Document:

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                                                                  Exhibit 4.12.5

THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT") OR ANY STATE SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE
EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (ii)
AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATIONS ARE NOT REQUIRED, (iii) RECEIPT OF A NO-ACTION LETTER
FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH
THE PROVISIONS OF SECTION 7 OF THIS WARRANT.

                                 June 29, 1999

                         CONCENTRIC NETWORK CORPORATION

                         COMMON STOCK PURCHASE WARRANT

     THIS CERTIFIES THAT, for value received, Micosoft Corporation, is entitled
to subscribe for and purchase, subject to the provisions and upon the terms and
conditions hereinafter set forth, 500,000 fully paid and nonassessable shares of
Common Stock of Concentric Network Corporation, a Delaware corporation (the
"Company"). The shares (as defined below) shall be purchasable at a per share
purchase price equal to $33.27 (such price and such other price as shall result,
from time to time, from the adjustments specified in Section 4 hereof is herein
referred to as the "Warrant Price"). As used herein, (a) the term "Date of
Grant" shall mean June 29, 1999, and (b) the term "Shares" shall mean the Common
Stock to be issued by the Company hereunder and any stock into or for which any
such Common Stock may hereafter be converted or exchanged.

     1.   TERM.     The purchase right represented by this Warrant is
exercisable, in whole or in part, at any time and from time to time from the
Date of Grant through the earliest to occur of four years after the Date of
Grant. If during such term there is any consolidation or merger of the Company,
or any successor, with or into any entity, or any other corporate reorganization
in which the Company, or any successor, shall not be the continuing or surviving
entity of such consolidation, merger or reorganization or any transaction, any
series of related transactions in which in excess of 50% of the voting power of
Company, or any successor, is transferred, or any sale of all or substantially
all of the assets of the Company or any successor, adequate provision shall be
made as a part of such transaction for the assumption of this Warrant and the
full preservation of the economic benefits inherent in this Warrant. In the
event of any such transaction a replacement Warrant shall be promptly issued to
the then holder of this Warrant.

     2.   METHOD OF EXERCISE; PAYMENT; ISSUANCE OF NEW WARRANT.  Subject to
Section 1 hereof, the purchase right represented by this Warrant may be
exercised by the holder hereof, in whole or in part and from time to time, at
the election of the holder hereof, by (a) the surrender of this Warrant (with
the notice of exercise substantially in the form attached hereto as EXHIBIT A-1
duly completed and executed) at the principal office of the Company and by the
payment to the Company, by certified

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or bank check, or by Wire Transfer to an account designated by the Company (a
"Wire Transfer") of an amount equal to the then applicable Warrant Price
multiplied by the number of Shares then being purchased, or by net exercise in
accordance with Section 9, and (b) the delivery of a duly executed Investor
Representation Statement in the form attached hereto as Exhibit A-2. The person
or persons in whose name(s) any certificate(s) representing the Shares shall be
issuable upon exercise of this Warrant shall be deemed to have become the
holder(s) of record of, and shall be treated for all purposes as the record
holder(s) of, the shares represented thereby (and such shares shall be deemed to
have been issued) immediately prior to the close of business on the date or
dates upon which this Warrant is exercised. In the event of any exercise of the
rights represented by this Warrant, certificates for the shares of stock so
purchased shall be delivered to the holder hereof as soon as possible and in any
event within thirty (30) days after such exercise and, unless this Warrant has
been fully exercised or expired, a new Warrant representing the portion of the
Shares, if any, with respect to which this Warrant shall not then have been
exercised shall also be issued to the holder hereof as soon as possible and in
any event within such thirty-day period.

     3.   Stock Fully Paid: Reservation of Shares.  All shares that may be
issued upon the exercise of the rights represented by this Warrant will, upon
issuance pursuant to the terms and conditions herein, be fully paid and
nonassessable, and free from all taxes, liens, and charges with respect to the
issue thereof. During the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized, and
reserved for the purpose of the issue upon exercise of the purchase rights
evidenced by this Warrant, a sufficient number of shares of its capital stock to
provide for the exercise of the rights represented by this Warrant.

     4.   Adjustment of Warrant Price and Number of Shares. The number and kind
of securities purchasable upon the exercise of this Warrant and the Warrant
Price shall be subject to adjustment from time to time upon the occurrence of
certain events, as follows:

          (a)  Reclassification.  In case of any reclassification or change of
securities of the class issuable upon exercise of this Warrant (other than a
change in par value, or from par value to no par value, or from no par value to
par value, or as a result of a subdivision or combination), the Company shall
duly execute and deliver to the holder of this Warrant a new Warrant (in form
and substance reasonably satisfactory to the holder of this Warrant), so that
the holder of this Warrant shall have the right to receive, at a total purchase
price not to exceed that payable upon the exercise of the unexercised portion of
this Warrant, and in lieu of the Shares theretofore issuable upon exercise of
this Warrant, the kind and amount of shares of stock, other securities, money
and property receivable upon such reclassification or change by a holder of the
number of Shares then purchasable under this Warrant. Such new Warrant shall
provide for adjustments that shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 4. The provisions of this
subparagraph (a) shall similarly apply to successive reclassifications or
changes.

          (b)  Subdivision or Combination of Shares.  If the Company at any time
while this Warrant remains outstanding and unexpired shall subdivide or combine
its outstanding shares of capital stock into which this Warrant is exercisable,
the Warrant Price shall be proportionately decreased in the case of a
subdivision or increased in the case of a combination, effective at the close of
business on the date the subdivision or combination becomes effective.

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          (c)  Stock Dividends and Other Distributions. If the Company at any
time while this Warrant is outstanding and unexpired shall (i) pay a dividend
with respect to its common stock issuable hereunder payable in the same class or
series of capital stock, or (ii) make any other distribution of common stock
with respect to its common stock (except any distribution specifically provided
for in Sections 4(a) and 4(b)), then the Warrant Price shall be adjusted, from
and after the date of determination of shareholders entitled to receive such
dividend or distribution, to that price determined by multiplying the Warrant
Price in effect immediately prior to such date of determination by a fraction
(i) the numerator of which shall be the total number of shares of the applicable
class or series of capital stock outstanding immediately prior to such dividend
or distribution, and (ii) the denominator of which shall be the total number of
shares of such class or series of capital stock outstanding immediately after
such dividend or distribution.

          (d)  Adjustment of Number of Shares. Upon each adjustment in the
Warrant Price, the number of Shares purchasable hereunder shall be adjusted, to
the nearest whole share, to the product obtained by multiplying the number of
Shares purchasable immediately prior to such adjustment in the Warrant Price by
a fraction, the numerator of which shall be the Warrant Price immediately prior
to such adjustment and the denominator of which shall be the Warrant Price
immediately thereafter.

     5.   Notice of Adjustments. Whenever the Warrant Price or the number of
Shares purchasable hereunder shall be adjusted pursuant to Section 4 hereof,
the Company shall make a certificate signed by its chief financial officer
setting forth, in reasonable detail, the event requiring the adjustment, and
the Warrant Price and the number of Shares purchasable hereunder after giving
effect to such adjustment, and shall cause copies of such certificate to be
mailed (without regard to Section 12 hereof, by first class mail, postage
prepaid) to the holder of this Warrant at such holder's last known address.

     6.   Fractional Shares. No fractional Shares will be issued in connection
with any exercise hereunder, but in lieu of such fractional shares the Company
shall make a cash payment therefor based on the fair market value of the Shares
on the date of exercise as reasonably determined in good faith by the Company's
Board of Directors.

