<PAGE>   1
                                                                    EXHIBIT 10.4

   
                           WARRANT PURCHASE AGREEMENT
    



       WARRANT PURCHASE AGREEMENT (this "Agreement"), dated as of June 16, 1997,
between Crescent Operating, Inc., a Delaware corporation (the "Company"), and
Magellan Health Services, Inc., a Delaware corporation (the "Buyer").

       WHEREAS, the Company desires to sell to Buyer, and Buyer desires to
purchase from the Company, warrants to purchase shares of common stock of the
Company, par value $.01 per share ("Common Stock");

       WHEREAS, the Company, Buyer and Crescent Real Estate Equities Limited
Partnership, a Delaware limited partnership ("Crescent"), have agreed to
certain related transactions pursuant to the Transaction Documents (as defined
in that certain Real Estate Purchase and Sale Agreement, dated January 29,
1997, by and between Buyer and Crescent (together with all subsequent
amendments, the "REIT Purchase Agreement");

       NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Company and Buyer hereby agree as follows:

                                   ARTICLE I

                            TERMS OF THE TRANSACTION

       1.1    Sale and Purchase of Warrants.  On the terms and subject to the
conditions set forth in this Agreement, the Company hereby sells to Buyer, and
Buyer hereby purchases from the Company, warrants (collectively, the "Warrants")
to purchase shares of Common Stock.  The Warrants shall be exercisable as set
forth on Annex 1 and shall constitute the right to purchase that number of
shares of Common Stock set forth on Annex 1, which number represents
approximately two and one-half percent (2.5%) of the Common Stock of the Company
outstanding on the date hereof, on a fully diluted basis (subject to adjustment
from time to time as provided in the Warrants).  The Warrants shall be in
substantially the form set forth as Exhibit A hereto (except for the number of
shares and the exercise period which shall be in accordance with Annex 1).

       1.2    Purchase Price and Payment.  The parties hereto acknowledge that
the Purchase Price for the Warrants was made by them in arm's length
negotiation.  The aggregate purchase price for the Warrants is Ten and No/100
Dollars ($10.00)  (the "Purchase Price").

       1.3    Defined Terms.  A list of terms used in this Agreement is set
forth in Article XI.
<PAGE>   2
                                   ARTICLE II

                            CLOSING AND CLOSING DATE

       The Closing of the transactions contemplated hereby shall occur at the
time of the closing of the REIT Purchase Agreement and upon satisfaction of the
conditions to Closing set forth herein and therein.  The date on which the
Closing is required to take place is herein referred to as the "Closing Date."
The closing of all of the transactions contemplated hereby shall be deemed to
have occurred simultaneously.

                                  ARTICLE III

                 REPRESENTATIONS AND WARRANTIES OF THE COMPANY

       The Company represents and warrants to Buyer, as of the date hereof,
that:

       3.1    Corporate Organization.  The Company is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Delaware and has all requisite corporate power and authority in all material
respects to own, lease, and operate its properties and to carry on its business
as now being conducted.  No actions or proceedings to dissolve the Company are
pending or, to the best knowledge of the Company, are threatened.

       3.2    Capitalization of the Company.

              (a)    The authorized capital stock of the Company consists of (i)
22,500,000 shares of Common Stock, of which, as of the date hereof no more than
11,025,547 shares are outstanding and no shares are held in the Company's
treasury, and (ii) 10,000,000 shares of Preferred Stock, par value $.01 per
share, of which, as of the date hereof, no shares are outstanding.  All
outstanding shares of capital stock of the Company have been validly issued and
are fully paid and nonassessable, and no shares of capital stock of the Company
are subject to, nor have any been issued in violation of, preemptive or similar
rights.  As of the date hereof, 1,000,000 shares of Common Stock are reserved
for issuance upon exercise of options granted pursuant to the 1997 Crescent
Operating, Inc. Amended Stock Incentive Plan adopted by the Board of Directors
of the Company on May 8, 1997. As of the date hereof, 225,000 shares of Series A
Junior Preferred Stock are reserved for issuance upon exercise of Preferred
Share Purchase Rights pursuant to the Preferred Share Purchase Rights Agreement
adopted by the Board of Directors of the Company on June 3, 1997.

              (b)    Except as set forth above in subparagraph (a) of this
Section 3.2 and as contemplated by this Agreement, there are outstanding (i) no
shares of capital stock or other voting securities of the Company; (ii) no
securities of the Company convertible into or exchangeable for shares of
capital stock or other voting securities of the Company; (iii) no options or
other rights to acquire from the Company, and no obligation of the Company to
issue or sell, any shares of capital stock or other voting securities of the
Company or any securities of the Company convertible into or exchangeable for
such capital stock or voting securities; and (iv) other than employee
compensation plans based on the Company's earnings and executive officer
employment agreements, no equity equivalents, interests in the ownership or
earnings, or other similar rights of or with respect to the Company.  There are
no outstanding contractual





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<PAGE>   3
obligations of the Company to repurchase, redeem or otherwise acquire any
shares of Common Stock or any other securities of the type described in clauses
(i)-(iv) of the preceding sentence.

       3.3    Authority Relative to This Agreement.  The Company has full
corporate power and authority to execute, deliver, and perform this Agreement
to which it is a party and to consummate the transactions contemplated hereby.
The execution, delivery, and performance by the Company of this Agreement, and
the consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action of the Company.  This Agreement
has been duly executed and delivered by the Company and constitutes, and the
Warrant, when executed by the Company will be, a valid and legally binding
obligation of the Company, enforceable against the Company in accordance with
its terms, except that such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting
creditors' rights generally or by general principles of equity.

