EXHIBIT 10.16





                               SERIES A WARRANT

                           To Purchase Common Stock

                                      of

                        FAMILY BOOKSTORES COMPANY, INC.











Warrant No. A-1


                               TABLE OF CONTENTS

                                                                           Page
                                                                           ----

1.    DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1

2.    EXERCISE OF WARRANT . . . . . . . . . . . . . . . . . . . . . . . . .   4
      2.1.    Manner of Exercise. . . . . . . . . . . . . . . . . . . . . .   4
      2.2.    Payment of Taxes. . . . . . . . . . . . . . . . . . . . . . .   5
      2.3.    Fractional Shares . . . . . . . . . . . . . . . . . . . . . .   6

3.    TRANSFER, DIVISION AND COMBINATION. . . . . . . . . . . . . . . . . .   6
      3.1.    Transfer. . . . . . . . . . . . . . . . . . . . . . . . . . .   6
      3.2.    Division and Combination. . . . . . . . . . . . . . . . . . .   6
      3.3.    Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . .   6
      3.4.    Maintenance of Books. . . . . . . . . . . . . . . . . . . . .   7

4.    ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
      4.1.    Stock Dividends, Subdivisions and Combinations. . . . . . . .   7
      4.2.    Certain Other Distributions . . . . . . . . . . . . . . . . .   7
      4.3.    Issuance of Additional Shares of Common Stock . . . . . . . .   8
      4.4.    Issuance of Warrants, Options or Other Rights . . . . . . . .  10
      4.5.    Issuance of Convertible Securities. . . . . . . . . . . . . .  10
      4.6.    Superseding Adjustment. . . . . . . . . . . . . . . . . . . .  11
      4.7.    Other Provisions Applicable to Adjustments under this
              Section . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
      4.8.    Reorganization, Reclassification, Merger, Consolidation or
              Disposition of Assets . . . . . . . . . . . . . . . . . . . .  15
      4.9.    Other Action Affecting Common Stock . . . . . . . . . . . . .  16
      4.10.   Taking of Record; Stock and Warrant Transfer
              Books . . . . . . . . . . . . . . . . . . . . . . . . . . . .  16

5.    NOTICES TO WARRANT HOLDERS. . . . . . . . . . . . . . . . . . . . . .  16
      5.1.    Notice of Adjustments . . . . . . . . . . . . . . . . . . . .  16
      5.2.    Notice of Certain Corporate Action. . . . . . . . . . . . . .  16

6.    NO IMPAIRMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . .  16

7.    RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH
      OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY . . . . . . . . . . . . . .  17

8.    PUT RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  18


                                     (i)


                                                                           Page
                                                                           ----

9.    RESTRICTIONS ON TRANSFER. . . . . . . . . . . . . . . . . . . . . . .  18
      9.1.    Restrictive Legend. . . . . . . . . . . . . . . . . . . . . .  18
      9.2.    Buy and Sell Agreement. . . . . . . . . . . . . . . . . . . .  19
      9.3.    Consent to Transfer . . . . . . . . . . . . . . . . . . . . .  19
      9.4.    Notice of Proposed Transfers; Requests for Registration . . .  19

10.   LOSS OR MUTILATION. . . . . . . . . . . . . . . . . . . . . . . . . .  19

11.   FINANCIAL AND BUSINESS INFORMATION. . . . . . . . . . . . . . . . . .  19

12.   APPRAISAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20

13.   LIMITATION OF LIABILITY . . . . . . . . . . . . . . . . . . . . . . .  20

14.   MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20
      14.1.   Nonwaiver and Expenses. . . . . . . . . . . . . . . . . . . .  20
      14.2.   Notice Generally. . . . . . . . . . . . . . . . . . . . . . .  20
      14.3.   Voting. . . . . . . . . . . . . . . . . . . . . . . . . . . .  21
      14.4.   Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . .  21
      14.5.   Successors and Assigns. . . . . . . . . . . . . . . . . . . .  22
      14.6.   Office of the Company . . . . . . . . . . . . . . . . . . . .  22
      14.7.   Information . . . . . . . . . . . . . . . . . . . . . . . . .  22
      14.8.   Amendment . . . . . . . . . . . . . . . . . . . . . . . . . .  22
      14.9.   Severability. . . . . . . . . . . . . . . . . . . . . . . . .  22
      14.10.  Headings. . . . . . . . . . . . . . . . . . . . . . . . . . .  22
      14.11.  Governing Law . . . . . . . . . . . . . . . . . . . . . . . .  22

EXHIBITS:

Exhibit A - Subscription Form
Exhibit B - Assignment Form





                                    (ii)


     NEITHER THE WARRANTS REPRESENTED HEREBY NOR THE UNDERLYING SHARES OF 
COMMON STOCK HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY 
STATE SECURITIES LAWS AND NEITHER MAY BE OFFERED FOR SALE OR SOLD IN THE 
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM 
UNDER SUCH ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF 
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT 
REQUIRED.  THIS WARRANT AND THE WARRANT STOCK ISSUED HEREUNDER ARE SUBJECT TO 
RESTRICTIONS ON TRANSFER AS PROVIDED IN SECTION 9 HEREOF

                               SERIES A WARRANT

                          To Purchase Common Stock

                                      of

                       FAMILY BOOKSTORES COMPANY, INC.

     THIS IS TO CERTIFY THAT ELECTRA INVESTMENT TRUST P.L.C., a corporation 
organized under the laws of the United Kingdom ("ELECTRA"), or permitted and 
registered assigns (collectively referred to herein as the "HOLDER"), is 
entitled, beginning on the Effective Date and at any time prior to the 
Expiration Date, to purchase from FAMILY BOOKSTORES COMPANY, INC., a Michigan 
corporation (the "COMPANY"), that number of shares of Common Stock (as 
defined herein and subject to adjustment as provided herein) equal to 15.31% 
of the number of shares of Common Stock outstanding on a Fully Diluted basis, 
excluding shares issued pursuant to the Performance Plan, on the date of 
issuance of this Warrant, at a purchase price equal to the Current Warrant 
Price, which shall be initially equal to $.01 per share and which is subject 
to adjustment as provided herein.  This Warrant is issued in connection with, 
and as consideration, in part, for, the Holder's purchase on the date hereof 
of certain of the Company's Senior Subordinated Notes due May 17, 2003, 
together with this Series A Warrant and the other warrants referred to in the 
Securities Purchase Agreement.  Capitalized terms used but not otherwise 
defined in this Warrant shall have the meanings ascribed to such terms in the 
Securities Purchase Agreement.

1.   DEFINITIONS

     As used in this Warrant, the following terms have the respective 
meanings set forth below:

     "Additional Shares of Common Stock" shall mean all shares of Common 
Stock issued by the Company after the Closing Date, other than (i) Warrant 
Stock, (ii) the shares of Common Stock issued by


the Company pursuant to the Performance Plan, (iii) shares of Common Stock 
issuable to the holders of the Series B, Series C and Series D warrants 
issued in connection with the transactions contemplated by the Securities 
Purchase Agreement and (iv) shares of Common Stock issuable to the holders of 
any Penalty Warrants issued in connection with the transactions contemplated 
by the Securities Purchase Agreement.

