement will nevertheless remain in full force
and effect. Upon such determination that any term or other provision is invalid,
illegal or unenforceable, the parties hereto will endeavor in good faith to
replace the invalid, illegal or unenforceable provisions with valid, legal and
enforceable provisions the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.

     9.8 GOVERNING LAW. This Agreement will be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to the
principles of conflict of laws thereof.

     9.9 SPECIFIC PERFORMANCE. The parties hereto agree that irreparable damage
would occur in the event any provision of this Agreement was not performed in
accordance with the terms hereof and that the parties will be entitled to
specify performance of the terms hereof, in addition to any other remedy at law
or equity.

     9.10 FURTHER ASSURANCES. The parties hereto will do such further acts and
things necessary to ensure that the terms of this Agreement are carried out and
observed.

     9.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed will be deemed to be an original; such
counterparts will together constitute but one agreement.

                                      -19-

<PAGE>

     IN WITNESS WHEREOF, each of the parties has executed this Agreement as of
the date first written above.

                                ALDERWOODS GROUP, INC.

                                By:    /s/ BRADLEY D. STAM
                                       -----------------------------------------
                                Name:  Bradley D. Stam
                                Title: Senior Vice President, Legal & Asset
                                       Management

                                ANGELO GORDON & CO.

                                By:    /s/ JEFFREY H. ARONSON
                                       -----------------------------------------
                                Name:  Jeffrey H. Aronson
                                Title: Authorized Signatory

                                Address: 245 Park Avenue, 26th Floor
                                         ---------------------------------------
                                         New York, NY 10167
                                         ---------------------------------------

                                FRANKLIN MUTUAL ADVISERS, LLC

                                By:    /s/ BRADLEY TAKAHASHI
                                       -----------------------------------------
                                Name:  Bradley Takahashi
                                Title: Assistant Vice President

                                Address: 51 John F. Kennedy Parkway
                                         ---------------------------------------
                                         Short Hills, NJ 07078
                                         ---------------------------------------

<PAGE>

                                GSCP RECOVERY, INC.

                                By:    /s/ ROBERT HAMWEE
                                       -----------------------------------------
                                Name:  Robert Hamwee
                                Title: Managing Director

                                Address: 500 Campus Drive
                                         ---------------------------------------
                                         Florham Park, NJ 07932
                                         ---------------------------------------

                                GSC RECOVERY II, L.P.

                                By: GSC Recovery II GP, L.P.,
                                     its general partner

                                  By: GSC RII, LLC,
                                       its general partner

                                     By: GSCP (NJ) Holdings, L.P.,
                                          its sole member

                                         By: GSCP (NJ), Inc.,
                                              its general partner

                                            By:    /s/ ROBERT HAMWEE
                                                   -----------------------------
                                            Name:  Robert Hamwee
                                            Title: Managing Director

                                            Address: 500 Campus Drive
                                                     ---------------------------
                                                     Florham Park, NJ 07932
                                                     ---------------------------

<PAGE>

                                OAKTREE CAPITAL MANAGEMENT, LLC,
                                as agent on behalf of certain funds and accounts

                                By:    /s/ KENNETH LIANG
                                       -----------------------------------------
                                Name:  Kenneth Liang
                                Title: Managing Director

                                By:    /s/ LOWELL W. HILL
                                       -----------------------------------------
                                Name:  Lowell W. Hill
                                Title: Managing Director

                                Address: 333 South Grand Avenue, 28th Floor
                                         ---------------------------------------
                                         Los Angeles, CA 90071
                                         ---------------------------------------<PAGE>

                                                                     EXHIBIT 4.3

                                WARRANT AGREEMENT

         This WARRANT AGREEMENT, dated as of January 2, 2002 (this "AGREEMENT"),
is made and entered into by and between Alderwoods Group, Inc., a Delaware
corporation (the "COMPANY"), and Wells Fargo Bank Minnesota, National
Association, a national banking association (the "WARRANT AGENT").

                                    RECITALS

         A. A plan of reorganization of the Company, its parent corporation and
certain of their debtor subsidiaries (the "PLAN") proposed by the Company was
confirmed by the United States Bankruptcy Court for the District of Delaware on
December 5, 2001.

         B. The Plan provides for the execution and delivery of this Agreement
by the Company.

         C. The Company desires to issue the Warrants (as defined below) on the
terms and subject to the conditions herein set forth.

         NOW, THEREFORE, in consideration of the mutual covenants herein set
forth, the parties hereto hereby agree as follows:

         1.  ISSUANCE OF WARRANTS; FORM OF WARRANTS.

         1.1 ISSUANCE OF WARRANTS. On the terms and subject to the conditions
set forth in the Plan, (a) the Company will issue and deliver to (i) holders of
Allowed Claims in Class 8, (ii) holders of Allowed Claims in Divisions A, B, F,
G and H of Class 11, and (iii) if Class 19 accepts the Plan, Loewen Group
Capital, L.P. ("LGCLP"), the holder of Allowed Claims in Class 9 (as such terms
are defined in the Plan), an aggregate of up to 2,992,000 (subject to increase
as a result of the application of the rounding provisions set forth in Section
VI.H.3.a of the Plan) warrants (the "WARRANTS"), each Warrant initially
representing the right to purchase one share of Common Stock (as defined below),
and (b) immediately after the issuance of Warrants, if any, to LGCLP as
contemplated by clause (a), the Company and the Warrant Agent will effect the
transfer and delivery of such Warrants from LGCLP to the holders of Allowed
Interests and Claims in Class 19 (as such terms are defined in the Plan). The
purchase price per Warrant Share (as defined below) payable upon the exercise of
a Warrant (the "WARRANT PRICE") will initially be $25.76. The shares of Common
Stock purchasable upon exercise of the Warrants are hereinafter referred to as
the "WARRANT SHARES." The Warrant Price and the number and kind of Warrant
Shares purchasable upon exercise of the Warrants are subject to adjustment
pursuant to the provisions of SECTION 4.

         1.2 FORM OF WARRANTS. Each Warrant, including without limitation any
Warrants that may be issued upon partial exercise, replacement or transfer of
Warrants, will be evidenced by, and subject to the terms of, a Warrant
certificate (including the Form of Exercise Notice and

<PAGE>

Form of Assignment to be printed on the reverse thereof, a "WARRANT
CERTIFICATE") in substantially the form of EXHIBIT A, with such changes, such
marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required
to comply with any applicable law or with any rule or regulation made
pursuant thereto.

         1.3 COUNTERSIGNATURE OF WARRANTS. The Warrant Certificates will be
executed on behalf of the Company by the manual or facsimile signature of its
Chairman, Chief Executive Officer, President or any Vice President, and attested
by its Secretary or any Assistant Secretary. The Warrant Certificates will be
countersigned by the Warrant Agent manually and will not be valid for any
purpose unless so countersigned. In case any officer of the Company who has
signed any of the Warrant Certificates ceases to be such officer of the Company
before countersignature by the Warrant Agent and issuance and delivery by the
Company, such Warrant Certificates, nevertheless, may be countersigned by the
Warrant Agent, and issued and delivered by the Company with the same force and
effect as though the person who signed such Warrant Certificates had not ceased
to be such officer of the Company; and any Warrant Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Warrant Certificate, is a proper officer of the Company to sign such
Warrant Certificate, although on any other date such person was not such an
officer.

         1.4 REGISTRATION OF WARRANTS. The Warrant Agent will keep or cause to
be kept, at the principal office of the Warrant Agent designated for such
purpose, books for registration and transfer of the Warrant Certificates issued
hereunder. Such books will show the names and addresses of the respective
holders of the Warrant Certificates, the number of Warrants evidenced on its
face by each of the Warrant Certificates and the date of each of the Warrant
Certificates. The Company and the Warrant Agent will be entitled to treat the
registered holder of any Warrant Certificate (the "HOLDER") as the sole owner of
the Warrants represented by such Warrant Certificate for all purposes and will
not be bound to recognize any equitable or other claim or interest in such
Warrants on the part of any other person. Neither the Company nor the Warrant
Agent will be liable for any registration of transfer of any Warrants that are
registered or to be registered in the name of a fiduciary or the nominee of a
fiduciary.