     7.   Compliance with Act; Disposition of Warrant or Shares.

          (a)  Compliance with Act. The holder of this Warrant, by acceptance
hereof, agrees that this Warrant, and the Shares to be issued upon exercise
hereof are being acquired for investment and that such holder will not offer,
sell or otherwise dispose of this Warrant, or any Shares except under
circumstances which will not result in a violation of the Securities Act of
1933 (the "Act") or any applicable state securities laws. Upon exercise of this
Warrant, unless the Shares being acquired are registered under the Act and any
applicable state securities laws or an exemption from such registration is
available, the holder hereof shall confirm in writing that the Shares so
purchased are being acquired for investment and not with a view toward
distribution or resale in violation of the Act and shall confirm such other
matters related thereto as may be reasonably requested by the Company. This
Warrant and all Shares issued upon exercise of this Warrant (unless registered
under

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the Act and any applicable state securities laws) shall be stamped or imprinted
with a legend in substantially the following form:

     "THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
     SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NO SALE
     OR DISPOSITION MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION
     STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER EVIDENCE,
     REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION ARE NOT
     REQUIRED, (iii) RECEIPT OF AN NO-ACTION LETTERS FROM THE APPROPRIATE
     GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH THE PROVISIONS
     OF SECTION 7 OF THE WARRANT UNDER WHICH THESE SECURITIES WERE ISSUED,
     DIRECTLY OR INDIRECTLY."

     Said legend shall be removed by the Company, upon the request of a holder,
at such time as the restrictions on the transfer of the applicable security
shall have terminated. In addition, in connection with the issuance of this
Warrant, the holder specifically represents to the Company by acceptance of
this Warrant as follows:

          (1)  The holder is aware of the Company's business affairs and
financial condition, and has acquired information about the Company sufficient
to reach an informed and knowledgeable decision to acquire this Warrant. The
holder is acquiring this Warrant for its own account for investment purposes
only and not with a view to, or for the resale in connection with, any
"distribution" thereof in violation of the Act.

          (2)  The holder understands that this Warrant has not been registered
under the Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of the holder's
investment intent as expressed herein.

          (3)  The holder further understands that this Warrant must be held
indefinitely unless subsequently registered under the Act and qualified under
any applicable state securities laws, or unless exemptions from registration
and qualification are otherwise available. The holder is aware of the
provisions of Rule 144, promulgated under the Act.

     (b)  Disposition of Warrant or Shares.  With respect to any offer, sale or
other disposition of this Warrant or any Shares acquired pursuant to the
exercise of this Warrant prior to registration of such Warrant or Shares, the
holder hereof agrees until the expiration applicable holding period as provided
for in Rule 144(k) to give written notice to the Company prior thereto,
describing briefly the manner thereof, together with a written opinion of such
holder's counsel, or other evidence, if reasonably requested by the Company, to
the effect that such offer, sale or other disposition may be effected without
registration or qualification (under the Act as then in effect or any federal or
state securities law then in effect) of this Warrant or the Shares and
indicating whether or not under the Act certificates for this Warrant or the
Shares to be sold or otherwise disposed of require any restrictive legend as to
applicable restrictions on transferability in order to ensure

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compliance with such law. Promptly upon receiving such written notice and
reasonably satisfactory opinion or other evidence, if so requested, the
Company, as promptly as practicable but no later than fifteen (15) days after
receipt of the written notice, shall notify such holder that such holder may
sell or otherwise dispose of this Warrant or such Shares, all in accordance
with the terms of the notice delivered to the Company. If a determination has
been made pursuant to this Section 7(b) that the opinion of counsel for the
holder or other evidence is not reasonably satisfactory to the Company, the
Company shall so notify the holder promptly with details thereof after such
determination has been made. Notwithstanding the foregoing, this Warrant or
such Shares may, as to such federal laws, be offered, sold or otherwise
disposed of in accordance with Rule 144 or 144A under the Act, provided that
the Company shall have been furnished with such information as the Company may
reasonably request to provide a reasonable assurance that the provisions of
Rule 144 or 144A have been satisfied. Each certificate representing this
Warrant or the Shares thus transferred (except a transfer pursuant to Rule 144
or 144A) shall bear a legend as to the applicable restrictions on
transferability in order to ensure compliance with such laws, unless in the
aforesaid opinion of counsel for the holder, such legend is not required in
order to ensure compliance with such laws. The Company may issue stop transfer
instructions to its transfer agent in connection with such restrictions.

          (e)  Applicability of Restrictions. Neither any restrictions of any
legend described in this Warrant nor the requirements of Section 7(b) above
shall apply to any transfer or grant of a security interest in this Warrant (or
the Shares obtainable upon exercise thereof) or any part hereof (i) to a
partner of the holder if the holder is a partnership, or (ii) to a partnership
of which the holder is a partner; provided however, in any such transfer, if
applicable, the transferee shall agree in writing to be bound by the terms of
this Warrant as if an original signatory hereto.

     8.   Rights as Shareholders; Information. No holder of this Warrant, as
such, shall be entitled to vote or receive dividends or be deemed the holder of
Shares, nor shall anything contained herein be construed to confer upon the
holder of this Warrant, as such, any of the rights of a shareholder of the
Company or any right to vote for the election of directors or upon any matter
submitted to shareholders at any meeting thereof, or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until
this Warrant shall have been exercised and the Shares purchasable upon the
exercise hereof shall have become deliverable, as provided herein.
Notwithstanding the foregoing, the Company will transmit to the holder of this
Warrant such information, documents and reports as are generally distributed to
the holders of any class or series of the securities of the Company
concurrently with the distribution thereof to the shareholders.

     9.   Right to Convert Warrant into Stock Net Issuance. The registered
holder hereof shall have the right to convert this Warrant, in whole, at any
time at or prior to the expiration of the Warrant pursuant to Section 1 hereof,
by the surrender of this Warrant and the notice of exercise form attached
hereto duly executed to the principal office of the Company, into Shares as
provided in this Section 9. Upon exercise of this conversion right, the holder
hereof shall be entitled to receive that number of Shares of the Company (y)
equal to the quotient obtained by dividing ((A - B)(X)) by (A), where:

          A.   =    the Fair Market Value (as defined below) of one Share on the
                    date of conversion of this Warrant.

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          B = the Warrant Price for one Share under this Warrant.

          X = the number of Shares as to which this Warrant is being converted.

     If the above calculation results in a number equal to or less than zero,
then no Shares shall be issued or issuable upon conversion of this Warrant.

     "Fair Market Value" of a Share shall mean:

          (a)  The average closing price of the Company's common stock quoted on
the Nasdaq National Market or, if the Company's common stock is not quoted on
the Nasdaq National Market, the average closing price quoted on any exchange on
which the Company's common stock is listed, whichever is applicable, for the
last twenty-five (25) trading days prior to the date of delivery of the notice
pursuant to this Section 9; or

          (b)  If the Company's common stock is not traded on an exchange, the
Fair Market Value shall be determined in good faith by the Company's Board of
Directors based on the Company's most recent sale of common or preferred stock.

     Upon conversion of this Warrant in accordance with this Section 9, the
registered holder hereof shall be entitled to receive a certificate for the
number of Shares determined in accordance with the foregoing.

     10.  Representations and Warranties.  The Company represents and warrants
to the holder of this Warrant as follows:

          (a)  This Warrant has been duly authorized and executed by the Company
and is a valid and binding obligation of the Company enforceable in accordance
with its terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and the rules of law or principles at
equity governing specific performance, injunctive relief and other equitable
remedies;

          (b)  The Shares have been, or will be duly authorized and reserved for
issuance by the Company and, when issued in accordance with the terms hereof
will be validly issued, fully paid and non-assessable.

     11.  Covenant Not To Transfer Warrant or Shares.  The holder of this
Warrant agrees not to offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, or otherwise transfer or dispose of, directly or
indirectly the Warrant or any of the Shares or any securities convertible into
or exercisable or exchangeable for the Warrant or the Shares (whether such
shares or any such securities are now owned by the undersigned or are hereafter
acquired), for 545 days following the date hereof, provided that the holder of
this Warrant may sell the Warrant or the Share or any other securities of the
Company without regard to the provisions of this Section 11 if (i) a tender or
exchange offer is made (as evidenced by the filing with the SEC of a Schedule
14D-1 (if applicable, or any successor form promulgated or adopted for such
purpose by the SEC) and the actual dissemination of tender offer materials to
security holders) by another person, entity or group to purchase or exchange for

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<PAGE>   7
cash or other consideration any shares of Common Stock or rights, warrants or
options therefor which, if successful, would result in such person, entity or
group beneficially owning or having the right to acquire more than a majority
of the voting shares of the Company; (ii) in the event of a sale of
substantially all assets of the Company or a merger, consolidation or other
transaction, as a result of which the stockholders of the Company as of
immediately prior to such transaction hold less than 50% of the voting
securities of the surviving entity following such transaction (collectively, a
"Transaction"), upon the earlier of (x) the public announcement or disclosure
or (y) consummation of a Transaction or (iii) such sale is to a person or
entity that directly, or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under common control with, the holder of
this Warrant. Notwithstanding the foregoing or anything else to the contrary in
this Warrant, the holder may enter into bona fide transactions through a
nationally recognized investment banking firm which constitute a hedge against
changes in the market price of the Common Stock, provided, however, no public
disclosure is made with respect to such hedge transactions, except in an
initial filing pursuant to Section 13 of the Exchange Act, if required, the text
of which is reasonably satisfactory to the Company, or if in the opinion of
counsel to holder such disclosure is required as a matter of law.

