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         THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED OR QUALIFIED FOR SALE UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED FOR
SALE, SOLD OR OTHERWISE TRANSFERRED UNLESS SUCH OFFER, SALE OR TRANSFER IS
REGISTERED OR QUALIFIED PURSUANT TO THE REGISTRATION REQUIREMENTS OF SUCH ACT
AND ANY APPLICABLE STATE SECURITIES LAWS, OR IS PRECEDED BY AN OPINION OF
COUNSEL ADDRESSED TO HORIZON PHARMACIES, INC. THAT SUCH SALE OR OTHER TRANSFER
IS EXEMPT FROM ALL SUCH REGISTRATION REQUIREMENTS.

No. WR-2004

                               WARRANT TO PURCHASE

                             SHARES OF COMMON STOCK

                                       OF

                            HORIZON PHARMACIES, INC.

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                                TABLE OF CONTENTS

<S>               <C>                                                                                            <C>
SECTION 1.        EXERCISE OF WARRANT.............................................................................1

SECTION 2.        RESERVATION.....................................................................................2

SECTION 3.        PROTECTION AGAINST DILUTION.....................................................................2
     Section 3.1       Stock Dividends, Subdivisions, and Combinations............................................2
     Section 3.2       Issuance of Additional Shares of Common Stock..............................................3
     Section 3.3       Issuance of Warrants or Other Rights, Convertible Securities...............................3
     Section 3.4       Other Provisions Applicable to Adjustments.................................................4
     Section 3.5       Extraordinary Dividends....................................................................5
     Section 3.6       Adjustment of Number of Shares Purchasable.................................................5
     Section 3.7       Minimum Adjustment.........................................................................6
     Section 3.8       Notice of Adjustments......................................................................6

SECTION 4.        MERGERS, CONSOLIDATIONS, SALES..................................................................7

SECTION 5.        DISSOLUTION OR LIQUIDATION......................................................................7

SECTION 6.        NOTICE OF DIVIDENDS.............................................................................7

SECTION 7.        FRACTIONAL SHARES...............................................................................8

SECTION 8.        FULLY PAID STOCK; TAXES.........................................................................8

SECTION 9.        CLOSING OF TRANSFER BOOKS.......................................................................8

SECTION 10.       PARTIAL EXERCISE AND PARTIAL ASSIGNMENT.........................................................8
     Section 10.1      Partial Exercise...........................................................................8
     Section 10.2      Assignment.................................................................................8

SECTION 11.       DEFINITIONS.....................................................................................9

SECTION 12.       WARRANT HOLDER NOT SHAREHOLDER.................................................................11

SECTION 13.       SEVERABILITY...................................................................................11

SECTION 14.       GOVERNING LAW..................................................................................12

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                                                          i

<PAGE>

                                                                       Warrant

No. WR-2004

                               WARRANT TO PURCHASE

                             SHARES OF COMMON STOCK

                                       OF

                            HORIZON PHARMACIES, INC.

         THIS IS TO CERTIFY that, for value received and subject to the
provisions hereinafter set forth,

                               eGrocery.com, Inc.

                            or its permitted assigns,

is entitled to purchase from HORIZON Pharmacies, Inc., a Delaware corporation
("COMPANY"), at any time and from time to time during the Exercise Period, up
to 100,000 shares of Common Stock, par value $0.01 per share, of Company,
subject to the terms, provisions and conditions hereinafter set forth at a
price per share equal to $10.00. The price per share is subject to adjustment
as hereinafter provided (such price, or such price as last adjusted, as the
case may be, being herein referred to as the "PER SHARE WARRANT PRICE"). The
said number of shares purchasable hereunder is likewise subject to adjustment
as hereinafter provided.

         The aggregate price of the Common Stock purchasable hereunder shall
at all times be equal to the price per share set forth in the preceding
paragraph multiplied by the number of shares initially purchasable hereunder.
The aggregate price is herein sometimes referred to as the "Aggregate Warrant
Price" and is not subject to adjustment.

         The terms which are capitalized herein shall have the meanings
specified in Section 11 unless the context shall otherwise require.

SECTION 1.  EXERCISE OF WARRANT.

         Subject to the conditions hereinafter set forth, this Warrant may be
exercised in whole or in part at any time and from time to time during the
Exercise Period by the surrender of this Warrant (with the subscription from
at the end hereof duly executed) at the principal office of Company in
Denison, Texas, and upon payment to Company of a sum equal to the per share
Warrant Price multiplied by the number of shares purchased in such exercise,
which payment shall be made by the wire transfer or other delivery to Company
of one or more types of Permitted Consideration.

         In the event that Warrants shall be delivered to Company as payment
of all or any portion of the purchase price payable hereunder ("Cashless
Exercise"), the amount of such purchase price deemed to be paid by means of
such delivery shall equal (a) the aggregate number of shares of

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                                                                       Warrant

Underlying Shares related to that portion of the Warrants so delivered,
multiplied by (b) the result, not less than zero, equal to (i) the Current
Market Price then in effect (with the date of the exercise of the Warrant
being deemed to be the "Issuance Date" for purposes of making determinations
under the definition of "Current Market Price") MINUS (ii) the per share
Warrant Price then in effect. The number of shares of Common Stock to be
issued to eGrocery would equal the result of the previous equation divided by
the Current Market Price.

         If this Warrant is exercised in respect of less than all of the
shares of Common Stock at the time purchasable hereunder, following such
exercise this Warrant shall be returned to the holder hereof and shall remain
exercisable in respect of such number of shares of Common Stock into which the
Warrant remains exercisable.

         This Warrant and all rights and options hereunder shall expire to the
extent that it has not been exercised on or before the Expiration Date.

         Company shall pay all reasonable expenses, stamp, documentary and
transfer taxes and other charges payable in connection with the preparation,
execution and delivery of stock certificates pursuant to this Section,
regardless of the name or names in which such stock certificates shall be
registered.

SECTION 3.  RESERVATION.

         Company will at all times reserve and keep available such number of
authorized shares of its Common Stock, solely for the purpose of issue upon
the exercise of the rights represented by this Warrant as herein provided for,
as may at any time be issuable (based upon the number of shares of Common
Stock outstanding at any such time) upon the exercise of this Warrant.

SECTION 4.  PROTECTION AGAINST DILUTION.

         The per share Warrant Price and the number of shares deliverable
hereunder shall be adjusted from time to time as hereinafter set forth:

         SECTION 3.1   STOCK DIVIDENDS, SUBDIVISIONS, AND COMBINATIONS. In
case after the date hereof Company shall:

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

                  (b) subdivide its outstanding shares of Common Stock into a
         larger number of shares of Common Stock, or

                  (c) combine its outstanding shares of Common Stock into a
         smaller number of shares of Common Stock,

then the per share Warrant Price shall be adjusted to that price determined by
multiplying the per share Warrant Price in effect immediately prior to such
event by a fraction (i) the numerator of which shall be the total number of
outstanding shares of Common Stock immediately prior to such

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                                                                       Warrant

event, and (ii) the denominator of which shall be the total number of
outstanding shares of Common Stock immediately after such event.

         SECTION 3.2   ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. In case
after the date hereof Company shall (except as hereinafter provided) issue any
Additional Shares of Common Stock for a consideration per share less than the
Current Market Price per share, then the per share Warrant Price on each such
issuance shall be adjusted to that price determined by multiplying the per
share Warrant Price in effect immediately prior to such event by a fraction:

                  (a) the numerator of which shall be the number of shares of
         Common Stock outstanding immediately prior to the issuance of such
         Additional Shares of Common Stock plus the number of full shares of
         Common Stock which the aggregate consideration for the total number of
         such Additional Shares of Common Stock so issued would purchase at the
         Current Market Price per share, and

                  (b) the denominator of which shall be the number of shares of
         Common Stock outstanding immediately prior to the issuance of such
         Additional Shares of Common Stock plus the number of such Additional
         Shares of Common Stock so issued.

         The provisions of this Section 3.2 shall not apply to any Additional
Shares of Common Stock which are distributed to holders of Common Stock as a
stock dividend or subdivision, for which an adjustment is provided for under
Section 3.1. No adjustment of the per share Warrant Price shall be made under
this Section 3.2 upon the issuance of any Additional Shares of Common Stock
which are issued pursuant to the exercise of any warrants or other
subscription or purchase rights or pursuant to the exercise of any conversion
or exchange rights in any Convertible Securities, if any such adjustment shall
previously have been made upon the issuance of such warrants or other rights
or upon the issuance of such Convertible Securities (or upon the issuance of
any warrants or other rights therefor) pursuant to Section 3.3.

