<PAGE>
                                                                     EXHIBIT 4.2

                                 FORM OF WARRANT


THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B)
AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD
PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES. ANY TRANSFEREE OF THIS
WARRANT SHOULD CAREFULLY REVIEW THE TERMS OF THIS WARRANT, INCLUDING SECTION
2(f) HEREOF. THE SECURITIES REPRESENTED BY THIS WARRANT MAY BE LESS THAN THE
NUMBER SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 2(f) HEREOF.


                                 ZIX CORPORATION

                        WARRANT TO PURCHASE COMMON STOCK

Warrant No.:                                    Number of Shares:
             -------------------------------                      -------------

Date of Issuance:             , 2003
                  -----------


Zix Corporation, a Texas corporation (the "COMPANY"), hereby certifies that, for
Ten United States Dollars ($10.00) and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
____________________, the registered holder hereof or its permitted assigns, is
entitled, subject to the terms set forth below, to purchase from the Company
upon surrender of this Warrant (if required by Section 2(f)), at any time or
times on or after the date hereof, but not after 11:59 P.M. New York Time on the
Expiration Date (as defined herein),_________________ ( ____ ) [INSERT THE
NUMBER OF REPLACEMENT WARRANT SHARES DETERMINED PURSUANT TO SECTION 1(b) OF THE
AGREEMENT REGARDING EXERCISE AND ISSUANCE OF WARRANTS] fully paid nonassessable
shares of Common Stock (as defined herein) of the Company (the "WARRANT SHARES")
at the purchase price per share provided in Section 1(b) below; provided,
however, that in no event shall the holder be entitled to exercise this Warrant
for a number of Warrant Shares in excess of that number of Warrant Shares that,
upon giving effect to such exercise, would cause the aggregate number of shares
of Common Stock beneficially owned by the holder and its affiliates to exceed
4.99% of the outstanding shares of the Common Stock following such exercise. For
purposes of the foregoing proviso, the aggregate number of shares of Common
Stock beneficially owned by the holder and its affiliates shall include the
number of shares of Common Stock issuable upon exercise of this Warrant with
respect to which the determination of such proviso is being made, but shall
exclude shares of Common Stock that would be issuable upon (i) exercise of the
remaining, unexercised Warrants



<PAGE>

beneficially owned by the holder and its affiliates and (ii) exercise,
conversion or exchange of the unexercised, unconverted or unexchanged portion of
any other securities of the Company beneficially owned by the holder and its
affiliates (including, without limitation, any convertible notes or preferred
stock) subject to a limitation on conversion, exercise or exchange analogous to
the limitation contained herein. Except as set forth in the preceding sentence,
for purposes of this paragraph, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended. For purposes of this Warrant, in determining the number of outstanding
shares of Common Stock a holder may rely on the number of outstanding shares of
Common Stock as reflected in (1) the Company's most recent Form 10-Q or Form
10-K, as the case may be, (2) a more recent public announcement by the Company
or (3) any other notice by the Company or its transfer agent setting forth the
number of shares of Common Stock outstanding. Upon the written request of any
holder, the Company shall promptly, but in no event later than two (2) Business
Days following the receipt of such notice, confirm in writing to any such holder
the number of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to
the conversion, exercise or exchange of securities of the Company, including the
Replacement Warrants (as defined below) and the Initial Warrants (as defined in
the Warrant Agreement (as defined below)), since the date as of which such
number of outstanding shares of Common Stock was reported.

         Section 1.

                  (a) Agreement. This Warrant is one of the warrants (the
"REPLACEMENT WARRANTS") issued pursuant to Section 1 of that certain Agreement
Regarding Exercise and Issuance of Warrants dated as of March 3, 2003, among
the Company and the Persons (as defined below) referred to therein (as such
agreement may be amended from time to time as provided in such agreement, the
"WARRANT AGREEMENT").

                  (b) Definitions. The following words and terms as used in this
Warrant shall have the following meanings:

         (i) "APPROVED STOCK PLAN" means any employee benefit plan that has been
         approved by the Board of Directors of the Company prior to September
         17, 2002, pursuant to which the Company's securities may be issued to
         any consultant, employee, officer or director for services provided to
         the Company.

         (ii) "BUSINESS DAY" means any day other than Saturday, Sunday or other
         day on which commercial banks in the City of New York are authorized or
         required by law to remain closed.

         (iii) "COMMON STOCK" means (i) the Company's common stock, $0.01 par
         value per share, and (ii) any capital stock into which such Common
         Stock shall have been changed or any capital stock resulting from a
         reclassification of such Common Stock.

         (iv) "CONVERTIBLE SECURITIES" means any stock or securities (other than
         Options) directly or indirectly convertible into or exchangeable or
         exercisable for Common Stock.

         (v) "EXPIRATION DATE" means September 18, 2005 or, if such date does
         not fall on a Business Day or on a day on which trading takes place on
         the Principal Market, then the next Business Day.



                                      -2-
<PAGE>
         (vi) "FUTURE APPROVED STOCK PLAN" means any employee benefit plan that
         has been approved by the shareholders of the Company after September
         17, 2002, pursuant to which the Company's securities may be issued to
         any consultant, employee, officer or director for services provided to
         the Company.

         (vii) "OPTIONS" means any rights, warrants or options to subscribe for
         or purchase Common Stock or Convertible Securities.

         (viii) "PERSON" means an individual, a limited liability company, a
         partnership, a joint venture, a corporation, a trust, an unincorporated
         organization and a government or any department or agency thereof or
         any other legal entity.

         (ix) "PRINCIPAL MARKET" means, with respect to the Common Stock or any
         other security, the Nasdaq National Market, or, if the Common Stock or
         any other security is not traded on the Nasdaq National Market, then
         the principal securities exchange or trading market for the Common
         Stock or such other security.

         (x) "REGISTRATION RIGHTS AGREEMENT" means that agreement dated March
         3, 2003 by and among the Company and the Persons referred to therein,
         as such agreement may be amended from time to time as provided in such
         agreement.

         (xi) "SECURITIES ACT" means the Securities Act of 1933, as amended.

         (xii) "SECURITIES PURCHASE AGREEMENT" means the securities purchase
         agreement, dated as of September 17, 2002, among the Company and the
         buyers named therein relating to the purchase of secured convertible
         notes and warrants of the Company.

         (xiii) "WARRANT" means this Warrant and all Warrants issued in
         exchange, transfer or replacement thereof pursuant to the terms of such
         Warrants.

         (xiv) "WARRANT EXERCISE PRICE" shall be equal to, with respect to any
         Warrant Share, $______ [INSERT THE EXERCISE PRICE (AS DEFINED IN THE
         WARRANT AGREEMENT) AS OF THE WARRANT DATE], subject to adjustment as
         hereinafter provided.