     12.  Modification and Waiver. This Warrant and any provision hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.

     13. Notices. Any notice, request, communication or other document required
or permitted to be given or delivered to the holder hereof or the Company shall
be delivered, or shall be sent by certified or registered mail, postage
prepaid, to each such holder at its address as shown on the books of the
Company or to the Company at the address indicated therefor on the signature
page of this Warrant.

     14. Lost Warrants or Stock Certificates. The Company covenants to the
holder hereof that, upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant or any
stock certificate and, in the case of any such loss, theft or destruction, upon
receipt of an indemnity reasonably satisfactory to the Company, or in the case
of any such mutilation upon surrender and cancellation of such Warrant or stock
certificate, the Company will make and deliver a new Warrant or stock
certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated
Warrant or stock certificate.

     15. Descriptive Headings. The descriptive headings of the several
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. The language in this Warrant shall be
construed as to its fair meaning without regard to which party drafted this
Warrant.

     16. Governing Law. This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws
of the State of Delaware.

     17. Severability. The invalidity or unenforceability of any provision of
this Warrant in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction, or affect any other
provision of this Warrant, which shall remain in full force and effect.

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<PAGE>   8
     18. Entire Agreement: Modification. This Warrant constitutes the entire
agreement between the parties pertaining to the subject matter contained in it
and supersedes all prior and contemporaneous agreements, representations, and
undertakings of the parties, whether oral or written, with respect to such
subject matter.

                                   CONCENTRIC NETWORK CORPORATION
                                   a Delaware corporation

                                   By: /s/ Michael Anthofer
                                   Name: Michael Anthofer
                                   Title: SVP & CFO
                                   Address: 1400 Parkmoor Ave., San Jose 95126

                                       8

<PAGE>   9
                                  EXHIBIT A-1

                               NOTICE OF EXERCISE

     To: CONCENTRIC NETWORK CORPORATION (the "Company")

     1.   The undersigned hereby:

          [ ]  elects to purchase            shares of Common Stock of the
               Company pursuant to the terms of the attached Warrant, and
               tenders herewith payment of the purchase price of such shares in
               full; or

          [ ]  elects to exercise its net issuance rights pursuant to Section 9
               of the attached Warrant with respect to            shares of
               Common Stock.

     2.   Please issue a certificate or certificates representing said shares
in the name of the undersigned or in such other name or names as are specified
below:

                                        ----------------------------------------
                                        (Name)

                                        ----------------------------------------
                                        (Address)

                                        ----------------------------------------
                                        (Address)

     3.   The undersigned represents that the aforesaid shares being acquired
for the account of the undersigned for investment and not with a view to, or for
resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares, all except as in
compliance with applicable securities laws.

------------
   (Date)

                                        ----------------------------------------
                                                      (Signature)
<PAGE>   10
                                 EXHIBIT A-2

                     INVESTMENT REPRESENTATION STATEMENT

PURCHASER:

COMPANY:

SECURITY:

AMOUNT:

DATE:

     In connection with the purchase of the above-listed securities (the
"Securities"), I, the Purchaser, represent to the Company the following:

          (a)  I am aware of the Company's business affairs and financial
condition, and have acquired sufficient information about the Company to reach
an informed and knowledgeable decision to acquire the Securities. I am
purchasing these Securities for my own account for investment purposes only and
not with a view to, or for the resale in connection with, any "distribution"
thereof for purposes of the Securities Act of 1933 ("Securities Act").

          (b)  I understand that the Securities have not been registered under
the Securities Act in reliance upon a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of my
investment intent as expressed herein. In this connection, I understand that,
in the view of the Securities and Exchange Commission ("SEC"), the statutory
basis for such exemption may be unavailable if my representation was predicated
solely upon a present intention to hold these Securities for the minimum
capital gains period specified under tax statutes, for a deferred sale, for or
until an increase or decrease in the market price of the Securities, or for a
period of one year or any other fixed period in the future.

          (c)  I further understand that the Securities must be held
indefinitely unless subsequently registered under the Securities Act or unless
an exemption from registration is otherwise available. Moreover, I understand
that the Company is under no obligation to register the Securities. In addition,
I understand that the certificate evidencing the Securities will be imprinted
with a legend which prohibits the transfer of the Securities unless they are
registered or such registration is not required in the opinion of counsel for
the Company.

          (d)  I am aware of the provisions of Rule 144, promulgated under the
Securities Act, which, in substance, permits limited public resale of
"restricted securities" acquired, directly or

<PAGE>   11
indirectly, from the issuer thereof (or from an affiliate of such issuer), in a
non-public offering subject to the satisfaction of certain conditions.

   (e)  I further understand that at the time I wish to sell the Securities,
there may be no public market upon which to make such a sale.

   (f)  I further understand that in the event all of the requirements of Rule
144 are not satisfied, registration under the Securities Act, compliance with
Regulation A, or some other registration exemption will be required; and that,
notwithstanding the fact that Rule 144 is not exclusive, the Staff of the SEC
has expressed its opinion that persons proposing to sell private placement
securities other than in a registered offering and otherwise than pursuant to
Rule 144 will have a substantial burden of proof in establishing that an
exemption from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such transactions do so
at their own risk.

                                       -----------------------------------------
                                       Name of Purchaser

                                       -----------------------------------------
                                       Signature of Authorized Signatory

                                       -----------------------------------------
                                       Print Name and Title

                                       -----------------------------------------
                                       Date

                                      -2-<PAGE>   1

                                                                  EXHIBIT 10.1.1

                          NEXTLINK COMMUNICATIONS, INC.
                                STOCK OPTION PLAN
     (as amended on September 30, 1997, December 31, 1997, February 5, 1998,
       February 4, 1999, May 3, 1999, October 19, 1999, February 16, 2000
                                and May 24, 2000)

       SECTION 1. Purpose. The purpose of this Stock Option Plan (this "Plan")
is to provide a means whereby Nextlink Communications, Inc. (the "Company") or
any parent or subsidiary of the Company, as defined in Subsection 5.9 (the
"related entities"), may continue to attract, motivate and retain selected
employees, officers and independent contractors who can materially contribute to
the Company's growth and success, and to encourage stock ownership in the
Company through granting incentive stock options or nonqualified stock options,
or both, to purchase the Class A Common Stock of the Company (as defined in
Section 3), so that such key employees and other persons and entities will more
closely identify their interests with those of the Company and its shareholders.
In addition, options under this Plan may serve as replacement options for
options issued under the Equity Option Plan sponsored by the Company's
predecessor.

       SECTION 2. Administration. This Plan shall be administered by the Board
of Directors of the Company (the "Board") or, in the event the Board shall
appoint or authorize a committee to administer this Plan, by such committee. The
administrator of this Plan shall hereinafter be referred to as the "Plan
Administrator."

              2.1 Procedures. The Board may designate one of the members of the
Plan Administrator as chairperson. The Plan Administrator may hold meetings at
such times and places as it shall determine. The acts of a majority of the
members of the Plan Administrator present at meetings at which a quorum exists,
or acts reduced to or approved in writing by all Plan Administrator members,
shall be valid acts of the Plan Administrator.

