Document:

WARRANT AGREEMENT
                                -----------------

     THIS WARRANT AGREEMENT (this "Agreement"), dated as of June 2, 2000, by and
                                   ---------
among  TELSCAPE  INTERNATIONAL,  INC.,  a Texas corporation (the "Company"), TSG
                                                                  -------
CAPITAL  FUND  III,  L.P.,  a  Delaware  limited  partnership and its Affiliates
("TSG"),  Opportunity  Capital Partners II, L.P., a Delaware limited partnership
and  its  Affiliates  ("OCP  II")  and Opportunity Capital Partners III, L.P., a
                        -------
Delaware  limited  partnership and its Affiliates ("OCP III") (collectively TSG,
                                                    -------
OCP  II  and  OCP  III  shall  be  referred  to  as  "Investors").
                                                      ---------

                                R E C I T A L S:
                                ----------------

     WHEREAS,  Investors  were  the holders of Pointe Communications Corporation
("PointeCom")  Class  B  Convertible Senior Preferred Stock, par value $0.01 per
  ---------
share  (the  "Class  B  Preferred"), and warrants to acquire shares of PointeCom
              -------------------
common  stock  (the  "Pointe  Warrants");  and
                      ----------------

     WHEREAS,  PointeCom  entered into that certain Agreement and Plan of Merger
dated  December  31,  1999 (the "Merger Agreement"), by and between the Company,
                                 ----------------
PointeCom  and  PointeCom  Acquisition Corporation, a wholly owned subsidiary of
the  Company  ("Acquisition"), whereby Acquisition is to be merged with and into
                -----------
PointeCom  and  PointeCom  is to become a wholly owned subsidiary of the Company
(the  "Merger");
       ------

     WHEREAS,  as  a result of the consummation of the Merger on the date hereof
and  in  accordance  with the Merger Agreement, the holders of PointeCom Class B
Preferred  are  now holders of Class E Convertible Senior Preferred Stock of the
Company  (the  "Class E Preferred Stock") and hold warrants to acquire shares of
                -----------------------
the  Company's  common  stock  (the  "Warrants");
                                      --------

     WHEREAS,  the  Company  wishes  to  define  the terms and provisions of the
Warrants and the respective rights and obligations thereunder of the Company and
the  holders  of  the  Warrants  (the  "Warrantholders");
                                        --------------

     NOW,  THEREFORE,  in consideration of the foregoing recitals and the mutual
agreements  herein set forth, and for other good and valuable consideration, the
receipt  and  sufficiency  of  which are hereby acknowledged, the parties hereto
agree  as  follows:

                                    ARTICLE 1

                                   DEFINITIONS
     SECTION  1.1     Certain  Definitions.  As  used  in  this  Agreement,  the
                      --------------------
following  terms  have  the  meanings  specified  below:

                                     Page 1
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     "Amended  Articles"  means  the  Amended  Articles  of Incorporation of the
      -----------------
Company  as  amended  to  include the Statement of Resolutions setting forth the
rights,  preferences and privileges of the Class E Preferred Stock (as defined).

     "Board  of  Directors"  means  the  Board  of  Directors  of  the  Company.
      --------------------

     "Business  Day"  means any day other than Saturday, Sunday or any other day
      -------------
on which banking institutions in the City of New York, New York are permitted or
required  to  close.

     "Class  E  Preferred  Stock" means the Class E Convertible Senior Preferred
      --------------------------
Stock,  par  value  $0.001  per  share,  of the Company issued to the Investors.

     "Exchange  Act"  means the Securities Exchange Act of 1934, as amended, and
      -------------
the  rules  and  regulations  promulgated  thereunder.

     "GAAP"  means  United  States  generally accepted accounting principles set
      ----
forth  in  opinions and pronouncements of the Accounting Principles Board of the
American  Institute  of  Certified  Public  Accountants  and  statements  and
pronouncements  of  the  Financial  Accounting  Standards Board or in such other
statements  by  such other entity as may be approved by a significant segment of
the  accounting  profession,  in  each  case  as  the same are applicable to the
circumstances  as  of  the  date  of  the  determination.

    "Person" means an individual, partnership, corporation (including a business
     ------
trust),  limited  liability  company, joint stock company, trust, unincorporated
association,  joint  venture  or  other  entity.

     "Preferred  Stock"  means the Class C Convertible Senior Preferred Stock of
      ----------------
the  Company  (the  "Class  C  Preferred Stock"), the Class D Convertible Senior
                     -------------------------
Preferred  Stock  of  the  Company  (the "Class D Preferred Stock"), the Class E
                                          -----------------------
Preferred  Stock  and  the  Class  F  Convertible  Senior Preferred Stock of the
Company  (the  "Class F Preferred Stock"), each having a par value of $0.001 per
                -----------------------
share.

     "SEC"  means  the  Securities  and  Exchange  Commission  or  any successor
      ---
thereto.

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     "Securities  Act"  means  the  Securities  Act of 1933, as amended, and the
      ---------------
rules  and  regulations  promulgated  thereunder.

                                    ARTICLE 2

              ISSUANCE, FORM AND EXECUTION OF WARRANT CERTIFICATES

     SECTION  2.1     Issuance  of  Warrants.  The  Warrants shall be originally
                      ----------------------
issued  by  the  Company in connection with the consummation of the Merger.  The
Warrants  shall  be  evidenced  by Warrant Certificates (as defined herein), and
each  Warrant  Certificate  shall represent the right, subject to the provisions
contained  herein  and  therein,  to  purchase from the Company (and the Company
shall  issue  and  sell to the registered holder of such Warrants) the number of
shares  of  Common  Stock  (as  may  be  adjusted  pursuant to Article 7 hereof)
issuable  to  such  Warrantholder  upon  exercise of such Warrants, at the price
specified  herein  and  therein.

     SECTION  2.2     Form of Warrant Certificates.  The certificates evidencing
                      ----------------------------
the  Warrants  (the "Warrant Certificates") shall be in registered form only and
                     --------------------
shall be substantially in the form set forth in Exhibit A attached hereto, shall
                                                ---------
be  dated  the  date  on  which signed by the Company and may have such letters,
numbers  or  other marks of identification or designation printed, lithographed,
engraved or otherwise affixed thereon as the Company may deem appropriate and as
are  not  inconsistent  with  the provisions of this Agreement or the Securities
Purchase  Agreement,  or  as  may be required to comply with any law or with any
rule  or  regulation  made  pursuant  thereto.

     SECTION  2.3      Execution  of Warrant Certificates.  Warrant Certificates
                       ----------------------------------
shall  be executed on behalf of the Company by the president, any vice president
or  the  treasurer  of  the Company and signed by the secretary or any assistant
secretary of the Company and have affixed thereon the seal of the Company.  Each
such  signature  and  seal  may  be  manual  or  facsimile.

     In case any officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be such officer before countersignature and delivery
by  the  Company, such Warrant Certificates, nevertheless, may be countersigned,
issued  and  delivered  with the same force and effect as though such person had
not  ceased  to  be  such  officer; and any Warrant Certificate may be signed on
behalf  of the Company by any person who, at the actual date of the execution of
such  Warrant Certificate, shall be a proper officer of the Company to sign such
Warrant  Certificate,  although  at  the date of the execution of this Agreement
such  person  was  not such an officer of the Company.  Upon countersignature on
behalf  of  the Company and delivery, the Warrant Certificate shall be valid and
binding upon the Company, and the Warrantholder thereof shall be entitled to all
of  the  benefits  of  this  Agreement.

                                     Page 3
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                                    ARTICLE 3

                                  REGISTRATION

     SECTION  3.1     Registration.  The  Company  shall number and register the
                      ------------
Warrant  Certificates  in a register (the "Warrant Register") maintained at 1325
                                           ----------------
Northmeadow  Parkway,  Suite  110, Roswell, Georgia 30076 (the "Office") as they
                                                                ------
are  issued  by the Company (or such other location as the Company may establish
after  giving  notice  thereof  to  the Warrantholders).  The Company shall keep
copies  of  this Agreement available for inspection by the Warrantholders during
normal  business  hours  at  the  Office.

                                    ARTICLE 4

            TRANSFER, EXCHANGE OR REPLACEMENT OF WARRANT CERTIFICATES

     SECTION  4.1     Registration of Transfers.  The Company shall from time to
                      -------------------------
time register the transfer of any outstanding Warrant Certificate on the Warrant
Register  maintained  at  the  Office,  upon  surrender thereof accompanied by a
written instrument or instruments of transfer in form reasonably satisfactory to
the  Company,  duly  endorsed  by  the  registered  holder  thereof  or  by such
Warrantholder's  appointed  legal  representative  or  attorney-in-fact,  or
accompanied  by  proper  evidence  of  succession,  assignment  or  authority to
transfer.  In  all  cases  of  transfer  by  an  attorney, the original power of
attorney,  duly  approved, or an official copy thereof, duly certified, shall be
deposited  and  remain with the Company.  Upon any such registration or transfer
in  such  name  or names as may be directed in writing by the Warrantholder, the
Company  shall  execute  and  deliver  (or  cause to be delivered) a new Warrant
Certificate(s) without charge to such Warrantholder, or to the Person or Persons
entitled  to  receive the same, and the surrendered Warrant Certificate shall be
canceled  by  the  Company.

     SECTION  4.2  Exchanges  of Warrant Certificates.  Each Warrant Certificate
                   ----------------------------------
may  be  exchanged  at  the  option  of the Warrantholder without charge to such
Warrantholder when surrendered to the Company at the Office properly endorsed in
the manner described in Section 4.1 hereof for another Warrant Certificate(s) of
like  tenor  and representing in the aggregate a like number of shares of Common
Stock,  as may be adjusted pursuant to Article 7 hereof.  Thereupon, the Company

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shall  execute  and  deliver  to  the  Person(s)  entitled thereto a new Warrant
Certificate(s)  as  so requested.  Warrant Certificates surrendered for exchange
shall  be  canceled  by  the  Company.

     SECTION  4.3     Mutilated  or  Missing Warrant Certificates.  In the event
                      -------------------------------------------
that  any Warrant Certificate shall be mutilated, lost, stolen or destroyed, the
Company  shall  execute  and  deliver  in exchange and substitution for and upon
cancellation  of  the  mutilated  Warrant  Certificate,  or  in  lieu  of  and
substitution  for  the  Warrant  Certificate  lost,  stolen  or destroyed, a new
Warrant Certificate of like tenor and representing Warrants for a like amount of
Warrant  Shares,  but  only,  in  case  of  a  lost, stolen or destroyed Warrant
Certificate,  upon receipt of evidence satisfactory to the Company of such loss,
theft  or destruction and, upon the Company's request, evidence of indemnity and
bond satisfactory to the Company and the absence of actual notice to the Company
that  such  Warrant  Certificate  has  been acquired by a bona fide purchaser or
holder  in  due  course.  Every  substitute  Warrant  Certificate  executed  and
delivered  pursuant to this Section 4.3 in lieu of any lost, stolen or destroyed
warrant Certificate shall constitute an additional contractual obligation of the
Company,  whether or not the lost, stolen or destroyed Warrant Certificate shall
be  at  any time enforceable by anyone, and shall be entitled to the benefits of
(but  shall  be  subject  to  all  the  limitations of rights set forth in) this
Agreement  equally  and  proportionately  with  any  and  all  other  Warrant
Certificates  duly  executed  and  delivered  hereunder.  The provisions of this
Section  4.3  are  exclusive with respect to the replacement of mutilated, lost,
stolen  or  destroyed  Warrant  Certificates.

                                    ARTICLE 5

              EXERCISE OF WARRANTS; EXERCISE PRICE; EXERCISE PERIOD

     SECTION  5.1     Exercise  of  Warrants.  Subject to the provisions of this
                      ----------------------
Agreement,  each Warrantholder shall have the right to purchase from the Company
the  number  of shares of Common Stock that the Warrantholder may at the time be
entitled  to  purchase  on  exercise of the Warrants and payment of the Exercise
Price  (as  defined  below)  for  such  Warrant  Shares.

     SECTION  5.2     Mechanics  of  Exercise.
                      -----------------------

     (a)     Subject  to  the  provisions  of  this  Agreement,  Warrants may be
exercised  by the Warrantholder in whole or in part upon surrender at the Office
to  the  Company of the Warrant Certificate(s) evidencing the Warrants, together

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with  the form of election to purchase (the "Election to Purchase"), in the form
                                             --------------------
set  forth  as Exhibit B hereto or in the form set forth as Exhibit C hereto (in
               ---------                                    ------- -
the  case of a Warrant Exchange (as defined)), duly completed and signed by such
warrantholder  or  by  such  Warrantholder's  appointed  legal representative or
attorney-in--fact  and  upon  payment  in  full  of  the Exercise Price for each
Warrant  exercised  (except  in the case of a Warrant Exchange).  Payment of the
aggregate  Exercise  Price  shall  be  made  by certified or official bank check
payable  to  the  order  of  the  Company,  or  by  wire  transfer to an account
designated  by  the  Company.

     (b)     Upon  due  exercise  of  the  Warrants and surrender of the Warrant
Certificate,  duly  completed  and signed, and payment of' the Exercise Price as
aforesaid,  the Company shall cause to be issued to or upon the written order of
the  Warrantholder  and in such name or names as the Warrantholder may designate
in  the  Election  to  Purchase,  the  Warrant  Shares so purchased.  In lieu of
delivering  physical  certificates representing the Warrant Shares, provided the
Company's  transfer  agent  is participating in the Depositary Trust Issuer Fast
Automated  Securities  Transfer  ("FAST")  program,  upon  request  of  the
                                   ----
Warrantholder,  the  Company  shall  use  its best efforts to cause its transfer
agent  to  electronically  transmit the Warrant Shares issuable upon exercise of
the Warrants to the holder by crediting the account of the Warrantholder's prime
broker  with  Depositary  Trust  Company  through  its  Deposit Withdrawal Agent
Commission  system  (an "Electronic Transfer").  If all of the items referred to
                         -------------------
in  the first sentence of the preceding paragraph are received by the Company at
or  prior  to  1:00  p.m.,  Georgia time, on a Business Day, the exercise of the
Warrants  to which such items relate will be effective on such Business Day.  If
all of such items are received after 1:00 p.m., Georgia time, on a Business Day,
the exercise of the Warrants to which such items relate will be effective on the
next  Business  Day.

     (c)     The  number  and  kind  of Warrant Shares for which Warrants may be
exercised  shall  be  subject  to  adjustment  from time to time as set forth in
Article  7  hereof.

     (d)     The  Warrants  shall  be  exercisable  as  provided  herein  at the
election of the Warrantholder in whole or in part.  In the event that the holder
of  a Warrant Certificate shall exercise Warrants with respect to fewer than all
the  Warrant  Shares  evidenced thereby, a new Warrant Certificate(s) evidencing
the  remaining unexercised Warrant Shares shall be issued to such Warrantholder,
and  the  Company  is  hereby  irrevocably authorized to execute and deliver the
required  new  Warrant  Certificate(s)  pursuant  to provisions of Article 2 and
Article  3  of  this  Agreement.

