ATTACHMENT I
                                                                    ------------




                           CERTIFICATE OF DESIGNATION
                       OF THE VOTING POWERS, DESIGNATION,
                    PREFERENCES AND RELATIVE, PARTICIPATING,
              OPTIONAL OR OTHER SPECIAL RIGHTS AND QUALIFICATIONS,
                       LIMITATIONS AND RESTRICTIONS OF THE
                   5% CUMULATIVE PREFERRED STOCK, SERIES A, OF
                                NTL INCORPORATED

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


                        PURSUANT TO SECTION 151(g) OF THE
                GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

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



         The undersigned, Executive Vice President, General Counsel and
Secretary of NTL Incorporated, a Delaware corporation (the "Corporation"),
HEREBY CERTIFIES that the Board of Directors, in accordance with Article FOURTH,
Section B of the Corporation's Restated Certificate of Incorporation and Section
151(g) of the Delaware General Corporation Law (the "DGCL"), has authorized the
creation of the series of Preferred Stock hereinafter provided for and has
established the dividend, redemption and voting rights thereof and has adopted
the following resolution, creating the following new series of the Corporation's
Preferred Stock:

         "BE IT RESOLVED that, pursuant to authority expressly granted to the
Board of Directors by the provisions of Article FOURTH, Section B of the
Restated Certificate of Incorporation of the Corporation and Section 151(g) of
the DGCL, there is hereby created and authorized the issuance of a new series of
the Corporation's Preferred Stock, par value $0.01 per share ("Preferred
Stock"), with the following powers, designations, dividend rights, voting
powers, rights on liquidation, redemption rights and other preferences and
relative, participating, optional or other special rights and with the
qualifications, limitations or restrictions on the shares of such series (in
addition to the powers, designations, preferences and relative, participating,
optional or other special rights and the qualifications, limitations or
restrictions thereof set forth in the Restated Certificate of Incorporation that
are applicable to each series of Preferred Stock) hereinafter set forth.




<PAGE>



         (1) Number and Designation. 1,850,000 shares of the Preferred Stock of
the Corporation shall be designated as 5% Cumulative Preferred Stock, Series A
(the "5% Preferred Stock"), and no other shares of Preferred Stock shall be
designated as 5% Preferred Stock.

         (2) Definitions. For purposes of the 5% Preferred Stock, the following
terms shall have the meanings indicated:

         "Bankruptcy Event" shall mean any of the following: (i) a court having
jurisdiction in the premises enters a decree or order for (A) relief in respect
of any Major Entity in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereinafter in effect, (B) appointment of
a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of any Major Entity or for all or substantially all of the property and
assets of any Major Entity or (C) the winding up or liquidation of the affairs
of any Major Entity; or (ii) any Major Entity (A) commences a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereinafter in effect, or consents to the entry of an order for relief in an
involuntary case under any such law, (B) consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of any Major Entity, or for all or
substantially all of the property and assets of any Major Entity or (C) effects
any general assignment for the benefit of creditors.

         "Board of Directors" shall mean the board of directors of the
Corporation. "Board of Directors" shall also mean the Executive Committee, if
any, of such board of directors or any other committee duly authorized by such
board of directors to perform any of its responsibilities with respect to the 5%
Preferred Stock.

         "Business Day" shall mean any day other than a Saturday, Sunday or a
day on which state or federally chartered banking institutions in New York, New
York are not required to be open.

         "Common Stock" shall mean the Corporation's Common Stock, par value
$0.01 per share.

         "Constituent Person" shall have the meaning set forth in paragraph
(9)(e) hereof.


                                       2

<PAGE>



         "Conversion Rate" shall have the meaning set forth in paragraph (9)(a)
hereof.

         "Corporation" shall have the meaning set forth in the preamble.

         "Current Market Price" of publicly traded shares of Common Stock or any
other class of capital stock or other security of the Corporation or any other
issuer for any day shall mean the last reported sale price for such security on
the principal exchange or quotation system on which such security is listed or
traded. If the security is not admitted for trading on any national securities
exchange or the Nasdaq National Market, "Current Market Price" shall mean the
average of the last reported closing bid and asked prices reported by the Nasdaq
as furnished by any member in good standing of the National Association of
Securities Dealers, Inc., selected from time to time by the Corporation for that
purpose or as quoted by the National Quotation Bureau Incorporated. In the event
that no such quotation is available for such day, the Current Market Price shall
be the average of the quotations for the last five Trading Days for which a
quotation is available within the last 30 Trading Days prior to such day. In the
event that five such quotations are not available within such 30-Trading Day
period, the Board of Directors shall be entitled to determine the Current Market
Price on the basis of such quotations as it reasonably considers appropriate.

         "Determination Date" shall have the meaning set forth in paragraph
(9)(a) hereof.

         "Dividend Payment Date" shall mean the applicable redemption date of
the 5% Preferred Stock as set forth in paragraph 6(a).

         "Dividend Periods" shall mean quarterly dividend periods commencing on
March 31, June 30, September 30 and December 31 of each year and ending on and
including the day preceding the first day of the next succeeding Dividend Period
(except that the initial Dividend Period shall commence on the Issue Date and
the final Dividend Period shall end on but exclude the Dividend Payment Date.

         "Eurotel" shall mean an entity which is or will be a direct or
indirect, wholly-owned subsidiary of the Corporation, which entity owns all of
the outstanding capital stock of entities that are primarily engaged in the
broadband communications, broadcasting and cable television business in
Continental Europe (outside of France).


                                       3

<PAGE>



         "Eurotel Stock" shall mean capital stock of Eurotel with the greatest
voting power and the power to control or direct the management of Eurotel of the
type and class held, directly or through any of its subsidiaries, by the
Corporation.

         "Exchange Act"" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulation thereunder.

         "Exchange Date" shall have the meaning set forth in paragraph (9)(a)
hereof.

         "Expiration Time" shall have the meaning set forth in paragraph
(9)(d)(v) hereof.

         "5% Preferred Stock" shall have the meaning set forth in paragraph (1)
hereof.

         "5% Convertible Preferred" shall have the meaning set forth in
paragraph (3)(d) hereof.

         "5% Convertible Series A" shall have the meaning set forth in paragraph
(3)(d) hereof.

         "5% Convertible Series B" shall have the meaning set forth in paragraph
(3)(d) hereof.

         "5 1/4% Preferred" shall have the meaning set forth in paragraph (3)(d)
hereof.1

         "5 1/4% Series A" shall have the meaning set forth in paragraph (3)(d)
hereof.

         "GAAP" shall mean United States generally accepted accounting
principles and practices as in effect from time to time and applied consistently
throughout the periods involved.

         "Holdco" shall have the meaning set forth in paragraph (11) hereof.

--------
1        Called for redemption on February 7, 2000. As soon as appropriate
         certificates of elimination are filed, this Certificate of Designation
         will be amended to eliminate references.



                                       4
<PAGE>



         "Issue Date" shall mean the date on which shares of 5% Preferred Stock
are first issued.

