<PAGE>

                                                                    EXHIBIT 4.57

CLIFFORD                                                          CONFORMED COPY
CHANCE
PUNDER

                           MARCONI COMMUNICATIONS GMBH

                                  AS TRANSFEROR

                                       AND

                   THE LAW DEBENTURE TRUST CORPORATION p.l.c.

                                       AS

                                SECURITY TRUSTEE

                  --------------------------------------------

                           SECURITY TRANSFER AGREEMENT
                             (Sicherungsubereignung)

                 ---------------------------------------------

<PAGE>

                                    CONTENTS

<TABLE>
<CAPTION>
CLAUSE                                                                                                    PAGE
<S>                                                                                                       <C>
1.       Definitions and Languages.....................................................................      2

2.       Secured Obligations...........................................................................      3

3.       Transfer......................................................................................      3

4.       Disposal of Transferred Assets................................................................      4

5.       Retention of Title Arrangements...............................................................      5

6.       Use of Labelling of and Transfer of the Transferred Assets....................................      5

7.       Right of Inspection...........................................................................      6

8.       Bookkeeping and Data-Processing...............................................................      6

9.       Transfer of Possession of Transferred Assets to the Security Trustee..........................      7

10.      Right to Realisation upon Enforcement Event...................................................      7

11.      Limitation of Security........................................................................      8

12.      Release of Transferred Assets.................................................................      9

13.      Undertakings..................................................................................     10

14.      Expenses, Costs and Taxes.....................................................................     11

15.      Partial Invalidity, Waiver....................................................................     12

16.      Amendment, Waiver.............................................................................     12

17.      Notices and their Language....................................................................     12

18.      Applicable Law; Jurisdiction..................................................................     14

20.      Effectiveness.................................................................................     14

21.      Counterparts..................................................................................     15

Schedule 1 Marked Site Maps of Premises................................................................     16
</TABLE>

<PAGE>

THIS SECURITY TRANSFER AGREEMENT is made the 16th day of May 2003

BETWEEN:

1.       Marconi Communications GmbH, a limited liability company organised
         under the laws of the Federal Republic of Germany, having its business
         address at GerberstraBe 33, D-71522 Backnang, which is registered
         in the commercial register (Handelsregister) of the local court
         (Amtsgericht) of Backnang under HRB 1563 (the "TRANSFEROR"); and

2.       The Law Debenture Trust Corporation p.l.c., having its business address
         at Fifth Floor, 100 Wood Street, London, EC2V 7EX, England in its
         capacity as security trustee under the Relevant Documents (the
         "SECURITY TRUSTEE").

WHEREAS:

(A)      Marconi Corporation p.l.c. (the "ISSUER") has agreed to issue the
         following notes:

         (i)      USD equivalent of GBP 450,000,000 senior secured notes due
                  2008;

         (ii)     USD 300,000,000 plus USD equivalent of GBP 117,270,000 of
                  junior secured notes due 2008;

                  the notes under (i) being documented in a senior note
                  indenture dated on or about 19 May 2003 between, inter alios,
                  the Issuer and Law Debenture Trust Company of New York as
                  Senior Note Trustee and the notes under (ii) being documented
                  in a junior note indenture dated on or about 19 May 2003
                  between, inter alios, the Issuer and JPMorgan Chase Bank as
                  Junior Note Trustee (together the "INDENTURES").

(B)      The security created by or pursuant to this Agreement is to be granted
         to and administered by the Security Trustee for itself and as trustee
         of the Secured Creditors pursuant to the relevant provisions of a
         security trust and intercreditor deed dated on or about 19 May 2003
         between, inter alios, the Issuer, Law Debenture Trust Company of New
         York as Senior Note Trustee, JPMorgan Chase Bank as Junior Note
         Trustee, the Security Trustee and the Obligors (as defined therein
         including the Transferor) as amended from time to time (the "SECURITY
         TRUST AND INTERCREDITOR DEED").

(C)      The Transferor has agreed to transfer the Collateral (as defined below)
         as security for the payment and discharge of the Secured Obligations
         (as defined below) subject to the terms and conditions set out herein.

                                     - 1 -

<PAGE>

NOW, IT IS AGREED as follows:

1.       DEFINITIONS AND LANGUAGES

1.1      In this Agreement:

         "COLLATERAL" means the collateral referred to in Clause 3.1.