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     (e)     All  Warrant  Certificates  surrendered  upon  exercise of Warrants
shall  be  canceled  and  disposed  of  by  the  Company.

     SECTION  5.3     Exercise  Price.  The  price at which each of the Warrants
                      ---------------
shall  be  exercisable in exchange for Warrant Shares shall be $8.46 per Warrant
Share  (as  such  price  may  be  adjusted  pursuant to Article 7 hereof) (being
referred  to  herein  as  the  "Exercise  Price").
                                ---------------

     SECTION  5.4     Exercise  Period. The right to exercise the Warrants shall
                      ----------------
terminate  on  December  31,  2004 (the "Expiration Date").  A Warrantholder may
                                         ---------------
exercise  any  Warrant  from  the  date  of  issuance  up  to  and including the
Expiration  Date.  The  Company shall record the Expiration Date of each Warrant
in  the  Warrant  Register.

     SECTION  5.5     Cashless  Exercise.
                      ------------------

     (a)     At  any  time  prior  to  the  Expiration Date of any Warrants, the
Warrantholder may, at its option, exchange such Warrants, in whole or in part (a
"Warrant  Exchange"),  into  the number of fully paid and non-assessable Warrant
 -----------------
Shares  determined  in  accordance  with  this  Section 5.5, by surrendering the
Warrant  Certificate  relating  to such Warrants at the Office, accompanied by a
notice stating such Warrantholder's intent to effect such cashless exchange, the
number of Warrant Shares to be issued upon such Warrant Exchange and the date on
which  the Warrantholder requests that such cashless Warrant Exchange occur (the
"Notice  of  Exchange").  The  cashless Warrant Exchange shall take place on the
---------------------
date  specified  in the Notice of Exchange, or, if later, the date the Notice of
Exchange is received by the Company (the "Exchange Date").  Certificates for the
-                                         -------------
Warrant  Shares issuable upon such cashless Warrant Exchange and, if applicable,
a  new  Warrant  Certificate of like tenor evidencing the balance of the Warrant
Shares  remaining  subject  to the Warrantholder's Warrant Certificate, shall be
issued  as  of the Exchange Date and delivered to the Warrantholder within three
Business  Days  following  the  Exchange  Date,  or  by Electronic Transfer.  In
connection  with  any  cashless  Warrant  Exchange,  the Warrantholder's Warrant
Certificate shall represent the right to subscribe for and acquire the number of
Warrant  Shares (rounded to the next highest integer) equal to (A) the number of
Warrant  Shares  specified  by  the Warrantholder in its Notice of Exchange (the
"Total  Share  Number")  less  (B)  the  number  of  Warrant Shares equal to the
----------------------
quotient  obtained by dividing (i) the product of the Total Share Number and the
existing Exercise Price per Warrant Share by (ii) the Market Price (as hereafter
defined)  of  a  share  of  Common  Stock.

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     (b)     As  used in this Section 5.5, the phrase "Market Price" at any date
                                                       ------------
shall be deemed to be the last reported sale price, or, in case no such reported
sale  takes  place on such day, the average of the last reported sale prices for
the  last  three  trading  days,  in  either  case as officially reported by the
principal securities exchange on which the Common Stock is listed or admitted to
trading  or  by  the  Nasdaq Stock Market National Market ("Nasdaq"), or, if the
                                                            ------
Common  Stock  is  not  listed or admitted to trading on any national securities
exchange  or quoted by Nasdaq, the average closing bid price as furnished by the
National  Association  of  Securities  Dealers,  Inc. ("NASD") through Nasdaq or
                                                        ----
similar  organization  if  Nasdaq is no longer reporting such information, or if
the  Common Stock is not quoted on Nasdaq, any exchange or similar organization,
as  determined  in  good  faith  by  resolution of the Board of Directors of the
Company,  based  on  the  best  information  available  to  it  for the two days
immediately  preceding  such  issuance  or  sale and the day of such issuance or
sale.

SECTION  5.6     Mandatory  Exercise.
                 -------------------

     (a)     In  the  event the Market Price of the Common Stock for twenty (20)
consecutive trading days is equal to at least $22.37 per share (as appropriately
adjusted  for  stock  splits,  stock dividends, combinations, recapitalizations,
reclassifications,  mergers,  consolidations  and  other  similar  events),  the
Company  shall  have the right to cause the exercise of the Warrants at any time
thereafter  by the Warrantholders by giving written notice to each Warrantholder
of  such  election  (a  "Mandatory Exercise Election Notice"); provided that the
                         ----------------------------------
Warrant  Shares  issuable  upon  such  exercise  shall  have been Registered (as
defined)  and  listed on each securities exchange, over-the-counter market or on
the Nasdaq National Market on which similar Securities issued by the Company are
then  listed.  "Registered"  refers  to a registration effected by preparing and
filing  with the SEC, a registration statement in compliance with the Securities
Act, as amended, and the declaration or ordering by the SEC of the effectiveness
of  such  registration  statement.

     (b)     Upon  receipt  of  a  Mandatory  Exercise  Election  Notice,  each
Warrantholder  shall  have  the  right to exercise its Warrants on the terms and
conditions  herein  (including  Section  5.5);  provided,  however,  that  the
                                                ------------------
Expiration  Date  with  respect  to such Warrants shall be deemed to be the date
that  is  fifteen (15) Business Days immediately after the date of the Mandatory
Exercise  Election  Notice.

                                     Page 8
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                                    ARTICLE 6

                          RESERVATION OF WARRANT SHARES

     SECTION 6.1     Reservation.  The Company shall at all times keep reserved,
                     -----------
free  from  preemptive  rights,  out  of  its  authorized Common Stock, or other
securities  of  the Company issuable upon the exercise of the Warrants, a number
of  shares  of Common Stock, or such other securities, sufficient to provide for
the  exercise  of'  the  right  of  purchase  represented by all outstanding and
unexpired  Warrants.

     SECTION  6.2     Covenant.  The  Company  covenants that any Warrant Shares
                      --------
will,  upon  issuance,  be  (i)  validly issued and upon payment of the exercise
price  therefor,  fully  paid  and  free  from all taxes payable by the Company,
liens,  charges  and  security  interests (except any liens, charges or security
interests  created  or suffered to be created by any of the Warrantholders), and
will  not  be subject to any restrictions on voting or transfer thereof that are
created  by  the  Company,  except  for  such restrictions on transfer under the
Securities  Act  or  applicable  state  securities laws; and (ii) Registered and
listed  on  each  securities  exchange, over-the-counter market or on the Nasdaq
National  Market  on  which  similar  securities  issued by the Company are then
listed.

                                    ARTICLE 7

                 ADJUSTMENTS AFFECTING THE EXERCISE OF WARRANTS

     SECTION  7.1     Special  Definitions.  For purposes of this Article 7, the
                      --------------------
following  definitions  shall  apply:

     (a)     "Additional Shares of Common Stock" shall mean all shares of Common
              ---------------------------------
Stock  issued  (or,  pursuant  to Section 7.2 below, deemed to be issued) by the
Company  after the Original Issue Date, other than shares of Common Stock issued
or  issuable:

          (i)     upon  conversion of shares of any class of the Preferred Stock
of  the  Company  outstanding  on  the  Original  Issue  Date;

          (ii)     upon  the  exercise  of  warrants outstanding on the Original
Issue  Date;

          (iii)     as  a  dividend  or  distribution on the Company's Preferred
Stock  or  such  warrants;

          (iv)     as  a  part  of,  or  in  connection  with,  the  Merger;

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          (v)     in  connection with an acquisition or other transaction by the
Company,  in either case approved by the Investors, unless the Company agrees to
include  such issuance in the definition of Additional Shares of Common Stock in
connection  with  obtaining the approval of the Investors to such acquisition or
other  transaction;

          (vi)     by  reason  of  a  dividend,  stock split, split--up or other
distribution  on  shares  of  Common  Stock  excluded  from  the  definition  of
Additional  Shares  of  Common  Stock by the foregoing clauses (i), (ii), (iii),
(iv)  and  (v)  or  this  clause  (vi);

          (vii)     upon the exercise of options excluded from the definition of
"Option"  in  Section  7.1(c).

     (b)     "Convertible  Securities" shall mean any evidences of indebtedness,
              -----------------------
shares  or  other  securities other than options excluded from the definition of
"Option"  in  Section  7.1(c)  directly  or  indirectly  convertible  into  or
exchangeable  for  Common  Stock.

     (c)     "Option"  shall  mean rights, options or warrants to subscribe for,
              ------
purchase  or otherwise acquire Common Stock or Convertible Securities, excluding
(i)  options  granted to employees, officers, directors or issued to consultants
of  the  Company  or  rights,  warrants or convertible securities which, in each
case,  are  outstanding  as  of  the  date  of this Agreement, (ii) any warrants
outstanding  on  the  Original Issue Date or issued under this Agreement or as a
direct  result  of  the  issuance  of the Class E Preferred Stock, (iii) options
granted  to  employees,  officers,  directors  or  consultants pursuant to stock
option  plans existing on the Original Issue Date (as defined) or adopted by the
Board  of  Directors  and approved by the Compensation Committee of the Board of
Directors  and  by  the  Investors  after  the  date hereof, or (iv) any rights,
options or warrants to subscribe for, purchase or otherwise acquire Common Stock
or  other Convertible Securities issued as a part of, or in connection with, the
Merger.

     (d)     "Original  Issue  Date"  shall mean the date on which a Warrant was
first  issued.

     SECTION  7.2     Issue  of  Securities Deemed Issue of Additional Shares of
                      ------------------------------------- --------------------
Common  Stock.  If  the  Company  at  any  time  or  from time to time after the
-------------
Original  Issue Date shall issue any Options or Convertible Securities, then the
maximum  number  of  shares  of  Common  Stock  (as  set forth in the instrument
relating  thereto  without  regard  to  any  provision  contained  therein for a
subsequent adjustment of such number) issuable upon the exercise of such Options
or,  in  the case of Convertible Securities and Options therefor, the conversion
or  exchange  of  such  Convertible  Securities and the exercise of such Options

                                    Page 10
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therefor,  shall  be deemed to be Additional Shares of Common Stock issued as of
the time of such issuance, provided that Additional Shares of Common Stock shall
not be deemed to have been issued unless the consideration per share (determined
pursuant  to Section 7.4 hereof) of such Additional Shares of Common Stock would
be  less  than the applicable Exercise Price in effect immediately prior to such
issuance  and  provided further that in any such case in which Additional Shares
of  Common  Stock  are  deemed  to  be  issued:

     (a)     No  further adjustment in the Exercise Price shall be made upon the
subsequent issuance of Convertible Securities or shares of Common Stock upon the
exercise  of  such  Options  or  conversion  or  exchange  of  such  Convertible
Securities;

     (b)     If  such  Options or Convertible Securities by their terms provide,
with  the  passage  of  time or otherwise, for any increase in the consideration
payable  to  the  Company,  or  decrease in the number of shares of Common Stock
issuable,  upon the exercise, conversion or exchange thereof, the Exercise Price
computed  upon  the  original  issuance  thereof, and any subsequent adjustments
based  thereon, shall, upon any such increase or decrease becoming effective, be
recomputed  to  reflect  such  increase  or  decrease insofar as it affects such
Options  or  the  rights  of  conversion  or  exchange  under  such  Convertible
Securities;

     (c)     No  readjustment pursuant to clause (b) above shall have the effect
of  increasing  the Exercise Price to an amount which exceeds the Exercise Price
on  the  original  adjustment  date;  and

     (d)     In  the event of any change in the number of shares of Common Stock
issuable  upon the exercise, conversion or exchange of any Option or Convertible
Security,  including,  but  not  limited  to,  a  change  resulting  from  the
anti-dilution  provisions  thereof,  the  Exercise  Price  then  in effect shall
forthwith  be  readjusted  to such Exercise Price as would have obtained had the
adjustment  which  was  made  upon  the  issuance  of such Option or Convertible
Security  which have not been exercised or converted prior to such change in the
number of shares of Common Stock been made upon the basis of such change, but no
further  adjustment  shall  be made for the actual issuance of Common Stock upon
the  exercise  or  conversion  of  any  such  option  or  Convertible  Security.

     SECTION  7.3     Adjustment  of  Exercise Price Upon Issuance of Additional
                      ----------------------------------------------------------
Shares  of  Common  Stock.  In the event the Company shall at any time after the
-------------------------

                                    Page 11
<PAGE>
Original  Issue  Date  issue  Additional  Shares  of  Common  Stock  (including
Additional  Shares  of Common Stock deemed to be issued pursuant to Section 7.2,
but excluding shares issued as a dividend or distribution as provided in Section
7.6  or  upon  a stock split or combination as provided in Section 7.5), without
consideration  or  for a consideration per share (determined pursuant to Section
7.4  hereof) less than the applicable Exercise Price in effect immediately prior
to  such issuance, then and in such event, such Exercise Price shall be reduced,
concurrently  with  such  issuance,  to  an  Exercise  Price  equal to the price
determined by dividing (a) the sum of (1) the product derived by multiplying the
Exercise  Price  in  effect  immediately prior to such issuance by the number of
shares  of Common Stock outstanding immediately prior to such issuance (together
with  the  number  of  shares of Common Stock then issuable upon exercise of the
outstanding  Warrants  and  the  conversion  or  exercise  of  any  Convertible
Securities  or  Options),  plus  (2) the aggregate consideration received by the
Corporation (as determined pursuant to Section 7.4 below) upon such issuance, by
(b)  the  number  of  shares  of Common Stock outstanding immediately after such
issuance  (together with the number of shares of Common Stock then issuable upon
exercise  of  the  outstanding  Warrants  and  the conversion or exercise of any
Convertible  Securities  or  Options).

     SECTION  7.4     Determination  of  Consideration.  For  purposes  of  this
                      --------------------------------
Section  7,  the  consideration  received by the Company for the issuance of any
Additional  Shares  of  Common  Stock  shall  be  computed  as  follows:

     (a)     Cash  and  Property.  Such  consideration  shall:
             -------------------

          (i)     insofar  as  it consists of cash, be computed at the aggregate
of  cash  received by the Company, excluding amounts paid or payable for accrued
interest  or  accrued  dividends;

          (ii)     insofar  as  it  consists  of  property  other  than cash, be
computed  at  the  fair  market  value  thereof at the time of such issuance, as
determined  in  good  faith  by  the  Board  of  Directors;  and

          (iii)     in  the  event  Additional Shares of Common Stock are issued
together  with  other  shares  of  securities or other assets of the Company for
consideration  which  covers  both,  be  the proportion of such consideration so
received,  computed  as provided in clauses (i) and (ii) above, as determined in
good  faith  by  the  Board  of  Directors.