       3.4    Noncontravention.  The execution, delivery, and performance by
the Company of this Agreement and the Warrants and the consummation by it of
the transactions contemplated hereby do not and will not (i) conflict with or
result in a violation of any provision of the Company's First Amended and
Restated Certificate of Incorporation or the Company's Amended and Restated
Bylaws, or the charter, bylaws or other governing instruments of any Subsidiary,
(ii) conflict with or result in a violation of any provision of, or constitute
(with or without the giving of notice or the passage of time or both) a default
under, or give rise (with or without the giving of notice or the passage of time
or both) to any right of termination, cancellation, or acceleration under, any
bond, debenture, note, mortgage, indenture, lease, agreement, or other
instrument or obligation to which the Company or any Subsidiary is a party or by
which the Company or any Subsidiary or any of their respective properties may be
bound, (iii) result in the creation or imposition of any Encumbrance upon the
properties of the Company or any Subsidiary, or (iv) assuming compliance with
the matters referred to in Section 3.5, violate any Applicable Law binding upon
the Company or any Subsidiary, except, in the case of clauses (ii), (iii), and
(iv) above, for any such conflicts, violations, defaults, terminations,
cancellations, accelerations, or Encumbrances which would not, individually or
in the aggregate, have a material adverse effect on the business, assets,
results of operations, or financial condition of the Company and the
Subsidiaries taken as a whole or the ability of the Company to consummate the
transactions contemplated hereby.

       3.5    Governmental Approvals.  No consent, approval, order, or
authorization of, or declaration, filing, or registration with, any
Governmental Entity is required to be obtained or made by the Company or any
Subsidiary in connection with the execution, delivery, or performance by the
Company of this Agreement or the consummation by it of the transactions
contemplated hereby, other than (i) compliance with any applicable requirements
of the HSR Act; (ii) compliance with any applicable requirements of the
Securities Act; (iii) compliance with any applicable requirements of the
Exchange Act; (iv) compliance with any applicable state securities laws; and
(v) such consents, approvals, orders, or authorizations which, if not obtained,
and such declarations, filings, or registrations which, if not made, would not,
individually or in the aggregate, have a material adverse effect on the
business, assets, results of operations, or financial condition of the Company
or on the ability of the Company to consummate the transactions contemplated
hereby.  The representations and warranties of the Company contained in this






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<PAGE>   4
Section 3.5, insofar as such representations and warranties pertain to
compliance by the Company with the requirements of the Securities Act and
applicable state securities laws, are based on the representations and
warranties of Buyers contained in Section 4.5.

       3.6    Authorization of Issuance: Reservation of Shares.  When issued
and delivered pursuant to this Agreement against payment therefor, the Warrants
will have been duly authorized, issued and delivered and will constitute valid
and legally binding obligations of the Company entitled to the benefits
provided therein.  During the period within which the Warrants may be
exercised, the Company will at all times have authorized and reserved for the
purpose of issue upon exercise of the Warrants, a sufficient number of shares
of Common Stock to provide for the exercise of the Warrants.  All shares of
Common Stock which are issuable upon exercise of the Warrants (the "Warrant
Shares") will, when issued, be validly issued, fully paid and nonassessable.
Upon exercise of the Warrants the issuance of the Warrant Shares will not be
subject to any preemptive or similar rights.

                                   ARTICLE IV

                    REPRESENTATIONS AND WARRANTIES OF BUYER

       Buyer represents and warrants to the Company that:

       4.1    Organization.  Buyer is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its formation.

       4.2    Authority Relative to This Agreement.  Buyer has full power and
authority to execute, deliver, and perform this Agreement and to consummate the
transactions contemplated hereby.  The execution, delivery, and performance by
Buyer of this Agreement, and the consummation by it of the transactions
contemplated hereby, have been duly authorized by all necessary action of
Buyer.  This Agreement has been duly executed and delivered by Buyer and
constitutes a valid and legally binding obligation of Buyer, enforceable
against Buyer in accordance with its terms, except that such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
and similar laws affecting creditors' rights generally or by general principles
of equity.

       4.3    Noncontravention.  The execution, delivery, and performance by
Buyer of this Agreement and the consummation by it of the transactions
contemplated hereby do not and will not (i) conflict with or result in a
violation of any provision of the charter, bylaws, or similar organizational
documents of Buyer, (ii) conflict with or result in a violation of any
provision of, or constitute (with or without the giving of notice or the
passage of time or both) a default under, or give rise (with or without the
giving of notice or the passage of time or both) to any right of termination,
cancellation, or acceleration under, any bond, debenture, note, mortgage,
indenture, lease, agreement, or other instrument or obligation to which Buyer
is a party or by which Buyer or any of its properties may be bound, (iii)
result in the creation or imposition of any Encumbrance upon the properties of
Buyer, or (iv) violate any Applicable Law binding upon Buyer, except, in the
case of clauses (ii), (iii), and (iv) above, for any such conflicts,
violations, defaults,






                                      -4-
<PAGE>   5
terminations, cancellations, accelerations, or Encumbrances which would not,
individually or in the aggregate, have a material adverse effect on the
business, assets, results of operations, or financial condition of Buyer or on
the ability of Buyer to consummate the transactions contemplated hereby.

       4.4    Governmental Approvals.  Other than any HSR Act filing, no
consent, approval, order, or authorization of, or declaration, filing, or
registration with, any Governmental Entity is required to be obtained or made
by Buyer in connection with the execution, delivery, or performance by Buyer of
this Agreement or the consummation by it of the transactions contemplated
hereby.

       4.5    Purchase for Investment.  Buyer has been furnished with all
information that it has requested for the purpose of evaluating the proposed
acquisition of the Warrants pursuant hereto, and Buyer has had an opportunity
to ask questions of and receive answers from the Company regarding the Company
and its business, assets, results of operations, and financial condition and
the terms and conditions of the issuance of the Warrants.  Buyer is acquiring
the Warrants to be purchased by it for its own account for investment and not
for distribution in any manner that would violate applicable securities laws.
Buyer can bear the risk of an investment in the Warrants, and has such
knowledge and experience in financial and business matters that it is capable
of evaluating the merits and risks of a prospective investment in the Warrants.
The acquisition of such Warrants by Buyer at Closing shall constitute Buyer's
confirmation of the foregoing representations.  Buyer understands that such
Warrants are being sold to it in a transaction which is exempt from the
registration requirements of the Securities Act, and that, in making the
representations and warranties contained in Section 3.5 pertaining to
compliance by the Company with the requirements of the Securities Act and
applicable securities laws, the Company is relying, to the extent applicable,
upon Buyer's representations set forth herein.

       4.6    No Other Shares.  Except for such rights as may be conferred on
Buyer by this Agreement, as of the date hereof, Buyer does not beneficially
own, directly or indirectly through any subsidiary or through any affiliate of
Buyer in which Buyer directly or indirectly owns stock or equity interests, any
shares of capital stock of the Company.

