Document:

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                                                                    EXHIBIT 10.7

                                   FORM OF

              MASTER COMMUNICATIONS LICENSE TRANSACTION AGREEMENT

     THIS MASTER COMMUNICATIONS LICENSE TRANSACTION AGREEMENT (this "Agreement")
is made this _____ day of __________________, 1999 (the "Date of this
Agreement"), by and between CYPRESS COMMUNICATIONS, INC., a Delaware corporation
having offices at Fifteen Piedmont Center, Suite 710, Atlanta, Georgia 30305
("Cypress"), and ___________________________________________, a
______________________________, having an address at
___________________________________________________________ (collectively,
"Company").  Cypress and Company are sometimes referred to in this Agreement
individually as a "Party" and collectively as the "Parties."

     WHEREAS, the Parties desire to execute definitive agreements by which: (a)
Company would grant licenses to Cypress to permit Cypress to install, manage,
and operate communications infrastructures within certain commercial office
buildings owned, operated, or managed by Company or various affiliated entities,
and to provide enhanced communications services within those buildings to
tenants and other occupants thereof (the "Master Agreement"); and (b) Cypress
would grant rights and options to Company to purchase shares of outstanding
voting common stock in Cypress (the "Warrant Agreement"); and

     WHEREAS, the Parties agree that, in reliance upon each of the
representations and warranties set forth in this Agreement, they will enter
into, or use reasonable efforts to cause an affiliated entity as appropriate to
enter into, a Communications License Agreement in the form of the attached
Exhibit A, or a lease on substantially identical terms as such License
---------
Agreement, at Company's election (said License Agreement and lease being
hereinafter referred to as the "License Agreement") with respect to each of the
office buildings or office building complexes the Parties identify in the
attached Exhibit B as amended from time to time in accordance with this
         ---------
Agreement ("Buildings List");

     NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the receipt and sufficiency of which the Parties hereby acknowledge,
Cypress and Company hereby covenant and agree as follows:

1.   DEFINITIONS.

Terms used herein that are defined in the form License Agreement attached as
Exhibit A hereto shall have the meanings given such terms unless a different
---------
meaning is expressly provided herein.  In addition, the following terms shall
have the following meanings for purposes of this Agreement:

(a)  "Affiliate" shall mean and include any person or entity (i) that directly
     or indirectly, through one or more intermediaries, controls, is controlled
     by, or is under common control with, a Party; (ii) that beneficially owns
     or holds, directly or indirectly by attribution, more than fifty percent
     (50%) of any class of the outstanding voting stock or other voting
     ownership interests of a Party; or (iii) more than fifty percent (50%) of
     the outstanding voting stock or other voting ownership interests (or in the
     case of a person or entity that is not a corporation, more
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     than fifty percent (50%) of the equity interest) of which is beneficially
     owned or held, directly or indirectly by attribution, by a Party.

(b)  "Building" or "Buildings" shall mean the applicable building(s) described
     in, and that are the subject of, a License Agreement.

(c)  "Diligence Period" shall mean the period commencing upon the Date of this
     Agreement and ending at 5:00 p.m. on the sixtieth (60th) day thereafter.

(d)  "GLA" shall mean, with respect to any Building, the gross leasable area
     within such Building, as stipulated in the License Agreement with respect
     to such Building.

(e)  "Owner" shall mean, with respect to any Building, the person or entity
     holding record or beneficial title to such Building.

(f)  "Total GLA" shall mean the aggregate GLA of all Buildings.

2.     REPRESENTATIONS AND WARRANTIES.

       Each Party hereby represents and warrants to the other the following:

       (a)   Such Party has full corporate power and authority to execute and
deliver each License Agreement to which it is a party, and perform each of its
obligations related thereto; and

       (b)   As of the end of the Diligence Period, all consents,
authorizations, orders and approvals of (or filings or registrations with) any
governmental commission, board or other regulatory body required in connection
with the execution, delivery, and performance of each License Agreement to which
such Party is a party and the performance of the obligations related thereto
have been obtained or made.

3.     BUILDINGS LIST; OPERATIONS ROLLOUT SCHEDULE.

       (a)   The list of commercial office buildings and commercial office
building complexes attached to this Agreement as Exhibit B sets forth (i) the
                                                 ---------
buildings that are eligible to become the subject of one or more License
Agreements executed by Cypress and either Company or the Owner thereof and (ii)
the GLA for purposes of this Agreement or any License Agreement of each such
building. The Parties may amend Exhibit B from time to time to reflect the
                                ---------
then-current identity of the Owner of such identified buildings, but no change
in GLA will be permitted without Cypress's consent, which will not be
unreasonably withheld. During the Diligence Period, Company shall have the right
and option to remove certain building(s) that are not identified by an asterisk
(*) on Exhibit B attached hereto from this Agreement and the Warrant Agreement,
       ---------
in accordance with Section 3(e) below, by notice to Cypress in accordance with
Section 6 below.

       (b)   Before the expiration of the Diligence Period, Cypress and Company
will negotiate diligently and in good faith to establish a schedule for Cypress
to install Cypress's cable, electronics, and other equipment and facilities
required to commence Cypress's operations

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pursuant to the respective License Agreements within each of the buildings
remaining on Exhibit B after the Diligence Period. The mutually agreed schedule
             ---------
resulting from such negotiation shall be consistent with the schedules Cypress
agrees upon with other commercial office building owners and managers entering
into similar arrangements with Cypress during the Diligence Period and the
Parties shall thereupon amend this Agreement and cause such schedule to be
attached to this Agreement by such amendment as Exhibit C. Cypress shall not
                                                ---------
discriminate among any such commercial office building owners and managers in
the offering or completion of the terms, conditions, or operations rollout
schedules of such arrangements.

     (c)  From time to time in accordance with the rollout schedule attached
hereto as Exhibit C, Cypress may request of Company in writing that Cypress and
          ---------
Company, or, as applicable, the Affiliate or other third party Owner of the
applicable buildings, execute a License Agreement with respect to one or more
buildings listed in the then-current Exhibit B.  Within thirty (30) days after
                                     ---------
Cypress makes any such written request, Cypress and Company or the Affiliate or
other third party Owner shall (i) negotiate diligently and in good faith to
establish the location of the Licensed Area in such Building(s) and (ii) execute
a separate License Agreement for each such Building or complex of Buildings in
accordance with the terms of this Agreement.  Each such License Agreement shall
be substantially in the form of Exhibit A attached hereto and shall (x) identify
                                ---------
and describe the Building and Licensed Area with respect to such License
Agreement, and (y) identify any Building-specific access or construction issues
with respect to such Building.

     (d)  On Exhibit B attached hereto, Company has designated the nature of the
             ---------
license to be granted to Cypress, on a per building basis, for each of the
buildings on Exhibit B, i.e., Exclusive, Semi-Exclusive or Non-Exclusive (as
             ---------
those terms are defined in the form License Agreement attached as Exhibit A).
                                                                  ---------
Company represents that at least 75% of Total GLA represented on Exhibit B has
                                                                 ---------
received the same type of designation by Company (that is, Exclusive, Semi-
Exclusive or Non-Exclusive).

     (e)  With respect to each building identified with an asterisk (*) on
Exhibit B attached to this Agreement on the Date of this Agreement, Company
---------
represents and warrants to Cypress that: (i) either Company or an Owner or
Affiliate designated by Company to be the licensor with respect thereto is duly
authorized to enter into a License Agreement and to grant to Cypress the rights
described therein, and (ii) for each building as to which Company designates an
Owner (other than Company) or Affiliate as the proper licensor under a License
Agreement, Company has obtained the agreement of such Owner or Affiliate that it
will enter into a License Agreement with Cypress pertaining to such building.
With respect to each building that is not identified with an asterisk, as
aforesaid, Company represents and warrants that, as of the Date of this
Agreement, Company has commenced discussions with, and solicited the approval
of, Company's partners, joint venturers, investors and Affiliates having an
interest in such building (collectively, "Partners"), or the Owners of such
building, as applicable, with respect to the proposed grant of license
contemplated in this Agreement.  Moreover, during the Diligence Period, Company
covenants and agrees to undertake commercially reasonable efforts to obtain from
such Partners and Owners, as necessary, (y) written authority to execute License
Agreements for and on behalf of such Partners and Owners or (z) written
agreements with respect to such buildings which convey to Cypress the rights
described in this Agreement.

