<PAGE>   1
                                                                    EXHIBIT 4.10

                          MPOWER HOLDING CORPORATION

                      FORM OF CERTIFICATE OF DESIGNATION
                      OF THE VOTING POWERS, DESIGNATION,
                   PREFERENCES AND RELATIVE, PARTICIPATING,
             OPTIONAL OR OTHER SPECIAL RIGHTS AND QUALIFICATIONS,
                     LIMITATIONS AND RESTRICTIONS OF THE
                           SERIES E PREFERRED STOCK


                               ---------------
                         Pursuant to Section 151 of the
                General Corporation Law of the State of Delaware
                               ---------------


                  Mpower Holding Corporation, a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), DOES HEREBY CERTIFY:

                  that, pursuant to authority conferred upon the Board of
Directors of the Corporation by its Certificate of Incorporation, as amended
(the "Certificate"), and, pursuant to the provisions of Section 151 of the
General Corporation Law of the State of Delaware, said Board of Directors, at a
duly called meeting at which a quorum was present and acted throughout,
adopted the following resolutions, which resolutions remain in full force and
effect on the date hereof creating a series of 100,000 shares of Preferred
Stock having a par value of $.001 per share, designated as Series E Preferred
Stock (the "Series E Preferred Stock") out of the class of 50,000,000 shares of
preferred stock of the par value of $.001 per share (the "Preferred Stock"):

                  RESOLVED, that pursuant to the authority vested in the Board
of Directors in accordance with the provisions of the Certificate, the Board of
Directors does hereby create, authorize and provide for the issuance of the
Series E Preferred Stock having the voting powers, designation, relative,
participating, optional and other special rights, preferences, and
qualifications, limitations and restrictions thereof that are set forth as
follows:

                  Section 1. Designation and Amount. The shares of such series
shall be designated as "Series E Preferred Stock" and the number of shares
constituting such series shall be 100,000.

                  Section 2. Dividends and Distributions. (A) Subject to the
prior and superior rights of the holders of any shares of any other series of
Preferred Stock or any other shares of preferred stock of the Corporation
ranking prior and superior to the shares of Series E Preferred Stock with
respect to dividends, each holder of one one-thousandth (1/1,000) of a share (a
"Unit") of Series E Preferred Stock shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available for that
purpose, (i) quarterly dividends payable in cash on the last day of March, June,
September and December in each year (each such date
<PAGE>   2
being a "Quarterly Dividend Payment Date"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of such Unit of Series E
Preferred Stock, in an amount per Unit (rounded to the nearest cent) equal to
the greater of (a) $.01 or (b) subject to the provision for adjustment
hereinafter set forth, the aggregate per share amount of all cash dividends
declared on shares of the Common Stock since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of a Unit of Series E Preferred Stock, and (ii)
subject to the provision for adjustment hereinafter set forth, quarterly
distributions (payable in kind) on each Quarterly Dividend Payment Date in an
amount per Unit equal to the aggregate per share amount of all non-cash
dividends or other distributions (other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common Stock, by
reclassification or otherwise) declared on shares of Common Stock since the
immediately preceding Quarterly Dividend Payment Date, or with respect to the
first Quarterly Dividend Payment Date, since the first issuance of a Unit of
Series E Preferred Stock. In the event that the Corporation shall at any time
after December 11, 2000 (the "Rights Declaration Date") (i) declare any dividend
on outstanding shares of Common Stock payable in shares of Common Stock, (ii)
subdivide outstanding shares of Common Stock or (iii) combine outstanding shares
of Common Stock into smaller number of shares, then in each such case the amount
to which the holder of a Unit of Series E Preferred Stock was entitled
immediately prior to such event pursuant to the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which shall
be the number of shares of Common Stock that are outstanding immediately after
such event and the denominator of which shall be the number of shares of Common
Stock that were outstanding immediately prior to such event.

                  (B) The Corporation shall declare a dividend or distribution
on Units of Series E Preferred Stock as provided in paragraph (A) above
immediately after it declares a dividend or distribution on the shares of Common
Stock (other than a dividend payable in shares of Common Stock); provided,
however, that, in the event no dividend or distribution shall have been declared
on the Common Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $.01
per Unit on the Series E Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.