     (b)     Options  and  Convertible  Securities.  The consideration per share
             -------------------------------------
received  by  the  Company  for Additional Shares of Common Stock deemed to have

                                    Page 12
<PAGE>
been  issued  pursuant  to  Section  7.2,  relating  to  Options and Convertible
Securities,  shall  be  determined  by  dividing:

          (i)     the  total  amount,  if  any,  received  or  receivable by the
Company  as  consideration  for  the  issuance  of  such  Options or Convertible
Securities,  plus  the  minimum aggregate amount of additional consideration (as
set  forth  in the instruments relating thereto, without regard to any provision
contained  therein for a subsequent adjustment of such consideration) payable to
the  Company  upon the exercise of such Options or the conversion or exchange of
such  Convertible  Securities,  or  in  the  case  of  Options  for  Convertible
Securities,  the  exercise  of  such  options for Convertible Securities and the
conversion  or exchange of such Convertible Securities, by the maximum number of
shares  of  Common  Stock  (as  set  forth  in the instruments relating thereto,
without regard to any provision contained therein for a subsequent adjustment of
such  number)  issuable  upon  the exercise of such options or the conversion or
exchange  of  such  Convertible  Securities.

     SECTION  7.5     Adjustment  for  Stock  Splits  and  Combinations.  If the
                      -------------------------------------------------
Company shall at any time or from time to time after the Original Issue Date for
the  Warrants effect a subdivision of the outstanding Common Stock, the Exercise
Price  of  each Warrant then in effect immediately before that subdivision shall
be  proportionately  decreased and the number of shares of Common Stock issuable
upon  exercise  of  such  Warrant  shall  be  proportionately increased.  If the
Company shall at any time or from time to time after the Original Issue Date for
the  Warrants combine the outstanding shares of Common Stock, the Exercise Price
of  each  Warrant  then  in  effect  immediately before the combination shall be
proportionately increased and the number of shares of Common Stock issuable upon
exercise  of  such  Warrant  shall be proportionately decreased.  Any adjustment
under  this  Section  7.5 shall become effective at the close of business on the
date  the  subdivision  or  combination  becomes  effective.

     SECTION 7.6     Adjustment for Certain Dividends and Distributions.  In the
                     ------------------------------------ -------------
event the Company at any time or from time to time after the Original Issue Date
for the Warrants shall make or issue a dividend or other distribution payable in
additional  shares  of  Common  Stock,  then and in each such event the Exercise
Price  for the Warrants then in effect shall be decreased as of the time of such
issuance  or,  in  the event such a record date shall have been fixed, as of the
close of business on such record date, by multiplying the Exercise Price for the
Warrants  then  in  effect  by  a  fraction:

                                    Page 13
<PAGE>
     (a)     the  numerator  of  which  shall  be  the total number of shares of
Common  Stock  issued  and  outstanding  immediately  prior  to the time of such
issuance  or  the  close  of  business  on  such  record  date,  and

     (b)     the  denominator  of  which  shall be the total number of shares of
Common  Stock  issued  and  outstanding  immediately  prior  to the time of such
issuance  or the close of business on such record date plus the number of shares
of  Common Stock issuable in payment of such dividend or distribution; provided,
                                                                       --------
however,  if  such  record  date  shall have been fixed and such dividend is not
-------
fully paid or if such distribution is not fully made on the date fixed therefor,
the  Exercise  Price  for the Warrants shall be recomputed accordingly as of the
close  of business on such record date and thereafter the Exercise Price for the
Warrants  shall  be adjusted pursuant to this paragraph as of the time of actual
payment  of  such  dividends  or  distributions.

     The  number  of  Warrant  Shares issuable upon the exercise of the Warrants
shall  be adjusted by multiplying a number equal to the Exercise Price in effect
immediately  prior  to such adjustment by the number of shares issuable upon the
exercise  of  the Warrants immediately prior to such adjustment and dividing the
product  so  obtained  by  the  adjusted  Exercise  Price.

     SECTION  7.7     Adjustments for Other Dividends and Distributions.  In the
                      -------------------------------------------------
event the Company at any time or from time to time after the Original Issue Date
for the Warrants shall make or issue a dividend or other distribution payable in
securities  of  the  Company other than shares of Common Stock, then and in each
such  event  provision  shall  be made so that the holders of the Warrants shall
receive  upon  exercise  thereof  in  addition to the number of shares of Common
Stock  receivable  thereupon,  the amount of securities of the Company that they
would  have received had their Warrants been exercised on the date of such event
and  had  thereafter,  during  the  period  from  the  date of such event to and
including  the  conversion  date, retained such securities receivable by them as
aforesaid  during  such  period giving application to all adjustments called for
during  such  period,  under  this  paragraph  with respect to the rights of the
holders  of  the  Warrants.

     SECTION 7.8     Adjustment for Reclassification, Exchange, or Substitution.
                     --------------------------------------------- ------------
If  the Common Stock issuable upon the exercise of the Warrants shall be changed
into  the same or a different number of shares of any class or classes of stock,
whether  by  capital reorganization, reclassification or otherwise (other than a
subdivision  or combination of shares or stock dividend provided for above, or a
reorganization,  merger,  consolidation,  or sale of assets provided for below),
then  and  in  each  such  event the holder of the Warrants shall have the right

                                    Page 14
<PAGE>
thereafter to convert each such share of Common Stock issuable upon the exercise
of the Warrants into the kind and amount of shares of stock and other securities
and  property  receivable  upon  such reorganization, reclassification, or other
change,  by  holders  of  the  number  of  shares of Common Stock for which such
Warrants  might  have  been  exercised immediately prior to such reorganization,
reclassification,  or  change,  all  subject  to  further adjustment as provided
herein.

     SECTION  7.9     Adjustment  for  Merger or Reorganization.  In case of any
                      -----------------------------------------
consolidation  or  merger  of  the  Company  with  or into another Company, each
Warrant  shall  thereafter  be  exercisable for the kind and amount of shares of
stock  or other securities or property to which a holder of the number of shares
of  Common  Stock of the Company deliverable upon exercise of such Warrant world
have  been  entitled  upon  such  consolidation  or  merger;  and, in such case,
appropriate  adjustment  (as determined in good faith by the Board of Directors)
shall  be  made in the application of the provisions in this Article 7 set forth
with  respect  to  the  rights  and  interest  thereafter  of the holders of the
Warrants,  to the end that the provisions set forth in this Article 7 (including
provisions  with  respect  to  changes  in and other adjustments of the Exercise
Price)  shall  thereafter  be  applicable,  as  nearly  as reasonably may be, in
relation  to  any  shares of stock or other property thereafter deliverable upon
the  exercise  of  the  Warrants.

     SECTION  7.10  Notice  of  Adjustment to Exercise Price and Warrant Shares.
                    -----------------------------------------------------------

          (a)     Whenever  the  Exercise  Price  is  required to be adjusted as
provided  in  this Article 7, simultaneously with the adjustment of the Exercise
Price,  the  number of Warrant Shares issuable upon the exercise of the Warrants
shall  be adjusted by multiplying a number equal to the Exercise Price in effect
immediately  prior  to such adjustment by the number of shares issuable upon the
exercise  of  the Warrants immediately prior to such adjustment and dividing the
product  so  obtained  by  the  adjusted  Exercise  Price.

          (b)     Whenever  the  Exercise  Price  is  required to be adjusted as
provided in this Article 7, or any other adjustment is required pursuant to this
Article  7,  the Company shall forthwith compute the adjusted Exercise Price and
the corresponding number of Warrant Shares purchaseable upon the exercise of the
Warrants  or  any  other  adjustment  made  pursuant to this Article 7 and shall
prepare  a  certificate  setting  forth  such  adjusted  Exercise  Price and the
corresponding  number  of  Warrant  Shares purchaseable upon the exercise of the
Warrants  or any other adjustment made pursuant to this Article 7 and showing in

                                    Page 15
<PAGE>
reasonable detail the facts upon which such adjustments are based.  Whenever the
Exercise  Price and the corresponding number of Warrant Shares purchaseable upon
the  exercise  of  the  Warrants  are  adjusted  or any other adjustment is made
pursuant  to  this  Article  7,  the Company shall promptly mail, or cause to be
mailed,  to the Warrantholders a statement setting forth the adjustments and the
reasons  for  such  adjustments.

     SECTION  7.11     Form  of  Warrant  Certificate.  Irrespective  of  any
                       ------------------------------
adjustments in the Exercise Price or the kind of Warrant Shares purchasable upon
the  exercise  of  the  Warrants,  Warrant Certificates evidencing such Warrants
theretofore  or  thereafter  issued  may continue to express the same number and
kind  of  Warrant  Shares  as  are  stated in the Warrant Certificates initially
issuable  pursuant  to  this  Agreement.

     SECTION  7.12     No  Impairment.  Without  limiting  the generality of the
                       --------------
foregoing,  the  Company  shall  take  all  such  action  as may be necessary or
appropriate  in  order that the Warrant Shares to be issued upon the exercise of
the  Warrants from time to time outstanding will, when issued, be fully paid and
non-assessable.  In  addition,  without  limiting the generality of Section 6.1,
the  Company shall take all such action as shall be necessary so that, after any
adjustment  to the Exercise Price required hereunder, the total number of shares
of  Common  Stock  or  other capital stock of the Company then authorized by the
Amended  Articles  and  available for the purpose of issuance upon such exercise
shall  exceed  the  total  number  of  shares  of Common Stock issuable upon the
exercise of all of the outstanding Warrants.  The Company will not, by amendment
of  its  Articles  of  Incorporation  or through any reorganization, transfer of
assets,  consolidation,  merger, dissolution, issue or sale of securities or any
other  voluntary action, avoid or seek to avoid the observance or performance of
any  of the terms to be observed or performed hereunder by the Company, but will
at  all  times in good faith assist in the carrying out of all the provisions of
this  Article  7  and  in  the  taking of all such action as may be necessary or
appropriate  in  order  to  protect  the  rights  of  the Warrantholders against
impairment.

                                    ARTICLE 8

                                     NOTICES

     SECTION  8.1  Notices  to  Warrantholders.
                   ---------------------------

                                    Page 16
<PAGE>
          (a)     Notices  to  holders  of  Warrants  shall be delivered to such
holders at the addresses of such holders as they appear in Section 8.2 hereof or
in  the  Warrant  Register (in the case of transfers).  Any such notice shall be
sufficiently  given if sent by first-class certified or registered mail, postage
prepaid,  facsimile  or  overnight  courier.

          (b)     In  the  event  (i)  of any consolidation or merger or binding
exchange  of interests to which the Company is a party and for which approval of
the  Investors or any holders of equity interests of the Company is required, or
of  the  conveyance  or  sale  of  all or substantially all of the assets of the
Company,  or of any change of the Common Stock or other securities issuable upon
exercise  of  the  Warrants;  or (ii) the Company shall make any distribution in
respect  of  the  Common  Stock;  or  (iii)  of  the  voluntary  or  involuntary
dissolution,  liquidation  or  winding up of the Company; then the Company shall
send  to  each  Warrantholder  at least thirty days prior to the applicable date
hereinafter  specified,  a  written  notice  stating  (A)  the  date  for  the
determination  of the holders of Common Stock (or other Securities issuable upon
the exercise of the Warrants) entitled to receive any such distribution, (B) the
initial expiration date Set forth in any offer for exchange of interests, or (C)
the  date  on  which  any  such  consolidation,  merger,  exchange of interests,
conveyance,  transfer,  reclassification, dissolution, liquidation or winding up
is  expected  to become effective or consummated, and the date as of which it is
expected  that  holders  of record of Common Stock (or other securities issuable
upon  the  exercise  of  the Warrants) shall be entitled to exchange such Common
Stock  for  securities  or  other  property,  if  any,  deliverable  upon  such
reclassification,  consolidation,  merger,  exchange  of  interests, conveyance,
transfer,  dissolution,  liquidation  or  winding  up.

     SECTION  8.2  Notices  to Company.  Any notice or demand authorized by this
                   -------------------
Agreement  to  be  given to or on the parties shall be delivered in person or by
facsimile  transmission, by courier guaranteeing overnight delivery or mailed by
first-class  United  States  certified  or  registered mail, postage prepaid, as
follows:

a)  if  to  the  Company:

          Telscape  International,  Inc.
          1325  Northmeadow  Parkway
          Suite  110
          Roswell,  Georgia  30076
          Attention:  Stephen  E.  Raville
          Facsimile:  (770)  319-2834

                                    Page 17
<PAGE>
with  a  copy  to:

          Gardere  &  Wynne,  LLP
          3000  Thanksgiving  Tower
          1601  Elm  Street
          Dallas,  Texas  75201-4761
          Attention:  W.  Robert  Dyer  Jr.
          Facsimile:  (214)  999-3574

(b)  if  to  TSG:

          TSG  Capital  Fund  III,  L.P.
          177  Broad  Street,  12th  Floor
          Stamford,  CT  06901
          Attention:  Darryl  B.  Thompson
          Facsimile:  (203)  406-1590

with  a  copy  to  (which  shall  not  constitute  notice):

          Mayer,  Brown  &  Platt
          1675  Broadway
          New  York,  NY  10019
          Attention:  Kathleen  A.  Walsh
          Facsimile:  (212)  262-1910

(c)  if  to  OCP  II:

          Opportunity  Capital  Partners  II,  L.P.
          2201  Walnut  Avenue,  Suite  210
          Fremont,  California  94538
          Attention:  Lewis  E.  Byrd
          Facsimile:  (510)  494-5439

with  a  copy  to  (which  shall  not  constitute  notice):

          Folger  Levin  &  Kahn,  L.L.P.
          Embarcadero  Center  West
          275  Battery  Street,  23rd  Floor
          San  Francisco,  California  94111
          Attention:  Christopher  Conner,  Esq.
          Facsimile:  (415)  986-2827

                                    Page 18
<PAGE>
(d)  if  to  OCP  III:

          Opportunity  Capital  Partners  III,  L.P.
          2201  Walnut  Avenue,  Suite  210
          Fremont,  California  94538
          Attention:  Lewis  E.  Byrd
          Facsimile:  (510)  494-5439

with  a  copy  to  (which  shall  not  constitute  notice):

          Folger  Levin  &  Kahn,  L.L.P.
          Embarcadero  Center  West
          275  Battery  Street,  23rd  Floor
          San  Francisco,  California  94111
          Attention:  Christopher  Conner,  Esq.
          Facsimile:  (415)  986-2827

     SECTION  8.3  Receipt  of Notice.  Any notice hereunder shall be in writing
                   ------------------
and  shall  be deemed effectively given and received upon delivery in person, or
two  business  days  after  delivery by national overnight courier service or by
telecopier  transmission  with  acknowledgment  of transmission receipt, or five
business  days  after  deposit  via certified or registered mail, return receipt
requested.

