**EXHIBIT
      4.12.1**





**INITIAL
      WARRANT**





THE
      WARRANT EVIDENCED OR CONSTITUTED HEREBY, AND ALL SHARES OF COMMON STOCK
      DELIVERABLE UPON EXERCISE HEREUNDER, HAVE BEEN AND WILL BE ISSUED WITHOUT
      REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”) AND MAY
      NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED WITHOUT
      REGISTRATION UNDER THE ACT UNLESS EITHER (A) THE COMPANY HAS RECEIVED AN OPINION
      OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO
      THE
      EFFECT THAT REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION
      OR
      (B) THE SALE OF SUCH SECURITIES IS MADE PURSUANT TO SECURITIES AND EXCHANGE
      COMMISSION RULE 144.





Date:                                          
      , 2008





**WARRANT
      TO PURCHASE COMMON STOCK**





**OF**





**INTERMETRO
      COMMUNICATIONS, INC.**





THIS
      CERTIFIES THAT, for value
      received,                                                  
(“ Holder ”),
      is
      entitled, subject to the terms and conditions of this Warrant, at any time
      or
      from time to time on or after the date hereof, to purchase up to
      (                      
) shares of Common Stock (the “Warrant Shares”), from InterMetro Communications,
      Inc., a Nevada corporation (the “ Company ”),
      at an
      exercise price per share equal to one dollar ($1.00) (as adjusted from time
      to
      time, the “Purchase Price). This Warrant shall expire at 5:00 p.m. Pacific time
      on                                         
 , 2013 (the “ Expiration
      Date ”).
      Both
      the number of shares of Common Stock purchasable upon exercise of this Warrant
      (the “ Warrant
      Shares ”)
      and
      the Purchase Price are subject to adjustment and change as provided herein.
      This
      Warrant is one constituent part of a multi-part Unit issued pursuant to the
      Loan
      and Security Agreement dated January 16, 2008, between the Company, the
      Subsidiaries, the Agent and the Lenders named therein, including Holder (the
      “Loan Agreement”).





1. CERTAIN
      DEFINITIONS .
      As used
      in this Warrant the following terms shall have the following respective
      meanings:





“ 1933
      Act ”
shall
      mean the Securities Act of 1933, as amended.





“ Common
      Stock ”
shall
      mean the Common Stock, par value $0.001 per share, of the Company and any other
      securities at any time receivable or issuable upon exercise of this
      Warrant.





“ Fair
      Market Value ”
or
      “ FMV ”
of
      a
      share of Common Stock as of a particular date shall mean:





(a)
      If
      traded on a national securities exchange or the Nasdaq Capital Market, the
      Fair
      Market Value shall be deemed to be the average of the closing prices of the
      Common Stock of the Company on such exchange or market over the five (5) trading
      days ending immediately prior to the applicable date of valuation;





(b)
      If
      actively traded over-the-counter, the Fair Market Value shall be deemed to
      be
      the average of the closing bid prices over the 10 trading days ending
      immediately prior to the applicable date of valuation; and








(c)
      If
      there is no active public market, the Fair Market Value shall be the value
      as
      determined in good faith by the Company’s Board of Directors upon a review of
      relevant factors, including due consideration of the Holder’s determination of
      the value of the Company. The foregoing notwithstanding, if Holder advises
      the
      Board of Directors in writing that Holder disagrees with such determination,
      then the Company and Holder shall promptly agree upon a reputable investment
      banking firm to undertake such valuation. If the valuation of such investment
      banking firm is greater than that determined by the board of directors, then
      all
      fees and expenses of such investment banking firm shall be paid by the Company.
      In all other circumstances, such fees and expenses shall be paid by
      Holder.





“ Note ”
shall
      mean the Company’s Secured Convertible Promissory Note issued to Holder pursuant
      to the Loan Agreement.





“ SEC ”
shall
      mean the Securities and Exchange Commission.