         SECTION 3.3  ISSUANCE OF WARRANTS OR OTHER RIGHTS, CONVERTIBLE
SECURITIES. In case Company shall issue any warrants or other rights to
subscribe for or purchase any Additional Shares of Common Stock or issue
Convertible Securities and the consideration per share for which Additional
Shares of Common Stock may at any time thereafter be issuable pursuant to such
warrants or other rights or pursuant to the terms of such Convertible
Securities shall be less than the Current Market Price per share, then the per
share Warrant Price shall be adjusted as provided in Section 3.2 above on the
basis that:

                  (a) the maximum number of Additional Shares of Common Stock
         issuable pursuant to all such warrants or other rights or necessary to
         effect the conversion or exchange of all such Convertible Securities
         shall be deemed to have been issued as of the earlier of: (i) the date
         on which Company shall enter a firm contract or commitment for the
         issuance of such warrants, other rights or Convertible Securities or
         (ii) the date of actual issuance of such warrants, other rights or
         Convertible Securities, and

                  (b) the aggregate consideration for such maximum number of
         Additional Shares of Common Stock shall be deemed to be the minimum
         consideration received and receivable

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                                                                       Warrant

         by Company for the issuance of such Additional Shares of Common Stock
         pursuant To such warrants or other rights or pursuant to the terms OF
         such Convertible Securities.

         No adjustment of the per share Warrant Price shall be made under this
Section 3.3 upon the issuance of any Convertible Securities which are issued
pursuant to the exercise of any warrants or other subscription or purchase
rights therefor, to the extent such adjustment shall previously have been made
upon the issuance of such warrants or other rights pursuant to this Section
3.3.

         SECTION 3.4   OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS. The
following provisions shall be applicable to the making of adjustments in the
per share Warrant Price hereinbefore provided in this Section 3:

                  (a) COMPUTATION OF CONSIDERATION. To the extent that any
         Additional Shares of Common Stock or any Convertible Securities or any
         warrants or other rights to subscribe for or purchase any Additional
         Shares of Common Stock or any Convertible Securities shall be issued
         for a cash consideration, the consideration received by Company
         therefor shall be deemed to be the amount of the cash received by
         Company therefor, or, if such Additional Shares of Common Stock or
         Convertible Securities or warrants or other rights are offered by
         Company for subscription, the subscription price, or, if such
         Additional Shares of Common Stock or Convertible Securities or
         warrants or other rights are sold to underwriters or dealers for
         public offering without a subscription offering, the offering price,
         in any such case excluding any amounts paid or receivable for accrued
         interest or accrued dividends and without deduction of any
         compensation, discounts or expenses paid or incurred by Company for
         and in the underwriting thereof, or otherwise in connection with the
         issue thereof. To the extent that such issuance shall be for a
         consideration other than cash, then, except as herein otherwise
         expressly provided, the amount of such consideration shall be deemed
         to be the fair value of such consideration at the time of such
         issuance as determined in good faith by the Board of Directors of
         Company. The consideration for any Additional Shares of Common Stock
         issuable pursuant to any warrants or other rights to subscribe for or
         purchase the same shall be the consideration received by Company for
         issuing such warrants or other rights plus the additional
         consideration payable to Company upon the exercise of such warrants
         or other rights. The consideration for any Additional Shares of
         Common Stock issuable pursuant to the terms of any Convertible
         Securities shall be the consideration received by Company for issuing
         any warrants or other rights to subscribe for or purchase such
         Convertible Securities plus the consideration paid or payable to
         Company in respect of the subscription for or purchase of such
         Convertible Securities plus the additional consideration, if any,
         payable to Company upon the exercise of the right of conversion or
         exchange of such Convertible Securities. In case of the issuance at
         any time of any Additional Shares of Common Stock or Convertible
         Securities in payment or satisfaction of any dividend upon any class
         of equity securities other than Common Stock, Company shall be deemed
         to have received for such Additional Shares of Common Stock or
         Convertible Securities a consideration equal to the amount of such
         dividend so paid or satisfied.

                  (b) READJUSTMENT OF PER SHARE WARRANT PRICE. Upon expiration
         of the right of exercise, conversion or exchange of any Convertible
         Securities, or upon the expiration of any rights, options or warrants,
         or upon the termination of any firm contract or commitment for the
         issuance of such rights, options, warrants or Convertible Securities,
         or upon any increase

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                                                                       Warrant

         in the minimum consideration receivable by Company for the issuance
         of Additional Shares of Common Stock pursuant to such Convertible
         Securities, rights, options or warrants, if any such Convertible
         Securities shall not have been exercised, converted or exchanged, or
         if any such rights, options or warrant shall not have been exercised,
         the number of shares of Common Stock deemed to be issued and
         outstanding by any reason of the fact that they were issuable upon
         exercise, conversion or exchange of any such Convertible Securities
         or upon exercise of any such rights, options or warrants shall no
         longer be computed as set forth above, and the per share Warrant
         Price shall forthwith be readjusted and thereafter be the price which
         it would have been (but reflecting any other adjustments in the per
         share Warrant Price made pursuant to the provisions of this Section 3
         after the issuance of such Convertible Securities, rights, options or
         warrants) had the adjustment of the per share Warrant Price made upon
         the issuance or sale of such Convertible Securities or the issuance
         of such rights, options or warrants been made on the basis of the
         issuance only of the number of Additional Shares of Common Stock
         actually issued upon exercise, conversion or exchange of such
         Convertible Securities or upon the exercise of such rights, options
         or warrants, or upon the basis of such increased minimum
         consideration, as the case may be, and thereupon only the number of
         Additional Shares of Common Stock actually so issued plus the number
         thereof then issuable upon the basis of such increased minimum
         consideration shall be deemed to have been issued and only the
         consideration actually received plus shall increased minimum
         consideration receivable by Company (computed in accordance with
         Section 3.4(a)) shall be deemed to have been received by Company.

                  (c) ROUNDING OF PER SHARE WARRANT PRICE. Any determination of
         per share Warrant Price hereunder shall be expressed in United States
         Dollars, cents and portions of cents and shall be rounded to the
         nearest 1/1000 of one cent or, if there is no nearest 1/1000 of one
         cent, to the next highest 1/1000 of one cent.

         SECTION 3.5   EXTRAORDINARY DIVIDENDS. In case Company shall declare
a dividend upon its Common Stock (except a dividend payable in shares of
Common Stock referred to in Section 3.1(a) or a dividend payable in warrants,
rights or Convertible Securities referred to in Section 3.3) payable otherwise
than out of earnings or surplus (other than revaluation surplus or paid-in
surplus), the per share Warrant Price in effect immediately prior to the
declaration of such dividend shall be reduced by an amount equal, in the case
of a dividend in cash, to 10% of the amount thereof payable per share of
Common Stock or, in the case of any other dividend, to the fair value thereof
per share of Common Stock as determined in good faith by the Board of
Directors of Company. For the purposes of the foregoing, a dividend payable
other than in cash shall be considered payable out of earnings or surplus
(other than revaluation surplus or paid-in surplus) only to the extent that
such earnings or surplus are charged an amount equal to the fair value of such
dividend as determined by the Board of Directors of Company. If such dividend
is paid or Company declares and becomes legally liable to pay such dividend,
such reduction shall take effect as of the date on which a record is taken for
the purpose of such dividend or, if a record is not taken, the date as of
which the holders of the Common Stock of record entitled to such dividend are
to be determined. Appropriate readjustment of the per share Warrant Price
shall be made in the event that any dividend referred to in this Section 3.5
shall be lawfully abandoned.

         SECTION 6.   ADJUSTMENT OF NUMBER OF SHARES PURCHASABLE. Upon each
adjustment of the per share Warrant Price, the number of shares of Common
Stock purchasable hereunder shall be

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                                                                       Warrant

adjusted by multiplying the number of shares of Common Stock purchasable
hereunder immediately prior to such adjustment of the per share Warrant Price
by a fraction, the numerator of which shall be the per share Warrant Price in
effect immediately prior to such adjustment and the denominator of which shall
be the per share Warrant Price in effect immediately following such adjustment.