     "Appraised Value" shall mean, in respect of any share of Common Stock as 
of any date herein specified, the fair saleable value of such share of 
Common Stock (determined without giving effect to a discount for (i) a 
minority interest, (ii) any lack of liquidity of the Common Stock or to the 
fact that the Company may have no class of equity registered under the 
Exchange Act or (iii) any restrictions on transfer) as of the last day of the 
most recent fiscal month and prior to such date specified, based upon the 
value of the Company as determined by the Company and the Holder in 
reasonable good faith, and, if the Company and the Holder fail to so agree 
within 20 Business Days, as determined by an investment banking firm selected 
in accordance with the terms of Section 12.

     "Business Day" shall mean any day that is not a Saturday or a Sunday or 
a day on which commercial banks are required or authorized to be closed in 
the City of New York.

     "Closing Date" shall have the meaning ascribed to such term in the 
Securities Purchase Agreement.

     "Common Stock" shall mean (except where the context otherwise indicates) 
the common stock, $1.00 par value, of the Company as constituted on the 
Closing Date, and any capital stock into which such Common Stock may 
thereafter be changed, and shall also include (i) capital stock of the 
Company of any other class (regardless of how denominated) issued to the 
holders of shares of Common Stock upon any reclassification thereof which is 
also not preferred as to dividends or assets over any other class of stock of 
the Company and which is not subject to redemption and (ii) shares of common 
stock of any successor or acquiring corporation received by or distributed to 
the holders of Common Stock of the Company in the circumstances contemplated 
by Section 4.8.

     "Company" shall have the meaning set forth in the first paragraph hereof.

     "Convertible Securities" shall mean evidences of indebtedness, shares of 
stock or other securities which are convertible into or exchangeable, with or 
without payment of additional consideration in cash or property, for 
Additional Shares


                                      2



of Common Stock, either immediately or upon the occurrence of a specified 
date or a specified event.

     "Current Market Price" shall mean, in respect of any share of Common 
Stock on any date herein specified, the greater of (i) book value per share 
of Common Stock as determined by the Company's financial statements for the 
most recently ended fiscal quarter, and (ii) the Appraised Value per share of 
Common Stock.

     "Current Warrant Price" shall mean, in respect of any share of Common 
Stock on any date herein specified, the price at which a share of Common 
Stock may be purchased pursuant to this Warrant on such date.

     "Effective Date" shall mean November 17, 1994.

     "Electra" shall have the meaning set forth in the first paragraph hereof.

     "Exchange Act" shall mean the Securities Exchange Act of 1934, as 
amended from time to time.

     "Expiration Date" shall mean November 17, 2004.

     "Fully-Diluted" shall mean, when used with reference to Common Stock, at 
any date as of which the number of shares thereof is to be determined, all 
shares of Common Stock outstanding at such date and all shares of Common 
Stock issuable in respect of this Warrant increased by all common equivalent 
shares issuable at any time pursuant to any stock options, warrants, 
convertible securities, and any other security or instrument having the right 
to require additional common shares to be issued at any time in the future, 
outstanding on such date.

     "GAAP" shall mean generally accepted accounting principles as set forth 
in the opinions and pronouncements of the Accounting Principles Board of the 
American Institute of Certified Public Accountants and statements and 
pronouncements of the Financial Accounting Standards Board, or statements by 
such other entity as have been approved by a significant segment of the 
accounting profession, which are in effect from time to time.

     "Holder" shall have the meaning set forth in the first paragraph hereof.

                                       3


     "Other Property" shall have the meaning set forth in Section 4.8.

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

     "Securities Act" shall mean the Securities Act of 1933, as amended from 
time to time.

     "Securities Purchase Agreement" shall mean that certain Securities 
Purchase Agreement, dated as of November 14, 1994, by and among the Company, 
Electra and Electra Investment Trust P.L.C.

     "Transfer" shall mean any disposition of any Warrant or Warrant Stock or 
of any interest in either thereof.

     "Transfer Notice" shall have the meaning set forth in Section 9.2.

     "Triggering Event" shall have the meaning ascribed to such term in the 
Securities Purchase Agreement.

     "Warrant" or "Warrants" shall mean this Warrant and all warrants issued 
upon transfer, division or combination, or in exchange or substitution 
therefor.

     "Warrant Price" shall mean an amount equal to (i) the number of shares 
of Common Stock being purchased upon exercise of this Warrant pursuant to 
Section 2.1, multiplied by (ii) the Current Warrant Price as of the date of 
such exercise.

     "Warrant Stock" shall mean the shares of Common Stock received by the 
holders of the Warrants upon the exercise thereof.

2.   EXERCISE OF WARRANT

     2.1.  MANNER OF EXERCISE.  From and after the Effective Date, and until 
5:00 P.M. New York City time on the Expiration Date, the Holder may exercise 
this Warrant, on any Business Day, for all or any part of the number of 
shares of Common Stock purchasable hereunder; PROVIDED, HOWEVER, that if a 
Triggering Event shall have occurred prior to the Expiration Date this 
Warrant shall terminate as of the date of occurrence of such Triggering 
Event, unless exercised as provided herein.


                                      4


     In order to exercise this Warrant, in whole or in part, the Holder shall 
deliver to the Company at its principal office at 5300 Patterson, S.E., Grand 
Rapids, Michigan 49530, or at the office or agency designated by the Company 
pursuant to Section 14.7, (i) a written notice of the Holder's election to 
exercise this Warrant, which notice shall specify the number of shares of 
Common Stock to be purchased, (ii) the Holder's check in payment of the 
Warrant Price and (iii) this Warrant.  Such notice shall be substantially in 
the form of the subscription form appearing at the end of this Warrant as 
EXHIBIT A, duly executed by the Holder or its agent or attorney.  Upon 
receipt thereof, subject to Section 9, the Company shall, as promptly as 
practicable, and in any event within five (5) Business Days thereafter, 
execute or cause to be executed and delivered or cause to be delivered to the 
Holder a certificate or certificates representing the aggregate number of 
shares of Common Stock issuable upon such exercise, or, at the Company's 
option, the number of shares of Common Stock issuable on such exercise, 
together with cash in lieu of any fraction of a share, as hereinafter 
provided.  The stock certificate or certificates so delivered shall be, to 
the extent possible, in such denomination or denominations as the Holder 
shall request and shall be registered in the name of the Holder or, subject 
to Section 9, such other name as shall be designated in the notice.