         "Investment Agreement" means the agreement, dated July 26, 1999,
between France Telecom and the Corporation.

         "Junior Securities" shall have the meaning set forth in paragraph
(3)(c) hereof.

         "Junior Securities Distribution" shall have the meaning set forth in
paragraph (4)(e) hereof.

         "Liquidation Right" shall mean, for each share of 5% Preferred Stock,
an amount equal to US$1,000 per share, plus an amount equal to all dividends
(whether or not earned or declared) accrued and unpaid thereon to the date of
final distribution to such holders.

         "Major Entity" shall mean any of the Corporation, NTL Communications
Corp., Diamond Cable Communications Limited, Diamond Holdings Limited, NTL
(Triangle) LLC or any Significant Subsidiary.

         "Nasdaq" means the Nasdaq Stock Market, Inc., the electronic securities
market regulated by the National Association of Securities Dealers, Inc.

         "Nasdaq National Market" shall have the meaning set forth in Rule
4200(a)(23) of the rules of the National Association of Securities Dealers, Inc.

         "9.9% Series B Preferred" shall have the meaning set forth in paragraph
(3)(d) hereof.

         "NYSE" means the New York Stock Exchange.

         "outstanding", when used with reference to shares of stock, shall mean
issued shares, excluding shares held by the Corporation or a subsidiary.

         "Parity Securities" shall have the meaning set forth in paragraph
(3)(b) hereof.


                                       5

<PAGE>



         "Person" shall mean any individual, partnership, association, joint
venture, corporation, business, trust, joint stock company, limited liability
company, any unincorporated organization, any other entity, a "group" of such
persons, as that term is defined in Rule 13d-5(b) under the Exchange Act, or a
government or political subdivision thereof.

         "Preferred Stock" shall have the meaning set forth in the first
resolution above.

         "Purchase Agreement" shall mean the Purchase Agreement, dated February
17, 2000, among the Corporation and certain parties identified therein with
respect to the 5% Preferred Stock.

         "Purchase Shares" shall have the meaning set forth in (9)(d)(v) hereof.

         "Qualified Holder" shall mean any holder other than a commercial bank
or an affiliate of a commercial bank.

         "Record Date" shall have the meaning set forth in paragraph (9)(d)(iv)
hereof.

         "Redemption Date" shall have the meaning set forth in paragraph (6)(a)
hereof.

         "Redemption Obligation" shall have the meaning set forth in paragraph
(6)(b) hereof.

         "Redemption Price" shall have the meaning set forth in paragraph (6)(a)
hereof.

         "Senior Securities" shall have the meaning set forth in paragraph
(3)(a) hereof.

         "set apart for payment" shall be deemed to include, without any action
other than the following, the recording by the Corporation in its accounting
ledgers of any accounting or bookkeeping entry which indicates, pursuant to a
declaration of dividends or other distribution by the Board of Directors, the
allocation of funds to be so paid on any series or class of capital stock of the
Corporation; provided, however, that if any funds for any class or series of
Junior Securities or any class or series of Parity Securities are placed in a
separate account of the Corporation or


                                       6

<PAGE>



delivered to a disbursing, paying or other similar agent, then "set apart for
payment" with respect to the 5% Preferred Stock shall mean placing such funds in
a separate account or delivering such funds to a disbursing, paying or other
similar agent, as the case may be.

         "Significant Subsidiary" shall have the meaning given to such term in
Regulation S-X under the Exchange Act.

         "13% Preferred" shall have the meaning set forth in paragraph (3)(d)
hereof.

         "Trading Day" shall mean any day on which the securities in question
are traded on the NYSE, or if such securities are not listed or admitted for
trading on the NYSE, on the principal national securities exchange on which such
securities are listed or admitted, or if not listed or admitted for trading on
any national securities exchange, on the Nasdaq National Market, or if such
securities are not quoted thereon, in the applicable securities market in which
the securities are traded.

         "Transaction" shall have the meaning set forth in paragraph (9)(e)
hereof.

         "25-Day Average Market Price" shall mean, for any security, the volume-
weighted average of the Current Market Prices of that security for the
twenty-five Trading Days immediately preceding the date of determination.

         (3) Rank. Any class or series of stock of the Corporation shall be
deemed to rank:

              (a) prior to the 5% Preferred Stock, either as to the payment of
dividends or as to distribution of assets upon liquidation, dissolution or
winding up, or both, if the holders of such class or series shall be entitled by
the terms thereof to the receipt of dividends and of amounts distributable upon
liquidation, dissolution or winding up, in preference or priority to the holders
of 5% Preferred Stock ("Senior Securities");

              (b) on a parity with the 5% Preferred Stock, either as to the
payment of dividends or as to distributions of assets upon liquidation,
dissolution or winding up, or both, whether or not the dividend rates, dividend
payment dates or redemption or liquidation prices per share thereof be different
from those of the 5% Preferred Stock, if the holders of the 5% Preferred Stock
and of such class of stock or series shall be entitled by the terms thereof to
the receipt of dividends or of amounts


                                       7

<PAGE>



distributable upon liquidation, dissolution or winding up, or both, in
proportion to their respective amounts of accrued and unpaid dividends per share
or liquidation preferences, without preference or priority one over the other
and such class of stock or series is not a class of Senior Securities ("Parity
Securities"); and

              (c) junior to the 5% Preferred Stock, either as to the payment of
dividends or as to the distribution of assets upon liquidation, dissolution or
winding up, or both, if such stock or series shall be Common Stock or if the
holders of the 5% Preferred Stock shall be entitled to receipt of dividends, and
of amounts distributable upon liquidation, dissolution or winding up, in
preference or priority to the holders of shares of such stock or series ("Junior
Securities").

              (d) Each of the 13% Series B Senior Redeemable Exchangeable
Preferred Stock (the "13% Preferred") and the 5 1/4% Convertible Preferred
Stock, Series A (the "5 1/4% Series A") and any dividends paid on the 5 1/4%
Series A in accordance with its terms, to the extent that such dividends are
paid in preferred stock having terms substantially identical to the 5 1/4%
Series A and any dividends paid on preferred stock issued as in-kind dividends
thereon, to the extent such dividends are paid in preferred stock having terms
substantially identical to the 5 1/4% Series A (the 5 1/4% Series A and all such
in-kind dividends being hereinafter referred to as the "5 1/4% Preferred"), is a
Senior Security. Each of the 5% Cumulative Participating Convertible Preferred
Stock, Series A (the "5% Convertible Series A") and any dividends paid on the 5%
Convertible Series A in accordance with its terms, to the extent that such
dividends are paid in preferred stock having terms substantially identical to
the 5% Convertible Series A and any dividends paid on preferred stock issued as
in-kind dividends thereon, to the extent such dividends are paid in preferred
stock having terms substantially identical to the 5% Convertible Series A (the
5% Convertible Series A and all such in-kind dividends being hereinafter
referred to as the "5% Convertible Preferred"), is a Parity Security. Each of
the 9.9% Non-Voting Mandatorily Redeemable Preferred Stock, Series B ("9.9%
Series B Preferred") and the Series A Junior Participating Preferred Stock is a
Junior Security. Except for the Preferred Stock proposed to be issued under the
terms of the Investment Agreement (and collectively with any dividends paid
thereon in preferred stock, the "5% Convertible Series B"), each of which would
be a Parity Security, there shall be no issue of other Senior Securities, Parity
Securities or rights or options exercisable for or convertible into any such
securities, except as approved by the holders of the 5% Preferred Stock, or as
otherwise permitted, pursuant to paragraph 9(c).