         2. TRANSFER AND EXCHANGE OF WARRANTS.

         2.1 TRANSFER AND EXCHANGE. Any Warrant Certificate may be transferred,
split up, combined or exchanged for another Warrant Certificate or Warrant
Certificates entitling the Holder thereof to purchase a like aggregate number of
Warrant Shares as the Warrant Certificate or Warrant Certificates surrendered
then entitled such Holder (or former Holder in the case of a transfer) to
purchase. Any Holder desiring to transfer, split up, combine or exchange any
such Warrant Certificate will make such request in writing delivered to the
Warrant Agent, and will surrender the Warrant Certificate or Warrant
Certificates to be transferred, split up, combined or exchanged, with the Form
of Assignment duly executed by the Holder thereof, at the principal office of
the Warrant Agent designated for such purpose. Thereupon or as promptly as
practicable thereafter, the Company will prepare, execute and deliver to the
Warrant Agent, and the Warrant Agent will countersign and deliver, a Warrant
Certificate or Warrant Certificates, as the case may be, as so requested.
Neither the Company nor the Warrant Agent will be required to issue or deliver
any Warrant Certificates in connection with any transfer, split up, combination

                                        2
<PAGE>

or exchange of Warrants or Warrant Certificates unless and until the person or
persons requesting the issuance or delivery thereof has paid to the Warrant
Agent the amount of any tax or governmental charge that may be payable in
connection with such transfer, split up, combination or exchange or has
established to the satisfaction of the Warrant Agent that any tax or
governmental charge has been paid. Holders will not be required to pay any other
charge in connection with the transfer, split up, combination or exchange of
Warrants.

         2.2 LOST, STOLEN, AND MUTILATED WARRANT CERTIFICATES. Upon (a) receipt
by the Company and the Warrant Agent of (i) evidence satisfactory to the Company
and the Warrant Agent of the loss, theft, mutilation or destruction of a Warrant
Certificate and (ii) security or indemnity as may be required by the Company or
the Warrant Agent of all reasonable expenses incidental thereto, and (b)
surrender to the Warrant Agent and cancellation of the Warrant Certificate if
mutilated, the Company will prepare, execute and deliver a new Warrant
Certificate of like tenor to the Warrant Agent and the Warrant Agent will
countersign and deliver such new Warrant Certificate to the Holder in lieu of
the Warrant Certificate so lost, stolen, mutilated or destroyed.

         2.3 PAYMENT OF TAXES. The Company will pay all documentary or stamp
taxes, if any, attributable to the initial issuance and transfer of the Warrants
pursuant to the first sentence of SECTION 1.1 and the initial issuance of the
Warrant Shares upon the exercise of Warrants; PROVIDED, HOWEVER, that the
Company's obligations in this regard will in all events be conditioned upon the
Holder cooperating with the Company and the Warrant Agent in any reasonable
arrangement designed to minimize or eliminate any such taxes. Neither the
Company nor the Warrant Agent will be required to pay any tax or governmental
charge that may be payable in connection with any transfer, split up,
combination or exchange of Warrants or Warrant Certificates.

         2.4 CANCELLATION AND DESTRUCTION OF WARRANT CERTIFICATES. All Warrant
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange will, if surrendered to the Company, be delivered to the
Warrant Agent for cancellation or in canceled form, or, if surrendered to the
Warrant Agent, will be canceled by it, and no Warrant Certificates will be
issued in lieu thereof except as expressly permitted by this Agreement. The
Company will deliver to the Warrant Agent for cancellation and retirement, and
the Warrant Agent will so cancel and retire, any other Warrant Certificate
purchased or acquired by the Company otherwise than upon the exercise thereof.
The Warrant Agent will destroy such canceled Warrant Certificates and deliver a
certificate of destruction thereof to the Company.

         3.  EXERCISE OF WARRANTS.

         3.1 EXERCISE OF WARRANTS. (a) Warrants may be exercised by the Holder
thereof, in whole or in part, at any time and from time to time after the date
hereof and prior to 5:00 p.m., New York City time on the fifth anniversary of
the date hereof (the "EXPIRATION DATE") by delivering to the Warrant Agent, at
its principal office designated for such purpose, the following:

                                        3
<PAGE>

             (i) the Warrant Certificate or Warrant Certificates representing
         the Warrants to be exercised, with the Form of Exercise Notice duly
         executed by the Holder thereof; and

             (ii) cash, a certified or bank cashier's check payable to the order
         of the Company, or a wire transfer to an account designated by the
         Company, in each case in an amount equal to the product of (A) the
         number of Warrant Shares purchasable upon the exercise of the Warrants
         designated for exercise in the Form of Exercise Notice and (B) the
         Warrant Price.

             (a) As promptly as practicable after an exercise of Warrants in
         accordance with SECTION 3.1(a), and in any event within 10 Business
         Days (as defined below) after such exercise, the Warrant Agent will (i)
         requisition from any transfer agent for the Common Stock (or make
         available, if the Warrant Agent is the transfer agent) certificates
         representing the number of Warrant Shares to be purchased (and the
         Company hereby irrevocably authorizes and directs its transfer agent to
         comply with all such requests), (ii) after receipt of such
         certificates, cause the same to be delivered to or upon the order of
         the Holder exercising such Warrants, registered in such name or names
         as may be designated by such Holder, (iii) when appropriate,
         requisition from the Company the amount of cash to be paid in lieu of
         the issuance of fractional Warrant Shares in accordance with the
         provisions of SECTION 5, and (iv) when appropriate, after receipt,
         deliver such cash to or upon the order of the Holder exercising such
         Warrants.

             (b) If the number of Warrants represented by a Warrant Certificate
         are not exercised in full, the Company will prepare, execute and
         deliver to the Warrant Agent a new Warrant Certificate evidencing
         Warrants equivalent to such Warrants remaining unexercised and the
         Warrant Agent will countersign and deliver such new Warrant Certificate
         to or upon the order of the Holder exercising such Warrants, registered
         in such name or names as may be designated by such Holder.

             (c) The Company will take all such action as may be necessary to
         ensure that all Warrant Shares delivered upon exercise of Warrants, at
         the time of delivery of the certificates for such Warrant Shares, will
         (subject to payment of the Warrant Price) be duly and validly
         authorized and issued, fully paid and nonassessable and, if shares of
         Common Stock are then listed on any national securities exchange (as
         defined in the Securities Exchange Act of 1934, as amended) or
         qualified for quotation on The Nasdaq Stock Market, Inc., will be duly
         listed or qualified for quotation thereon, as the case may be.

             (d) In the event that the Company is obligated to pay cash in lieu
         of fractional Warrant Shares pursuant to SECTION 5 in connection with
         any exercise of Warrants, it will make all arrangements necessary so
         that such cash is available for distribution by the Warrant Agent, if
         and when appropriate.

             (e) The Company will pay all expenses, taxes and other charges
         payable in connection with the preparation, issuance and delivery of
         certificates representing Warrant Shares or Warrant Certificates
         representing unexercised Warrants in connection

                                        4
<PAGE>

         with any exercise of Warrants in accordance with SECTION 3.1(a), except
         that, if any such certificates representing Warrant Shares or any such
         Warrant Certificates are to be registered in a name or names other than
         that of the Holder at the time of any such exercise of Warrants, funds
         sufficient to pay all transfer or similar taxes payable as a result of
         such transfer shall be paid by the Holder at the time of such exercise
         or promptly upon receipt of a written request of the Company for
         payment thereof. In connection with any exercise of Warrants in
         accordance with SECTION 3.1(a), the Warrants will be deemed to have
         been exercised, any certificate representing Warrant Shares or any
         Warrant Certificate issued on account thereof will be deemed to have
         been issued, and the person in whose name any such certificate or
         Warrant Certificate is issued will be deemed for all purposes to have
         become a holder of record of the Warrant Shares or Warrants, as the
         case may be, represented thereby as of the date of such exercise.

         3.2 CERTAIN DEFINITIONS. For purposes of this Agreement, (a) the term
"BUSINESS DAY" means any day other than a Saturday, Sunday or a day on which
banking institutions in the state of New York are authorized or obligated by law
or executive order to close and (b) the term "TRADING DAY" means any day on
which shares of Common Stock are traded on the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
or, if shares of Common Stock are not so listed or admitted to trading, in the
over-the-counter market.