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Company shall have the right and option to remove any building(s) from Exhibit B
                                                                       ---------
on or before the expiration of the Diligence Period only if such buildings are
not identified by an asterisk on Exhibit B as of the date of this Agreement and,
                                 ---------
despite Company's diligent good faith efforts, (1) the Owners or Company's
Partners having an interest in such building(s) refuse to participate in the
program contemplated in this Agreement or (2) such Owners or Partners are
prohibited from participating in such program as a matter of law or contract, or
pursuant to such Owner's or Partner's organization, authorization or governing
documents. Within fifteen (15) days after the expiration of the Diligence
Period, the Parties shall attach a finalized Exhibit B to this Agreement in
                                             ---------
accordance with any permitted withdrawal(s) by Company or Cypress during the
Diligence Period, as described above. By attaching the finalized Exhibit B to
                                                                 ---------
this Agreement, Company shall be deemed to have restated and reaffirmed the
foregoing representations and warranties with respect to all buildings set forth
on such finalized Exhibit B, except with respect to any building(s) for which
                  ---------
the appropriate Owner or Partner of Company has delivered such representation
and warranty to Cypress in writing within fifteen (15) days after the expiration
of the Diligence Period.

     (f)  With respect to any other buildings that may be owned, managed or
controlled by Company or its Affiliates at any time during the term of this
Agreement, but which do not appear on Exhibit B, Company, Company's Affiliates
                                      ---------
and Cypress may by mutual agreement enter into License Agreements for such other
buildings; provided, however, that any such subsequent License Agreement shall
not affect the number of warrants conveyed to Company under the Warrant
Agreement (except to substitute buildings for previously-designated buildings
sold by an Owner or affiliate, to the extent and as provided in the Warrant
Agreement) or extend to Company the right to make additional purchases under the
Warrant Agreement.

4.   CORPORATE SERVICES.

Subject to available space and other technical conditions, Cypress shall
provide, at no charge to Company and so long as any License Agreement between
the parties is in effect, high speed data and Internet connections (with T1 or
equivalent or greater capacity) between the Internet backbone and one (1)
corporate office of Company  provided, however, that Company shall be
responsible for payment of any taxes, tariffs, user fees, or other charges that
may be imposed by any government entity or utility provider on account of
Company's access, use, or connection therewith.  Subject to the foregoing, such
Services shall be provided to Company subject to and in accordance with the
terms, conditions and limitations of the mutually agreed subscription agreement
attached as Exhibit D.
            ---------

5.   ASSIGNMENT.

Except as hereinafter expressly provided, neither this Agreement, nor the
rights, obligations or duties of either Party under this Agreement may be
assigned or delegated to any other party, person, or entity without the prior
written consent of the other Party hereto, and any attempted assignment or
delegation without such consent shall be void.  Notwithstanding the foregoing,
Cypress has the right, without the consent of Company, to assign its rights,
obligations or duties under this Agreement to an Affiliate of Cypress or to any
entity in connection with a merger or

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consolidation of Cypress under another entity or the sale of all or
substantially all of the assets of Cypress to another entity.

6.   NOTICE.

All notices which may be given by either Party to the other shall be in writing
and shall be deemed to have been duly given (a) on the date of dispatch when
delivered in person, (b) one day after dispatch when sent by overnight courier,
maintaining records of receipt, and (c) on the date of dispatch when sent by
facsimile during normal business hours with telephone confirmation of receipt
(and with confirmation notice given by one of the other approved methods of
delivery within three (3) days after such facsimile transmission) and addressed
as follows:

If to Company:

Attention:
Facsimile No.:

If to Cypress:

Cypress Communications, Inc.
Fifteen Piedmont Center, Suite 710
Atlanta, Georgia 30305

Attention: Mr. Ward C. Bourdeaux, Jr.
Fax No.:  (404) 869-2525

7.   SUCCESSORS AND ASSIGNS.

This Agreement shall be binding upon the Parties and their respective successors
and permitted assigns and all references herein to a Party shall include such
successors and permitted assigns of such party.

8.   AMENDMENTS.

This Agreement may be amended only by written agreement signed by authorized
representatives of the Parties.  No waiver of any provisions of this Agreement
and no consent to any default under this Agreement shall be effective unless the
same shall be in writing and signed by on or on behalf of the Party against whom
such waiver or consent is claimed.

9.   WAIVER.

No failure of either Party to strictly enforce any term, right, or condition of
this Agreement shall be construed as a waiver of such term, right or condition.

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10.  ANNOUNCEMENTS.

Neither Company nor Cypress shall use the name, logo, or trademarks of the other
party in any advertising, promotional material, or trade display, or for any
other commercial purpose, or issue any press release or make any written public
announcement relating to this Agreement, except where required by law or allowed
by the prior written consent of the other party; provided, that any such consent
                                                 --------
shall not be unreasonably withheld.  Without limiting the generality of the
foregoing, (a) Company may in any case withhold its consent to any such press
release or public announcement relating to this Agreement if it determines that
any such press release or public announcement is likely to damage its public
reputation, goodwill, or relationships with its tenants and (b) Cypress may in
any case withhold its consent to any such press release or public announcement
relating to this Agreement if it determines that any such press release or
public announcement is likely to damage its public reputation, goodwill, or
relationships with its customers. Notwithstanding the foregoing, Cypress may
provide a copy of this Agreement to any other licensor-participant in any
program comparable to the stock warrant program contemplated hereunder (in which
Cypress has granted stock warrants in consideration for license rights),
provided that all such persons shall maintain the disclosed information in
confidence at all times thereafter.

11.  SEVERABILITY.

If a court or other lawful authority of competent jurisdiction declares that any
one or more of the provisions contained in this Agreement is invalid, illegal or
unenforceable in any respect, such declaration shall not affect the validity or
enforceability of any other provision of this Agreement, but this Agreement
shall be construed as if such invalid, illegal or unenforceable provision or
provisions had never been contained in this Agreement.

12.  GOVERNING LAW.

This Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware, without regard to its principles of conflicts of law.
The Parties hereby submit to the non-exclusive jurisdiction of the federal and
state courts of the State of Delaware with respect to any action or proceeding
that may be instituted in connection with this Agreement.

13.  HEADINGS.

The headings and numbering of articles, sections and paragraphs in the Agreement
are for convenience only and shall not be construed to define or limit any of
the terms or conditions in this Agreement or affect the meaning or
interpretation of this Agreement.

14.  ENTIRE AGREEMENT.

This Agreement, the Warrant Agreement, the License Agreements and the other
agreements contemplated thereby or affixed thereto, together constitute the
entire agreement between the Parties with respect to the subject matter of this
Agreement, and supersede all prior oral or written agreements, representations,
statements, negotiations, understandings, and proposals

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<PAGE>

relating to the subject matter of this Agreement. The stock warrants to be
issued under the Warrant Agreement shall be in addition to, and not in lieu of,
License Fees to be paid under the License Agreements.

15.  COUNTERPARTS.

For the convenience of the Parties, this Agreement may be executed in several
counterparts, each of which when so executed shall be, and be deemed to be, an
original instrument and such counterparts together shall constitute one and the
same instrument (and notwithstanding their date of execution shall be deemed to
bear a date as of the date of this Agreement). This Agreement may also be
executed by facsimile, with each Party's facsimile signature being as binding on
such Party as an original signature.

[Signatures appear on the following page.]
------------------------------------------

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     IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed for it and on its behalf as of the day and year first above
written.

                                          CYPRESS COMMUNICATIONS, INC.

                                          ____________________________
                                          Ward C. Bourdeaux,
                                          Executive Vice President
                                          _____________________________
By:  ______________________               Date
     Signature

     ______________________
     Printed Name

     ______________________
     Title

   __________________________________________________________________________

                                     DATE
                                     ----

                                       8<PAGE>

                                                                    EXHIBIT 10.8

No. W____                                                     _________, 1999

     The securities represented by this Warrant and issuable upon exercise
hereof have not been registered or qualified under the Securities Act of 1933,
as amended (the "1933 Act"), or under the provisions of any applicable state
securities laws, but have been acquired by the registered holder hereof for
purposes of investment and in reliance on statutory exemptions under the 1933
Act and under any applicable state securities laws.  These securities and the
securities issued upon exercise hereof may not be sold, pledged, transferred or
assigned, nor may this Warrant be exercised, except in a transaction which is
exempt under provisions of the 1933 Act and any applicable state securities laws
or pursuant to an effective registration statement; and in the case of an
exemption, only if the Company has received an opinion of counsel satisfactory
to the Company that such transaction does not require registration of any such
securities.

                                    FORM OF
                            STOCK WARRANT AGREEMENT

     1.   Grant of Warrant.
          ----------------

          (a)  Cypress Communications, Inc. (the "Company"), a Delaware
corporation, hereby agrees that ____________________ (the "Holder") is entitled,
subject to the provisions of this Warrant, to purchase from the Company, subject
to the conditions set forth below during the period commencing on the date
hereof and expiring at 5:00 P.M. Atlanta, Georgia, time, on the ______ (____)
anniversary of the date of this Warrant (the "Expiration Date"), up to that
number of fully paid and non-assessable shares of Common Stock as set forth in
Section 2(c) herein, at a price of $19.00 per share (the "Exercise Price").