2. EXERCISE
      OF WARRANT





2.1 Payment .
      Subject
      to compliance with the terms and conditions of this Warrant and applicable
      securities laws and subject to the limitation in Section 21.2 hereof, this
      Warrant may be exercised, in whole or in part at any time or from time to time,
      on or before the Expiration Date by the delivery (including, without limitation,
      delivery by facsimile) of the form of Notice of Exercise attached hereto as Exhibit
      1 (the
“ Notice
      of Exercise ”),
      duly
      executed by the Holder, at the address of the Company as set forth herein,
      and
      as soon as practicable after such date,





(a)
      surrendering this Warrant at the address of the Company, and either





(b)
      providing payment, by check or by wire transfer, or, if applicable, by
      cancellation of any debt of the Company to the Holder or Section 21 Payment
      (as
      defined in Section 21) payable to the Holder as of immediately prior to such
      exercise, of an amount equal to the product obtained by multiplying the number
      of shares of Common Stock being purchased upon such exercise by the then
      effective Purchase Price (the “ Exercise
      Amount ”),
      or





(c)
      electing, by written notice to the Company on the Notice of Exercise duly
      executed by the Holder, to receive a number of Warrant Shares, determined in
      accordance with the formula set forth below (the “Election”), in which event the
      Company shall issue to the Holder a number of Warrant Shares computed using
      the
      following formula:





X= Y(A-B)


A





Where
      X =
      The number of Warrant Shares to be issued to the Holder upon an
      Election.





Y
                =
            The
                number of Warrant Shares in respect of which this Warrant is being
                exercised.





A
                =
            The
                FMV of one Warrant Share on the date that the relevant Notice of
                Exercise
                is received by the Company.





B
                =
            The
                Purchase Price (as adjusted to the date of the Election) in accordance
                with Section 4 hereof





2.2 Common
      Stock Certificates; Fractional Shares .
      As soon
      as practicable on or after the date of an exercise of this Warrant and in any
      event within 10 days thereafter, the Company shall deliver to the person or
      persons entitled to receive the same a certificate or certificates for the
      number of whole shares of Common Stock issuable upon such exercise. No
      fractional shares or scrip representing fractional shares of Common Stock shall
      be issued upon an exercise of this Warrant. In lieu thereof the Company shall
      pay Holder the Fair Market Value of such fractional share.









2.3 Partial
      Exercise: Effective Date of Exercise .
      In case
      of any partial exercise of this Warrant, the Holder and the Company shall cancel
      this Warrant upon surrender hereof and shall execute and deliver a new Warrant
      of like tenor and date for the balance of the shares of Common Stock purchasable
      hereunder. This Warrant shall be deemed to have been exercised immediately
      prior
      to the close of business on the date of its surrender for exercise as provided
      above. The Company acknowledges that the person entitled to receive the shares
      of Common Stock issuable upon exercise of this Warrant shall be treated for
      all
      purposes as the holder of record of such shares as of the close of business
      on
      the date the Holder is deemed to have exercised this Warrant.





3. TAXES .
      The
      Company shall pay all taxes and other governmental charges that may be imposed
      in respect of the delivery of shares upon exercise of this Warrant; provided , however , that
      the Company shall not be required to pay any tax or other charge imposed in
      connection with any transfer involved in the delivery of any certificate for
      shares of Common Stock in any name other than that of the Holder of this
      Warrant, and in such case the Company shall not be required to deliver any
      stock
      certificate until such tax or other charge has been paid, or it has been
      established to the Company’s reasonable satisfaction that no tax or other charge
      is due.





4. ADJUSTMENT
      OF PURCHASE PRICE AND NUMBER OF SHARES OF COMMON STOCK .
      The
      number of shares of Common Stock deliverable upon exercise of this Warrant
      (or
      any shares of stock or other securities or property receivable upon exercise
      of
      this Warrant) and the Purchase Price are subject to adjustment upon occurrence
      of the following:





4.1 Adjustment
      for Stock Splits, Stock Subdivisions or Combinations of Shares of Common
      Stock .
      The
      Purchase Price of this Warrant shall be proportionally decreased and the number
      of shares of Common Stock deliverable upon exercise of this Warrant (or any
      shares of stock or other securities at the time deliverable upon exercise of
      this Warrant) shall be proportionally increased to reflect any stock split
      or
      subdivision of the Company’s Common Stock. The Purchase Price of this Warrant
      shall be proportionally increased and the number of shares of Common Stock
      deliverable upon exercise of this Warrant (or any shares of stock or other
      securities at the time deliverable upon exercise of this Warrant) shall be
      proportionally decreased to reflect any combination of the Company’s Common
      Stock.