         4. ADJUSTMENTS OF WARRANT PRICE AND WARRANT SHARES. The Warrant Price
and the number and kind of Warrant Shares purchasable upon exercise of the
Warrants will be subject to adjustment from time to time upon the occurrence of
certain events as provided in this SECTION 4.

         4.1 MECHANICAL ADJUSTMENTS. The Warrant Price and the number and kind
of Warrant Shares purchasable upon exercise of a Warrant will be subject to
adjustment as follows:

             (a) Subject to SECTION 4.1(f), if the Company (i) pays a dividend
         or otherwise distributes to holders of its Common Stock, as such,
         shares of its capital stock (whether Common Stock or capital stock of
         any other class), (ii) subdivides its outstanding shares of Common
         Stock into a greater number of shares of Common Stock, (iii) combines
         its outstanding shares of Common Stock into a smaller number of shares
         of Common Stock, or (iv) issues any shares of its capital stock in a
         reclassification of its outstanding shares of Common Stock (including
         any such reclassification in connection with a consolidation, merger or
         other business combination transaction in which the Company is the
         continuing or surviving corporation), then the number and kind of
         Warrant Shares purchasable upon exercise of each Warrant immediately
         prior thereto will be adjusted so that the Holder of each Warrant will
         be entitled to receive (A) in the case of a dividend or distribution,
         the sum of (1) the number of Warrant Shares that, if such Warrant had
         been exercised immediately prior to such adjustment, such Holder would
         have received upon such exercise and (2) the number and kind of
         additional shares of capital stock that such Holder would have been
         entitled to receive as a result of such dividend or distribution by
         virtue of its ownership of such Warrant Shares, (B) in the case of a
         subdivision or combination, the number of Warrant Shares that, if such
         Warrant had been exercised immediately prior to such adjustment, such
         Holder would have received upon such exercise, adjusted to give effect
         to such subdivision or combination as if such Warrant

                                        5
<PAGE>

         Shares had been subject thereto, or (C) in the case of an issuance in a
         reclassification, the sum of (1) the number of Warrant Shares that, if
         such Warrant had been exercised immediately prior to such adjustment,
         such Holder would have received upon such exercise and retained after
         giving effect to such reclassification as if such Warrants Shares had
         been subject thereto and (2) the number and kind of additional shares
         of capital stock that such Holder would have been entitled to receive
         as a result of such reclassification as if such Warrant Shares had been
         subject thereto. An adjustment made pursuant to this paragraph (a), in
         the case of a dividend or distribution, will be made whenever such
         dividend or distribution is made and, at such time, will become
         effective retroactive to the time that is immediately after the record
         date for the determination of stockholders entitled to receive such
         dividend or distribution and, in the case of a subdivision, combination
         or reclassification, will make each become effective immediately after
         the effective date of such subdivision, combination or
         reclassification.

             (b) Subject to SECTION 4.1(f), if the Company distributes to
         holders of its Common Stock, as such, (i) evidences of indebtedness or
         assets (excluding regular cash dividends or cash distributions payable
         out of surplus or net profits legally available therefor or those
         distributions described in SECTION 4(a)) of the Company or any
         corporation or other legal entity a majority of the voting equity
         securities or equity interests of which are owned, directly or
         indirectly, by the Company (a "SUBSIDIARY"), (ii) shares of capital
         stock of any Subsidiary, (iii) securities convertible into or
         exchangeable for capital stock of the Company (including Common Stock
         or capital stock of any other class) or any Subsidiary, or (iv) any
         rights, options or warrants to purchase any of the foregoing (excluding
         those described in SECTION 4.1(c)), then the number of Warrant Shares
         thereafter purchasable upon exercise of each Warrant will be adjusted
         to the number that results from multiplying the number of Warrant
         Shares purchasable upon the exercise of each Warrant immediately prior
         to such adjustment by a fraction (not to be less than one), the
         numerator of which will be the Current Market Price (as defined below)
         per share of Common Stock on the record date for such distribution, and
         the denominator of which will be such Current Market Price per share of
         Common Stock less the fair value (as determined in good faith by the
         Board of Directors of the Company, whose determination will be
         conclusive if based on the financial advice of a nationally recognized
         investment banking firm) of the portion of the evidences of
         indebtedness, assets, securities or rights, options or warrants so
         distributed on account of one share of Common Stock. Such adjustment
         will be made whenever any such distribution is made and, at such time,
         will become effective retroactive to the time that is immediately after
         the record date for the determination of stockholders entitled to
         receive such distribution. Except as provided in SECTION 4.1(i), no
         further adjustments of the number of Warrant Shares will be made upon
         the actual conversion or exchange of such convertible or exchangeable
         securities or upon the actual exercise of such rights, options or
         warrants. If the fair value (as so determined) of the portion of the
         evidences of indebtedness, assets, securities or rights, options or
         warrants so distributed on account of one share of Common Stock is
         equal to or greater than the Current Market Price per share of Common
         Stock on the record date for such distribution, in lieu of the
         foregoing adjustment, then provision will be made so that the Holder of
         each Warrant will be entitled to receive the sum of (A) the number of
         Warrant Shares that, if such Warrant had been exercised immediately
         prior to such record date, such Holder would have received

                                        6
<PAGE>

         upon exercise and (B) such evidences of indebtedness, assets,
         securities or rights, options or warrants that such Holder would have
         been entitled to receive as a result of such distribution by virtue of
         its ownership of such Warrant Shares.

             (c) Subject to SECTION 4.1(f), if the Company issues rights,
         options or warrants to holders of the outstanding shares of Common
         Stock, as such, entitling the holders of such rights, options or
         warrants to subscribe for or purchase shares of Common Stock at a price
         per share that is lower on the record date mentioned below than the
         Current Market Price per share of Common Stock on such record date,
         then the number of Warrant Shares thereafter purchasable upon the
         exercise of each Warrant will be adjusted to the number that results
         from multiplying the number of Warrant Shares purchasable upon exercise
         of each Warrant immediately prior to such adjustment by a fraction (not
         to be less than one), the numerator of which will be the number of
         shares of Common Stock outstanding on such record date plus the number
         of additional shares of Common Stock offered by such rights, options or
         warrants for subscription or purchase and the denominator of which will
         be the number of shares of Common Stock outstanding on such record date
         plus the number of shares of Common Stock which the aggregate
         subscription or purchase price of the total number of shares of Common
         Stock so offered would purchase at the Current Market Price per share
         of Common Stock on such record date. Such adjustment will be made
         whenever such rights, options or warrants are issued and, at such time,
         will become effective retroactive to the time that is immediately after
         the record date for the determination of stockholders entitled to
         receive such rights, options or warrants. In case such subscription or
         purchase price may be paid in a consideration part or all of which is
         in a form other than cash, the fair value of such consideration will be
         as determined by the Board of Directors of the Company, whose
         determination will be conclusive if based on the financial advice of a
         nationally recognized investment banking firm. Except as provided in
         SECTION 4.1(i), no further adjustments of the number of Warrant Shares
         will be made upon the actual issue of shares of Common Stock upon
         exercise of such rights, options or warrants.