                  (C) Dividends shall begin to accrue and shall be cumulative on
each outstanding Unit of Series E Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issuance of such Unit of Series E
Preferred Stock, unless the date of issuance of such Unit is prior to the record
date for the first Quarterly Dividend Payment Date, in which case, dividends on
such Unit shall begin to accrue from the date of issuance of such Unit, or
unless the date of issuance is a Quarterly Dividend Payment Date or is a date
after the record date for the determination of holders of Units of Series E
Preferred Stock entitled to receive a quarterly dividend and before such
Quarterly Dividend Payment Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly Dividend Payment Date.
Accrued but unpaid dividends shall not bear interest. Dividends paid on Units of
Series E Preferred Stock in an amount less than the aggregate amount of all such
dividends at the time accrued and payable on such Units shall be allocated pro
rata on a unit-by-unit basis among all Units of Series E Preferred Stock at the
time outstanding. The Board of Directors may fix a record date for the
determination of holders of Units of Series E Preferred Stock entitled to

                                       2
<PAGE>   3
receive a payment of a dividend or distribution declared thereon, which record
date shall be no more than 30 days prior to the date fixed for the payment
thereof.

                  Section 3. Voting Rights. The holders of Units of Series E
Preferred Stock shall have the following voting rights:

                  (A) Subject to the provision for adjustment hereinafter set
forth, each Unit of Series E Preferred Stock shall entitle the holder thereof to
one vote on all matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on outstanding shares of Common Stock
payable in shares of Common Stock, (ii) subdivide outstanding shares of Common
Stock or (iii) combine the outstanding shares of Common Stock into a smaller
number of shares, then in each such case the number of votes per Unit to which
holders of Units of Series E Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying each number by a fraction the
numerator of which shall be the number of shares of Common Stock outstanding
immediately after such event and the denominator of which shall be the number of
shares of Common Stock that were outstanding immediately prior to such event.

                  (B) Except as otherwise provided herein or by law, the holders
of Units of Series E Preferred Stock and the holders of shares of Common Stock
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.

                  (C) (i) If at any time dividends on any Units of Series E
Preferred Stock shall be in arrears in an amount equal to six quarterly
dividends thereon, then during the period (a "default period") from the
occurrence of such event until such time as all accrued and unpaid dividends for
all previous quarterly dividend periods and for the current quarterly dividend
period on all Units of Series E Preferred Stock then outstanding shall have been
declared and paid or set apart for payment, all holders of Units of Series E
Preferred Stock, voting separately as a class, shall have the right to elect two
Directors.

                  (ii) During any default period, such voting rights of the
holders of Units of Series E Preferred Stock may be exercised initially at a
special meeting called pursuant to subparagraph (iii) of this Section 3(C) or at
any annual meeting of stockholders, and thereafter at annual meetings of
stockholders, provided that neither such voting rights nor any right of the
holders of Units of Series E Preferred Stock to increase, in certain cases, the
authorized number of Directors may be exercised at any meeting unless one-third
of the outstanding Units of Preferred Stock shall be present at such meeting in
person or by proxy. The absence of a quorum of the holders of Common Stock shall
not affect the exercise by the holders of Units of Series E Preferred Stock of
such rights. At any meeting at which the holders of Units of Series E Preferred
Stock shall exercise such voting rights initially during an existing default
period, they shall have the right, voting separately as a class, to elect
Directors to fill up to two vacancies in the Board of Directors, if any such
vacancies may then exist, or, if such right is exercised at an annual meeting to
elect two Directors. If the number which may be so elected at any special
meeting does not amount to the required number, the holders of the Series E
Preferred Stock shall have the right to make such increase in the number of
Directors as shall be necessary to permit the election by them of the required
number. After the holders of Units of Series E Preferred Stock shall have
exercised their right to elect Directors during any default period, the

                                       3
<PAGE>   4
number of Directors shall not be increased or decreased except as approved by a
vote o the holders of Units of Series E Preferred Stock as herein provided or
pursuant to the rights of any equity securities ranking senior to the Series E
Preferred Stock.

                  (iii) Unless the holders of the Series E Preferred Stock
shall, during the existing default period, have previously exercised their right
to elect Directors, the Board of Directors may order, or any stockholder or
stockholders owning in the aggregate not less than 25% of the total number of
the Units of Series E Preferred Stock outstanding may request, the calling of a
special meeting of the holders of Units of Series E Preferred Stock, which
meeting shall thereupon be called by the Secretary of the Corporation. Notice of
such meeting and of any annual meeting at which holders of Units of Series E
Preferred Stock are entitled to vote pursuant to this paragraph (C)(iii) shall
be given to each holder of record of Units of Series E Preferred Stock by
mailing a copy of such notice to him at his last address as the same appears on
the books of the Corporation. Such meeting shall be called for a time not
earlier than 20 days and not later than 60 days after such order or request or
in default of the calling of such meeting within 60 days after such order or
request, such meeting may be called on similar notice by any stockholder or
stockholders owning in the aggregate not less than 25% of the total number of
outstanding Units of Series E Preferred Stock. Notwithstanding the provisions of
this paragraph (C)(iii), no such special meeting shall be called during the 60
days immediately preceding the date fixed for the next annual meeting of the
stockholders.