          (b)  The term "Common Stock" means the voting Common Stock, $0.001 par
value per share, of the Company as constituted on the date hereof, together with
any other equity securities that may be issued by the Company in substitution
therefor. The number of shares of Common Stock to be received upon the exercise
of this Warrant and the Exercise Price may be adjusted from time to time as
hereinafter set forth. The shares of Common Stock deliverable upon such
exercise, and as adjusted from time to time, are hereinafter referred to as
"Warrant Stock." The term "Company" means and includes the Company as well as
(i) any successor corporation resulting from the merger or consolidation of such
corporation with another corporation, or (ii) any corporation to which such
corporation has transferred its property or assets as an entirety or
substantially as an entirety. All other capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in that certain Master
Communications License Transaction Agreement between the Company and Holder
dated _________________, 1999, as the same may be amended from time to time (the
"Master Agreement").

     2.   Exercise of Warrant.
          -------------------

          (a)  Subject to the limitations set forth in Section 5, this Warrant
may be exercised in whole or in part commencing at any time and from time to
time after (i) the completion of the Warrant Calculation and (ii) the earlier of
(A) the date six months following the closing of the IPO (as defined below), or
(B) September 30, 2000, or (C) the occurrence of an event described in Section
2(a)(ii) or Section 2(a)(iii) below, and prior to and including the Expiration
Date (if such day is a day on which banking institutions in Georgia are
authorized by
<PAGE>

law to close, then on the next succeeding day that shall not be such a day), if
any of the following conditions have occurred (each an "Exercise Event"):

               (i)  the closing of the first sale to the public of the equity
securities of the Company pursuant to a registration statement filed with, and
declared effective by, the Securities and Exchange Commission under the 1933 Act
(the "IPO");

               (ii) the consummation of any merger, consolidation, business
combination, reorganization or recapitalization of the Company to which the
Company is a party, except for a merger, consolidation or other corporate
reorganization, in which after giving effect to such event, the holders of the
Company's outstanding capital stock (or their Permitted Transferees, as such
term is described in the Company's Certificate of Incorporation) immediately
prior to such event own directly or indirectly at least 50% of the Company's
voting power under ordinary circumstances;

               (iii)  a sale, lease or other disposition of all or substantially
all of the assets of the Company;

               (iv) the execution by the Company and Holder (or any Affiliate of
Owner) of License Agreements pertaining to 75% or more of the GLA as represented
by the final Buildings List in accordance with the Master Agreement; or

               (v)  the Company's execution and delivery of License Agreements
to Holder pertaining to Buildings with an aggregate of at least 5,000,000 square
feet of GLA.

          (b)  The Company shall give written notice to Holder at least 30 days
prior to the date of any Exercise Event described in Section 2(a)(i), (ii) or
(iii). The Company shall promptly notify the Holder in writing following the
occurrence of any other Exercise Event.

          (c)  Promptly after the end of the Diligence Period, the Company shall
provide Holder a calculation of that number of shares of Warrant Stock (rounded
to the nearest whole number) which the Holder shall be entitled to purchase upon
exercise of this Warrant (the "Calculation Notice"). The number of shares of
Warrant Stock issuable upon exercise of this Warrant shall be the sum of the
following (the "Warrant Calculation"):

               (i)   GLA of Buildings designated as Exclusive on the Buildings
List shall be divided by 1,000,000, and that result shall be multiplied by ____;
              ----------                                     -------------

               plus:
               ----

               (ii)  GLA of Buildings designated as Semi-Exclusive on the
Buildings List shall be divided by 1,000,000, and that result shall be
                        ----------
multiplied by ________;
-------------
               plus:
               ----

               (iii) GLA of Buildings designated as Non-Exclusive on the
Buildings List shall be divided by 1,000,000, and that result shall be
                        ----------
multiplied by ________;
-------------

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               minus:
               -----

               (iv) The number of shares of Warrant Stock forfeited by Holder
pursuant to Section 9 prior to Holder's exercise of this Warrant.

Upon receipt of the Calculation Notice from the Company, the Holder shall have
twenty (20) days to provide to the Company written notice of any objection with
respect to such Warrant Calculation (the "Protest Notice").  If the Holder fails
to provide Company with such Protest Notice within such twenty-day period, the
Holder shall be deemed to have accepted such calculation, and thereafter shall
be entitled to exercise this Warrant only for the number of shares of Warrant
Stock so calculated (but subject to adjustment as provided in Section 4 below
and forfeiture as provided in Section 9 below).  If the Holder provides the
Company with such Protest Notice, such Warrant Calculation shall be submitted to
a nationally recognized accounting firm not affiliated with either the Company
or the Holder, and the Warrant Calculation as determined by such accounting firm
shall be binding upon the parties.  The accounting firm shall review the Warrant
Calculation and make any appropriate adjustment thereto within thirty (30) days
after submission to it.  The expenses of such accounting firm shall be split
evenly by the parties.

          (d)  The calculations described in Section 2(c) herein shall be made
irrespective of, and the number of shares of Warrant Stock issuable upon
exercise hereof shall not be affected by, (i) the Company's failure to submit a
Communications License Agreement for a Building prior to the expiration of the
Rollout Period, or (ii) the Company's loss of Exclusive or Semi-Exclusive Rights
as the result of the failure of the Company to complete installation within a
Building or Buildings prior to the expiration of the Rollout Period.

          (e)  The Holder may exercise this Warrant by presentation and
surrender of this Warrant to the Company at its principal office, or to its
stock transfer agent, if any, with the Warrant Exercise Form attached hereto
duly executed and accompanied by payment (either in cash or by certified or
official bank check, payable to the order of the Company, or by wire transfer of
immediately available funds to an account designated by the Company) of the
Exercise Price for the number of shares of Warrant Stock specified in such form.

          (f)  Following the IPO, in connection with any requested conversion of
this Warrant, and in lieu of the payment of the Exercise Price in cash, the
Company shall convert this Warrant, in whole or in part and at any time or
times, into Warrant Stock (the "Conversion Right"), as follows: Upon exercise of
the Conversion Right, the Company shall deliver to the Holder (without payment
by the Holder of any Exercise Price) that number of shares of Common Stock equal
to the quotient obtained by dividing (x) the difference of (A) the aggregate
Fair Market Value (as defined in Section 4(b)(viii) below) for all Warrant Stock
issuable upon exercise of the Warrants being converted, less (B) the aggregate
Exercise Price for all such Warrant Stock, by (y) the Fair Market Value of one
share of Warrant Stock.

          (g)  Upon receipt by the Company of this Warrant, together with the
Warrant Exercise Form and, in connection with any conversion other than under
Section 2(f), the Exercise Price (the "Exercise Time"), at its office, or by the
stock transfer agent of the Company at its office, the Holder shall be deemed to
be the holder of record of the shares of Common

                                       3
<PAGE>

Stock issuable upon such exercise, notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
shares of Common Stock shall not then be actually delivered to the Holder.

          (h)  The Company will deliver to Holder certificates for Warrant Stock
purchased upon exercise of this Warrant within five (5) business days after the
Exercise Time. Unless all of the purchase rights represented by this Warrant
have been exercised, the Company will prepare a new Warrant, substantially
identical hereto, representing the rights formerly represented by this Warrant
which have not expired or been exercised and will within such five-day period,
deliver such new Warrant to the Holder.

          (i)  The issuance of certificates for Warrant Stock upon exercise of
this Warrant will be made without charge to the Holder for any issuance tax in
respect thereof or other cost incurred by the Company in connection with such
exercise and the related issuance of Warrant Stock. The Holder or its transferee
shall pay any transfer tax payable in respect of a transfer of the Warrant or
the Warrant Stock to a third party.

          (j)  Notwithstanding any other provisions hereof, if an exercise of
any portion of this Warrant is to be made in connection with a public offering
of Common Stock or a merger or other sale of all or substantially all of the
stock or assets of the Company, the exercise of any portion of this Warrant may,
at the election of the Holder, be conditioned upon the consummation of the
public offering or the sale of the Company in which case such exercise shall not
be deemed to be effective until the consummation of such transaction.

     3.  Reservation of Shares. The Company shall at all times authorize and
         ---------------------
reserve for issuance and delivery all shares of Common Stock issuable upon
exercise of this Warrant. All such shares shall be duly authorized and, when
issued upon exercise in compliance with the terms of this Agreement, shall be
validly issued, fully paid and non-assessable. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant, but the Company shall pay the Holder an amount equal to the applicable
Exercise Price multiplied by such fraction in lieu of each fraction of a share
otherwise called for upon any exercise of this Warrant. If at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of this Warrant, the Company will take such corporate
action as may, in the opinion of its counsel, be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purpose. The Company shall take all such actions as may
be necessary to assure that all such shares of Common Stock may be so issued
without violation of any applicable law or governmental regulation or any
requirements of any securities exchange or inter-dealer quotation system upon
which shares of Common Stock may be listed or traded (except for official notice
of issuance which shall be immediately transmitted by Company upon issuance).