              2.2 Responsibilities. Except for the terms and conditions
explicitly required in this Plan, the Plan Administrator shall have the
authority, in its discretion, to determine all matters relating to the options
to be granted under this Plan, including selection of the individuals to be
granted options, the number of shares to be subject to each option, the exercise
price, and all other terms and conditions of the options. Grants under this Plan
need not be identical in any respect, even when made simultaneously. The
interpretation and construction by the Plan Administrator of any terms or
provisions of this Plan or any option issued under this Plan, or of any rule or
regulation promulgated in connection with this Plan, shall be conclusive and
binding on all interested parties, so long as such interpretation and
construction with respect to incentive stock options correspond to the
requirements of Section 422 of the Internal Revenue Code (the "Code"), as
amended, and the regulations thereunder.

              2.3 Section 16(b) Compliance and Bifurcation of Plan. In the event
the Company registers any of its equity securities pursuant to Section 12(b) or
12(g) of the Exchange Act, it is the intention of the Company that this Plan,
and options granted under this Plan, comply in all respects with Rule 16b-3
under the Exchange Act and, if any Plan provision is later found not to be in
compliance with such Section, the provision shall be deemed null and void, and
in all

Page 1-STOCK OPTION PLAN

<PAGE>   2

events this Plan shall be construed in favor of its meeting the requirements of
Rule 16b-3. Notwithstanding anything in this Plan to the contrary, the Board, in
its absolute discretion, may bifurcate this Plan so as to restrict, limit or
condition the use of any provision of this Plan to participants who are officers
and directors subject to Section 16(b) of the Exchange Act without so
restricting, limiting or conditioning other Plan participants.

       SECTION 3. Stock Subject to This Plan. The stock subject to this Plan
shall be the Company's Class A Common Stock (the "Class A Common Stock"),
presently authorized but unissued or now held or subsequently acquired by the
Company as treasury shares. Subject to adjustment as provided in Section 7 of
this Plan, the aggregate amount of Class A Common Stock to be delivered upon the
exercise of all options granted under this Plan shall not exceed 51,500,000
shares (the "Plan Maximum") as such Class A Common Stock was constituted on the
effective date of this Plan. If any option granted under this Plan expires or is
surrendered, canceled, terminated or exchanged for another option for any reason
without having been exercised in full, the unpurchased shares subject to such
option shall again be available for purposes of this Plan, including use as
replacement options that may be granted in exchange for such surrendered,
canceled or terminated options.

       SECTION 4. Eligibility. An incentive stock option may be granted only to
an individual who, at the time the option is granted, is an employee of the
Company (or a corporate related entity, as described in Section 5.9) and who the
Board may from time to time select for participation in this Plan. Members of
the Board shall not be eligible for grants of incentive stock options unless
they are also employees of the Company. At the discretion of the Plan
Administrator, employees and independent contractors of the Company (including
nonemployee directors) or any related entity may receive nonqualified stock
options. Notwithstanding anything to the contrary herein, the maximum number of
shares of Class A Common Stock with respect to which options may be granted to
any individual in any calendar year shall not exceed the Plan Maximum, as such
number may change from time to time. Any party to whom an option is granted
under this Plan shall be referred to in this Plan as an "Optionee."

       SECTION 5. Terms and Conditions of Options. Options granted under this
Plan shall be evidenced by written agreements that contain such terms,
conditions, limitations and restrictions as the Plan Administrator shall deem
advisable and which are not inconsistent with this Plan. Notwithstanding the
foregoing, options shall include or incorporate by reference the following terms
and conditions:

              5.1 Number of Shares. The maximum number of shares that may be
purchased pursuant to the exercise of each option, which number shall be as
established by the Plan Administrator.

              5.2 Price of Shares. The price per share at which each option is
exercisable (the "exercise price") shall be as established by the Plan
Administrator, provided that the Plan Administrator shall act in good faith to
establish the exercise price as follows:

                     5.2.1 Incentive Stock Options and Nonqualified Stock
Options. With respect to incentive stock options intended to qualify under
Section 422 of the Code, and subject

Page 2-STOCK OPTION PLAN

<PAGE>   3

to Subsection 5.2.2 below, the exercise price shall be not less than the fair
market value per share of the Class A Common Stock at the time the option is
granted, except with respect to the substitution of a new option for an old
option, or an assumption of an old option, in accordance with Code Section
424(a). With respect to nonqualified stock options, the exercise price shall be
the amount set by the Plan Administrator.

                     5.2.2 Incentive Stock Options to Greater than 10%
Shareholders. With respect to incentive stock options granted to greater than
10% shareholders of the Company, the exercise price shall be as required by
Section 6.

                     5.2.3 Fair Market Value. The fair market value per share of
the Class A Common Stock for the purpose of determining the exercise price under
this Section 5.2 shall be determined as follows:

                     (a)    if the Common Stock is listed on any established
stock exchange or a national market system including without limitation the
National Market System of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, the fair market value shall be the
closing sales price for such stock (or the closing bid, if no sales were
reported), as quoted on such system or exchange for the last market trading date
prior to the time of determination as reported in The Wall Street Journal or
such other source as the Plan Administrator deems reliable;

                     (b)    if the Common Stock is quoted on the NASDAQ System
(but not on the National Market System thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, the fair
market value shall be the mean between the high and low asked prices for the
Common Stock on the last market trading date prior to the day of determination,
as reported in The Wall Street Journal or such other source as the Plan
Administrator deems reliable; or

                     (c)    In the absence of an established market for the
Common Stock, fair market value shall be determined by the Plan Administrator in
good faith at the time the option is granted.

              5.3 Term and Maturity. Subject to the restrictions contained in
Section 6 with respect to granting incentive stock options to greater than 10%
shareholders of the Company, the term of each incentive stock option shall be 10
years from the date it is granted unless a shorter period of time is established
by the Plan Administrator, but in no event shall the term of any incentive stock
option exceed 10 years. The term of each nonqualified stock option shall be 15
years from the date it is granted, unless a shorter period of time is
established by the Plan Administrator in the individual option agreement.

       To ensure that the Company or related entities will achieve the purpose
and receive the benefits contemplated in this Plan, any option granted under
this Plan on or before June 15, 2000 shall, unless this condition is waived or
modified by the Plan Administrator in the agreement evidencing the option, or by
subsequent resolution of the Plan Administrator, be exercisable according to the
following schedule:

Page 3-STOCK OPTION PLAN

<PAGE>   4

<TABLE>
<CAPTION>
Period of Optionee's Continuous Relationship With the Company or Related Entity                             Portion of Total Option
                      from the Date the Option is Granted                                                     Which is Exercisable
<S>                                                                                                     <C>
After one year.............................................................                                            25%
After two years............................................................                                            50%
After three years..........................................................                                            75%
After four years...........................................................                                            100%
</TABLE>

       Following four (4) years of continuous relationship with the Company or
Related Entity from the date the option is granted, the option will be 100%
vested.

       To ensure that the Company or related entities will achieve the purpose
and receive the benefits contemplated in this Plan, any option granted under
this Plan on or after June 16, 2000 shall, unless this condition is waived or
modified by the Plan Administrator in the agreement evidencing the option, or by
subsequent resolution of the Plan Administrator, be exercisable according to the
following schedule:

<TABLE>
<CAPTION>
Period of Optionee's Continuous Relationship With the Company or Related Entity                               Portion of Option
                      from the Date the Option is Granted                                                 Which Becomes Exercisable
<S>                                                                                                        <C>
After one year.............................................................                                          25%
Monthly thereafter.........................................................                                        2.083%
</TABLE>

       Following four (4) years of continuous relationship with the Company or
Related Entity from the date the option is granted, the option will be 100%
vested.

              5.4 Exercise. Subject to the vesting schedule described in
subsection 5.3 above, if any, and to any additional holding period required by
applicable law, each option may be exercised in whole or in part; provided,
however, that only whole shares will be issued pursuant to the exercise of any
option and that the exercise price shall not be less than the par value per
share of the Class A Common Stock at the time the option is exercised. During an
Optionee's lifetime, any stock options granted under this Plan are personal to
him or her and are exercisable solely by such Optionee, except as provided in
Section 5.8. Options shall be exercised by delivery to the Company of notice of
the number of shares with respect to which the option is exercised, together
with payment of the exercise price.