                                       8

<PAGE>



              (e) The respective definitions of Senior Securities, Junior
Securities and Parity Securities shall also include any rights or options
exercisable for or convertible into any of the Senior Securities, Junior
Securities and Parity Securities, as the case may be. The 5% Preferred Stock
shall be subject to the creation of Junior Securities, Parity Securities and
Senior Securities as set forth herein.

         (4) Dividends. (a) The holders of shares of 5% Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors, out of
funds legally available for the payment of dividends (after taking into account
revaluation of the assets and liabilities of the Corporation to the extent
deemed reasonable by the Board of Directors of the Corporation after
consultation with legal and financial advisors) but without regard to any
contractual or other restrictions with respect thereto, dividends at the
quarterly rate of US$12.50 per share (assuming a US$1,000 face amount) payable
in additional shares of the 5% Preferred Stock. All dividends on the 5%
Preferred Stock shall be payable in arrears on the Dividend Payment Date and
shall be cumulative from the Issue Date (except that dividends on additional
shares of the 5% Preferred Stock issued as dividends on 5% Preferred Stock shall
accrue from the date such additional shares of 5% Preferred Stock are issued or
would have been issued in accordance with this Certificate of Designation if
such dividends had been declared), whether or not in any Dividend Period or
Dividend Periods there shall be funds of the Corporation legally available for
the payment of such dividends. The total accumulative dividends for all Dividend
Periods terminating on or prior to the applicable redemption date shall be
payable to the holders of record of shares of the 5% Preferred Stock, as they
appear on the stock records of the Corporation at the close of business on the
record date for such dividend. Upon receipt by the Company of notice from the
holders of the 5% Preferred Stock that they have elected to require the Company
to discharge its Redemption Obligation, the Board of Directors shall fix as such
record date the fifth Business Day preceding the Dividend Payment Date and shall
give notice on or prior to the record date of the number of additional shares of
5% Preferred Stock payable in respect of the dividends accrued up to but
excluding the Dividend Payment Date.

         (b) For the purpose of determining the number of additional shares of
5% Preferred Stock to be issued as dividends pursuant to paragraph (4)(a), each
such share of additional 5% Preferred Stock shall be valued at US$1,000. Holders
of such additional shares of 5% Preferred Stock shall be entitled to receive
dividends payable at the rates specified in paragraph (4)(a).


                                       9
<PAGE>



         (c) The dividends payable for the initial Dividend Period, or any other
period shorter than a full Dividend Period, on the 5% Preferred Stock shall
accrue daily and be computed on the basis of a 360-day year and the actual
number of days in such period. No interest, or sum of money in lieu of interest,
shall be payable in respect of any dividend payment or payments on the 5%
Preferred Stock that may be in arrears except as otherwise provided herein.

         (d) So long as any shares of the 5% Preferred Stock are outstanding,
no dividends, except as described in the next succeeding sentence, shall be
declared or paid or set apart for payment on Parity Securities or Junior
Securities, for any period, nor shall any Parity Securities or Junior Securities
be redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the redemption of any
such Parity Securities or Junior Securities) by the Corporation (except for
conversion into or exchange into other Parity Securities or Junior Securities,
as the case may be) unless, in each case, (i) full cumulative dividends on all
outstanding shares of the 5% Preferred Stock for all Dividend Periods
terminating on or prior to the date of such redemption, repurchase or other
acquisition shall have been paid or set apart for payment (together with any
payments that may be required under paragraph (12)(c)), (ii) sufficient funds
shall have been paid or set apart for the payment of the dividend for the
current Dividend Period with respect to the 5% Preferred Stock and (iii) the
Corporation is not in default with respect to any redemption of shares of 5%
Preferred Stock by the Corporation pursuant to paragraph (6) below. When
dividends are not fully paid in additional shares of 5% Preferred Stock or a sum
sufficient for such payment is not set apart, as aforesaid, all dividends
declared upon shares of the 5% Preferred Stock and all dividends declared upon
Parity Securities shall be declared ratably in proportion to the respective
amounts of dividends accumulated and unpaid on the 5% Preferred Stock and
accumulated and unpaid on such Parity Securities.

         (e) So long as any shares of the 5% Preferred Stock are outstanding,
no dividends (other than (i) any rights issued pursuant to the Rights Agreement
and (ii) dividends or distributions paid in shares of, or options, warrants or
rights to subscribe for or purchase shares of, Junior Securities) shall be
declared or paid or set apart for payment or other distribution declared or made
upon Junior Securities, nor shall any Junior Securities be redeemed, purchased
or otherwise acquired (other than a redemption, purchase, or other acquisition
of shares of Common Stock made for purposes of an employee incentive or benefit
plan of the Corporation or any subsidiary) (all such dividends, distributions,
redemptions or purchases being hereinafter referred to as "Junior Securities
Distributions") for any consideration (or any moneys


                                       10
<PAGE>



be paid to or made available for a sinking fund for the redemption of any shares
of any such stock) by the Corporation, directly or indirectly (except by
conversion into or exchange for Junior Securities, including pursuant to
paragraph 4(d) of the 9.9% Series B Preferred), unless in each case (A) full
cumulative dividends on all outstanding shares of the 5% Preferred Stock and
all other Parity Securities shall have been paid or set apart for payment for
all past Dividend Periods and dividend periods for such other stock, (B)
sufficient funds shall have been paid or set apart for the payment of the
dividend for the current Dividend Period with respect to the 5% Preferred Stock
and all other Parity Securities, (C) the Corporation is not in default with
respect to any redemption of shares of 5% Preferred Stock by the Corporation
pursuant to paragraph (6) below and (D) the Corporation has fully performed its
obligations under paragraphs (4)(a) and (6) hereof.