         "CONTINUING" in relation to an Enforcement Event, shall be construed as
         a reference to an acceleration of any Secured Obligation (other than
         Secured Obligations arising under the New Bonding Facility Agreement)
         where such acceleration has not been rescinded in writing or a
         declaration that the Secured Obligations (other than Secured
         Obligations arising under the New Bonding Facility Agreement) are
         prematurely due and payable (other than solely as a result of it
         becoming unlawful for a Secured Creditor to perform its obligations
         under the Relevant Documents) where such declaration has not been
         revoked in writing or any failure by an Obligor to pay any principal
         amount in respect of any Secured Obligations (other than Secured
         Obligations arising under the New Bonding Facility Agreement) whether
         on maturity or otherwise which has not been waived in writing. For the
         purposes of this definition of "continuing" the expression "Secured
         Obligations" shall have the same meaning as in the Security Trust and
         Intercreditor Deed.

         "SECURED OBLIGATIONS" has the meaning given to it under clause 2.

         "SECURITY TRUST AND INTERCREDITOR DEED" has the meaning given to it in
         Clause (B) of the recitals.

1.2      Unless otherwise defined herein or unless the context requires,
         capitalised terms shall have the same meaning as ascribed thereto in
         the Security Trust and Intercreditor Deed.

1.3      This Agreement is made in the English language. For the avoidance of
         doubt, the English language version of this Agreement shall prevail
         over any translation of this Agreement. However, where a German
         translation of a word or phrase appears in the text of this Agreement,
         the German translation of such word or phrase shall prevail.

1.4      The parties hereto each acknowledge that the Security Trustee, when
         acting hereunder, shall, to the extent permitted under the laws of
         Germany, be acting in accordance with and subject to the terms of the
         Security Trust and Intercreditor Deed.

                                     - 2 -

<PAGE>

2.       SECURED OBLIGATIONS

         The transfer of title hereunder (the "TRANSFER OF TITLE") is
         constituted in order to secure together with other security granted by
         the Transferor the prompt and complete satisfaction of any and all
         obligations (present and future, actual and contingent) which are (or
         are expressed to be) or become owing by the Transferor to the Secured
         Creditors or any of them (including any future assignee or transferee
         of any of the Secured Creditors by way of transfer or assignment
         (including by way of assumption of debt (Vertragsubernahme)) under the
         Relevant Documents (including, but not limited to the parallel
         obligations of the Transferor pursuant to clause 3 of the Security
         Trust and Intercreditor Deed to pay to the Security Trustee sums equal
         to the sums owed by the Transferor to the Secured Creditors or any of
         them) (the "SECURED OBLIGATIONS") up to an aggregate amount of EUR 170
         million.

3.       TRANSFER

3.1      The Transferor hereby transfers by way of security to the Security
         Trustee in its capacity as Security Trustee for the benefit of the
         Secured Creditors title to all current assets (Umlaufvermogen)
         (including, but not limited to the entire stock (Warenbestand)) and all
         fixed assets (Anlagevermogen) (including, without limitation,
         machinery, computers and inventory) other than those assets which are
         marked as a third party's property, which are located at the premises
         marked in green colour on the enclosed site maps of Schedule 1 which
         form an integral part of this Agreement (the "PREMISES") (the "PRESENT
         COLLATERAL") or which will be located at the Premises from time to time
         in the future (the "FUTURE COLLATERAL", and together with the Present
         Collateral the "COLLATERAL").

3.2      Title to the Present Collateral shall pass over to the Security Trustee
         upon execution of this Agreement. Title to the Future Collateral shall
         pass over to the Security Trustee when it is deposited on the Premises.

3.3      To the extent that the Transferor has only part ownership (Miteigentum)
         of the Collateral or the Transferor has any inchoate rights
         (Anwartschaftsrechte) in respect of the Collateral, the Transferor
         hereby transfers to the Security Trustee such part ownership or
         inchoate rights in respect of the Collateral and it is agreed that the
         transfer of part ownership or inchoate rights in respect of the
         Collateral takes place on the date hereof or on the date the Transferor
         acquires part ownership or inchoate rights in respect of such
         Collateral (together with the Collateral referred to as the
         "TRANSFERRED ASSETS").