         (xv) "WEIGHTED AVERAGE PRICE" means, for any security as of any date,
         the dollar volume-weighted average price for such security on the
         Principal Market during the period beginning at 9:30 a.m., New York
         City Time (or such other time as the Principal Market publicly
         announces is the official open of trading), and ending at 4:00 p.m.,
         New York City Time (or such other time as the Principal Market publicly
         announces is the official close of trading), as reported by Bloomberg
         Financial Markets ("BLOOMBERG") through its "Volume at Price" functions
         (ignoring any trade of more than 30,000 shares of such security
         pursuant to an individual transaction (subject to adjustment for stock
         splits, stock dividends, stock combinations and other similar
         transactions involving such security after the Warrant Date)), or, if
         the foregoing does not apply, the dollar volume-weighted average price
         of such security in the over-the-counter market on the electronic
         bulletin board for such security during the period beginning at 9:30
         a.m., New York City Time (or such other time as the Principal Market
         publicly announces is the official open of trading), and ending at 4:00
         p.m., New York City Time (or such other time as the Principal Market
         publicly announces is the official close of trading), as reported by



                                      -3-
<PAGE>

         Bloomberg, or, if no dollar volume-weighted average price is reported
         for such security by Bloomberg for such hours, the average of the
         highest closing bid price and the lowest closing ask price of any of
         the market makers for such security as reported in the "pink sheets" by
         the National Quotation Bureau, Inc. If the Weighted Average Price
         cannot be calculated for such security on such date on any of the
         foregoing bases, the Weighted Average Price of such security on such
         date shall be the fair market value as mutually determined by the
         Company and the holders of the Replacement Warrants representing at
         least two-thirds of the shares of Common Stock issuable upon exercise
         of the Replacement Warrants then outstanding. If the Company and the
         holders of the Replacement Warrants representing at least two-thirds of
         the shares of Common Stock issuable upon exercise of the Replacement
         Warrants then outstanding are unable to agree upon the fair market
         value of the Common Stock, then such dispute shall be resolved pursuant
         to Section 2(a) below. All such determinations to be appropriately
         adjusted for any stock dividend, stock split, stock combination or
         other similar transaction during any period during which the Weighted
         Average Price is being determined.

         Section 2. Exercise of Warrant.

                  (a) Subject to the terms and conditions hereof, this Warrant
may be exercised by the holder hereof then registered on the books of the
Company, in whole or in part, at any time on any Business Day on or after the
opening of business on the date hereof and prior to 11:59 P.M. New York Time on
the Expiration Date by (i) delivery of a written notice, in the form of the
subscription form attached as Exhibit A hereto (the "EXERCISE NOTICE"), of such
holder's election to exercise this Warrant, which notice shall specify the
number of Warrant Shares to be purchased, (ii) (A) payment to the Company of an
amount equal to the Warrant Exercise Price multiplied by the number of Warrant
Shares as to which this Warrant is being exercised (the "AGGREGATE EXERCISE
PRICE") by wire transfer of immediately available funds (or by check if the
Company has not provided the holder of this Warrant with wire transfer
instructions for such payment) or (B) by notifying the Company that this Warrant
is being exercised pursuant to a Cashless Exercise (as defined in Section 2(e)),
and (iii) if required by Section 2(f) or unless the Holder has previously
delivered this Warrant to the Company and it or a new replacement Warrant has
not yet been delivered to the Holder, the surrender to a common carrier for
overnight delivery to the Company as soon as practicable following such date,
this Warrant (or an indemnification undertaking with respect to this Warrant in
the case of its loss, theft or destruction); provided, that if such Warrant
Shares are to be issued in any name other than that of the registered holder of
this Warrant, such issuance shall be deemed a transfer and the provisions of
Section 7 shall be applicable. In the event of any exercise of the rights
represented by this Warrant in compliance with this Section 2(a), the Company
shall on the second (2nd) Business Day (the "WARRANT SHARE DELIVERY DATE")
following the date of its receipt of the Exercise Notice, the Aggregate Exercise
Price (or notice of Cashless Exercise) and if required by Section 2(f) (or
unless the Holder has previously delivered this Warrant to the Company and it or
a new replacement Warrant has not yet been delivered to the Holder), this
Warrant (or an indemnification undertaking with respect to this Warrant in the
case of its loss, theft or destruction) (the "EXERCISE DELIVERY DOCUMENTS") (A)
provided that the transfer agent is participating in The Depository Trust
Company ("DTC") Fast Automated Securities Transfer Program and provided that the
holder is eligible to receive shares through DTC, credit such aggregate number
of shares of Common Stock to which the holder shall be entitled to the holder's
or its designee's balance account with DTC through its Deposit Withdrawal Agent
Commission system or (B) issue and deliver to the address specified in the
Exercise Notice, a certificate, registered in the name of the holder or its
designee, for the number of shares of




                                      -4-
<PAGE>

Common Stock to which the holder shall be entitled. Upon (x) delivery of the
Exercise Notice and (y) the Aggregate Exercise Price referred to in clause
(ii)(A) above or notification to the Company of a Cashless Exercise referred to
in Section 2(e), the holder of this Warrant shall be deemed for all corporate
purposes to have become the holder of record of the Warrant Shares with respect
to which this Warrant has been exercised, irrespective of the date of delivery
of this Warrant as required by clause (iii) above or the certificates evidencing
such Warrant Shares. In the case of a dispute as to the determination of the
Warrant Exercise Price, the Weighted Average Price of a security or the
arithmetic calculation of the number of Warrant Shares, the Company shall
promptly issue to the holder the number of shares of Common Stock that is not
disputed and shall submit the disputed determinations or arithmetic calculations
to the holder via facsimile within one (1) Business Day of receipt of the
holder's Exercise Notice. If the holder and the Company are unable to agree upon
the determination of the Warrant Exercise Price, the Weighted Average Price or
arithmetic calculation of the number of Warrant Shares within one (1) Business
Day of such disputed determination or arithmetic calculation being submitted to
the holder, then the Company shall within two (2) Business Days submit via
facsimile (i) the disputed determination of the Warrant Exercise Price or the
Weighted Average Price to an independent, reputable investment banking firm
selected from the list of such investment banks agreed to by the Company and the
original holders of the Replacement Warrants in connection with the securities
issued pursuant to the Securities Purchase Agreement (the "AGREED UPON LIST") or
(ii) the disputed arithmetic calculation of the number of Warrant Shares to its
independent, outside accountant. The Company shall cause the investment banking
firm or the accountant, as the case may be, to perform the determinations or
calculations and notify the Company and the holder of the results no later than
three (3) Business Days from the time it receives the disputed determinations or
calculations. Such investment banking firm's or accountant's determination or
calculation, as the case may be, shall be deemed conclusive absent error.

                  (b) If this Warrant is submitted for exercise, as may be
required by Section 2(f), and unless the rights represented by this Warrant
shall have expired or shall have been fully exercised, the Company shall, as
soon as practicable and in no event later than three (3) Business Days after
receipt of this Warrant (the "WARRANT DELIVERY DATE") and at its own expense,
issue a new Warrant identical in all respects to this Warrant exercised except
it shall represent rights to purchase the number of Warrant Shares purchasable
immediately prior to such exercise under this Warrant, less the number of
Warrant Shares with respect to which such Warrant is exercised.

                  (c) No fractional shares of Common Stock are to be issued upon
the exercise of this Warrant, but rather the number of shares of Common Stock
issued upon exercise of this Warrant shall be rounded up or down to the nearest
whole number.