4.2 Adjustment
      for Dividends or Distributions of Stock or Other Securities or
      Property .
      In case
      the Company shall make or issue, or shall fix a record date for the
      determination of eligible holders entitled to receive, a dividend or other
      distribution with respect to the Common Stock (or any shares of stock or other
      securities at the time issuable upon exercise of the Warrant) payable in (a)
      securities of the Company or (b) assets (excluding cash dividends paid or
      payable solely out of retained earnings), then, in each such case, the Holder
      of
      this Warrant on exercise hereof at any time after the consummation, effective
      date or record date of such dividend or other distribution, shall receive,
      in
      addition to the shares of Common Stock (or such other stock or securities)
      issuable on such exercise prior to such date, and without the payment of
      additional consideration therefor, the securities or such other assets of the
      Company to which such Holder would have been entitled upon such date if such
      Holder had exercised this Warrant immediately prior to such making, issuance
      or
      record date.





4.3 Reclassification,
      Conversion .
      If the
      Company, by reclassification of securities or conversion of securities or
      otherwise, shall change any of the securities as to which purchase rights under
      this Warrant exist into the same or a different number of securities of any
      other class or classes, this Warrant shall thereafter represent the right to
      acquire such number and kind of securities as would have been issuable if this
      Warrant had been exercised immediately prior to such reclassification or
      conversion or other change and the Purchase Price therefore shall be
      appropriately adjusted, all subject to further adjustment as provided in this
      Section 4.





4.4 Adjustment
      for Capital Reorganization. Merger or Consolidation .
      In case
      of any capital reorganization of the capital stock of the Company (other than
      a
      combination, reclassification, exchange or subdivision of shares otherwise
      provided for herein), or any merger or consolidation of the Company with or
      into
      another corporation, or the sale of all or substantially all the assets of
      the
      Company then, and in each such case, as a part of such reorganization, merger,
      consolidation, sale or transfer, lawful provision shall be made so that the
      Holder of this Warrant shall thereafter be entitled to receive upon exercise
      of
      this Warrant the number of shares of stock or other securities or property
      that
      a holder of the shares deliverable upon exercise of this Warrant would have
      been
      entitled to receive in such reorganization, consolidation, merger, sale or
      transfer if this Warrant had been exercised immediately before such
      reorganization, merger, consolidation, sale or transfer, all subject to further
      adjustment as provided in this Section 4. The foregoing provisions of this
      Section 4.4 shall similarly apply to successive reorganizations, consolidations,
      mergers, sales and transfers and to the stock or securities of any other
      corporation that are at the time receivable upon the exercise of this Warrant.
      If the per-share consideration payable to the Holder hereof for shares in
      connection with any such transaction is in a form other than cash or marketable
      securities, then the value of such consideration shall be determined in good
      faith by the Company’s Board of Directors. In all events, appropriate adjustment
      (as determined in good faith by the Company’s Board of Directors) shall be made
      in the application of the provisions of this Warrant with respect to the rights
      and interests of the Holder after the transaction, to the end that the
      provisions of this Warrant shall be applicable after that event, as near as
      reasonably may be, in relation to any shares or other property deliverable
      after
      that event upon exercise of this Warrant.







4.5 Notice
      of Adjustment .
      Whenever the number of shares of Common Stock purchasable upon the exercise
      of
      this Warrant or the Purchase Price is adjusted, or the Company’s Board of
      Directors makes a determination of Fair Market Value in connection with any
      such
      adjustment, the Company shall promptly notify the Holder in writing of any
      such
      adjustment or FMV determination, setting forth a brief statement of the facts
      requiring such adjustment, the computation by which such adjustment was made,
      and the basis for the FMV determination.