3.4      The Transferor and the Security Trustee agree that the Transfer of
         Title to the Security Trustee shall not be affected by the Transferor
         relocating any of the Transferred Assets to premises other than the
         Premises. The Transferor undertakes to the Security Trustee that it
         shall upon such relocation at any time

                                     - 3 -

<PAGE>

         after the occurrence of an Insolvency Event of Default or upon request
         by the Security Trustee if the Security Trustee has been so instructed
         pursuant to the Security Trust and Intercreditor Deed upon or at any
         time after the occurrence of an Event of Default which is continuing,
         immediately deliver to the Security Trustee (i) a list setting out the
         respective Transferred Assets, other than those removed for the purpose
         of disposals as permitted by the Indentures, and the respective
         addresses of the locations to where these Transferred Assets have been
         relocated, or (ii) in case of a transfer of the whole or a part of the
         business to a new location, a marked site map of the new location. Upon
         delivery of a marked site map the relevant locations indicated on that
         marked site map shall be considered as Premises.

3.5      Delivery of possession of the Transferred Assets to the Security
         Trustee is hereby replaced by the agreement that the Transferor holds
         the Transferred Assets in gratuitous custody (kostenlose Verwahrung)
         for the Security Trustee. The Transferor hereby further assigns all
         present and future claims against third parties obtaining actual
         possession of the Transferred Assets to the Security Trustee, who
         accepts such assignment.

3.6      The Security Trustee hereby accepts the transfer constituted hereby.

4.       DISPOSAL OF TRANSFERRED ASSETS

4.1      So long as the Security Trustee has not revoked the ability of the
         Transferor to dispose of the Transferred Assets pursuant to Clause 9,
         the Transferor may dispose of or otherwise deal with the Transferred
         Assets except as expressly prohibited under the terms of the
         Indentures.

4.2      Except during the continuance of an Enforcement Event, the Transferor
         may use the Transferred Assets in its production process, provided that
         the Security Trustee shall be regarded as producer (Hersteller) within
         the meaning of Section 950 of the German Civil Code and shall during
         such production process remain or become owner, part-owner or have an
         inchoate right (Anwartschaftsrecht) in respect of goods which are the
         result of such production process (such goods being hereinafter
         referred to as "NEW PRODUCTS").

4.3      If as a result of any production process carried on by the Transferor
         (whether or not by incorporation of the Transferred Assets into a New
         Product (Vermischung, Vermengung)) the Transferor is no longer owner,
         part-owner or holder of an inchoate right (Anwartschaftsrecht) of the
         New Product, then as soon as the Transferor regains such rights, such
         rights shall automatically be transferred to the Security Trustee. If
         as a result of any production process carried on by the Transferor the
         Transferor co-mingles goods or materials owned by it with goods or
         materials owned by third parties and the Transferor thereby

                                     - 4 -

<PAGE>

         becomes part-owner or holder of any inchoate right of the resulting New
         Product (Anwartschaftsrecht), then, as soon as the Transferor gains
         such rights such rights shall automatically be transferred to the
         Security Trustee.

4.4      To the extent that the Transferor has the right to demand transfer of
         ownership, part-ownership or inchoate rights (Anwartschaftsrecht), the
         Transferor assigns such rights hereby to the Security Trustee who
         accepts such assignment.

4.5      In as far as ownership, part-ownership or any inchoate rights
         (Anwartschaftsrecht) in the New Products passes to the Security
         Trustee, the transfer of possession in such New Products will be
         substituted by the Transferor holding them in gratuitous custody
         (kostenlose Verwahrung) for the Security Trustee.

4.6      If any third party is in, or acquires, possession of any New Product,
         the Transferor hereby assigns to the Security Trustee its present and
         future claims to demand restitution from such third party and the
         Security Trustee accepts such assignment.

4.7      The Transferor hereby also assigns to the Security Trustee all present
         or future claims it may have against a third party in respect of the
         production process of the Transferred Assets or the New Product
         resulting therefrom and the Security Trustee accepts such assignment.

5.       RETENTION OF TITLE ARRANGEMENTS

         The Transferor shall where appropriate in the ordinary course of
         business terminate any person's retention of title arrangements
         (Eigentumsvorbehalt) in respect of any Transferred Assets by paying the
         purchase price thereof. Upon the occurrence of an Enforcement Event,
         the Security Trustee shall be entitled to terminate such retention of
         title arrangements by paying the purchase price thereof or part thereof
         on behalf of the Transferor.