                                    ARTICLE 9

                                  MISCELLANEOUS

     SECTION  9.1     WAIVER  OF  JURY  TRIAL.  THE COMPANY AND EACH INVESTOR DO
                      -----------------------
HEREBY  KNOWINGLY,  VOLUNTARILY,  INTENTIONALLY AND IRREVOCABLY WAIVE SUCH RIGHT
ANY  PARTY  MAY  HAVE  TO  A  JURY  TRIAL  IN  EVERY JURISDICTION IN ANY ACTION,
PROCEEDING  OR  COUNTERCLAIM  BROUGHT  BY  ANY  OF  THE  PARTIES HERETO OR THEIR
RESPECTIVE  AFFILIATES,  SUCCESSORS OR ASSIGNS AGAINST ANY OTHER PARTY HERETO OR
THEIR  RESPECTIVE  AFFILIATES,  SUCCESSORS  OR  ASSIGNS IN RESPECT OF ANY MATTER
ARISING  OUT  OF  OR  IN  CONNECTION  WITH  THIS AGREEMENT OR ANY OTHER DOCUMENT
EXECUTED  AND DELIVERED BY ANY PARTY IN CONNECTION THEREWITH (INCLUDING, WITHOUT
LIMITATION,  ANY  ACTION  TO RESCIND OR CANCEL THIS AGREEMENT, AND ANY CLAIMS OR
DEFENSES  ASSERTING  THAT  THIS  AGREEMENT WAS FRAUDULENTLY INDUCED OR OTHERWISE
VOID  OR  VOIDABLE).

                                    Page 19
<PAGE>
     SECTION  9.2      Payment  of Taxes.  The Company covenants and agrees that
                       -----------------
it  will  pay  when  due  and  payable  all  documentary,  stamp and other taxes
attributable  to  the issuance or delivery of the Warrant Certificates or of the
Warrant Shares purchasable upon the exercise of Warrants; provided, however, the
                                                          --------
Company  shall  not  be  required to pay any tax or taxes that may be payable in
respect of any transfer involving the issue of any Warrant Certificate(s) or any
certificates)  for Warrant Shares in a name other than that of the Warrantholder
of  such  exercised  Warrant  Certificate  (s)

SECTION  9.3     Amendment.
                 ---------

     (a)  The  Company  may  modify this Agreement and the terms of the Warrants
only  with the consent of the Warrantholders representing at least sixty-six and
two-thirds percent (66 2/3%) of the Warrant Shares for the purpose of adding any
provision  to  or changing in any manner or eliminating any of the provisions of
this  Agreement  or  modifying  in  any  manner the rights of the holders of the
outstanding  Warrants;  provided,  however,  that  no such modification that (i)
                        --------   -------
materially  and  adversely  affects  the  exercise  rights of the holders of the
Warrants  or  (ii) reduces the percentage required for modification, may be made
without  the  consent  of  the  holder  of  all  outstanding  warrants.

     (b)     Any  such  modification or amendment will be conclusive and binding
on  all  present  and future holders of Warrant Certificates whether or not they
have  consented  to  such modification or amendment or waiver and whether or not
notation  of  such  modification  or  amendment  is  made  upon  such  Warrant
Certificates.  Any  instrument  given by or on behalf of any holder of a Warrant
Certificate in connection with any consent to any modification or amendment will
be conclusive and binding on all Subsequent holders of such Warrant Certificate.

     SECTION  9.4  Termination.  This  Agreement  shall terminate on or upon (a)
                   -----------
the  repurchase  by the Company of all Warrants, (b) the fifteenth day following
the  date  on which all of the Warrant Shares have been issued upon the exercise
of  all  Warrants  issued  pursuant  hereto,  or  (c)  the  Expiration  Date.

                                    Page 20
<PAGE>
     SECTION  9.5  Reports  to  Warrantholders.  The  Company  will  cause to be
                   ---------------------------
delivered, by first-class mail, postage prepaid, facsimile or overnight courier,
to  each  Warrantholder at such Warrantholder's address appearing on the Warrant
Register,  a  copy of any reports delivered by the Company to any of the holders
of  Class  B  Preferred  Stock  or  to  holders  of  the  Common  Stock.

     SECTION 9.6  GOVERNING LAW.  THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN
                  -------------
THIS  AGREEMENT  AND  THE  WARRANT  CERTIFICATES WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS  OF  LAW.

     SECTION  9.7  Benefits  of this Agreement.  Nothing in this Agreement shall
                   ----------------------------
be  construed  to  give to any Person other than the Company, the Warrantholders
and  the holders of Warrant Shares any legal or equitable right, remedy or claim
under this Agreement; this Agreement shall be for the sole and exclusive benefit
of  the  Company,  the  Warrantholders  and  the  holders  of  Warrant  Shares.

     SECTION 9.8  Counterparts.  This Agreement may be executed in any number of
                  ------------
counterparts,  and each of such counterparts shall for all purposes be deemed to
be  an original, and all such counterparts shall together constitute but one and
the  same  instrument.  Facsimile  transmission  of any signed original document
and/or  retransmission  of  any signed facsimile transmission will be deemed the
same as delivery of any original.  At the request of any party, the parties will
confirm  facsimile  transmission  by  signing  a  duplicate  original  document.

     SECTION  9.9  Severability  of Provisions.  Any provision of this Agreement
                   ---------------------------
that  is  prohibited  or  unenforceable  in  any  jurisdiction shall, as to such
jurisdiction,  be  ineffective  to  the  extent  of  such  prohibition  or
unenforceability  without  invalidating  the  remaining  provisions  hereof  or
affecting  the  validity  or  enforceability  of  such  provision  in  any other
jurisdiction.

     SECTION 9.10  Headings.  The headings of the sections of this Agreement are
                   --------
inserted for convenience only and shall not constitute a part of this Agreement.

                                    Page 21
<PAGE>
     SECTION  9.11  Access  to  Company  Records.  So  long  as  Warrants remain
                    ----------------------------
outstanding,  each  Investor  shall  be  entitled  to  review  the financial and
corporate  books  and  records  of  the  Company  and to meet with the executive
officers  and  independent  accountants  of  the Company for purposes reasonably
related  to  the  Investor's  ownership  of  the  Warrants,  which review and/or
meetings  shall  take place at reasonable times during the normal business hours
of  the Company and in such a manner as to not unduly interfere with the conduct
of  the  Company's  business.

                                    Page 22
<PAGE>
IN  WITNESS WHEREOF, the parties hereto have caused this Warrant Agreement to be
duly  executed,  as  of  the  date  first  above  written.

                                    TELSCAPE  INTERNATIONAL,  INC.,
                                    a  Texas  corporation

                                    By:______________________________________
                                         Richard  P.  Halevy
                                         Chief  Financial  Officer

                                    TSG  CAPITAL  FUND  III,  L.P.,
                                    a  Delaware  limited  partnership

                                    By:  TSG  Associates  III,  L.L.C.,
                                         Its  General  Partner

                                         By:___________________________
                                         Name:_________________________
                                         Title:________________________

                                    OPPORTUNITY  CAPITAL  PARTNERS  II,  L.P.
                                    a  Delaware  limited  partnership

                                    By:  Thompson  Capital  Management,  L.P.
                                         Its  General  Partner

                                         By:___________________________
                                            Lewis  E.  Byrd
                                            Partner

                                    Page 23
<PAGE>
                                    OPPORTUNITY  CAPITAL  PARTNERS  III,  L.P.
                                    a  Delaware  limited  partnership

                                    By:  JM  Capital  Management,  L.P.
                                         Its  General  Partner

                                         By:___________________________
                                            Lewis  E.  Byrd
                                            General  Partner

                                    Page 24
<PAGE>
                                    EXHIBIT A
                                    ---------

                          TELSCAPE INTERNATIONAL, INC.

                          Common Stock Purchase Warrant
                                  Number _____

                Warrant Certificate Evidencing Right to Purchase

                         I      ] Shares of Common Stock

     This  is  to certify that [Investor], [a _________________], or assigns, is
entitled to purchase at any time or from time to time up to the above-referenced
number  of  shares  of Common Stock ("Common Stock"), of Telscape International,
                                      ------------
Inc.,  a  Texas  corporation  (the  "Company"),  for  the Exercise Price for the
                                     -------
Warrants  specified  in  the Warrant Agreement, dated as of June 2, 2000, by and
among the Company,  TSG Capital Fund III, L.P., Opportunity Capital Partners II,
L.P.,  and  Opportunity  Capital  Partners  III, L.P. (the "Warrant Agreement"),
                                                            -----------------
pursuant  to which this Warrant Certificate is issued.  All rights of the holder
of  this  Warrant  Certificate  are  subject  to the terms and provisions of the
Warrant  Agreement,  copies  of which are available for inspection the Company's
office  located  at  1325 Northmeadow Parkway, Suite 110, Roswell, Georgia 30076
(the  "Office").  The  Expiration  Date (as defined in the Warrant Agreement) of
       ------
the  right to purchase Common Stock pursuant to this Certificate is December 31,
2004.

     NEITHER  THE  WARRANTS  REPRESENTED  BY  THIS CERTIFICATE NOR THE SHARES OF
COMMON  STOCK  THAT  MAY  BE PURCHASED UPON EXERCISE HEREOF HAVE BEEN REGISTERED
UNDER  THE  SECURITIES  ACT  OF  1933,  AS  AMENDED  (THE  "ACT"),  OR UNDER ANY
                                                            ---
APPLICABLE  STATE  LAW.  SUCH  WARRANTS  AND SHARES MAY NOT BE OFFERED FOR SALE,
SOLD,  TRANSFERRED  OR  PLEDGED  WITHOUT  (1) REGISTRATION UNDER THE ACT AND ANY
APPLICABLE  STATE  LAW,  OR  (2)  THE  AVAILABILITY  OF  AN  EXEMPTION FROM SUCH
REGISTRATION.

     Subject  to  the  provisions  of  the  Act,  applicable state laws and such
Warrant  Agreement,  this  Warrant  Certificate  and  all  rights  hereunder are
transferable,  in whole or in part, at the Office by the holder hereof in person
or  by  a  duly authorized attorney, upon surrender of this Warrant Certificate,
together  with  the  assignment  hereof  duly  endorsed.  Until transfer of this
Warrant  Certificate  on  the  books  of  the Company, the Company may treat the
registered  holder  hereof  as  the  owner  hereof  for  all  purposes.

<PAGE>
     IN  WITNESS  WHEREOF, the Company has caused this Warrant Certificate to be
executed  on  this  2nd  day  of  June,  2000, in Roswell, Georgia by its proper
corporate  officers  thereunto  duly  authorized.

                                         TELSCAPE  INTERNATIONAL,  INC.
                                         a  Texas  corporation

                                         By:___________________________
                                         Name:_________________________
                                         Title:________________________

Attest:____________________________
Name:______________________________
Title:_____________________________

<PAGE>
                                    EXHIBIT B
                                    ---------

                              Election to Purchase
                   (To be executed by the registered holder if
            such holder desires to exercise any Warrant Certificate)

     The undersigned, the registered holder of the attached Warrant Certificate,
hereby  irrevocably  elects  to  exercise  Warrants  represented by such Warrant
Certificate  and  acquire  an
aggregate  of  _____  shares  of Common Stock of Telscape International, Inc., a
Texas  corporation,  and  herewith  tenders payment for such Common Stock in the
amount  of  $_______  (by  certified check or official bank check) in accordance
with  the terms hereof.  The undersigned requests that the aforementioned Common
Stock  be  registered  in  the  name  of  whose  address  is
_____________________________________________.

Dated:________________________

Name  of  registered  holder  of  Warrant  Certificate:

_____________________________________________________________________________
                                 (please print)

Address  of  registered
holder:______________________________________________________

Signature:________________________________________

(Note:     the  signature  to the foregoing Election must correspond to the name
as written upon the face of the Warrant Certificate in every particular, without
alteration  or  any  change  whatsoever.)

<PAGE>
                                    EXHIBIT C
                                    ---------

                              Election to Purchase
             (To be executed by the registered holder if such holder
          desires to effect cashless exercise any Warrant Certificate)

     The undersigned, the registered holder of the attached Warrant Certificate,
hereby  irrevocably  elects  to  exchange  Warrants  represented by such Warrant
Certificate  and  acquire  an
aggregate of _________ shares of Common Stock of Telscape International, Inc., a
Texas  corporation  on  ___[DATE]____.  The  undersigned  requests  that  the
aforementioned  Common  Stock  be  registered  in  the  name of whose address is
__________________________  ___________________________________________.

Dated:_______________________________

Name  of  registered  holder  of  Warrant  Certificate:

_____________________________________________________________________________
                                 (please print)

Address  of  registered
holder:______________________________________________________

Signature:______________________________________

(Note:     the  signature  to the foregoing Election must correspond to the name
as written upon the face of the Warrant Certificate in every particular, without
alteration  or  any  change  whatsoever)

<PAGE>
                                   SCHEDULE 1
                                   ----------

                                                    Number  of
Purchaser                                            Warrants*
---------                                            ---------

TSG  Capital  Fund  III,  L.P.                       1,915,834

Opportunity  Capital  Partners  II,  L.P.,              86,212

Opportunity  Capital  Partners  III,  L.P.               9,579

*Subject  to  adjustment.

<PAGE>AMENDED AND RESTATED
                                WARRANT AGREEMENT
                                -----------------

     THIS AMENDED AND RESTATED WARRANT AGREEMENT (this "Agreement"), dated as of
                                                        ---------
January  24,  2000,  by  and  between  TELSCAPE  INTERNATIONAL,  INC.,  a  Texas
corporation (the "Company"), and the Investors identified on Schedule 1 attached
                  -------                                    ----------
hereto  (each  an  "Investor"  and  collectively,  the  "Investors").
                    --------                             ---------

                                R E C I T A L S:
                                ----------------

     WHEREAS,  concurrently  with  the execution and delivery of this Agreement,
the  Company  is issuing and selling to the Investors Warrants of the Company in
the  amount set forth on Schedule 1 attached hereto (being referred to herein as
                         ----------
the  "Warrants"),  such  Warrants  initially  entitling  the  holders thereof to
      --------
purchase  207,926  shares  of  common  stock of the Company par value $0.001 per
share  (the  "Common Stock"), subject to adjustment as hereinafter provided (the
              ------------
Common  Stock and, pursuant to Article 7 hereof, such other securities as may be
                               ---------
issuable  upon exercise of the Warrants being referred to herein as the "Warrant
                                                                         -------
Shares");  and
------

     WHEREAS,  the  Company  wishes  to  define  the terms and provisions of the
Warrants and the respective rights and obligations thereunder of the Company and
the  holders  of  the  Warrants  (the  "Warrantholders");
                                        --------------

     NOW,  THEREFORE,  in consideration of the foregoing recitals and the mutual
agreements  herein set forth, and for other good and valuable consideration, the
receipt  and  sufficiency  of  which are hereby acknowledged, the parties hereto
agree  as  follows:

                                    ARTICLE 1

                                   DEFINITIONS
     SECTION  1.1     Certain  Definitions.  As  used  in  this  Agreement,  the
                      --------------------
following  terms  have  the  meanings  specified  below:

     "Amended  Articles"  means  the  Amended  Articles  of Incorporation of the
      -----------------
Company  as  amended to include the Certificate of Designation setting forth the
rights,  preferences and privileges of the Class F Preferred Stock (as defined).