4.6 **** No
      Impairment .
      The
      Company will not, by any voluntary action, avoid or seek to avoid the observance
      or performance of any of the terms of this Warrant to be observed or performed
      by the Company, but shall at all times in good faith assist in the carrying
      out
      of all provisions of this Section 4 and in the taking of all such action as
      may
      be necessary or appropriate in order to protect the rights of the Holder of
      this
      Warrant against impairment.





5. LOSS
      OR MUTILATION .
      Upon
      receipt of evidence reasonably satisfactory to the Company of the ownership
      of
      and the loss, theft, destruction or mutilation of this Warrant, and of indemnity
      reasonably satisfactory to it, and (in the case of mutilation) upon surrender
      and cancellation of this Warrant, the Company will cause to be executed and
      delivered in lieu thereof a new Warrant of like tenor as the lost, stolen,
      destroyed or mutilated Warrant.





6. REPRESENTATION
      AND COVENANT. The
      Company hereby represents and warrants that all shares issuable pursuant to
      this
      Warrant, when delivered pursuant to the terms hereof, shall be validly issued,
      fully paid and nonassessable and free and clear of all liens, security
      interests, charges and other encumbrances or restrictions on sale and free
      and
      clear of all preemptive rights, except encumbrances or restrictions arising
      under federal or state securities laws. Further, the Company hereby covenants
      to
      reserve such number of authorized but unissued shares of Common Stock as needed
      for issuance pursuant to this Warrant.





7. TRANSFER .
      Subject
      to Section 10, this Warrant and all rights hereunder may be transferred by
      the
      Holder upon delivery of the form of Assignment attached hereto as Exhibit
      2 (the
“ Assignment ”),
      duly
      executed by the Holder, surrender of this Warrant properly endorsed at the
      address of the Company and payment of any necessary transfer tax or other
      governmental charge imposed upon such transfer. Upon any partial transfer,
      the
      Holder and Company will cause to be issued and delivered to the Holder a new
      Warrant or Warrants with respect to the portion of this Warrant not so
      transferred. Each taker and holder of this Warrant, by taking or holding the
      same, consents and agrees that when this Warrant shall have been so endorsed,
      the person in possession of this Warrant may be treated by the Company, and
      all
      other persons dealing with this Warrant, as the absolute owner hereof for any
      purpose and as the person entitled to exercise the rights represented hereby,
      any notice to the contrary notwithstanding; provided, however that until a
      transfer of this Warrant is duly registered on the books of the Company, the
      Company may treat the Holder hereof as the owner for all purposes.





8. REGISTRATION
      RIGHTS .
      Pursuant to the terms of a Registration Rights Agreement of even date herewith
      between the Company and Holders of Registrable Securities (as defined in the
      Registration Rights Agreement) the Holder shall have and be entitled to exercise
      the rights of registration with respect to the shares of Common Stock issued
      pursuant to this Agreement as provided for in such Agreement.





9. PUT
      OPTION .
      Any
      time after the Maturity Date of the Note until the first anniversary of the
      date
      thereof, the Holder may submit this Warrant to the Company for cancellation
      and
      receive an amount in cash equal to 15% of the Purchase Price times the number
      of
      Warrant Shares then purchasable upon exercise of this Warrant (the “Put
      Option”). The Company shall make such payment within 10 days of Holder’s
      delivery of the Warrant to the Company for cancellation. Upon payment by the
      Company of the amount due hereunder, all of Holder’s rights hereunder, including
      the right to receive any Section 21 Payment, shall terminate.