     This Warrant shall be deemed to have been exercised and such certificate 
or certificates shall be deemed to have been issued, and the Holder or any 
other Person so designated to be named therein shall be deemed to have become 
a holder of record of such shares for all purposes, as of the date the 
notice, together with the cash or check and this Warrant, is received by the 
Company as described above and all taxes, if any, required to be paid prior 
to the issuance of such shares have been paid pursuant to Section 2.2.  If 
this Warrant shall have been exercised in part, the Company shall, at the 
time of delivery of the certificate or certificates, deliver to the Holder a 
new Warrant evidencing the rights of the Holder to purchase the unpurchased 
shares of Common Stock called for by this Warrant, which new Warrant shall in 
all other respects be identical with this Warrant, or, at the request of the 
Holder, appropriate notation may be made on this Warrant and the same 
returned to the Holder.

     2.2.  PAYMENT OF TAXES.  All shares of Common Stock issuable upon the 
exercise of this Warrant pursuant to the terms hereof shall be validly 
issued, fully paid and nonassessable, and the Company shall pay all expenses 
in connection with, and all taxes and other governmental charges that may be 
imposed with respect to, the issuance or delivery thereof, unless such taxes 
or charges are income taxes or otherwise imposed upon income or revenues of 
the Holder.


                                      5


     2.3.  FRACTIONAL SHARES.  The Company shall not be required to issue a 
fractional share of Common Stock upon exercise of any Warrant. As to any 
fraction of a share which the Holder of one or more Warrants, the rights 
under which are exercised in the same transaction, would otherwise be 
entitled to purchase upon such exercise, the Company may, as provided in 
Section 2.1, pay a cash adjustment in respect of such final fraction in an 
amount equal to the same fraction of the Current Market Price per share of 
Common Stock on the date of exercise.

3.   TRANSFER, DIVISION AND COMBINATION

     3.1.  TRANSFER.  Subject to Section 9, transfer of this Warrant and all 
rights hereunder, in whole or in part, shall be registered on the books of 
the Company to be maintained for such purpose, upon surrender of this Warrant 
at the principal office of the Company referred to in Section 2.1 or the 
office or agency designated by the Company pursuant to Section 14.7, together 
with a written assignment of this Warrant substantially in the form of 
EXHIBIT B hereto duly executed by the Holder or its agent or attorney.  Upon 
such surrender, the Company shall, subject to Section 9, execute and deliver 
a new Warrant or Warrants in the name of the assignee or assignees and in the 
denominations specified in such instrument of assignment, and shall issue to 
the assignor a new Warrant evidencing the portion of this Warrant not so 
assigned, and this Warrant shall promptly be cancelled.  A Warrant, if 
properly assigned in compliance with Section 9, may be exercised by a new 
Holder for the purchase of shares of Common Stock without having a new 
Warrant issued.

     3.2.  DIVISION AND COMBINATION.  Subject to Section 9, this Warrant may 
be divided or combined with other Warrants upon presentation thereof at the 
aforesaid office or agency of the Company, together with a written notice 
specifying the names and denominations in which new Warrants are to be issued 
and signed by the Holder or its agent or attorney.  Subject to Section 3.1 
and Section 9, as to any transfer which may be involved in such division or 
combination, the Company shall execute and deliver a new Warrant or Warrants 
in exchange for the Warrant or Warrants to be divided or combined in 
accordance with such notice.

     3.3.  EXPENSES.  The Company shall prepare, issue and deliver the new 
Warrant or Warrants and pay all expenses, taxes and other charges payable in 
connection with the preparation, issuance and delivery of such Warrants, 
unless such taxes or charges are income taxes or otherwise imposed upon 
income or revenues of the Holder, or arise because of the domicile of the 
Holder.


                                      6


     3.4.  MAINTENANCE OF BOOKS.  The Company agrees to maintain, at its 
aforesaid office or agency, books for the registration and the registration 
of transfer of the Warrants.

4.  ADJUSTMENTS

     The number of shares of Common Stock for which this Warrant is 
exercisable, and the price at which such shares may be purchased upon 
exercise of this Warrant, shall be subject to adjustment from time to time as 
set forth in this Section 4. The Company shall give each Holder notice of any 
event which requires an adjustment pursuant to this Section 4 at the time of 
such event.

     4.1.  STOCK DIVIDENDS, SUBDIVISIONS AND COMBINATIONS.  If at any time 
the Company shall:

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

          (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 (i) the number of shares of Common Stock for which this Warrant is 
exercisable immediately after the occurrence of any such event shall be 
adjusted to equal the number of shares of Common Stock which a record holder 
of the same number of shares of Common Stock for which this Warrant is 
exercisable immediately prior to the occurrence of such event would own or be 
entitled to receive after the occurrence of such event, and (ii) the Current 
Warrant Price shall be adjusted to equal the product of (A) the Current 
Warrant Price prior to the occurrence of such event multiplied by (B) a 
fraction, the numerator of which is the number of shares of Common Stock for 
which this Warrant is exercisable immediately prior to such adjustment and 
the denominator of which is the number of shares for which this Warrant is 
exercisable immediately after such adjustment.

     4.2.  CERTAIN OTHER DISTRIBUTIONS.  If at any time the Company shall 
take a record of the holders of its Common Stock for the purpose of entitling 
them to receive any dividend or other distribution of:

          (a)  cash (other than a regular cash dividend payable out of 
     surplus or net profits legally available for the payment of 

                                       7



     dividends under the laws of the jurisdiction of incorporation of the 
     Company),

          (b)  any evidences of its indebtedness, any shares of its stock or 
     any other securities or property of any nature whatsoever (other than 
     cash, Convertible Securities or Additional Shares of Common Stock), or

          (c)  any warrants, options or other rights to subscribe for or 
     purchase any evidences of its indebtedness, any shares of its stock or 
     any other securities or property of any nature whatsoever (other than 
     cash, Convertible Securities or Additional Shares of Common Stock),

then (i) the number of shares of Common Stock for which this Warrant is 
exercisable shall be adjusted to equal the product of (A) the number of 
shares of Common Stock for which this Warrant is exercisable immediately 
prior to such adjustment multiplied by (B) a fraction, the numerator of which 
shall be the Current Market Price per share of Common Stock at the date of 
taking such record and the denominator of which shall be such Current Market 
Price per share of Common Stock minus the amount allocable to one share of 
Common Stock of any such cash so distributable and of the fair value (as 
determined pursuant to Section 4.7(a), including as to an opinion from an 
investment banking firm) of any and all such evidences of indebtedness, 
shares of stock, other than securities or property or warrants or other 
subscription or purchase rights so distributable; and (ii) the Current 
Warrant Price shall be adjusted to equal (A) the Current Warrant Price 
multiplied by (B) a fraction, the numerator of which shall be the number of 
shares of Common Stock for which this Warrant is exercisable immediately 
prior to the adjustment and the denominator of which shall be the number of 
shares for which this Warrant is exercisable immediately after such 
adjustment. A reclassification of the Common Stock (other than a change in 
par value, or from par value to no par value or from no par value to par 
value) into shares of Common Stock and shares of any other class of stock 
shall be deemed a distribution by the Company to the holders of its Common 
Stock of such shares of such other class of stock within the meaning of this 
Section 4.2 and, if the outstanding shares of Common Stock shall be changed 
into a larger or smaller number of shares of Common Stock as a part of such 
reclassification, such change shall be deemed a subdivision or combination, 
as the case may be, of the outstanding shares of Common Stock within the 
meaning of Section 4.1.

