AMENDMENT #3
                                     to the
                  Purchase of Equipment and Services Agreement
                                     Between
                        Sprint/United Management Company
                                       And
                          Hybrid Networks, Incorporated

     This is the Third  Amendment  ("Amendment  3") to the Purchase of Equipment
and Services Agreement  ("Agreement")  dated May 1, 2000, between  Sprint/United
Management  Company  ("Sprint"),  a Kansas  corporation,  with  offices  at 2330
Shawnee Mission  Parkway,  Westwood,  Kansas 66205,  and Hybrid  Networks,  Inc.
("Hybrid"), a Delaware corporation, with its principal offices at 6409 Guadalupe
Mines Road, San Jose, CA 95120.

     This  Amendment 3 shall be effective (the  "Effective  Date") as of July 3,
2001.

     In order to facilitate the parties' working relationship, Sprint and Hybrid
have agreed to certain  modifications of the Agreement and the December 22, 2000
Amendment to the Agreement  ("Amendment  1") and the March 31, 2001 Amendment to
the Agreement ("Amendment 2"), as follows:

1. Terms of Purchase and Sale.

     (a)  Sprint  has  submitted  a  binding   purchase  order  (Purchase  Order
#21-0002442223,  dated July 24, 2001) to Hybrid in the amount of $1,590,400  for
the  purchase  of Base  Station  (head end)  Equipment.  The  parties  expressly
acknowledge  and agree that,  notwithstanding  anything in the  Agreement to the
contrary, (i) such Base Station Equipment will not be subject to the Substantial
Completion  and  Final  Acceptance  testing  referenced  in  Section  11 of  the
Agreement, nor to any testing under Section 7 or Schedule 1.21 of the Agreement,
and (ii)  Hybrid  will have the right  (notwithstanding  Section  23.2(b) of the
Agreement)  to  invoice  Sprint  for the full  purchase  price for all such Base
Station  Equipment  upon the date the Base  Station  Equipment  is  shipped.  In
accordance with Section 23.2(a) of the Agreement, Hybrid's invoice for such Base
Station  Equipment  will be due and  payable  in full by Sprint 30 days from the
date of shipment.  The foregoing will not be deemed to waive any warranties made
by Hybrid in the Agreement or any other rights Sprint has under the Agreement.

     (b)  Notwithstanding  anything  to  the  contrary  in  Section  2.6  of the
Agreement,  on the first business day of each calendar month beginning with July
6, 2001,  Sprint will deliver 12-month rolling forecasts to Hybrid for purchases
of Modems (as defined  herein.) The quantity  indicated for the first 90 days of
each such  forecast  will be a binding  commitment  to purchase  by Sprint.  For
purposes  hereof,  "Modems"  means  P-modems  (WBR-60-231  or 231B) and ThruWAVE
modems.

     (c) Sprint  will  submit an initial  12-month  rolling  forecast  of 96,000
Modems  for the period  from July 1, 2001  through  June 30,  2002 that will (i)
include 24,000 P-modems to be

<PAGE>

purchased  at a price of $335 per  P-modem  during the first 90 days  covered by
such forecast and (ii) have the following shipment dates:

--------------------------------------------------------------------------------
Shipment Date                                        Quantity of P-modems
--------------------------------------------------------------------------------
by 7/15/01                                           8,000
--------------------------------------------------------------------------------
8/01/01                                              8,000
--------------------------------------------------------------------------------
9/04/01                                              8,000
--------------------------------------------------------------------------------

     (d) After Sprint purchases from Hybrid, at a price of $335 per P-modem, the
lesser of (i) 37,000 P-modems or (ii) Hybrid's remaining  available inventory of
P-modems,  then Sprint may meet its future  purchase  commitments  for Modems by
acquiring ThruWAVE modems at $335 per modem. Hybrid may, but is not required to,
make more than 24,000  P-modems  available  to Sprint.  Sprint will  continue to
receive  shipping  priority and Most Favored  Customer  Status,  as set forth in
Sections 3.5 and 21.2 of the  Agreement,  respectively,  in connection  with any
Modem purchases.

     (e)  Notwithstanding  anything to the  contrary  in Section  23.2(d) of the
Agreement,  Sprint agrees to wire transfer the aggregate purchase price for each
shipment of Modems within 3 business  days after  receipt of the  shipment,  but
only if Hybrid  provides an accurate and complete pro forma invoice to Sprint at
least 5 business days before shipment.

     (f)  Hybrid  shall use  commercially  reasonable  efforts  to  achieve  the
shipment  dates set forth in subsection (c) above.  However,  Hybrid will not be
deemed to be in breach of the Agreement if Hybrid  supplies the Modems  pursuant
to the lead times  governed  by Section  2.7 of the  Agreement.  If there is any
breach of the  Agreement by Hybrid,  in any material or  non-material  way, then
Sprint may,  in its sole  discretion  and in  addition to any other  remedies in
equity or at law, accelerate its purchase of P-modems,  which were included in a
purchase order submitted by Sprint to Hybrid, at any time, by giving 1-day prior
written notice to Hybrid.  Any cure period  otherwise  applicable to such breach
does not apply.

     (g) The material breach provision in Section 17.2 of the Agreement  changes
from "135 days" to "30 days" with respect to CPE (customer  premises  equipment)
until such time as Hybrid publicly reports a net worth of $10,000,000,  at which
time the number of days will revert back to "135 days".