10. RESTRICTIONS
      ON TRANSFER .
      The
      Holder, by acceptance hereof, agrees that, absent an effective registration
      statement filed with the SEC under the 1933 Act, covering the disposition or
      sale of this Warrant or the Common Stock issued or issuable pursuant hereto,
      and
      registration or qualification under applicable state securities laws, such
      Holder will not sell, transfer, pledge, or hypothecate any or all such Warrants
      or Common Stock, as the case may be, unless either (i) the Company has received
      an opinion of counsel, in form and substance reasonably satisfactory to the
      Company, to the effect that such registration is not required in connection
      with
      such disposition or (ii) the sale of such securities is made pursuant to SEC
      Rule 144.





11. COMPLIANCE
      WITH SECURITIES LAWS .
      By
      acceptance of this Warrant, the Holder hereby represents, warrants and covenants
      that he/she/it is an “accredited investor” as that term is defined under Rule
      501 of Regulation D, that any shares of stock purchased upon exercise of this
      Warrant or acquired pursuant hereto shall be acquired for investment only and
      not with a view to, or for sale in connection with, any distribution thereof,
      that the Holder has had such opportunity as such Holder has deemed adequate
      to
      obtain from representatives of the Company such information as is necessary
      to
      permit the Holder to evaluate the merits and risks of its investment in the
      Company; that the Holder is able to bear the economic risk of holding such
      shares as may be acquired pursuant to this Warrant for an indefinite period;
      that the Holder understands that the shares of stock acquired pursuant to this
      Warrant will not be registered under the 1933 Act (unless otherwise required
      pursuant to exercise by the Holder of the registration rights, if any,
      previously granted to the Holder) and will be “restricted securities” within the
      meaning of Rule 144 under the 1933 Act and that the exemption from registration
      under Rule 144 will not be available for at least six months from the date
      the
      shares are acquired, and even then will not be available unless a public market
      then exists for the stock, adequate information concerning the Company is then
      available to the public, and other terms and conditions of Rule 144 are complied
      with; and that all stock certificates representing shares of stock issued to
      the
      Holder pursuant to this Warrant may have affixed thereto a legend substantially
      in the following form:




THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE.
      THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
      AND
      MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND ANY
      APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
      THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
      FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER
      OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
      SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE
      IS
      IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES
      LAWS.





12. NO
      RIGHTS OR LIABILITIES AS STOCKHOLDERS .
      This
      Warrant shall not entitle the Holder to any voting rights or other rights as
      a
      stockholder of the Company. Until the Holder acquires Common Stock pursuant
      to
      this Warrant, no provisions of this Warrant, and no enumeration herein of the
      rights or privileges of the Holder hereof shall cause such Holder hereof to
      be a
      shareholder of the Company for any purpose.





13. NOTICES .
      All
      notices and other communications required or permitted hereunder shall be in
      writing and shall be delivered by registered or certified mail, postage prepaid,
      return receipt requested, or by telecopier, or by email or otherwise delivered
      by hand or by messenger, addressed, telecopied or emailed to the person to
      whom
      such notice or communication is being given at its address set forth after
      its
      signature hereto. In order to be effective, a copy of any notice or
      communication sent by telecopier or email must be sent by registered or
      certified mail, postage prepaid, return receipt requested, by nationally
      recognized overnight courier or delivered personally to the person to whom
      such
      notice or communication is being at its address set forth after its signature
      hereto. If notice is provided by mail, notice shall be deemed to be given five
      (5) business days after proper deposit with the United States mail or the next
      business day after deposit with a nationally recognized overnight courier,
      or
      immediately upon personal delivery thereof. If notice is provided by telecopier,
      notice shall be deemed to be given upon confirmation by the telecopier machine
      of the receipt of such notice. If notice is provided by email, notice shall
      be
      deemed to be given upon confirmation by the sender’s email program that the
      recipient received the email. The addresses set forth after the signatures
      hereto may be changed by written notice complying with the terms of this Section
      13.








14. HEADINGS .
      The
      headings in this Warrant are for purposes of convenience in reference only,
      and
      shall not be deemed to constitute a part hereof.