     4.   Adjustments.
          -----------

          (a)  Capital Adjustments. If the Company at any time or from time to
               -------------------
time after the date hereof effects a subdivision of the outstanding Common Stock
(by stock split, stock dividend, recapitalization or otherwise) or a combination
the outstanding shares of Common Stock into a smaller number of shares (by
reverse stock split, recapitalization or otherwise), (i)

                                       4
<PAGE>

the Exercise Price in effect immediately before the subdivision or combination
shall be automatically adjusted by multiplying the Exercise Price by a fraction
(the "Capital Adjustment Factor"), (A) the numerator of which is the total
number of shares of Common Stock issued and outstanding immediately prior to the
time of such subdivision or combination, and (B) the denominator of which is the
total number of shares of Common Stock issued and outstanding immediately after
such subdivision or combination, and (ii) the number of shares of Warrant Stock
issuable upon exercise of this Warrant shall be automatically adjusted by
dividing such number of shares by the Capital Adjustment Factor.

          (b)  Below Market Issuances.
               ----------------------

               (i)  In the event that the Company issues or sells shares of
     Common Stock (other than Permitted Issuances, as described below) at a
     price per share below the "Fair Market Value" (as defined herein) of such
     shares (a "Below Market Transaction"), (A) the number of shares of Warrant
     Stock issuable upon exercise of this Warrant shall be adjusted so as to be
     equal to the product obtained by multiplying the number of shares of
     Warrant Stock issuable pursuant to this Warrant prior to the Below Market
     Transaction by a fraction (the "Market Adjustment Factor"), the numerator
     of which shall be (i) the number of shares of Common Stock outstanding
     immediately prior to consummation of the Below Market Transaction plus (ii)
                                                                       ----
     the number of shares of Common Stock issued or sold in the Below Market
     Transaction, and the denominator of which shall be (x) the number of shares
     of Common Stock outstanding immediately prior to the Below Market
     Transaction plus (y) th number of shares of Common Stock that the aggregate
                 ----
     consideration received by the Company in the Below Market Transaction would
     purchase at Fair Market Value, and (B) the Exercise Price shall be adjusted
     so as to be equal to the quotient obtained by dividing the Exercise Price
     in effect prior to the Below Market Transaction by the Market Adjustment
     Factor. For purposes of this subsection, Common Stock shall be deemed to
     include that number of shares of Common Stock that would be obtained
     assuming (A) the conversion of any securities of the Company which, by
     their terms, are convertible into or exchangeable for Common Stock, and (B)
     the exercise of all options to purchase or rights to subscribe for Common
     Stock or securities which, by their terms, are convertible into or
     exchangeable for Common Stock.

               (ii) If the Company in any manner issues or sells any stock or
     securities directly or indirectly convertible into or exchangeable for
     Common ("Convertible Securities"), other than Convertible Securities that
     are Issuances, and the price per share for which Common Stock is issuable
     upon conversion or exchange thereof is less than the Fair Market Value of
     the Common Stock immediately prior to the time of such issue or sale, then,
     for purposes of Section 4(b)(i), the total maximum number of shares of
     Common Stock issuable upon conversion or exchange of such Convertible
     Securities shall be deemed to have been issued and sold by the Company at
     the time of the issuance or sale of such Convertible Securities for such
     price per share. For the purposes of this paragraph, the "price per share
     for which Common Stock is issuable" shall be determined by dividing (A) the
     total amount received or receivable by the Company as consideration for the
     issue or sale of such Convertible Securities, plus the minimum aggregate
     amount of additional consideration, if any, payable to the Company upon the
     conversion or exchange thereof, by (B) the total

                                       5
<PAGE>

     maximum number of shares of Common Stock issuable upon the conversion or
     exchange of all such Convertible Securities. No further adjustment of the
     number of shares of Warrant Stock issuable upon exercise of this Warrant or
     the Exercise Price shall be made when Common Stock is actually issued upon
     the conversion, exercise or exchange of such Convertible Securities.

               (iii) If the Company in any manner grants or sells any rights,
     warrants or options to subscribe for or purchase Common Stock or
     Convertible Securities ("Options"), other than options that are Permitted
     Issuances, and the price per share for which Common Stock is issuable upon
     the exercise of such Options, or upon conversion or exchange of any
     Convertible Securities issuable upon exercise of such Options, is less than
     the Fair Market Value of the Common Stock immediately prior to the time of
     the granting or sale of such Options, then, for purposes of Section
     4(b)(i), the total maximum number of shares of Common Stock issuable upon
     the exercise of such Options or upon conversion or exchange of the total
     maximum amount of such Convertible Securities issuable upon the exercise of
     such Options shall be deemed to have been issued and sold by the Company at
     the time of the granting or sale of such Options for such price per share.
     For purposes of this paragraph, the "price per share for which Common Stock
     is issuable" shall be determined by dividing (A) the total amount, if any,
     received or receivable by the Company as consideration for the granting or
     sale of such Options, plus the minimum aggregate amount of additional
     consideration payable to the Company upon exercise of all such Options,
     plus in the case of such Options which relate to Convertible Securities,
     the minimum aggregate amount of additional consideration, if any, payable
     to the Company upon the issuance or sale of such Convertible Securities and
     the conversion or exchange thereof, by (B) the total maximum number of
     shares of Common Stock issuable upon the exercise of such Options or upon
     the conversion or exchange of all such Convertible Securities issuable upon
     the exercise of such Options. No further adjustment of the number of shares
     of Warrant Stock issuable upon exercise of this Warrant or the Exercise
     Price shall be made when Convertible Securities are actually issued upon
     the exercise of such Options or when Common Stock is actually issued upon
     the exercise of such Options or the conversion or exchange of such
     Convertible Securities.

               (iv) If the purchase price provided for in any Options, the
     additional consideration, if any, payable upon the conversion or exchange
     of any Convertible Securities or the rate at which any Convertible
     Securities are convertible into or exchangeable for Common Stock changes at
     any time, the number of shares of Warrant Stock issuable upon exercise of
     this Warrant and the Exercise Price in effect at the time of such change
     shall be immediately adjusted to the applicable number of shares of Warrant
     Stock issuable upon exercise of this Warrant and the Exercise Price which
     would have been in effect at such time had such Options or Convertible
     Securities still outstanding provided for such changed purchase price,
     additional consideration or conversion rate, as the case may be, at the
     time initially granted, issued or sold.

               (v) Upon the expiration of any Option or the termination of any
     right to convert or exchange any Convertible Security without the exercise
     of any such Option or right, the Exercise Price then in effect hereunder
     shall be adjusted immediately to the

                                       6
<PAGE>

     applicable number of shares of Warrant Stock issuable upon exercise of this
     Warrant and the Exercise Price which would have been in effect at the time
     of such expiration or termination had such Option or Convertible Security,
     to the extent outstanding immediately prior to such expiration or
     termination, never been issued.

               (vi) If any Common Stock or Convertible Security is issued or
     sold or deemed to have been issued or sold for cash, the consideration
     received therefor shall be deemed to be the amount received by the Company
     therefor (net of discounts, commissions and related expenses). If any
     Common Stock or Convertible Security is issued or sold for a consideration
     other than cash, the amount of the consideration other than cash received
     by the Company shall be the fair value of such consideration. If any Common
     Stock or Convertible Security is issued to the owners of the non-surviving
     entity in connection with any merger in which the Company is the surviving
     corporation, the amount of consideration therefor shall be deemed to be the
     fair value of such portion of the net assets and business of the non-
     surviving entity as is attributable to such Common Stock or Convertible
     Security, as the case may be. The fair value of any consideration other
     than cash and securities shall be determined jointly by the Company and the
     Holder. If such parties are unable to reach agreement within a reasonable
     period of time, the fair value of such consideration shall be determined by
     an independent appraiser experienced in valuing such type of consideration
     jointly selected by the Company and the Holder. The determination of such
     appraiser shall be final and binding upon the parties, and the reasonable
     fees and expenses of such appraiser shall be borne by the Company. In case
     any Convertible Security is issued in connection with the issue or sale of
     other securities of the Company, together comprising one integrated
     transaction, the board of directors of the Company shall make a good faith
     determination of the portion of the consideration received therefor
     allocable as consideration for which the Company issued the Convertible
     Security.

               (vii) The number of shares of Common Stock outstanding at any
     given time shall not include shares owned or held by or for the account of
     the Company or any subsidiary, and the disposition of any shares so owned
     or held shall be considered an issue or sale of Common Stock.