     "Board  of  Directors"  means  the  Board  of  Directors  of  the  Company.
      --------------------

     "Business  Day"  means any day other than Saturday, Sunday or any other day
      -------------
on  which  banking  institutions  in the City of Houston, Texas are permitted or
required  to  close.

     "Class  F  Preferred  Stock" means the Class F Convertible Senior Preferred
      --------------------------
Stock,  par  value  $0.001  per  share,  of the Company issued to the Investors.

                                     Page 1
<PAGE>
     "Exchange  Act"  means the Securities Exchange Act of 1934, as amended, and
      -------------
the  rules  and  regulations  promulgated  thereunder.

     "GAAP"  means  United  States  generally accepted accounting principles set
      ----
forth  in  opinions and pronouncements of the Accounting Principles Board of the
American  Institute  of  Certified  Public  Accountants  and  statements  and
pronouncements  of  the  Financial  Accounting  Standards Board or in such other
statements  by  such other entity as may be approved by a significant segment of
the  accounting  profession,  in  each  case  as  the same are applicable to the
circumstances  as  of  the  date  of  the  determination.

     "Merger"  means  the merger contemplated by that certain Agreement and Plan
      ------
of  Merger dated December 31, 1999, as amended, by and among the Company, Pointe
Communications  Corporation  and  Pointe  Acquisition  Corporation  (the "Merger
                                                                          ------
Agreement").
---------

     "Person"  means  an  individual,  corporation,  entity,  limited  liability
      ------
partnership  or  company,  partnership,  joint venture, association, joint stock
company,  trust,  unincorporated  organization,  or  government or any agency or
political  subdivision  thereof.

     "SEC"  means  the  Securities  and  Exchange  Commission  or  any successor
      ---
thereto.

     "Securities  Act"  means  the  Securities  Act of 1933, as amended, and the
      ---------------
rules  and  regulations  promulgated  thereunder.

     "Securities  Purchase  Agreement"  means  that certain Amended and Restated
      -------------------------------
Securities Purchase Agreement by and among the Company and the Investors of even
date  herewith.

                                     Page 2
<PAGE>
                                    ARTICLE 2

              ISSUANCE, FORM AND EXECUTION OF WARRANT CERTIFICATES

     SECTION  2.1     Issuance  of  Warrants.  The  Warrants shall be originally
                      ----------------------
issued by the Company in connection with the issuance of Class F Preferred Stock
pursuant  to the Securities Purchase Agreement.  The Warrants shall be evidenced
by  Warrant Certificates (as defined herein), and each Warrant Certificate shall
represent  the right, subject to the provisions contained herein and therein, to
purchase  from  the  Company  (and  the  Company  shall  issue  and  sell to the
registered holder of such Warrants) the number of shares of Common Stock (as may
be  adjusted  pursuant  to Article 7 hereof) issuable to such Warrantholder upon
                           ---------
exercise  of  such  Warrants,  at  the  price  specified  herein  and  therein.

     SECTION  2.2     Form of Warrant Certificates.  The certificates evidencing
                      ----------------------------
the  Warrants  (the "Warrant Certificates") shall be in registered form only and
                     --------------------
shall be substantially in the form set forth in Exhibit A attached hereto, shall
                                                ---------
be  dated  the  date  on  which signed by the Company and may have such letters,
numbers  or  other marks of identification or designation printed, lithographed,
engraved or otherwise affixed thereon as the Company may deem appropriate and as
are  not  inconsistent  with  the provisions of this Agreement or the Securities
Purchase  Agreement,  or  as  may be required to comply with any law or with any
rule  or  regulation  made  pursuant  thereto.

     SECTION  2.3      Execution  of Warrant Certificates.  Warrant Certificates
                       ----------------------------------
shall  be executed on behalf of the Company by the president, any vice president
or  the  treasurer  of  the Company and signed by the secretary or any assistant
secretary of the Company and have affixed thereon the seal of the Company.  Each
such  signature  and  seal  may  be  manual  or  facsimile.

     In case any officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be such officer before countersignature and delivery
by  the  Company, such Warrant Certificates, nevertheless, may be countersigned,
issued  and  delivered  with the same force and effect as though such person had
not  ceased  to  be  such  officer; and any Warrant Certificate may be signed on
behalf  of the Company by any person who, at the actual date of the execution of
such  Warrant Certificate, shall be a proper officer of the Company to sign such
Warrant  Certificate,  although  at  the date of the execution of this Agreement
such  person  was  not such an officer of the Company.  Upon countersignature on
behalf  of  the Company and delivery, the Warrant Certificate shall be valid and
binding upon the Company, and the Warrantholder thereof shall be entitled to all
of  the  benefits  of  this  Agreement.

                                     Page 3
<PAGE>
                                    ARTICLE 3

                                  REGISTRATION

     SECTION  3.1     Registration.  The  Company  shall number and register the
                      ------------
Warrant  Certificates  in a register (the "Warrant Register") maintained at 2700
                                           ----------------
Post  Oak  Boulevard, Suite 100, Houston, Texas 77056 (the "Office") as they are
                                                            ------
issued by the Company (or such other location as the Company may establish after
giving  notice thereof to the Warrantholders).  The Company shall keep copies of
this  Agreement  available  for  inspection  by the Warrantholders during normal
business  hours  at  the  Office.

                                    ARTICLE 4

            TRANSFER, EXCHANGE OR REPLACEMENT OF WARRANT CERTIFICATES

     SECTION  4.1     Registration of Transfers.  The Company shall from time to
                      -------------------------
time register the transfer of any outstanding Warrant Certificate on the Warrant
Register  maintained  at the Office, upon surrender thereof (i) accompanied by a
written instrument or instruments of transfer in form reasonably satisfactory to
the  Company,  (ii)  duly  endorsed  by the registered holder thereof or by such
Warrantholder's  appointed  legal  representative  or  attorney-in-fact,  or
accompanied  by  proper  evidence  of  succession,  assignment  or  authority to
transfer  and  (iii)  an  opinion of counsel that the Warrant was transferred in
compliance with all federal and state securities laws.  In all cases of transfer
by  an  attorney,  the original power of attorney, duly approved, or an official
copy  thereof,  duly  certified, shall be deposited and remain with the Company.
Upon  any such registration or transfer in such name or names as may be directed
in writing by the Warrantholder, the Company shall execute and deliver (or cause
to  be  delivered)  a  new  Warrant  Certificate(s)  without  charge  to  such
Warrantholder, or to the Person or Persons entitled to receive the same, and the
surrendered  Warrant  Certificate  shall  be  canceled  by  the  Company.

     SECTION  4.2  Exchanges  of Warrant Certificates.  Each Warrant Certificate
                   ----------------------------------
may  be  exchanged  at  the  option  of the Warrantholder without charge to such
Warrantholder when surrendered to the Company at the Office properly endorsed in
the manner described in Section 4.1 hereof for another Warrant Certificate(s) of
                        -----------
like  tenor  and representing in the aggregate a like number of shares of Common
Stock,  as may be adjusted pursuant to Article 7 hereof.  Thereupon, the Company
                                       ---------
shall  execute  and  deliver  to  the  Person(s)  entitled thereto a new Warrant
Certificate(s)  as  so requested.  Warrant Certificates surrendered for exchange
shall  be  canceled  by  the  Company.

                                     Page 4
<PAGE>
     SECTION  4.3     Mutilated  or  Missing Warrant Certificates.  In the event
                      -------------------------------------------
that  any Warrant Certificate shall be mutilated, lost, stolen or destroyed, the
Company  shall  execute  and  deliver  in exchange and substitution for and upon
cancellation  of  the  mutilated  Warrant  Certificate,  or  in  lieu  of  and
substitution  for  the  Warrant  Certificate  lost,  stolen  or destroyed, a new
Warrant Certificate of like tenor and representing Warrants for a like amount of
Warrant  Shares,  but  only,  in  case  of  a  lost, stolen or destroyed Warrant
Certificate,  upon receipt of evidence satisfactory to the Company of such loss,
theft  or destruction and, upon the Company's request, evidence of indemnity and
bond satisfactory to the Company and the absence of actual notice to the Company
that  such  Warrant  Certificate  has  been acquired by a bona fide purchaser or
holder  in  due  course.  Every  substitute  Warrant  Certificate  executed  and
delivered  pursuant to this Section 4.3 in lieu of any lost, stolen or destroyed
                            -----------
warrant Certificate shall constitute an additional contractual obligation of the
Company,  whether or not the lost, stolen or destroyed Warrant Certificate shall
be  at  any time enforceable by anyone, and shall be entitled to the benefits of
(but  shall  be  subject  to  all  the  limitations of rights set forth in) this
Agreement  equally  and  proportionately  with  any  and  all  other  Warrant
Certificates  duly  executed  and  delivered  hereunder.  The provisions of this
Section  4.3  are  exclusive with respect to the replacement of mutilated, lost,
    --------
stolen  or  destroyed  Warrant  Certificates.

                                    ARTICLE 5

              EXERCISE OF WARRANTS; EXERCISE PRICE; EXERCISE PERIOD

     SECTION  5.1  Exercise  of  Warrants.  Subject  to  the  provisions of this
                   ----------------------
Agreement,  each Warrantholder shall have the right to purchase from the Company
the  number  of shares of Common Stock that the Warrantholder may at the time be
entitled  to  purchase  on  exercise of the Warrants and payment of the Exercise
Price  (as  defined  below)  for  such  Warrant  Shares.

     SECTION  5.2     Mechanics  of  Exercise.
                      -----------------------

     (a)     Subject  to  the  provisions  of  this  Agreement,  Warrants may be
exercised  by the Warrantholder in whole or in part upon surrender at the Office
to  the  Company of the Warrant Certificate(s) evidencing the Warrants, together
with  the form of election to purchase (the "Election to Purchase"), in the form
                                             --------------------
set  forth  as Exhibit B hereto or in the form set forth as Exhibit C hereto (in
               ---------                                    ------- -
the  case of a Warrant Exchange (as defined)), duly completed and signed by such
Warrantholder  or  by  such  Warrantholder's  appointed  legal representative or
attorney-in--fact  and  upon  payment  in  full  of  the Exercise Price for each

                                     Page 5
<PAGE>
Warrant  exercised  (except  in the case of a Warrant Exchange).  Payment of the
aggregate  Exercise  Price  shall  be  made  by certified or official bank check
payable to the order of the Company or by wire transfer to an account designated
by  the  Company.

     (b)     Upon  due  exercise  of  the  Warrants and surrender of the Warrant
Certificate,  duly  completed  and signed, and payment of' the Exercise Price as
aforesaid,  the Company shall cause to be issued to or upon the written order of
the  Warrantholder  and in such name or names as the Warrantholder may designate
in  the  Election  to  Purchase,  the  Warrant  Shares so purchased.  In lieu of
delivering  physical  certificates representing the Warrant Shares, provided the
Company's  transfer  agent  is participating in the Depositary Trust Issuer Fast
Automated  Securities  Transfer  ("FAST")  program,  upon  request  of  the
                                   ----
Warrantholder,  the  Company  shall  use  its best efforts to cause its transfer
agent  to  electronically  transmit the Warrant Shares issuable upon exercise of
the Warrants to the holder by crediting the account of the Warrantholder's prime
broker  with  Depositary  Trust  Company  through  its  Deposit Withdrawal Agent
Commission  system  (an "Electronic Transfer").  If all of the items referred to
                         -------------------
in  the first sentence of the preceding paragraph are received by the Company at
or  prior  to  1:00  p.m.,  Texas  time,  on a Business Day, the exercise of the
Warrants  to which such items relate will be effective on such Business Day.  If
all  of  such items are received after 1:00 p.m., Texas time, on a Business Day,
the exercise of the Warrants to which such items relate will be effective on the
next  Business  Day.

     (c)     The  number  and  kind  of Warrant Shares for which Warrants may be
exercised  shall  be  subject  to  adjustment  from time to time as set forth in
Article  7  hereof.
----------

     (d)     The  Warrants  shall  be  exercisable  as  provided  herein  at the
election of the Warrantholder in whole or in part.  In the event that the holder
of  a Warrant Certificate shall exercise Warrants with respect to fewer than all
the  Warrant  Shares  evidenced thereby, a new Warrant Certificate(s) evidencing
the  remaining unexercised Warrant Shares shall be issued to such Warrantholder,
and  the  Company  is  hereby  irrevocably authorized to execute and deliver the
required  new  Warrant  Certificate(s)  pursuant  to provisions of Article 2 and
                                                                   ---------
Article  3  of  this  Agreement.
    ------

     (e)     All  Warrant  Certificates  surrendered  upon  exercise of Warrants
shall  be  canceled  and  disposed  of  by  the  Company.

     (f)  All  Warrant  Shares  shall  bear  the  following  legend:

          The  shares  represented  by  this  certificate  were  not issued in a
          transaction  registered  under  the Securities Act of 1933, as amended
          (the  "Securities  Act"), or any applicable state securities laws. The

                                     Page 6
<PAGE>
          shares  represented  hereby  have been acquired for investment and may
          not  be sold or transferred unless such sale or transfer is covered by
          an  effective  registration  statement  under  the  Securities Act and
          applicable state securities laws or, in the written opinion of counsel
          to  the  issuer,  is  exempt from the registration requirements of the
          Securities  Act  and  such  laws.

     SECTION  5.3     Exercise  Price.  The  price at which each of the Warrants
                      ---------------
shall  be exercisable in exchange for Warrant Shares shall be $10.00 per Warrant
Share  (as  such  price  may  be  adjusted  pursuant to Article 7 hereof) (being
                                                        ---------
referred  to  herein  as  the  "Exercise  Price").
                                ---------------

     SECTION  5.4     Exercise Period.  The right to exercise the Warrants shall
                      ---------------
terminate  on the date which is the fifth anniversary of the date of issuance of
the  Warrants (the "Expiration Date").  A Warrantholder may exercise any Warrant
                    ---------------
from  the date of issuance up to and including the Expiration Date.  The Company
shall  record  the  Expiration  Date  of  each  Warrant in the Warrant Register.