                  (d) If the Company shall fail for any reason or for no reason
(x) to issue and deliver to the holder within three (3) Business Days of receipt
of the Exercise Delivery Documents a certificate for the number of shares of
Common Stock to which the holder is entitled or to credit the holder's balance
account with DTC for such number of shares of Common Stock to which the holder
is entitled upon the holder's exercise of this Warrant or (y) to issue and
deliver to the holder on the Warrant Delivery Date a new Warrant for the number
of shares of Common Stock to which such holder is entitled pursuant to Section
2(b) hereof, if any, then the Company shall, in addition to any other remedies
under this Warrant or the Warrant Agreement or otherwise available to such
holder, including any indemnification under Section 8 of the Warrant Agreement,
pay as additional damages in cash to such holder on each day after such third
(3rd) Business Day that such shares of Common Stock are not issued and delivered
to




                                      -5-
<PAGE>

the holder, in the case of clause (x) above, or such third (3rd) Business Day
that such Warrant is not delivered, in the case of clause (y) above, in an
amount equal to the sum of (i) 0.5% of the product of (A) the number of shares
of Common Stock not issued to the holder on or prior to the Warrant Share
Delivery Date and (B) the Weighted Average Price of the Common Stock on the
Warrant Share Delivery Date, in the case of the failure to deliver Common Stock,
and (ii) if the Company has failed to deliver a Warrant to the holder on or
prior to the Warrant Delivery Date, 0.1% of the product of (x) the number of
shares of Common Stock issuable upon exercise of the Warrant as of the Warrant
Delivery Date, and (y) the Weighted Average Price of the Common Stock on the
Warrant Delivery Date; provided that in no event shall cash damages accrue
pursuant to this Section 2(d) during the period, if any, in which any Warrant
Shares are the subject of a bona fide dispute that is subject to and being
resolved pursuant to, and in compliance with the time periods and other
provisions of, the dispute resolution provisions of Section 2(a). Alternatively,
subject to the dispute resolution provisions of Section 2(a), at the election of
the holder made in the holder's sole discretion, the Company shall pay to the
holder, in lieu of the additional damages referred to in the preceding sentence
(but in addition to all other available remedies that the holder may pursue
hereunder and under the Warrant Agreement (including indemnification pursuant to
Section 8 thereof)), 110% of the amount by which (A) the holder's total purchase
price (including brokerage commissions, if any) for shares of Common Stock
purchased to make delivery in satisfaction of a sale by such holder of the
shares of Common Stock to which the holder is entitled but has not received upon
an exercise, exceeds (B) the net proceeds received by the holder from the sale
of the shares of Common Stock to which the holder is entitled but has not
received upon such exercise.

                  (e) If, despite the Company's obligations under the Warrant
Agreement and the Registration Rights Agreement, the Warrant Shares to be issued
are not registered and available for resale pursuant to a registration statement
in accordance with the Registration Rights Agreement, including during a Grace
Period (as defined in the Registration Rights Agreement), then notwithstanding
anything contained herein to the contrary, the holder of this Warrant may, at
its election exercised in its sole discretion, exercise this Warrant in whole or
in part and, in lieu of making the cash payment otherwise contemplated to be
made to the Company upon such exercise in payment of the Aggregate Exercise
Price, elect instead to receive upon such exercise the "Net Number" of shares of
Common Stock determined according to the following formula (a "CASHLESS
EXERCISE"):

         Net Number = (A x B) - (A x C)
                      -----------------
                              B
                  For purposes of the foregoing formula:

                           A= the total number of shares with respect to which
                           this Warrant is then being exercised.

                           B= the Weighted Average Price of the Common Stock on
                           the trading day immediately preceding the date of the
                           delivery of the Exercise Notice.

                           C= the Warrant Exercise Price then in effect for the
                           applicable Warrant Shares at the time of such
                           exercise.

                  (f) Book-Entry. Notwithstanding anything to the contrary set
forth herein,




                                      -6-
<PAGE>

upon exercise of this Warrant in accordance with the terms hereof, the Holder
shall not be required to physically surrender this Warrant to the Company unless
it is being exercised for all of the Warrant Shares represented by the Warrant.
The Holder and the Company shall maintain records showing the number of Warrant
Shares exercised and issued and the dates of such exercises or shall use such
other method, reasonably satisfactory to the Holder and the Company, so as not
to require physical surrender of this Warrant upon each such exercise. In the
event of any dispute or discrepancy, such records of the Company establishing
the number of Warrant Shares to which the Holder is entitled shall be
controlling and determinative in the absence of error. Notwithstanding the
foregoing, if this Warrant is exercised as aforesaid, the Holder may not
transfer this Warrant unless the Holder first physically surrenders this Warrant
to the Company, whereupon the Company will forthwith issue and deliver upon the
order of the Holder a new Warrant of like tenor, registered as the Holder may
request, representing in the aggregate the remaining number of Warrant Shares
represented by this Warrant. The Holder and any assignee, by acceptance of this
Warrant, acknowledge and agree that, by reason of the provisions of this
paragraph, following exercises of any portion of this Warrant, the number of
Warrant Shares represented by this Warrant may be less than the number stated on
the face hereof. Each Warrant shall bear the following legend:


                  ANY TRANSFEREE OF THIS WARRANT SHOULD CAREFULLY REVIEW THE
                  TERMS OF THIS WARRANT, INCLUDING SECTION 2(f) HEREOF. THE
                  SECURITIES REPRESENTED BY THIS WARRANT MAY BE LESS THAN THE
                  NUMBER SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 2(f)
                  HEREOF.

         Section 3. Covenants as to Common Stock. The Company hereby covenants
and agrees as follows:

                  (a) This Warrant is, and any Warrants issued in substitution
for or replacement of this Warrant will upon issuance be, duly authorized and
validly issued.

                  (b) All Warrant Shares that may be issued upon the exercise of
the rights represented by this Warrant will, upon issuance, be validly issued,
fully paid and nonassessable and free from all taxes, liens and charges with
respect to the issue thereof.

                  (c) During the period within which the rights represented by
this Warrant may be exercised, the Company will at all times have authorized and
reserved at least 110% of the number of shares of Common Stock needed to provide
for the exercise of the rights then represented by this Warrant.

                  (d) The Company shall promptly secure the listing of the
shares of Common Stock issuable upon exercise of this Warrant on the Principal
Market (subject to official notice of issuance upon exercise of this Warrant)
and shall maintain, so long as any other shares of Common Stock shall be so
listed, such listing of all shares of Common Stock from time to time issuable
upon the exercise of this Warrant; and the Company shall so list on the
Principal Market and shall maintain such listing of, any other shares of capital
stock of the Company issuable upon the exercise of this Warrant if and so long
as any shares of the same class shall be listed on such Principal Market.


                                      -7-
<PAGE>

                  (e) The Company will not, by amendment of its Restated
Articles of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities, or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed by it hereunder, but will at all times in
good faith assist in the carrying out of all the provisions of this Warrant and
in the taking of all such action as may reasonably be requested by the holder of
this Warrant in order to protect the exercise privilege of the holder of this
Warrant against dilution or other impairment, consistent with the tenor and
purpose of this Warrant. Without limiting the generality of the foregoing, the
Company (i) will not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above $0.01 per share, and (ii)
will take all such actions as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant.

                  (f) This Warrant will be binding upon any entity succeeding to
the Company by merger, consolidation or acquisition of all or substantially all
of the Company's assets.