                                   ARTICLE V

                             ADDITIONAL AGREEMENTS

       5.1    Press Releases.  Except as may be required by Applicable Law,
neither Buyer, on the one hand, nor the Company, on the other, shall issue any
press release with respect to this Agreement or the transactions contemplated
hereby without the prior written consent of the other party (which consent
shall not be unreasonably withheld under the circumstances).  Any such press
release required by Applicable Law shall only be made after reasonable notice
to the other party.

       5.2    Stock Exchange Listing.  The Company shall use its commercially
reasonable best efforts to cause the Warrant Shares to be approved for listing
on a national securities exchange, subject to official notice of issuance,
quoted in the over-the-counter market or quoted






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<PAGE>   6
on the NASDAQ Stock Market, prior to any exercise by the Company or Crescent of
its rights to acquire shares of common stock of Buyer under that certain
Warrant Purchase Agreement dated as of June 16, 1997 between the Company and
the Buyer and that certain Warrant Purchase Agreement dated as of January 29,
1997, as subsequently amended between Crescent and the Buyer (collectively, the
"Magellan Warrant").

       5.3    Registration Rights.

              (a)    Registration of Warrant Shares.  On or before the date
that the Company or Crescent first exercises its rights to acquire shares of
common stock under the Magellan Warrant, the Company will use its commercially
reasonable best efforts to obtain effectiveness of a registration statement
under the Securities Act with respect to the issuance of the Warrant Shares
upon exercise of the Warrants and the resale of the Registrable Warrant Shares.

              (b)    Registration Procedures.  With respect to each
registration statement filed in accordance with this Section 5.3 (the
"Registration Statement"), the Company shall:

                     (i)    cause the Registration Statement and the related
       prospectus and any amendment or supplement, (A) to comply in all
       material respects with the applicable requirements of the Securities Act
       and under the rules and regulations promulgated thereunder, and (B) not
       to contain any untrue statement of a material fact or omit to state a
       material fact required to be stated therein or necessary to make the
       statements therein not misleading;

                     (ii)   prepare and file with the Commission such
       amendments and supplements to the Registration Statement and the
       prospectus used in connection therewith, and upon the mandatory
       expiration of the Registration Statement, one or more additional
       registration statements, as may be necessary to keep the Registration
       Statement effective on a continual basis for so long as the Buyer or its
       permitted transferee owns any Underlying Warrant Shares; provided that
       the Company shall not be required to maintain the effectiveness of any
       Registration Statement filed hereunder for a period in excess of twelve
       years and ninety (90) days from the Closing Date;

                     (iii)  furnish, upon written request, to Buyer a copy of
       any amendment or supplement to the Registration Statement or prospectus
       prior to filing it after effectiveness and not file any such amendment
       or supplement to which Buyer shall have reasonably objected on the
       grounds that such amendment or supplement does not comply in all
       material respects with the requirements of the Securities Act or of the
       rules or regulations promulgated thereunder;

                     (iv)   furnish to Buyer such number of copies of the
       Registration Statement, each amendment and supplement thereto, the
       prospectus used in connection therewith (including, without limitation,
       each preliminary prospectus and final prospectus) and such other
       document as Buyer may reasonably request in order to facilitate the
       disposition of the Registrable Warrant Shares owned by Buyer;






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<PAGE>   7
                     (v)    use its best efforts to register or qualify all
       Registrable Warrant Shares covered by the Registration Statement under
       such other securities or blue sky laws of the states of the United
       States as may be required for the issuance and sale of the Registrable
       Warrant Shares, to keep such registration or qualification in effect for
       so long as the Registration Statement remains in effect except that the
       Company shall not for any such purpose be required to qualify generally
       to do business as a foreign corporation in any jurisdiction in which it
       is not and would not, but for the requirements of this Section 5.3, be
       obligated to be so qualified, or to subject itself to taxation in any
       such jurisdiction, or to consent to general service of process in any
       such jurisdiction;

                     (vi)   prior to any sale of the Registrable Warrant Shares
       effected on a national securities exchange, deliver to such national
       securities exchange copies of the prospectus to be used in connection
       with the offering to be conducted pursuant to the Registration
       Statement;

                     (vii)  upon discovery that, or upon the happening of any
       event as a result of which, the prospectus included in the Registration
       Statement, as then in effect, includes or in the judgment of the Company
       may include an untrue statement of a material fact or omits or may omit
       to state any material fact required to be stated in such prospectus or
       necessary to make the statements in such prospectus not misleading in
       the light of the circumstances in which they were made, which
       circumstance requires amendment of the Registration Statement or
       supplementation of the prospectus, prepare and file as promptly as
       reasonably possible a supplement to or an amendment of such prospectus
       as may be necessary so that, as when delivered (if required by the
       Securities Act) to a purchaser of Registrable Warrant Shares, such
       prospectus shall not include an untrue statement of a material fact or
       omit to state a material fact required to be stated in such prospectus
       or necessary to make the statements in such prospectus not misleading in
       the light of the circumstances in which they were made;

                     (viii) otherwise use its commercially reasonable best
       efforts to comply with all applicable rules and regulations under the
       Securities Act and, in its discretion, to make available to its
       securities holders, as soon as reasonably practicable, an earnings
       statement covering the period of at least twelve months, but not more
       than eighteen months, beginning with the first month of the first fiscal
       quarter after the effective date of the Registration Statement, which
       earnings statement shall satisfy the provisions of section 11(a) of the
       Securities Act;

                     (ix)   provide and cause to be maintained a transfer agent
       and registrar for all Registrable Warrant Shares covered by the
       Registration Statement from and after a date not later than the
       effective date of the Registration Statement;

                     (x)    use its commercially reasonable best efforts to
       list all Registrable Warrant Shares covered by the Registration
       Statement on any national securities






                                      -7-
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       exchange on which securities of the same class as the Registrable
       Warrant Shares are then listed;

                     (xi)   after any sale of the Registrable Warrant Shares
       pursuant to this Section 5.3, to the extent not prohibited by law, cause
       any restrictive legends to be removed and any transfer restrictions to
       be rescinded with respect to the Registrable Warrant Shares;

                     (xii)  enter into such customary agreements (including,
       without limitation, underwriting agreements in customary form,
       substance, and scope) and take all such other actions as the holders of
       a majority of the Registrable Warrant Shares being sold or the
       underwriters, if any, reasonably request in order to expedite or
       facilitate the disposition of such Warrant Shares;

                     (xiii) in the event of the issuance of any stop order
       suspending the effectiveness of the Registration Statement, or of any
       order suspending or preventing the use of any related prospectus or
       suspending the disqualification of any Common Stock included in the
       Registration Statement for sale in any jurisdiction, the Company will
       use its commercially reasonable best efforts promptly to obtain the
       withdrawal of such order; and

                     (xiv)  use its commercially reasonable best efforts to
       cause such Registrable Warrant Shares covered by the Registration
       Statement to be registered with or approved by such other governmental
       agencies or authorities as may be necessary to enable the Buyer thereof
       to consummate the disposition of such Warrant Shares.