         (f) Notwithstanding the provisions of Section 6(b) of the Purchase
Agreement, all payments by the Corporation of dividends on 5% Preferred Stock to
a holder thereof that is not a Qualified Holder (a "Non-Qualified Holder") will
be made free and clear of, and without deduction or withholding for, any present
or future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by the United States of America or by
any political subdivision or taxing authority thereof or therein with respect to
such payments (but excluding, except as provided in the second succeeding
sentence, any tax imposed on or measured by the net income or net profits of a
Non-Qualified Holder pursuant to the laws of the jurisdiction in which it is
organized or the jurisdiction in which the principal office or applicable
lending office of such Non-Qualified Holder is located or any subdivision
thereof or therein) and all interest, penalties or similar liabilities with
respect to such non-excluded taxes, levies, imposts, duties, fees, assessments
or other charges (all such non-excluded taxes, levies, imposts, duties, fees,
assessments or other charges being referred to collectively as "Taxes"). If any
Taxes are so levied or imposed, the Corporation agrees to pay the full amount of
such Taxes, and such additional amounts as may be necessary so that every
payment of all amounts due under the 5% Preferred Stock, after withholding or
deduction for or on account of any Taxes, will not be less than the amount
provided for herein or in such 5% Preferred Stock. If any amounts are payable
in respect of Taxes pursuant to the preceding sentence, the Corporation agrees
to reimburse each Non-Qualified Holder, upon the written request of such
Non-Qualified Holder, for taxes imposed on or measured by the net income or net
profits of such Non-Qualified Holder pursuant to the laws of the jurisdiction in
which such Non-Qualified Holder is organized or in which the principal office or
applicable lending office of such Non-Qualified Holder is located or under the
laws of any political subdivision or taxing authority of any


                                       11

<PAGE>



such jurisdiction in which such Non-Qualified Holder is organized or in which
the principal office or applicable lending office of such Non-Qualified Holder
is located and for any withholding of taxes as such Non-Qualified Holder shall
determine are payable by, or withheld from, such Non-Qualified Holder, in
respect of such amounts so paid to or on behalf of such Non-Qualified Holder
pursuant to the preceding sentence and in respect of any amounts paid to or on
behalf of such Non-Qualified Holder pursuant to this sentence. The Corporation
will furnish to each Non-Qualified Holder within 45 days after the date the
payment of any Taxes is due pursuant to applicable law certified copies of tax
receipts evidencing such payment by the Corporation. The Corporation agrees to
indemnify and hold harmless each Non-Qualified Holder, and reimburse such
Non-Qualified Holder upon its written request, for the amount of any Taxes so
levied or imposed and paid by such Non-Qualified Holder.

         (5) Liquidation Preference. (a) In the event of any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
before any payment or distribution of the assets of the Corporation (whether
capital or surplus) shall be made to or set apart for the holders of Junior
Securities, the holders of the shares of 5% Preferred Stock shall be entitled to
receive the Liquidation Right. If, upon any liquidation, dissolution or winding
up of the Corporation, the assets of the Corporation, or proceeds thereof,
distributable among the holders of the shares of 5% Preferred Stock shall be
insufficient to pay in full the preferential amount aforesaid and liquidating
payments on any Parity Securities, then such assets, or the proceeds thereof,
shall be distributed among the holders of shares of 5% Preferred Stock and any
such other Parity Securities ratably in accordance with the respective amounts
that would be payable on such shares of 5% Preferred Stock and any such other
stock if all amounts payable thereon were paid in full. For the purposes of this
paragraph (5), (i) a consolidation or merger of the Corporation with one or more
corporations, or (ii) a sale or transfer of all or substantially all of the
Corporation's assets, shall not be deemed to be a liquidation, dissolution or
winding up, voluntary or involuntary, of the Corporation.

         (b) Subject to the rights of the holders of any Parity Securities, upon
any liquidation, dissolution or winding up of the Corporation, after payment
shall have been made in full to the holders of the 5% Preferred Stock, as
provided in this paragraph (5), any other series or class or classes of Junior
Securities shall, subject to the respective terms and provisions (if any)
applying thereto, be entitled to receive any and all assets remaining to be paid
or distributed, and the holders of the 5% Preferred Stock shall not be entitled
to share therein.


                                       12

<PAGE>



         (6) Redemption. (a) On and after the date that is the second
anniversary of the Issue Date (the "Redemption Date"), each holder of shares of
5% Preferred Stock that is a Qualified Holder shall have the right to require
the Corporation, to the extent the Corporation shall have funds legally
available therefor (after taking into account revaluation of the assets and
liabilities of the Corporation to the extent deemed reasonable by the Board of
Directors of the Corporation after consultation with legal and financial
advisors) but without regard to any contractual or other restrictions with
respect thereto, to redeem all or some of such Qualified Holder's shares of 5%
Preferred Stock, from time to time in part, or in whole, at US$1,000 per share
(the "Redemption Price"), payable in cash, together with accrued and unpaid
dividends thereon to, but excluding, the date fixed for redemption, without
interest. Any holder of shares of 5% Preferred Stock that is a Qualified Holder
which elects to exercise its rights pursuant to this paragraph (6)(a) shall
deliver to the Corporation a written notice of election not less than 20 days
prior to the date on which such Qualified Holder demands redemption pursuant to
this paragraph (6)(a), which notice shall set forth the name of the Qualified
Holder, the number of shares of 5% Preferred Stock to be redeemed and a
statement that the election to exercise a redemption right is being made
thereby, and shall deliver to the Corporation on or before the date of
redemption certificates evidencing the shares of 5% Preferred Stock to be
redeemed, duly endorsed for transfer to the Corporation.

         (b) If the Corporation is unable to redeem all outstanding shares of 5%
Preferred Stock requested by any holder of 5% Preferred Stock to be redeemed
pursuant to paragraph (6)(a) (the "Redemption Obligation") because the
Corporation does not have funds legally available therefor, the Redemption
Obligation shall be discharged as soon as the Corporation has funds legally
available to discharge such Redemption Obligation and its obligations under
paragraph (12)(c). So long as the Corporation fails to discharge the Redemption
Obligation for any reason, dividends shall continue to accrue on the Redemption
Price in accordance with paragraph (4) in addition to dividends that accrue
pursuant to paragraph (12)(c). If and so long as any Redemption Obligation with
respect to the 5% Preferred Stock shall not be fully discharged, the Corporation
shall not (i) directly or indirectly, redeem, purchase, or otherwise acquire any
Parity Security or discharge any mandatory or optional redemption, sinking fund
or other similar obligation in respect of any Parity Securities (except in
connection with a redemption, sinking fund or other similar obligation to be
satisfied pro rata with the 5% Preferred Stock) or (ii) declare or make any
Junior Securities Distribution (other than dividends or distributions paid in
shares of, or options, warrants or rights to subscribe for or purchase shares
of, Junior Securi-


                                       13
<PAGE>


ties), or, directly or indirectly, discharge any mandatory or optional
redemption, sinking fund or other similar obligation in respect of the Junior
Securities.

         (c) On and after the date that is the earlier of (i) the second
anniversary of the Issue Date or (ii) the date an exchange is consummated
pursuant to paragraph (8)(a), the Corporation shall have the right to redeem
from any Qualified Holder, upon not less than five days' nor more than ten days'
notice of the redemption date, from time to time in part, or in whole, shares of
5% Preferred Stock, at the Redemption Price, payable in cash, together with
accrued and unpaid dividends thereon, including any dividend required under
paragraph (12)(c), to, but excluding, the date fixed for redemption, without
interest.

         (d) Upon the redemption of 5% Preferred Stock, the Corporation shall
pay the Redemption Price, any accrued and unpaid dividends in arrears to, but
excluding, the Dividend Payment Date, and any other dividend required under
paragraph (12)(c).