     4.3.  ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. (a) If at any time 
the Company shall (except as hereinafter provided) issue or sell any 
Additional Shares of Common Stock, in exchange for consideration in an amount 
per Additional Share of Common Stock

                                       8



which is less than the Current Warrant Price at the time the Additional 
Shares of Common Stock are issued, then (i) the Current Warrant Price as to 
the number of shares for which this Warrant is exercisable prior to such 
adjustment shall be reduced to a price determined by dividing (A) an amount 
equal to the sum of (x) the number of shares of Common Stock outstanding 
immediately prior to such issue or sale multiplied by the then existing 
Current Warrant Price plus (y) the consideration, if any, received by the 
Company upon such issue or sale, by (B) the total number of shares of Common 
Stock outstanding immediately after such issue or sale; and (ii) the number 
of shares of Common Stock for which this Warrant is exercisable shall be 
adjusted to equal the product of (A) the Current Warrant Price in effect 
immediately prior to such issue or sale multiplied by (B) the number of 
shares of Common Stock for which this Warrant is exercisable immediately 
prior to such issue or sale, and dividing the product thereof by the Current 
Warrant Price resulting from the adjustment made pursuant to clause (i) above.

     (b)  If at any time the Company shall (except as hereinafter provided) 
issue or sell any Additional Shares of Common Stock, in exchange for 
consideration in an amount per Additional Share of Common Stock which is less 
than the Current Market Price at the time the Additional Shares of Common 
Stock are issued, then (i) the number of shares of Common Stock for which 
this Warrant is exercisable shall be adjusted to equal the product of (A) the 
number of shares of Common Stock for which this Warrant is exercisable 
immediately prior to such issue or sale multiplied by (B) a fraction, the 
numerator of which shall be the number of shares of Common Stock outstanding 
immediately after such issue or sale and the denominator of which shall be 
the sum of (x) number of shares of Common Stock outstanding immediately prior 
to such issue or sale plus (y) the number of shares which the aggregate 
offering price of the total number of such Additional Shares of Common Stock 
would purchase at the then Current Market Price; and (ii) the Current Warrant 
Price as to the number of shares for which this Warrant is exercisable prior 
to such adjustment shall be adjusted by multiplying (A) such Current Warrant 
Price by (B) a fraction, the numerator of which shall be the number of shares 
for which this Warrant is exercisable immediately prior to such issue or sale 
and the denominator of which shall be the number of shares of Common Stock 
for which this Warrant is exercisable immediately after such issue or sale.

     (c)  If at any time the Company (except as hereinafter provided) shall 
issue or sell any Additional Shares of Common Stock, in exchange for 
consideration in an amount per Additional Share of Common Stock which is less 
than the Current Warrant Price and the Current Market Price at the time the 
Additional Shares of

                                       9



Common Stock are issued, the adjustment required under this Section 4.3 shall 
be made in accordance with the formula in paragraph (a) or (b) above which 
results in the lower Current Warrant Price following such adjustment. The 
provisions of paragraphs (a) and (b) of Section 4.3 shall not apply to any 
issuance of Additional Shares of Common Stock for which an adjustment is 
provided under Section 4.1 or Section 4.2. No adjustment of the number of 
shares of Common Stock for which this Warrant shall be exercisable shall be 
made under paragraph (a) or (b) of this Section 4.3 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 warrant or other rights therefor) 
pursuant to Section 4.4 or Section 4.5.

     4.4.  ISSUANCE OF WARRANTS, OPTIONS OR OTHER RIGHTS. If at any time the 
Company shall take a record of the holders of its Common Stock for the 
purpose of entitling them to receive a distribution of, or shall in any 
manner (whether directly or by assumption in a merger in which the Company is 
the surviving corporation) issue or sell, any warrants, options or other 
rights to subscribe for or purchase any Additional Shares of Common Stock or 
any Convertible Securities, whether or not the rights to exchange or convert 
thereunder are immediately exercisable, and the price per share for which 
Common Stock is issuable upon the exercise of such warrants, options or other 
rights or upon conversion or exchange of such Convertible Securities shall be 
less than the Current Warrant Price or the Current Market Price in effect 
immediately prior to such issue or sale, then the number of shares for which 
this Warrant is exercisable and the Current Warrant Price shall be adjusted 
as provided in Section 4.3 on the basis that the maximum number of Additional 
Shares of Common Stock issuable pursuant to all such warrants, options or 
other rights or necessary to effect the conversion or exchange of all such 
Convertible Securities shall be deemed to have been issued and outstanding 
and the Company shall have received all of the consideration payable 
therefor, if any, as of the date of actual issuance of such warrants, 
options or other rights. No further adjustment of the Current Warrant Price 
shall be made upon the actual issue of such Common Stock or of such 
Convertible Securities upon exercise of such warrants, options or other 
rights or upon the actual issue of such Common Stock upon conversion or 
exchange of such Convertible Securities.

     4.5.  ISSUANCE OF CONVERTIBLE SECURITIES.  If at any time the Company 
shall take a record of the holders of its Common Stock

                                       10



for the purpose of entitling them to receive a distribution of, or shall in 
any manner (whether directly or by assumption in a merger in which the 
Company is the surviving corporation) issue or sell, any Convertible 
Securities, whether or not the rights to exchange or convert thereunder are 
immediately exercisable, and the price per share for which Common Stock is 
issuable upon such conversion or exchange shall be less than the Current 
Warrant Price or Current Market Price in effect immediately prior to the time 
of such issue or sale, then the number of Shares for which this Warrant is 
exercisable and the Current Warrant Price shall be adjusted as provided in 
Section 4.3 on the basis that the maximum number of Additional Shares of 
Common Stock necessary to effect the conversion or exchange of all such 
Convertible Securities shall be deemed to have been issued and outstanding 
and the Company shall have received all of the consideration payable 
therefor, if any, as  of the date of actual issuance of such Convertible 
Securities. No adjustment of the number of shares for which this Warrant is 
exercisable and the Current Warrant Price shall be made under this Section 
4.5 upon the issuance of any Convertible Securities which are issued pursuant 
to the exercise of any warrants, options or other subscription or purchase 
rights therefor, if any such adjustment shall previously have been made upon 
the issuance of such warrants, options or other rights pursuant to Section 
4.4. No further adjustments of the number of Shares for which this Warrant is 
exercisable and the Current Warrant Price shall be made upon the actual issue 
of such Common Stock upon conversion or exchange of such Convertible 
Securities and, if any issue or sale of such Convertible Securities is made 
upon exercise of any warrant, option or other right to subscribe for or to 
purchase any such Convertible Securities for which adjustments of the number 
of Shares for which this Warrant is exercisable and the Current Warrant Price 
have been or are to be made pursuant to other provisions of Section 4, no 
further adjustments of the number of Shares for which this Warrant is 
exercisable and the Current Warrant Price shall be made by reason of such 
issue or sale.