         SECTION 3.7   MINIMUM ADJUSTMENT. Except as hereinafter provided, no
adjustment of the per share Warrant Price hereunder shall be made if such
adjustment results in a change of the per share Warrant Price then in effect
of less than 1%. Any adjustment of less than 1% shall be carried forward and
shall be made at the time of and together with any subsequent adjustment
which, together with the adjustment or adjustments so carried forward, amounts
to 1% or more of the per share Warrant Price then in effect. However, upon the
exercise of this Warrant, Company shall make all necessary adjustments not
theretofore made to the per share Warrant Price up to and including the date
upon which this Warrant is exercised.

         SECTION 3.8   NOTICE OF ADJUSTMENTS

                  (a) Whenever the per share Warrant Price or number of shares
         deliverable upon exercise of this Warrant shall be adjusted pursuant
         to this Section 3, Company shall promptly prepare a certificate signed
         by the President or a Vice President and by the Treasurer of Company
         setting forth, in reasonable detail, the event requiring the
         adjustment, the amount of the adjustment, the method by which such
         adjustment was calculated (including a description of the basis on
         which the Board of Directors of Company made any determination
         hereunder), and shall promptly cause copies of such certificate to be
         mailed in the manner provided in Section 12.1 of the Warrant Agreement
         to the holder of this Warrant.

                  (b) The adjustment set forth in the certificate furnished
         pursuant to Section 3.8(a) shall be final and binding unless, within
         90 days after receipt thereof, the Majority Holders of the Warrants
         deliver to Company a written statement of objection to such
         adjustment.

                           (i) In the event of any such statement of objection
                  by said Majority Holders, Company's accountants and a firm of
                  independent public accountants selected by said Majority
                  Holders shall attempt to prepare a computation in which both
                  accountants concur. Any such joint computation shall be set
                  forth in a joint certificate to each holder of the Warrants
                  and Company and shall be final and binding.

                           (ii) If Company's accountants and said Majority
                  Holders' accountants are unable to resolve their differences
                  within 30 days after the receipt by Company of said Majority
                  Holders' statement of objection, they shall submit the matter
                  to a third firm of independent certified public accountants
                  of nationally recognized standing agreed upon by said
                  Majority Holders and Company or, if said Majority Holders
                  and Company are unable to agree within 10 days after the
                  expiration of said 30-day period, to such firm designated by
                  the then president of the state society of certified public
                  accountants for the state in which Company maintains its
                  principal place of business. Such third firm of accountants
                  shall thereupon compute the amount of the adjustment and,
                  upon completion of such computation, shall transmit its
                  certificate

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                  to each holder of the Warrants and Company setting forth
                  such computations, which shall be final and binding.

                           (iii) The fees and expenses of all accountants
                  referred to in this Section 3.8(b) shall be borne by Company.

SECTION 4.  MERGERS, CONSOLIDATIONS, SALES.

         In the case of any consolidation or merger of Company with another
entity, or the sale of all or substantially all of its assets to another
entity, or any reorganization, recapitalization or reclassification of the
Common Stock or other equity securities of Company, then, as a condition of
such consolidation, merger, sale, reorganization, recapitalization or
reclassification, lawful and adequate provision shall be made whereby the
holder of this Warrant shall thereafter have the right to receive upon the
basis and upon the terms and conditions specified herein and in lieu of the
shares of Common Stock immediately theretofore purchasable hereunder, such
shares of stock, securities or assets as may (by virtue of such consolidation,
merger, sale, reorganization or reclassification) be issued or payable with
respect to or in exchange for a number of outstanding shares of Common Stock
equal to the number of shares of Common Stock immediately theretofore so
purchasable hereunder had such consolidation, merger, sale, reorganization,
recapitalization or reclassification not taken place. In any such case,
appropriate provisions shall be made with respect to the rights and interest
of the holder of this Warrant to the end that the provisions hereof shall
thereafter be applicable, as nearly as may be, in relation to any shares of
stock, securities or assets thereafter deliverable upon exercise of this
Warrant. Company shall not effect any such consolidation, merger or sale,
unless prior to or simultaneously with the consummation thereof, the successor
entity (if other than Company) resulting from such consolidation or merger or
the entity purchasing such assets shall assume by written instrument executed
and mailed or delivered to the holder of this Warrant, the obligation to
deliver to such holder such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such holder may be entitled to
receive.

SECTION 5.  DISSOLUTION OR LIQUIDATION.

         In the event of any proposed distribution of the assets of Company in
dissolution or liquidation except under circumstances when the foregoing
Section 4 shall be payable, Company shall mail notice thereof to the holder of
this Warrant and shall make no distribution to shareholders until the
expiration of 30 days from the date of mailing of the aforesaid notice and, in
any such case, the holder of this Warrant may exercise the purchase rights
with respect to this Warrant within 30 days from the date of mailing such
notice and all rights herein granted not so exercised within such 30-day
period shall thereafter become null and void.

SECTION 6.  NOTICE OF DIVIDENDS.

         If the Board of Directors of Company proposes to declare any dividend
or other distribution on its Common Stock, except by way of a stock dividend
payable on its Common Stock, Company shall mail notice thereof to the holder
of this Warrant as soon as possible (such notice being referred to as the
"DISTRIBUTION NOTICE"). Company shall not fix a record date until the lapse of
a 10-day period beginning on the date of delivery of the Distribution Notice.
The holder of this Warrant shall not participate in such dividend or other
distribution or be entitled to any rights on account or as a

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result thereof unless and to the extent that this Warrant is exercised prior
to such record date. The provisions of this paragraph shall not apply to
distributions made in connection with transactions covered by Section 4.

SECTION 7.  FRACTIONAL SHARES.

         No fractional shares may be issued upon the exercise of this Warrant.
In the event that a Holder would otherwise be entitled to a fractional share
except for the operation of the previous sentence, in lieu of such fractional
share such Holder shall be paid a cash amount equal to (i) such fraction
multiplied by (ii) the Current Market Value of one full share of Common Stock
on the date of exercise.

SECTION 8.  FULLY PAID STOCK; TAXES.

         Company covenants and agrees that the shares of stock represented by
each and every certificate for its Common Stock to be delivered on the
exercise of the purchase rights and the payment of the applicable purchase
price herein provided for shall, at the time of such delivery, be validly
issued and outstanding and be fully paid and nonassessable. Company further
covenants and agrees that it will pay when due and payable any and all federal
and state taxes (other than income taxes) which may be payable in respect of
this Warrant or any Common Stock or certificates therefor upon the exercise of
the rights herein and in the Warrant Agreement provided for pursuant to the
provisions hereof and thereof. Company shall not, however, be required to pay
any tax which may be payable solely in respect of any transfer and delivery of
stock certificates in a name other than that of the holder exercising this
Warrant, and any such tax shall be paid by such holder at the time of
presentation.

SECTION 9.  CLOSING OF TRANSFER BOOKS.

         The right to exercise this Warrant shall not be suspended during any
period that the stock transfer books of Company for its Common Stock may be
closed. Company shall not be required, however, to deliver certificates of its
Common Stock upon such exercise while such books are duly closed for any
purpose, but Company may postpone the delivery of the certificates for such
Common Stock until the opening of such books, and they shall, in such case, be
delivered forthwith upon the opening thereof, or as soon as practicable
thereafter.

SECTION 10.  PARTIAL EXERCISE AND PARTIAL ASSIGNMENT.

         SECTION 10.1   PARTIAL EXERCISE. If this Warrant is exercised in part
only, the holder hereof shall surrender this Warrant upon such exercise for
endorsement thereon of the number of shares of Common Stock as to which it has
been exercised. No partial exercise of this Warrant shall be made in respect
of shares of Common Stock of Company representing less than 1% of Pro Forma
Shares.

         SECTION 10.2   ASSIGNMENT. (a) Subject to the conditions set forth in
Section 10.2(b) hereof, this Warrant may be assigned either in whole or in
part by surrender of this Warrant at the principal office of Company in
Denison, Texas (with the assignment or, as the case may be, partial assignment
form at the end hereof duly executed). If this Warrant is being assigned in
whole, the assignee shall receive a new Warrant (registered in the name of
such assignee or its nominee) which new Warrant shall cover 100% of the number
of shares of Common Stock then purchasable hereunder and shall

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                                                                       Warrant

set forth the Aggregate Warrant Price. If this Warrant is being assigned in
part, the assignor and assignee shall each receive a new Warrant (which, in
the case of the assignee, shall be registered in the name of the assignee or
its nominee), which new Warrants shall cover the number of shares of Common
Stock then purchasable hereunder not so assigned and so assigned,
respectively, and shall set forth the proportionate Aggregate Warrant Price
applicable to such shares.