15. LAW
      GOVERNING AND VENUE. This
      Warrant shall be construed and enforced in accordance with, and governed by,
      the
      laws of the State of California, without giving effect to the principles of
      conflicts of law. The Company and Holder agree that the sole jurisdiction and
      venue for any litigation arising out of this Warrant involving the Company
      or
      Holder shall be in the appropriate federal or state court located in Los Angeles
      County, California.





16. NOTICES
      OF RECORD DATE .
      In
      case:





16.1
      the
      Company shall take a record of the holders of its Common Stock (or other stock
      or securities at the time receivable upon the exercise of this Warrant), for
      the
      purpose of entitling them to receive any dividend or other distribution, or
      any
      right to subscribe for or purchase any shares of stock of any class or any
      other
      securities or to receive any other right; or





16.2
      of
      any consolidation or merger of the Company with or into another corporation,
      any
      capital reorganization of the Company, any reclassification of the capital
      stock
      of the Company, or any conveyance of all or substantially all of the assets
      of
      the Company to another corporation in which holders of the Company’s stock are
      to receive stock, securities or property of another corporation; or





16.3
      of
      any voluntary or involuntary dissolution, liquidation or winding-up of the
      Company; or





16.4
      of
      any redemption of any outstanding capital stock of the Company; then, and in
      each such case, the Company will mail or cause to be mailed to the Holder of
      this Warrant a notice specifying, as the case may be, (i) the date on which
      a
      record is to be taken for the purpose of such dividend, distribution or right
      and the amount and character of any such dividend, distribution or right, or
      (ii) the date on which such reorganization, reclassification, consolidation,
      merger, conveyance, dissolution, liquidation, winding-up, redemption or
      conversion is to take place, and the time, if any is to be fixed, as of which
      the holders of record of Common Stock (or such stock or securities as at the
      time are receivable upon the exercise of this Warrant) shall be entitled to
      exchange their shares of Common Stock (or such other stock or securities) for
      securities or other property deliverable upon such reorganization,
      reclassification, consolidation, merger, conveyance, dissolution, liquidation
      or
      winding-up. Such notice shall be delivered at least thirty (30) days prior
      to
      the date therein specified.





17. SEVERABILITY .
      If any
      term, provision, covenant or restriction of this Warrant is held by a court
      of
      competent jurisdiction to be invalid, void or unenforceable, the remainder
      of
      the terms, provisions, covenants and restrictions of this Warrant shall remain
      in full force and effect and shall in no way be affected, impaired or
      invalidated.





18. COUNTERPARTS .
      For the
      convenience of the parties, any number of counterparts of this Warrant may
      be
      executed by the parties hereto and each such executed counterpart shall be,
      and
      shall be deemed to be, an original instrument.





19. SATURDAYS,
      SUNDAYS AND HOLIDAYS .
      If the
      Expiration Date falls on a Saturday, Sunday or legal holiday, the Expiration
      Date shall automatically be extended until 5:00 p.m. on the next business
      day.








20. ATTORNEY’S
      FEES .
      Should
      either party hereto institute any action or proceeding to enforce or interpret
      this Warrant or any provisions hereof or for a declaration of rights under
      this
      Warrant, the prevailing party in such action or proceeding shall be entitled
      to
      receive from the other party all costs and expenses, including reasonable
      attorney’s fees, in connection therewith.





21. CERTAIN
      PAYMENTS .
      To the
      extent that this Warrant is unexercised on February 1, 2009, the following
      payment (the “Section 21 Payment”) shall be payable to the Holder
      hereof:





21.1  Amount
      of Payment .
      The
      amount of the Section 21 Payment shall be equal to the product of (a) the
      amount, if any, by which $1.00 exceeds the 30 Day VWAP determined as of January
      30, 2009 multiplied by (b) the number of Warrant Shares for which this Warrant
      is then exercisable (with the dollar amount and number of shares being subject
      to adjustment for stock splits, stock subdivisions or combinations of shares
      of
      Common Stock). If the 30 Day VWAP determined as of January 30, 2009 is equal
      to
      $1.00 or more (with such dollar amount being subject to adjustment for stock
      splits, stock subdivisions or combinations of shares of Common Stock), there
      shall be no Section 21 Payment and the provisions of this Section 21 shall
      immediately terminate.