     SECTION  5.5     Cashless Exercise.
                      ------------------

     (a)     At  any  time  prior  to  the  Expiration Date of any Warrants, the
Warrantholder may, at its option, exchange such Warrants, in whole or in part (a
"Warrant  Exchange"),  into  the number of fully paid and non-assessable Warrant
 -----------------
Shares  determined  in  accordance  with  this  Section 5.5, by surrendering the
 -                                              -----------
Warrant  Certificate  relating  to such Warrants at the Office, accompanied by a
notice stating such Warrantholder's intent to effect such cashless exchange, the
number of Warrant Shares to be issued upon such Warrant Exchange and the date on
which  the Warrantholder requests that such cashless Warrant Exchange occur (the
"Notice  of  Exchange").  The  cashless Warrant Exchange shall take place on the
 --------------------
date  specified  in the Notice of Exchange, or, if later, the date the Notice of
Exchange is received by the Company (the "Exchange Date").  Certificates for the
                                          -------------
Warrant  Shares issuable upon such cashless Warrant Exchange and, if applicable,
a  new  Warrant  Certificate of like tenor evidencing the balance of the Warrant
Shares  remaining  subject  to the Warrantholder's Warrant Certificate, shall be
issued  as  of the Exchange Date and delivered to the Warrantholder within three
Business  Days  following  the  Exchange  Date,  or  by Electronic Transfer.  In
connection  with  any  cashless  Warrant  Exchange,  the Warrantholder's Warrant
Certificate shall represent the right to subscribe for and acquire the number of

                                     Page 7
<PAGE>
Warrant  Shares (rounded to the next highest integer) equal to (A) the number of
Warrant  Shares  specified  by  the Warrantholder in its Notice of Exchange (the
"Total  Share  Number")  less  (B)  the  number  of  Warrant Shares equal to the
 --------------------
quotient  obtained by dividing (i) the product of the Total Share Number and the
-------
existing Exercise Price per Warrant Share by (ii) the Market Price (as hereafter
defined)  of  a  share  of  Common  Stock.

     (b)     As  used in this Section 5.5, the phrase "Market Price" at any date
                              -----------              ------------
shall be deemed to be the last reported sale price, or, in case no such reported
sale  takes  place on such day, the average of the last reported sale prices for
the  last  three  trading  days,  in  either  case as officially reported by the
principal securities exchange on which the Common Stock is listed or admitted to
trading  or  by  the  NASDAQ Stock Market National Market ("NASDAQ"), or, if the
                                                            ------
Common  Stock  is  not  listed or admitted to trading on any national securities
exchange  or quoted by NASDAQ, the average closing bid price as furnished by the
National  Association  of  Securities  Dealers,  Inc. ("NASD") through NASDAQ or
                                                        ----
similar  organization  if  NASDAQ is no longer reporting such information, or if
the  Common Stock is not quoted on NASDAQ, any exchange or similar organization,
as  determined  in  good  faith  by  resolution of the Board of Directors of the
Company,  based  on  the  best  information  available  to  it  for the two days
immediately  preceding  such  issuance  or  sale and the day of such issuance or
sale.

SECTION  5.6     Mandatory  Exercise.
                 -------------------

     (a)     In  the  event the Market Price of the Common Stock for twenty (20)
consecutive trading days is equal to at least $15.00 per share (as appropriately
adjusted  for  stock  splits,  stock dividends, combinations, recapitalizations,
reclassifications,  mergers,  consolidations  and  other  similar  events),  the
Company  shall  have the right to cause the exercise of the Warrants at any time
thereafter  by the Warrantholders by giving written notice to each Warrantholder
of  such  election  (a  "Mandatory Exercise Election Notice"); provided that the
                         ----------------------------------
Warrant  Shares  issuable  upon  such  exercise  shall  have been Registered (as
defined)  and  listed on each securities exchange, over-the-counter market or on
the NASDAQ National Market on which similar Securities issued by the Company are
then  listed.  "Registered"  refers  to a registration effected by preparing and
                ----------
filing  with the SEC, a registration statement in compliance with the Securities
Act,  as  amended,  and  the  declaration  or  ordering by the Commission of the
effectiveness  of  such  registration  statement.

                                     Page 8
<PAGE>
     (b)     Upon  receipt  of  a  Mandatory  Exercise  Election  Notice,  each
Warrantholder  shall  have  the  right to exercise its Warrants on the terms and
conditions  herein  (including  Section  5.5);  provided,  however,  that  the
                                ------------    --------   -------
Expiration  Date  with  respect  to such Warrants shall be deemed to be the date
that  is  fifteen (15) Business Days immediately after the date of the Mandatory
Exercise  Election  Notice.

                                    ARTICLE 6

                          RESERVATION OF WARRANT SHARES

     SECTION 6.1     Reservation.  The Company shall at all times keep reserved,
                     -----------
free  from  preemptive  rights,  out  of  its  authorized Common Stock, or other
securities  of  the Company issuable upon the exercise of the Warrants, a number
of  shares  of Common Stock, or such other securities, sufficient to provide for
the  exercise  of'  the  right  of  purchase  represented by all outstanding and
unexpired  Warrants.

     SECTION  6.2     Covenant.  The  Company  covenants that any Warrant Shares
                      --------
will,  upon  issuance,  be validly issued and upon payment of the exercise price
therefor,  fully  paid  and  free  from all taxes payable by the Company, liens,
charges  and security interests (except any liens, charges or security interests
created or suffered to be created by any of the Warrantholders), and will not be
subject  to  any  restrictions on voting or transfer thereof that are created by
the  Company,  except for such restrictions on transfer under the Securities Act
or  applicable  state  securities  laws.

                                    ARTICLE 7

                 ADJUSTMENTS AFFECTING THE EXERCISE OF WARRANTS

     SECTION  7.1     Special  Definitions.  For purposes of this Article 7, the
                      --------------------                        ---------
following  definitions  shall  apply:

     (a)     "Additional Shares of Common Stock" shall mean all shares of Common
              ---------------------------------
Stock  issued  (or,  pursuant  to Section 7.2 below, deemed to be issued) by the
                                  -----------
Company  after  the Original Issue Date (hereinafter defined), other than shares
of  Common  Stock  issued  or  issuable:

          (i)     upon  conversion  of shares of the Company's Class F Preferred
Stock  outstanding  on  the  Original  Issue  Date;

          (ii)     by  reason  of  a  dividend,  stock  split, split-up or other
distribution  of  shares  of  the  Class  F  Preferred  Stock  or  Common Stock;

          (iii)     as  a  dividend  or  distribution  on  the Company's Class F
Preferred  Stock  or  such  warrants;

                                     Page 9
<PAGE>
          (iv)     as  a  part  of,  or  in  connection  with,  the  Merger;

          (v)     in  connection  with  any  other  merger, acquisition or other
transaction by the Company, in either case approved by the Investors, unless the
Company  agrees  to include such issuance in the definition of Additional Shares
of  Common  Stock  in connection with obtaining the approval of the Investors to
such  acquisition  or  other  transaction;

          (vi)     upon  the exercise of options excluded from the definition of
"Option"  in  Section  7.1(c)  and  "Convertible  Securities" in Section 7.1(b).
              ---------------                                    --------------

          (vii)     by  reason  of  a  dividend, stock split, split--up or other
distribution  on  shares  of  Common  Stock  excluded  from  the  definition  of
Additional  Shares  of  Common  Stock by the foregoing clauses (i), (ii), (iii),
(iv),  (v),  and  (vi)  or  this  clause  (vii);

     (b)     "Convertible  Securities" shall mean any evidences of indebtedness,
              -----------------------
shares  or  other  securities  directly  or  indirectly  convertible  into  or
exchangeable  for  Common  Stock,  other  than  (i) securities excluded from the
definition of "Option" in Section 7.1(c), (ii) outstanding on the Original Issue
                          --------------
Date,  (iii)  issued  as part of, or in connection with, the Merger, or (iv) the
Class  C  Convertible  Senior  Preferred  Stock  of  the  Company  (the "Class C
                                                                         -------
Preferred  Stock").
----------------

     (c)     "Option"  shall  mean rights, options or warrants to subscribe for,
              ------
purchase  or otherwise acquire Common Stock or Convertible Securities, excluding
(i)  options  granted to employees, officers, directors or issued to consultants
of the Company or its subsidiaries or rights, warrants or convertible securities
which,  in  each  case,  are outstanding as of the Original Issue Date, (ii) any
warrants outstanding on the Original Issue Date, issued under this Agreement, or
issued  in  connection  with  the issuance of the Class F Preferred Stock, (iii)
options  granted  to  employees,  officers, directors or consultants pursuant to
stock  option  plans  adopted  by  the  Board  of  Directors and approved by any
Compensation  Committee  of  the Board of Directors, (iv) any rights, options or
warrants  to  subscribe for, purchase or otherwise acquire Common Stock or other
Convertible  Securities  issued as a part of, or in connection with, the Merger,
or  (v)  any  warrants  issued  in  connection  with the issuance of the Class C
Preferred  Stock.

                                    Page 10
<PAGE>
     (d)     "Original  Issue  Date"  shall mean the date on which a Warrant was
              ---------------------
first  issued.

     SECTION  7.2     Issue  of  Securities Deemed Issue of Additional Shares of
                      ------------------------------------- --------------------
Common  Stock.  If  the  Company  at  any  time  or  from time to time after the
--------------
Original  Issue Date shall issue any Options or Convertible Securities, then the
maximum  number  of  shares  of  Common  Stock  (as  set forth in the instrument
relating  thereto  without  regard  to  any  provision  contained  therein for a
subsequent adjustment of such number) issuable upon the exercise of such Options
or,  in  the case of Convertible Securities and Options therefor, the conversion
or  exchange  of  such  Convertible  Securities and the exercise of such Options
therefor,  shall  be deemed to be Additional Shares of Common Stock issued as of
the time of such issuance, provided that Additional Shares of Common Stock shall
not be deemed to have been issued unless the consideration per share (determined
pursuant  to Section 7.4 hereof) of such Additional Shares of Common Stock would
             -----------
be  less  than the applicable Exercise Price in effect immediately prior to such
issuance  and  provided further that in any such case in which Additional Shares
of  Common  Stock  are  deemed  to  be  issued:

     (a)     No  further adjustment in the Exercise Price shall be made upon the
subsequent issuance of Convertible Securities or shares of Common Stock upon the
exercise  of  such  Options  or  conversion  or  exchange  of  such  Convertible
Securities;

     (b)     If  such  Options or Convertible Securities by their terms provide,
with  the  passage  of  time or otherwise, for any increase in the consideration
payable  to  the  Company,  or  decrease in the number of shares of Common Stock
issuable,  upon the exercise, conversion or exchange thereof, the Exercise Price
computed  upon  the  original  issuance  thereof, and any subsequent adjustments
based  thereon, shall, upon any such increase or decrease becoming effective, be
recomputed  to  reflect  such  increase  or  decrease insofar as it affects such
Options  or  the  rights  of  conversion  or  exchange  under  such  Convertible
Securities;

     (c)     No  readjustment pursuant to clause (b) above shall have the effect
of  increasing  the Exercise Price to an amount which exceeds the Exercise Price
on  the  original  adjustment  date;  and

     (d)     In  the event of any change in the number of shares of Common Stock
issuable  upon the exercise, conversion or exchange of any Option or Convertible
Security,  including,  but  not  limited  to,  a  change  resulting  from  the

                                    Page 11
<PAGE>
anti-dilution  provisions  thereof,  the  Exercise  Price  then  in effect shall
forthwith  be  readjusted  to such Exercise Price as would have obtained had the
adjustment  which  was  made  upon  the  issuance  of such Option or Convertible
Security  which have not been exercised or converted prior to such change in the
number of shares of Common Stock been made upon the basis of such change, but no
further  adjustment  shall  be made for the actual issuance of Common Stock upon
the  exercise  or  conversion  of  any  such  option  or  Convertible  Security.

     SECTION  7.3     Adjustment  of  Exercise Price Upon Issuance of Additional
                      ----------------------------------------------------------
Shares  of  Common  Stock.  In the event the Company shall at any time after the
  -----------------------
Original  Issue  Date  issue  Additional  Shares  of  Common  Stock  (including
Additional  Shares  of Common Stock deemed to be issued pursuant to Section 7.2,
                                                                    -----------
but excluding shares issued as a dividend or distribution as provided in Section
                                                                         -------
7.6  or  upon  a stock split or combination as provided in Section 7.5), without
---                                                        -----------
consideration  or  for a consideration per share (determined pursuant to Section
                                                                         -------
7.4  hereof) less than the applicable Exercise Price in effect immediately prior
---
to  such issuance, then and in such event, such Exercise Price shall be reduced,
concurrently  with  such  issuance,  to  an  Exercise  Price  equal to the price
determined by dividing (a) the sum of (1) the product derived by multiplying the
Exercise  Price  in  effect  immediately prior to such issuance by the number of
shares  of Common Stock outstanding immediately prior to such issuance (together
with  the  number  of  shares of Common Stock then issuable upon exercise of the
outstanding  Warrants  and  the  conversion  or  exercise  of  any  Convertible
Securities  or  Options  (including,  for  this  purpose,  any securities of the
Company  which  would be excluded from the definitions of Convertible Securities
and  Options  pursuant  to  Sections  7.1(b)  and  (c))), plus (2) the aggregate
                            --------------------------
consideration received by the Corporation (as determined pursuant to Section 7.4
                                                                     -----------
below)  upon  such  issuance,  by  (b)  the  number  of  shares  of Common Stock
outstanding  immediately after such issuance (together with the number of shares
of  Common Stock then issuable upon exercise of the outstanding Warrants and the
conversion  or exercise of any Convertible Securities or Options (including, for
this  purpose,  any  securities  of the Company which would be excluded from the
definitions  of  Convertible  Securities and Options pursuant to Sections 7.1(b)
                                                                 ---------------
and  (c))).
--------

     No  adjustment  of  the Exercise Price, however, shall be made in an amount
less  than  $0.01  per  share,  and  any such lesser adjustment shall be carried
forward  and  shall  be  made  a  the time and together with the next subsequent
adjustment  which  together with any adjustments so carried forward shall amount
to  $0.01  per  share  or  more.  Any adjustments to the Exercise Price shall be
rounded  to  the  nearest  $0.01  per  share.

                                    Page 12
<PAGE>
     SECTION 7.4 Determination of Consideration. For purposes of this Section 7,
                 ------------------------------                        ---------
the  consideration  received  by  the Company for the issuance of any Additional
Shares  of  Common  Stock  shall  be  computed  as  follows:

     (a)     Cash  and  Property.  Such  consideration  shall:
             -------------------

          (i)     insofar  as  it consists of cash, be computed at the aggregate
of  cash  received by the Company, excluding amounts paid or payable for accrued
interest  or  accrued  dividends;

          (ii)     insofar  as  it  consists  of  property  other  than cash, be
computed  at  the  fair  market  value  thereof at the time of such issuance, as
determined  in  good  faith  by  the  Board  of  Directors;  and

          (iii)     in  the  event  Additional Shares of Common Stock are issued
together  with  other  shares  of  securities or other assets of the Company for
consideration  which  covers  both,  be  the proportion of such consideration so
received,  computed  as provided in clauses (i) and (ii) above, as determined in
good  faith  by  the  Board  of  Directors.