         (b) Neither this Warrant nor any Warrant Shares may be sold, assigned
or otherwise transferred unless such sale, assignment or transfer is
registered or qualified pursuant to the registration requirements of the
Securities Act of 1933, as amended, and all applicable state securities laws,
or is preceded by an opinion of counsel addressed to Company that such sale,
assignment or other transfer is exempt from all such registration
requirements; PROVIDED, HOWEVER, that no such opinion of counsel shall be
required in connection with any such sale, assignment or transfer to any
affiliate of the holder of this Warrant or any Warrant Shares issued in
respect hereof. The fees and expenses of such counsel incurred in respect of
such sales, assignments or transfers shall be paid by the holder of this
Warrant or any Warrant Shares which are the subject of such proposed sale,
assignment or transfer. All certificates representing the Warrant Shares shall
be stamped or imprinted with an appropriate restrictive legend, substantially
as set forth on the cover page hereof.

SECTION 11.  DEFINITIONS.

         Terms not otherwise defined herein shall have the respective meanings
assigned thereto in the Warrant Agreement and the Credit Agreement. In
addition to the terms defined elsewhere in this Warrant, the following terms
have the following respective meanings:

         "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares of Common
Stock issued by Company after the Closing Date, except:

               (a) Common Stock issued upon exercise of the Warrants;

               (b) Common Stock issued upon exercise of warrants issued under
the Existing Warrant Agreements; and

               (c) Common Stock issued to officers, directors or employees of,
or consultants to, Company pursuant to any existing or future stock option,
incentive, bonus or compensation plan or program approved by the Company's
shareholders (no later than 12 months following adoption of the plan or
program by the Company's Board of Directors).

         "AGGREGATE WARRANT PRICE" has the meaning specified on the first page
of this Warrant.

         "CASHLESS EXERCISE" has the meaning specified in Section 1.

         "COMMON STOCK" shall mean the shares of Common Stock, par value $0.01
per share, of Company described in the Certificate of Incorporation.

         "CONVERTIBLE SECURITIES" shall mean evidences of indebtedness,
equity, rights, options, warrants or other securities which are convertible
into or exchangeable for shares of Common Stock,

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                                                                       Warrant

either immediately or upon the arrival of a specified date or the happening of
a specified event, or otherwise.

         "CURRENT MARKET PRICE" shall mean, at the date of determination
thereof, an amount equal to the market price on the Business Day occurring
most recently prior to the subject issuance of such shares of Common Stock
(the "ISSUANCE DATE"). The market price for such Business Day shall be the
last sale price on such day on the American Stock Exchange, or, if the Common
Stock is not then listed or admitted to trading on the American Stock
Exchange, on such other principal stock exchange on which such shares are then
listed or admitted to trading, or, if no sale takes place on such day on any
such exchange, the average of the closing bid and asked prices on such day as
officially quoted on any such exchange, or, if the Common Stock is not then
listed or admitted to trading on any stock exchange, the market price for each
such Business Day shall be the last reported sale price on such day on The
Nasdaq Stock Market's National Market or The Nasdaq Stock Market's Small Cap
Market, as furnished by Nasdaq, or, if no sale takes place on such day on such
system, the average of the closing bid and asked prices on such day as
officially quoted by Nasdaq, or, if such price at the time is not available
from such system, the market price for such Business Day shall be the average
of the reported closing bid and asked prices on such day in the
over-the-counter market, as furnished by Nasdaq, or, if such price at the time
is not available from such system, such price shall be determined in good
faith by Company's Board of Directors, which shall be evidenced by a notice
setting forth such determination in reasonable detail (including computations
and assumptions used) (THE "CMP COMPUTATION NOTICE") to each holder of the
Warrants not later than 30 days after the issuance date of the Common Stock
giving rise to such determination (the "CMP COMPUTATION DATE") setting forth
such determination and setting forth in detail the rights and procedures the
holders of the Warrants may take in the event the Majority Holders do not
agree with the valuation set forth in the CMP Computation Notice, PROVIDED,
that if the Majority Holders of such Warrants shall object to the valuation
contained in the CMP Computation Notice in writing to Company within 15 days
of the CMP Computation Date, an Appraiser, the expenses of whom shall be paid
by said Majority Holders, shall be selected by Company and said Majority
Holders (on behalf of all of the holders of the Warrants as a class), or, if
said Majority Holders and Company are unable to agree upon the selection of an
Appraiser within 10 days of the date of the written notice from said Majority
Holders to Company objecting to the CMP Computation Notice, by the American
Arbitration Association. Said Majority Holders and Company shall be jointly
responsible for engaging the Appraiser finally selected. In the event that the
Majority Holders do not object to the CMP Computation Notice within 15 days
after receiving the CMP Computation Notice, then the value shall be that which
was determined solely by Company's Board of Directors. The Appraiser appointed
pursuant to the foregoing procedure shall be instructed to determine such
value within 15 days after the selection of such Appraiser, and any such
determination made by the Appraiser shall be final and binding upon the
parties. Notwithstanding the foregoing, in the event that, on the Issuance
Date, shares of Common Stock shall be offered for sale to the public in
connection with an underwritten public offering, the Current Market Price in
respect of said Issuance Date shall be deemed to be the price at which said
shares are initially sold to the public.

         "EXERCISE DATE" shall mean a date on which this Warrant is exercised.

         "EXERCISE PERIOD" means the period of time from the Exercise Date
until, and including, the Expiration Date.

                                     10

<PAGE>

                                                                       Warrant

         "EXPIRATION DATE" means from and after 5:00 p.m. Denison, Texas time
on April 5, 2003, the third anniversary of issuance of Warrant.

         "MAJORITY HOLDERS" shall mean, at the time of any determination, the
holders of a majority of the Warrants (determined by the number of shares of
Common Stock represented by each such Warrant as if exercised).

         "PER SHARE WARRANT PRICE" is defined in the first paragraph of this
Warrant.

         "PERMITTED CONSIDERATION" shall mean each of the following (or any
combination thereof):

               (a) cash or other funds immediately available to Company; and

               (b) Warrants.

         "PRO FORMA SHARES" shall mean, as of the date of any determination
thereof, the sum of (i) the total number of outstanding shares of Common
Stock, plus (ii) the total number of shares of Common Stock issuable upon
exercise of the Warrants and any other warrants, options or other rights and
upon the exercise of any conversion or exchange rights with respect to
Convertible Securities.

         "UNDERLYING SHARES" shall mean the shares of Common Stock issuable
upon exercise of any of the Warrants and any references contained herein to a
holder or holders of any Underlying Shares shall be deemed to refer to the
holder of the Warrants relating thereto.

         "WARRANT PRICE" - see the definition of "per share Warrant Price".

         "WARRANT SHARES" shall mean shares of Common Stock issued upon
exercise of the warrants.

         "WARRANTS" as used herein shall refer to, collectively, this Warrant
and all other warrants issued in exchange or substitution for this Warrant.

SECTION 12.  WARRANT HOLDER NOT SHAREHOLDER.

         This Warrant does not confer upon the holder hereof any right to vote
or to consent or to receive notice as a shareholder of Company, as such, in
respect of any matters whatsoever, or any other rights or liabilities as a
shareholder, prior to the exercise hereof as hereinbefore provided.

SECTION 13.  SEVERABILITY.

         Should any part of this Warrant for any reason be declared invalid or
unenforceable, such decision shall not affect the validity or enforceability
of any remaining portion, which remaining portion shall remain in force and
effect as if this Warrant had been executed with the invalid or unenforceable
portion thereof eliminated, and it is hereby declared the intention of the
parties hereto that they would have executed and accepted the remaining
portion of this Warrant without including therein any such part, parts or
portion which may, for any reason, be hereafter declared invalid or
unenforceable.

                                     11

<PAGE>

                                                                       Warrant

SECTION 14.  GOVERNING LAW.