6.       USE OF LABELLING OF AND TRANSFER OF THE TRANSFERRED ASSETS

6.1      At any time after the occurrence of an Enforcement Event the Transferor
         shall at its cost keep the Transferred Assets in good order at its
         Premises and the Security Trustee shall be entitled to, or request the
         Transferor to, label the goods and mark them in the books and records
         of the Transferor to show that the goods have been transferred for
         security purposes to the Security Trustee.

6.2      Subject to Clause 4 and Clause 3.4, the Transferor shall not, without
         the prior written consent of the Security Trustee, transfer the
         Transferred Assets except for inventory to any premises other than the
         Premises.

                                     - 5 -

<PAGE>

7.       RIGHT OF INSPECTION

7.1      The Transferor undertakes to provide the Security Trustee, promptly at
         its request with all information and documents which are necessary for
         perfecting and/or enforcing the security hereby created.

7.2      The Transferor authorises the Security Trustee during the term of this
         Agreement and upon notice to inspect the Transferred Assets during
         normal business hours, or to have them inspected by any one or more
         representatives, agents and advisers of the Security Trustee. Following
         the occurrence of an Event of Default, the Security Trustee may inspect
         the Transferred Assets at any time with or without prior notice.

7.3      To the extent the Transferred Assets are in the possession of a third
         party, the Transferor shall, following an Insolvency Event of Default
         or upon request by the Security Trustee if the Security Trustee has
         been so instructed pursuant to the Security Trust and Intercreditor
         Deed upon or at any time after the occurrence of an Event of Default
         which is continuing instruct such third party to allow inspection by
         the Security Trustee of the Transferred Assets at such third party's
         premises.

8.       BOOKKEEPING AND DATA-PROCESSING

8.1      If proof or documents which are necessary to identify the Collateral
         have been handed over by the Transferor to a third party (in particular
         a bookkeeping firm, or a tax consultant) the Transferor hereby
         transfers (on condition of (aufschiebende Bedingung) (i) the occurrence
         of an Insolvency Event of Default or (ii) notice by the Security
         Trustee if the Security Trustee has been so instructed pursuant to the
         Security Trust and Intercreditor Deed upon or at any time after the
         occurrence of an Event of Default which is continuing) to the Security
         Trustee, who accepts this transfer, its right to demand from such third
         party the return of the proof and documents. The Transferor hereby
         undertakes to instruct the third party upon such transfer to provide
         the Security Trustee upon its demand with such information and
         documents which are necessary to perfect and/or enforce the security
         created hereby.

8.2      If details concerning the Collateral or any part thereof have been
         stored in an electronic data-processing system, then, upon the
         occurrence of an Insolvency Event of Default or upon request by the
         Security Trustee if the Security Trustee has been so instructed
         pursuant to the Security Trust and Intercreditor Deed upon or at any
         time after the occurrence of an Event of Default which is continuing,
         the Transferor shall allow the Security Trustee access to the computer,
         including the peripheral equipment and all data concerning the
         Collateral or such part thereof. Moreover, software operators shall be
         made available insofar as so required, and any assistance required
         shall be provided to

                                     - 6 -

<PAGE>

         the Security Trustee. If a third party handles the electronic
         processing of data, the Transferor hereby transfers (on condition of
         (aufschiebende Bedingung) (i) the occurrence of an Insolvency Event of
         Default or (ii) notice by the Security Trustee if the Security Trustee
         has been so instructed pursuant to the Security Trust and Intercreditor
         Deed upon or at any time after the occurrence of an Event of Default
         which is continuing) to the Security Trustee, who accepts this
         transfer, all rights against such third party relating to these
         services. The Transferor hereby undertakes to instruct the third party
         upon such transfer to handle the processing of data for the Security
         Trustee upon its demand as it did for the Transferor.

8.3      After transfer of the rights to the Security Trustee as contemplated in
         Clauses 8.1 and 8.2, the Security Trustee shall promptly upon request
         of the Transferor or after the Security Trustee receiving instructions
         pursuant to the Security Trust and Intercreditor Deed instruct the
         third party to provide the Transferor with such services and
         information as necessary for the Transferor in connection with the
         preparation and delivery of the Auditors' Determination.