               (viii) The term "Permitted Issuances," as used herein, means
     issuances to employees pursuant to the Company's management equity plans,
     as approved from time to time by the Company's Board of Directors. For
     purposes of this Section 4(b) and Section 2(f), if the Common Stock is
     traded on the Nasdaq Stock Market or other inter-dealer quotation system or
     is listed on any national securities exchange, the "Fair Market Value" of
     the Common Stock shall be average of the last reported sales prices of the
     Common Stock as reported by Nasdaq or, if the Common Stock is listed on a
     national securities exchange, the last reported sales prices of the Common
     Stock on such exchange, for the twenty (20) trading days immediately
     preceding the date of such sale or issuance of Common Stock. If the Common
     Stock is not so listed or traded, the Fair Market Value of the Common Stock
     shall be determined jointly by the Company and the Holder. If such parties
     are unable to reach agreement within 30 days of the date of such sale or
     issuance, the Fair Market Value of the Common Stock shall be determined by
     an independent appraiser jointly selected by the Company and the Holder.
     The

                                       7
<PAGE>

     determination of such appraiser shall be final and binding upon the
     parties, and the reasonable fees and expenses of such appraiser shall be
     borne by the Company.

          (c)  Reorganizations, Mergers, Consolidations or Sales of Assets.
               -----------------------------------------------------------
If at any time or from time to time after the date hereof, there is a capital
reorganization of the Common Stock (other than a recapitalization, subdivision,
combination, reclassification, exchange or substitution of shares provided for
elsewhere in this Section 4), as a part of such capital reorganization,
provision shall be made so that the Holder shall thereafter be entitled to
receive upon exercise of this Warrant the number of shares of stock or other
securities or property of the Company to which a holder of the number of shares
of Common Stock deliverable upon exercise of this Warrant would have been
entitled in connection with such capital reorganization, subject to adjustment
in respect of such stock or securities by the terms thereof. In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 4 with respect to the rights of the Holder after the capital
reorganization to the end that the provisions of this Section 4 (including
adjustment of the Exercise Price and the number of shares of Warrant Stock
issuable upon exercise of this Warrant then in effect) shall be applicable after
that event and be as nearly equivalent as practicable.

          (d)  Notice to Warrant Holder of Adjustment. At any time following the
               --------------------------------------
delivery to Holder of a Calculation Notice, whenever the number of shares of
Warrant Stock issuable upon exercise of this Warrant or the Exercise Price is
adjusted as herein provided, the Company shall cause to be mailed to the Holder
in accordance with the provisions of this Section 4 a notice (i) stating that an
event giving rise to an adjustment hereunder has occurred, (ii) setting forth
the adjusted number of shares of Warrant Stock and the adjusted Exercise Price
and (iii) showing in reasonable detail the computations and the facts upon which
such adjustments are based. The Holder shall be entitled to review such
calculation (as well as any "Fair Market Value" calculation made by the board of
directors pursuant to Section 4(b)) and render any objections in the manner
provided in Section 4(b)(viii).

     5.   Restrictions on Transfer.
          ------------------------

          (a)  The Holder hereby acknowledges that neither this Warrant nor any
of the securities that may be acquired upon exercise of this Warrant have been
registered or qualified under the 1933 Act or under the securities laws of any
state. The Holder acknowledges that upon exercise of this Warrant the securities
to be issued upon such exercise may be subject to applicable federal and state
securities (or other) laws requiring registration, qualification or approval of
governmental authorities before such securities may be validly issued or
delivered upon notice of such exercise. The Holder agrees that the issuance of
such securities may be deferred until the issuance or sale of such securities
shall be lawful in all respects. The restrictions imposed by this Section 5 upon
the exercise of this Warrant shall cease and terminate as to any particular
shares of Warrant Stock (i) when such securities shall have been effectively
registered and qualified under the 1933 Act and all applicable state securities
laws and disposed of in accordance with the registration statement covering such
securities, or (ii) when, in the opinion of counsel for the Company, such
restrictions are no longer required in order to ensure compliance with the 1933
Act and all applicable state securities laws.

                                       8
<PAGE>

          (b)  Notwithstanding the provisions of Section 5(a), the Holder may
not offer, sell, contract to sell or otherwise dispose of any Warrant Stock
within one hundred eighty (180) days after the date of any final prospectus
related to the IPO except with the written consent of the Company and managing
underwriter or underwriters for such offering.

          (c)  Prior to the IPO, and except for the Permitted Transfers
described in Section 15(a), at least 30 days prior to making any sale or
transfer of any of Warrant Stock, the Holder shall deliver a written notice (the
"Offer Notice") to the Company. The Offer Notice shall disclose in reasonable
detail the proposed number of shares of Warrant Stock to be transferred and the
proposed terms and conditions of the transfer. The Company may elect to purchase
all, but not less than all, of the shares of Warrant Stock specified in the
Offer Notice at the price and on the terms specified therein by delivering
written notice of such election to the Holder as soon as practical but in any
event within 30 days after the delivery of the Offer Notice. To the extent that
the Company does not elect to purchase all of the shares of Warrant Stock being
offered, the Holder may, within 90 days after the expiration of the Company's
election period, transfer such shares of Warrant Stock to one or more third
parties at a price no less than the price per share specified in the Offer
Notice and on terms no more favorable to the transferees than offered to the
Company in the Offer Notice. The purchase price specified in the Offer Notice
shall be payable solely in cash at the closing of the transaction.

     6.   Piggy-Back Registration Rights.
          ------------------------------

          (a)  If the Company has registered or has determined to register any
of its securities for its own account or for the account of other security
holders of the Company on any registration form (other than Form S-4 or S-8)
which permits the inclusion of the Warrant Stock (a "Piggyback Registration"),
the Company will give the Holder written notice thereof promptly and, subject to
Section 6(c), shall include in such registration all the Warrant Stock requested
to be included therein pursuant to the written request of the Holder received
within twenty (20) days after delivery of the Company's notice.

          (b)  If the Piggyback Registration relates to an underwritten public
offering, the Company shall so advise the Holder as a part of the written notice
given pursuant to Section 6(a). In such event, the right of the Holder to
participate in such registration shall be conditioned upon Holder's
participation in such underwriting in accordance with the terms and conditions
thereof. Should the Holder propose to distribute its Warrant Stock through such
underwriting, it shall (together with the Company) enter into an underwriting
agreement in customary form with the representative of the underwriter or
underwriters selected by the Company.

          (c)  If such proposed Piggyback Registration is an underwritten
offering and the managing underwriter for such offering advises the Company that
the securities requested to be included therein exceeds the amount of securities
that can be sold in such offering, any (i) securities to be sold by the Company
in such offering and (ii) Registrable Securities (as such term is defined in the
Company's Third Amended and Restated Stockholders Agreement dated October 8,
1999) shall have priority over the Holder's Warrant Stock, and the number of
shares to be included by the Holder in such registration shall be reduced pro
rata on the basis of the percentage of the outstanding Warrant Stock held by the
Holder (assuming the exercise of all warrants held by the Holder) and all other
holders exercising equivalent registration rights.

                                       9
<PAGE>

          (d)  If the Holder requests but is unable to register all shares of
Warrant Stock in a Piggyback Registration within eighteen (18) months following
the IPO, the Holder shall have the option to include such Warrant Stock in a
Demand Registration pursuant to Section 7.

     7.   Demand Registration Rights.
          --------------------------

          (a)  Should the Holder request but be unable to include in a Piggyback
Registration all shares of Warrant Stock within eighteen (18) months following
the IPO as contemplated in Section 6 herein, the holders of Warrants or Warrant
Stock representing at least 50% of the aggregate shares of Warrant Stock
issuable upon exercise of this Warrant (including any Holders of Warrants or
Warrant Stock issuable as a result of an assignment of all or a portion hereof,
in the aggregate, as adjusted pursuant to Section 4) (the "Initiating Holders")
may, if available to the Company, require that the Company effect as many
registrations as the Initiating Holders may request under the Securities Act
utilizing a Form S-3 or any similar form (a "Demand Registration").

          (b)  The Company shall file a registration statement with respect to
such Demand Registration requested pursuant to Section 7(a) as soon as
practicable after receipt of the demand of the Initiating Holders; provided,
however, that if in the good faith judgment of the Board of Directors of the
Company, such registration would be seriously detrimental to the Company in that
such registration would interfere with a material corporate transaction and the
Board of Directors concludes, as a result, that it is advisable to defer the
filing of such registration statement at such time (as evidenced by an
appropriate resolution of the Board), then the Company shall have the right to
defer such filing for the period during which such registration would be
seriously detrimental; provided, however, that (i) the Company may not defer the
filing for a period of more than one hundred eighty (180) days after receipt of
any demand of the Initiating Holders and (ii) the Company shall not exercise its
right to defer a Demand Registration more than once.

          (c)  Notwithstanding any provision to the contrary contained in this
Warrant, a Holder's registration rights under Sections 6 and 7 shall
automatically terminate when all of the Warrant Stock owned by such Holder may
immediately be sold under Rule 144 under the 1933 Act.