         This Warrant shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of Texas
excluding choice-of-law principles of the law of such state that would require
the application of the laws of a jurisdiction other than such state.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                     12

<PAGE>

                                                                       Warrant

         IN WITNESS WHEREOF, Company has caused this Warrant to be signed by a
duly authorized officer and to be dated this 5th day of April, 2000.

                                      HORIZON PHARMACIES, INC.

                                      By: /s/ Ricky D. McCord
                                         --------------------------------------
                                               Name:  Ricky D. McCord
                                               Title:  President and CFO

                                    S-1<PAGE>

                         COOPERATIVE MARKETING AGREEMENT

     THIS COOPERATIVE MARKETING AGREEMENT (the "Agreement") dated as of April
6, 2000 (the "EFFECTIVE DATE"), is entered into by and between eGrocery.com,
Inc., a Minnesota corporation ("EG"), and HORIZON Pharmacies, Inc., a Delaware
corporation ("HZP"). EG and HZP are collectively the "PARTIES" and each is
individually a "PARTY."

                                   WITNESSETH

     WHEREAS, EG provides in-store and online media tools promoting consumer
brand awareness and product sales;

     WHEREAS, HZP is engaged in the business of, among other things, operating
retail drugstores and selling pharmaceuticals, health and beauty care
products, and home medical equipment; and

     WHEREAS, both EG and HZP desire that HZP promote its business to EG's
users and offer for sale to EG's users through the EG web site
pharmaceuticals, health and beauty care products, and home medical equipment.

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

SECTION 1.  DEFINITIONS

     The following terms (and their derivations) are used in this Agreement
with the respective meanings set forth below:

     "AFFILIATE" means, with respect to either Party, any individual or entity
that, directly or indirectly (through one or more intermediaries) controls, is
controlled by or is under common control with that Party.

     "ALLIANCE PARTNER" shall mean an entity maintaining or operating a web
site(s) not hosted by EG that has elected to participate through EG in one or
more of EG's programs.

     "CONTROL" (including the terms "CONTROLLED," "CONTROLLED BY," and "UNDER
COMMON CONTROL WITH"), for the purposes of determining an "Affiliate," means
the possession, directly or indirectly or as trustee or executor, of the power
to direct or cause the direction of the management or policies of an
individual or entity, whether through the ownership of stock, as trustee or
executor, by contract or credit arrangement or otherwise.

     "CORPORATE GROCER" shall mean a Grocer or wholesaler maintaining Links
via EG specifications that represents a store count of twenty-five (25) or
more affiliated individual retail grocery stores.

     "EG SITES" include, but are not limited to, any web site that is at any
time during the Term of this Agreement maintained or operated by EG or any of
its participating Affiliates or Alliance Partners, including, but not limited
to, www.egrocery.com and www.groceryshopping.net.

     "INTELLECTUAL PROPERTY RIGHTS" means all forms of intellectual property
rights and protections, including, without limitation, all right, title and
interest in and to all patents (including all filed, pending or potential
applications for letters patent), copyrights, trade names, trade secrets,
Marks and any other intellectual property rights.

     "FULFILLMENT COST" means any cost associated with filling an Order
including, but not limited to, (a) the cost to HZP of the drugs or other goods
supplied in the Order, (b) the reasonable allocable cost of a pharmacist to
fill the Order, (c) the cost to HZP of the bottles for, and labeling of, the
Order and other supplies associated with the Order, and (d) a reasonable
allocable cost for overhead and operating expenses.

                                      1

<PAGE>

     "GROCER" means a company in the business of providing groceries to retail
customers that maintains a Link by participating as an EG Affiliate or
Alliance Partner on the EG Sites.

     "GROCER LIST" means any list of third party providers located on the EG
Sites including, but not limited to, the Grocers.

     "GROCER LISTING" means, with respect to any person or entity, any
promotional piece related to the person or entity (including related marketing
and promotional materials and graphical or text Links) which is included in or
associated with any Grocer List.

     "GROCER SITE" means a web site of a Grocer through EG or one of its
Affiliates or Alliance Partners.

     "HZP LINK" means a Link from a page of the EG Sites to a page of the HZP
Site.

     "HZP SITE" means the web site maintained and operated by HZP located at
www.horizonscripts.com.

     "KIOSK" means a self-standing unit placed in a Grocer's physical grocery
store that contains a computer with a Link to the HZP Site; provided, however,
kiosk shall not include the Money Board coupon system.

     "KIOSK USER" means an individual who uses a Kiosk to connect to the HZP
Site.

     "LINK" is a textual placement or graphical button containing a direct
Internet connection between two URLs, without any intermediate URLs, so that a
user can complete the connection with a single click of a computer mouse or
similar device.

     "LINKED USER" means any user of the EG Sites who executes a HZP Link and
is connected to the HZP Site. Once a user becomes a defined "linked user" they
always remain a defined "linked user".

     "MARKS" means a Party's trademarks, tradenames, service marks, symbols,
logos, brand names, Internet domain names and other proprietary indicia of a
Party under common law, state law, federal law and laws of foreign countries.

     "NET PROFIT" means gross proceeds from an Order less Fulfillment Costs,
the Linked User Fee or Kiosk Fee (as defined in Section 4.1), any applicable
taxes, credit card processing fees, miscellaneous processing fees, the cost to
HZP of shipping and handling the Order to the customer, and any proceeds
attributable to returned products that were previously included in "Net
Profit."

     "OFFENSIVE MATERIAL" means material that infringes the intellectual
property or privacy rights of a third party; is obscene; is defamatory; or
otherwise gives rise, or is likely to give rise, to criminal or civil
liability.

     "ORDER" means a transaction between HZP and a customer whereby a customer
orders one or more products from HZP at any one time and remits payment for
such products.

     "USER DATA" is identifying information relating to a Linked User or Kiosk
User, including, but not limited to, information regarding the following:
profile and personal interests, pattern of use, addresses and telephone
numbers, and financial and credit situation.

SECTION 2.  PROMOTIONAL PLACEMENTS AND LINKAGE

     2.1.      At least 10 business days before the Target Launch Date (as
defined below), HZP shall furnish EG with full color representations of, and
technical specifications for, the Promotional Placements (as defined in
Section 2.2). The graphics and content of the Promotional Placements will be
subject to EG's approval, which may not be unreasonably withheld.

     2.2.      During the term of this Agreement, EG will post and maintain
certain Links, advertisements and listings (collectively, the "PROMOTIONAL
PLACEMENTS") on the EG Sites, as follows: (a) EG will list HZP in all EG

                                      2

<PAGE>

Sites related to pharmaceuticals and home medical equipment; (b) EG will post
HZP Links under a heading indicating that such Link is related to
pharmaceuticals on (i) the main pages of the EG Sites and each Grocer Site
and/or (ii) other relevant pages of the EG Sites and each Grocer Site; (c) EG
will post HZP Links to, and banner advertisements for, the HZP Site on such
other pages of the EG Sites and the Grocer Sites as the parties mutually and
reasonably agree and deem appropriate.

SECTION 3.  IMPLEMENTATION

     3.1.      EG will use all commercially reasonable efforts to design,
implement and put in operation the Promotional Placements, subject to HZP's
approval which may not be unreasonably withheld, at a future date to be
mutually agreed upon (the "TARGET LAUNCH DATE"), but in no event shall the
Target Launch Date occur after September 1, 2000, or, if that is not
practicable, by the first practicable subsequent date. The actual date of
initial exchange of data in actual commercial use (not in a test mode) between
the HZP Links and the HZP Site is the "ACTUAL LAUNCH DATE."

     3.2.      EG will maintain the Promotional Placements, and HZP will
maintain the HZP Site, during the Term (as defined below) of this Agreement.

     3.3.      Each Party will assign an account manager to facilitate
coordination of the Parties' performance of their obligations under this
Agreement. Either Party may change its account manager from time to time, and
will promptly notify the other Party of any change.

     3.4.      EG will use all commercially reasonable efforts to generate
cooperative advertising dollars (the "COOPERATIVE ADVERTISING REVENUE") from
general merchandise, trade funds, and display allowances on behalf of HZP at
HZP owned or managed stores. HZP retains the right to generate advertising
dollars from general merchandise, trade funds, and display allowances by,
through, and from its own efforts. For purposes of this Agreement, Cooperative
Advertising Revenue will include all advertising revenues generated by,
through, or from sources other than EG, except as set forth in Schedule A
hereto.