         Section 4. Taxes. The Company shall pay any and all taxes that may be
payable with respect to the issuance and delivery of Warrant Shares upon
exercise of this Warrant; provided, however, that the holder of this warrant
shall pay any taxes in connection with any transfers of this warrant or the
transfer of the Warrant Shares issuable upon exercise hereof.

         Section 5. Warrant Holder Not Deemed a Stockholder. No holder, as such,
of this Warrant shall be entitled to vote or receive dividends or be deemed the
holder of shares of the Company for any purpose (other than to the extent that
the holder is deemed to be a beneficial holder of shares under applicable
securities laws after taking into account the limitation set forth in the first
paragraph of this Warrant), nor shall anything contained in this Warrant be
construed to confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote, give or withhold consent to any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to the
issuance to the holder of this Warrant of the Warrant Shares that he or she is
then entitled to receive upon the due exercise of this Warrant. In addition,
nothing contained in this Warrant shall be construed as imposing any liabilities
on such holder to purchase any securities (upon exercise of this Warrant or
otherwise) or as a stockholder of the Company, whether such liabilities are
asserted by the Company or by creditors of the Company. Notwithstanding this
Section 5, the Company will provide the holder of this Warrant with copies of
the same notices and other information given to the stockholders of the Company
generally, contemporaneously with the giving thereof to the stockholders.

         Section 6. Representations of Holder. The holder of this Warrant, by
the acceptance hereof, represents that it is acquiring this Warrant, and upon
exercise hereof (other than pursuant to a Cashless Exercise) will acquire the
Warrant Shares, for its own account and not with a view towards, or for resale
in connection with, the public sale or distribution of this Warrant or the
Warrant Shares, except pursuant to sales registered or exempted under the
Securities Act; provided, however, that by making the representations herein,
the holder does not agree to hold this Warrant or any of the Warrant Shares for
any minimum or other specific term and reserves the right to dispose of this
Warrant and the Warrant Shares at any time in accordance with or pursuant to a
registration statement or an exemption under the Securities Act. The holder of
this Warrant further represents, by acceptance hereof, that, as of this date,
such holder is an




                                      -8-
<PAGE>

"accredited investor" as such term is defined in Rule 501(a)(3) of Regulation D
promulgated by the Securities and Exchange Commission under the Securities Act
(an "ACCREDITED INVESTOR"). Each delivery of an Exercise Notice, other than in
connection with a Cashless Exercise, shall constitute confirmation at such time
by the holder of the representations concerning the Warrant Shares set forth in
the first two sentences of this Section 6, unless contemporaneous with the
delivery of such Exercise Notice the holder notifies the Company in writing that
it is not making such representations (a "REPRESENTATION NOTICE"). If the holder
delivers a Representation Notice in connection with an exercise, it shall be a
condition to such holder's exercise of this Warrant and the Company's
obligations set forth in Section 2 in connection with such exercise, that the
Company receive such other representations as the Company considers reasonably
necessary to assure the Company that the issuance of its securities upon
exercise of this Warrant shall not violate any United States or state securities
laws.

         Section 7. Ownership and Transfer.

                  (a) The Company shall maintain at its principal executive
offices (or such other office or agency of the Company as it may designate by
notice to the holder hereof), a register for this Warrant, in which the Company
shall record the name and address of the person in whose name this Warrant has
been issued, as well as the name and address of each transferee. The Company may
treat the person in whose name any Warrant is registered on the register as the
owner and holder thereof for all purposes, notwithstanding any notice to the
contrary, but in all events recognizing any transfers made in accordance with
the terms of this Warrant.

                  (b) This Warrant and the rights granted hereunder shall be
assignable by the holder hereof without the consent of the Company.

                  (c) The Company is obligated to register the Warrant Shares
for resale under the Securities Act pursuant to the Registration Rights
Agreement and the initial holder of this Warrant (and certain assignees thereof)
is entitled to the registration rights in respect of the Warrant Shares as set
forth in the Registration Rights Agreement.

                  (d) This Warrant and the shares issuable upon exercise of this
Warrant (collectively the "SECURITIES") have not been registered under the
Securities Act or applicable state securities laws and may not be offered for
sale, sold, assigned or transferred unless (A) subsequently registered
thereunder, (B) such Buyer shall have delivered to the Company an opinion of
counsel, in a generally acceptable form, to the effect that such Securities to
be sold, assigned or transferred may be sold, assigned or transferred pursuant
to an exemption from such registration, or (C) such Holder provides the Company
with reasonable assurance that such Securities can be sold, assigned or
transferred pursuant to Rule 144 promulgated under the Securities Act, as
amended (or a successor rule thereto) ("RULE 144"). Any sale of the Securities
made in reliance on Rule 144 may be made only in accordance with the terms of
Rule 144 and further, if Rule 144 is not applicable, any resale of the
Securities under circumstances in which the seller (or the person through whom
the sale is made) may be deemed to be an underwriter (as that term is defined in
the Securities Act) may require compliance with some other exemption under the
Securities Act or the rules and regulations of the SEC thereunder. Neither the
Company nor any other person is under any obligation to register the Securities
under the Securities Act or any state securities laws or to comply with the
terms and conditions of any exemption thereunder. Notwithstanding the foregoing,
the Securities may be pledged in connection with a bona fide margin account or
other loan or financing arrangement secured by the Securities.

                                      -9-
<PAGE>

         Section 8. Adjustment of Warrant Exercise Price and Number of Shares.
The Warrant Exercise Price and the number of shares of Common Stock issuable
upon exercise of this Warrant shall be adjusted from time to time as follows:

                  (a) Adjustment of Warrant Exercise Price and Number of Shares
upon Issuance of Common Stock. If and whenever on or after the Warrant Date, the
Company issues or sells, or is deemed to have issued or sold, any shares of
Common Stock (including the issuance or sale of shares of Common Stock owned or
held by or for the account of the Company, but excluding Exempted Issuances (as
defined below)) for a consideration per share less than a price (the "APPLICABLE
PRICE") equal to the Warrant Exercise Price in effect immediately prior to such
issuance or sale, then immediately after such issue or sale the Warrant Exercise
Price then in effect shall be reduced to an amount equal to such consideration
per share. Upon each such adjustment of the Warrant Exercise Price pursuant to
the immediately preceding sentence, the number of shares of Common Stock
acquirable upon exercise of this Warrant shall be adjusted to the number of
shares determined by multiplying the Warrant Exercise Price in effect
immediately prior to such adjustment by the number of shares of Common Stock
acquirable upon exercise of this Warrant immediately prior to such adjustment
and dividing the product thereof by the Warrant Exercise Price resulting from
such adjustment. For purposes of this Warrant, "EXEMPTED ISSUANCES" shall mean:
(I) shares of Common Stock issued or deemed to have been issued by the Company
in connection with an Approved Stock Plan and up to 4,000,000 shares (subject to
adjustment for stock splits, stock dividends, stock combinations and other
similar transactions after September 18, 2002) issued after September 18, 2002
in connection with a Future Approved Stock Plan; (II) shares of Common Stock
issued or deemed issued upon the conversion, exchange or exercise of any right,
option, obligation or security outstanding on the date prior to the Warrant Date
and set forth in Schedule 3(c) of the Securities Purchase Agreement, provided
that the terms of such option, obligation or security are not amended on or
after the Warrant Date, (III) shares of Common Stock deemed to have been issued
upon the issuance of the Company's Series A Convertible Preferred Stock or
Series B Convertible Preferred Stock and the warrants issued in connection
therewith, so long as the number and terms of such Series A and Series B
Convertible Preferred Stock and the terms of such warrants are not amended or
otherwise altered on or after September 18, 2002; (IV) shares of Common Stock
issued by the Company upon conversion of its Series A Convertible Preferred
Stock or Series B Convertible Preferred Stock, and shares of Common Stock issued
by the Company upon exercise of the warrants issued in connection with the
issuance of the Series A Convertible Preferred Stock and Series B Convertible
Preferred Stock, so long as the number and terms of such Series A and Series B
Convertible Preferred Stock and the terms of such warrants have not been amended
or otherwise altered on or after September 18, 2002; (V) shares of Common Stock
issued or deemed to have been issued by the Company upon exercise of the
Replacement Warrants or the Initial Warrants; (VI) shares of Common Stock issued
or deemed to have been issued either (x) to parties that are suppliers,
customers or strategic partners investing in connection with a commercial
relationship with the Company, the primary purpose of which is not to raise
capital, or (y) as consideration for mergers or consolidations or acquisitions
of businesses or their tangible or intangible assets (each an "ACQUISITION
TRANSACTION"), excluding Acquisition Transactions in which cash or cash
equivalents represent a majority of the assets acquired; provided that such
issuances or deemed issuances pursuant to this clause (VI) and the corresponding
clause (VI) in the Initial Warrants shall not exceed 400,000 shares of Common
Stock in the aggregate after September 18, 2002 (subject to adjustment for stock
splits, stock dividends, stock combinations or other similar transactions after
September 18, 2002); (VII) shares of Common Stock issued or deemed to have been
issued