              (c)    Obligations of Buyer.  The Buyer holding Registrable
Warrant Shares shall furnish to the Company such information regarding the
Buyer as the Company may from time to time reasonably request in writing (and
will notify the Company of any changes in such information) and as shall be
required by the Securities Act in connection with such registration.

              (d)    Delay of Sales.  During any period in which the Company is
maintaining the effectiveness of a Registration Statement for the Registrable
Warrant Shares pursuant to this Section 5.3, the Company shall have the right,
upon giving notice to the Buyer holding Registrable Warrant Shares of the
exercise of such right, to require the Buyer not to sell any Registrable
Warrant Shares pursuant to such Registration Statement for a period of time the
Company deems reasonably necessary, which time shall be specified in such
notice but in no event longer than a period of 90 days, if (i) the Company is
engaged in an offering of shares by the Company for its own account or is
engaged in or proposes to engage in discussions or negotiations with respect
to, or has proposed or taken a substantial step to commence, or there otherwise
is pending, any merger, acquisition, other form of business combination,
divestiture, tender offer, financing or other transaction, or there is an event
or state of facts relating to the Company, in each case which is material to
the Company (any such negotiation, step, event or state of facts being herein
called a "Material Activity"), (ii) such Material Activity would, in the
opinion of counsel for the Company reasonably acceptable to Buyer, require
disclosure so as to permit the Registrable






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<PAGE>   9
Warrant Shares to be sold in compliance with applicable law, and (iii) such
disclosure would, in the reasonable judgment of the Company, be adverse to its
interests in any material respect.  The Company shall have no obligation to
include in any notice contemplated by this subparagraph (f) any reference to or
description of the facts based upon which the Company is delivering such
notice.

              (e)    Indemnification.

                     (i)    The Company shall indemnify and hold harmless the
       Buyer holding Registrable Warrant Shares and its directors, Affiliates
       and officers, and each other person, if any, who controls the Buyer
       within the meaning of the Securities Act against any losses, claims,
       damages, liabilities or expenses (including reasonable fees and expenses
       of counsel), joint or several, to which the Buyer or any such director,
       Affiliate or officer or participating or controlling person may become
       subject under the Securities Act or otherwise in connection with or as a
       result of a sale by the Buyer of the Registrable Warrant Shares, insofar
       as such losses, claims, damages, liabilities or expenses (or related
       actions or proceedings) arise out of or are based upon (i) any untrue
       statement of any material fact contained in the Registration Statement,
       any preliminary prospectus, final prospectus or summary prospectus
       contained in the Registration Statement, or any amendment or supplement
       to the Registration Statement, or any document incorporated by reference
       in the Registration Statement, or (ii) any omission to state in any such
       document a material fact required to be stated in any such document or
       necessary to make the statements in any such document not misleading,
       and the Company will reimburse the Buyer and each such director,
       Affiliate, officer, participating person and controlling person for any
       legal or any other expenses reasonably incurred by them in connection
       with investigating or defending any such loss, claim, damage, liability
       or expense (or action or proceeding in respect of any such loss, claim,
       damage, liability or expense) which arises out of or is based upon an
       untrue statement or omission made in the Registration Statement, any
       such preliminary prospectus, final prospectus, summary prospectus,
       amendment or supplement except for any untrue statement or omission made
       in reliance upon and in conformity with written information furnished to
       the Company by the Buyer or any such director, Affiliate, officer,
       participating person or controlling person for use in the preparation of
       the Registration Statement.  Such indemnity shall remain in full force
       and effect regardless of any investigation made by or on behalf of the
       Buyer or any such director, Affiliate, officer, participating person or
       controlling person and shall survive the transfer of Registrable Warrant
       Shares by the Buyer.

                     (ii)   The Buyer shall indemnify and hold harmless (in the
       same manner and to the same extent as set forth in clause (i) of this
       subparagraph (f)) the Company, each director of the Company, each
       officer of the Company who shall sign the Registration Statement and
       each other person, if any, who controls the Company within the meaning
       of the Securities Act, with respect to any untrue statement in or
       omission from the Registration Statement, any preliminary prospectus,
       final prospectus or summary prospectus included in the Registration
       Statement, or any amendment or supplement to the Registration Statement,
       but only to the extent that such statement or omission was made






                                      -9-
<PAGE>   10
       in direct reliance upon and in conformity with written information
       furnished to the Company by the Buyer for use in the preparation of the
       Registration Statement, preliminary prospectus, final prospectus,
       summary prospectus, amendment or supplement.  Such indemnity shall
       remain in full force and effect regardless of any investigation made by
       or on behalf of the Company or any such director, officer or controlling
       person and shall survive the transfer of the Registrable Warrant Shares
       by the Buyer.

                     (iii)  Indemnification under this Section 5.3 shall be
       made as set forth in Article IX hereof.

              (f)    Registration Expenses.  All expenses incident to the
Company's registration of the Registrable Warrant Shares pursuant to the
provisions of this Section 5.3, including, without limitation, all registration
and filing fees, fees and expenses of compliance with securities or blue sky
laws, printing and engraving expenses, messenger and delivery expenses and
fees and disbursements of counsel for the Company and all independent certified
public accountants, underwriters (excluding underwriting discounts and any
selling commissions) and any persons retained by the Company (all such expenses
being herein called "Registration Expenses"), will be paid by the Company;
provided, that, all expenses incurred by the Buyer holding Registrable Warrant
Shares to retain any counsel, accountant or other advisor will not be deemed to
be Registration Expenses and will be paid by the Buyer.  The underwriting
discounts or commissions and any selling commissions together with any stock
transfer or similar taxes attributable to sales of the Registrable Warrant
Shares will be paid by the Buyer.