         (e) For purposes of paragraph (6)(a), unless full cumulative dividends
(whether or not declared) on all outstanding shares of 5% Preferred Stock and
any Parity Securities shall have been paid or contemporaneously are declared and
paid or set apart for payment for all Dividend Periods terminating on or prior
to the applicable redemption date and notice has been given in accordance with
paragraph (7), none of the shares of 5% Preferred Stock shall be redeemed, and
no sum shall be set aside for such redemption, unless shares of 5% Preferred
Stock are redeemed pro rata and notice has previously been given in accordance
with paragraph (7).

         (7) Procedure for Redemption. (a) When the Corporation is requested to
redeem shares of 5% Preferred Stock pursuant to paragraph (6), notice of the
request for such redemption shall be given by certified mail, return receipt
requested, postage prepaid, mailed not less than 20 days prior to the redemption
date, by each requesting


                                       14

<PAGE>



holder to the Corporation at the following address and confirmed by facsimile
transmission:

                           NTL Incorporated
                           110 East 59th Street
                           New York, New York 10022
                           Facsimile: (212) 906-8497

         Each such notice shall state (i) the redemption date and (ii) if the
holder is requiring the Corporation to redeem fewer than all the shares of 5%
Preferred Stock held by such holder, the number of shares that the Corporation
is being required to redeem from such holder.

         Within 10 days of receipt of any such notice from a holder of the 5%
Preferred Stock, the Corporation shall respond to each requesting holder with a
notice sent by certified mail, return receipt requested, postage prepaid, to
each requesting holder at such holder's address as the same appears on the stock
register of the Corporation and confirmed by facsimile transmission to each
requesting holder of record if the Corporation has been furnished with such
facsimile address by the holder(s); provided, however, that neither the failure
to give such notice nor confirmation nor any defect therein or in the mailing
thereof, to any particular holder, shall affect the sufficiency of the notice or
the validity of the proceedings for redemption with respect to the other
holders. Each such notice shall (i) confirm the redemption date and the number
of shares of 5% Preferred Stock to be redeemed and, if fewer than all the shares
held by such holder are to be redeemed, the number of shares to be redeemed from
such holder and (ii) state (A) the amount payable, (B) the place or places where
certificates for such shares are to be surrendered or the notice should be sent
for payment of the redemption price, and (C) that dividends on the shares to be
redeemed will cease to accrue at and from such redemption date, except as
otherwise provided herein. Any notice that was mailed in the manner herein
provided shall be conclusively presumed to have been duly given on the date
mailed whether or not the holder receives the notice.

         (b) If notice has been mailed by the Corporation in response to any
holder who has given the Corporation notice requesting redemption of any of its
shares of 5% Preferred Stock, as aforesaid, from and after the redemption date
(unless default shall be made by the Corporation in providing for the payment of
the redemption price of the shares called for redemption and dividends accrued
and unpaid thereon, if any), (i) except as otherwise provided herein, dividends
on the


                                       15
<PAGE>


shares of 5% Preferred Stock so called for redemption shall cease to accrue,
(ii) said shares shall no longer be deemed to be outstanding, and (iii) all
rights of the holders thereof as holders of the 5% Preferred Stock shall cease
(except the right to receive from the Corporation the Redemption Price without
interest thereon, upon surrender and endorsement of the certificates for any
shares so redeemed, and to receive any dividends payable thereon, including any
amounts payable pursuant to paragraph (12)(c)).

         (c) Upon surrender of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors of the
Corporation shall so require and the notice shall so state), such shares shall
be redeemed by the Corporation at the Redemption Price aforesaid, plus any
dividends payable thereon, including any amounts payable pursuant to paragraph
12(c). If fewer than all the outstanding shares of 5% Preferred Stock are to be
redeemed due to the restriction set forth in paragraph (6)(b), the number of
shares to be redeemed shall be determined by the Board of Directors and the
shares to be redeemed shall be selected pro rata (with any fractional shares
being rounded to the nearest whole share). In case fewer than all the shares
represented by any such certificate are redeemed, without cost to the holder
thereof either (i) a new certificate shall be issued representing the
non-surrendered shares, or (ii) at the option of the holder, the holder shall be
entitled to retain its existing certificates, which shall be deemed to represent
the number of shares of 5% Preferred Stock that have not been redeemed.

         (8) Exchange. (a) Upon at least 30 days' written notice to the Corpora-
tion, a Qualified Holder shall have the right, at such Qualified Holder's
option, to exchange all or any part of such shares of 5% Preferred Stock for
shares of Eurotel Stock (or to effect a constructive exchange in accordance with
paragraph (12)(d)) having a value (calculated pursuant to paragraph 8(c) below)
equal to the Redemption Price of the shares of 5% Preferred Stock with respect
to which the exchange right is being exercised, together with accrued and unpaid
dividends thereon to, but excluding, the date fixed for exchange, of such shares
of 5% Preferred Stock.

         (b) Any exchange pursuant to paragraph 8(a) shall be subject to the
following requirements:

              (i) The 5% Preferred Stock shall have been outstanding for at
least six months.


                                       16

<PAGE>


              (ii) Consummation of the exchange will not cause the Corporation,
any subsidiary of the Corporation, or Eurotel to become in breach or
contravention of, or give rise to a right to terminate or otherwise cause a loss
of any material right under, any material agreement, contract, instrument or
obligation of or binding on such entity; and the Corporation covenants and
agrees not to enter into any such agreement, contract or instrument or incur
such obligation after the date of issuance of the 5% Preferred Stock.

              (iii) All necessary approvals of any governmental competition or
other regulatory bodies or authorities having jurisdiction over the exchange or
any matters arising as a result thereof shall have been received, and the
exchange will have no material negative effect on any material governmental
license, permit or authorization held by Eurotel or any subsidiary of Eurotel;
provided that after receipt of a notice from a Qualified Holder under paragraph
8(a) the Corporation shall, subject to receiving in the case of competition
approvals full cooperation from the Qualified Holder, promptly take all
reasonable steps necessary to receive all such governmental competition and
regulatory approvals and to avoid any such material negative effect.

              (iv) The maximum amount of Eurotel Stock that may be acquired upon
an exchange shall be 50% of the outstanding amount thereof. Any shares of 5%
Preferred Stock remaining outstanding after acquisition of the maximum amount
of Eurotel Stock shall be subject to redemption in accordance with paragraph
6(a) hereof.

         (c) The aggregate value at any time of the Eurotel Stock shall equal
the aggregate amount expended by the Corporation and its subsidiaries in the
acquisition of the entities that comprise Eurotel (less the aggregate amount of
debt, as reflected on the consolidated balance sheet of Eurotel prepared in
conformity with GAAP, which is incurred or assumed by Eurotel or any of its
subsidiaries or entities comprising Eurotel or its predecessors in connection
therewith (the "Acquisition Debt")), together with any amounts invested in
Eurotel or any of its subsidiaries (other than by Eurotel or its subsidiaries)
after such acquisition and prior to the exchange, reduced by any dividends,
distribution or transfers of any assets from Eurotel to any other Person
increasing at a rate of 5% per annum from the date of such acquisition or
investment to the date the value of Eurotel is being calculated. The value of
each share of Eurotel Stock shall be pro rata to the aggregate value of Eurotel.