     8.   Registration Procedures.
          -----------------------

     8.1  In the case of each registration effected by the Company pursuant to
Sections 6 or 7 of this Warrant, the Company will keep the Holder advised in
writing as to the initiation of such registration and as to the completion
thereof.  At its expense, the Company will use its best efforts to:

          (a) cause such registration to be declared effective by the Securities
and Exchange Commission (the "Commission") and, in the case of a Demand
Registration, keep such registration effective for a period of one hundred
eighty (180) days or until the Holder has completed the distribution described
in the registration statement relating thereto, whichever first occurs;

                                       10
<PAGE>

          (b)  prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement (including post-effective amendments) as may be
necessary to comply with the provisions of the 1933 Act with respect to the
disposition of all securities covered by such registration statement;

          (c)  obtain appropriate qualifications of the securities covered by
such registration under state securities or "blue sky" laws in such
jurisdictions as may be requested by the Holder; provided, however, that the
Company shall not be required to file a general consent to service of process in
any jurisdiction in which it is not otherwise subject to service in order to
obtain any such qualification;

          (d)  furnish such number of prospectuses and other documents incident
thereto, including any amendment of or supplement to the prospectus, as the
Holder from time to time may reasonably request;

          (e)  notify the Holder, at any time when a prospectus relating thereto
is required to be delivered under the 1933 Act, of the happening of any event as
a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or incomplete in the light of the
circumstances then existing, and at the request of any such holder, prepare and
furnish to such holder a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading or
incomplete in the light of the circumstances then existing;

          (f)  cause all Warrant Stock covered by such registration to be listed
on each securities exchange or inter-dealer quotation system on which similar
securities issued by the Company are then listed;

          (g)  provide a transfer agent and registrar for all Warrant Stock
covered by such registration and a CUSIP number for all such securities, in each
case not later than the effective date of such registration;

          (h)  otherwise comply with all applicable rules and regulations of the
Commission, and make available to its security holders, as soon as reasonably
practicable, an earnings statement covering a period of at least twelve months,
but not more than eighteen months, beginning with the first month after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the 1933 Act; and

          (i)  in connection with any underwritten Demand Registration, the
Company will (A) enter into an underwriting agreement reasonably satisfactory to
the Company and the Holder containing customary underwriting provisions,
including indemnification and contribution provisions, and (B) cooperate with
such underwriters and use its reasonable

                                       11
<PAGE>

commercial efforts to assist such underwriters in connection with the offering
and sale of Warrant Stock.

     8.2  Other Obligations. With a view to making available the benefits
          -----------------
of certain rules and regulations of the Securities and Exchange Commission which
may facilitate the registration of Warrant Stock or permit the sale of Warrant
Stock to the public without registration, the Company agrees to:

          (a)  after its initial registration under the 1933 Act, exercise
reasonable commercial efforts to cause the Company to be eligible to utilize
Form S-3 (or any similar form) for the registration of Warrant Stock;

          (b)  at such time as any Warrant Stock is eligible for transfer under
Rule 144(k), upon the request of the holder of such Warrant Stock, remove any
restrictive legend from the certificates evidencing such securities at no cost
to such holder;

          (c)  make and keep available public information as defined in Rule 144
under the 1933 Act at all times from and after ninety (90) days following its
initial registration under the 1933 Act;

          (d)  file with the Commission in a timely manner all reports and other
documents required of the Company under the 1933 Act and the Securities Exchange
Act of 1934 (the "1934 Act") at any time after it has become subject to such
reporting requirements; and

          (e)  furnish any holder of Warrant Stock upon request a written
statement by the Company as to its compliance with the reporting requirements of
Rule 144 (at any time from and after ninety (90) days following the IPO), and of
the 1933 Act and the 1934 Act (at any time after it has become subject to such
reporting requirements), a copy of the most recent annual or quarterly report of
the Company, and such other reports and documents as a holder of Warrant Stock
may reasonably request in availing itself of any rule or regulation of the
Securities and Exchange Commission (including Rule 144A) allowing a holder of
Warrant Stock to sell any such securities without registration.

     9.  Forfeiture of Warrants and Return of Proceeds.
         ---------------------------------------------

          (a)  If a Building covered by a License Agreement is sold and the
     purchaser of the Building fails to assume the License associated with such
     Building at the closing of such sale (a "Sale"), at the Company's written
     request, the Holder shall forfeit or return to the Company, as applicable,
     the right to acquire the Warrant Stock issuable upon exercise of this
     Warrant or, if this Warrant has been exercised, the Warrant Stock issued,
     which is attributable to the GLA from such Building, together with any
     dividends paid on such Warrant Stock, or if Holder has transferred such
     Warrant Stock, any proceeds resulting from the transfer of the Warrant
     Stock (collectively, the "Warrant Amount"), as set forth below:

               (i)  If a Sale occurs during the period commencing on the date of
          the Master Agreement and ending on the third (3rd) anniversary
          thereof, at the Company's written request, the Holder shall forfeit or
          return 100% of the Warrant Amount;

                                       12
<PAGE>

                    (ii) If a Sale occurs during the period following the third
          (3/rd/) anniversary of the date of the Master Agreement, at the
          Company's written request, the Holder shall forfeit or return to the
          Company the Warrant Amount as set forth below:

-------------------------------------------------------------------------------
After the 3/rd/ anniversary but prior to the 4/th/       80% of Warrant Amount
anniversary of the date of the Master Agreement
-------------------------------------------------------------------------------
On or after the 4/th/anniversary but prior to            60% of Warrant Amount
the 5/th/ anniversary of the date of the Master
Agreement
-------------------------------------------------------------------------------
On or after the 5/th/ anniversary but prior to the       40% of Warrant Amount
6/th/ anniversary of the date of the Master
Agreement
--------------------------------------------------------------------------------
On or after the 6/th/ anniversary but prior to the       20% of Warrant Amount
7/th/ anniversary of the date of the Master
Agreement
--------------------------------------------------------------------------------
On or after the 7/th/ anniversary of the date of          0% of Warrant Amount
the Master Agreement
--------------------------------------------------------------------------------

If Warrant Stock has not yet been issued at the time of a Sale, the Warrant
Amount applied to such Building shall be excluded from any calculation of
Warrant Stock to be issued upon any Exercise Event.  Upon surrender by Holder of
any Warrant Amount in the form of shares of Warrant Stock, the Company shall
refund to the Holder the Exercise Price paid to the Company attributable to such
surrendered Warrant Amount.  Any Warrant Amount payable by Holder hereunder in
the form of proceeds from the sale of Warrant Stock shall be net of the Exercise
Price paid to the Company for such shares of Warrant Stock.

          (b)  Notwithstanding the provisions of Section 9(a), no portion of the
Warrant Amount with respect to the GLA of a Building shall be returned or
forfeited if and to the extent that, within six (6) months after the Sale of the
Building, Holder enters or has previously entered into a License Agreement with
the Company, upon the terms set forth in the Master Agreement or upon other
terms reasonably satisfactory to the Company, for one or more other buildings
reasonably satisfactory to the Company not covered by the Master Agreement to
the extent of the GLA of such building or buildings.

          (c)  The provisions of Section 9(a) shall terminate and be of no
further effect upon (i) the expiration or non-renewal of the Master Agreement in
accordance with its terms or (ii) the termination of the Master Agreement as a
result of a breach of the Master Agreement by the Company. The provisions of
Section 9(a) shall apply only with respect to the initial sale of a Building by
Holder; any sale of such Building by a subsequent owner thereof shall have no
effect on the rights of the Holder hereunder.

          (d)  If Warrant Stock has been issued, and upon a Sale the Holder
fails to deliver to the Company the forfeited Warrant Amount (whether in the
form of a stock certificate or cash proceeds), the Company shall be entitled to
(i) cancel any such certificates registered in the Holder's name representing
the Warrant Stock on the books and records of the Company (at which time such
Warrant Stock shall be deemed canceled without any additional required action

                                       13
<PAGE>

on behalf of the Company or the Holder), and (but only to the extent necessary
after taking the action provided in clause (i) above) (ii) set off against any
amounts which the Company may owe Holder pursuant to the terms of the Master
Agreement the amount of such cash proceeds.

          (e)  In the event of the transfer or assignment of a portion of this
Warrant in accordance with Section 15 hereof, the Holder will provide written
notice to the Company specifying the particular Building or Buildings (and the
GLA thereof) to which the transferred Warrants relate. Thereafter, if any sale
of such Building or Buildings occurs such that any Warrant Amount becomes
payable to the Company pursuant to the provisions of this Section 9, the entire
amount of such Warrant Amount payable shall be forfeited by the holder (or
holders, pro rata) of the transferred Warrants in accordance with the forfeiture
provisions thereof, and any rights under this Warrant or shares of Warrant Stock
held by the transferor with respect to any other Building or Buildings shall not
be subject to forfeiture upon such sale; provided, however, that in the event
that such transferee has exercised its rights under the transferred Warrant and
sold the shares of Warrant Stock acquired thereupon (and such Warrant Amount is
payable to the Company by such transferee in cash), the transferor of the
Warrant shall remain liable for, and shall pay to the Company, such Warrant
Amount to the extent the Company is unable within 20 days after written demand
to the transferee, with a copy to the transferor, to collect such Warrant Amount
from the transferee.