     (b)     Options  and  Convertible  Securities.  The consideration per share
             -------------------------------------
received  by  the  Company  for Additional Shares of Common Stock deemed to have
been  issued  pursuant  to  Section  7.2,  relating  to  Options and Convertible
                            ------------
Securities,  shall  be determined by dividing the total amount, if any, received
or  receivable  by the Company as consideration for the issuance of such Options
or  Convertible  Securities,  plus  the  minimum  aggregate amount of additional
consideration  (as set forth in the instruments relating thereto, without regard
to  any  provision  contained  therein  for  a  subsequent  adjustment  of  such
consideration)  payable  to the Company upon the exercise of such Options or the
conversion or exchange of such Convertible Securities, or in the case of Options
for  Convertible  Securities,  the  exercise  of  such  options  for Convertible
Securities and the conversion or exchange of such Convertible Securities, by the
maximum  number  of  shares  of  Common  Stock  (as set forth in the instruments
relating  thereto,  without  regard  to  any  provision  contained therein for a
subsequent adjustment of such number) issuable upon the exercise of such options
or  the  conversion  or  exchange  of  such  Convertible  Securities.

     SECTION  7.5     Adjustment  for  Stock  Splits  and  Combinations.  If the
                      -------------------------------------------------
Company shall at any time or from time to time after the Original Issue Date for
the  Warrants effect a subdivision of the outstanding Common Stock, the Exercise
Price  of  each Warrant then in effect immediately before that subdivision shall
be  proportionately  decreased and the number of shares of Common Stock issuable
upon  exercise  of  such  Warrant  shall  be  proportionately increased.  If the

                                    Page 13
<PAGE>
Company shall at any time or from time to time after the Original Issue Date for
the  Warrants combine the outstanding shares of Common Stock, the Exercise Price
of  each  Warrant  then  in  effect  immediately before the combination shall be
proportionately increased and the number of shares of Common Stock issuable upon
exercise  of  such  Warrant  shall be proportionately decreased.  Any adjustment
under  this  Section  7.5 shall become effective at the close of business on the
             ------------
date  the  subdivision  or  combination  becomes  effective.

     SECTION 7.6     Adjustment for Certain Dividends and Distributions.  In the
                     ------------------------------------ -------------
event the Company at any time or from time to time after the Original Issue Date
for the Warrants shall make or issue a dividend or other distribution payable in
additional  shares  of  Common  Stock,  then and in each such event the Exercise
Price  for the Warrants then in effect shall be decreased as of the time of such
issuance  or,  in  the event such a record date shall have been fixed, as of the
close of business on such record date, by multiplying the Exercise Price for the
Warrants  then  in  effect  by  a  fraction:

     (a)     the  numerator  of  which  shall  be  the total number of shares of
Common  Stock  issued  and  outstanding  immediately  prior  to the time of such
issuance  or  the  close  of  business  on  such  record  date,  and

     (b)     the  denominator  of  which  shall be the total number of shares of
Common  Stock  issued  and  outstanding  immediately  prior  to the time of such
issuance  or the close of business on such record date plus the number of shares
of  Common Stock issuable in payment of such dividend or distribution; provided,
                                                                       --------
however,  if  such  record  date  shall have been fixed and such dividend is not
-------
fully paid or if such distribution is not fully made on the date fixed therefor,
the  Exercise  Price  for the Warrants shall be recomputed accordingly as of the
close  of business on such record date and thereafter the Exercise Price for the
Warrants  shall  be adjusted pursuant to this paragraph as of the time of actual
payment  of  such  dividends  or  distributions.

     The  number  of  Warrant  Shares issuable upon the exercise of the Warrants
shall  be adjusted by multiplying a number equal to the Exercise Price in effect
immediately  prior  to such adjustment by the number of shares issuable upon the
exercise  of  the Warrants immediately prior to such adjustment and dividing the
product  so  obtained  by  the  adjusted  Exercise  Price.

     SECTION  7.7     Adjustments for Other Dividends and Distributions.  In the
                      -------------------------------------------------
event the Company at any time or from time to time after the Original Issue Date
for the Warrants shall make or issue a dividend or other distribution payable in
securities  of  the  Company other than shares of Common Stock, then and in each

                                    Page 14
<PAGE>
such  event  provision  shall  be made so that the holders of the Warrants shall
receive  upon  exercise  thereof  in  addition to the number of shares of Common
Stock  receivable  thereupon,  the amount of securities of the Company that they
would  have received had their Warrants been exercised on the date of such event
and  had  thereafter,  during  the  period  from  the  date of such event to and
including  the  conversion  date, retained such securities receivable by them as
aforesaid  during  such  period giving application to all adjustments called for
during  such  period,  under  this  paragraph  with respect to the rights of the
holders  of  the  Warrants.

     SECTION 7.8     Adjustment for Reclassification, Exchange, or Substitution.
                     ----------------------------------------------------------
If  the Common Stock issuable upon the exercise of the Warrants shall be changed
into  the same or a different number of shares of any class or classes of stock,
whether  by  capital reorganization, reclassification or otherwise (other than a
subdivision  or combination of shares or stock dividend provided for above, or a
reorganization,  merger,  consolidation,  or sale of assets provided for below),
then  and  in  each  such  event the holder of the Warrants shall have the right
thereafter to convert each such share of Common Stock issuable upon the exercise
of the Warrants into the kind and amount of shares of stock and other securities
and  property  receivable  upon  such reorganization, reclassification, or other
change,  by  holders  of  the  number  of  shares of Common Stock for which such
Warrants  might  have  been  exercised immediately prior to such reorganization,
reclassification,  or  change,  all  subject  to  further adjustment as provided
herein.

     SECTION  7.9     Adjustment  for  Merger or Reorganization.  In case of any
                      -----------------------------------------
consolidation  or  merger  of  the  Company  with  or into another Company, each
Warrant  shall  thereafter  be  exercisable for the kind and amount of shares of
stock  or other securities or property to which a holder of the number of shares
of  Common  Stock of the Company deliverable upon exercise of such Warrant world
have  been  entitled  upon  such  consolidation  or  merger;  and, in such case,
appropriate  adjustment  (as determined in good faith by the Board of Directors)
shall  be  made in the application of the provisions in this Article 7 set forth
                                                             ---------
with  respect  to  the  rights  and  interest  thereafter  of the holders of the
Warrants,  to the end that the provisions set forth in this Article 7 (including
                                                            ---------
provisions  with  respect  to  changes  in and other adjustments of the Exercise
Price)  shall  thereafter  be  applicable,  as  nearly  as reasonably may be, in
relation  to  any  shares of stock or other property thereafter deliverable upon
the  exercise  of  the  Warrants.

                                    Page 15
<PAGE>
     SECTION  7.10  Notice  of  Adjustment to Exercise Price and Warrant Shares.
                    -----------------------------------------------------------

          (a)     Whenever  the  Exercise  Price  is  required to be adjusted as
provided  in  this Article 7, simultaneously with the adjustment of the Exercise
                   ---------
Price,  the  number of Warrant Shares issuable upon the exercise of the Warrants
shall  be adjusted by multiplying a number equal to the Exercise Price in effect
immediately  prior  to such adjustment by the number of shares issuable upon the
exercise  of  the Warrants immediately prior to such adjustment and dividing the
product  so  obtained  by  the  adjusted  Exercise  Price.

          (b)     Whenever  the  Exercise  Price  is  required to be adjusted as
provided in this Article 7, or any other adjustment is required pursuant to this
                 ---------
Article  7,  the Company shall forthwith compute the adjusted Exercise Price and
----------
the corresponding number of Warrant Shares purchaseable upon the exercise of the
Warrants  or  any  other  adjustment  made  pursuant to this Article 7 and shall
                                                             ---------
prepare  a  certificate  setting  forth  such  adjusted  Exercise  Price and the
corresponding  number  of  Warrant  Shares purchaseable upon the exercise of the
Warrants  or any other adjustment made pursuant to this Article 7 and showing in
                                                        ---------
reasonable detail the facts upon which such adjustments are based.  Whenever the
Exercise  Price and the corresponding number of Warrant Shares purchaseable upon
the  exercise  of  the  Warrants  are  adjusted  or any other adjustment is made
pursuant  to  this  Article  7,  the Company shall promptly mail, or cause to be
                    ----------
mailed,  to the Warrantholders a statement setting forth the adjustments and the
reasons  for  such  adjustments.

     SECTION  7.11     Form  of  Warrant  Certificate.  Irrespective  of  any
                       ------------------------------
adjustments in the Exercise Price or the kind of Warrant Shares purchasable upon
the  exercise  of  the  Warrants,  Warrant Certificates evidencing such Warrants
theretofore  or  thereafter  issued  may continue to express the same number and
kind  of  Warrant  Shares  as  are  stated in the Warrant Certificates initially
issuable  pursuant  to  this  Agreement.

     SECTION  7.12     No  Impairment.  Without  limiting  the generality of the
                       --------------
foregoing,  the  Company  shall  take  all  such  action  as may be necessary or
appropriate  in  order that the Warrant Shares to be issued upon the exercise of
the  Warrants from time to time outstanding will, when issued, be fully paid and
non-assessable.  In  addition,  without  limiting the generality of Section 6.1,
                                                                    -----------
the  Company shall take all such action as shall be necessary so that, after any
adjustment  to the Exercise Price required hereunder, the total number of shares

                                    Page 16
<PAGE>
of  Common  Stock  or  other capital stock of the Company then authorized by the
Amended  Articles  and  available for the purpose of issuance upon such exercise
shall  exceed  the  total  number  of  shares  of Common Stock issuable upon the
exercise of all of the outstanding Warrants.  The Company will not, by amendment
of  its  Articles  of  Incorporation  or through any reorganization, transfer of
assets,  consolidation,  merger, dissolution, issue or sale of securities or any
other  voluntary action, avoid or seek to avoid the observance or performance of
any  of the terms to be observed or performed hereunder by the Company, but will
at  all  times in good faith assist in the carrying out of all the provisions of
this  Article  7  and  in  the  taking of all such action as may be necessary or
      ----------
appropriate  in  order  to  protect  the  rights  of  the Warrantholders against
impairment.

                                    ARTICLE 8

                                     NOTICES

     SECTION  8.1  Notices  to  Warrantholders.
                   ---------------------------

          (a)     Notices  to  holders  of  Warrants  shall be delivered to such
holders at the addresses of such holders as they appear in Section 8.2 hereof or
                                                           -----------
in  the  Warrant  Register (in the case of transfers).  Any such notice shall be
sufficiently  given if sent by first-class certified or registered mail, postage
prepaid,  facsimile  or  overnight  courier.

          (b)     In  the  event  (i)  of any consolidation or merger or binding
exchange  of interests to which the Company is a party and for which approval of
the  Investor  or any holders of equity interests of the Company is required, or
of  the  conveyance  or  sale  of  all or substantially all of the assets of the
Company,  or of any change of the Common Stock or other securities issuable upon
exercise  of  the  Warrants;  or (ii) the Company shall make any distribution in
respect  of  the  Common  Stock;  or  (iii)  of  the  voluntary  or  involuntary
dissolution,  liquidation  or  winding up of the Company; then the Company shall
send  to  each  Warrantholder  at least thirty days prior to the applicable date
hereinafter  specified,  a  written  notice  stating  (A)  the  date  for  the
determination  of the holders of Common Stock (or other Securities issuable upon
the exercise of the Warrants) entitled to receive any such distribution, (B) the
initial expiration date Set forth in any offer for exchange of interests, or (C)
the  date  on  which  any  such  consolidation,  merger,  exchange of interests,
conveyance,  transfer,  reclassification, dissolution, liquidation or winding up
is  expected  to become effective or consummated, and the date as of which it is
expected  that  holders  of record of Common Stock (or other securities issuable

                                    Page 17
<PAGE>
upon  the  exercise  of  the Warrants) shall be entitled to exchange such Common
Stock  for  securities  or  other  property,  if  any,  deliverable  upon  such
reclassification,  consolidation,  merger,  exchange  of  interests, conveyance,
transfer,  dissolution,  liquidation  or  winding  up.

     SECTION  8.2  Notices  to Company.  Any notice or demand authorized by this
                   -------------------
Agreement  to  be  given to or on the parties shall be delivered in person or by
facsimile  transmission, by courier guaranteeing overnight delivery or mailed by
first-class  United  States  certified  or  registered mail, postage prepaid, as
follows:

a)     if  to  the  Company:

          Telscape  International,  Inc.
          2700  Post  Oak  Boulevard
          Suite  100
          Houston,  Texas  77056
          Attention:  Todd  M.  Binet
          Facsimile:  (713)  968-0930

     with  a  copy  to:

          Gardere  &  Wynne,  L.L.P.
          3000  Thanksgiving  Tower
          1601  Elm  Street
          Dallas,  Texas  75201-4761
          Attention:  W.  Robert  Dyer,  Jr.
          Facsimile:  (214)  999-3574

(b)     if  to  the  Investors:  at  the addresses set forth on their respective
signature  pages.

SECTION  8.3   Receipt  of Notice.  Any notice hereunder shall be in writing and
               ------------------
shall  be  deemed effectively given and received upon delivery in person, or two
business  days  after  delivery  by  national  overnight  courier  service or by
telecopier  transmission  with  acknowledgment  of transmission receipt, or five
business  days  after  deposit  via certified or registered mail, return receipt
requested.

                                    Page 18
<PAGE>
                                    ARTICLE 9

                                  MISCELLANEOUS

     SECTION  9.1     WAIVER  OF  JURY  TRIAL.  THE  COMPANY  AND  EACH  OF  THE
                      -----------------------
INVESTORS  DOES  HEREBY  KNOWINGLY,  VOLUNTARILY,  INTENTIONALLY AND IRREVOCABLY
WAIVE SUCH RIGHT ANY PARTY MAY HAVE TO A JURY TRIAL IN EVERY JURISDICTION IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY OF THE PARTIES HERETO OR THEIR
RESPECTIVE  AFFILIATES,  SUCCESSORS OR ASSIGNS AGAINST ANY OTHER PARTY HERETO OR
THEIR  RESPECTIVE  AFFILIATES,  SUCCESSORS  OR  ASSIGNS IN RESPECT OF ANY MATTER
ARISING  OUT  OF  OR  IN  CONNECTION  WITH  THIS AGREEMENT OR ANY OTHER DOCUMENT
EXECUTED  AND DELIVERED BY ANY PARTY IN CONNECTION THEREWITH (INCLUDING, WITHOUT
LIMITATION,  ANY  ACTION  TO RESCIND OR CANCEL THIS AGREEMENT, AND ANY CLAIMS OR
DEFENSES  ASSERTING  THAT  THIS  AGREEMENT WAS FRAUDULENTLY INDUCED OR OTHERWISE
VOID  OR  VOIDABLE).