2. Warrant. Concurrently with the execution of this Amendment 3 by both parties,
Hybrid will execute the warrant, attached hereto as Exhibit A, pursuant to which
Hybrid will grant  Sprint the right to acquire 25 shares of Hybrid  common stock
for each P-modem  purchased by Sprint pursuant to the terms of this Amendment 3,
up to the first 24,000 P-modems purchased by Sprint after July 1, 2001.

3.  Defined  Terms.   Unless  otherwise  specified  in  this  Amendment  3,  all
capitalized  terms  used  herein  shall  have  the  meanings  set  forth  in the
Agreement.

4. Termination of Letter  Agreement.  The Letter  Agreement  between the parties
dated July 3, 2001 is hereby terminated and is null and void.


                                       2
<PAGE>

5.  Controlling  Terms.  In the event of a  conflict  between  the terms of this
Amendment 3 and the terms of  Amendment  1,  Amendment 2 or the  Agreement,  the
terms of this Amendment 3 shall control.

6.  Effect of  Amendment.  All  other  terms and  conditions  of the  Agreement,
including  Amendment 1 and Amendment 2 remain unchanged.  Except as specifically
stated  herein,  nothing in this  Amendment 3 waives either party's rights under
the Agreement or Amendment 1 or Amendment 2.

IN  WITNESS  WHEREOF,  each  party  has  executed  this  Amendment  3 by a  duly
authorized  representative.   The  parties  acknowledge  that  they  have  read,
understood and agreed to the terms of this Amendment 3.

SPRINT/UNITED MANAGEMENT COMPANY          HYBRID NETWORKS, INC.


By: /s/ Brett A. Krause                   By: /s/ Judson W. Goldsmith
    -------------------------------           ----------------------------------
Name: Brett A. Krause                     Name: Judson W. Goldsmith

Title: AVP Business Operations            Title: Vice President of Finance

Dated: 8/8/01                             Dated: 8/15/01


                                       3
<PAGE>

                                    EXHIBIT A

THIS WARRANT AND THE SECURITIES  ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN  REGISTERED  UNDER THE  SECURITIES ACT OF 1933, AS AMENDED,  THE "ACT",  OR
UNDER  THE  SECURITIES  LAWS OF ANY  STATE.  THESE  SECURITIES  ARE  SUBJECT  TO
RESTRICTIONS ON TRANSFERABILITY  AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT
TO  REGISTRATION  OR EXEMPTION  THEREFROM AND IN  ACCORDANCE  WITH SECTION 6 AND
SECTION 11(b) HEREOF.  THE ISSUE OF THESE  SECURITIES  MAY REQUIRE AN OPINION OF
COUNSEL IN FORM AND SUBSTANCE  SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY
PROPOSED  TRANSFER OR RESALE IS IN  COMPLIANCE  WITH THE ACT AND ANY  APPLICABLE
STATE SECURITIES LAWS.

                           WARRANT FOR THE PURCHASE OF
                             SHARES OF COMMON STOCK
                                       OF
                              HYBRID NETWORKS, INC.
                            (a Delaware corporation)

                            DATED AS OF JULY 31,2001

          VOID AFTER 5:00 P.M., CENTRAL STANDARD TIME, ON JULY 31, 2006

     HYBRID  NETWORKS,  INC., a Delaware  corporation  (the  "Company"),  hereby
certifies  that Sprint  Corporation,  a Kansas  corporation  (together  with its
Affiliates  (as defined  below),  "Sprint"),  is  entitled to purchase  from the
Company,  at the time, in the amounts and during the period described in Section
3 below,  that  number  of  shares of  Common  Stock of the  Company  determined
pursuant to the provisions of Section 2 below, at the Purchase Price (as defined
below) then in effect.

1. Definitions.

     "Affiliate"  means any entity that,  directly or indirectly  through one or
more  intermediaries,  is controlled by, or is under common control with, Sprint
Corporation.

     "Common  Stock"  means the  Company's  common  stock,  par value $0.001 per
share, and stock of any other class of the equity of the Company into which such
shares may hereafter have been changed.

     "Conversion  Price"  means the price  per share for which  Common  Stock is
issuable upon the conversion or exchange of Convertible  Securities,  determined
by dividing (i) the total amount,  if any, received or receivable by the Company
as  consideration  for the  issuance of such  Convertible  Securities,  plus the
minimum aggregate amount of additional consideration payable to the Company upon
the conversion or exchange of such Convertible Securities, by (ii) the total

<PAGE>

maximum  number of  shares  of Common  Stock  issuable  upon the  conversion  or
exchange of all such Convertible Securities.

     "Convertible  Securities"  mean any securities  issued by the Company or an
affiliate  of the  Company  which  are  convertible  into or  exchangeable  for,
directly or indirectly, shares of Common Stock.

     "Exercise  Term" means any time  between the date hereof and July 31, 2006,
subject to the vesting schedule set forth in Section 2 hereof.

     "Market  Price" of a share of Common Stock on any day means (i) the average
closing price of a share of Common Stock for the twenty (20) consecutive trading
days preceding such day on the principal national  securities  exchange on which
the shares of Common  Stock are listed or admitted  to  trading,  or (ii) if not
listed or admitted to trading on any national securities  exchange,  the average
of the last reported  sales price for the twenty (20)  consecutive  trading days
preceding such day on the Nasdaq National Market,  or (iii) if not traded on the
Nasdaq National  Market,  the average of the highest reported bid and the lowest
reported  asked  prices on each of the  twenty  (20)  consecutive  trading  days
preceding such day in the  over-the-counter  market as furnished by the National
Association of Securities  Dealers,  Inc. automated quotation system, or (iv) if
such firm is not then  engaged in the  business of  reporting  such  prices,  as
furnished  by any similar  firm then  engaged in such  business  selected by the
Company or, if there is no such firm, as furnished by any member of the National
Association  of  Securities  Dealers,  Inc.  selected  by the Company or, if the
shares of Common  Stock are not publicly  traded,  the Market Price for such day
shall be equal to the price per share of the  Company's  Common  Stock (or other
capital stock of the Company  convertible into Common Stock at a 1:1 ratio) sold
in the Company's latest bona fide round of equity financing.