                                       17
<PAGE>



         (d) If at the time of any exchange of all of the 5% Preferred Stock,
the Eurotel Stock acquired as a result of such exchange does not constitute 50%
of the outstanding shares of Eurotel Stock, the Qualified Holder shall have the
right (subject to the conditions set forth in paragraph (b) above) to acquire
from the Corporation an additional amount of Eurotel Stock (the "Additional
Amount") such that the amount of Eurotel Stock held by such Qualified Holder as
a result of the exchange and the acquisition of the Additional Amount equals 50%
of the outstanding shares of Eurotel Stock. The Additional Amount shall be
acquired for cash at the same per share value calculated pursuant to paragraph
(c) above.

         (e) If Eurotel shall issue to the Corporation any option, warrant or
right to acquire Eurotel Stock, or if the issued Eurotel Stock shall be
comprised of more than one class, the rights of the Qualified Holder under this
paragraph (8) shall be equitably adjusted so as to maintain the intent of this
paragraph (8) that the Qualified Holder may acquire 50% of the Eurotel Stock
from the Corporation at a value reflecting the provisions of paragraph 8(c).

         (f) If any of the requirements set forth in paragraph (8)(b) cannot be
satisfied upon a Qualified Holder's exchange for Eurotel Stock under paragraph
8(a) or acquisition of Eurotel Stock under paragraph 8(d) of 50% of the
outstanding amount of Eurotel Stock, as determined in good faith by such
Qualified Holder and the Corporation, the Qualified Holder shall have the right
to acquire, upon exchange under paragraph 8(a) of any part of the 5% Preferred
Stock held by the Qualified Holder or acquisition under paragraph 8(d), such
amount of Eurotel Stock as would allow the requirements set forth in paragraph
(8)(b) to be satisfied. If the Qualified Holder exercises the right described in
the previous sentence, it shall have the right (i) to exchange or acquire the
remaining amount of Eurotel Stock as soon as possible after the restrictions on
the exchange or acquisition of the entire amount of Eurotel Stock permitted
hereunder shall cease to exist or (ii) to require redemption of any amount of
Preferred Shares that such Qualified Holder shall hold after exercising its
rights under the first sentence of this paragraph (8)(f).

         (g) The Corporation will pay any and all documentary stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of shares of
Eurotel Stock upon exchange of the 5% Preferred Stock pursuant hereto; provided,
however, that the Corporation shall not be required to pay any tax that may be
payable in respect of any transfer involved in the issue or delivery of shares
of Eurotel Stock in a name other than that of the holder of the 5% Preferred
Stock to be exchanged and no such issue or delivery shall be made unless and
until the Person


                                       18

<PAGE>


requesting such issue or delivery has paid to the Corporation the amount of any
such tax or established, to the satisfaction of the Corporation, that such tax
has been paid.

         (9) Conversion. (a) Subject to and upon compliance with the provisions
of this paragraph (9), each holder of shares of 5% Preferred Stock which is a
Qualified Holder shall have the right, at any time and from time to time after
the date which is six months from the consummation of an exchange pursuant to
paragraph (8)(a), at such holder's option, to convert any or all outstanding
shares of 5% Preferred Stock held by such holder, but not fractions of shares,
into fully paid and non-assessable shares of Common Stock by surrendering such
shares to be converted, such surrender to be made in the manner provided in
paragraph (9)(b) hereof. The number of shares of Common Stock deliverable upon
conversion of each share of 5% Preferred Stock shall be equal to $1,000 divided
by the 25-Day Average Market Price as of the date the exchange is consummated
(the "Exchange Date"), as adjusted as provided herein, provided that such
conversion rate (the "Conversion Rate") shall not be less than the price that
would cause an adjustment pursuant to Schedule 25, Section 2(c) of the Restated
Transaction Agreement, dated July 26, 1999, by and among Bell Atlantic
Corporation, Cable and Wireless plc, Cable & Wireless Communications plc and the
Corporation. The Conversion Rate is subject to adjustment from time to time
pursuant to paragraph (9)(d) hereof. The right to convert shares called for
redemption pursuant to paragraph 6(c) shall terminate at the close of business
on the date immediately preceding the date fixed for such redemption unless the
Corporation shall default in making payment of the amount payable upon such
redemption, in which case such right of conversion shall be reinstated. Upon
conversion, any accrued and unpaid dividends, including any dividends required
under paragraph (12)(c), on the 5% Preferred Stock at the date of conversion
shall be paid to the holder thereof in accordance with the provisions of
paragraph (4).

         (b) (i) In order to exercise the conversion privilege, the holder of
each share of 5% Preferred Stock to be converted shall surrender (or
constructively surrender in accordance with paragraph (12)(d)) the certificate
representing such share, duly endorsed or assigned to the Corporation or in
blank, at the office of the Corporation, or to any transfer agent of the
Corporation previously designated by the Corporation to the holders of the 5%
Preferred Stock for such purposes, with a written notice of election to convert
completed and signed, specifying the number of shares to be converted. Such
notice shall state that the holder has satisfied any legal or regulatory
requirement for conversion, including compliance with the Hart-Scott-Rodino
Antitrust Improvements Act of 1976; provided, however, that the Corporation
shall use its best efforts in cooperating with such holder to obtain such


                                       19

<PAGE>



legal or regulatory approvals to the extent its cooperation is necessary. Such
notice shall also state the name or names (with address and social security or
other taxpayer identification number, if applicable) in which the certificate or
certificates for Common Stock are to be issued. Unless the shares issuable on
conversion are to be issued in the same name as the name in which such share of
5% Preferred Stock is registered, each share surrendered for conversion shall be
accompanied by instruments of transfer, in form satisfactory to the
Corporation, duly executed by the holder or the holder's duly authorized
attorney and an amount sufficient to pay any transfer or similar tax (or
evidence reasonably satisfactory to the Corporation demonstrating that such
taxes have been paid). All certificates representing shares of 5% Preferred
Stock surrendered for conversion shall be canceled by the Corporation or the
transfer agent.

              (ii) Subject to the last sentence of paragraph (9)(a), holders of
shares of 5% Preferred Stock at the close of business on a dividend payment
record date shall not be entitled to receive the dividend payable on such shares
on the corresponding Dividend Payment Date if such holder shall have surrendered
(or made a constructive surrender under paragraph (12)(d)) for conversion such
shares at any time following the preceding Dividend Payment Date and prior to
such Dividend Payment Date.