     3.5.      EG will use all commercially reasonable efforts to identify,
employ, and retain in employment an expert in the area of maximizing and
capturing advertising revenues (the "EXPERT"). The Expert, as an employee of
EG, will devote a considerable portion of his or her time to maximizing and
capturing the advertising revenues subject to this Agreement and will use
commercially reasonable efforts to generate advertising revenues for the HZP
Site.

     3.6.      HZP will be the exclusive provider of pharmaceuticals and home
medical equipment on websites located at www.egrocery.com and
www.groceryshopping.net and any other sites maintained by EG that contain
similar content. HZP will also be the exclusive provider of pharmaceuticals
and home medical equipment on EG Sites; provided, however, such exclusivity
requirement shall not apply to sites operated by Grocers with pre-existing
retail pharmaceutical operations. For all other EG sites, HZP will be promoted
as the preferred provider of pharmaceuticals and home medical equipment.

SECTION 4.  COMPENSATION

     4.1.      During the Term of this Agreement, HZP will pay to EG the
following cash payments: (a) 40% of the Net Profits generated from all Orders
by Linked Users and Kiosk Users; provided, that in the event that proceeds
from Orders originating from a single Grocer Site or Kiosk exceed $10,000 per
month, HZP will pay EG 50% of the Net Profits derived from the portion of
proceeds exceeding $10,000 originating from that particular Grocer Site or
Kiosk; provided, however, that the percentage of Net Profits to be paid to EG
from Orders by Linked Users and Kiosk Users originating through Corporate
Grocers shall not be subject to the preceding clause, but rather will be
negotiated in good faith between EG and HZP (the "REVENUE-BASED FEES"); (b)
$.50 per Order placed by a Linked User on the HZP Site (the "LINKED USER
FEES"); and (c) $.25 per Order placed through a Kiosk (the "KIOSK FEES" and
together with the Linked User Fees and the Revenue-Based Fees, the
"TRANSACTION FEES").

                                      3

<PAGE>

     4.2.      HZP will pay the Transaction Fees on a monthly basis. Within 15
days following the end of each month occurring subsequent to the Launch Date,
HZP shall deliver the Transaction Fees to EG that accrued during that month.

     4.3.      HZP will deliver the Transaction Fees and the EG Traffic
Reports (as defined in Section 5.2) to EG at the address on the signature page
of this Agreement, marked "ATTN: Accounting Department."

     4.4.      EG shall have the right, upon no less than 15 days' advance
written notice to HZP, to have an independent certified public accountant
inspect and audit the books and records of HZP directly associated with HZP's
obligations to make payments under this Agreement. Any such audit will be
conducted during HZP's normal business hours. Any shortfall or overpayment
identified as a result of such audit will, in the absence of a good faith
dispute, be paid promptly by the appropriate Party. EG will bear the costs of
any such audit. However, if a shortfall in payments due to EG is found which
exceeds 10 percent of the total payments due to EG for the reporting period
audited, HZP shall promptly reimburse EG for all reasonable costs of the
audit. EG's audit and audit reimbursement rights under this Section 4.4 will
survive for a period of 6 months following expiration or termination of this
Agreement.

     4.5.      (a)    EG will pay by cash payment on a monthly basis to HZP
66.67% of the Cooperative Advertising Fees. For purposes of this Agreement,
"COOPERATIVE ADVERTISING FEES" means Cooperative Advertising Revenues
generated pursuant to Section 3.4 less direct costs of generating the
Cooperative Advertising Revenues (not including any costs other than
reasonable costs directly associated with generating Cooperative Advertising
Revenues). Within 15 days following the end of each month occurring subsequent
to the Launch Date, EG shall deliver the Cooperative Advertising Fees received
by EG to HZP that accrued during that month.

               (b)    HZP will pay by cash payment on a monthly basis to EG
33.33% of the Cooperative Advertising Fees paid to HZP. Within 15 days
following the end of each month occurring subsequent to the Launch Date, HZP
shall deliver the Cooperative Advertising Fees received by HZP to EG that
accrued during that month.

     4.6       EG will pay by cash payment on a monthly basis to HZP 33.33% of
the HZP Site Fees. For purposes of this Agreement, "HZP SITE FEES" means all
gross advertising revenues generated by EG pursuant to Section 3.5 and derived
from advertisements on the HZP Site less all reasonable and direct costs of
obtaining and producing such advertising on the HZP Site; provided, however,
that in no event shall EG be required to pay HZP any gross advertising
revenues generated by EG that are wholly unrelated to HZP or the HZP Site. The
advertising costs described in the previous sentence shall not include any
costs other than reasonable costs directly associated with placing advertising
on the HZP Site. Within 15 days following the end of each month occurring
subsequent to the Launch Date, EG shall deliver to HZP the HZP Site Fees that
accrued during that month. In no event will HZP be required or obligated to
make any payment, or give any credit for payment, to EG pursuant to this
Section 4.6.

     4.7       EG will deliver the Cooperative Advertising Fees, the HZP Site
Fees, and the HZP Traffic Reports (as defined in Section 5.1) to HZP at the
address on the signature page of this Agreement, marked "ATTN: Accounting
Department."

     4.8       HZP shall have the right, upon no less than 15 days' advance
written notice to EG, to have an independent certified public accountant
inspect and audit the books and records of EG directly associated with EG's
obligations to make payments under this Agreement. Any such audit will be
conducted during EG's normal business hours. Any shortfall or overpayment
identified as a result of such audit will, in the absence of a good faith
dispute, be paid promptly by the appropriate Party. HZP will bear the costs of
any such audit. However, if a shortfall in payments due to HZP is found which
exceeds 10 percent of the total payments due to HZP for the reporting period
audited, EG shall promptly reimburse HZP for all reasonable costs of the
audit. HZP's audit and audit reimbursement rights under this Section 4.8 will
survive for a period of 6 months following expiration or termination of this
Agreement.

SECTION 5.  TRAFFIC AND USER DATA

     5.1.      During the Term of this Agreement EG will deliver to HZP within
15 days following the end of each month a reasonably detailed report
describing for the month the calculation of the Cooperative Advertising

                                      4

<PAGE>

Fees paid to EG and the HZP Site Fees (the "HZP TRAFFIC REPORTS"). The HZP
Traffic Reports will be delivered promptly at EG's cost, to HZP in a form and
via a distribution method mutually agreed upon by the Parties.

     5.2.      During the Term of this Agreement, HZP will deliver to EG
within 15 days following the end of each month a reasonably detailed report
describing for the month the calculation of the Cooperative Advertising Fees
paid to HZP and the Transaction Fees (the "EG TRAFFIC REPORTS"). The EG
Traffic Reports will be delivered promptly, at HZP's cost, to EG in a form and
via a distribution method mutually agreed upon by the Parties.

     5.3.      The HZP Traffic Reports and the EG Traffic Reports will be
deemed to be the Confidential Information (as defined below) of both Parties,
and both Parties will share in the ownership of the HZP Traffic Reports and
the EG Traffic Reports (including, without limitation, the rights to use any
of the HZP Traffic Reports or the EG Traffic Reports, which use will be
subject to the limitations of Section 8 and to all applicable privacy laws).

SECTION 6.  QUALITY CONTROL; LIMITED EXPRESS WARRANTIES

     6.1.      HZP will promptly respond to and resolve, in a commercially
reasonable manner, all complaints it receives (directly or indirectly)
regarding the products and services offered to Linked Users and Kiosk Users by
HZP, and all written complaints it receives (directly or indirectly) from a
Grocer with which EG has a contractual relationship.

     6.2.      If HZP makes a reasonable good faith determination that the EG
Site contains Offensive Material and delivers notice of such to EG, EG shall
immediately suspend and remove all links on the EG Sites to the HZP Site, or
otherwise block access to the Offensive Material by reliable technical means
until such Offensive Material is removed. If EG fails to remove from the EG
Site, or make appropriate modifications to the content of, the Offensive
Material, and that failure continues for 5 days after HZP's delivery of notice
to EG, HZP shall then have the option to give notice under Section 10.2(a),
and if the breach remains uncured for the 30-day period specified there, to
terminate this Agreement as specified in that Section.

     6.3.      HZP shall have the sole right and responsibility for processing
all orders for HZP's products or services on or through the HZP Site,
including receiving, filling, shipping and handling, collecting payment,
tracking and transaction security. All orders for HZP's products and services
shall be placed by customers directly with HZP and shall be subject to
acceptance by HZP.