     "New Security" shall have the meaning set forth in Section 4(b) hereof.

     "Purchase Price" shall have the meaning set forth in Section 3(b) hereof.

     "Registered Holder" means; Sprint Corporation, together with its successors
and permitted assigns.

     "Strike Price" means the price per share for which Common Stock is issuable
upon the exercise of any rights,  options or warrants for the purchase of Common
Stock,  determined  by  dividing  (i) the  total  amount,  if any,  received  or
receivable by the Company as consideration for the grant of such rights, options
or  warrants,  plus the minimum  aggregate  amount of  additional  consideration
payable to the Company upon the exercise of such rights, options or warrants, by
(ii) the total  maximum  number of shares  of  Common  Stock  issuable  upon the
exercise of such rights, options or warrants.

     "Warrant Stock" means the shares of Common Stock or New Securities acquired
or acquirable  upon exercise of this Warrant,  any shares of Common Stock or New
Securities  issued  as (or  issuable  upon the  conversion  or  exercise  of any
warrant,  right  or  other  security  that is  issued  as) a  dividend  or other
distribution with respect to, or in exchange for, or in replacement


                                       5
<PAGE>

of, such shares of Common Stock,  or any other  interest in the Company that has
been or may be acquired upon exercise of this Warrant.

2. Vesting Schedule.

     A total of 600,000  shares of Common Stock shall be available  for purchase
hereunder  in  accordance  with the  following  schedule,  and such shares shall
remain available for purchase during the Exercise Term:

     (a) 200,000  shares of Common  Stock shall vest and become  exercisable  on
August 1, 2001;

     (b) 200,000  shares of Common  Stock shall vest and become  exercisable  on
September 5, 2001; and

     (c) 200,000  shares of Common  Stock shall vest and become  exercisable  on
September 30, 2001.

3. Exercise of Warrant.

     (a) In addition to the Registered  Holder's rights pursuant to Section 3(e)
hereof,  this Warrant may be  exercised at any time during the Exercise  Term by
the  Registered  Holder  in  whole  or in  part,  and  from  time  to  time,  by
surrendering  this Warrant,  with the purchase form appended hereto as Exhibit A
duly executed by such Registered Holder, at the principal office of the Company,
or at such other office or agency as the Company may  designate,  accompanied by
payment in full of the Purchase Price payable in respect of the number of shares
of Warrant Stock purchased upon such exercise. The Purchase Price may be paid by
a check drawn on the bank account of the  Registered  Holder or the surrender of
shares  pursuant to the Net Issue Election  provisions set forth in Section 3(e)
hereof.

     (b) As used herein,  the term "Purchase  Price," with respect to a share of
Warrant Stock, shall mean $1.20.

     (c) Each  exercise of this  Warrant  shall be deemed to have been  effected
immediately  prior to the close of  business  on the day on which  this  Warrant
shall have been surrendered to the Company as provided in subsection 3(a) above.
At  such  time,  the  person(s)  or  entity(ies)  in  whose  name or  names  any
certificates  for Warrant Stock shall be issuable upon such exercise as provided
in subsection 3(d) below shall be deemed to have become the holder or holders of
record of the Warrant Stock represented by such certificates.

     (d) As soon as practicable  after each exercise of this Warrant in whole or
in part,  and in any event within ten (10) days  thereafter,  the Company at its
expense will cause to be issued in the name of, and delivered to, the Registered
Holder, or, subject to the terms and conditions hereof, as the Registered Holder
(upon payment by the  Registered  Holder of any applicable  transfer  taxes) may
direct:


                                       6
<PAGE>

          (i) a  certificate  or  certificates  for the number of full shares of
     Warrant Stock to which such  Registered  Holder shall be entitled upon such
     exercise  plus, in lieu of any  fractional  share to which such  Registered
     Holder would otherwise be entitled,  cash in an amount determined  pursuant
     to Section 5 hereof; and

          (ii) in case such  exercise is in part only, a new warrant or warrants
     (dated the date hereof) of like tenor, with a new Warrant Schedule attached
     thereto  reflecting  the number of shares of Warrant  Stock equal  (without
     giving  effect to any  adjustment  therein)  to the  number of such  shares
     reflected in the Warrant Schedule  attached as Exhibit B to this Warrant on
     the date of such exercise minus the number of such shares  purchased by the
     Registered Holder upon such exercise as provided in subsection 3(a) above.

     (e) Net issue Election. The Registered Holder may elect to receive, without
the payment by the  Registered  Holder of any additional  consideration,  shares
equal to the value of this  Warrant or any portion  hereof by the  surrender  of
this Warrant or such portion to the Company,  with the net issue election notice
(attached  hereto as Exhibit  B) duly  executed,  at the office of the  Company.
Thereupon, the Company shall issue to the Registered Holder such number of fully
paid and nonassessable shares of Common Stock as is computed using the following
formula:

                                   X = Y(A-B)
                                       ------
                                         A

where

     X  = the number of shares to be issued to the Registered  Holder pursuant
          to this Section 3(e).

     Y  = the number of shares covered by this Warrant in respect of which the
          net issue election is made pursuant to this Section 3(e).