              5.5 Payment of Exercise Price. Payment of the option exercise
price shall be made in full at the time the notice of exercise of the option is
delivered to the Company and shall be in cash, bank certified or cashier's check
or personal check (unless at the time of exercise the Plan Administrator in a
particular case determines not to accept a personal check) for the Class A
Common Stock being purchased.

Page 4-STOCK OPTION PLAN

<PAGE>   5

              The Plan Administrator can determine at the time the option is
granted for incentive stock options, or at any time before exercise for
nonqualified stock options, that additional forms of payment will be permitted,
including installment payments on such terms and over such period as the Plan
Administrator may determine in its discretion. To the extent permitted by the
Plan Administrator and applicable laws and regulations (including, but not
limited to, federal tax and securities laws and regulations and state corporate
law), an option may be exercised by:

              (a) delivery of shares of stock of the Company held by an Optionee
having a fair market value equal to the exercise price, such fair market value
to be determined in good faith by the Plan Administrator;

              (b) delivery of a full-recourse promissory note executed by the
Optionee, provided that (i) such note delivered in connection with an incentive
stock option shall, and such note delivered in connection with a nonqualified
stock option may, in the sole discretion of the Plan Administrator, bear
interest at a rate specified by the Plan Administrator but in no case less than
the rate required to avoid imputation of interest (taking into account any
exceptions to the imputed interest rules) for federal income tax purposes; (ii)
the Plan Administrator in its sole discretion shall specify the term and other
provisions of such note at the time an incentive stock option is granted or at
any time prior to exercise of a nonqualified stock option; (iii) the Plan
Administrator may require that the Optionee pledge the Optionee's shares to the
Company for the purpose of securing the payment of such note and may require
that the certificate representing such shares be held in escrow in order to
perfect the Company's security interest; (iv) the note provides that 90 days
following the Optionee's termination of employment with the Company or a related
entity, the entire outstanding balance under the note shall become due and
payable, if not previously due and payable; and (v) the Plan Administrator in
its sole discretion may at any time restrict or rescind this right upon
notification to the Optionee;

              (c) delivery of a properly executed exercise notice, together with
irrevocable instructions to a broker, all in accordance with the regulations of
the Federal Reserve Board, to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price and any federal, state or local
withholding tax obligations that may arise in connection with the exercise;
provided, that the Plan Administrator, in its sole discretion, may at any time
determine that this Subparagraph (c), to the extent the instructions to the
broker call for an immediate sale of the shares, shall not be applicable to any
Optionee who is subject to Section 16(b) of the Exchange Act if such transaction
would result in a violation of Section 16(b), or is not an employee at the time
of exercise;

              (d) delivery of a properly executed exercise notice, together with
a request by the Optionee for the Company to pay the exercise price by
withholding from the shares that would otherwise be issued that number of shares
having a fair market value equal to the option exercise price; provided, the
Plan Administrator retains complete discretion to honor or deny the Optionee's
request for such a method of exercise.

              5.6 Shareholders' Agreement. To the extent required by the Plan
Administrator upon exercise of an option the Optionee shall agree to enter into
and be bound by the agreement

Page 5-STOCK OPTION PLAN

<PAGE>   6

then in effect, if any, between the Company and its shareholders relating to the
repurchase by the Company of its outstanding Class A Common Stock.

              5.7 Withholding Tax Requirement. The Company or any related entity
shall have the right to retain and withhold from any payment of cash or Class A
Common Stock under this Plan the amount of taxes required by any government to
be withheld or otherwise deducted and paid with respect to such payment. At its
discretion, the Company may require an Optionee receiving shares of Class A
Common Stock to reimburse the Company or a related entity for any such taxes
required to be withheld and may withhold any distribution in whole or in part
until the Company, or related entity, is so reimbursed. In lieu of such
withholding or reimbursement, the Company (or related entity) shall have the
right to withhold from any other cash amounts due or to become due from the
Company (or related entity) to the Optionee an amount equal to such taxes or to
retain and withhold a number of shares having a market value not less than the
amount of such taxes required to be withheld as reimbursement for any such taxes
and cancel (in whole or in part) any such shares so withheld.

              5.8 Nontransferability of Option. Options granted under this Plan
and the rights and privileges conferred by this Plan may not be transferred,
assigned, pledged or hypothecated in any manner (whether by operation of law or
otherwise) other than by will or by the applicable laws of descent and
distribution; provided, with respect to a non-qualified stock option, an
Optionee may transfer the option to a revocable trust created by the Optionee
for the benefit of his or her descendants, to an immediate family member or to a
partnership in which only immediate family members or such trusts are partners.
Options under this Plan shall not be subject to execution, attachment or similar
process. Any attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of any option under this Plan or of any right or privilege conferred by
this Plan, contrary to the Code or to the provisions of this Plan, or the sale
or levy or any attachment or similar process upon the rights and privileges
conferred by this Plan shall be null and void. Notwithstanding the foregoing, an
Optionee may during the Optionee's lifetime, designate a person who may exercise
the option after the Optionee's death by giving written notice of such
designation to the Plan Administrator. Such designation may be changed from time
to time by the Optionee by giving written notice to the Plan Administrator
revoking any earlier designation and making a new designation.

              5.9 Termination of Relationship. If the Optionee's employment
relationship with the Company or any related entity ceases for any reason other
than termination for cause, death or permanent and total disability, and unless
by its terms the option sooner terminates or expires, then the Optionee may
exercise, for a period of three months after such cessation, that portion of the
Optionee's option which is exercisable at the time of such cessation. The
Optionee's option, however, shall terminate at the end of the three month period
following such cessation as to all Shares for which it has not been exercised,
unless such provision is waived in the agreement evidencing the option or by
resolution adopted by the Plan Administrator. If, in the case of an incentive
stock option, an Optionee's relationship with the Company or related entity
changes (i.e., from employee to nonemployee, such as a consultant), such change
shall constitute a termination of an Optionee's employment with the Company or
related entity and the Optionee's incentive stock option shall terminate in
accordance with this subsection. Upon the expiration of the three month period
following cessation of employment, the Plan Administrator shall have

Page 6-STOCK OPTION PLAN

<PAGE>   7

sole discretion in a particular circumstance to extend the exercise period
following such cessation beyond that specified above. If, however, in the case
of an incentive stock option, the Optionee does not exercise the Optionee's
option within three months after cessation of employment, the option will no
longer qualify as an incentive stock option under the Code.

              Upon an Optionee's termination of employment for cause, all of the
optionee's outstanding (i.e., unexercised) options issued under this Plan shall
immediately expire and no longer be available for exercise. For purposes of this
Section 5.9, a termination shall be considered for "cause" if the termination is
attributable to the Optionee's: (a) Embezzlement; (b) use of illegal drugs or
alcohol that materially impairs the Optionee's ability to fulfill his or her
duties as an employee or independent contractor; (c) willful disclosure of trade
secrets or confidential information of the Company; (d) dishonesty which results
in substantial harm to the Company; or (e) conviction or confession of a
criminal felony.

              If an Optionee's relationship with the Company or any related
entity ceases because of a permanent and total disability, the Optionee's option
shall not terminate, and in the case of an incentive stock option, shall not
cease to be treated as an incentive stock option, until the end of the 12-month
period following such cessation (unless by its terms it sooner terminates and
expires). As used in this Plan, the term "permanent and total disability" has
the same meaning provided in Code Section 22(e)(3).

              For purposes of this subsection 5.9, a transfer of relationship
between or among the Company and/or any related entity shall not be deemed to
constitute a cessation of relationship with the Company or any of its related
entities. For purposes of this subsection 5.9, with respect to incentive stock
options, employment shall be deemed to continue while the Optionee is on
military leave, sick leave or other bona fide leave of absence (as determined by
the Plan Administrator). The foregoing notwithstanding, employment shall not be
deemed to continue beyond the first 90 days of such leave, unless the Optionee's
reemployment rights are guaranteed by statute or by contract.