9.       TRANSFER OF POSSESSION OF TRANSFERRED ASSETS TO THE SECURITY TRUSTEE

         The Security Trustee may, upon the occurrence of an Insolvency Event of
         Default and shall, if so instructed pursuant to the Security Trust and
         Intercreditor Deed upon or at any time after the occurrence of any
         Event of Default which is continuing, revoke the right of the
         Transferor to dispose of the Transferred Assets permitted pursuant to
         Clause 4 of this Agreement and the Security Trustee may, and shall, if
         so instructed pursuant to the Security Trust and Intercreditor Deed,
         request a transfer of possession of the Transferred Assets to it.

10.      RIGHT TO REALISATION UPON ENFORCEMENT EVENT

10.1     At any time after the occurrence of an Enforcement Event which is
         continuing and the Security Trustee (acting or instructions received
         pursuant to the Security Trustee and Intercreditor Deed) giving notice
         to the Issuer thereof and if any of the Secured Obligations became due
         and payable, the Security Trustee shall, in its discretion, be entitled
         to enforce this Agreement and realise the Transferred Assets for and on
         behalf of the Secured Creditors in accordance with the provisions of
         this Clause 10.

10.2     The Security Trustee may sell all or part of the Transferred Assets by
         way of private sale to the extent necessary to satisfy any outstanding
         Secured Obligations, it being understood that the Security Trustee
         shall apply the

                                     - 7 -

<PAGE>

         proceeds of such realisation towards the Secured Obligations in
         accordance with and subject to the terms of the Security Trust and
         Intercreditor Deed.

10.3     The Security Trustee may request the Transferor to sell the Transferred
         Assets for and on its behalf and the Transferor shall promptly comply
         with such request.

10.4     In the case of a sale by the Security Trustee, the Transferor shall
         promptly upon the request of the Security Trustee provide the Security
         Trustee with all documents of title and other documents relating to the
         Transferred Assets.

10.5     If the Security Trustee sells the Transferred Assets pursuant to this
         Clause 10 it may take all measures and enter into all agreements which
         it considers to be expedient in connection therewith.

10.6     With respect to the realisation of the Transferred Assets, the Security
         Trustee will take into consideration the legitimate interest of the
         Transferor.

10.7     The Security Trustee will notify the Transferor in writing at least
         five (5) Business Days prior to the sale of the Transferred Assets. No
         such notification shall be required if (i) the Transferor has generally
         ceased to make payments, (ii) an application for the institution of
         insolvency proceedings is filed by or against the Transferor or (iii)
         there is reason to believe that observance of the notice period will
         affect the security interest of the Security Trustee in material
         adverse way.

11.      LIMITATION OF SECURITY

11.1     The right to enforce the security interests created hereunder shall, to
         the extent that the Secured Obligations represent those of an
         affiliated company (verbundenes Unternehmen) within the meaning of
         Section 15 et seq. of the German Stock Corporation Act (Aktiengesetz)
         of the Transferor (other than any of the Transferor's subsidiaries), at
         all times be limited to an amount equal to the Transferor's assets (the
         calculation of which shall take into account the captions reflected in
         Section 266 sub-section (2) A, B and C of the German Commercial Code
         (Handelsgesetzbuch)) less the sum of (A) the Transferor's liabilities
         (the calculation of which shall take into account the captions
         reflected in Section 266 subsection (3) B, C and D of the German
         Commercial Code), and (B) the stated share capital (Stammkapital) of
         the Transferor (the "NET ASSETS").

11.2     The Transferor shall realise, to the extent legally permitted and, in
         respect of the Transferor, commercially justifiable, in a situation
         where the Transferor does not have sufficient Net Assets to maintain
         its registered share capital, any and all of its assets that are shown
         in the balance sheet with a book value (Buchwert) that

                                     - 8 -

<PAGE>

         is significantly lower than the market value of the assets if the asset
         is not necessary for the Transferor's business (betriebsnotwendig).

11.3     The Security Trustee shall enforce any security interest created
         hereunder against the Transferor in accordance with the following
         procedure:

                  (i)      The Transferor shall, following a notification by the
                           Security Trustee to the Transferor that an
                           Enforcement Event has occurred and that the Security
                           Trustee intends to enforce the security interests
                           created hereunder, deliver to the Security Trustee
                           within sixty days of such notification an auditors'
                           determination from a firm of auditors of
                           international standard and reputation (the "AUDITORS'
                           DETERMINATION") stating the value of the Net Assets,
                           i.e., the amounts which may be claimed against the
                           Transferor under the security interests created
                           hereunder having regard to Sections 30 and 31 of the
                           German Limited Liability Companies Act.