     10.  Additional Offers of Warrant Rights.  Subject to the provisions of
          -----------------------------------
Section 4 of this Warrant, the Company is authorized to offer to other qualified
property owners similar warrant rights as provided in this Warrant prior to the
filing of its initial registration statement in connection with the IPO or
following the closing of the IPO.

     11.  Holder Representations and Warranties.
          -------------------------------------

          (a)  The Holder has all necessary power and authority under all
applicable provisions of law to execute and deliver this Warrant and to carry
out its provisions. All actions on Holder's part required for the lawful
execution and delivery of this Warrant have been taken.

          (b)  The Holder understands that neither the Warrant nor the Warrant
Stock has been registered under any state securities act or the 1933 Act. The
Holder also understands that the Warrants and the Warrant Stock are being
offered and sold pursuant to an exemption from registration contained in
applicable state securities acts and the 1933 Act based in part upon the
Holder's representations contained in this Warrant.

          (c)  The Holder has substantial experience in evaluating and investing
in private placement transactions of securities in companies similar to the
Company so that Holder is capable of evaluating the merits and risks of its
investment in the Company and has the capacity to protect its own interests. The
Holder must bear the economic risk of this investment indefinitely unless the
Warrants (or the Warrant Stock) are registered pursuant to the 1933 Act, or an
exemption from registration is available. The Holder understands that the
Company has no present intention of registering the Warrants, the Warrant Stock
or any shares of its Common Stock. The Holder also understands that there is no
assurance that any exemption from registration under the 1933 Act will be
available and that, even if available, such exemption may not allow the Holder
to transfer all or any portion of the Warrants or the Warrant Stock under the

                                       14
<PAGE>

circumstances, in the amounts or at the times the Holder might propose. The
Holder can bear the economic risk of losing its entire investment in the
Company.

          (d)  The Holder is acquiring the Warrants and the Warrant Stock for
Holder's own account or for the account of an Affiliate or Owner for investment
only, and not with a view towards their resale or distribution in violation of
applicable securities laws.

          (e)  The Holder represents that, by reason of Holder's or of its
management's business or financial experience, the Holder has the capacity to
protect its own interests in connection with the transactions contemplated in
this Warrant. Further, the Holder is aware of no publication of any
advertisement in connection with the transactions contemplated by the Warrant.

          (f)  The Holder represents that Holder is an accredited investor
within the meaning of Regulation D under the 1933 Act.

          (g)  The Holder has had an opportunity to discuss the Company's
business, management and financial affairs with directors, officers and
management of the Company. The Holder has also had the opportunity to ask
questions of, and receive answers from, the Company and its management regarding
the terms and conditions of this investment. The Holder has had an adequate
opportunity to inspect and copy all material documents relating to the Company
which it has requested.

     12.  Company Representations and Warranties.
          --------------------------------------

     The Company hereby represents and warrants to, and agrees with, each
Purchaser as follows:

          (a)  Organization.  The Company is a corporation duly organized,
               ------------
validly existing and in good standing under the laws of the State of Delaware.
The Company has all requisite corporate power and authority to own and operate
its properties and assets, to execute and deliver this Warrant to issue the
shares of Warrant Stock upon exercise of the Warrant, to carry out the other
provisions of this Warrant and the transactions contemplated hereby, and to
carry on its business as presently conducted and as presently proposed to be
conducted.

          (b)  Capitalization.
               --------------

               (i)  The authorized capital stock of the Company as of November
     16, 1999, consists of (i) Ten Million Eight Hundred Ninety-Four Thousand
     Seventy-One and 62/100 (10,894,071.62) shares of Common Stock, Five Hundred
     Eighty Five Thousand Nine Hundred Eighty and 46/100 (585,980.46) shares of
     which are issued and outstanding, and (ii) Seven Million Six Hundred
     Eighty-Seven Thousand Seven Hundred Four and 16/100 (7,687,704.16) shares
     of Preferred Stock, of which One Million Two Hundred Eleven Thousand One
     Hundred Forty (1,211,140) are designated as Series A Preferred Stock (the
     "Series A Preferred"), all of which are issued and outstanding, One Million
     Nine Hundred Nineteen Thousand One Hundred Eighty Eight (1,919,188) are
     designated as Series B Preferred Stock (the "Series B Preferred"), One
     Million Three Hundred Thirty Nine Thousand Five Hundred Seventy Five
     (1,339,575) of which are

                                       15
<PAGE>

     issued and outstanding, Five Hundred Seventy Nine Thousand Six Hundred
     Thirteen (579,613) are designated as Series B-1 Preferred Stock (the
     "Series B-1 Preferred"), all of which are issued and outstanding, Three
     Million Nine Hundred Seventy Seven Thousand Seven Hundred Sixty Three and
     16/100 (3,977,763.16) are designated as Series C Preferred Stock (the
     "Series C Preferred"), Two Million Eight Hundred Nineteen Thousand Eight
     Hundred Sixty-Eight and 39/100 (2,819,868.39) of which are issued and
     outstanding (the Series A Preferred, Series B Preferred, Series B-1
     Preferred and Series C Preferred are collectively referred to herein as the
     "Preferred Stock").

               (ii) Except for the shares of Preferred Stock described in
     12(b)(i) and (i) 1,200,000 shares of Common Stock reserved by the Company
     for issuance pursuant to warrants granted in connection with the Company's
     current licensing efforts, (ii) 2,000,000 shares of Common Stock reserved
     for issuance in connection with the Company's Management Option Plan, and
     (iii) 710,526.31 shares of Series C Preferred Stock the Company has
     committed to issue as part of its Series C Preferred Stock Offering, as of
     November 16, 1999, the Company does not have outstanding any capital stock
     or other securities convertible into or exchangeable for any shares of its
     capital stock.

          (c)  Authorization; Binding Obligations. All corporate action on the
               ----------------------------------
part of the Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Warrant and each other document or
instrument executed by it, or any of its officers, in connection herewith or
therewith or pursuant hereto or thereto, the performance of all obligations of
the Company under the Warrant and for the authorization, sale, issuance and
delivery of the shares issuable upon exercise of the Warrant has been taken.
When issued in compliance with the provisions of this Warrant, the shares will
be duly authorized, validly issued, fully paid and nonassessable, free of any
liens, preemptive or similar rights, or, except as set forth herein, any other
encumbrances and issued in compliance with all applicable state and federal
securities laws. This Warrant has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligations of the Company
enforceable in accordance with its terms.

          (d)  No Violations. The execution, delivery and performance of this
               -------------
Warrant and the performance by the Company of its obligations hereunder do not
and will not conflict with or violate any provision of the certificate of
incorporation or bylaws of the Company or any law, statute, rule or regulation
or any agreement, contract or instrument or any order, judgment or decree to
which the Company is subject or by which any of its assets are bound.

          (e)  No Other Representations or Warranties. The representations and
               --------------------------------------
warranties made by the Company in this Warrant supersede any prior statements,
representations and warranties of any person with respect to the Company or the
transactions contemplated hereby. The representations and warranties of the
Company in this Warrant are the only representations and warranties by the
Company upon which Holder may rely in connection with transactions contemplated
by this Warrant.

     13.  Legends.  Unless (i) the shares of Warrant Stock have been registered
          -------
under the 1933 Act, or (ii) in the opinion of counsel for the Company such
legend is no longer required in

                                       16
<PAGE>

order to ensure compliance with the 1933 Act and all applicable state securities
laws, upon the issuance of any of the shares of Warrant Stock, all certificates
representing such shares shall bear on the face thereof substantially the
following legend:

     THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE
     "SECURITIES") HAVE BEEN ISSUED AND SOLD IN RELIANCE UPON AN
     EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933
     (THE "1933 ACT") AND APPLICABLE STATE SECURITIES LAWS. THE
     SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD OR TRANSFERRED
     OTHER THAN (i) PURSUANT TO AN EFFECTIVE REGISTRATION OR AN
     EXEMPTION THEREFROM UNDER THE 1933 ACT AND APPLICABLE STATE
     SECURITIES LAWS, AND (ii) UPON RECEIPT BY THE ISSUER OF
     EVIDENCE SATISFACTORY TO IT OF COMPLIANCE WITH THE 1933 ACT
     AND THE APPLICABLE SECURITIES LAWS OF ANY OTHER
     JURISDICTION. THE ISSUER SHALL BE ENTITLED TO REQUIRE AN
     OPINION OF COUNSEL SATISFACTORY TO IT WITH RESPECT TO
     COMPLIANCE WITH THE ABOVE LAWS. IN MAKING AN INVESTMENT
     DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE
     PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF
     THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THESE
     SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
     SECURITIES COMMISSION OR REGULATORY AUTHORITY. ANY
     REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
     INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR
     THE FINANCIAL RISKS OF THEIR INVESTMENT IN THESE SECURITIES
     FOR AN INDEFINITE PERIOD OF TIME.