                                      -10-
<PAGE>

in connection with leases; and (VIII) shares of Common Stock issued or
deemed to have been issued to former employees in satisfaction of severance
obligations of the Company.

                  (b) Effect on Warrant Exercise Price of Certain Events. For
purposes of determining the adjusted Warrant Exercise Price under Section 8(a)
above, the following shall be applicable:

         (i) Issuance of Options. If the Company in any manner grants or sells
         any Options and the lowest price per share for which one share of
         Common Stock is issuable upon the exercise of any such Option or upon
         conversion, exchange or exercise of any Convertible Securities issuable
         upon exercise of any such Option is less than the Applicable Price,
         then such share of Common Stock shall be deemed to be outstanding and
         to have been issued and sold by the Company at the time of the granting
         or sale of such Option for such price per share. For purposes of this
         Section 8(b)(i), the "lowest price per share for which one share of
         Common Stock is issuable upon exercise of any such Option or upon
         conversion, exchange or exercise of any Convertible Security issuable
         upon exercise of any such Option" shall be equal to the sum of the
         lowest amounts of consideration (if any) received or receivable by the
         Company with respect to any one share of Common Stock upon the granting
         or sale of the Option, upon exercise of the Option and upon conversion,
         exchange or exercise of any Convertible Security issuable upon exercise
         of such Option. No further adjustment of the Warrant Exercise Price
         shall be made upon the actual issuance of such Common Stock or of such
         Convertible Securities upon the exercise of such Options or upon the
         actual issuance of such Common Stock upon conversion, exchange or
         exercise of such Convertible Securities.

         (ii) Issuance of Convertible Securities. If the Company in any manner
         issues or sells any Convertible Securities and the lowest price per
         share for which one share of Common Stock is issuable upon such
         conversion, exchange or exercise thereof is less than the Applicable
         Price, then such share of Common Stock shall be deemed to be
         outstanding and to have been issued and sold by the Company at the time
         of the issuance or sale of such Convertible Securities for such price
         per share. For the purposes of this Section 8(b)(ii), the "lowest price
         per share for which one share of Common Stock is issuable upon such
         conversion, exchange or exercise" shall be equal to the sum of the
         lowest amounts of consideration (if any) received or receivable by the
         Company with respect to one share of Common Stock upon the issuance or
         sale of the Convertible Security and upon conversion, exchange or
         exercise of such Convertible Security. No further adjustment of the
         Warrant Exercise Price shall be made upon the actual issuance of such
         Common Stock upon conversion, exchange or exercise of such Convertible
         Securities, and if any such issue or sale of such Convertible
         Securities is made upon exercise of any Options for which adjustment of
         the Warrant Exercise Price had been or are to be made pursuant to other
         provisions of this Section 8(b), no further adjustment of the Warrant
         Exercise Price shall be made by reason of such issue or sale.

         (iii) Change in Option Price or Rate of Conversion. If the purchase,
         exchange or exercise price provided for in any Options, the additional
         consideration, if any, payable upon the issue, conversion, exchange or
         exercise of any Convertible Securities, or the rate at which any
         Options or Convertible Securities are convertible into or exchangeable
         or exercisable for Common Stock changes at any time, the Warrant
         Exercise Price in effect at the time of such change shall be adjusted
         to the Warrant Exercise Price that would have been in effect at such
         time had such Options or Convertible Securities provided for



                                      -11-
<PAGE>

         such changed purchase, exchange or exercise price, additional
         consideration or changed conversion rate, as the case may be, at the
         time initially granted, issued or sold and the number of shares of
         Common Stock acquirable hereunder shall be correspondingly readjusted.
         For purposes of this Section 8(b)(iii), if the terms of any Option or
         Convertible Security that was outstanding as of the date of issuance of
         this Warrant are changed in the manner described in the immediately
         preceding sentence, then such Option or Convertible Security and the
         Common Stock deemed issuable upon exercise, conversion or exchange
         thereof shall be deemed to have been issued as of the date of such
         change. No adjustment shall be made if such adjustment would result in
         an increase of the Warrant Exercise Price then in effect.

                  (c) Effect on Warrant Exercise Price of Certain Events. For
purposes of determining the adjusted Warrant Exercise Price under Sections 8(a)
and 8(b), the following shall be applicable:

         (i) Calculation of Consideration Received. In case any Option is issued
         in connection with the issue or sale of other securities of the
         Company, together comprising one integrated transaction in which no
         specific consideration is allocated to such Options by the parties
         thereto, the Options will be deemed to have been issued for a
         consideration of $.01. If any Common Stock, Options or Convertible
         Securities are issued or sold or deemed to have been issued or sold for
         cash, the consideration received therefor will be deemed to be the net
         amount received by the Company therefor. If any Common Stock, Options
         or Convertible Securities are issued or sold for a consideration other
         than cash, the amount of such consideration received by the Company
         will be the fair value of such consideration, except where such
         consideration consists of marketable securities, in which case the
         amount of consideration received by the Company will be the Weighted
         Average Price of such securities on the date of receipt of such
         securities. If any Common Stock, Options or Convertible Securities are
         issued to the owners of the non-surviving entity in connection with any
         merger in which the Company is the surviving entity, the amount of
         consideration therefor will be deemed to be the fair value of such
         portion of the net assets and business of the non-surviving entity as
         is attributable to such Common Stock, Options or Convertible
         Securities, as the case may be. The fair value of any consideration
         other than cash or securities will be determined jointly by the Company
         and the holders of Replacement Warrants representing at least
         two-thirds of the shares of Common Stock obtainable upon exercise of
         the Replacement Warrants then outstanding. If such parties are unable
         to reach agreement within ten (10) days after the occurrence of an
         event requiring valuation (the "VALUATION EVENT"), the fair value of
         such consideration will be determined within five (5) Business Days
         after the tenth (10th) day following the Valuation Event by an
         independent, reputable appraiser jointly selected by the Company and
         the holders of Replacement Warrants representing at least two-thirds of
         the shares of Common Stock obtainable upon exercise of the Replacement
         Warrants then outstanding. The determination of such appraiser shall be
         final and binding upon all parties absent error and the fees and
         expenses of such appraiser shall be borne by the Company.