                  (ii)     The Auditors' Determination, i.e., the amount which
                           may be claimed against the Transferor under the
                           security interests created hereunder, having regard
                           to Section 30 and 31 of the German Limited Liability
                           Companies Act, shall take into account the generally
                           accepted accounting principles applicable from time
                           to time in Germany (GAAP) and be based on the same
                           principles that were applied when establishing the
                           previous year's balance sheet.

                  (iii)    The amount specified in the relevant Auditors'
                           Determination pertaining to the Transferor shall be
                           up-to-date and in any event such Auditors'
                           Determination shall have been prepared as of a date
                           no earlier than 15 business days prior to the date of
                           notification by the Security Trustee to the
                           Transferor that it intends to enforce the security
                           interests created hereunder.

                  (iv)     If the Transferor fails to deliver the Auditors'
                           Determination to the Security Trustee within the
                           sixty day period stated in (i) above, the Security
                           Trustee shall be entitled to enforce the security
                           interests created hereunder against the Transferor
                           without limitation.

12.      RELEASE OF TRANSFERRED ASSETS

12.1     To the extent the parties to this Agreement become aware that the
         Transferor has transferred to the Security Trustee title to assets
         owned by a third party prior to such transfer, the Security Trustee
         shall retransfer title to these assets to such

                                     - 9 -

<PAGE>

         third party. Any records of the Transferor about third parties'
         property shall constitute a prima facie evidence of such third party's
         title to such assets. The Security Trustee hereby authorises the
         Transferor to retransfer title to such assets to the relevant third
         party.

12.2     Upon complete and irrevocable satisfaction of the Secured Obligations,
         the Security Trustee shall (in accordance with the terms and subject to
         the conditions and circumstances set out in the Security Trust and
         Intercreditor Deed and without recourse to, or any representation or
         warranty by, the Security Trustee or any of its nominees) at the cost
         and expense of the Transferor retransfer the Transferred Assets and all
         other rights and claims assigned or transferred to it pursuant to this
         Agreement to the Transferor and surrender the excess proceeds, if any,
         resulting from any sale of the Transferred Assets. The Security Trustee
         will, however, transfer any of the Transferred Assets to a third person
         if so required by law.

12.3     At any time when the total value of the aggregate security granted by
         the Transferor to secure the Secured Obligations (the "SECURITY") which
         can be expected to be realised in the event of an enforcement of the
         Security (realisierbarer Wert) exceeds 110% of the Secured Obligations
         (the "LIMIT") not only temporarily, the Security Trustee shall (in
         accordance with the terms and subject to the conditions and
         circumstances set out in the Security Trust and Intercreditor Deed and
         without recourse to, or any representation or warranty by, the Security
         Trustee or any of its nominees) on demand of the Transferor release
         such part of the Security (Sicherheitenfreigabe) as the Security
         Trustee may in its discretion determine so as to reduce the realisable
         value of the Security to the Limit.

13.      UNDERTAKINGS

13.1     As far as necessary for the creation, perfection or maintenance of the
         Security over the Transferred Assets the Transferor undertakes to
         inform the Security Trustee promptly of any attachments (Pfandung) of
         which it becomes aware in respect of any and all of the Transferred
         Assets. In the event of an attachment, the Transferor undertakes to
         forward to the Security Trustee upon request a copy of the attachment
         order (Pfandungsbeschlu(beta)), the garnishee order
         (Uberweisungsbeschlu(beta)) and all other documents necessary for a
         defence against the attachment. The Transferor shall inform the
         attaching creditor immediately about the Security Trustee's security
         interests.

13.2     Insofar as additional documents, declarations or actions (including
         making all filings and registrations) are necessary for the creation,
         perfection, protection or maintenance of the security interests created
         (or purported to be created) hereunder (or any of them) in favour of
         the Security Trustee or for the exercise

                                     - 10 -

<PAGE>

         of all rights, powers and remedies of the Security Trustee provided by
         or pursuant to this Agreement or by law or to facilitate the
         realisation of the security interests created (or purported to be
         created) hereunder (or any of them), the Transferor shall at the
         Security Trustee's request enter into or provide such documents, make
         such declarations and/or undertake such actions at the Transferor's
         cost and expense.