     A  = the  Market  Price of one share of Common  Stock at the time the net
          issue election is made pursuant to this Section 3(e).

     B  = the Purchase  Price in effect under this Warrant at the time the net
          issue election is made pursuant to this Section 3(e).

The Board of Directors of the Company  shall  promptly  respond in writing to an
inquiry by the  Registered  Holder as to the Market Price of one share of Common
Stock.


                                       7
<PAGE>

4. Adjustments.

     (a)  Adjustment  of Purchase  Price  Amount and Number of Shares Upon Stock
Splits. Dividends,  Distributions and Combinations. In case the Company shall at
any time subdivide its outstanding  shares of Common Stock into a greater number
of shares or issue a stock  dividend  or make a  distribution  with  respect  to
outstanding  shares of Common Stock or Convertible  Securities payable in Common
Stock or in  Convertible  Securities  which are  convertible  with no additional
consideration  into shares of Common Stock, the Purchase Price for all shares of
Warrant Stock issuable  immediately  prior to such subdivision or stock dividend
or distribution shall be proportionately  reduced (treating for such purpose any
such shares of Convertible Securities outstanding or payable as being the number
of shares of Common  Stock  issuable  upon their  conversion)  and the number of
shares of Warrant Stock proportionately  increased; and conversely,  in case the
shares of Common Stock of the Company shall be combined into a smaller number of
shares, the Purchase Price for all shares of Warrant Stock issuable  immediately
prior to such combination shall be  proportionately  increased and the number of
shares of Warrant Stock proportionately reduced.

     (b)   Reorganization   or   Reclassification.   In  case  of  any   capital
reorganization,  or of any reclassification of the capital stock, of the Company
(other  than a change  in par value or from par value to no par value or from no
par value to par value),  or any  consolidation  or merger of the  Company  with
another  corporation or other entity, or the sale of all or substantially all of
the  assets of the  Company  which  shall be  effected  in a manner by which the
holders of Common Stock shall be entitled  (either  directly or upon  subsequent
liquidation)  to equity  securities  with  respect to or in exchange  for Common
Stock,   then  this   Warrant   shall,   after  such   capital   reorganization,
reclassification  of  capital  stock,  merger  or sale of  assets,  entitle  the
Registered  Holder  hereof to purchase the kind and number of shares of stock or
other  securities  of  the  Company,  or  of  the  entity  resulting  from  such
consolidation  (the  "Surviving  Entity") to which the Registered  Holder hereof
would have been  entitled  if it had held the  Common  Stock  issuable  upon the
exercise   hereof   immediately   prior   to   such   capital    reorganization,
reclassification of capital stock,  consolidation,  merger or sale of assets. If
the  holders  of Common  Stock  shall be  entitled  to cash,  cash  equivalents,
nonequity  securities or other  property of the Company or the Surviving  Entity
("Property")  with respect to or in exchange for Common Stock, then this Warrant
shall,  after such capital  reorganization,  reclassification  of capital stock,
merger or sale of assets,  entitle the Registered  Holder hereof to purchase the
kind of issued and  outstanding  common  stock or other  equity  security of the
Company or the Surviving Entity ("New  Security"),  as the case may be, which is
most similar to the Common Stock,  which shall be in an amount equal to a number
of shares of the New  Security  having a Market Price on the  effective  date of
such capital  reorganization,  reclassification of capital stock, merger or sale
of assets  equal to the  Market  Price on such  effective  date of the  Property
issued  per share of the Common  Stock.  The  Company  shall not effect any such
capital reorganization, reclassification of capital stock, consolidation, merger
or sale of assets unless prior to the consummation  thereof the Surviving Entity
(if other than the Company)  resulting  therefrom or the corporation  purchasing
such assets shall, by written  instrument  executed and mailed to the Registered
Holder  hereof at the last address of such  Registered  Holder  appearing on the
books of the Company,  (i) assume the  obligation to deliver to such  Registered
Holder such shares of stock,  securities  or assets as, in  accordance  with the
foregoing  provisions,  such Registered Holder may be entitled to purchase,  and
(ii)  agree to be bound by all the terms of this  Warrant.  Furthermore,  in the
case of a capital


                                       8
<PAGE>

reorganization, reclassification of capital stock, consolidation, merger or sale
of assets which entitles the Registered  Holder to purchase New Securities under
this  Warrant,  the  Purchase  Price for all  shares of Warrant  Stock  issuable
immediately prior to such capital  reorganization,  reclassification  of capital
stock,  consolidation,  merger or sale of assets  shall be adjusted to equal the
price  determined by dividing the Purchase  Price for each such share of Warrant
Stock  immediately  prior to such capital  reorganization,  reclassification  of
capital stock,  consolidation,  merger or sale of assets by the number of shares
of New Securities the Registered Holder is entitled to receive for each share of
Common Stock hereunder.

     (c) Change in Strike Price, Conversion Price or Conversion Rate. If (A) the
Strike Price for any right,  option or warrant for the purchase of Common Stock,
(B) the Conversion  Price of any  Convertible  Security or (C) the rate at which
any Convertible Securities are convertible into or exchangeable for Common Stock
changes at any time  (other  than by reason of  provisions  designed  to protect
against  dilution),  the Purchase Price for all shares of Warrant Stock issuable
immediately  prior to the time such  event  occurs  shall be  readjusted  to the
Purchase  Price  which  would have been in effect at such time had such  rights,
options,  warrants or Convertible Securities still outstanding provided for such
changed Strike Price,  Conversion  Price or conversion rate, as the case may be,
at the time such  rights,  options or warrants  were  initially  granted or such
Convertible Securities were initially issued.