         (ii) Record Date. If the Company takes a record of the holders of
         Common Stock for the purpose of entitling them (1) to receive a
         dividend or other distribution payable in Common Stock, Options or in
         Convertible Securities or (2) to subscribe for or purchase Common
         Stock, Options or Convertible Securities, then such record date will be
         deemed to be the date of the issue or sale of the shares of Common
         Stock deemed to have been



                                      -12-
<PAGE>
         issued or sold upon the declaration of such dividend or the making of
         such other distribution or the date of the granting of such right of
         subscription or purchase, as the case may be.

                  (d) Adjustment of Warrant Exercise Price upon Subdivision or
Combination of Common Stock. If the Company at any time after the date of
issuance of this Warrant subdivides (by any stock split, stock dividend,
recapitalization or otherwise) its outstanding shares of Common Stock into a
greater number of shares, the Warrant Exercise Price in effect immediately prior
to such subdivision will be proportionately reduced and the number of shares of
Common Stock obtainable upon exercise of this Warrant will be proportionately
increased. If the Company at any time after the date of issuance of this Warrant
combines (by combination, reverse stock split or otherwise) its outstanding
shares of Common Stock into a smaller number of shares, the Warrant Exercise
Price in effect immediately prior to such combination will be proportionately
increased and the number of shares of Common Stock obtainable upon exercise of
this Warrant will be proportionately decreased. Any adjustment under this
Section 8(d) shall become effective at the close of business on the date the
subdivision or combination becomes effective.

                  (e) Distribution of Assets. If the Company shall declare or
make any dividend or other distribution of its assets (or rights to acquire its
assets) to holders of Common Stock, by way of return of capital or otherwise
(including, without limitation, any distribution of cash, stock or other
securities, property or options by way of a dividend, spin off,
reclassification, corporate rearrangement or other similar transaction) (a
"DISTRIBUTION"), at any time after the issuance of this Warrant, then, in each
such case:

         (i) the Warrant Exercise Price in effect immediately prior to the close
         of business on the record date fixed for the determination of holders
         of Common Stock entitled to receive the Distribution shall be reduced,
         effective as of the close of business on such record date, to a price
         determined by multiplying such Warrant Exercise Price by a fraction of
         which (A) the numerator shall be the Weighted Average Price of the
         Common Stock on the trading day immediately preceding such record date
         minus the value of the Distribution (as determined in good faith by the
         Company's Board of Directors) applicable to one share of Common Stock,
         and (B) the denominator shall be the Weighted Average Price of the
         Common Stock on the trading day immediately preceding such record date;
         and

         (ii) either (A) the number of Warrant Shares obtainable upon exercise
         of this Warrant shall be increased to a number of shares equal to the
         number of shares of Common Stock obtainable immediately prior to the
         close of business on the record date fixed for the determination of
         holders of Common Stock entitled to receive the Distribution multiplied
         by the reciprocal of the fraction set forth in the immediately
         preceding clause (i), or (B) in the event that the Distribution is of
         common stock of a company whose common stock is traded on a national
         securities exchange or a national automated quotation system, then the
         holder of this Warrant shall receive an additional warrant, the terms
         of which shall be identical to those of this Warrant, except that such
         warrant shall be exercisable for the amount of the assets that would
         have been payable to the holder of this Warrant pursuant to the
         Distribution had the holder exercised this Warrant immediately prior to
         such record date and with an exercise price equal to the amount by
         which the exercise price of this Warrant was decreased with respect to
         the Distribution pursuant to the terms of the immediately preceding
         clause (i).



                                      -13-
<PAGE>
                  (f) Certain Events. If any event occurs of the type
contemplated by the provisions of this Section 8 but not expressly provided for
by such provisions (including, without limitation, the granting of stock
appreciation rights, phantom stock rights or other rights with equity features),
then the Company's Board of Directors will make an appropriate adjustment in the
Warrant Exercise Price and the number of shares of Common Stock obtainable upon
exercise of this Warrant so as to protect the rights of the holders of the
Replacement Warrants; provided that no such adjustment will increase the Warrant
Exercise Price or decrease the number of shares of Common Stock obtainable as
otherwise determined pursuant to this Section 8.

                  (g) Optional Redemption Upon a Cash Private Transaction. (i)
In addition to the rights of the holder of this Warrant under Section 9, upon a
Cash Private Transaction (as defined in the Warrant Agreement) the holder hereof
shall have the right, at such holder's option, to require the Company to redeem
all or any portion of this Warrant at a price equal to 105% of the Black-Scholes
Amount, as determined in Section 8(g)(ii) below (the "CASH PRIVATE TRANSACTION
REDEMPTION PRICE"). No sooner than 40 nor later than 30 Business Days prior to
the consummation of a Cash Private Transaction, but not prior to the public
announcement of such Cash Private Transaction, the Company shall deliver written
notice thereof via facsimile and overnight courier (a "NOTICE OF CASH PRIVATE
TRANSACTION") to the holder of this Warrant. At any time during the period
beginning after such holder's receipt of a Notice of Cash Private Transaction
(or, in the event a Notice of Cash Private Transaction is not delivered at least
30 Business Days prior to a Cash Private Transaction, at any time on or after
the date which is 30 Business Days prior to a Cash Private Transaction) and
ending on and including the date which is ten (10) Business Days prior to the
date of such Cash Private Transaction, the holder hereof may require the Company
to redeem all or any portion of this Warrant by delivering written notice
thereof via facsimile and overnight courier (a "NOTICE OF REDEMPTION UPON CASH
PRIVATE TRANSACTION") to the Company, which Notice of Redemption Upon Cash
Private Transaction shall indicate the portion (as stated in Warrant Shares) of
this Warrant that the holder hereof is submitting for redemption. The date of
the delivery by the holder of this Warrant of the Notice of Redemption Upon Cash
Private Transaction to the Company is referred to herein as the "WARRANT
REDEMPTION NOTICE DATE". Upon the Company's receipt of a Notice(s) of Redemption
Upon Cash Private Transaction from any holder of Replacement Warrants, the
Company will promptly, but in no event later than one (1) Business Day following
such receipt, notify the holder of this Warrant by facsimile of the Company's
receipt of such Notice(s) of Redemption Upon Cash Private Transaction. The
Company shall deliver the Cash Private Transaction Redemption Price
simultaneously with the consummation of the Cash Private Transaction (the
"WARRANT REDEMPTION DATE"); provided that, if required by Section 2(f), this
Warrant shall have been so delivered to the Company. The Company shall not enter
into any binding agreement or other arrangement with respect to a Cash Private
Transaction unless the Company provides that the payments provided for in this
Section 8(g) shall have priority to payments to stockholders in connection with
such Cash Private Transaction and the Company complies with such provision.