14.      EXPENSES, COSTS AND TAXES

14.1     EXPENSES

         The Transferor shall, from time to time and promptly on demand by the
         Security Trustee reimburse to the Security Trustee all costs and
         expenses (including legal fees) on a full indemnity basis together with
         any applicable VAT incurred by the Security Trustee and any Delegate
         (provided that in relation to sub-clause (i) of this Clause 14, such
         costs and expenses must be properly incurred) in connection with:

                  (i)      the execution, release and discharge of this
                           Agreement and the security created or intended to be
                           created in respect of the Transferred Assets and the
                           perfection of the security contemplated in this
                           Agreement or in any such documents or forming part of
                           the security created or intended to be created in
                           respect of the Transferred Assets;

                  (ii)     the actual or contemplated exercise, preservation
                           and/or enforcement of any of the rights, powers and
                           remedies of, or the performance of the duties and
                           obligations of, the Security Trustee or any Delegate,
                           or any amendment or waiver in respect of this
                           Agreement;

                  (iii)    the foreclosure of any Transferred Assets; and

                  (iv)     the preservation and/or enforcement of the security
                           created or intended to be created in respect of the
                           Transferred Assets,

                  which shall carry interest (before and after any judgment and
                  to the extent interest at a default rate is not otherwise
                  being paid on such sum) from the date of such demand until so
                  reimbursed calculated on a daily basis at the rate determined
                  in accordance with the provisions of clause 18.4 (Interest on
                  Demands) of the Security Trust and Intercreditor Deed.

14.2     TAXES

         The Transferor shall pay, promptly on demand of the Security Trustee
         all stamp, registration, notarial and other similar Taxes or fees paid
         or payable by the

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         Security Trustee in connection with any action taken or contemplated by
         or on behalf of the Security Trustee for perfecting, enforcing,
         releasing, cancelling, reassigning or resolving any doubt concerning,
         or for any other purpose in relation to this Agreement, any amendment
         thereto, any transfer and/or assignment of the rights and/or
         obligations under the same or the security created or intended to be
         created in respect of the Transferred Assets and shall, from time to
         time, indemnify the Security Trustee promptly on demand against any
         liabilities, costs, claims and expenses resulting from any failure to
         pay by the Transferor or any delay by the Transferor in paying any such
         Taxes or fees.

15.      PARTIAL INVALIDITY, WAIVER

15.1     If at any time, any one or more of the provisions hereof is or becomes
         invalid, illegal or unenforceable in any respect under the law of any
         jurisdiction, that provision shall as to that jurisdiction, be
         ineffective to the extent necessary without affecting or impairing the
         validity, legality and enforceability of the remaining provisions of
         this Agreement or of such provisions in any other jurisdiction. The
         invalid or unenforceable provision shall be deemed replaced by a valid,
         legal and enforceable provision which comes as close as possible to the
         orginal intent of the parties as to the invalid, illegal or
         unenforceable provision. This shall apply analogously in the case of
         gaps.

15.2     No failure to exercise, nor any delay in exercising, on the part of the
         Security Trustee, any right or remedy hereunder shall operate as a
         waiver thereof, nor shall any single or partial exercise of any right
         or remedy prevent any further or other exercise thereof or the exercise
         of any other right or remedy. The rights and remedies provided
         hereunder are cumulative and not exclusive of any rights or remedies
         provided by law.

16.      AMENDMENT, WAIVER

         This Agreement may be amended, modified or waived only in writing in an
         agreement signed by the Security Trustee. This also applies to this
         Clause 16.

17.      NOTICES AND THEIR LANGUAGE

17.1     Each communication under or in connection with this Agreement shall be
         made in writing and, unless otherwise stated, may be made by fax or
         letter.

17.2     Any communication or document to be made or delivered under or in
         connection with this Agreement shall be made or delivered to the
         following addresses or fax numbers (and for the attention of the
         department or officer noted):

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<PAGE>

         For the Transferor:          Marconi Communications GmbH
                                      Address:      GerberstraBe 33

                                                    D-71522 Backnang

                                      Fax:          07191 13 2419
                                      Attention:    Hans-Werner Altermann
                                                    Legal Advisor

         For the Security Trustee:    The Law Debenture Trust Corporation p.l.c.
                                      Address:      Fifth Floor
                                                    100 Wood Street
                                                    London EC2V 7EX
                                                    England

                                      Fax:          +44 20 7696 5261
                                      Attention:    Manager Trust Adminstration

         or to such other address as the recipient may notify or may have
         notified to the other party in writing.