     6.4.      Each Party warrants that the execution, delivery and
performance of this Agreement are within its corporate powers; have been duly
authorized by all necessary corporate action on such Party's part; and do not
and will not contravene or constitute a default under, and are not and will
not be inconsistent with, any law or regulation, any judgment, decree or
order, or any contract, agreement, or other undertaking applicable to such
Party.

     6.5.      HZP warrants that the materials furnished by HZP for display on
the EG Sites and the operation of, and content displayed on, the HZP Site does
not and will not infringe on the Intellectual Property Rights of any third
party or violate any law, statute, rule or regulation, and that it possesses
all Intellectual Property Rights necessary to fulfill its obligations under
this agreement.

     6.6.      EG will ensure that the performance and availability of the EG
site is monitored on a continuous basis and remains competitive in all
material respects with the performance and availability of other comparable
web sites.

SECTION 7.  INTELLECTUAL PROPERTY RIGHTS

     7.1.      Subject to the limited license granted to EG under Section 7.2,
HZP reserves all of its ownership rights, title and interest in its
Intellectual Property Rights. Subject to the limited license granted to HZP
under Section 7.3, EG reserves all of its ownership rights, title and interest
in its Intellectual Property Rights. Neither Party grants any license to any
of the Party's Intellectual Property Rights to the other Party except as
specifically set forth in this Section 7.

                                      5

<PAGE>

     7.2.      HZP hereby grants to EG, during the term of this Agreement, a
non-exclusive, non-transferable license to use HZP's Marks as reasonably
necessary to perform its obligations under this Agreement. However, any
promotional materials containing HZP's Marks will be subject to HZP's prior
written approval.

     7.3.      EG hereby grants to HZP, during the term of this Agreement, a
non-exclusive, non-transferable license to use EG's Marks as reasonably
necessary to perform its obligations under this Agreement. However, any
promotional materials containing EG's Marks will be subject to EG's specific
prior written approval.

     7.4.      Each Party agrees to cooperate with the other Party in
facilitating the monitoring and control of the use of the other Party's Marks,
and to supply the other Party with samples of use upon request. Neither EG nor
HZP will use the other Party's Marks in a manner that disparages the other
Party, its Marks or its products or services, or portrays the other Party, its
Marks or its products or services in a false, competitively adverse or poor
light. Each of EG and HZP will comply with the other Party's requests as to
the use of the other Party's Marks and will avoid any action that diminishes
the value of such Marks. Either Party's unauthorized use of the other's Marks
is strictly prohibited.

     7.5.      Upon termination of this Agreement, each Party will immediately
cease any and all use of the other Party's Intellectual Property, and within
15 days return all assets (digital, proprietary or otherwise) belonging to the
other.

SECTION 8.  CONFIDENTIALITY

     8.1.      For the purposes of this Agreement, "CONFIDENTIAL INFORMATION"
means information about the disclosing Party's business or activities that is
proprietary and confidential, including, without limitation, all trade
secrets; financial information; processes; formulas; specifications; programs;
instructions; source code; object code; technical know-how; methods and
procedures for operation; benchmark test results; information about employees;
User Data (or similar data about customers or users of a Party's products or
services other than Linked Users and Kiosk Users); marketing strategies;
services; business or technical plans and proposals (in any form); and any
other information relating to either Party that is not generally known to the
public at large. The terms and conditions of this Agreement will be deemed to
be Confidential Information of both Parties.

     8.2.      Confidential Information will not include information that: (a)
is in or enters the public domain through no action or fault of the receiving
Party; (b) the receiving Party lawfully receives from a third party without
restriction on disclosure and without breach of a nondisclosure obligation;
(c) become known to the receiving Party, from the receiving Party's own
independent sources (other than the disclosing Party or its Affiliates) as
evidenced from the receiving Party's written records, prior to receiving such
information from the disclosing Party and without breach of a nondisclosure
obligation; or (d) the receiving Party develops independent of any information
originating from the disclosing Party, so long as the receiving Party's
written records demonstrate that its employees or agents involved in such
development had no access to the Confidential Information in question.

     8.3.      (a)    Each Party agrees: (i) that it will not disclose to any
third party or use any Confidential Information disclosed to it by the other
Party except as expressly permitted in this Agreement; and (ii) that it will
take all reasonable measures to maintain the confidentiality of all
Confidential Information of the other Party in its possession or control,
which will in no event be less than the measures it uses to maintain the
confidentiality of its own information of similar importance; (b)
Notwithstanding the foregoing, each Party may disclose Confidential
Information: (i) to the extent required by a court of competent jurisdiction
or other governmental authority or otherwise as and to the extent required by
law; or (ii) on a "need-to-know" basis under an obligation of confidentiality
to its legal counsel, accountants, banks and other financing sources and their
advisors; and (c) Under paragraph (b)(i) above, it will not be deemed a breach
of this Agreement for a Party to disclose the terms and conditions of this
Agreement in any regulatory filing with the Securities & Exchange Commission,
which such Party in good faith determines is required, provided such Party
seeks confidential treatment of the material financial terms and conditions of
this Agreement. In a situation to which Section 8.3(b)(i) applies, the Party
subject to a disclosure order will make reasonable efforts promptly to inform
the other Party, so that the other Party has the opportunity to oppose the
disclosure order.

                                      6

<PAGE>

     8.4.      Neither Party will sell, disclose, transfer or rent any User
Data which could reasonably be used to identify a specific named individual
("INDIVIDUAL DATA") to any third party nor will either Party use Individual
Data on behalf of any third party without the express permission of the
individual user. Where user permission for release of Individual Data to third
parties has been obtained, each Party will obtain written assurances from the
third party recipients of Individual Data to provide the option, in any
communications generated by, or on behalf of, the third party recipients of
Individual Data, for the individual user to elect not to receive any further
communications from such third party. Each Party will comply with all
applicable privacy laws in using or releasing the Individual Data. HZP will
prominently display its privacy policy on the HZP Site, and EG will
prominently display its privacy policy on the EG Sites, at all times during
the Term of this Agreement. If it is a Party's practice to aggregate User Data
(or similar data about customers or users of a Party's products or services
other than Linked Users or Kiosk Users) for statistical analysis or other
similar purposes, such Party will include a statement to that effect in its
privacy policy.

SECTION 9.  INDEMNIFICATION

     9.1.      HZP will defend and indemnify EG and its Affiliates (and their
respective employees, directors and representatives) against any claim or
action brought by a third party (including, without limitation, any
governmental entity or authority), to the extent relating to: (a) the
operation of the HZP Site (but not including claims for which HZP has a right
to indemnity under Section 9.2(a) or (b)); (b) products or services sold by
or through the HZP Site; or (c) the direct, contributory or vicarious
infringement of third-party Intellectual Property Rights by virtue of any
materials furnished by HZP for display on the EG Sites.

     9.2.      EG will defend and indemnify HZP and its Affiliates (and their
respective employees, directors and representatives) against any claim or
action brought by a third party (including, without limitation, any
governmental entity or authority), to the extent relating to (a) the operation
of the EG Sites (but not including claims for which EG has a right to
indemnity under Sections 9.1(a) or(b)); (b) products or services sold by or
through the EG Site; or (c) or (c) the direct, contributory or vicarious
infringement of any third-party Intellectual Property Rights by virtue of any
materials furnished by EG for display on the HZP Site.

     9.3.      Subject to the indemnified party's compliance with the
procedures described in Section 9.4, the indemnifying party will pay any Award
against the indemnified party or its Affiliates (or their respective
employees, directors or representatives) and any costs and, to the extent of
any failure by the indemnifying party to defend, any attorneys' fees
reasonably incurred by the indemnified party and its Affiliates resulting from
the claim or action. For the purposes of this Section 9, "AWARD" means any
final settlement or final judgment (i.e., a settlement or judgment no longer
subject to further review, reconsideration or appeal by any court, agency, or
other tribunal of competent jurisdiction).

     9.4.      In connection with any claim or action described in this
Section, the Party seeking indemnification: (a) will give the indemnifying
Party prompt written notice of the claim; (b) will cooperate with the
indemnifying Party (at the indemnifying Party's expense) in connection with
the defense and settlement of the claim; and (c) will permit the indemnifying
Party to control the defense and settlement of the claim, provided that the
indemnifying Party may not settle the claim without the indemnified Party's
prior written consent (which will not be unreasonably withheld). Further, the
indemnified Party (at its cost) may appear separately through counsel and
participate in the defense and settlement of the claim.