             (d) Subject to SECTION 4.1(f), if the Company issues shares of
         Common Stock, securities convertible into or exchangeable for shares of
         Common Stock or rights, options or warrants entitling the holders of
         such rights, options or warrants to subscribe for or purchase shares of
         Common Stock (excluding shares of Common Stock, convertible or
         exchangeable securities or rights, options or warrants issued in any of
         the transactions described in paragraph (a), (b) or (c) of this SECTION
         4.1) for a purchase price per share of such Common Stock, for a
         conversion or exchange price per share of Common Stock initially
         deliverable upon conversion or exchange of such securities, or for a
         subscription or purchase price per share of Common Stock initially
         deliverable upon exercise of such rights, options or warrants, that is
         less than the Current Market Price per share of Common Stock on the
         date the purchase, conversion, exchange or subscription price of such
         additional shares of Common Stock are first fixed, then the number of
         Warrant Shares thereafter purchasable upon the exercise of each Warrant
         will be adjusted to the number that results from multiplying the number
         of Warrant Shares purchasable upon exercise of each Warrant immediately
         prior to such adjustment by a fraction (not to be less than one), the
         numerator of which will be the number of shares of Common Stock
         outstanding on such date plus the number of additional shares of Common
         Stock so

                                        7
<PAGE>

         issued or issuable upon such conversion, exchange or exercise, and the
         denominator of which will be the number of shares of Common Stock
         outstanding on such date plus the number of shares of Common Stock
         which the aggregate purchase, conversion, exchange or subscription
         price received or receivable by the Company for such additional shares
         of Common Stock would purchase at the Current Market Price per share of
         Common Stock on such date. Such adjustment will be made and become
         effective immediately after such shares of Common Stock or convertible
         or exchangeable securities are issued. In case such purchase,
         conversion, exchange or subscription price may be paid in a
         consideration part or all of which is in a form other than cash, the
         fair value of such consideration will be as determined by the Board of
         Directors of the Company, whose determination will be conclusive if
         based on the financial advice of a nationally recognized investment
         banking firm. Except as provided in SECTION 4.1(i), no further
         adjustment will be made upon the actual issue of shares of Common Stock
         upon conversion or exchange of such securities convertible into or
         exchangeable for shares of Common Stock or upon exercise of rights,
         options or warrants entitling the holders of such rights, options or
         warrants to subscribe for or purchase shares of Common Stock.

             (e) For purposes of this Agreement, the "CURRENT MARKET PRICE" per
         share of Common Stock on any date will be the average of the daily
         closing prices for 20 consecutive Trading Days commencing 30 Trading
         Days before the date of such computation; PROVIDED, HOWEVER, that in
         the event that the Current Market Price per share of Common Stock is
         determined during a period following the announcement of (i) a dividend
         or distribution on Common Stock payable in shares of Common Stock or
         securities convertible into or exchangeable for shares of Common Stock
         or (ii) any subdivision, combination or reclassification of shares of
         Common Stock, and prior to the expiration of 30 Trading Days after the
         ex-dividend date of such dividend or distribution, or the effective
         date for such subdivision, combination or reclassification, then, and
         in each such case, the Current Market Price per share will be
         appropriately adjusted to take into account ex-dividend trading or to
         reflect the Current Market Price per share per Common Stock equivalent.
         The closing price for each day (the "CLOSING PRICE") will be the last
         sale price, regular way, or, in case no such sale takes place on such
         day, the average of the closing bid and asked prices, regular way, in
         either case as reported in the principal consolidated transaction
         reporting system with respect to securities listed on the principal
         national securities exchange on which shares of Common Stock are listed
         or admitted to trading or, if shares of Common Stock are not listed or
         admitted to trading on any national securities exchange, the last
         quoted price or, if not so quoted, the average of the high bid and low
         asked prices in the over-the-counter market, as reported by The Nasdaq
         Stock Market, Inc. or such other system then in use, or, if on any such
         date shares of Common Stock are not quoted by any such organization,
         the average of the closing bid and asked prices as furnished by a
         professional market maker making a market in shares of Common Stock
         selected by the Board of Directors of the Company. If the Common Stocks
         are not publicly held or not so listed or traded, or are not the
         subject of available bid and asked quotes, "Current Market Price" per
         share will mean the fair value per share as determined in good faith by
         the Board of Directors of the Company.

             (f) No adjustment in the number of Warrant Shares purchasable upon
         the exercise of a Warrant will be required unless such adjustment would
         require an increase

                                        8
<PAGE>

         or decrease in the number of Warrant Shares purchasable upon the
         hypothetical exercise of a Warrant of at least 1%; PROVIDED, HOWEVER,
         that any adjustments which by reason of this paragraph (f) are not
         required to be made currently will be carried forward and made at the
         time and together with the next subsequent adjustment which, together
         with any adjustments so carried forward, would require an increase or
         decrease in the number of Warrant Shares purchasable upon the
         hypothetical exercise of a Warrant of 1% or more. All calculations with
         respect to the number of Warrant Shares will be made to the nearest
         one-thousandth of a share and all calculations with respect to the
         Warrant Price will be to the nearest whole cent. No adjustment in the
         number of Warrant Shares purchasable upon the exercise of a Warrant
         will be made under clause (i) of paragraph (a) of this SECTION 4.1 or
         paragraph (b), (c) or (d) of this SECTION 4.1 if the Company issues or
         distributes to each Holder the shares, rights, options, warrants,
         convertible or exchangeable securities, evidences of indebtedness,
         assets or other securities referred to in the applicable paragraph that
         such Holder would have been entitled to receive had the Warrants been
         exercised prior to the happening of such event or the record date with
         respect thereto (PROVIDED that, in any case in which such Holder would
         have been so entitled to receive a fractional interest in any such
         securities or assets, the Company may distribute to such Holder in lieu
         of such fractional interest cash in an amount equal to the fair value
         of such fractional interest as determined in good faith by the Board of
         Directors of the Company). No adjustment in the number of Warrant
         Shares purchasable upon the exercise of a Warrant will be made on
         account of: (1) any issuance of shares of Common Stock, or of options,
         rights or warrants to purchase, or securities convertible into or
         exchangeable for, shares of Common Stock, pursuant to the Plan, (2) any
         issuance of shares of Common Stock upon the exercise of options, rights
         or warrants or upon the conversion or exchange of convertible or
         exchangeable securities, in either case issued pursuant to the Plan or
         outstanding as of the date hereof, (3) any issuance of shares of Common
         Stock, or of options, rights or warrants, or of other securities,
         pursuant to a share purchase rights plan or any similar plan adopted by
         the Board of Directors of the Company, (4) any issuance of shares of
         Common Stock, or of options, rights or warrants to purchase, or
         securities convertible into or exchangeable for, shares of Common
         Stock, in accordance with any plan for the benefit of the employees or
         Directors of the Company existing as of the date hereof or contemplated
         by the Plan or any other plan adopted by the Directors of the Company
         for the benefit of the employees or Directors of the Company or any of
         its Subsidiaries, (5) any issuance of shares of Common Stock in
         connection with a Company-sponsored plan for reinvestment of dividends
         or interest, (6) any issuance of shares of Common Stock, securities
         convertible into or exchangeable for shares of Common Stock or rights,
         options or warrants entitling the holders of such rights, options or
         warrants to subscribe for or purchase shares of Common Stock pursuant
         to an underwritten public offering, in the case of an issuance of
         shares of Common Stock, for a price per share of Common Stock or, in
         the case of an issuance of convertible or exchangeable securities or
         rights, warrants or options involving a conversion or exchange price
         per share of Common Stock initially deliverable upon conversion or
         exchange of such convertible or exchangeable securities or a
         subscription or purchase price per share of Common Stock initially
         deliverable upon exercise of such rights, options or warrants, as
         applicable, that is equal to or greater than 95% of the Closing Price
         per share of Common Stock on the date the offering, conversion,
         exchange subscription or purchase

                                        9
<PAGE>

         price of such additional shares of Common Stock is first fixed, or (7)
         any issuance of shares of Common Stock or other securities to the
         owners of any entity that is acquired by the Company in an arm's-length
         transaction approved by the Board of Directors of the Company. No
         adjustment in the number of Warrant Shares will be made for a change in
         the par value of the shares of Common Stock.

             (g) Whenever the number of Warrant Shares purchasable upon the
         exercise of each Warrant is adjusted as herein provided, the Warrant
         Price will be adjusted by multiplying the Warrant Price in effect
         immediately prior to such adjustment by a fraction, the numerator of
         which will be the number of Warrant Shares purchasable upon the
         exercise of each Warrant immediately prior to such adjustment, and the
         denominator of which will be the number of Warrant Shares so
         purchasable immediately thereafter.