     (d)  Consideration  for  Stock.  In case  any  shares  of  Common  Stock or
Convertible  Securities  or any rights,  options or warrants to purchase  Common
Stock  or  Convertible  Securities  shall  be  issued  or  sold  for  cash,  the
consideration received therefor shall be deemed to be the amount received by the
Company  therefor,  without  deducting any expenses incurred or any underwriting
commissions  or  concessions  paid  or  allowed  by the  Company  in  connection
therewith.  In case any shares of Common Stock or Convertible  Securities or any
rights,  options or warrants to purchase Common Stock or Convertible  Securities
shall be issued or sold in whole or in part for  consideration  other than cash,
the amount of such consideration shall be deemed to be the fair value thereof as
determined  by the Board of  Directors  of the Company,  without  deducting  any
expenses incurred or any underwriting commissions or concessions paid or allowed
by the Company in connection  therewith.  In the event of any  consolidation  or
merger of the Company in which the Company is not the surviving  corporation  or
in the  event  of any  sale of all or  substantially  all of the  assets  of the
Company for stock or other securities of any  corporation,  the Company shall be
deemed  to have  issued a number  of  shares  of its  Common  Stock for stock or
securities of the other corporation computed on the basis of the actual exchange
ratio on which the transaction was predicated and for consideration equal to the
fair market value on the date of such transaction of such stock or securities of
the other  corporation  as  determined by the Board of Directors of the Company,
and if any such calculation  results in adjustment of the Purchase Price for all
shares of Warrant Stock then issuable hereunder, the determination of the number
of shares of Common Stock  issuable  upon  exercise of this Warrant  immediately
prior to such merger,  conversion or sale, for purposes of Section 4(b) shall be
made after giving effect to such adjustment of the Purchase Price.

     (e) Computation of Adjustments.  Upon each  computation of an adjustment in
the  Purchase  Price for any share of  Warrant  Stock  issuable  hereunder,  the
Purchase  Price for all such  shares of Warrant  Stock  shall be computed to the
nearest cent (i.e.,  fractions of .5 of a cent, or greater,  shall be rounded to
the highest cent) and the shares which may be purchased upon


                                       9
<PAGE>

exercise of this Warrant  shall be  calculated to the nearest whole share (i.e.,
fractions of one half of a share, or greater,  shall be treated as being a whole
share). No such adjustment shall be made, however, if the change in the Purchase
Price for any such share of Warrant Stock would be less than $.0l per share, but
any such lesser  adjustment shall be made at the time and together with the next
subsequent  adjustment  which,  together with any adjustments  carried  forward,
shall amount to $.01 per share or more.

     (f) Certain Prohibited Adjustments.  Notwithstanding anything herein to the
contrary, the Company agrees not to enter into any transaction which would cause
an  adjustment  of the  Purchase  Price to less than the par value of the Common
Stock.

     (g) Notice of  Adjustment  of Purchase  Price,  Number of Shares.  Upon any
adjustment  of  the  Purchase  Price  or  number  of  shares  of  Warrant  Stock
purchasable hereunder, the Company shall promptly give written notice thereof to
the  Registered  Holder,  setting  forth in  reasonable  detail  the  method  of
calculation and the facts upon which such calculation is based.

5. Fractional Shares.

     The  Company  shall not be  required  to issue  fractional  shares upon the
exercise of this Warrant.  If the  Registered  Holder would be entitled upon the
exercise of any rights  evidenced  hereby to receive a fractional  interest in a
share of Common Stock,  the Company shall,  upon such  exercise,  pay in lieu of
such fractional interest an amount in cash equal to the value of such fractional
interest,  calculated based upon the Market Price as of the date this Warrant is
exercised.

6. Limitation on Sales; Registration.

     (a) The  Company  will use its best  efforts  to amend  that  certain  1999
Amended and Restated Investor Rights  Agreement,  dated as of September 9, 1999,
among the Company, Sprint and the other parties thereto (the "Rights Agreement")
to  include  the  Warrant  Stock  in the  definition  of the  term  "Registrable
Securities" as that term is defined in the Rights Agreement. At all times during
the Exercise Term that the Rights Agreement is not so amended, the provisions of
Sections  6(c) through  6(f) hereof shall remain in full force and effect.  Once
the Rights  Agreement has been amended  pursuant to this Section 6(a),  Sections
6(c) through 6(f) shall terminate and have no further force and effect.

     (b) The Registered Holder  acknowledges that the Warrant Stock has not been
registered  under  the  Securities  Act of 1933,  as now in  force or  hereafter
amended,  or any  successor  legislation  (the  "Act"),  and agrees not to sell,
pledge, distribute, offer for sale, transfer or otherwise dispose of any Warrant
Stock in the absence of (i) an effective registration statement under the Act as
to such Warrant Stock, or (ii) an exemption from such registration. This warrant
and the Warrant  Stock shall be  imprinted  with a legend in  substantially  the
following form:

     THIS SECURITY HAS NOT BEEN REGISTERED  UNDER THE SECURITIES ACT OF 1933, AS
AMENDED,  OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD,  PLEDGED OR OTHERWISE
TRANSFERRED WITHOUT AN EFFECTIVE


                                       10
<PAGE>

REGISTRATION  THEREOF  UNDER SUCH ACT OR LAW  PURSUANT TO RULE 144 AND ANY STATE
EXEMPTION FROM REGISTRATION OR AN OPINION OF COUNSEL REASONABLY  SATISFACTORY TO
THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

     (c) Piggyback Registrations.