21.2  Form
      of Payment .
      The
      Section 21 Payment shall be made by the Company in the form of cash or Common
      Stock. The choice of form of payment shall be in the sole discretion of the
      Company. If the Company elects to pay in Common Stock and not cash, then the
      Holder’s right to exercise this Warrant pursuant to Section 2 shall thereafter
      be limited to a number of shares of Common Stock which, together with the number
      of shares of Common Stock previously delivered as a Section 21 Payment, does
      not
      exceed the number of shares for which this Warrant was originally exercisable
      (with such share amounts being subject to adjustment for stock splits,
      subdivisions, or combinations of shares of Common Stock).





21.3  Timing
      of Payment . The
      Section 21 Payment shall be made, in whole or in part, at
      such
      time or times as the Holder shall, in its sole discretion, determine by notice
      to the Company, provided that such payment may be requested no earlier than
      February 1, 2009 and no later than the Expiration Date. The amount requested
      by
      Holder to be paid (whether in cash or Common Stock) shall be delivered by the
      Company promptly, but in any event within 10 days of receipt of the Holder’s
      notice.





21.4  Valuation
      of Common Stock .
      In the
      event that the Company elects to make a Section 21 Payment in the form of Common
      Stock, such Common Stock shall be valued at the Fair Market Value thereof on
      the
      date of the Holder’s notice requesting payment. In no event shall the Company be
      obligated to issue a number of shares of Common Stock as a Section 21 Payment
      which, together with shares issued upon prior exercise of this Warrant, exceed
      the number of shares for which this Warrant was originally exercisable (with
      such share amounts being subject to adjustment for stock splits, stock
      subdivisions or combinations of shares of Common Stock). In the event that,
      but
      for the preceding sentence, the Section 21 Payment would, if paid in shares
      of
      Common Stock, exceed the share limitation in the preceding sentence, the Company
      shall not be obligated to make any additional cash payment hereunder and the
      stock issuance contemplated by the preceding sentence shall be the entire
      Section 21 Payment obligation of the Company.




21.5  Call
      Option .
      If a
      Section 21 Payment is due Holder, in lieu of making such payment, the Company
      shall have the right (“Call Option”) to cancel this Warrant and terminate
      Holder’s rights hereunder by payment to Holder of an amount in cash equal to
      $3.00 times the number of shares for which this Warrant is exercisable on
      February 1, 2009, payable with the notice referred to in Section 21.6 (with
      such
      dollar and share amounts being subject to adjustment for stock splits, stock
      subdivisions or combinations of shares of Common Stock).





21.6  Put
      Option .
      In the
      event that shares of Common Stock are issued as the Section 21 Payment, at
      any
      time after the Maturity Date of the Note until the first anniversary of the
      date
      thereof, the Holder may submit the shares of Common Stock as the Section 21
      Payment to the Company for cancellation and receive an amount in cash equal
      to
      $0.15 per share (with such dollar amount being subject to adjustment for stock
      splits, stock subdivisions or combinations of shares of Common Stock). The
      Company shall make such payment within 10 days of Holder’s delivery of the
      certificates representing such shares to the Company for cancellation. Upon
      payment by the Company of the amount due hereunder, all of Holder’s rights as a
      shareholder with respect to such shares shall terminate.








21.7  Notice .
      No
      later than February 10, 2009, the Company shall send a notice to the Holder
      which shall state (i) the amount of the Section 21 Payment, (ii) the
      Company’s election to make the Section 21 Payment in cash or in Common Stock,
      which election shall be irrevocable, or (iii) that the Company elects to
      exercise its Call Option in lieu of making the Section 21 Payment.