             (h) For the purpose of this Agreement, the term "COMMON STOCK"
         means (i) the class of shares designated as the Common Stock of the
         Company as of the date of this Agreement, (ii) all shares of any class
         or classes (however designated) of the Company, now or hereafter
         authorized, the holders of which have the right, without limitation as
         to amount, either to all or to a part of the balance of current
         dividends and liquidating dividends after the payment of dividends and
         distributions on any shares entitled to preference, and the holders of
         which are ordinarily entitled to vote generally in the election of
         directors of the Company, or (iii) any other class of shares resulting
         from successive changes or reclassifications of such shares consisting
         solely of changes in par value, or from par value to no par value, or
         from no par value to par value. In the event that at any time, as a
         result of an adjustment made pursuant to SECTION 4.1(a), the Warrants
         become exercisable to purchase Warrant Shares other than shares of
         Common Stock, thereafter the number of such other shares so purchasable
         upon exercise of each Warrant and the Warrant Price payable in respect
         of such other shares upon the exercise of each Warrant will be subject
         to adjustment from time to time in a manner and on terms as nearly
         equivalent as practicable to the provisions with respect to the Warrant
         Shares and the Warrant Price contained in this SECTION 4.1.

             (i) Upon the expiration of any rights, options, warrants or
         conversion or exchange privileges, if any thereof have not been
         exercised, the Warrant Price and the number of Warrant Shares
         purchasable upon the exercise of each Warrant will, upon such
         expiration, be readjusted and will thereafter be such as it would have
         been had it been originally adjusted (or had the original adjustment
         not been required, as the case may be) as if (i) the only shares of
         Common Stock so issued were the shares of Common Stock, if any,
         actually issued or sold upon the exercise of such rights, options,
         warrants or conversion or exchange privileges and (ii) such shares of
         Common Stock, if any, were issued or sold for the consideration
         actually received by the Company upon such exercise, conversion or
         exchange plus the aggregate consideration, if any, actually received by
         the Company for the issuance, sale or grant of all such rights,
         options, warrants or conversion or exchange privileges whether or not
         exercised; PROVIDED, HOWEVER, that no such readjustment will have the
         effect of increasing the Warrant Price or decreasing the number of
         Warrant Shares purchasable upon the exercise of each Warrant by an
         amount in excess of the amount of the adjustment initially made in
         respect of the

                                       10
<PAGE>

         issuance, sale, or grant of such rights, options, warrants or
         conversion or exchange privileges.

         4.2 VOLUNTARY ADJUSTMENT. The Company may at its option, at any time
prior to the Expiration Date, reduce the then-current Warrant Price to any
amount deemed appropriate by the Board of Directors.

         4.3 NOTICE OF ADJUSTMENT. Whenever the Warrant Price or the number or
kind of Warrant Shares purchasable upon exercise of the Warrants is adjusted
pursuant to any of the provisions of this Agreement, the Company will promptly
give notice to the Warrant Agent and the Holders of such adjustment or
adjustments, together with a certificate of a firm of independent public
accountants selected by the Company (who may be the regular accountants employed
by the Company) setting forth the adjustments in the Warrant Price and the
number or kind of Warrant Shares purchasable upon exercise of each Warrant, and
also setting forth a brief statement of the facts requiring such adjustments and
the computations upon which such adjustments are based. Such certificate will be
conclusive evidence of the correctness of such adjustments.

         4.4 NO ADJUSTMENT FOR DIVIDENDS. Except as provided in SECTION 4.1, no
adjustment or payment in respect of any dividends will be made at any time.

         4.5 PRESERVATION OF PURCHASE RIGHTS UPON MERGER, CONSOLIDATION, ETC. In
case of any consolidation of the Company with or merger of the Company into
another corporation or in case of any sale, transfer or lease to another
corporation of all or substantially all the property of the Company, the Company
or such successor or purchasing corporation, as the case may be, will execute an
agreement providing that each Holder will have the right thereafter, upon
payment of an amount equal to the amount payable upon the exercise of a Warrant
immediately prior thereto, to purchase upon exercise of each Warrant the kind
and amount of securities or property that it would have owned or have been
entitled to receive after giving effect to such consolidation, merger, sale,
transfer or lease on account of the Warrant Shares that would have been
purchasable upon the exercise of such Warrant had such Warrant been exercised
immediately prior thereto (PROVIDED that, to the extent that such Holder would
have been so entitled to receive cash on account of such Warrant Shares, such
Holder may elect in connection with the exercise of a Warrant in accordance with
SECTION 3.1 to reduce the amount of cash that it would be entitled to receive
upon such exercise in exchange for a corresponding reduction in the amount
payable upon such exercise); PROVIDED, HOWEVER, that no adjustment in respect of
dividends, interest or other income on or from such shares or other securities
or property will be made during the term of a Warrant or upon the exercise of a
Warrant. Such agreement will provide for adjustments that will be as nearly
equivalent as may be practicable to the adjustments provided for in this SECTION
4. The provisions of this SECTION 4.5 will similarly apply to successive
consolidations, mergers, sales, transfers or leases.

         4.6 WARRANT CERTIFICATES. Whether or not any adjustments in the Warrant
Price or the number or kind of Warrant Shares purchasable upon the exercise of
the Warrants has been made, Warrant Certificates theretofore or thereafter
issued may continue to express the same Warrant Price and number and kind of
Warrant Shares as are stated in the Warrant Certificate initially issued.

                                       11
<PAGE>

         5. FRACTIONAL INTERESTS. Neither the Company nor the Warrant Agent will
be required to issue fractional Warrant Shares or fractional interests in any
other securities on the exercise of the Warrants. If any fraction of a Warrant
Share or other security would, except for the provisions of this SECTION 5, be
issuable upon the exercise of the Warrants, the Company will pay an amount in
cash (a) in lieu of a fractional Warrant Share, equal to the Current Market
Price for one share of Common Stock on the Trading Day immediately preceding the
date on which the Warrants are presented for exercise, multiplied by such
fraction of a Warrant Share, or (b) in lieu of a fractional interest in any
other security, equal to the fair value of such fractional interest, determined
in a manner as similar as possible, taking into account the difference in the
fractional interest being valued, to the calculation described in clause (a) of
this SECTION 5.

         6. WARRANT AGENT MATTERS.

         6.1 APPOINTMENT OF WARRANT AGENT. The Company hereby appoints the
Warrant Agent to act as agent for the Company and the Holders in accordance with
the terms and conditions hereof, and the Warrant Agent hereby accepts such
appointment.

         6.2 CONCERNING THE WARRANT AGENT. (a) The Company will pay to the
Warrant Agent reasonable compensation for all services rendered by it hereunder
and, from time to time, on demand of the Warrant Agent, its reasonable expenses
and counsel fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company will indemnify the Warrant Agent for, and hold it
harmless against, any loss, liability, suit, action, proceeding or expense,
incurred without negligence, bad faith or willful misconduct on the part of the
Warrant Agent, for anything done or omitted by the Warrant Agent in connection
with the acceptance and administration of this Agreement, including the costs
and expenses of defending against any claim of liability arising therefrom,
directly or indirectly.

         (b) The Warrant Agent will be protected and will incur no liability for
or in respect of any action taken, suffered or omitted by it in connection with
its administration of this Agreement in reliance upon any Warrant Certificate or
certificate evidencing Common Stock or other securities of the Company,
instrument of assignment or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement, other paper or
document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged by the proper person or persons.

         6.3 MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT. Any
corporation into which the Warrant Agent or any successor Warrant Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Warrant Agent or any successor Warrant
Agent is a party, or any corporation succeeding to the corporate trust business
of the Warrant Agent or any successor Warrant Agent, will be the successor to
the Warrant Agent under this Agreement without the execution or filing of any
paper or any further act on the part of any of the parties hereto, PROVIDED that
such corporation would be eligible for appointment as a successor Warrant Agent
under the provisions of SECTION 6.5.

                                       12
<PAGE>

         6.4 DUTIES OF WARRANT AGENT. The Warrant Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the Holders, by their acceptance of
Warrant Certificates, will be bound:

             (a) The Warrant Agent may consult with legal counsel (who may be
         legal counsel for the Company), and the opinion of such counsel will be
         full and complete authorization and protection to the Warrant Agent as
         to any action taken or omitted by it in good faith and in accordance
         with such opinion.