         (ii) Black-Scholes Amount. The Black-Scholes Amount referred to in the
         first sentence of Section 8(g)(i) shall mean the amount resulting from
         applying the Black-Scholes pricing model to the portion (as expressed
         in Warrant Shares) of this Warrant, which calculation is made with the
         following inputs: (i) the "option striking price" being equal to the
         Warrant Exercise Price in effect on the fifth (5th) Business Day
         following the public announcement of the pending, proposed, intended or
         consummated Cash Private Transaction (such fifth (5th) Business Day is
         referred to as the "WARRANT REDEMPTION


                                      -14-
<PAGE>


         MEASUREMENT DATE"), (ii) the "interest rate" being equal to the
         interest rate on one year United States Treasury Bills issued most
         recently prior to the Warrant Redemption Measurement Date, (iii) the
         "time until option expiration" being the time from the Warrant
         Redemption Measurement Date until the Expiration Date, (iv) the
         "current stock price" being equal to the Weighted Average Price of the
         Common Stock on the Warrant Redemption Measurement Date, (v) the
         "volatility" being the 100-day historical volatility of the Common
         Stock as of the Warrant Redemption Measurement Date (as reported by the
         Bloomberg "HVT" screen), (vi) the number of Warrant Shares issuable
         upon exercise of the portion of this Warrant being redeemed being equal
         to the number of Warrant Shares set forth in the holder's Notice of
         Redemption Upon Cash Private Transaction, and (vii) the "dividend rate"
         being equal to zero. Within three (3) Business Days after the Company
         Warrant Redemption Measurement Date, each of the Company and the holder
         of this Warrant shall deliver to the other a written calculation of its
         determination of the Black-Scholes Amount. If the holder and the
         Company are unable to agree upon the calculation of the Black-Scholes
         Amount within four (4) Business Days of the Warrant Redemption
         Measurement Date, then the Company shall submit via facsimile the
         disputed calculation to an investment banking firm included on the
         Agreed Upon List (as defined in Section 2(a)) within six (6) Business
         Days of the Warrant Redemption Measurement Date. The Company shall
         cause such investment banking firm to perform the calculations and
         notify the Company and the holder of the results no later than eight
         (8) Business Days after the Company Warrant Redemption Notice Date.
         Such investment banking firm's calculation of the Black-Scholes Amount
         shall be deemed conclusive absent error. The Company shall bear the
         fees and expenses of such investment banking firm for providing such
         calculation.

In the event that the Company does not pay the Cash Private Transaction
Redemption Price in full on the Warrant Redemption Date, then in addition to any
remedy the holder of this Warrant may have under this Warrant and the Warrant
Agreement (including indemnification pursuant to Section 8 thereof) the Cash
Private Transaction Redemption Price payable in respect of this unredeemed
Warrant shall bear interest at the rate of the lesser of 2.0% per month
(prorated for partial months) or the highest lawful maximum interest rate until
paid in full.

                  (h) Notices.

         (i) Immediately upon any adjustment of the Warrant Exercise Price, the
         Company will give written notice thereof to the holder of this Warrant,
         setting forth in reasonable detail, and certifying, the calculation of
         such adjustment.

         (ii) The Company will give written notice to the holder of this Warrant
         at least ten (10) days prior to the date on which the Company closes
         its books or takes a record (A) with respect to any dividend or
         distribution upon the Common Stock, (B) with respect to any pro rata
         subscription offer to holders of Common Stock or (C) for determining
         rights to vote with respect to any Organic Change (as defined below),
         dissolution or liquidation, provided that such information shall be
         made known to the public prior to or in conjunction with such notice
         being provided to such holder.

         (iii) The Company will also give written notice to the holder of this
         Warrant at least ten (10) days prior to the date on which any Organic
         Change, dissolution or liquidation will take place, provided that such
         information shall be made known to the public prior to or in
         conjunction with such notice being provided to such holder.


                                      -15-
<PAGE>
         Section 9. Purchase Rights; Reorganization, Reclassification,
Consolidation, Merger or Sale. (a) In addition to any adjustments pursuant to
Section 8 above, if at any time the Company grants, issues or sells any Options,
Convertible Securities or rights to purchase stock, warrants, securities or
other property pro rata to the record holders of any class of its capital stock
(the "PURCHASE RIGHTS"), then the holder of this Warrant will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate
Purchase Rights that such holder could have acquired if such holder had held the
number of shares of Common Stock acquirable upon complete exercise of this
Warrant immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the
date as of which the record holders of Common Stock are to be determined for the
grant, issue or sale of such Purchase Rights.

                  (b) Any recapitalization, reorganization, reclassification,
consolidation, merger, sale of all or substantially all of the Company's assets
to another Person or other transaction that is effected in such a way that
holders of Common Stock are entitled to receive (either directly or upon
subsequent liquidation) stock, securities or assets with respect to or in
exchange for Common Stock is referred to herein as "ORGANIC CHANGE." Prior to
the consummation of any (i) sale of all or substantially all of the Company's
assets to an acquiring Person or (ii) other Organic Change following which the
Company is not a surviving entity, the Company will secure from the Person
purchasing such assets or the successor resulting from such Organic Change (in
each case, the "ACQUIRING ENTITY") a written agreement (in form and substance
satisfactory to the holders of Replacement Warrants representing at least
two-thirds of the shares of Common Stock obtainable upon exercise of the
Replacement Warrants then outstanding) to deliver to each holder of Replacement
Warrants in exchange for such Replacement Warrants, a security of the Acquiring
Entity evidenced by a written instrument substantially similar in form and
substance to this Warrant and satisfactory to the holders of the Replacement
Warrants (including, an adjusted warrant exercise price equal to the value for
the Common Stock reflected by the terms of such consolidation, merger or sale,
and exercisable for a corresponding number of shares of Common Stock acquirable
and receivable upon exercise of the Replacement Warrants (without regard to any
limitations on exercises), if the value so reflected is less than the Warrant
Exercise Price in effect immediately prior to such consolidation, merger or
sale). Prior to the consummation of any other Organic Change, the Company shall
make appropriate provision (in form and substance satisfactory to the holders of
Replacement Warrants representing at least two-thirds of the shares of Common
Stock obtainable upon exercise of the Replacement Warrants then outstanding) to
ensure that each of the holders of the Replacement Warrants will thereafter have
the right to acquire and receive in lieu of or in addition to (as the case may
be) the shares of Common Stock immediately theretofore acquirable and receivable
upon the exercise of such holder's Replacement Warrants (without regard to any
limitations on exercises), such shares of stock, securities or assets that would
have been issued or payable in such Organic Change with respect to or in
exchange for the number of shares of Common Stock that would have been
acquirable and receivable upon the exercise of such holder's Warrant as of the
date of such Organic Change (without taking into account any limitations or
restrictions on the exercisability of this Warrant).

         Section 10. Lost, Stolen, Mutilated or Destroyed Warrant. If this
Warrant is lost, stolen, mutilated or destroyed, the Company shall promptly, on
receipt of an indemnification undertaking (or in the case of a mutilated
Warrant, the Warrant), issue a new Warrant of like denomination and tenor as
this Warrant so lost, stolen, mutilated or destroyed.