              (iii) Subject to a holder's election under paragraph (12)(d), as
promptly as practicable after the surrender (including a constructive surrender
under paragraph (12)(d)) by a holder of the certificates for shares of 5%
Preferred Stock as aforesaid, the Corporation shall issue and shall deliver to
such holder, or on the holder's written order, a certificate or certificates
(which certificate or certificates shall have the legend set forth in paragraph
(12)(d)) for the whole number of duly authorized, validly issued, fully paid and
non-assessable shares of Common Stock issuable upon the conversion of such
shares in accordance with the provisions of this paragraph (9), and any
fractional interest in respect of a share of Common Stock arising on such
conversion shall be settled as provided in paragraph (9)(c). Upon conversion of
only a portion of the shares of 5% Preferred Stock represented by any
certificate, a new certificate shall be issued representing the unconverted
portion of the certificate so surrendered without cost to the holder thereof.
Subject to a holder's election under paragraph (12)(d), upon the surrender
(including a constructive surrender under paragraph (12)(d)) of certificates
representing shares of 5% Preferred Stock to be converted, such shares shall no
longer be deemed to be outstanding and all rights of a holder with respect to
such shares so surrendered shall


                                       20

<PAGE>



immediately terminate except the right to receive the Common Stock and other
amounts payable pursuant to this paragraph (9).

              (iv) Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which the certificates
for shares of 5% Preferred Stock shall have been surrendered (or deemed
surrendered pursuant to an election under paragraph (12)(d)) and such notice
received by the Corporation as aforesaid, and the person or persons in whose
name or names any certificate or certificates for shares of Common Stock shall
be issuable upon such conversion shall be deemed to have become the holder or
holders of record of the shares of Common Stock represented thereby at such time
on such date and such conversion shall be into a number of shares of Common
Stock equal to the product of the number of shares of 5% Preferred Stock
surrendered times the Conversion Rate in effect at such time on such date,
unless the stock transfer books of the Corporation shall be closed on that date,
in which event such Person or Persons shall be deemed to have become such holder
or holders of record at the close of business on the next succeeding day on
which such stock transfer books are open, but such conversion shall be based
upon the Conversion Rate in effect on the date upon which such shares shall have
been surrendered and such notice received by the Corporation.

         (c) (i) No fractional shares or scrip representing fractions of shares
of Common Stock shall be issued upon conversion of the 5% Preferred Stock.
Instead of any fractional interest in a share of Common Stock that would
otherwise be deliverable upon the conversion of a share of 5% Preferred Stock,
the Corporation shall pay to the holder of such share an amount in cash based
upon the Current Market Price of Common Stock on the Trading Day immediately
preceding the date of conversion. If more than one share shall be surrendered
for conversion (or deemed surrendered under paragraph (12)(d)) at one time by
the same holder, the number of full shares of Common Stock issuable upon
conversion thereof shall be computed on the basis of the aggregate number of
shares of 5% Preferred Stock surrendered (or deemed surrendered under paragraph
(12)(d)) for conversion by such holder.

              (ii) Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which the certificates
for shares of 5% Preferred Stock shall have been surrendered (or deemed
surrendered under paragraph (12)(d)) and such notice received by the Corporation
as aforesaid, and the Person or Persons in whose name or names any certificate
or certificates for shares of Common Stock shall be issuable upon such
conversion shall be deemed to


                                       21

<PAGE>


have become the holder or holders of record of the shares of Common Stock repre-
sented thereby at such time on such date and such conversion shall be into a
number of shares of Common Stock equal to the product of the number of shares of
5% Preferred Stock surrendered times the Conversion Rate in effect at such time
on such date, unless the stock transfer books of the Corporation shall be closed
on that date, in which event such Person or Persons shall be deemed to have
become such holder or holders of record at the close of business on the next
succeeding day on which such stock transfer books are open, but such conversion
shall be based upon the Conversion Rate in effect on the date upon which such
shares shall have been surrendered (or deemed surrendered under paragraph
(12)(d)) and such notice received by the Corporation.

         (d) The Conversion Rate shall be adjusted from time to time as follows:

              (i) If the Corporation shall after the Exchange Date (A) declare a
dividend or make a distribution on its Common Stock in shares of its Common
Stock, (B) subdivide its outstanding Common Stock into a greater number of
shares, (C) combine its outstanding Common Stock into a smaller number of
shares, or (D) effect any reclassification of its outstanding Common Stock, the
Conversion Rate in effect on the record date for such dividend or distribution,
or the effective date of such subdivision, combination or reclassification, as
the case may be, shall be proportionately adjusted so that the holder of any
share of 5% Preferred Stock thereafter surrendered for conversion shall be
entitled to receive the number and kind of shares of Common Stock that such
holder would have owned or have been entitled to receive after the happening of
any of the events described above had such share been converted immediately
prior to the record date in the case of a dividend or distribution or the
effective date in the case of a subdivision, combination or reclassification.
An adjustment made pursuant to this subparagraph (i) shall become effective
immediately after the opening of business on the Business Day next following the
record date (except as provided in paragraph (9)(h)) in the case of a dividend
or distribution and shall become effective immediately after the opening of
business on the Business Day next following the effective date in the case of a
subdivision, combination or reclassification. Adjustments in accordance with
this paragraph (9)(d)(i) shall be made whenever any event listed above shall
occur.

              (ii) If the Corporation shall after the Exchange Date fix a record
date for the issuance of rights or warrants (in each case, other than any rights
issued pursuant to a shareholder rights plan) to all holders of Common Stock


                                       22
<PAGE>



entitling them (for a period expiring within 45 days after such record date) to
subscribe for or purchase Common Stock (or securities convertible into Common
Stock) at a price per share (or, in the case of a right or warrant to purchase
securities convertible into Common Stock, having an effective exercise price per
share of Common Stock, computed on the basis of the maximum number of shares of
Common Stock issuable upon conversion of such convertible securities, plus the
amount of additional consideration payable, if any, to receive one share of
Common Stock upon conversion of such securities) less than the 25-Day Average
Market Price on the date on which such issuance was declared or otherwise
announced by the Corporation (the "Determination Date"), then the Conversion
Rate in effect at the opening of business on the Business Day next following
such record date shall be adjusted so that the holder of each share of 5%
Preferred Stock shall be entitled to receive, upon the conversion thereof, the
number of shares of Common Stock determined by multiplying (I) the Conversion
Rate in effect immediately prior to such record date by (II) a fraction, the
numerator of which shall be the sum of (A) the number of shares of Common Stock
outstanding on the close of business on the Determination Date and (B) the
number of additional shares of Common Stock offered for subscription or purchase
pursuant to such rights or warrants (or in the case of a right or warrant to
purchase securities convertible into Common Stock, the aggregate number of
additional shares of Common Stock into which the convertible securities so
offered are initially convertible), and the denominator of which shall be the
sum of (A) the number of shares of Common Stock outstanding on the close of
business on the Determination Date and (B) the number of shares that the
aggregate proceeds to the Corporation from the exercise of such rights or
warrants for Common Stock would purchase at such 25-Day Average Market Price on
such date (or, in the case of a right of warrant to purchase securities
convertible into Common Stock, the number of shares of Common Stock obtained by
dividing the aggregate exercise price of such rights or warrants for the maximum
number of shares of Common Stock issuable upon conversion of such convertible
securities, plus the aggregate amount of additional consideration payable, if
any, to convert such securities into Common Stock, by such 25-Day Average Market
Price). Such adjustment shall become effective immediately after the opening of
business on the Business Day next following such record date (except as provided
in paragraph (9)(h)). Such adjustment shall be made successively whenever such a
record date is fixed. In the event that after fixing a record date such rights
or warrants are not so issued, the Conversion Rate shall be readjusted to the
Conversion Rate which would then be in effect if such record date had not been
fixed. In determining whether any rights or warrants entitle the holders of
Common Stock to subscribe for or purchase shares of Common Stock at less than
such 25-Day Average Market Price, there shall be taken