     4.6.  SUPERSEDING ADJUSTMENT.  If, at any time after any adjustment of 
the number of shares of Common Stock for which this Warrant is exercisable 
and of the Current Warrant Price shall have been made pursuant to Section 4.4 
or Section 4.5 as the result of any issuance of warrants, options, rights or 
Convertible Securities, such warrants, options or rights, or the right of 
conversion or exchange of such Convertible Securities, shall expire, and all 
or a portion of such warrants, options or rights, or the right of conversion 
or exchange with respect to all or a portion of such other Convertible 
Securities, as the case may be, shall not have been exercised, then such 
previous adjustment shall be rescinded and annulled and the Additional Shares 
of Common Stock which were deemed to have been issued by virtue of the 
computation

                                       11



made in connection with the adjustment so rescinded and annulled shall no 
longer be deemed to have been issued by virtue of such computation. 
Thereupon, a recomputation shall be made of the effect of such warrants, 
options or rights or Convertible Securities on the basis of (a) treating the 
number of Additional Shares of Common Stock or other property, if any, 
theretofore actually issued or issuable pursuant to the previous exercise of 
any such warrants, options or rights or any such right of conversion or 
exchange, as having been issued on the date or dates of any such exercise and 
for the consideration actually received and receivable therefor, and (b) 
treating any such warrants, options or rights or any such Convertible 
Securities which then remain outstanding as having been granted or issued 
immediately after the time of such increase of the consideration per share 
for which shares of Common Stock or other property are issuable under such 
warrants, options or rights or other Convertible Securities, whereupon a new 
adjustment of the number of shares of Common Stock for which this Warrant is 
exercisable and the Current Warrant Price shall be made, which new adjustment 
shall supersede the previous adjustment so rescinded and annulled.

     4.7.  OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS SECTION.  
The following provisions shall be applicable to the making of adjustments of 
the number of shares of Common Stock for which this Warrant is exercisable 
and the Current Warrant Price provided for in this Section 4:

     (a)  COMPUTATION OF CONSIDERATION. To the extent that any Additional 
Shares of Common Stock or any Convertible Securities or any warrants, options 
or other rights to subscribe for or purchase any Additional Shares of Common 
Stock or any Convertible Securities shall be issued for cash consideration, 
the consideration received by the Company therefor shall be the amount of the 
cash received by the Company, or, if such Additional Shares of Common Stock 
or Convertible Securities are offered by the Company for subscription, the 
subscription price, or, if such Additional Shares of Common Stock or 
Convertible Securities are sold to underwriters or dealers for public 
offering without a subscription offering, the public offering price (in any 
such case subtracting any amounts paid or receivable for accrued interest or 
accrued dividends and without taking into account any compensation, discounts 
or expenses paid or incurred by the Company for and in the underwriting of, 
or otherwise in connection with, the issuance 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 fair value of such consideration at the time of such issuance 
as determined in good faith by the Board of Directors of the Company.  In 
case any Additional Shares of Common Stock or


                                     12


any Convertible Securities or any warrants, options or other rights to 
subscribe for or purchase such Additional Shares of Common Stock or 
Convertible Securities shall be issued in connection with any merger in which 
the Company issues any securities, the amount of consideration therefor 
shall be deemed to be the fair value, as determined in good faith by the 
Board of Directors of the Company, of such portion of the assets and business 
of the nonsurviving corporation as such Board in good faith shall determine 
to be attributable to such Additional Shares of Common Stock, Convertible 
Securities, warrants, options or other rights, as the case may be.  The 
consideration for any Additional Shares of Common Stock issuable pursuant to 
any warrants, options or other rights to subscribe for or purchase the same 
shall be the consideration received by the Company for issuing such warrants, 
options or other rights plus the additional consideration payable to the 
Company upon exercise of such warrants, options 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 the Company for issuing warrants, options or other rights to subscribe for 
or purchase such Convertible Securities, plus the consideration paid or 
payable to the Company in respect of the subscription for or purchase of such 
Convertible Securities, plus the additional consideration, if any, payable to 
the 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 dividends upon any class of stock other than Common 
Stock, the 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)  WHEN ADJUSTMENTS TO BE MADE.  The adjustments required by this 
Section 4 shall be made whenever and as often as any specified event 
requiring an adjustment shall occur, except that any adjustment of the number 
of shares of Common Stock for which this Warrant is exercisable that would 
otherwise be required may be postponed (except in the case of a subdivision 
or combination of shares of the Common Stock, as provided for in Section 4.1) 
up to, but not beyond the date of exercise if such adjustment either by 
itself or with other adjustments not previously made, will, based on a good 
faith determination of the Board of Directors of the Company, add or subtract 
less than an amount equal to 1% of the Common Stock outstanding immediately 
prior to the making of such adjustment.  Any adjustment representing a change 
of less than such minimum amount (except as aforesaid) which is postponed 
shall be carried forward and made as soon as such adjustment, together with 
other adjustments required by this Section 4 and not previously made, would 
result in a


                                      13


minimum adjustment or on the date of exercise. For the purpose of any 
adjustment, any specified event shall be deemed to have occurred at the close 
of business on the date of its occurrence.

     (c)  FRACTIONAL INTERESTS.  In computing adjustments under this Section 
4, fractional interests in Common Stock shall be taken into account to the 
nearest 1/10th of a share.

     (d)  WHEN ADJUSTMENT NOT REQUIRED.  If the Company shall take a record 
of the holders of its Common Stock for the purpose of entitling them to 
receive a dividend or distribution or subscription or purchase rights and 
shall, thereafter and before the distribution to stockholders thereof, 
legally abandon its plan to pay or deliver such dividend, distribution, 
subscription or purchase rights, then thereafter no adjustment shall be 
required by reason of the taking of such record and any such adjustment 
previously made in respect thereof shall be rescinded and annulled.

     (e)  ESCROW OF WARRANT STOCK.  If after any property becomes 
distributable pursuant to this Section 4 by reason of the taking of any 
record of the holders of Common Stock, but prior to the occurrence of the 
event for which such record is taken, and the Holder exercises this Warrant, 
any Additional Shares of Common Stock issuable upon exercise by reason of 
such adjustment shall be deemed the last shares of Common Stock for which 
this Warrant is exercised (notwithstanding any other provision to the 
contrary herein) and such shares or other property shall be held in escrow 
for the Holder by the Company to be issued to the Holder upon and to the 
extent that the event actually takes place, upon payment of the then Current 
Warrant Price. Notwithstanding any other provision to the contrary herein, if 
the event for which such record was taken fails to occur or is rescinded, 
then such escrowed shares shall be cancelled by the Company and escrowed 
property returned.