       5.4    Fees and Expenses.  The parties shall each pay their own fees and
expenses and those of their agents, advisors, attorneys and accountants with
respect to the negotiation and execution of this Agreement.

       5.5    Restrictions on Transfers: Restrictions on Exercise of Warrants.

              (a)    Restrictions on Transfer of Warrants and Warrant Shares.
Subject to the provisions of subsections (b) and (c), without having obtained
the prior written consent of the Company, the Buyer shall not:

                     (i)    sell or transfer any of the Warrants held by it to
       any other person, except for Excluded Transfers (as defined below) or to
       a wholly owned Subsidiary; provided, however, that Buyer may pledge the
Warrants under its Amended and Restated Credit Agreement dated the date hereof
among Buyer, The Chase Manhattan Bank and certain other banking and financial
institutions; and

                     (ii)   prior to the twelfth anniversary of the Closing
       Date, except for an Excluded Transfer, sell or transfer in a privately
       negotiated transaction to a single purchaser and its Affiliates, or any
       "Group" (as such term is defined in Rule 13d-5(b)(1) under the Exchange
       Act) any combination of Warrants and/or Warrant Shares, if the aggregate
       number of Warrant Shares and Underlying Warrant Shares to be so
       transferred equals 5% or more of the Common Stock then outstanding on a
       fully-diluted basis (i.e. including all shares of Common Stock issuable
       under the terms of any options, warrants and similar rights).






                                      -10-
<PAGE>   11
              (b)    Exceptions to Transfer Restrictions.  Notwithstanding
subsection (a),  the Buyer may sell or transfer any of the Warrants and/or
Warrant Shares to any person pursuant to, as a result of, or in connection with
(i) a tender offer or an exchange offer approved by the Board of Directors of
the Company; (ii) the consummation of a merger (provided the Company is not the
surviving corporation in such merger), consolidation, or a sale of all or
substantially all the assets of the Company; or (iii) any other "Fundamental
Change Transaction" (as such term is defined in the Warrant) (any transfer
pursuant to this Section 5.5(b), an "Excluded Transfer").

              (c)    Transferees.  During the period in which the restrictions
set forth in this Section 5.5 remain applicable, neither Buyer nor any
transferee shall be entitled to, directly or indirectly, sell or transfer any
of the Warrants and/or Warrant Shares in an Excluded Transfer to any person who
is not a party to this Agreement, unless the purported transferee executes an
instrument acknowledging that it is bound by the terms of this Section 5.5 and
such instrument is delivered to the Company.

       5.6    Indemnification of Brokerage.  Each of the parties hereto agrees
to indemnify and hold harmless each other party from and against any claim or
demand for a commission or other compensation by any financial advisor, broker,
agent, finder, or similar intermediary claiming to have been employed by or on
behalf of such indemnifying party and to bear the cost of legal fees and
expenses incurred in defending against any such claim or demand.

       5.7    Delivery of Information.  The Company will deliver to the Buyer
promptly upon the filing thereof, copies of all registration statements (other
than the exhibits thereto and any registration statements on Form S-8 or its
equivalent) and reports on Forms 10-K (or their equivalents) which the Company
shall have filed with the Commission or any similar reports filed with any
state securities commission or office.

       5.8    Rule 144 and Rule 144A Information.  With a view to making
available to the Buyer the benefits of Rule 144 and Rule 144A promulgated under
the 1933 Act and any other rule or regulation of the Commission that may at any
time permit the Buyer to sell Common Stock of the Company to the public without
registration, the Company agrees to:

                     (i)    make and keep public information available, as
       those terms are understood and defined in Rule 144;

                     (ii)   file with the Commission in a timely manner all
       reports and other documents required of the Company under the Securities
       Act and the Exchange Act; and

                     (iii)  furnish to Buyer forthwith upon request (A) a
       written statement by the Company that it has complied with the reporting
       requirements of Rule 144, the Securities Act and the Exchange Act, (B) a
       copy of the most recent annual or quarterly report of the Company and
       such other reports and documents so filed by the Company under the
       Securities Act and the Exchange Act and (C) such other information as
       may be






                                      -11-
<PAGE>   12
       reasonably requested by each Buyer in availing itself of any rule or
       regulation of the Commission which permits the selling of any such
       securities without registration; and

                     (iv)   comply with all rules and regulations of the
       Commission applicable to the Company in connection with use of Rule 144A
       (or any successor thereto); and

                     (v)    within five business days of the Company's receipt
       of a request made by, or on behalf of, any prospective transferee who is
       a Qualified Institutional Buyer (as defined in Rule 144A) and would be
       purchasing Common Stock of the Company in reliance upon Rule 144A),
       provide to such prospective transferee copies of annual audited and
       quarterly unaudited financial statements of the Company for it to comply
       with Rule 144A.

       5.9    Standstill.

              (a)    General.  Buyer agrees that during the four year period
ending on the anniversary of the Closing Date, it will not, and it will cause
its Affiliates and employees not to, purchase additional shares of the
Company's Common Stock (or other Equity Securities) so that Buyer and its
Affiliates and employees collectively own 20% or more of the Company's Common
Stock then outstanding; provided, however, that Buyer and its Affiliates and
employees shall not be deemed to own 20% or more of the Common Stock then
outstanding solely by reason of the Company's purchase of any Common Stock
unless thereafter Buyer and its Affiliates and employees purchase any
additional shares of Common Stock (excluding any acquisition of Warrant Shares
upon exercise of the Warrants, which shall not be restricted hereunder).

              (b)    Additional Standstill Obligations.  Buyer further agrees
that during the twelve year period ending on the anniversary of the Closing
Date, it will not, and it will cause its Affiliates and employees not to,
without prior Company consent, (i) effect or cause to be effected any (A)
"solicitation" of "proxies" (as such terms are used in the proxy rules of the
Commission) with respect to the Company or any action resulting in such person
becoming a "participant" in any "election contest" (as such terms are used in
the proxy rules of the Commission) with respect to the Company, or (B) any
tender or exchange offer or offer for a merger, consolidation, share exchange
or business combination involving the Company or substantially all of its
assets, (ii) propose any matter for submission to a vote of the stockholders of
the Company, or (iii) sell any shares of the Company's Common Stock (or other
Equity Securities) short.