     SECTION  9.2      Payment  of Taxes.  The Company covenants and agrees that
                       -----------------
it  will  pay  when  due  and  payable  all  documentary,  stamp and other taxes
attributable  to  the issuance or delivery of the Warrant Certificates or of the
Warrant Shares purchasable upon the exercise of Warrants; provided, however, the
                                                          --------
Company  shall  not  be  required to pay any tax or taxes that may be payable in
respect of any transfer involving the issue of any Warrant Certificate(s) or any
certificates)  for Warrant Shares in a name other than that of the Warrantholder
of  such  exercised  Warrant  Certificate  (s)

SECTION  9.3     Amendment.
                 ---------

     (a)  The  Company  may  modify this Agreement and the terms of the Warrants
only  with the consent of the Warrantholders representing at least sixty-six and
two-thirds percent (66 2/3%) of the Warrant Shares for the purpose of adding any
provision  to  or changing in any manner or eliminating any of the provisions of
this  Agreement  or  modifying  in  any  manner the rights of the holders of the
outstanding  Warrants;  provided,  however,  that  no such modification that (i)
                        --------   -------
materially  and  adversely  affects  the  exercise  rights of the holders of the
Warrants  or  (ii) reduces the percentage required for modification, may be made
without  the  consent  of  the  holder  of  all  outstanding  warrants.

     (b)  Any  such  modification  or  amendment  will be conclusive and binding
on  all  present  and future holders of Warrant Certificates whether or not they
have  consented  to  such modification or amendment or waiver and whether or not
notation  of  such  modification  or  amendment  is  made  upon  such  Warrant
Certificates.  Any  instrument  given by or on behalf of any holder of a Warrant
Certificate in connection with any consent to any modification or amendment will
be conclusive and binding on all Subsequent holders of such Warrant Certificate.

                                    Page 19
<PAGE>
     SECTION  9.4  Termination.  This  Agreement  shall terminate on or upon (a)
                   -----------
the  repurchase  by the Company of all Warrants, (b) the fifteenth day following
the  date  on which all of the Warrant Shares have been issued upon the exercise
of  all  Warrants  issued  pursuant  hereto,  or  (c)  the  Expiration  Date.

     SECTION  9.5  Reports  to  Warrantholders.  The  Company  will  cause to be
                   ---------------------------
delivered, by first-class mail, postage prepaid, facsimile or overnight courier,
to  each  Warrantholder at such Warrantholder's address appearing on the Warrant
Register,  a  copy of any reports delivered by the Company to any of the holders
of  Class  F Preferred Stock as provided in the Securities Purchase Agreement or
to  holders  of  the  Common  Stock.

     SECTION  9.6  GOVERNING  LAW.  THE  LAWS OF THE STATE OF TEXAS SHALL GOVERN
                   --------------
THIS  AGREEMENT  AND  THE  WARRANT  CERTIFICATES WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS  OF  LAW.

     SECTION  9.7  Benefits  of this Agreement.  Nothing in this Agreement shall
                   ----------------------------
be  construed  to  give to any Person other than the Company, the Warrantholders
and  the holders of Warrant Shares any legal or equitable right, remedy or claim
under this Agreement; this Agreement shall be for the sole and exclusive benefit
of  the  Company,  the  Warrantholders  and  the  holders  of  Warrant  Shares.

     SECTION 9.8  Counterparts.  This Agreement may be executed in any number of
                  ------------
counterparts,  and each of such counterparts shall for all purposes be deemed to
be  an original, and all such counterparts shall together constitute but one and
the  same  instrument.  Facsimile  transmission  of any signed original document
and/or  retransmission  of  any signed facsimile transmission will be deemed the
same as delivery of any original.  At the request of any party, the parties will
confirm  facsimile  transmission  by  signing  a  duplicate  original  document.

     SECTION  9.9  Severability  of Provisions.  Any provision of this Agreement
                   ---------------------------
that  is  prohibited  or  unenforceable  in  any  jurisdiction shall, as to such
jurisdiction,  be  ineffective  to  the  extent  of  such  prohibition  or
unenforceability  without  invalidating  the  remaining  provisions  hereof  or
affecting  the  validity  or  enforceability  of  such  provision  in  any other
jurisdiction.

                                    Page 20
<PAGE>
     SECTION 9.10  Headings.  The headings of the sections of this Agreement are
                   --------
inserted for convenience only and shall not constitute a part of this Agreement.

     SECTION  9.11  Access  to  Company  Records.  So  long  as  Warrants remain
                    ----------------------------
outstanding,  the  Investors  shall  be  entitled  to  review  the financial and
corporate  books  and  records  of  the  Company  and to meet with the executive
officers  and  independent  accountants  of  the Company for purposes reasonably
related  to  the  Investor's  ownership  of  the  Warrants,  which review and/or
meetings  shall  take place at reasonable times during the normal business hours
of  the Company and in such a manner as to not unduly interfere with the conduct
of  the  Company's  business.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                    Page 21
<PAGE>
     IN  WITNESS  WHEREOF, the parties hereto have caused this Warrant Agreement
to  be  duly  executed,  as  of  the  date  first  above  written.

                                     TELSCAPE  INTERNATIONAL,  INC.

                                     By:___________________________________
                                     Name:_________________________________
                                     Title:________________________________

                                    Page 22
<PAGE>
                                     INVESTORS:

                                     __________________________________
                                     S.  Marcus  Finkle

                                     Address:   117  AABC
                                                Aspen,  CO  81611

                                     Facsimile: (970)  920-1477

                                    Page 23
<PAGE>
                                     __________________________________
                                     Richard  Jelinek

                                     Address:    312  Ridge  Road
                                                 Aspen,  CO  81611

                                     Facsimile:  (970)  920-9171

                                    Page 24
<PAGE>

                                     _________________________________
                                     Charles  Schaller

                                     Address:    8  Bonny  Shore  Road
                                                 Spring  Island,  SC  29910

                                     Facsimile:  (843)  978-4575
                                     Phone:      (843)  987-6876

                                    Page 25
<PAGE>
                                     ________________________________
                                     William  Loflin

                                     Address:  103  Spring  Island  Drive
                                               Spring  Island,  SC  29910

                                     Facsimile: (843)  987-2025

                                    Page 26
<PAGE>
                                     _________________________________
                                     Uzi  Zucker

                                     Address:   c/o  Bear  Stearns
                                     245  Park  Avenue,  17th  Floor
                                     New  York, NY  10167

                                     Facsimile: (212)  272-9318
                                     Phone:     (212)  272-3745
                                     E-mail:     uzucker@bear.com

                                    Page 27
<PAGE>
                                     _________________________________
                                     Dwight  Lowell

                                     Address:    c/o Spring  Island Company
                                                 P.O. Box  4083
                                                 4  Duck Pen  Court
                                                 Spring Island, SC 29910

                                     Facsimile:  (843)  987-0316
                                     Phone:      (843)  987-3555
                                     E-mail:      dlowell@islc.net

                                    Page 28
<PAGE>
                                     _________________________________
                                     Jim  Chaffin

                                     Address:  c/o  Spring  Island  Company
                                               42  Mobley  Oaks  Lane
                                               Spring  Island,  SC  29910

                                     Facsimile:     (843)  987-2025

                                    Page 29
<PAGE>
                                     _________________________________
                                     Robert  S.  Price

                                     Address:   1609  Hunting  Avenue
                                                McLean,  VA  22102

                                     Facsimile:     (703)  288-3648
                                     Phone:     (703)  893-3092

                                    Page 30
<PAGE>
                                     Emicar,  LLC

                                     By:_____________________________
                                     Name:___________________________
                                     Title:__________________________

                                     Address:  2 American  Lane,  Box  2571
                                               Greenwich,  CT  06836-2571
                                     Attn:     Michele  McGovern

                                     Facsimile: (203)  861-3213
                                     Phone:     (203)  861-8401
                                     E-mail:     mmcgovern@paloma.com

                                    Page 31
<PAGE>
                                     _________________________________
                                     Selig  Zises

                                     Address:  477  Madison,  14th  Floor
                                               New  York,  NY  10022

                                     Facsimile: (212)  872-9672
                                     Phone:     (212)  872-9640
                                     E-mail:    jnielsen@avmcorp.com

                                    Page 32
<PAGE>
                                     Sound  Capital  Partners,  LLC

                                     By:_____________________________
                                     Name:___________________________
                                     Title:__________________________

                                     Address:  Motola,  Klar,  Dinowitz
                                               185 Madison Avenue, 12th Floor
                                               New  York,  NY  10016

                                     Facsimile: (212)  683-5555
                                     Phone:     (212)  699-8400

                                    Page 33
<PAGE>
                                   SCHEDULE 1

                         Investor          Number of Warrants
                         --------          ------------------

                    S. Marcus Finkle                   60,976

                    Richard Jelinek                    30,488

                    Charles Schaller                    6,097

                    William Loflin                      6,097

                    Uzi Zucker                         30,488

                    Dwight Lowell                       6,097

                    Jim Chaffin                        12,195

                    Robert Price                        3,659

                    Selig Zises                         9,146

                    Emicar, LLC                        30,488

                    Sound Capital Partners, LLC        12,195
                                                       -------

                    Total                              207,926
                                                       =======

                                    Page 34
<PAGE>
                                    EXHIBIT A
                                    ---------

                          TELSCAPE INTERNATIONAL, INC.

                          Common Stock Purchase Warrant
                                  Number _____

                Warrant Certificate Evidencing Right to Purchase

                         I      ] Shares of Common Stock

     This  is  to certify that [Investor], [a _________________], or assigns, is
entitled to purchase at any time or from time to time up to the above-referenced
number  of  shares  of Common Stock ("Common Stock"), of Telscape International,
                                      ------------
Inc.,  a  Texas  corporation  (the  "Company"),  for  the Exercise Price for the
                                     -------
Warrants  specified  in  the Amended and Restated Warrant Agreement, dated as of
_______  __, 2000, between the Company and [Investor] (the "Warrant Agreement"),
                                                            -----------------
pursuant  to which this Warrant Certificate is issued.  All rights of the holder
of  this  Warrant  Certificate  are  subject  to the terms and provisions of the
Warrant  Agreement,  copies  of which are available for inspection the Company's
office  located  at  2700  Post  Oak  Boulevard,  Suite 100, Houston, Texas (the
"Office").  The  Expiration  Date  (as  defined in the Warrant Agreement) of the
 ------
right  to  purchase  Common Stock pursuant to this Certificate is ____________,
2005.

     NEITHER  THE  WARRANTS  REPRESENTED  BY  THIS CERTIFICATE NOR THE SHARES OF
COMMON  STOCK  THAT  MAY  BE PURCHASED UPON EXERCISE HEREOF HAVE BEEN REGISTERED
UNDER  THE  SECURITIES  ACT  OF  1933,  AS  AMENDED  (THE  "ACT"),  OR UNDER ANY
                                                            ---
APPLICABLE  STATE  LAW.  SUCH  WARRANTS  AND SHARES MAY NOT BE OFFERED FOR SALE,
SOLD,  TRANSFERRED  OR  PLEDGED  WITHOUT  (1) REGISTRATION UNDER THE ACT AND ANY
APPLICABLE  STATE  LAW,  OR  (2)  THE  AVAILABILITY  OF  AN  EXEMPTION FROM SUCH
REGISTRATION.

     Subject  to  the  provisions  of  the  Act,  applicable state laws and such
Warrant  Agreement,  this  Warrant  Certificate  and  all  rights  hereunder are
transferable,  in whole or in part, at the Office by the holder hereof in person
or  by  a  duly authorized attorney, upon surrender of this Warrant Certificate,
together  with  the  assignment  hereof  duly  endorsed.  Until transfer of this
Warrant  Certificate  on  the  books  of  the Company, the Company may treat the
registered  holder  hereof  as  the  owner  hereof  for  all  purposes.

<PAGE>
     IN  WITNESS  WHEREOF, the Company has caused this Warrant Certificate to be
executed  on  this  ___  day of __________, 2000 in Houston, Texas by its proper
corporate  officers  thereunto  duly  authorized.

                                   TELSCAPE  INTERNATIONAL,  INC.
                                   a  Texas  corporation

                                    By:____________________________________
                                    Name:__________________________________
                                    Title:_________________________________

Attest:_____________________________
Name:_______________________________
Title:______________________________

<PAGE>
                                    EXHIBIT B
                                    ---------

                              Election to Purchase
                   (To be executed by the registered holder if
            such holder desires to exercise any Warrant Certificate)

     The undersigned, the registered holder of the attached Warrant Certificate,
hereby  irrevocably  elects  to  exercise  Warrants  represented by such Warrant
Certificate  and  acquire  an
aggregate  of  _____  shares  of Common Stock of Telscape International, Inc., a
Texas  corporation,  and  herewith  tenders payment for such Common Stock in the
amount  of  $_______  (by  certified check or official bank check) in accordance
with  the terms hereof.  The undersigned requests that the aforementioned Common
Stock  be  registered  in  the  name  of  whose  address  is
______________________________.

Dated:________________________

Name of registered holder of Warrant Certificate:

_________________________________________________________________
                                 (please print)

Address  of  registered
holder:______________________________________________________

Signature:________________________________________

(Note:     the  signature  to the foregoing Election must correspond to the name
as written upon the face of the Warrant Certificate in every particular, without
alteration  or  any  change  whatsoever.)

<PAGE>
                                    EXHIBIT C
                                    ---------

                              Election to Purchase
             (To be executed by the registered holder if such holder
          desires to effect cashless exercise any Warrant Certificate)

     The undersigned, the registered holder of the attached Warrant Certificate,
hereby  irrevocably  elects  to  exchange  Warrants  represented by such Warrant
Certificate  and  acquire  an
aggregate of _________ shares of Common Stock of Telscape International, Inc., a
Texas  corporation  on  ___[DATE]____.  The  undersigned  requests  that  the
aforementioned  Common  Stock  be  registered  in  the  name of whose address is
____________________________________________________________________.

Dated:_______________________________

Name of registered holder of Warrant Certificate:

________________________________________________________________________
                                 (please print)

Address  of  registered
holder:_________________________________________
Signature:______________________________________

(Note:     the  signature  to the foregoing Election must correspond to the name
as written upon the face of the Warrant Certificate in every particular, without
alteration  or  any  change  whatsoever)

<PAGE>

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