          (i) Right to Piggyback.  Whenever the Company proposes to register any
of its securities  under the Act, the Company will give prompt written notice to
the  Registered  Holder of its  intention to effect such  registration  and will
include in such registration all Warrant Stock with respect to which the Company
has received a written request from the Registered  Holder for inclusion therein
within 15 days after the receipt of the Company's notice.  The Company will pay,
or cause to be paid, the registration  expenses of the Registered  Holder in all
piggyback registrations.

          (ii)  Underwritten   Offering.  If  a  piggyback  registration  is  an
underwritten  primary or secondary  registration on behalf of the Company and/or
other  holders of the Common  Stock,  and the managing  underwriters  advise the
Company in writing  that in their  opinion the number of shares  requested to be
included in such registration  (including the Warrant Stock and any other shares
of Common Stock held by holders with registration rights, collectively, with the
Registered  Holder,  the "Holders") exceeds the number which can be sold in such
offering  without  materially and adversely  affecting the  marketability of the
offering, the Company will promptly furnish the Registered Holder with a copy of
the underwriter's  opinion and may, by written notice to the Registered  Holder,
include in such  registration  (i) first, the securities the Company proposes to
sell,  and (ii)  second,  the Common  Stock  requested  to be  included  in such
registration  pro rata  among the  Holders  on the basis of the number of shares
owned by each such Holder.

          (iii) Underwriting Agreement. In any registration in which the Warrant
Stock  is to be  included,  the  Registered  Holder  shall  be a  party  to  the
underwriting agreement entered into by the Company in connection therewith,  and
the  representations and warranties by, and the other agreements on the part of,
the Company and for the  benefit of the  underwriters  shall also be made to and
for the benefit of the Registered Holder.

          (iv)  Documents,  Etc.  The Company  shall  provide to the  Registered
Holder any and all documents,  statements,  opinions and forms as the Registered
Holder  reasonably  deems necessary for the Registered  Holder to participate in
any piggyback  registrations  and to facilitate  the  disposition of the Warrant
Stock covered by such registration  pursuant to the terms and conditions of this
Agreement and the applicable securities laws.

          (v) Indemnification. In the event of any piggyback registration of any
Warrant Stock under the Securities Act, and in connection with any  registration
statement or any other disclosure  document  pursuant to which securities of the
Company are sold,  the Company  will,  and hereby does,  jointly and  severally,
indemnify and hold harmless the  Registered  Holder,  its  directors,  officers,
fiduciaries,  and agents (each, a "Covered Person") against any losses,  claims,
damages or liabilities, joint or several, to which such Covered Person may be or
become


                                       11
<PAGE>

subject under the Act, any other  securities or other laws of any  jurisdiction,
common law or otherwise,  insofar as such losses, claims, damages or liabilities
(or actions or  proceedings  in respect  thereof) arise out of or are based upon
(1) any untrue  statement  or alleged  untrue  statement  of any  material  fact
contained or incorporated by reference in any  registration  statement under the
Act, any preliminary  prospectus or final prospectus  included  therein,  or any
amendment  or  supplement  thereto,  or any document  incorporated  by reference
therein, or any other such disclosure  document,  or (2) any omission or alleged
omission  to state  therein a material  fact  required  to be stated  therein or
necessary to make the statement therein not misleading,  and will reimburse such
Covered Person for any legal or any other expenses  incurred in connection  with
investigating or defending any such loss, claim,  damage,  liability,  action or
proceeding;  provided,  however the  Company  shall not be liable to any Covered
Person  in any  such  case to the  extent  that any such  loss,  claim,  damage,
liability,  action  or  proceeding  arises  out of or is  based  upon an  untrue
statement or alleged  untrue  statement or omission or alleged  omission made in
such registration statement, any such preliminary prospectus,  final prospectus,
amendment or supplement,  any document  incorporated  by reference or other such
disclosure  document in reliance upon and in conformity with written information
furnished to the Company  through an  instrument  duly  executed by such Covered
Person specifically stating that it is for use in the preparation thereof.

     (d) Demand  Registration.  On one  occasion at any time during the Exercise
Period,  upon the demand of the Registered Holder, the Company shall, as soon as
practicable thereafter but in no event later than 45 days following such demand,
file a registration  statement  covering such amount of the Warrant Stock as the
Registered Holder requests (a "Sprint  Registration  Statement") and, after such
filing,   the  Company  shall  use  reasonable  efforts  to  cause  such  Sprint
Registration  Statement to become  effective  and to maintain the  effectiveness
thereof for a period of one (1) year, or until such earlier date as such Warrant
Stock may be transferred  without  registration under the Act; provided that (i)
the effectiveness of the Sprint Registration Statement may be terminated earlier
if and to the extent that all of the Warrant  Stock shall have been  disposed of
by the holder or holders  thereof and (ii) the Company's  obligation  under this
Section 6(b) to file a Sprint Registration  Statement as soon as practicable and
to use reasonable efforts to cause such Sprint Registration  Statement to become
effective  shall be  suspended  in the event and during  such  period as certain
circumstances  exist  (such  circumstances  being  hereinafter  referred to as a
"Suspension  Event")  which  would make it  impractical  or  inadvisable  in the
Company's good faith opinion to file a Sprint Registration  Statement,  but such
suspension  shall only continue until (y) such event is no longer  continuing or
(z) ninety (90) days after the  commencement  of such  suspension,  whichever is
earlier.  A Suspension Event shall include,  but shall not be limited to, (1) an
underwritten  primary  offering  by the  Company  if the  Company  is advised in
writing by the managing  underwriter of such underwritten  offering that, in its
good  faith  judgment,  the  sale  of  securities  under a  Sprint  Registration
Statement would interfere with the successful  marketing of the securities to be
offered under such primary offering;  (2) pending  negotiations  relating to, or
existence  of  any  other  event,  fact  or  circumstance  which  would  require
disclosure by the Company in the Sprint  Registration  Statement of  information
regarding the Company or its business,  business plans,  financial  condition or
results of operations  which has not previously been disclosed by the Company in
a report  filed under the  Securities  Exchange Act of 1934,  as amended,  or by
public  announcement;  or (3) if the holder or holders of Warrant Stock on whose
behalf the Sprint Registration Statement is being prepared fails to


                                       12
<PAGE>

cooperate  with the Company and to furnish to the  Company  all  information  in
connection  with the  preparation  of the Sprint  Registration  Statement as the
Company may reasonably request.