                  (iv) During any default period, the holders of shares of
Common Stock and the Units of Series E Preferred Stock, and other classes or
series of stock of the Corporation, if applicable, shall continue to be entitled
to elect all the Directors until holders of the Units of Series E Preferred
Stock shall have exercised their right to elect two Directors voting as a
separate class, after the exercise of which right (x) the Directors so elected
by the holders of Units of Series E Preferred Stock shall continue in office
until their successors shall have been elected by such holders or until the
expiration of the default period, and (y) any vacancy in the Board of Directors
may (except as provided in paragraph (C)(ii) of this Section 3) be filled by
vote of a majority of the remaining Directors theretofore elected by the holders
of the class of capital stock which elected the Director whose office shall have
become vacant. References in this paragraph (C) to Directors elected by the
holders of a particular class of capital stock shall include Directors elected
by such Directors to fill vacancies as provided in clause (y) of the foregoing
sentence.

                  (v) Immediately upon the expiration of a default period, (x)
the right of the holders of Units of Series E Preferred Stock as a separate
class to elect Directors shall cease, (y) the term of any Directors elected by
the holders of Units of Series E Preferred Stock as a separate class shall
terminate, and (z) the number of Directors shall be such number as may be
provided for in the Certificate or by-laws irrespective of any increase made
pursuant to the provisions of paragraph (C)(ii) of this Section 3 (such number
being subject, however, to change thereafter in any manner provided by law or in
the Certificate or by-laws). Any vacancies in the Board of Directors effected by
the provisions of clauses (y) and (z) in the preceding sentence may be filled by
a majority of the remaining Directors.

                  (vi) The provisions of this paragraph (C) shall govern the
election of Directors by holders of Units of Preferred Stock during any default
period notwithstanding any provisions

                                       4
<PAGE>   5
of the Certificate to the contrary, including, without limitation, the
provisions of Article Six of the Certificate.

                  (D) Except as set forth herein, holders of Units of Series E
Preferred Stock shall have no special voting rights and their consents shall not
be required (except to the extent they are entitled to vote with holders of
shares of Common Stock as set forth herein) for taking any corporate action.

                  Section 4. Certain Restrictions. (A) Whenever quarterly
dividends or other dividends or distributions payable on Units of Series E
Preferred Stock as provided in Section 2 are in arrears, thereafter and until
all accrued and unpaid dividends and distributions, whether or not declared, on
outstanding Units of Series E Preferred Stock shall have been paid in full, the
Corporation shall not

                  (i) declare or pay dividends on, make any other distributions
         on, or redeem or purchase or otherwise acquire for consideration any
         shares of junior stock;

                  (ii) declare or pay dividends on or make any other
         distributions on any shares of parity stock, except dividends paid
         ratably on Units of Series E Preferred Stock and shares of all such
         parity stock on which dividends are payable or in arrears in proportion
         to the total amounts to which the holders of such Units and all such
         shares are then entitled;

                  (iii) redeem or purchase or otherwise acquire for
         consideration shares of any parity stock, provided, however, that the
         corporation may at any time redeem, purchase or otherwise acquire
         shares of any such parity stock in exchange for shares of any junior
         stock;

                  (iv) purchase or otherwise acquire for consideration any Units
         of Series E Preferred Stock, except in accordance with a purchase offer
         made in writing or by publication (as determined by the Board of
         Directors) to all holders of such Units.

                  (B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquired for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.

                  Section 5. Reacquired Shares. Any Units of Series E Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such Units shall, upon their cancellation, become authorized but
unissued Units of Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.

                  Section 6. Liquidation, Dissolution or Winding Up. (A) Upon
any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (i) to the holders of shares of
junior stock unless the holders of Units of Series E Preferred Stock shall have
received, subject to adjustment as hereinafter provided in paragraph (B), the

                                       5
<PAGE>   6
greater of either (a) $.01 per Unit plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not earned or declared, to the
date of such payment, or (b) the amount equal to the aggregate per share amount
to be distributed to holders of shares of Common Stock, or (ii) to the holders
of shares of parity stock, unless simultaneously therewith distributions are
made ratably on Units of Series E Preferred Stock and all other shares of such
parity stock in proportion to the total amounts to which the holders of Units of
Series E Preferred Stock are entitled under clause (i)(a) of this sentence and
to which the holders of shares of such parity stock are entitled, in each case
upon such liquidation, dissolution or winding up.