     (f)  CHALLENGE TO GOOD FAITH DETERMINATION.  Whenever the Board of 
Directors of the Company shall be required to make a determination in good 
faith of the fair value of any item under this Section 4, such determination 
may be challenged in good faith by the Holder, and if, upon the expiration of 
20 Business Days, the Holder and the Company fail to agree as to such fair 
value, after reasonable, good faith negotiation, any dispute shall be 
resolved by an investment banking firm selected by the Company and reasonably 
acceptable to such Holder (or, if more than one Warrant is outstanding, to 
holders of a majority of Warrant Stock issuable upon exercise of the 
Warrants). The Company shall bear 80%, and the Holder shall bear 20%, of the 
cost of such firm.

                                       14



     4.8.  REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR 
DISPOSITION OF ASSETS.  In case the Company shall reorganize its capital, 
reclassify its capital stock, consolidate or merge with or into another 
corporation (where there is a change in or distribution with respect to the 
Common Stock of the Company other than a subdivision, combination or exchange 
otherwise provided for herein), or sell, transfer or otherwise dispose of all 
or substantially all its property, assets or business to another corporation 
and, pursuant to the terms of such reorganization, reclassification, merger, 
consolidation or disposition of assets, shares of common stock of the 
successor or acquiring corporation, or any cash, shares of stock or other 
securities or property of any nature whatsoever (including warrants or other 
subscription or purchase rights) in addition to or in lieu of common stock of 
the successor or acquiring corporation (herein referred to as "OTHER 
PROPERTY"), are to be received by or distributed to the holders of Common 
Stock of the Company, then each Holder shall have the right thereafter to 
receive, upon exercise of such Warrant, the number of shares of common stock 
of the successor or acquiring corporation or of the Company, if it is the 
surviving corporation, and Other Property receivable upon or as a result of 
such reorganization, reclassification, merger, consolidation or disposition 
of assets by a holder of the number of shares of Common Stock for which this 
Warrant is exercisable immediately prior to such event. In case of any such 
reorganization, reclassification, merger, consolidation or disposition of 
assets, the successor or acquiring corporation (if other than the Company) 
shall expressly assume the due and punctual observance and performance of 
each and every term and condition of this Warrant to be performed and 
observed by the Company and all the obligations and liabilities hereof, 
subject to such modifications as may be deemed appropriate (as determined in 
good faith by resolution of the Board of Directors of the Company) in order 
to provide for adjustments of shares of the Common Stock for which this 
Warrant is exercisable which shall be as nearly equivalent as practicable to 
the adjustments provided for in this Section 4. For purposes of this 
Section 4.8 "common stock of the successor or acquiring corporation" shall 
include stock of such corporation of any class which is not preferred as to 
dividends or assets over any other class of stock of such corporation and 
which is not subject to redemption and shall also include any evidences of 
indebtedness, shares of stock or other securities which are convertible into 
or exchangeable for any such stock, either immediately or upon the arrival of 
a specified date or the happening of a specified event, and any warrants, 
options or other rights to subscribe for or purchase any such stock. The 
foregoing provisions of this Section 4.8 shall similarly apply to successive 
reorganizations, reclassifications, mergers, consolidations or disposition of 
assets.

                                       15



     4.9 OTHER ACTION AFFECTING COMMON STOCK.  In case at any time or from 
time to time the Company shall take any action in respect of its Common 
Stock, other than action described in this Section 4, then, unless such 
action will not have a material adverse effect upon the rights of the Holder, 
the number of shares of Common Stock or other stock for which this warrant is 
exercisable and/or the purchase price thereof shall be adjusted in such 
manner as may be equitable in the circumstances.

     4.10  TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS.  In the case 
of all dividends or other distributions by the Company to the holders of its 
Common Stock with respect to which any provision of Section 4 refers to the 
taking of a record of such holders, the Company will in each such case take 
such a record and will take such record as of the close of business on a 
Business Day. The Company will not at any time close its stock transfer books 
or warrant transfer books so as to result in preventing or delaying the 
exercise or transfer of any Warrant.

5.  NOTICES TO WARRANT HOLDERS

     5.1  NOTICE OF ADJUSTMENTS.  Whenever the number of shares of Common 
Stock for which this Warrant is exercisable, or whenever the price at which a 
share of such Common Stock may be purchased upon exercise of this Warrant, 
shall be adjusted pursuant to Section 4, the Company shall forthwith prepare 
a certificate to be executed by the chief financial officer of the Company 
setting forth, in reasonable detail, the event requiring the adjustment, the 
amount of the adjustment, the method by which such adjustment was calculated 
and specifying the Current Warrant Price and the number of shares of Common 
Stock for which this Warrant is exercisable after giving effect to such 
adjustment or change. The Company shall promptly cause a signed copy of such 
certificate to be delivered to the Holder in accordance with Section 14.2. The 
Company shall keep at its office or agency designated pursuant to Section 
14.7 copies of all such certificates and cause the same to be available for 
inspection at said office during normal business hours by the Holder or any 
prospective purchaser of a Warrant designated by the Holder thereof.

     5.2  NOTICE OF CERTAIN CORPORATE ACTION.  The Holder shall be entitled 
to the same rights to receive notice of corporate action as any holder of 
Common Stock.

6.  NO IMPAIRMENT

     The Company shall not by any action, including, without limitation, 
amending its articles of incorporation or through any reorganization, 
transfer of assets, consolidation, merger,

                                       16



dissolution, issue or sale of securities or any other voluntary action, avoid 
or seek to avoid the observance or performance of any of the terms of this 
Warrant, but will at all times in good faith assist in the carrying out of 
all such terms and in the taking of all such actions as may be necessary or 
appropriate to protect the rights of the Holder against impairment. Without 
limiting the generality of the foregoing, the Company will take all such 
action as may be necessary or appropriate in order that the Company may 
validly and legally issue fully paid and nonassessable shares of Common Stock 
upon the exercise of this Warrant.

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

7.  RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION
    WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY

     The Company shall at all times reserve and keep available for issuance 
upon the exercise of this Warrant such number of its authorized but unissued 
shares of Common Stock as will be sufficient to permit the exercise in full 
of all outstanding warrants. The Company covenants that all shares of Common 
Stock which shall be so issuable, when issued upon exercise of any Warrant 
and payment therefor in accordance with the terms of such Warrant, shall be 
duly and validly issued and fully paid and nonassessable.

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

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

     If any shares of Common Stock required to be reserved for issuance upon 
exercise of Warrants require registration or qualification with any 
governmental authority under any federal or state law (otherwise than as 
provided in Section 9) before such 

                                       17



shares may be so issued, the Company will in good faith, as expeditiously as 
possible and at its own expense, endeavor to cause such shares to be duly 
registered or qualified, as the case may be.

8.  PUT RIGHTS

     The Holder shall have the right to require the Company to repurchase all 
or any portion of the Warrants held by the Holder upon the terms and as 
provided in paragraph 13B of the Securities Purchase Agreement.

9.  RESTRICTIONS ON TRANSFER

     The Warrants and the Warrant Stock may not be transferred or assigned 
before satisfaction of the conditions specified in this Section 9, which are 
intended, among other purposes, to ensure compliance with the provisions of 
the Securities Act with respect to the Transfer of any Warrant or any Warrant 
Stock. The Holder, by acceptance of this Warrant, agrees to be bound by the 
provisions of this Section 9.