     (e) All fees and expenses  incurred by the Company in  connection  with the
performance  of its  obligation  to  register  the  Warrant  Stock  pursuant  to
subsection  6(b)  shall  be  borne by the  Company;  provided  that any fees and
expenses  of the  holder or  holders  thereof  or of its or their  counsel,  and
transfer taxes  applicable to the sale of such Warrant Stock,  shall be borne by
such holder or holders.

     (f) The  Registered  Holder  agrees,  if  requested  by the  Company or the
representative of the underwriters  underwriting an offering of Common Stock (or
other  securities  of the Company)  from time to time,  not to sell or otherwise
transfer  or dispose of any  Warrant  Stock then held by the  Registered  Holder
during  such  reasonable  period of time  following  the  effective  date of any
registration  statement  of the  Company  (other  than the  Sprint  Registration
Statement)  filed  under the Act for the period of time with  respect to which a
majority of the  executive  officers of the Company  agree not to sell shares of
Common Stock (or other  securities of the Company).  Such agreement  shall be in
writing in a form  satisfactory  to the  Company  and such  representative.  The
Company may impose stop-transfer  instructions with respect to the Warrant Stock
subject to the foregoing restriction until the end of such period.

7. Representations.

     The  Registered  Holder  hereby  represents  and warrants to the Company as
follows. The Registered Holder is a sophisticated investor having such knowledge
and experience in business and investment  matters that the Registered Holder is
capable of protecting the Registered  Holder's own interests in connection  with
the acquisition,  exercise or disposition of this Warrant. The Registered Holder
is aware that this Warrant and the Warrant  Stock are being,  or will be, issued
to the Registered Holder in reliance upon the Registered Holder's representation
in this Section 7 and that such securities are restricted securities that cannot
be publicly sold except in certain prescribed situations.  The Registered Holder
is aware of the  provisions  of Rule 144  promulgated  under  the Act and of the
conditions under which sales may be made thereunder.  The Registered  Holder has
received  such  information  about the Company as the  Registered  Holder  deems
reasonable,  has had the  opportunity to ask questions and receive  answers from
the Company  with  respect to its  business,  assets,  prospects  and  financial
condition and has verified any answers the  Registered  Holder has received from
the Company with independent  third parties to the extent the Registered  Holder
deems necessary.  The Registered Holder of this Warrant,  by acceptance  hereof,
acknowledges  this  Warrant  and the Warrant  Stock to be issued  upon  exercise
hereof or  conversion  thereof  are being  acquired  solely  for the  Registered
Holder's  own  account  and  not as a  nominee  for  any  other  party,  and for
investment,  and that the  Registered  Holder will not offer,  sell or otherwise
dispose of this Warrant or any Warrant Stock to be issued upon  exercise  hereof
or  conversion  thereof  except  under  circumstances  that will not result in a
violation of the Act or any state securities laws.

8. Notices of Record Date, Etc.

     In the event that:


                                       13
<PAGE>

     (a)  the Company  shall set a record date for the purpose of  entitling  or
          enabling the holders of its Common Stock (or other stock or securities
          at the time  deliverable upon the exercise of this Warrant) to receive
          any  dividend  or  other  distribution,  or to  receive  any  right to
          subscribe  for or  purchase  any  shares  of stock of any class or any
          other securities, or to receive any other right, or

     (b)  there shall  occur any  capital  reorganization  of the  Company,  any
          reclassification   of  the   capital   stock  of  the   Company,   any
          consolidation   or  merger  of  the  Company   with  or  into  another
          corporation, or any transfer of all or substantially all of the assets
          of the Company, or

     (c)  there  shall  occur  any   voluntary   or   involuntary   dissolution,
          liquidation or winding-up of the Company,

then,  and in each such case, the Company will mail or cause to be mailed to the
Registered Holder a notice  specifying,  as the case may be, (i) the record date
for the purpose of such dividend,  distribution or right, and stating the amount
and character of such dividend,  distribution or right,  (ii) the effective date
of such reorganization,  reclassification,  consolidation, merger or transfer or
(iii) the date of such dissolution,  liquidation or winding-up is to take place,
and also specifying, if applicable, the date and time as of which the holders of
record  of  Common  Stock  (or  such  other  stock  or  securities  at the  time
deliverable  upon the  exercise of this  Warrant)  shall be entitled to exchange
their shares of Common Stock (or such other stock or securities)  for securities
or  other  property  deliverable  upon  such  reorganization,  reclassification,
consolidation,  merger, transfer,  dissolution,  liquidation or winding-up. Such
notice  shall be  mailed  at least ten (10)  days  prior to the  record  date or
effective date for the event specified in such notice.

9. Reservation of Stock.

     The  Company  will at all times  reserve  and keep  available,  solely  for
issuance and delivery upon the exercise of this Warrant,  such shares of Warrant
Stock and other stock,  securities  and property,  as from time to time shall be
issuable upon the exercise of this Warrant.