              As used in this Plan, the term "related entity," when referring to
a subsidiary, shall mean any business entity (other than the Company) which, at
the time of the granting of the option, is in an unbroken chain of entities
ending with the Company, if stock or voting interests possessing 50% or more of
the total combined voting power of all classes of stock or other ownership
interests of each of the entities other than the Company is owned by one of the
other entities in such chain. When referring to a parent entity, the term
"related entity" shall mean any entity in an unbroken chain of entities ending
with the Company if, at the time of the granting of the option, each of the
entities other than the Company owns stock or other ownership interests
possessing 50% or more of the total combined voting power of all classes of
stock (or other ownership interests) in one of the other entities in such chain.
In addition, with respect to an incentive stock option, the definition of
"related entity" as used in this Plan shall apply by only considering entities
that are corporations.

              5.10 Death of Optionee. If an Optionee dies while he or she has a
relationship with the Company or any related entity or dies within the three
month period (or 12-month period in the case of totally disabled Optionees)
following cessation of such relationship, any option held

Page 7-STOCK OPTION PLAN

<PAGE>   8

by such Optionee to the extent that the Optionee would have been entitled to
exercise such option, may be exercised within one year after his or her death by
the personal representative of his or her estate or by the person or persons to
whom the Optionee's rights under the option shall pass by will or by the
applicable laws of descent and distribution.

              5.11 Status of Shareholder. Neither the Optionee nor any party to
which the Optionee's rights and privileges under the option may pass shall be,
or have any of the rights or privileges of, a shareholder of the Company with
respect to any of the shares issuable upon the exercise of any option granted
under this Plan unless and until such option has been exercised.

              5.12 Continuation of Employment. Nothing in this Plan or in any
option granted pursuant to this Plan shall confer upon any Optionee any right to
continue in the employ of the Company or of a related entity, or to interfere in
any way with the right of the Company or of any related entity to terminate his
or her employment or other relationship with the Company or a related entity at
any time.

              5.13 Modification and Amendment of Option. Subject to the
requirements of Code Section 422 with respect to incentive stock options and to
the terms and conditions and within the limitations of this Plan, the Plan
Administrator may modify or amend outstanding options granted under this Plan.
The modification or amendment of an outstanding option shall not, without the
consent of the Optionee, impair or diminish any of his or her rights or any of
the obligations of the Company under such option. Except as otherwise provided
in this Plan, no outstanding option shall be terminated without the consent of
the Optionee. Unless the Optionee agrees otherwise, any changes or adjustments
made to outstanding incentive stock options granted under this Plan shall be
made in such a manner so as not to constitute a "modification" as defined in
Code Section 424(h) and so as not to cause any incentive stock option issued
hereunder to fail to continue to qualify as an incentive stock option as defined
in Code Section 422(b).

              5.14 Limitation on Value for Incentive Stock Options. As to all
incentive stock options granted under the terms of this Plan, to the extent that
the aggregate fair market value (determined at the time the incentive stock
option is granted) of the stock with respect to which incentive stock options
are exercisable for the first time by the Optionee during any calendar year
(under this Plan and all other incentive stock option plans of the Company, a
related entity or a predecessor corporation) exceeds $100,000, those options (or
the portion of an option) beyond the $100,000 threshold shall be treated as
nonqualified stock options. The previous sentence shall not apply if the
Internal Revenue Service publicly rules, issues a private ruling to the Company,
any Optionee, or any legatee, personal representative or distributee of an
Optionee or issues regulations changing or eliminating such annual limit.

       SECTION 6. Greater Than 10% Shareholders.

              6.1 Exercise Price and Term of Incentive Stock Options. If
incentive stock options are granted under this Plan to employees who own more
than 10% of the total combined voting power of all classes of stock of the
Company or any related entity, the term of such incentive stock options shall
not exceed five years and the exercise price shall be not less than

Page 8-STOCK OPTION PLAN

<PAGE>   9

110% of the fair market value of the Class A Common Stock at the time the
incentive stock option is granted. This provision shall control notwithstanding
any contrary terms contained in an option agreement or any other document.

              6.2 Attribution Rule. For purposes of subsection 6.1, in
determining stock ownership, an employee shall be deemed to own the stock owned,
directly or indirectly, by or for his brothers, sisters, spouse, ancestors and
lineal descendants. Stock owned, directly or indirectly, by or for a
corporation, partnership, estate or trust shall be deemed to be owned
proportionately by or for its shareholders, partners or beneficiaries. If an
employee or a person related to the employee owns an unexercised option or
warrant to purchase stock of the Company, the stock subject to that portion of
the option or warrant which is unexercised shall not be counted in determining
stock ownership. For purposes of this Section 6, stock owned by an employee
shall include all stock actually issued and outstanding immediately before the
grant of the incentive stock option to the employee.

       SECTION 7. Adjustments Upon Changes in Capitalization. The aggregate
number and class of shares for which options may -be granted under this Plan,
the number and class of shares covered by each outstanding option and the
exercise price per share thereof (but not the total price), and each such
option, shall all be proportionately adjusted for any increase or decrease in
the number of issued shares of Class A Common Stock of the Company resulting
from a split-up or consolidation of shares or any like capital adjustment, or
the payment of any stock dividend.

              7.1 Effect of Liquidation, Reorganization or Change in Control.

                     7.1.1 Cash, Stock or Other Property for Stock. Except as
provided in subsection 7.1.2, upon a merger (other than a merger of the Company
in which the holders of Class A Common Stock immediately prior to the merger
have the same proportionate ownership of Class A Common Stock in the surviving
corporation immediately after the merger), consolidation, acquisition of
property or stock, separation, reorganization (other than a mere reincorporation
or the creation of a holding company) or liquidation of the Company, as a result
of which the shareholders of the Company receive cash, stock or other property
in exchange for or in connection with their shares of Class A Common Stock, any
option granted under this Plan shall terminate. Notwithstanding the foregoing,
the Optionee shall have the right immediately prior to any such merger,
consolidation, acquisition of property or stock, separation, reorganization or
liquidation to exercise such option in whole or in part, to the extent the
vesting requirements set forth in this Plan have been satisfied, unless stated
otherwise in the Optionee's individual option agreement.

                     7.1.2 Conversion of Options on Stock for Stock Exchange.
If the shareholders of the Company receive capital stock of another corporation
("Exchange Stock") in exchange for their shares of Class A Common Stock in any
transaction involving a merger (other than a merger of the Company in which the
holders of Class A Common Stock immediately prior to the merger have the same
proportionate ownership of common stock in the surviving corporation immediately
after the merger), consolidation, acquisition of property or stock, separation
or reorganization (other than a mere reincorporation or the creation of a
holding company), all options granted under this Plan shall be converted into
options to purchase shares

Page 9-STOCK OPTION PLAN

<PAGE>   10

of Exchange Stock unless the Company and the corporation issuing the Exchange
Stock, in their sole discretion, determine that any or all such options granted
under this Plan shall not be converted into options to purchase shares of
Exchange Stock, but instead shall terminate in accordance with the provisions of
subsection 7.1.1. The amount and price of converted options shall be determined
by adjusting the amount and price of the options granted under this Plan in the
same proportion as used for determining the number of shares of Exchange Stock
the holders of the Class A Common Stock receive in such merger, consolidation,
acquisition of property or stock, separation or reorganization. Unless
accelerated by the Board, the vesting schedule set forth in the option agreement
shall continue to apply for the Exchange Stock.

                     7.1.3 Change in Control.

              (a)    In the event of a "Change in Control", as defined in
       Section 7.1.4(b) below, of the Company, except as provided in Section
       7.1.3(b) or unless otherwise determined by the Board prior to the
       occurrence of such a Change in Control, any options or portions of such
       options outstanding as of the date such a Change in Control is determined
       to have occurred that are not yet fully vested shall not become fully
       vested merely by the occurrence of a Change in Control.