SECTION 10. TERM AND TERMINATION

     10.1.     The initial term of this Agreement will begin on the Effective
Date and will end on the fifth anniversary of the Effective Date (the "INITIAL
TERM"). This Agreement may be extended for additional five year renewal terms
(the "RENEWAL TERM") upon the mutual written agreement of the parties hereto.
As the context permits, the "TERM" of this Agreement includes the Initial Term
and the Renewal Term, if any.

     10.2.     At any time during the Initial Term or the Renewal Term, either
Party may terminate this Agreement (a) if the other Party materially breaches
this Agreement and does not cure the breach within 30 days following its
receipt of written notice from the non-breaching Party; (b) effective
immediately upon delivery of written notice to the other Party if the other
Party, pursuant to federal or state law, makes an assignment for the

                                      7

<PAGE>

benefit of creditors, or commences or has commenced against it under federal
or state law any proceeding in bankruptcy, insolvency, or reorganization; or
(c) effective immediately upon delivery of written notice to other Party if
the Actual Launch Date does not occur on or prior to the Target Launch Date.

     10.3.     Unless stated otherwise herein, Sections 4.4 and 4.8 ("AUDIT
RIGHTS"), 7.1 and 7.4 ("INTELLECTUAL PROPERTY RIGHTS"), 8 ("CONFIDENTIALITY"),
9 ("INDEMNIFICATION"), 11 ("DISCLAIMERS OF IMPLIED WARRANTIES") and 12
("LIMITATION OF LIABILITY") will survive the termination or expiration of this
Agreement.

     10.4.     All undisputed payments that have accrued prior to the
termination or expiration of this Agreement will be payable in full in U.S.
currency within 30 days after termination or expiration.

SECTION 11. DISCLAIMERS OF IMPLIED WARRANTIES

EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, NEITHER PARTY MAKES, AND EACH
PARTY HEREBY DISCLAIMS, ANY REPRESENTATIONS OR WARRANTIES REGARDING ITS
WEBSITES OR THE SERVICES TO BE PROVIDED BY THAT PARTY UNDER THIS AGREEMENT,
INCLUDING (WITHOUT LIMITATION) IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE OR NONINFRINGEMENT. WITHOUT LIMITING THE GENERALITY
OF THE FOREGOING, EACH PARTY SPECIFICALLY DISCLAIMS ANY REPRESENTATION OR
WARRANTY REGARDING ANY ECONOMIC OR OTHER BENEFIT THAT THE OTHER PARTY MIGHT
OBTAIN THROUGH ITS PARTICIPATION IN THIS AGREEMENT.

SECTION 12. LIMITATION OF LIABILITY

NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR CONSEQUENTIAL DAMAGES
(INCLUDING, WITHOUT LIMITATION, LOST REVENUES, LOST PROFITS OR LOST DATA)
ARISING OUT OF THIS AGREEMENT. EACH PARTY'S ENTIRE LIABILITY ARISING FROM THIS
AGREEMENT (EXCEPT FOR LIABILITIES ARISING UNDER SECTION 9, RELATING TO A
PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OR RELATING TO A PARTY'S DAMAGE
TO PERSON OR TANGIBLE PERSONAL PROPERTY) WHETHER IN CONTRACT, TORT OR ANY
OTHER LEGAL THEORY, WILL NOT EXCEED THE AGGREGATE AMOUNTS PAYABLE BY SUCH
PARTY UNDER SECTION 4.

SECTION 13. MISCELLANEOUS

     13.1.     The Parties are entering this Agreement as independent
contractors, and this Agreement will not be construed to create a partnership,
joint venture, franchise or employment relationship between them. Neither
Party will represent itself to be an employee or agent of the other or enter
into any agreement on the other's behalf or in the other's name.

     13.2.     Neither Party will issue any press release or make any other
public disclosure regarding this Agreement or its terms without the other
Party's prior written consent as to the timing and content of that release or
disclosure (which consent shall not be unreasonably withheld), or except as
may be required by law in the opinion of the disclosing Party's counsel.

     13.3.     Neither HZP nor EG will be liable for, or will be considered to
be in breach of, or default under, this Agreement on account of any delay or
failure to perform as required by this Agreement as a result of any causes or
conditions that are beyond the Party's reasonable control and that the Party
is unable to overcome through the exercise of commercially reasonable
diligence. If any force majeure event occurs, the affected Party will give
prompt written notice to the other Party and will use commercially reasonable
efforts to minimize the impact of the event.

     13.4.     Notices deliverable under this Agreement shall be given in
writing, addressed to the Parties as set forth on the signature page below and
shall be deemed to have been given either one day after being given to an
express overnight carrier with a reliable system for tracking delivery; or
when sent by a facsimile promptly and

                                      8

<PAGE>

specifically confirmed by telephone, with another copy sent by express
overnight carrier with a reliable system for tracking delivery.

     13.5. The prevailing Party will be entitled to recover from the
non-prevailing Party all of its costs and expenses incurred in connection with
any litigation commenced to enforce any provision of this Agreement or to seek
a declaration of the rights of the Parties under this Agreement or as a result
of any breach of any provision of this Agreement, including without limitation
reasonable attorneys' fees.

     13.6.     Neither HZP nor EG may assign this Agreement, in whole or in
part, without the other Party's prior written consent. However, either party
may assign its rights and duties under this Agreement without the other
Party's consent, so long as the assignee agrees in writing to be bound by this
Agreement, to an entity purchasing all or substantially all of the assigning
Party's capital stock or assets or the surviving entity in connection with the
merger, consolidation or reorganization of the assigning Party.

     13.7.     If any provision of this Agreement is declared null, void or
otherwise unenforceable, that provision will be deemed severed from this
Agreement, and the remainder of this Agreement will be enforceable to the
maximum practicable extent.

     13.8.     This Agreement represents the entire agreement between the
Parties with respect to this subject matter and supersedes any previous or
contemporaneous oral or written agreements regarding this subject matter. This
Agreement may be amended or modified only by a written instrument signed by a
duly authorized agent of each Party.

     13.9.     This Agreement and all questions relating to its validity,
interpretation, performance and enforcement, shall be governed by and
construed in accordance with the laws of the state of Texas, without giving
effect to Texas' choice of law rules.

     13.10.    This Agreement may be executed in any number of counterparts,
each of which shall be an original and all of which shall constitute together
one and the same document.

     13.11.    The failure of either Party at any time to require performance
by the other Party of any provision of this Agreement will in no way affect
the right of that Party to require performance of that provision. Any waiver
by either Party of any breach of any provision of this Agreement will not be
construed as a waiver of any continuing or succeeding breach of that
provision, a waiver of the provision itself or a waiver of any other provision
or right under this Agreement.

     13.12.    This Agreement will be deemed to have been negotiated and
prepared at the joint request, direction, and construction of the Parties, at
arms length, with the advice and participation of counsel, and will be
interpreted in accordance with its terms without favor to either Party.

     13.13.    Nothing in this Agreement, express or implied, will give to any
person, other than the Parties and their successors under this Agreement, any
benefit or any legal or equitable right, remedy or claim under this Agreement.

                           [SIGNATURE PAGE TO FOLLOW]

                                      9

<PAGE>

     THEREFORE, the Parties have executed this Agreement as of the date first
written above by their duly authorized representatives.

                                   eGROCERY.COM INC.

                                   By:    /s/ Allen Snyder
                                      -----------------------------------------
                                      Allen Snyder
                                      Chairman
                                      360 North Robert Street, Suite 500
                                      St. Paul, MN  55101
                                      Facsimile:-------------------------------

                                   HORIZON PHARMACIES, INC.

                                   By:    /s/ Ricky D. McCord
                                      -----------------------------------------
                                      Rick McCord
                                      President and CEO
                                      531 West Main Street, Denison, Texas 75020
                                      Facsimile: (903) 465-6274

                                    S-1

<PAGE>

                                   SCHEDULE A
                                   ----------

Mason Vitamins

Hallmark

Lifescan

McKesson HBOC, Inc.

Any and all revenues derived from prescription rebates

Any and all revenues related to market share monies on prescription drug items

                           Schedule A-1

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