21.8  Definition
      of VWAP .
      VWAP
      means, for any date, the price determined by the first of the following clauses
      that applies: (a) if the Common Stock is then traded on a national securities
      exchange or the NASDAQ Capital Market), the daily volume weighted average price
      of the Common Stock for such date (or the nearest preceding date) on the primary
      trading market on which the Common Stock is then listed or quoted as reported
      by
      Bloomberg Financial L.P. (based on a Trading Day from 9:30 a.m. EST to 4:02
      p.m.
      Eastern Time) using the VAP function or (b) if the Common Stock is not then
      listed or quoted on such a trading market and if prices for the Common Stock
      are
      then reported in the “Pink Sheets” published by the Pink Sheets, LLC (or a
      similar organization or agency succeeding to its functions of reporting prices),
      the most recent bid price per share of the Common Stock so
      reported.





22.  Survival .
      Anything to the contrary notwithstanding, Sections 13, 14, 15, 17, 19 and 20
      hereof shall survive any cancellation or termination of this
      Warrant.





[SIGNATURE
      PAGE TO FOLLOW]





IN
      WITNESS WHEREOF, the parties hereto have executed this Warrant as of date first
      written above.




**INTERMETRO
                COMMUNICATIONS, INC.**
            
            **HOLDER:**By:Name:Charles
                Rice
            
            SignatureTitle:President
                and Chief Executive OfficerPrint
                NameTitle
                if applicableAddress
                for Notices:
            
            Address
              for Notices:2685
                Park Center Drive, BuildingSimi
                Valley, California 93065Fax:
            
            
            Fax:Email:
                Charles.Rice@Intermetro.net
            
            Email:









**EXHIBIT
      1**





**NOTICE
      OF EXERCISE**





(To
      be
      executed upon exercise of Warrant)





_________________
            WARRANT
                NO. ___





The
      undersigned hereby irrevocably elects to exercise the right of purchase
      represented by the within Warrant Certificate for, and to purchase thereunder,
      securities of InterMetro Communications, Inc., as provided for therein, and
      (check the applicable box):





o
              Tenders
                  herewith payment of the exercise price in full in the form of cash
                  or a
                  certified or official bank check in same-day funds in the amount
                  of
                  $____________ for _________ such
                  securities.
  o
              Elects
                  to convert the Warrant pursuant to the cashless exercise feature
                  set forth
                  in Section 2.1(c) as to ____________Warrant Shares.




Please
      issue a certificate or certificates for such securities in the name of, and
      pay
      any cash for any fractional share to (please print name, address and social
      security number):





Name:Address:Signature:




Note:
      The
      above signature should correspond exactly with the name on the first page of
      this Warrant Certificate or with the name of the assignee appearing in the
      assignment form below.





If
      said
      number of shares shall not be all the shares purchasable under the within
      Warrant Certificate, a new Warrant Certificate is to be issued in the name
      of
      said undersigned for the balance remaining of the shares purchasable thereunder
      rounded up to the next higher whole number of shares.







EXHIBIT
      2





**ASSIGNMENT**





**(To
                be executed only upon assignment of Warrant
                Certificate)**
            **WARRANT
                NO.__**





For
      value
      received, _________ hereby sells, assigns and transfers unto
      _______________________ the within Warrant Certificate, together with all right,
      title and interest therein, and does hereby irrevocably constitute and appoint
      _______________________ attorney, to transfer said Warrant Certificate on the
      books of the within-named Company with respect to the number of Warrants set
      forth below, with full power of substitution in the premises:





**Name(s)
                of Assignee(s)**
            
            **Address**
            
            **#
                of Warrants**





And
      if
      said number of Warrants shall not be all the Warrants represented by the Warrant
      Certificate, a new Warrant Certificate is to be issued in the name of said
      undersigned for the balance remaining of the Warrants registered by said Warrant
      Certificate.





Dated:
      __________ , 200_





Signature:
      _____________________





Notice:
      The signature to the foregoing Assignment must correspond to the name as written
      upon the face of this security in every particular, without alteration or any
      change whatsoever; signature(s) must be guaranteed by an eligible guarantor
      institution (banks, stock brokers, savings and loan associations and credit
      unions with membership in an approved signature guarantee medallion program)
      pursuant to Securities and Exchange Commission Rule l7Ad-15.