             (b) Whenever in the performance of its duties under this Agreement
         the Warrant Agent deems it necessary or desirable that any fact or
         matter be proved or established by the Company prior to taking or
         suffering any action hereunder, such fact or matter (unless other
         evidence in respect thereof be herein specifically prescribed) may be
         deemed to be conclusively proved and established by a certificate
         signed by any one of the Chairman of the Board, the Chief Executive
         Officer, the President or any Vice President of the Company and
         delivered to the Warrant Agent; and such certificate will be full
         authorization to the Warrant Agent for any action taken or suffered in
         good faith by it under the provisions of this Agreement in reliance
         upon such certificate.

             (c) The Warrant Agent will be liable hereunder only for its own
         gross negligence, bad faith or willful misconduct.

             (d) The Warrant Agent will not be liable for or by reason of any of
         the statements of fact or recitals contained in this Agreement or in
         the Warrant Certificates or be required to verify the same, but all
         such statements and recitals are and will be deemed to have been made
         by the Company only.

             (e) The Warrant Agent will not be under any responsibility in
         respect of the validity of this Agreement or the execution and delivery
         hereof (except the due execution and delivery hereof by the Warrant
         Agent) or in respect of the validity or execution of any Warrant
         Certificate (except the due countersignature thereof by the Warrant
         Agent); nor will it be responsible for any breach by the Company of any
         covenant or condition contained in this Agreement or in any Warrant
         Certificate; nor will it be responsible for any adjustment required
         under the provisions of SECTION 4 hereof or responsible for the manner,
         method or amount of any such adjustment or the ascertaining
         of the existence of facts that would require any such adjustment
         (except with respect to the exercise of Warrants evidenced by Warrant
         Certificates after actual notice of any such adjustment); nor will it
         by any act hereunder be deemed to make any representation or warranty
         as to the authorization or reservation of any shares of stock or other
         securities to be issued pursuant to this Agreement or any Warrant
         Certificate or as to whether any shares of stock or other securities
         will, when issued, be validly authorized and issued, fully paid and
         nonassessable.

             (f) The Company will perform, execute, acknowledge and deliver or
         cause to be performed, executed, acknowledged and delivered all such
         further and other acts, instruments and assurances as may reasonably be
         required by the Warrant Agent for the carrying out or performing by the
         Warrant Agent of the provisions of this Agreement.

                                       13
<PAGE>

             (g) The Warrant Agent is hereby authorized and directed to accept
         instructions with respect to the performance of its duties hereunder
         from any one of the Chairman of the Board, the Chief Executive Officer,
         the President or any Vice President of the Company, and to apply to
         such officers for advice or instructions in connection with its duties,
         and it will not be liable for any action taken or suffered to be taken
         by it in good faith in accordance with instructions of any such
         officer.

             (h) The Warrant Agent and any stockholder, director, officer or
         employee of the Warrant Agent may buy, sell or deal in any of the
         Warrants or other securities of the Company or become pecuniarily
         interested in any transaction in which the Company may be interested,
         or contract with or lend money to the Company or otherwise act as fully
         and freely as though it were not Warrant Agent under this Agreement.
         Nothing herein will preclude the Warrant Agent from acting in any other
         capacity for the Company or for any other legal entity.

             (i) The Warrant Agent may execute and exercise any of the rights or
         powers hereby vested in it or perform any duty hereunder either itself
         or by or through its attorneys or agents, and the Warrant Agent will
         not be answerable or accountable for any act, default, neglect or
         misconduct of any such attorneys or agents or for any loss to the
         Company resulting from any such act, default, neglect or misconduct,
         PROVIDED reasonable care was exercised in the selection and continued
         employment thereof. The Warrant Agent will not be under any duty or
         responsibility to insure compliance with any applicable federal or
         state securities laws in connection with the issuance, transfer or
         exchange of Warrant Certificates.

         6.5 CHANGE OF WARRANT AGENT. The Warrant Agent or any successor Warrant
Agent may resign and be discharged from its duties under this Agreement upon 30
calendar days' notice in writing mailed to the Company and to each transfer
agent of the Common Stock by registered or certified mail, and to the Holders by
first-class mail. The Company may remove the Warrant Agent or any successor
Warrant Agent upon 30 calendar days' notice in writing, mailed to the Warrant
Agent or successor Warrant Agent, as the case may be, and to each transfer agent
of the Common Stock by registered or certified mail, and to the Holders by
first-class mail. If the Warrant Agent resigns or is removed or otherwise
becomes incapable of acting, the Company will appoint a successor to the Warrant
Agent. If the Company fails to make such appointment within a period of 30
calendar days after giving notice of such removal or after it has been notified
in writing of such resignation or incapacity by the resigning or incapacitated
Warrant Agent or by any Holder (who will, with such notice, submit his Warrant
Certificate for inspection by the Company), then any Holder may apply to any
court of competent jurisdiction for the appointment of a successor Warrant
Agent. Any successor Warrant Agent, whether appointed by the Company or by such
a court, will be a corporation organized and doing business under the laws of
the United States or of the State of New York (or of any other state of the
United States so long as such corporation is authorized to do business as a
banking institution in the State of New York), in good standing, having a
principal office in the State of New York, which is authorized under such laws
to exercise corporate trust powers and is subject to supervision or examination
by federal or state authority and which has at the time of its appointment as
Warrant Agent a combined capital and surplus of at least $50 million. After
appointment, the successor Warrant Agent will be vested with the same powers,
rights, duties

                                       14
<PAGE>

and responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the predecessor Warrant Agent will deliver and transfer
to the successor Warrant Agent any property at the time held by it hereunder,
and execute and deliver any further assurance, conveyance, act or deed necessary
for the purpose. Not later than the effective date of any such appointment, the
Company will file notice thereof in writing with the predecessor Warrant Agent
and each transfer agent of the Common Stock, and mail by first class mail a
notice thereof to each Holder. Failure to give any notice provided for in this
SECTION 6.5, however, or any defect therein, will not affect the legality or
validity of the resignation or removal of the Warrant Agent or the appointment
of the successor Warrant Agent, as the case may be. Notwithstanding anything to
the contrary contained herein, no resignation or removal of the Warrant Agent or
any successor Warrant Agent will become effective prior to the effectiveness of
the appointment of a successor Warrant Agent therefor.

         7. RIGHTS AND NOTICES.

         7.1 NO RIGHTS AS A STOCKHOLDER; NOTICES TO HOLDERS. Nothing contained
in this Agreement or in the Warrant Certificate will be construed as conferring
upon the Holders or their transferees the right to vote, or to receive
dividends, or to consent or to 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;
PROVIDED, HOWEVER, that if, at any time prior to the Expiration Date and prior
to the exercise of all of the Warrants, any of the following events occur:

             (a) The Company declares any dividend payable in any securities
         upon its shares of Common Stock or makes any distribution (other than a
         regular cash dividend or cash distributions payable out of surplus or
         net profits legally available therefor) to the holders of its shares of
         Common Stock;

             (b) The Company offers to the holders of its Common Stock any
         shares of capital stock of the Company or any Subsidiary or securities
         convertible into or exchangeable for shares of capital stock of the
         Company or any Subsidiary or any option, right or warrant to subscribe
         for or purchase any thereof;

             (c) The Company distributes to the holders of its Common Stock
         evidences of indebtedness or assets (including any cash dividend which
         would result in an adjustment under SECTION 4.1) of the Company or any
         Subsidiary;

             (d) Any reclassification of the Common Stock, any consolidation of
         the Company with or merger of the Company into another corporation, any
         sale, transfer or lease to another corporation of all or substantially
         all the property of the Company, or any proposal of the Company to
         effect any of the foregoing transactions that has been publicly
         announced by the Company; or

             (e) Any proposal by the Company to effect a dissolution,
         liquidation or winding up of the Company that has been publicly
         announced by the Company;

then in any one or more of such events the Company will give notice of such
event to the Holders, as provided in SECTION 11 hereof, such giving of notice to
be completed at least ten

                                       15
<PAGE>

calendar days prior to the date fixed as a record date or the date of closing
the transfer books for the determination of the stockholders entitled to such
dividend, distribution or subscription rights, or for the determination of
stockholders entitled to vote on such proposed reclassification, consolidation,
merger, sale, transfer or lease, dissolution, liquidation or winding up;
PROVIDED, HOWEVER, that no such notice will be required in respect of any of the
matters referred to in the penultimate sentence of SECTION 4.1(f). Such notice
will specify such record date or the date of closing the transfer books, as the
case may be, for such event. Failure to mail or receive such notice or any
defect therein or in the mailing thereof will not affect the validity of any
action taken in connection with such event.