     9.1  RESTRICTIVE LEGEND.  This Warrant, and all shares of Warrant Stock 
issued upon exercise hereof, shall be stamped or otherwise imprinted with a 
legend in substantially the following form:

     "THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE 
     SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE 
     OFFERED FOR SALE OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION 
     STATEMENT OR AN EXEMPTION THEREFROM UNDER SUCH ACT AND ANY APPLICABLE 
     STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY 
     TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. THIS WARRANT AND 
     THE WARRANT STOCK ISSUED HEREUNDER ARE SUBJECT TO RESTRICTIONS ON 
     TRANSFER AS PROVIDED IN SECTION 9 HEREOF."

In addition, all shares of Warrant Stock issued upon the initial exercise of 
this Warrant shall bear a legend in substantially the following form:

     IN ADDITION TO THE FOREGOING RESTRICTIONS ON TRANSFER, THE SECURITIES 
     REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, 
     PLEDGED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS OF 
     A CERTAIN BUY AND SELL AGREEMENT DATED AS OF NOVEMBER 14, 1994, A COPY 
     OF WHICH IS ON FILE WITH THE COMPANY. ANY ATTEMPTED SALE, TRANSFER, 
     ASSIGNMENT, PLEDGE OR OTHER DISPOSITION IN VIOLATION OF THE TERMS OF 
     THE BUY AND SELL AGREEMENT IS VOID.

                                       18



     9.2  BUY AND SELL AGREEMENT.  The Warrant Stock is subject to the terms 
of a Buy and Sell Agreement dated as of November 14, 1994, a copy of which is 
on file with the Company. No shares of Warrant Stock may be sold, 
transferred, assigned, pledged or otherwise disposed of except in accordance 
therewith.

     9.3  CONSENT TO TRANSFER.  The Holder of this Warrant shall not 
transfer, assign, or otherwise dispose, or permit the transfer, assignment or 
other disposition by it, of this Warrant or any Warrant Stock, or any 
interest therein, to any person (including any Electra Transferee, Permitted 
Person, or any other transferee), other than the Company or any Shareholder, 
unless the transferee agrees in a writing satisfactory to the Company: 
(i) that it will not transfer or permit the transfer of this Warrant or any 
shares of Common Stock so acquired or any interest therein to any Person 
(other than the Company or any Shareholder) without the prior written consent 
of the Company and (ii) that it will be bound by the transfer restrictions 
set forth in this Section 9.3. The consent required in clause (i) of the 
immediately preceding sentence may be withheld by the Company only if, in the 
Company's reasonable opinion, the transferee (x) competes directly or 
indirectly with the Company or (y) may be expected to have a significant 
adverse effect on the Company's Christian-based mission or image. Any 
transfer in violation of this Section 9.3 shall be void. Any stock 
certificate for shares subject to the transfer restrictions set forth in this 
Section 9.3 shall include a legend reflecting the restrictions on transfer 
set forth in this Section 9.3. For purposes of this Section 9.3, the terms 
"Electra Transferee", "Permitted Person" and "Shareholder" shall have the 
respective meanings assigned to such terms in the Buy and Sell Agreement. The 
Company may deny consent to a transfer of this warrant if the proposed 
transfer would cause the total number of Holders of this and all other 
Warrants, including the Series B, Series C, Series D, and the Penalty 
Warrants, to exceed 10, except for any proposed intra-company transfers by 
and among Electra or any of its Affiliates.

     9.4.  NOTICE OF PROPOSED TRANSFERS; REQUESTS FOR REGISTRATION.  Prior to 
any Transfer of any Warrant, the holder of such Warrant shall give five days' 
prior written notice (a "TRANSFER NOTICE") to the Company of such holder's 
intention to effect such Transfer, including a description of the manner and 
circumstances of the proposed Transfer and, if requested by the Company, an 
opinion from counsel to such holder that the proposed Transfer of such 
Warrant may be effected without registration under the Securities Act. After 
delivery of the Transfer Notice, the holder shall be entitled to Transfer 
such Warrant in accordance with the terms of the Transfer Notice. Each 
Warrant issued upon such Transfer shall bear the restrictive legend set forth 
in 

                                       19



Section 9.1, unless such legend is not required in order to ensure compliance 
with the Securities Act.

10.  LOSS OR MUTILATION

     Upon receipt by the Company from any Holder of evidence reasonably 
satisfactory to it of the ownership of and the loss, theft, destruction or 
mutilation of this Warrant and, in case of loss, theft or destruction, of 
indemnity reasonably satisfactory to it (it being understood and agreed that 
the written agreement of Electra and subsequent institutional transferees, if 
any, shall be sufficient indemnity) and, in case of mutilation, upon 
surrender and cancellation hereof, the Company will execute and deliver in 
lieu hereof a new Warrant of like tenor in replacement.

11.  FINANCIAL AND BUSINESS INFORMATION

     The Company will deliver or cause to be delivered to each Holder, as 
provided in paragraph 6A of the Securities Purchase Agreement, certain 
financial information, financial analyses, notices, reports, statements and 
certificates, all to the extent and in the manner provided therein.

12.  APPRAISAL

     If the Company and the Holder fail to agree as to the Appraised Value 
per share of Common Stock, after reasonable, good faith negotiation, upon the 
expiration of 20 Business Days, the determination of the Appraised Value per 
share of Common Stock shall be made by an investment banking firm 
satisfactory to both the Company and the Holder (or, if there is more than 
one Warrant outstanding, to holders of a majority of the Warrant Stock 
issuable upon exercise of the Warrants). The Company shall retain such 
investment banking firm as may be necessary for the determination of 
Appraised Value required by the terms of this Warrant, and the Company shall 
bear 80%, and the Holder shall bear 20%, of the cost of such firm.

13.  LIMITATION OF LIABILITY

     No provision hereof, in the absence of affirmative action by the Holder 
to purchase shares of Common Stock, and no enumeration herein of the rights 
or privileges of the Holder, shall give rise to any liability of such Holder 
for the purchase price of any Common Stock or as a stockholder of the 
Company, whether such liability is asserted by the Company or by creditors of 
the Company.

                                       20



14.  MISCELLANEOUS

     14.1.  NONWAIVER AND EXPENSES.  No course of dealing or any delay or 
failure to exercise any right hereunder on the part of the Holder shall 
operate as a waiver of such right or otherwise prejudice the Holder's rights, 
powers or remedies. If the Company fails to make, when due, any payments 
provided for hereunder, or fails to comply with any provision of this 
Warrant, the Company shall pay to the Holder such amounts as shall be 
sufficient to cover any costs and expenses including, but not limited to, 
reasonable attorneys' fees, incurred by the Holder in collecting any amounts 
due pursuant hereto or in otherwise enforcing any of its rights, powers and 
remedies hereunder.