              (b)    Notwithstanding anything to the contrary in Section
       7.1.3(a), each outstanding option granted prior to February 16, 2000
       (other than those options described in Section 7.1.3.(d)) shall be deemed
       to be amended to provide that, and each option granted on or after such
       date shall provide that, unless otherwise expressly determined in a
       resolution duly adopted by the Board on the date of grant or such later
       date on which the Board may ratify such grant, such option shall (1) if
       the Optionee is a Nonaffiliate Director, immediately become fully
       exercisable upon the occurrence of an Acceleration Change of Control of
       the Company or (2) if the Optionee is recognized by the Company or any of
       the related entities as a regular full time employee who is subject to
       U.S. income tax withholding, immediately become fully exercisable upon
       the termination of the Optionee's employment by the Company or any of the
       related entities without Cause during the Accelerated Vesting Period or,
       in the case of an Optionee who is an Executive, upon the termination of
       the Optionee's employment by the Optionee for Good Reason during the
       Accelerated Vesting Period; provided, however, that this Section 7.1.3(b)
       shall be deemed void ab initio and shall be of no force or effect, if it
       should be determined that any such provision would prevent a proposed
       merger or other business combination that is intended by the parties
       thereto to be accounted for as a pooling of interests from being so
       accounted for.

              (c)    With respect to options that, as of February 16, 2000,
       incorporate a definition of change of control that provides for
       accelerated vesting solely in the event that Craig O. McCaw, or an entity
       or entities he controls, no longer controls a majority of the votes of
       the Company (or language to that effect), Section 7.1.3(b) shall
       supplement such provision and each holder of such an option shall be
       entitled to the benefits of Section 7.1.3(b), but Section 7.1.3(b) shall
       not be deemed to modify, replace or impair such options' existing change
       of control provisions.

Page 10-STOCK OPTION PLAN

<PAGE>   11

              (d)    Notwithstanding anything to the contrary in Section
       7.1.3(b), Section 7.1.3(b) shall not apply to the following options
       granted prior to February 16, 2000:

                     (i)    options granted to any employee whose employment
              relationship is subject, as of February 16, 2000, to severance in
              connection with the relocation of the Company's headquarters from
              Bellevue, Washington to Reston, Virginia, where such employee is
              entitled to benefits under the NEXTLINK Headquarters Relocation
              Retention and Severance Pay Plan and Summary Plan Description for
              Headquarters Personnel;

                     (ii)   options granted to any employee whose employment
              relationship is subject, as of February 16, 2000, to severance in
              connection with the reorganization and restructuring of the
              Company's regional divisions, where such employee is entitled to
              benefits under the NEXTLINK Severance Pay Plan and Summary Plan
              Description; and

                     (iii)  options (A) that, by their terms, incorporate the
              definition of "Change in Control" set forth in Section 7.1.4(b) of
              this Plan as in effect prior to the February 16, 2000 amendment
              thereto and provide for accelerated vesting upon the occurrence of
              such a "Change in Control", or (B) that provide for acceleration
              upon a change of control pursuant to the terms of an employment
              agreement or otherwise, excluding those options referenced in
              Section 7.1.3(c).

                     7.1.4 Definitions.

              (a)    For purposes of Section 7.1.3, the following defined terms
       shall have the following meanings:

              "Acceleration Change of Control" shall mean the occurrence of any
of the following events:

              (A)    The Company is merged or consolidated or reorganized into
                     or with another company or other legal entity, other than a
                     merger or consolidation or reorganization into or with an
                     entity that is an affiliate of Craig O. McCaw, and as a
                     result of such merger, consolidation or reorganization less
                     than a majority of the combined voting power of the
                     then-outstanding securities of such company or person
                     immediately after such transaction is held directly or
                     indirectly in the aggregate by the holders of voting
                     securities of the Company immediately prior to such sale or
                     transfer, including voting securities issuable upon
                     exercise or conversion of options, warrants or other
                     securities or rights;

              (B)    The Company sells or otherwise transfers all or
                     substantially all of its assets to any other company or
                     other legal entity, other than such a sale or transfer to a
                     company or legal entity that is an affiliate of Craig O.

Page 11-STOCK OPTION PLAN

<PAGE>   12

                     McCaw, and as a result of such sale or other transfer of
                     assets, less than a majority of the combined voting power
                     of the then-outstanding securities of such company or
                     person immediately after such sale or transfer is held
                     directly or indirectly in the aggregate by the holders of
                     voting securities of the Company immediately prior to such
                     sale or transfer, including voting securities issuable upon
                     exercise or conversion of options, warrants or other
                     securities or rights;

              (C)    There is a report filed on Schedule 13D or Schedule 14D-1
                     (or any successor schedule, form or report), each as
                     promulgated pursuant to the Securities Exchange Act of
                     1934, as amended (the "Exchange Act"), disclosing that any
                     person (as the term "person" is used in Section 13(d)(3) or
                     Section 14(d)(2) of the Exchange Act) other than Craig O.
                     McCaw and his affiliates has become the beneficial owner
                     (as the term "beneficial owner" is defined under Rule 13d-3
                     or any successor rule or regulation promulgated under the
                     Exchange Act) of securities representing 50% or more of the
                     voting securities of the Company, including voting
                     securities issuable upon exercise or conversion of options,
                     warrants or other securities or rights;

              (D)    The Company files a report or proxy statement with the
                     Securities and Exchange Commission pursuant to the Exchange
                     Act disclosing in response to Form 8-K or Schedule 14A (or
                     any successor schedule, form or report or item therein)
                     that a change in control of the Company has occurred;

              (E)    Notwithstanding the foregoing provisions of subparagraphs
                     (C) and (D) hereof, an "Acceleration Change of Control"
                     shall not be deemed to have occurred solely because (x) the
                     Company, (y) an entity in which the Company directly or
                     indirectly beneficially owns 50% or more of the voting
                     securities, or (z) any Company-sponsored employee stock
                     ownership plan or other employee benefit plan of the
                     Company, either files or becomes obligated to file a report
                     or proxy statement under or in response to Schedule 13D,
                     Schedule 14D-1, Form 8-K or Schedule 14A (or any successor
                     schedule, form or report or item therein) under the
                     Exchange Act, disclosing beneficial ownership by it of
                     voting securities, whether in excess of 50% or otherwise,
                     or because the Company reports that a change of control of
                     the Company has or may have occurred or will or may occur
                     in the future by reason of such beneficial ownership;

              (F)    Notwithstanding the foregoing provisions of subparagraphs
                     (A) through (D) above, no Acceleration Change of Control
                     shall result from a merger, consolidation or reorganization
                     of the Company with any entity in which Eagle River
                     Investments, L.L.C. has invested at least $10,000,000 in
                     equity prior to such merger, consolidation or
                     reorganization.

Page 12-STOCK OPTION PLAN

<PAGE>   13

              "Accelerated Vesting Period" means the period beginning on the
effective date of an Acceleration Change of Control and ending on the first
anniversary of such effective date.

              "Cause" means (i) the conviction of a felony involving an
intentional act of fraud, embezzlement or theft in connection with one's duties
or otherwise in the course of one's employment with an Employer, (ii) the
intentional and wrongful damaging of property, contractual interests or business
relationships of an Employer, (iii) the intentional and wrongful disclosure of
secret processes or confidential information of an Employer in violation of an
agreement with or a policy of an Employer, or (iv) intentional conduct contrary
to an Employer's announced policies or practices (including those contained in
the Corporation's Employee Handbook) where either:

              (A)    the nature and/or severity of the conduct or its
                     consequences typically would have resulted in immediate
                     termination based on the Corporation's established employee
                     termination or disciplinary practices in place on the
                     Reference Date; or

              (B)    the employee has been provided with written notice
                     detailing the relevant policy or practice and the nature of
                     the objectionable conduct or other violation, and within 20
                     business days of the receipt of such notice the employee
                     has not remedied the violation or ceased to engage in the
                     objectionable conduct.

              "Executive" means any individual employed by the Company or any of
the related entities in a position having a salary grade of EX3, EX2 or EX1 (as
the Company's salary grades are established and in existence on February 16,
2000, and adjusting as appropriate for any changes to the Company's system of
classifying its employees by salary grades implemented subsequent to such date).