10. Replacement of Warrants.

     Upon  receipt of  evidence  reasonably  satisfactory  to the Company of the
loss, theft, destruction or mutilation of this Warrant and (in the case of loss,
theft or  destruction)  upon delivery of an indemnity  agreement (with surety if
reasonably required) in an amount reasonably satisfactory to the Company, or (in
the case of mutilation)  upon surrender and  cancellation  of this Warrant,  the
Company will issue, in lieu thereof, a new Warrant of like tenor.

11. Transfers, Etc.

     (a) The Company will maintain a register containing the names and addresses
of the Registered Holders of this Warrant. The Registered Holder may change its,
his or her  address as shown on the warrant  register  by written  notice to the
Company requesting such change.


                                       14
<PAGE>

     (b) This Warrant shall not be  transferable  by the  Registered  Holder and
shall be exercisable only by the Registered  Holder;  provided that this Warrant
may be transferred to, and may be exercisable by, any company that directly,  or
indirectly  through one or more  intermediaries,  is controlled  by, or is under
common control with, the Registered Holder.

     (c) Until any transfer of this Warrant is made in the warrant register, the
Company may treat the  Registered  Holder of this Warrant as the absolute  owner
hereof for all  purposes;  provided,  however,  that if and when this Warrant is
properly  assigned in blank,  the Company  may (but shall not be  obligated  to)
treat  the  bearer  hereof  as the  absolute  owner  hereof  for  all  purposes,
notwithstanding any notice to the contrary.

12. Mailing of Notices, Etc.

     All notices and other  communications  in connection with the Warrant shall
be mailed by first-class  certified or registered mail, postage prepaid,  to the
address listed below for each party or to such other address as such party shall
provide to the other party hereto pursuant to written notice.

     If to the Registered Holder, addressed to:

          Sprint Corporation
          6450 Sprint Parkway
          Overland Park, KS 66251
          Attn. AVP, BWG Business Operations
          Fax: (913) 315-0760

     With a copy to:

          Sprint Corporation
          2330 Shawnee Mission Parkway
          Westwood, KS 66205
          Attn. Vice President & Corporate Secretary
          Fax: (913) 624-2256

     If to the Company, addressed to:

          Hybrid Networks, Inc.
          6409 Guadalupe Mines Road
          San Jose, CA 95120-5000
          Attn: Michael Greenbaum
          Fax: (408) 323-6470

13. No Rights as Stockholder.

     Until the exercise of this Warrant,  the Registered  Holder of this Warrant
shall not have or exercise any rights by virtue hereof as a  stockholder  of the
Company.

14. Change or Waiver.


                                       15
<PAGE>

     Any term of this Warrant may be changed or waived only by an  instrument in
writing signed by the party against which enforcement of the change or waiver is
sought.

15. Headings.

     The headings in this  Warrant are for purposes of reference  only and shall
not limit or otherwise affect the meaning of any provision of this Warrant.

16. Governing Law.

     This Warrant shall be governed by and construed in accordance with the laws
of the State of Kansas.

17. Quarterly Financial Statements.

     At any time during the  Exercise  Term that the Company is not  required to
file quarterly and annual  reports with the Securities and Exchange  Commission,
the Company shall, not later than sixty (60) days after the end of each calendar
quarter  during the  Exercise  Term,  provide  the  Registered  Holder  with the
following financial statements:  income statement,  balance sheet,  statement of
cash flows and capitalization table (the "Financial Information").

                                              HYBRID NETWORKS, INC.

Dated: August 15, 2001                        By: /s/ Judson W. Goldsmith
                                                  ------------------------------
                                              Name:  Judson W. Goldsmith
                                                    ----------------------------
                                              Title: Vice President of Finance
                                                     Chief Financial Officer


                                       16
<PAGE>

                                    EXHIBIT A

                                  PURCHASE FORM

To: Hybrid Networks, Inc.
    6409 Guadalupe Mines Road
    San Jose, CA 95 120-5000

     The  undersigned  pursuant  to the  provisions  set  forth in the  attached
Warrant,  hereby irrevocably elects to purchase ___________ shares of the Common
Stock (the "Common Stock") covered by such Warrant and herewith makes payment of
$______,  representing  the full purchase price for such shares at the price per
share provided for in such Warrant.

     The undersigned  understands and acknowledges the terms and restrictions on
the right to transfer  or dispose of the Common  Stock set forth in Section 6 of
the  attached  Warrant,  which  the  undersigned  has  carefully  reviewed.  The
undersigned  consents  to the  placing  of a legend on its  certificate  for the
Common Stock  referring to such  restrictions  and the placing of stop  transfer
orders until the Common Stock may be transferred in accordance with the terms of
such restrictions.

                                             By: __________________________
                                                 Name: ____________________
                                                 Title: ___________________

                                                 Dated: ___________________


                                       17
<PAGE>

                                    EXHIBIT B

                            Net Issue Election Notice

To: Hybrid Networks, Inc.

                                             Date: _____________________________

     The undersigned  hereby elects under Section 3(e) to surrender the right to
purchase  ________  shares  of  Common  Stock  pursuant  to  this  Warrant.  The
certificate(s)  for the shares  issuable upon such net issue  election  shall be
issued in the name of the undersigned or as otherwise indicated below.

                                             [INSERT NAME OF REGISTERED
                                             HOLDER]

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                             Name for Registration:

                                             ___________________________________

                                             Mailing Address:

                                             ___________________________________
                                             ___________________________________
                                             ___________________________________
                                             ___________________________________