       5.10   Notices.  The Company agrees to give the Buyer notice of any of
the events referred to in Section 4(g) of the Warrants at least five (5)
Business Days prior to any record date established or related to any such event
which the Buyer agrees to keep strictly confidential unless and until any such
event has been publicly announced.

       5.11   Survival of Covenants.  Except for any covenant or agreement
which by its terms expressly terminates as of a specific date, the covenants
and agreements of the parties hereto contained in this Agreement shall survive
the Closing without contractual limitation.






                                      -12-
<PAGE>   13
                                   ARTICLE VI

                    CONDITIONS TO OBLIGATIONS OF THE COMPANY

       The obligations of the Company to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment on or prior
to the Closing Date of each of the following conditions:

       6.1    Representations and Warranties True.  All the representations and
warranties of Buyer contained in this Agreement shall be true and correct on
and as of the Closing Date in all material respects, except to the extent that
any such representation or warranty is made as of a specified date, in which
case such representation or warranty shall have been true and correct as of
such specified date, except to the extent contemplated by this Agreement.

       6.2    Covenants and Agreements Performed.  Buyer shall have performed
and complied with all covenants and agreements required by this Agreement, if
any, to be performed or complied with by it on or prior to the Closing Date in
all material respects.

       6.3    HSR Act.  To the extent that the HSR Act is applicable to the
transaction contemplated herein, all waiting periods (and any extensions
thereof) applicable to this Agreement and the transactions contemplated hereby
under the HSR Act shall have expired or been terminated.

       6.4    Legal Proceedings.  No Proceeding shall, on the Closing Date, be
pending or threatened seeking to restrain, prohibit, or obtain damages or other
relief in connection with this Agreement or the consummation of the
transactions contemplated hereby.

       6.5    Certificate.  The Company shall have received a certificate
executed by a duly authorized person on behalf of Buyer dated the Closing Date,
representing and certifying, in such detail as the Company may reasonably
request, that the conditions set forth in Sections 6.1, 6.2 and 6.4  have been
fulfilled.

       6.6    Satisfaction of Conditions.  All conditions to closing set forth
in the REIT Purchase Agreement have been satisfied or waived.

       6.7    Other Transactions.  All Transactions under the other Transaction
Documents (as defined in the REIT Purchase Agreement) have been consummated
contemporaneously herewith.

                                  ARTICLE VII

                       CONDITIONS TO OBLIGATIONS OF BUYER

       The obligations of Buyer to consummate the transactions contemplated by
this Agreement shall be subject to the fulfillment on or prior to the Closing
Date of each of the following conditions:






                                      -13-
<PAGE>   14
       7.1    Representations and Warranties True.  All the representations and
warranties of the Company contained in this Agreement shall be true and correct
on and as of the Closing Date in all material respects, except to the extent
that any such representation or warranty is made as of a specified date, in
which case such representation or warranty shall have been true and correct as
of such specified date, except to the extent contemplated by this Agreement.

       7.2    Covenants and Agreements Performed.  The Company shall have
performed and complied with all covenants and agreements required by this
Agreement to be performed or complied with by it on or prior to the Closing
Date in all material respects.

       7.3    Legal Proceeding.  No Proceeding shall, on the Closing Date, be
pending or threatened seeking to restrain, prohibit, or obtain damages or other
relief in connection with this Agreement or the consummation of the
transactions contemplated hereby.

       7.4    Certificates.  Buyer shall have received a certificate or
certificates representing the Warrants, in definitive form representing the
Warrants purchased by it, ( in substantially the form set forth in Exhibit A
hereto) registered in the name of Buyer and duly executed by the Company.

       7.5    Satisfaction of Conditions.  All conditions to closing the REIT
Purchase Agreement have been satisfied or waived.

       7.6    Other Transactions.  All Transactions under the other Transaction
Documents (as defined in the REIT Purchase Agreement) have been consummated
contemporaneously herewith.

                                  ARTICLE VIII

                       TERMINATION, AMENDMENT, AND WAIVER

       8.1    Termination.  This Agreement shall be terminated and the
transactions contemplated hereby abandoned if the REIT Purchase Agreement is
terminated.

       8.2    Effect of Termination.  In the event of the termination of this
Agreement pursuant to Section 8.1, this Agreement shall become void and have no
effect, except that the agreements contained in this Section and in Sections
5.1, 5.4 and 5.6 and Article IX shall survive the termination hereof.  Nothing
contained in this Section shall relieve any party from liability for any breach
of this Agreement.

       8.3    Amendment.  This Agreement may not be amended except by an
instrument in writing signed by or on behalf of all the parties hereto.

       8.4    Waiver.  No failure or delay by a party hereto in exercising any
right, power, or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power, or privilege.  The
provisions of this Agreement may not be waived except by an instrument in
writing signed by or on behalf of the party against whom such waiver is sought
to be enforced.






                                      -14-
<PAGE>   15
                                   ARTICLE IX

                  SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION

       9.1    Survival.  The representations and warranties of the parties
hereto contained in this Agreement or in any certificate, instrument or
document delivered pursuant hereto shall survive the Closing, regardless of any
investigation made by or on behalf of any party, until the first anniversary of
the Closing Date (the "Survival Date").  No action may be brought with respect
to a breach of any representation after the Survival Date unless, prior to such
time, the party seeking to bring such an action has notified the other party of
such claim, specifying in reasonable detail the nature of the loss suffered.
The provisions of this Section 9.1 shall have no effect upon any of the
covenants of the parties set forth in Article V or any of the other obligations
of the parties hereto under the Agreement, whether to be performed later, at or
after the Closing.