                                      -16-
<PAGE>

         Section 11. Notice. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of this Warrant
must be in writing and will be deemed to have been delivered: (i) upon receipt,
when delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:

                  If to the Company:

                           Zix Corporation
                           2711 N. Haskell Avenue
                           Suite 2300
                           Dallas, Texas 75204
                           Telephone:       214-370-2000
                           Facsimile:       214-515-7385
                           Attention:       General Counsel

                  With a copy to:

                           Hughes & Luce L.L.P.
                           111 Congress Avenue, 9th Floor
                           Austin, Texas 78701
                           Telephone:       512-482-6800
                           Facsimile:       512-482-6859
                           Attention:       Bryan C. Wittman, Esq.


If to a holder of this Warrant, to it at the address and facsimile number set
forth on the Schedule of Investors to the Warrant Agreement, with copies to such
holder's representatives as set forth on such Schedule of Investors, or, in the
case of the holder or any other Person named above, at such other address and/or
facsimile number and/or to the attention of such other person as the recipient
party has specified by written notice to the other party at least five (5) days
prior to the effectiveness of such change. Written confirmation of receipt (A)
given by the recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a nationally recognized overnight
delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.

         Section 12. Limitation on Number of Warrant Shares. The Company shall
not be obligated to issue any shares of Common Stock upon exercise of this
Warrant if the issuance of such shares of Common Stock would cause the Company
to exceed that number of shares of Common Stock which the Company may issue upon
exercise of the Replacement Warrants (the "EXCHANGE CAP") without breaching the
Company's obligations under the rules or regulations of the Principal Market,
except that such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules of
the Principal Market (or any successor rule or regulation) for issuances of
Common Stock in excess of such amount. Until such approval is obtained, the
holder of this Warrant shall not be issued, upon




                                      -17-
<PAGE>
exercise of the Replacement Warrants, shares of Common Stock in an amount
greater than the product of (i) the Exchange Cap amount multiplied by (ii) a
fraction, the numerator of which is the principal amount of Convertible Notes
(as defined in the Warrant Agreement) issued to the holder of this Warrant
pursuant to the Securities Purchase Agreement (as defined in the Warrant
Agreement) and the denominator of which is the aggregate principal amount of all
Convertible Notes issued pursuant to the Securities Purchase Agreement (the "CAP
ALLOCATION AMOUNT"). In the event that any holder shall sell or otherwise
transfer any of such holder's Replacement Warrants, the transferee shall be
allocated a pro rata portion of such holder's Cap Allocation Amount. In the
event that any holder of Replacement Warrants shall exercise all of such
holder's Replacement Warrants into a number of shares of Common Stock which, in
the aggregate, is less than such holder's Cap Allocation Amount, then the
difference between such holder's Cap Allocation Amount and the number of shares
of Common Stock actually issued to such holder shall be allocated to the
respective Cap Allocation Amounts of the remaining holders of Replacement
Warrants on a pro rata basis in proportion to the number of shares then issuable
to each such holder pursuant to the Replacement Warrants. In the event the
Company is prohibited from issuing Warrant Shares as a result of the operation
of this Section 12, the Company shall redeem for cash the portion of this
Warrant with respect to the Warrant Shares that cannot be issued as a result of
this Section 12, at a price per Warrant Share equal to the difference between
the Weighted Average Price and the Warrant Exercise Price of the Common Stock as
of the date of the attempted exercise.

         Section 13. Date. The date of this Warrant is ______________, 2003 (the
"WARRANT DATE"). This Warrant, in all events, shall be wholly void and of no
effect after 11:59 P.M. New York Time on the Expiration Date, except that
notwithstanding any other provisions hereof, the provisions of Section 7 shall
continue in full force and effect after such date as to any Warrant Shares or
other securities issued upon the exercise of this Warrant.

         Section 14. Amendment and Waiver. Except as otherwise provided herein,
the provisions of the Replacement Warrants may be amended and the Company may
take any action herein prohibited, or omit to perform any act herein required to
be performed by it, only if the Company has obtained the written consent of the
holders of Replacement Warrants representing at least two-thirds of the shares
of Common Stock obtainable upon exercise of the Replacement Warrants then
outstanding; provided that no such action may increase the Warrant Exercise
Price of the Replacement Warrants or decrease the number of shares or change the
class of stock obtainable upon exercise of any Replacement Warrants without the
written consent of the holder of such Replacement Warrant.

         Section 15. Descriptive Headings; Governing Law. The descriptive
headings of the several sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. All questions
concerning the construction, validity, enforcement and interpretation of this
Warrant shall be governed by the internal laws of the State of New York, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.




                                      -18-
<PAGE>
         IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
________________, its ______________________, as of _________________, 2003.


                                  ZIX CORPORATION


                                  By:
                                         -------------------------------------
                                  Name:
                                  Title:



<PAGE>
                              EXHIBIT A TO WARRANT
                                 EXERCISE NOTICE
        TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

                                 ZIX CORPORATION

         The undersigned holder hereby exercises the right to purchase
_________________ of the shares of Common Stock ("WARRANT SHARES") of Zix
Corporation (formerly known as Zixit Corporation), a Texas corporation (the
"COMPANY"), evidenced by the attached Warrant (the "WARRANT"). Capitalized terms
used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant.

         1. Form of Exercise Price. The Holder intends that payment of the
Warrant Exercise Price shall be made as:

        ________________ a "CASH EXERCISE" with respect to ___________________
                             Warrant Shares; and/or

        ________________ a "CASHLESS EXERCISE" with respect to ________________
                             Warrant Shares (to the extent permitted by the
                             terms of the Warrant).

         2. Payment of Exercise Price. In the event that the holder has elected
a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of
$___________________ to the Company in accordance with the terms of the Warrant.

         3.  Delivery of Warrant Shares.  The Company shall deliver ___________
Warrant Shares in accordance with the terms of the Warrant in the following name
and to the following address:

Issue to:
         ----------------------------------------------------------------------

         Facsimile Number:
                          -----------------------------------------------------

         DTC Participant Number and Name (if electronic book entry
         transfer): ___________________________________________________________

         Account Number (if electronic book entry transfer): __________________

Date: __________  ____, _______


-------------------------------
   Name of Registered Holder

By:
   -----------------------------------------
Name:
Title:



<PAGE>
                                 ACKNOWLEDGMENT


         The Company hereby acknowledges this Exercise Notice and hereby directs
[TRANSFER AGENT] to issue the above indicated number of shares of Common Stock
in accordance with the Transfer Agent Instructions dated ________________, 200_
from the Company and acknowledged and agreed to by [TRANSFER AGENT].


                                  ZIX CORPORATION


                                  By:
                                         -------------------------------------
                                  Name:
                                         -------------------------------------
                                  Title:
                                         -------------------------------------


<PAGE>
                              EXHIBIT B TO WARRANT

                              FORM OF WARRANT POWER


FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of Zix Corporation, a Texas
corporation, represented by warrant certificate no. _____, standing in the name
of the undersigned on the books of said corporation. The undersigned does hereby
irrevocably constitute and appoint ______________, attorney to transfer the
warrants of said corporation, with full power of substitution in the premises.


Dated: __________, 200_



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

                                    Name:
                                             ----------------------------------
                                    Title:
                                             ----------------------------------