     Additionally, prior to the IPO all certificates representing
     shares of Warrant Stock shall bear on the face thereof
     substantially the following legend:

     THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
     CERTAIN TERMS AND PROVISIONS OF A WARRANT AGREEMENT
     DATED______________, 1999, WHICH PROVIDES, AMONG OTHER
     THINGS, FOR RESTRICTIONS ON THE TRANSFER OF SUCH SHARES. A
     COPY OF SUCH WARRANT AGREEMENT IS ON FILE AT THE PRINCIPAL
     OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON REQUEST TO
     ANY HOLDER OF THE SHARES REPRESENTED BY THIS CERTIFICATE.

     14.  Notices of Record Date, Etc.  In case:
          ---------------------------

          (a)  the Company shall establish a record date for the holders of its
Common Stock for the purpose of entitling them to receive any dividend or other
distribution, or any right to subscribe for, purchase or otherwise acquire any
shares of stock of any class or any other securities or to receive any other
right;

                                       17
<PAGE>

          (b)  of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation, any share exchange for
shares of capital stock of another corporation or any conveyance of all or
substantially all of the assets of the Company to another corporation;

          (c)  of any voluntary or involuntary dissolution, liquidation or
winding up of the Company; or

          (d)  the Company shall enter into a letter of intent or agreement with
respect to a transaction by which all of the outstanding shares of Common Stock
of the Company are to be acquired by a third party;

then the Company shall mail or cause to be mailed to the Holder at the time
outstanding a notice specifying, as the case may be, (i) the date on which a
record is to be taken for the purpose of such dividend, distribution or rights,
and stating the amount and character of such dividend, distribution or rights,
(ii) the date on which such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding up is to take place, and
the time, if any is to be fixed, as to which the holders of record of Common
Stock shall be entitled to exchange their shares for securities or other
property deliverable upon the completion of such transaction, or (iii) the
closing of the acquisition by a third party of all of the outstanding shares of
Common Stock.  Such notice shall be mailed as soon as practicable after the
occurrence or likelihood of such event is publicly disclosed.

     15.  Transfer and Assignment.
          -----------------------

          (a)  This Warrant and all rights hereunder may be transferred, in
whole or in part, without charge to the Holder, upon surrender of this Warrant
with a properly executed Assignment (in the form attached hereto) and written
notice specifying the particular Buildings and GLA to which the assignment
relates at the principal office of the Company. Notwithstanding the foregoing,
prior to the consummation of the IPO, without the consent of the Company (which
consent shall not be unreasonably withheld), this Warrant and any part hereof
may be transferred only (i) to an Affiliate of Holder or an Owner of any
Building, (ii) to any direct or indirect shareholder, partner, member of other
equity holder or lender of such Owner, (iii) any successor by merger of Holder,
of any Affiliate of Holder or of any Owner or any subsidiary of such successor
by merger, or (iv) any entity acquiring all or any portion of the assets of
Holder (each, a "Permitted Transfer"). Prior to any assignment or transfer
hereunder the Holder must provide to the Company evidence satisfactory to the
Company that the proposed transfer will be effected in compliance with all
applicable laws, including without limitation federal and state securities laws,
and that the transferring Holder, notwithstanding the transfer, remains
primarily and directly bound by, and that the transferee agrees to be bound by,
the terms of this Warrant. The Company reserves the right to consent to any such
transfer if in its reasonable opinion, or the opinion of its counsel, the
transfer would have an adverse effect on the Company's ability to complete on a
timely basis its IPO. In no event will the Company permit any transfer after the
Company files its registration statement and prior to the closing of the IPO
unless the transferor can demonstrate to the Company's reasonable satisfaction
that the transferor had discussions with the transferee regarding the proposed
transfer prior to the filing of the registration statement.

                                       18
<PAGE>

          (b)  Except as set forth in paragraph (a) above, neither this Warrant
nor any rights hereunder may be assigned, transferred, pledged or hypothecated
in any way (whether by operation of law or otherwise). This Warrant shall not be
subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of this Warrant contrary to
the provisions of this Warrant shall be null and void and without legal effect.

          (c)  The Company shall maintain at its principal executive offices
books for the registration and the registration of transfer of Warrants. The
Company may deem and treat the registered owner as the absolute owner hereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone) for all purposes and shall not be affected by any notice (other than a
duly executed Assignment) to the contrary.

     16.  Notices.  All notices required hereunder must be in writing and shall
          -------
be deemed given when telefaxed, delivered personally or by overnight delivery
service or within three days after mailing when mailed by certified or
registered mail, return receipt requested, if to the Company, at Fifteen
Piedmont Center, Suite 710, Atlanta, Georgia 30305, Attention: R. Stanley Allen,
with a courtesy copy to Powell, Goldstein, Frazer & Murphy LLP, 191 Peachtree
Street, NE, 16th Floor, Atlanta, Georgia 30303, Attention: William M. Ragland,
Jr., and James K. Wagner, Jr., and if to the Holder, at the address for the
registered Holder as it appears on the books of the Company, or at such other
address of which the Company or Holder has been advised by notice hereunder.

     17.  Rights as a Shareholder.  Unless otherwise expressly provided herein,
          -----------------------
the Holder shall have no rights as a shareholder with respect to any shares
covered by this Warrant until the date of issuance of such shares. No provision
hereof, in the absence of affirmative action by the Holder to purchase Warrant
Stock, and no enumeration herein of the rights or privileges of the Holder shall
give rise to any liability of such holder for the Exercise Price of Warrant
Stock acquirable by exercise hereof or as a stockholder of the Company.

     18.  Lost or Destroyed Warrant.  Upon receipt by the Company of evidence
          -------------------------
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, and upon surrender and cancellation of this
Warrant, if mutilated, the Company shall execute and deliver a new Warrant of
like tenor and date. The Holder agrees with the Company that this Warrant is
issued, and all the rights hereunder shall be held subject to, all of the
conditions, limitations and provisions set forth herein.

     19.  Warrant Exchangeable for Different Denominations.  This Warrant is
          ------------------------------------------------
exchangeable, upon the surrender hereof by the Holder at the principal office of
the Company, for new Warrants of like tenor representing in the aggregate the
purchase rights hereunder, and each of such new Warrants will represent such
portion of such rights as is designated by the Holder at the time of such
surrender. The date that the Company initially issues this Warrant will be
deemed to be the date of this Warrant regardless of the number of times new
certificates representing the unexpired and unexercised rights formerly
represented by this Warrant shall be issued. All Warrants representing portions
of the rights hereunder are referred to herein as the "Warrant" or the
"Warrants."

                                       19
<PAGE>

     20.  Applicable Law.  The Warrant is issued under and shall for all
          --------------
purposes be governed by and construed in accordance with the internal laws of
the State of Delaware, without regard to conflicts of laws principles.

     21.  Entire Agreement.  This Warrant and the other agreements,
          ----------------
certificates and documents delivered in connection with this Agreement contain
the entire agreement among the Company and Holder with respect to the
transactions described herein, and supersede all prior agreements or statements,
written or oral, with respect thereto.

        [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]

                                       20
<PAGE>

     IN WITNESS WHEREOF, the Company and the Holder have caused this Warrant to
be signed as of the day and year first above written.

                                        CYPRESS COMMUNICATIONS, INC.

                                        By:_______________________________
                                        Name:_____________________________
                                        Title:____________________________

                                        [HOLDER]

                                        By:_______________________________
                                        Name:_____________________________
                                        Title:____________________________

                                       21
<PAGE>

                             WARRANT EXERCISE FORM
                             ---------------------

     The undersigned hereby irrevocably elects to exercise the within Warrant to
the extent of purchasing __________ shares of Common Stock of Cypress
Communications, Inc., a Delaware corporation, and hereby makes payment of
$____________ in payment therefor.

                                                ______________________________
                                                Signature

                                                ______________________________
                                                Signature, if jointly held

Date:___________________

********************************************************************************

                       INSTRUCTIONS FOR ISSUANCE OF STOCK
                       ----------------------------------

(if other than to the registered holder of the within Warrant)

Name_________________________________________________________________________
     (Please typewrite or print in block letters)

Address_______________________________________________________________________

Social Security or Taxpayer Identification Number_____________________________

********************************************************************************

                                ASSIGNMENT FORM
                                ---------------

     FOR VALUE RECEIVED, _____________ hereby sells, assigns and transfers unto
_______________________________________________________________________________
               Name (please typewrite or print in block letters)

the right to purchase Common Stock of Cypress Communications, Inc., a Delaware
corporation, represented by this Warrant (which may be a copy if the right to
receive less than all of the shares of Common Stock covered by such Warrant is
being transferred) with respect to the number of shares covered thereby set
forth below and does hereby irrevocably constitute and appoint ________________
______________________________, Attorney, to transfer the same on the books of
the Company with full power of substitution in the premises.

Number of Shares:___________________

Dated:______________________________

                                           Signature___________________________

                                           Signature, if jointly held___________

                                       22

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