       9.2    Indemnification by Company.  The Company shall indemnify, defend,
and hold harmless Buyer from and against any and all claims, actions, causes of
action, demands, losses, damages, liabilities, costs, and expenses (including
reasonable attorneys' fees and expenses) (collectively, "Damages"), asserted
against, resulting to, imposed upon, or incurred by Buyer, directly or
indirectly, by reason of or resulting from any breach by the Company of any of
its representations, warranties, covenants, or agreements contained in this
Agreement or in any certificate, instrument, or document delivered pursuant
hereto.  Notwithstanding anything to the contrary contained herein, the
Company's indemnity obligations hereunder (i) will not extend to Damages
arising out of negligence, willful misconduct or fraud of the Buyer, and (ii)
with respect to indemnification claims under this Section 9.2 (other than, for
each of (i) and (ii), Damages related to the ability of the Buyer to exercise
the Warrants, receive the Warrant Shares, effect the registration of the
Warrant Shares or  sell the Warrant Shares), the Company's indemnification
obligations (x) for a period of two (2) years following the Closing, shall not
arise until the aggregate claims resulting from the breach exceed $1,000,000,
at which time such indemnity obligations shall cover all claims, and (y) after
two (2) years following the Closing, shall not arise until the aggregate claims
during such period resulting from the breach exceed $10,000,000, at which time
such indemnity obligations shall cover all claims.

       9.3    Indemnification by Buyer.  Buyer shall indemnify, defend, and
hold harmless the Company from and against any and all Damages asserted
against, resulting to, imposed upon, or incurred by the Company, directly or
indirectly, by reason of or resulting from any breach by Buyer of any of its
representations, warranties, covenants, or agreements contained in this
Agreement or in any certificate, instrument, or document delivered pursuant
hereto.  Notwithstanding anything to the contrary contained herein, Buyer's
indemnity obligations hereunder (i) will not extend to Damages arising out of
negligence, willful misconduct or fraud of the Company, and (ii) with respect
to indemnification claims under this Section 9.3, the Buyer's indemnification
obligations (x) for a period of two (2) years following the Closing, shall not
arise until the aggregate claims resulting from the breach exceed $1,000,000,
at which time such indemnity obligations shall cover all claims, and (y) after
two (2) years following the Closing, shall not






                                      -15-
<PAGE>   16
arise until the aggregate claims during such period resulting from the breach
exceed $10,000,000, at which time such indemnity obligations shall cover all
claims.

       9.4    Procedure for Indemnification.  Promptly after receipt by an
indemnified party under Section 9.2 or 9.3 of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under such Section, give written notice to
the indemnifying party of the commencement thereof, but the failure so to
notify the indemnifying party shall not relieve it of any liability that it may
have to any indemnified party except to the extent the indemnifying party
demonstrates that the defense of such action is prejudiced thereby.  In case
any such action shall be brought against an indemnified party and it shall give
written notice to the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it may wish, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party.  If the indemnifying party elects to
assume the defense of such action, the indemnified party shall have the right
to employ separate counsel at its own expense and to participate in the defense
thereof.  If the indemnifying party elects not to assume (or fails to assume)
the defense of such action, the indemnified party shall be entitled to assume
the defense of such action with counsel of its own choice, at the expense of
the indemnifying party.  If the action is asserted against both the
indemnifying party and the indemnified party and there is a conflict of
interests which renders it inappropriate for the same counsel to represent both
the indemnifying party and the indemnified party, the indemnifying party shall
be responsible for paying for separate counsel for the indemnified party;
provided, however, that if there is more than one indemnified party, the
indemnifying party shall not be responsible for paying for more than one
separate firm of attorneys to represent the indemnified parties, regardless of
the number of indemnified parties.  The indemnifying party shall have no
liability with respect to any compromise or settlement of any action effected
without its written consent (which shall not be unreasonably withheld).

                                   ARTICLE X

                                 MISCELLANEOUS

       10.1   Notices.  All notices, requests, demands, and other
communications required or permitted to be given or made hereunder by any party
hereto shall be in writing and shall be deemed to have been duly given or made
if delivered personally, or transmitted by first class registered or certified
mail, postage prepaid, return receipt requested, or sent by prepaid overnight
delivery service, or sent by cable, telegram, or telefax, to the parties at the
addresses and telefax numbers set forth opposite their names on the signature
page hereof (or at such other addresses and telefax numbers as shall be
specified by the parties by like notice).

       10.2   Entire Agreement.  This Agreement, together with the Transaction
Agreements, constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof.

       10.3   Binding Effect; Assignment; No Third Party Benefit.  This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective legal






                                      -16-
<PAGE>   17
representatives, successors, and permitted assigns.  Except as otherwise
expressly provided in this Agreement, neither this Agreement nor any of the
rights, interests, or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of the other parties.  Except
as provided in Article IX, nothing in this Agreement, express or implied, is
intended to or shall confer upon any person other than the parties hereto, and
their respective legal representatives, successors, and permitted assigns, any
rights, benefits, or remedies of any nature whatsoever under or by reason of
this Agreement.

       10.4   Severability.  If any provision of this Agreement is held to be
unenforceable, this Agreement shall be considered divisible and such provision
shall be deemed inoperative to the extent it is deemed unenforceable, and in
all other respects this Agreement shall remain in full force and effect;
provided however, that if any such provision may be made enforceable by
limitation thereof, then such provision shall be deemed to be so limited and
shall be enforceable to the maximum extent permitted by applicable law.

       10.5   Governing Law.  This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware, without
regard to the principles of conflicts of laws thereof.

       10.6   Counterparts.  This Agreement may be executed by the parties
hereto in any number of counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same agreement.  Each
counterpart may consist of a number of copies hereof each signed by less than
all, but together signed by all, the parties hereto.

                                   ARTICLE XI

                                  DEFINITIONS

       11.1   Certain Defined Terms.  As used in this Agreement, each of the
following terms has the meaning given it in this Article:

              "Affiliate" has the meaning specified in Rule 12b-2 promulgated
       under the Exchange Act.

              "Applicable Law" means any statute, law, rule, or regulation or
       any judgment, order, writ, injunction, or decree of any Governmental
       Entity to which a specified person or property is subject.

              "Business Day" shall mean any day other than a Saturday, a
       Sunday, or a day on which banking institutions in Atlanta, Georgia or
       Dallas, Texas are authorized or obligated by law or executive order to
       close.

              "Encumbrances" means liens, charges, pledges, options, mortgages,
       deeds of trust, security interests, claims, restrictions (whether on
       voting, sale, transfer, disposition, or otherwise), easements, and other
       encumbrances of every type and description, whether imposed by law,
       agreement, understanding, or otherwise.