         7.2 AGREEMENTS RESPECTING WARRANTS. The Company will not enter into any
agreement or instrument which would preclude the exercise of the Warrants as
herein provided.

         8. AGREEMENT OF WARRANT HOLDERS. Every Holder by accepting a Warrant
Certificate consents and agrees with the Company and the Warrant Agent and with
every other Holder that:

             (a) The Warrant Certificates are transferable only in accordance
         with the terms of this Agreement and only on the registry books of the
         Warrant Agent if surrendered at the principal office of the Warrant
         Agent designated for such purpose, duly endorsed or accompanied by a
         proper instrument of transfer, and otherwise in compliance with SECTION
         2;

             (b) The Company and the Warrant Agent may deem and treat the person
         in whose name the Warrant Certificate is registered as the absolute
         owner thereof and of the Warrants evidenced thereby (notwithstanding
         any notations of ownership or writing on the Warrant Certificate made
         by anyone other than the Company or the Warrant Agent) for all purposes
         whatsoever, and neither the Company nor the Warrant Agent will be
         affected by any notice to the contrary;

             (c) Such Holder expressly waives any right to receive any
         fractional Warrants and any fractional securities upon exercise or
         exchange of a Warrant; and

             (d) Notwithstanding anything in this Agreement to the contrary,
         neither the Company nor the Warrant Agent will have any liability to
         any Holder or other person as a result of its inability to perform any
         of its obligations under this Agreement by reason of any preliminary or
         permanent injunction or other order, decree or ruling issued by a court
         of competent jurisdiction or by a governmental, regulatory or
         administrative agency or commission, or any statute, rule, regulation
         or executive order promulgated or enacted by any governmental
         authority, prohibiting or otherwise restraining performance of such
         obligation; PROVIDED, HOWEVER, that the Company will use reasonable
         efforts to have any such order, decree or ruling lifted or otherwise
         overturned as soon as possible.

         9. RESERVATION OF COMMON STOCK. The Company will, for so long as
Warrants remain outstanding, reserve and keep available, solely for issuance and
delivery upon the exercise of Warrants, a number of shares of Common Stock (or,
if applicable, other securities) sufficient to provide for the exercise of all
outstanding Warrants. The transfer agent for the Common Stock (or, if
applicable, other securities) will be irrevocably authorized and directed at

                                       16
<PAGE>

all times until the exercise or expiration of the Warrants to reserve such
number of authorized shares of Common Stock (or, if applicable, other
securities) as necessary for such purpose. The Company will keep copies of this
Agreement on file with the transfer agent and will supply the transfer agent
with duly executed stock certificates for such purpose.

         10. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Warrant Agent that:

             (a) The Company is a corporation duly organized, validly existing
         and in good standing under the laws of the State of Delaware and has
         all requisite corporate power and authority to execute, deliver and
         perform its obligations hereunder and to consummate the transactions
         contemplated hereby;

             (b) The execution, delivery and performance of this Agreement by
         the Company and the consummation by the Company of the transactions
         contemplated hereby have been duly authorized by all necessary
         corporate action on the part of the Company;

             (c) The execution, delivery and performance of this Agreement by
         the Company and the consummation by the Company of the transactions
         contemplated hereby in accordance with the terms hereof will not
         conflict with, violate or constitute a breach of any material contract,
         agreement or instrument by which the Company is bound or any judgment,
         order, decree, law, statute, rule, regulation or other judicial or
         governmental restriction to which the Company is subject;

             (d) This Agreement constitutes the legal, valid and binding
         obligation of the Company, enforceable against the Company in
         accordance with its terms, except as the enforceability hereof may be
         limited by bankruptcy, insolvency, reorganization, moratorium or other
         similar laws affecting creditors' rights generally; and

             (e) The Warrants, when issued and delivered to the initial Holders
         as provided in this Agreement, and the Warrant Shares issued upon
         exercise of the Warrants, when issued, paid for and delivered as
         provided in this Agreement, will be validly issued, fully paid and
         nonassessable.

         11. NOTICES. All notices, requests, waivers, releases, consents and
other communications required or permitted by this Agreement (collectively,
"NOTICES") must be in writing. Except as expressly otherwise provided herein
with respect to manner of delivery, notices will be deemed sufficiently given
for all purposes when delivered in person, when dispatched by telegram or
electronic facsimile transmission, when sent by first-class mail, postage
prepaid or upon confirmation of receipt when dispatched by a nationally
recognized overnight courier service to the appropriate party as follows: (a) if
to a Holder, at the address of such Holder as shown in the registry books
maintained by the Warrant Agent; (b) if to the Company, at 2225 Sheppard Avenue
East, 11th Floor, Atria III, Toronto, Ontario, Canada M2J 5C2, (416) 498-2466
(marked for the attention of the Chief Financial Officer and the General
Counsel), or at such other address as the Company may have furnished to the
Holders and the Warrant Agent in writing; and (c) if to the Warrant Agent, at
Sixth Street and Marquette

                                       17
<PAGE>

Avenue, MAC N9303-120, Minneapolis, MN 55479 or at such other address as the
Warrant Agent may have furnished to the Company and the Holders in writing.

         12. AMENDMENT AND WAIVER. No failure or delay of the Holder in
exercising any power or right hereunder (other than a failure to exercise
Warrants in accordance with the provisions hereof) will operate as a waiver
thereof, nor will any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No notice or demand on the Company in any case will entitle the
Company to any other or future notice or demand in similar or other
circumstances. Subject to the last sentence of this SECTION 12, (a) if the
Company so directs, the Company and the Warrant Agent will supplement or amend
this Agreement without the approval of any Holders in order to cure any
ambiguity or correct or supplement any provision contained herein which may be
defective or inconsistent with any other provisions herein and (b) the Company
and the Warrant Agent may from time to time supplement or amend this Agreement,
with the consent of Holders of at least 50% of the Warrants then outstanding,
for any other purpose. Notwithstanding anything in this Agreement to the
contrary, no supplement or amendment which increases the Warrant Price,
decreases the period of time remaining during which the Warrants may be
exercised, or changes in a manner adverse to Holders the number of Warrant
Shares purchasable upon the exercise of Warrants will be made without the
consent of all Holders. Any such amendment, modification or waiver effected
pursuant to and in accordance with the provisions of this SECTION 12 will be
binding upon all Holders and upon each future Holder, the Company and the
Warrant Agent. In the event of any such amendment, modification or waiver, the
Company will give prompt notice thereof to all Holders and, if appropriate,
notation thereof will be made on all Warrant Certificates thereafter surrendered
for registration of transfer or exchange.

         13. SUCCESSORS AND ASSIGNS. This Agreement will be binding upon and
inure to the benefit of the parties hereto, their respective successors and
permitted assigns, and, subject to SECTIONS 1.4 and 8(b), all Holders, but will
not be assignable or delegable by any party without the prior written consent of
the other parties. In the absence of such prior written consent, any purported
assignment or delegation of any right or obligation hereunder will be null and
void.

         14. RIGHTS OF THE PARTIES. Except as provided in SECTION 13, nothing
expressed or implied in this Agreement is intended or will be construed to
confer upon or give any person or entity other than the parties hereto and the
Holders any rights or remedies under or by reason of this Agreement or any
transaction contemplated hereby. All rights of action in respect of this
Agreement are vested in the Holders, and any Holder without the consent of the
Warrant Agent or any other Holder may, on such Holder's own behalf and for such
Holder's own benefit, enforce such Holder's rights hereunder, including the
right to exercise, exchange or surrender for transfer such Holder's Warrant
Certificates in accordance with the provisions hereof.

         15. TITLES AND HEADINGS. Titles and headings to Sections herein are
inserted for convenience of reference only, and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.