17.3     DELIVERY

17.3.1   Any communication or document made or delivered by one person to
         another under or in connection with this Agreement will only be
         effective:

         (a)      if by way of fax, when received in legible form; or

         (b)      if by way of letter, when it has been left at the address
                  specified in Clause 17.2 above or five Business Days after
                  being deposited in the post postage prepaid in an envelope
                  addressed to the addressee at that address,

         and, if a particular department or officer is specified as part of that
         address, if addressed to that department or officer.

17.3.2   Notwithstanding the provisions of sub-clause 17.3.1 (b) above, any
         communication or document to be made or delivered to the Security
         Trustee will be effective only when actually received by the Security
         Trustee and then only if it is expressly marked for the attention of
         the department or officer identified in Clause 17.2 (or any substitute
         department or officer as such person shall specify for this purpose).

17.4     Any notice given under or in connection with this Agreement shall be in
         the English language. All other documents provided under or in
         connection with this Agreement (other than those copies to be delivered
         pursuant to Clause 13) shall be in the English language or, if in any
         other language, accompanied by a

                                     - 13 -

<PAGE>

         translation into English which if reasonably requested by the Security
         Trustee shall be a certified translation. In the event of any conflict
         between the English text and the text in any other language, the
         English text shall prevail, unless the document is a constitutional,
         statutory or other official document.

18.      APPLICABLE LAW; JURISDICTION

18.1     APPLICABLE LAW

         This Agreement shall be governed by and construed in accordance with
         the laws of the Federal Republic of Germany.

18.2     GERMAN COURTS

         The courts of Frankfurt am Main have exclusive jurisdiction to settle
         any dispute (a "DISPUTE") arising out of or in connection with this
         Agreement (including a dispute regarding the existence, validity or
         termination of this Agreement or the consequences of its nullity).

18.3     CONVENIENT FORUM

         The parties agree that the courts of Frankfurt am Main are the most
         appropriate and convenient courts to settle Disputes between them and,
         accordingly, that they will not argue to the contrary.

18.4     NON-EXCLUSIVE JURISDICTION

         This Clause 18 is for the benefit of the Secured Creditors only. As a
         result it does not prevent any Secured Creditor from taking proceedings
         relating to a Dispute ("PROCEEDINGS") in any other courts with
         jurisdiction. To the extent allowed by law, the Secured Creditors may
         take concurrent Proceedings in any number of jurisdictions.

19.      ASSIGNMENT

         The Security Trustee may assign and transfer all or any of its rights
         and obligations under this Agreement in accordance with the Security
         Trust and Intercreditor Deed. To the extent legally permissible the
         Security Trustee shall be entitled to disclose such information
         concerning the Transferor and this Agreement as the Security Trustee
         considers appropriate to any actual or proposed direct or indirect
         successor or to any person to whom information may be required to be
         disclosed by any applicable law.

20.      EFFECTIVENESS

         This Agreement shall become effective only subject to the condition
         precedent and at the time of the first original issuance of the Senior
         Notes.

                                     - 14 -

<PAGE>

21.      COUNTERPARTS

         This Agreement may be executed in any number of counterparts and by
         different parties hereto on separate counterparts each of which, when
         executed and delivered, shall constitute an original, but all the
         counterparts shall together constitute but one and the same instrument.

                                     - 15 -

<PAGE>

                                   SCHEDULE 1

                          MARKED SITE MAPS OF PREMISES

                                     - 16 -

<PAGE>

                                 SIGNATURE PAGE

THIS SECURITY TRANSFER AGREEMENT HAS BEEN ENTERED INTO ON THE DATE STATED AT THE
BEGINNING BY:

MARCONI COMMUNICATIONS GmbH

By: MARY SKELLY
    Name:  Mary Skelly
    Title: Attorney

THE LAW DEBENTURE TRUST CORPORATION p.l.c.

By: R. D. RANCE
    Name:  R. D. Rance
    Title: Director

                                     - 17 -