                                      -17-
<PAGE>   18
              "Equity Ownership Interests" shall mean, with respect to the
       Buyer, at any time, the fraction (a) having as its numerator the number
       of shares of Common Stock and Underlying Warrant Shares held
       beneficially by the Buyer at such time, and (b) having as its
       denominator the aggregate number of shares of Common Stock (calculated
       on a fully diluted basis) issued and outstanding at such time.

              "Equity Securities" means any capital stock of the Company, and
       any securities directly or indirectly convertible into, or exercisable
       or exchangeable for any capital stock of the Company, or any right,
       option, warrant or other security which, with the payment of additional
       consideration, the expiration of time or the occurrence of any event
       shall give the holder thereof the right to acquire any capital stock of
       the company or any security convertible into or exercisable or
       exchangeable for, any capital stock of the Company.

              "Exchange Act" means the Securities Exchange Act of 1934, as
       amended.

              "Governmental Entity" means any court or tribunal in any
       jurisdiction (domestic or foreign) or any public, governmental, or
       regulatory body, agency, department, commission, board, bureau, or other
       authority or instrumentality (domestic or foreign).

              "HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act
       of 1976, as amended.

              "Person" means any individual, corporation, partnership, joint
       venture, association, joint-stock company, trust, enterprise,
       unincorporated organization, or Governmental Entity.

              "Proceedings" means all proceedings, actions, suits,
       investigations, and inquiries by or before any arbitrator or
       Governmental Entity.

              "Registrable Warrant Shares" means the Warrant Shares and any
       Common Stock or other Equity Securities issued with respect thereto by
       way of stock dividend or stock split or in connection with a combination
       of shares, recapitalization, merger, consolidation or other
       reorganization or otherwise.

              "Securities Act" means the Securities Act of 1933, as amended.

              "Subsidiary" means any corporation more than 50% of whose
       outstanding voting securities, or any general partnership, joint
       venture, or similar entity more than 50% of whose total equity
       interests, is owned, directly or indirectly, by the Company, or any
       limited partnership of which the Company or any Subsidiary is a general
       partner.






                                      -18-
<PAGE>   19
              "Underlying Warrant Shares" shall mean, at any time, all shares
       of Common Stock which may be acquired upon exercise of the Warrants.
       For purposes hereof, any person who holds Warrants shall be deemed to be
       the holder of the Underlying Warrant Shares obtainable upon exercise of
       such Warrants.

       11.2   Certain Additional Defined Terms.  In addition to such terms as
are defined in the opening paragraph of and the recitals to this Agreement and
in Section 11.1, the following terms are used in this Agreement as defined in
the Sections set forth opposite such terms:

<TABLE>
<CAPTION>                                                   
        Defined Term                                           Section Reference
        ------------                                           -----------------
        <S>                                                        <C>
        Closing  . . . . . . . . . . . . . . . . . . . . . . . . . Article II
        Closing Date   . . . . . . . . . . . . . . . . . . . . . . Article II
        Damages  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9.2
        Excluded Transfer  . . . . . . . . . . . . . . . . . . . . . . .  5.5
        Material Activity  . . . . . . . . . . . . . . . . . . . . . . .  5.3
        Purchase Price   . . . . . . . . . . . . . . . . . . . . . . . .  1.2
        Registration Expenses  . . . . . . . . . . . . . . . . . . . . .  5.3
        Registration Statement   . . . . . . . . . . . . . . . . . . . .  5.3
        Survival Date  . . . . . . . . . . . . . . . . . . . . . . . . .  9.1
        Warrant Shares   . . . . . . . . . . . . . . . . . . . . . . . .  3.6
        Warrants   . . . . . . . . . . . . . . . . . . . . . . . . . . .  1.1
</TABLE>

       IN WITNESS WHEREOF, the parties have executed this Agreement, or caused
this Agreement to be executed by their duly authorized representatives, all as
of the day and year first above written.


                                        MAGELLAN HEALTH SERVICES, INC.
       Address:
       3414 Peachtree Road, N.E.
       Suite 1400                       By:
       Atlanta, Georgia 30326               -----------------------------------
       Fax: (404) 814-5717                  Name:  Linton C. Newlin      
                                            Title: Vice President and Secretary



                                        CRESCENT OPERATING, INC.



Address:
777 Main Street                         By: 
Fort Worth, Texas 76102                     -----------------------------------
Fax: (817) 878-0429                         Name:  Jeffrey L. Stevens
                                            Title: Chief Financial Officer, 
                                                   Treasurer and Secretary
 





                                      -19-
<PAGE>   20
                                    ANNEX I

<TABLE>
<CAPTION>
                                             Number of Warrant
                         Date First         Shares Issuable Upon      End of Exercise
Warrant [Number]       Exercisable(1)      Exercise of Warrants(1)         Period       
----------------       --------------      -----------------------    ---------------
      <S>              <C>                                              <C>
      [1]              June 17, 1998               3,305               June 17, 2001
                   
      [2]              June 17, 1999               6,865               June 17, 2002
                   
      [3]              June 17, 2000              10,679               June 17, 2003
                   
      [4]              June 17, 2001              14,803               June 17, 2004
                   
      [5]              June 17, 2003              19,239               June 17, 2005
                   
      [6]              June 17, 2003              23,985               June 17, 2006
                   
      [7]              June 17, 2004              29,042               June 17, 2007
                   
      [8]              June 17, 2005              34,494               June 17, 2008
                   
      [9]              June 17, 2006              40,314               June 17, 2009
                   
      [10]             June 17, 2007              46,557               June 17, 2009
                   
      [11]             June 17, 2008              53,225               June 17, 2009
</TABLE>

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

   (1) Notwithstanding anything to the contrary in this Annex I, (i) as to each
numbered Warrant, no exercise shall be allowed until either the Company or
Crescent exercises its corresponding numbered warrant under the Magellan
Warrant and (ii) the number of Warrant Shares issuable upon exercise of each
Warrant shall be limited to the number of Warrant Shares that bears the same
relationship to the number of Warrant Shares listed above for such Warrant as
the number of shares of common stock of Buyer issued to Crescent and the
Company, pursuant to the Magellan Warrant, in connection with the corresponding
numbered warrants, bears to the number of shares of Common Stock of Buyer
issuable under such numbered warrants.






                                      -20-