                  (B) In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on outstanding shares of Common
Stock payable in shares of Common Stock, (ii) subdivide outstanding shares of
Common Stock, or (iii) combine outstanding shares of Common Stock into a smaller
number of shares, then in each such case the aggregate amount to which holders
of Units of Series E Preferred Stock were entitled immediately prior to such
event pursuant to clause (i)(b) of paragraph (A) of this Section 6 shall be
adjusted by multiplying such amount by a fraction the numerator of which shall
be the number of shares of Common Stock that are outstanding immediately after
such event and the denominator of which shall be the number of shares of Common
Stock that were outstanding immediately prior to such event.

                  Section 7. Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other transaction in
which the shares of common stock are exchanged for or converted into other stock
or securities, cash and/or any other property, then in any such case Units of
Series E Preferred Stock shall at the same time be similarly exchanged for or
converted into an amount per Unit (subject to the provision for adjustment
hereinafter set forth) equal to the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is converted or exchanged. In the event the
Corporation shall at any time after the Rights Declaration Date (i) declare any
dividend on outstanding shares of Common Stock payable in shares of Common
Stock, (ii) subdivide outstanding shares of Common Stock, or (iii) combine
outstanding Common Stock into a smaller number of shares, then in each such case
the amount set forth in the immediately preceding sentence with respect to the
exchange or conversion of Units of Series E Preferred Stock shall be adjusted by
multiplying such amount by a fraction the numerator of which shall be the number
of shares of Common Stock that are outstanding immediately after such event and
the denominator of which shall be the number of shares of Common Stock that were
outstanding immediately prior to such event.

                  Section 8. Redemption. The Units of Series E Preferred Stock
shall not be redeemable.

                  Section 9. Ranking. The Units of Series E Preferred Stock
shall rank junior to all other series of the Preferred Stock and to any other
class of preferred stock that hereafter may be issued by the Corporation as to
the payment of dividends and the distribution of assets, unless the terms of any
such series or class shall provide otherwise.

                  Section 10. Amendment. The Certificate, including, without
limitation, this resolution, shall not hereafter be amended, either directly or
indirectly, or through merger or

                                       6
<PAGE>   7
consolidation with another corporation in any manner that would alter or change
the powers, preferences or special rights of the Series E Preferred Stock so as
to affect them adversely without the affirmative vote of the holders of a
majority or more of the outstanding Units of Series E Preferred Stock, voting
separately as a class.

                  Section 11. Fractional Shares. The Series E Preferred Stock
may be issued in Units or other fractions of a share, which Units or fractions
shall entitle the holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in distributions and to
have the benefit of all other rights of holders of Series E Preferred Stock.

                  Section 12. Certain Definitions. As used herein with respect
to the Series E Preferred Stock, the following terms shall have the following
meanings:

                  (A) The term "Common Stock" shall mean the class of stock
designated as the common stock, par value $.001 per share, of the Corporation at
the date hereof or any other class of stock resulting from successive changes or
reclassification of such common stock.

                  (B) The term "junior stock" (i) as used in Section 4, shall
mean the Common Stock and any other class or series of capital stock of the
Corporation hereafter authorized or issued over which the Series E Preferred
Stock has preference or priority as to the payment of dividends and (ii) as used
in Section 6, shall mean the Common Stock and any other class or series of
capital stock of the Corporation over which the Series E Preferred Stock has
preference or priority in the distribution of assets on any liquidation,
dissolution or winding up of the Corporation.

                  (C) The term "parity stock" (i) as used in Section 4, shall
mean any class or series of stock of the Corporation hereafter authorized or
issued ranking pari passu with the Series E Preferred Stock as to the payment of
dividends and (ii) as used in Section 6, shall mean any class or series of
capital stock ranking pari passu with the Series E Preferred Stock in the
distribution of assets on any liquidation, dissolution or winding up of the
Corporation.

                                       7
<PAGE>   8
                  IN WITNESS WHEREOF, Mpower Holding Corporation has caused this
Certificate to be signed by its President and attested by its Secretary this
_____ day of ___________, 2001.

                                         MPOWER HOLDING CORPORATION


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



ATTEST:                                  Sworn to this ___ day of ________, 2001


By                                       By
  --------------------------------         ------------------------------------
   Name:                                              Notary Public
   Title:   Secretary


                                       8