         16. CERTAIN INTERPRETIVE MATTERS. (a) Unless the context otherwise
requires, (i) all references to Sections or Exhibits are to Sections or Exhibits
of or to this Agreement, (ii) each

                                       18
<PAGE>

term defined in this Agreement has the meaning assigned to it, (iii) "or" is
disjunctive but not necessarily exclusive, and (iv) words in the singular
include the plural and VICE VERSA. All references to "$" or dollar amounts are
to lawful currency of the United States of America.

         (b) No provision of this Agreement will be interpreted in favor of, or
against, any party hereto by reason of the extent to which such party or its
counsel participated in the drafting of this Agreement or by reason of the
extent to which any such provision is inconsistent with any prior draft of this
Agreement.

         17. ENTIRE AGREEMENT. This Agreement, together with its Exhibits,
constitutes the entire agreement among the parties hereto with respect to the
subject matter hereof, and there are no agreements among the parties hereto with
respect thereto except as expressly set forth herein.

         18. SEVERABILITY. In case any provision contained in this Agreement is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions will not in any way be affected or impaired thereby.
The Company and the Warrant Agent will endeavor in good faith to replace the
invalid, illegal or unenforceable provisions with valid, legal and enforceable
provisions the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.

         19. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to the
principles of conflict of laws thereof.

         20. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed will be deemed to be an original; such
counterparts will together constitute but one agreement.

<PAGE>

         IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement as of the date first above written.

                             ALDERWOODS GROUP, INC.

                             By: _______________________________________
                             Name:  Bradley D. Stam
                             Title: Senior Vice President, Legal & Asset
                                    Management

                             WELLS FARGO BANK MINNESOTA,
                              NATIONAL ASSOCIATION

                             By:__________________________________________
                             Name:________________________________________
                             Title:_______________________________________

<PAGE>

                                    EXHIBIT A

                               WARRANT CERTIFICATE

                             ALDERWOODS GROUP, INC.

THE WARRANTS REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS SET FORTH IN THE WARRANT AGREEMENT (AS HEREINAFTER DEFINED), A COPY
OF WHICH WILL BE MADE AVAILABLE BY THE ISSUER UPON REQUEST. THE TRANSFER OR
EXCHANGE OF THESE WARRANTS MUST BE REGISTERED IN ACCORDANCE WITH THE WARRANT
AGREEMENT.

NO.  ___________                                      WARRANTS  _______________

                     VOID AFTER 5:00 P.M. NEW YORK CITY TIME
                             ON ___________ __, ____

         THIS CERTIFIES THAT for value received, __________, or its registered
assigns (the "HOLDER"), is the owner of the number of Warrants set forth above
that initially entitle it to purchase from Alderwoods Group, Inc., a Delaware
corporation (the "COMPANY"), at any time and from time to time on or prior to
5:00 p.m. New York City time on ____________ __, 200__ (the "EXPIRATION DATE"),
a like number of fully paid and nonassessable shares of the Common Stock, par
value $0.01 per share, of the Company (the "COMMON STOCK") at an initial
purchase price of $25.76 per share (the "WARRANT PRICE"), subject to adjustment
as provided in the Warrant Agreement. The shares of Common Stock purchasable
upon exercise of the Warrants are hereinafter referred to as the "WARRANT
SHARES." Subject to the terms and conditions of the Warrant Agreement, the
Warrants may be exercised by surrendering to the Warrant Agent (as defined
below) this Warrant Certificate, with the Form of Exercise Notice on the reverse
side hereof duly executed, together with cash, a certified or bank cashier's
check payable to the order of the Company, or a wire transfer to an account
designated by the Company, in each case in an amount of lawful currency of the
United States of America equal to the product of (a) the number of Warrant
Shares purchasable upon the exercise of the Warrants designated for exercise in
the Form of Exercise Notice and (b) the Warrant Price.

         The number and kind of Warrant Shares that may be purchased upon
exercise of the Warrants evidenced by this Warrant Certificate are the number as
of the date of the original issue of such Warrants, based on the shares of
Common Stock of the Company as constituted at such date. As provided in the
Warrant Agreement, the Warrant Price and the number and kind of Warrant Shares
purchasable upon exercise of the Warrants are subject to adjustment.

         This Warrant Certificate and the Warrants it represents are subject to,
and entitled to the benefits of, all of the terms, provisions and conditions of
the Warrant Agreement, dated as of ___________ __, 200__ (the "WARRANT
AGREEMENT"), by and between the Company and Wells Fargo Bank Minnesota, National
Association, a national banking association (the "WARRANT AGENT"), which Warrant
Agreement is hereby incorporated herein by reference and made a part hereof and
to which Warrant Agreement reference is hereby made for a full description of
the

                                       A-1

<PAGE>

rights, limitation of rights, obligations and duties hereunder of the Company
and the Holder. A copy of the Warrant Agreement will be made available to the
Holder by the Company upon request of the Holder.

         Subject to the provisions set forth in the Warrant Agreement or in this
Certificate, this Warrant Certificate, with or without other Warrant
Certificates, may be transferred, split up, combined or exchanged for another
Warrant Certificate or Warrant Certificates, entitling the Holder to purchase a
like aggregate number of Warrant Shares as the Warrant Certificate or Warrant
Certificates surrendered entitled such Holder (or former Holder in the case of a
transfer) to purchase, upon presentation and surrender hereof at the principal
office of the Warrant Agent designated for such purpose, with the Form of
Assignment (if appropriate) and the related Certificate duly executed.

         The Company will not be required to issue fractional Warrant Shares or
other fractional interests in securities upon the exercise of any Warrants
evidenced by this Warrant Certificate, but in lieu thereof a cash payment will
be made, as provided in the Warrant Agreement.

         Nothing contained in the Warrant Agreement or in this Warrant
Certificate will be construed as conferring upon the holder of this Warrant
Certificate the right to vote, or to receive dividends, or to consent or (except
as provided in the Warrant Agreement) to receive notice 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.

         This Warrant Certificate will not be valid or obligatory for any
purpose until it has been countersigned by the Warrant Agent.

                                       A-2
<PAGE>

         IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be executed by its corporate officers duly authorized.

Attest:                                                   ALDERWOODS GROUP, INC.

__________________________________          By: ________________________________
[Name, title]                                   [Name, title]

Dated:  __________, ____

Countersigned:

WELLS FARGO BANK MINNESOTA,
  NATIONAL ASSOCIATION

By:________________________________
       [Authorized Signature]

                                       A-3

<PAGE>

                   Form of Reverse Side of Warrant Certificate

                               FORM OF ASSIGNMENT

           (To be executed if the Holder desires to transfer Warrants)

                  FOR VALUE RECEIVED, __________________________________________
hereby sells, assigns, and transfers unto ______________________________________

--------------------------------------------------------------------------------
                  (Please print name and address of transferee)

-----------------------------------------------------------------------------
this Warrant Certificate, together with all right, title, and interest therein,
and does hereby irrevocably constitute and appoint _____________________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.

Dated:  ______________, ______

                                             ___________________________________
                                             Signature

Signature Guaranteed:

<PAGE>

                             FORM OF EXERCISE NOTICE

           (To be executed if the Holder desires to exercise Warrants)

TO ALDERWOODS GROUP, INC.

                  The undersigned hereby irrevocably elects to exercise
__________ Warrants evidenced by this Warrant Certificate to purchase the
Warrant Shares issuable upon the exercise of such Warrants and requests that
certificates for such Warrant Shares be issued in the name of:

--------------------------------------------------------------------------------
                         (Please print name and address)

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

Please insert social security or
other identifying number: ______________________________________________________

If such number of Warrants is not all the Warrants evidenced by this Warrant
Certificate, a new Warrant Certificate for the balance remaining of such
Warrants will be registered in the name of and delivered to:

--------------------------------------------------------------------------------
                         (Please print name and address)

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

Please insert social security
or other identifying number: ---------------------------------------------------

Dated:  _______________, _____

                                          ______________________________________
                                          Signature

Signature Guaranteed:

                                      A-5
<PAGE>

                                     NOTICE

         Signatures on the foregoing Form of Assignment and Form of Exercise
Notice and in the related Warrant Certificates must correspond to the name as
written upon the face of this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever.

         Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.

                                      A-6

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