     14.2.  NOTICE GENERALLY. Any notice, demand, request, consent, approval, 
declaration, delivery or other communication hereunder to be made pursuant to 
the provisions of this Warrant shall be sufficiently given or made if in 
writing and either delivered in person with receipt acknowledged or sent by 
registered or certified mail, return receipt requested, postage prepaid, 
addressed as follows:

     (a)  If to any Holder or holder of Warrant Stock, at its last known 
address appearing on the books of the Company maintained for such purpose;

     (b)  If to the Company at:

          Family Bookstores Company, Inc.
          5300 Patterson, S.E.
          Grand Rapids, Michigan 49530
          Attention:  Leslie E. Dietzman

     with a copy to:

         Warner Norcross & Judd
         900 Old Kent Building
         111 Lyon Street, N.W.
         Grand Rapids, Michigan 49503-2489
         Attention:  John G. Cameron, Jr., Esq.

or at such other address as may be substituted by notice given as herein 
provided. The giving of any notice required hereunder may be waived in 
writing by the party entitled to receive such notice. Every notice, demand, 
request, consent, approval, declaration, delivery or other communication 
hereunder shall be deemed to have been duly given or served on the date on 
which personally delivered, with receipt acknowledged, or three (3) Business 
Days

                                       21



after the same shall have been postmarked in the United States mail.

     14.3.  VOTING.  If requested by the Holder hereof, and to the extent 
permitted by law, the Company shall take all action to entitle the Holder to 
vote with the Common Stock of the Company that number of votes equal to the 
number of shares of Common Stock issuable from time to time upon exercise of 
this Warrant on any matters upon which the holders of Common Stock are 
entitled to vote; PROVIDED, that the rights of the Holder hereunder shall not 
duplicate any rights of the Holder to vote with the Common Stock as may be 
provided under the Shareholders' Agreement.

     14.4.  REMEDIES.  Each holder of this Warrant and any Warrant Stock 
issuable upon exercise of this Warrant, in addition to being entitled to 
exercise all rights granted by law, including recovery of damages, will be 
entitled to specific performance of its rights under this Warrant. The 
Company agrees that monetary damages would not be adequate compensation for 
any loss incurred by reason of a breach by it of the provisions of Section 9 
of this Warrant and hereby agrees to waive the defense in any action for 
specific performance that a remedy at law would be adequate.

     14.5.  SUCCESSORS AND ASSIGNS.  Subject to the provisions of Sections 
3.1 and 9, this Warrant and the rights evidenced hereby shall inure to the 
benefit of and be binding upon the successors of the Company and the 
successors and assigns of Electra or any other holder hereof. The provisions 
of this Warrant are intended to be for the benefit of all holders from time 
to time of this Warrant, and shall be enforceable by any such holder.

     14.6.  OFFICE OF THE COMPANY.  As long as any of the Warrants remain 
outstanding, the Company shall maintain an office or agency (which may be 
the principal executive offices of the Company) where the Warrants may be 
presented for exercise, registration of transfer, division or combination as 
provided in this Warrant.

     14.7  INFORMATION.  The Company shall cooperate with each Holder of a 
Warrant and each holder of Warrant Stock in supplying such information as may 
be reasonably requested by such holder to comply with any filings or 
information reporting forms presently or hereafter required as a condition to 
the availability of an exemption from the Securities Act for the sale of any 
Warrant or Warrant Stock.

     14.8.  AMENDMENT.  This Warrant may be modified or amended or the 
provisions hereof waived with the written consent of the Company and the 
Holder (or, if there is more than one Warrant

                                       22



outstanding, to holders of a majority of the Warrant Stock issuable upon 
exercise of the Warrants).

     14.9.  SEVERABILITY.  Wherever possible, each provision of this Warrant 
shall be interpreted in such manner as to be effective and valid under 
applicable law, but if any provision of this Warrant shall be prohibited by 
or invalid under applicable law, such provision shall be ineffective to the 
extent of such prohibition or invalidity, without invalidating the remainder 
of such provision or the remaining provisions of this Warrant.

     14.10.  HEADINGS.  The headings used in this Warrant are for the 
convenience of reference only and shall not, for any purpose, be deemed a 
part of this Warrant.

     14.11.  GOVERNING LAW.  This Warrant shall be governed by the laws of 
the State of New York, without regard to the provisions thereof relating to 
conflict of laws, except to the extent matters herein are governed by the 
Michigan Business Corporation Act, under which the Company is incorporated.

                                       23



     IN WITNESS WHEREOF, the Company has caused this Warrant to be duly 
executed and delivered by an officer thereunto duly authorized, as of the 
17th day of November, 1994.


                                     FAMILY BOOKSTORES COMPANY, INC.


                                     By: /s/ Leslie E. Dietzman
                                         ---------------------------
                                         Name:  Leslie E. Dietzman
                                         Title: President




                                   EXHIBIT A
                               SUBSCRIPTION FORM
                [To be executed only upon exercise of Warrant]
                                       

     The undersigned registered owner of this Warrant irrevocably exercises 
this Warrant for the purchase of __________ shares of Common Stock of FAMILY 
BOOKSTORES COMPANY, INC., and herewith makes payment therefor, all at the 
price and on the terms and conditions specified in this Warrant and requests 
that certificates for the shares of Common Stock hereby purchased (and any 
securities or other property issuable upon such exercise) be issued in the 
name of and delivered to ____________________________________ whose address 
is _________________________________________ and, if such shares of Common 
Stock shall not include all of the shares of Common Stock issuable as 
provided in this Warrant, that a new Warrant of like tenor and date for the 
balance of the shares of Common Stock issuable hereunder be delivered to the 
undersigned.

Dated: ___________________


                                    __________________________________
                                     (Name of Registered Owner)


                                    __________________________________
                                     (Signature of Registered Owner)


                                    __________________________________
                                     (Street Address)


                                    __________________________________
                                     (City)    (State)    (Zip Code)


     NOTE: The signature on this subscription must correspond with the name 
as written upon the face of the within Warrant in every particular, without 
alteration or any change whatsoever.



                                   EXHIBIT B
                                ASSIGNMENT FORM
                                       

     FOR VALUE RECEIVED, the undersigned registered owner of this Warrant 
hereby sells, assigns and transfers unto the Assignee named below all of the 
rights of the undersigned under this Warrant, with respect to the number of 
shares of Common Stock set forth below:

                                                   Number of Shares
Name and Address of Assignee                       of Common Stock
- ----------------------------                       ----------------


and does hereby irrevocably constitute and appoint ___________________________
attorney-in-fact to register such transfer on the books of FAMILY BOOKSTORES 
COMPANY, INC. maintained for the purpose, with full power of substitution in 
the premises.

Dated: ______________________

                                        __________________________________
                                        (Registered Owner)

     NOTE: The signature on this assignment must correspond with the name as 
written upon the face of the within Warrant in every particular, without 
alteration or any change whatsoever. Transfer is subject to restrictions as 
provided in the Warrant.