              "Good Reason" means that an Executive shall have made a good faith
determination that one or more of the following has occurred:

              (i)    any significant and adverse change in the Executive's
                     duties, responsibilities and authority, as compared in each
                     case to the corresponding circumstances in place on the
                     Reference Date;

              (ii)   a relocation of the Executive's principal work location as
                     established on the Reference Date to a location that is
                     more than 30 miles away from such location;

              (iii)  a reduction in the Executive's salary or bonus potential
                     that is not in either case agreed to by the Executive, or
                     any other significant adverse financial consequences
                     associated with the Executive's employment as compared to
                     the corresponding circumstances in place on the Reference
                     Date; or

Page 13-STOCK OPTION PLAN

<PAGE>   14

              (iv)   a breach by any Employer of its obligations under any
                     agreement to which the Employer and the Executive are
                     parties that is not cured within 20 business days following
                     the Employer's receipt of a written notice from the
                     Executive specifying the particulars of such breach in
                     reasonable detail.

              "Nonaffiliate Director" means a person who (i) is serving (or who
has been elected or appointed and has agreed to serve) as a member of the Board,
(ii) is not an officer or employee of the Company or any of the related entities
or a beneficial owner of 10 percent or more of the outstanding common stock of
the Company and (iii) was not elected or appointed as a member of the Board
pursuant to or in connection with any contractual or other commitment on the
part of the Company to cause such person to be elected or appointed, or to
nominate or otherwise advance such person for election or appointment, as a
member of the Board.

              "Reference Date" means the day before the effective date of any
Acceleration Change of Control of the Company.

              (b)    Solely with respect to options outstanding as of February
       16, 2000 in which the grant agreement evidencing such option incorporates
       the definition of "Change in Control" set forth in this Plan as in effect
       prior to this amendment and provide for accelerated vesting upon the
       occurrence of such a "Change of Control", the following definition shall
       apply:

              A "Change in Control" shall mean (a) the first approval by the
Board or by the stockholders of the Company of an Extraordinary Event, (b) a
Purchase, or (c) a Board Change.

              An "Extraordinary Event", for purposes of Section 7.1.4(b), shall
mean any of the following actions:

              (i)    any consolidation or merger of the Company in which the
       Company is not the continuing or surviving corporation or pursuant to
       which shares of Class A Common Stock would be converted into cash,
       securities or other property, other than a merger of the Company in which
       the holders of common stock immediately prior to the merger have
       substantially the same proportionate ownership of common stock of the
       surviving corporation immediately after the merger;

              (ii)   any sale, lease, exchange or other transfer (in one
       transaction or a series of related transactions) of all, or substantially
       all, the assets of the Company; or

              (iii)  the adoption of any plan or proposal for liquidation or
       dissolution of the Company.

              A "Purchase", for purposes of Section 7.1.4(b), shall mean the
acquisition by any person (as such term is defined in Section 13(d) of the
Exchange Act) of any shares of Class A Common Stock or securities convertible
into Class A Common Stock) without the prior approval of a majority of the
Continuing Directors (as defined below) of the Company, if after making

Page 14-STOCK OPTION PLAN

<PAGE>   15

such acquisition such person is the beneficial owner (as such term is defined in
Rule 13d-3 under the Exchange Act) directly or indirectly of securities of the
Company representing 20% or more of the combined voting power of the Company's
then outstanding securities (calculated as provided in paragraph (d) of such
Rule 13d-3).

              A "Board Change", for purposes of Section 7.1.4(b), shall have
occurred if individuals who constitute the Board of the Company at the time
of adoption of this Plan (the "Continuing Directors") cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a
Director subsequent to the date of adoption of this Plan whose nomination for
election was approved by a vote of at least a majority of the Continuing
Directors (other than a nomination of an individual whose initial assumption of
office is in connection with an actual threatened election contest relating to
the election of the Directors of the Company, as such terms are used in Rule
14a-11 of Regulation 14A under the Exchange Act) shall be deemed to be a
Continuing Director.

              7.2 Fractional Shares. In the event of any adjustment in the
number of shares covered by any option, any fractional shares resulting from
such adjustment shall be disregarded and each such option shall cover only the
number of full shares resulting from such adjustment.

              7.3 Determination of Board to Be Final. All Section 7 adjustments
shall be made by the Board, and its determination as to what adjustments shall
be made, and the extent of such adjustments, shall be final, binding and
conclusive. Unless an Optionee agrees otherwise, any change or adjustment to an
incentive stock option shall be made in such a manner so as not to constitute a
"modification" as defined in Code Section 424(h) and so as not to cause his or
her incentive stock option issued under this Plan to fail to continue to qualify
as an incentive stock option as defined in Code Section 422(b).

       SECTION 8. Securities Regulation. Shares shall not be issued with respect
to an option granted under this Plan unless the exercise of such option and the
issuance and delivery of such shares pursuant to the exercise of such option
shall comply with all relevant provisions of law, including, without limitation,
any applicable state securities laws, the Securities Act of 1933, as amended,
the Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may then be listed, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance, including the availability of an exemption from registration
for the issuance and sale of any shares under this Plan. Inability of the
Company to obtain from any regulatory body having jurisdiction, the authority
deemed by the Company's counsel to be necessary for the lawful issuance and sale
of any shares under this Plan or the unavailability of an exemption from
registration for the issuance and sale of any shares under this Plan shall
relieve the Company of any liability in respect of the nonissuance or sale of
such shares as to which such requisite authority shall not have been obtained.

              As a condition to the exercise of an option, the Company may
require the Optionee to represent and warrant at the time of any such exercise
that the shares are being purchased only for investment and without any present
intention to sell or distribute such shares if, in the opinion of counsel for
the Company, such a representation is required by any relevant

Page 15-STOCK OPTION PLAN

<PAGE>   16

provision of the aforementioned laws. At the option of the Company, a
stop-transfer order against any shares of stock may be placed on the official
stock books and records of the Company, and a legend indicating that the stock
may not be pledged, sold or otherwise transferred unless an opinion of counsel
is provided (concurred in by counsel for the Company) stating that such transfer
is not in violation of any applicable law or regulation, may be stamped on stock
certificates in order to assure exemption from registration. The Plan
Administrator may also require such other action or agreement by the Optionees
as may from time to time be necessary to comply with the federal and state
securities laws. THIS PROVISION SHALL NOT OBLIGATE THE COMPANY TO UNDERTAKE
REGISTRATION OF THE OPTIONS OR STOCK HEREUNDER.

              Should any of the Company's capital stock of the same class as the
stock subject to options granted under this Plan be listed on a national
securities exchange, all stock issued under this Plan if not previously listed
on such exchange shall be authorized by that exchange for listing on such
exchange prior to the issuance of such stock.

       SECTION 9. Amendment and Termination.

              9.1 Board Action. The Board may at any time suspend, amend or
terminate this Plan, provided that except as set forth in Section 7, the
approval of the Company's shareholders is necessary within 12 months before or
after the adoption by the Board of any amendment which will:

                     (a) increase the number of shares which are to be reserved
for the issuance of options under this Plan;

                     (b) permit the granting of stock options to a class of
persons other than those presently permitted to receive stock options under this
Plan; or

                     (c) require shareholder approval under applicable law,
including Section 16(b) of the Exchange Act.

              Any amendment to this Plan that would constitute a "modification"
to incentive stock options outstanding on the date of such amendment shall not
be applicable to outstanding incentive stock options, but shall have prospective
effect only, unless individual Optionees agree otherwise.

              9.2 Automatic Termination. Unless sooner terminated by the Board,
this Plan shall terminate ten years from the earlier of (a) the date on which
this Plan is adopted by the Board or (b) the date on which this Plan is approved
by the shareholders of the Company. No option may be granted after such
termination or during any suspension of this Plan. The amendment or termination
of this Plan shall not, without the consent of the option holder, alter or
impair any rights or obligations under any option previously granted under this
Plan.

Page 16-STOCK OPTION PLAN

<PAGE>   17

       SECTION 10. Effectiveness of This Plan. This Plan shall become effective
upon adoption by the Board so long as it is approved by the Company's
shareholders any time within 12 months before or after the adoption of this
Plan.

Page 17-STOCK OPTION PLAN

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