                                       23
<PAGE>



into account any consideration received by the Corporation upon issuance and
upon exercise of such rights or warrants, the value of such consideration, if
other than cash, to be determined by the Board of Directors in good faith. In
case any rights or warrants referred to in this subparagraph (ii) shall expire
unexercised after the same have been distributed or issued by the Corporation
(or, in the case of rights or warrants to purchase securities convertible into
Common Stock once exercised, the conversion right of such securities shall
expire), the Conversion Rate shall be readjusted at the time of such expiration
to the Conversion Rate that would have been in effect if no adjustment had been
made on account of the distribution or issuance of such expired rights or
warrants.

              (iii) If the Corporation shall fix a record date for the making of
a distribution to all holders of its Common Stock of evidences of its
indebtedness, shares of its capital stock or assets (excluding regular cash
dividends or distributions declared in the ordinary course by the Board of
Directors and dividends payable in Common Stock for which an adjustment is made
pursuant to paragraph (9)(d)(i)) or rights or warrants (in each case, other than
any rights issued pursuant to a shareholder rights plan) to subscribe for or
purchase any of its securities (excluding those rights and warrants issued to
all holders of Common Stock entitling them (for a period expiring within 45 days
after such record date) to subscribe for or purchase Common Stock or securities
convertible into shares of Common Stock, which rights and warrants are referred
to in and treated under subparagraph (ii) above) (any of the foregoing being
hereinafter in this subparagraph (iii) called the "Securities"), then in each
such case the Conversion Rate shall be adjusted so that the holder of each share
of 5% Preferred Stock shall be entitled to receive, upon the conversion thereof,
the number of shares of Common Stock determined by multiplying (I) the
Conversion Rate in effect immediately prior to the close of business on such
record date by (II) a fraction, the numerator of which shall be the 25-Day
Average Market Price per share of the Common Stock on such record date, and the
denominator of which shall be the 25-Day Average Market Price per share of the
Common Stock on such record date less the then-fair market value (as determined
by the Board of Directors in good faith, whose determinations shall be
conclusive) of the portion of the assets, shares of its capital stock or
evidences of indebtedness so distributed or of such rights or warrants
applicable to one share of Common Stock. Such adjustment shall be made
successively whenever such a record date is fixed; and in the event that after
fixing a record date such distribution is not so made, the Conversion Rate shall
be readjusted to the Conversion Rate which would then be in effect if such
record date had not been fixed. Such adjustment shall become effective
immediately at the opening of business on the Business Day next following
(except as provided in paragraph (9)(h))


                                       24
<PAGE>



the record date for the determination of shareholders entitled to receive such
distribution. For the purposes of this subparagraph (iii), the distribution of
a Security, which is distributed not only to the holders of the Common Stock on
the date fixed for the determination of shareholders entitled to such
distribution of such Security, but also is distributed with each share of Common
Stock delivered to a Person converting a share of 5% Preferred Stock after such
determination date, shall not require an adjustment of the Conversion Rate
pursuant to this subparagraph (iii); provided, however, that on the date, if
any, on which a Person converting a share of 5% Preferred Stock would no longer
be entitled to receive such Security with a share of Common Stock (other than as
a result of the termination of all such Securities), a distribution of such
Securities shall be deemed to have occurred and the Conversion Rate shall be
adjusted as provided in this subparagraph (iii) (and such day shall be deemed to
be "the date fixed for the determination of shareholders entitled to receive
such distribution" and "the record date" within the meaning of the three
preceding sentences). If any rights or warrants referred to in this subparagraph
(iii) shall expire unexercised after the same shall have been distributed or
issued by the Corporation, the Conversion Rate shall be readjusted at the time
of such expiration to the Conversion Rate that would have been in effect if no
adjustment had been made on account of the distribution or issuance of such
expired rights or warrants.

              (iv) In case the Corporation shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash in the amount per share that,
together with the aggregate of the per share amounts of any other cash
distributions to all holders of its Common Stock made within the 12 months
preceding the date of payment of such distribution and in respect of which no
adjustment pursuant to this paragraph (iv) has been made exceeds 5.0% of the
25-Day Average Market Price immediately prior to the date of declaration of such
dividend or distribution (excluding any dividend or distribution in connection
with the liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, and any cash that is distributed upon a merger,
consolidation or other transaction for which an adjust ment pursuant to
paragraph 9(e) is made), then, in such case, the Conversion Rate shall be
adjusted so that the same shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the close of business on the
Record Date for the cash dividend or distribution by a fraction the numerator of
which shall be the Current Market Price of a share of the Common Stock on the
Record Date and the denominator shall be such Current Market Price less the per
share amount of cash so distributed during the 12-month period applicable to one
share of Common Stock, such adjustment to be effective immediately prior to the
opening of business on the Business Day following the Record Date; provided,


                                       25

<PAGE>



however, that in the event the denominator of the foregoing fraction is zero or
negative, in lieu of the foregoing adjustment, adequate provision shall be made
so that each holder of 5% Preferred Stock shall have the right to receive upon
conversion, in addition to the shares of Common Stock to which the holder is
entitled, the amount of cash such holder would have received had such holder
converted each share of 5% Preferred Stock at the beginning of the 12-month
period. In the event that such dividend or distribution is not so paid or made,
the Conversion Rate shall again be adjusted to be the Conver sion Rate which
would then be in effect if such dividend or distribution had not been declared.
Notwithstanding the foregoing, if any adjustment is required to be made as set
forth in this paragraph (9)(d)(iv), the calculation of any such adjustment shall
include the amount of the quarterly cash dividends paid during the 12-month
reference period only to the extent such dividends exceed the regular quarterly
cash dividends paid during the 12 months preceding the 12-month reference
period. For purposes of this paragraph (9)(d)(iv), "Record Date" shall mean,
with respect to any dividend or distribution in which the holders of Common
Stock have the right to receive cash, the date fixed for determination of
shareholders entitled to receive such cash.

         In the event that at any time cash distributions to holders of Common
Stock are not paid equally on all series of Common Stock, the provisions of this
paragraph 9(d)(iv) will apply to any cash dividend or cash distribution on any
series of Common Stock otherwise meeting the requirements of this paragraph, and
shall be deemed amended to the extent necessary so that any adjustment required
will be made on the basis of the cash dividend or cash distribution made on any
such series.

              (v) In case of the consummation of a tender or exchange offer
(other than an odd-lot tender offer) made by the Corporation or any subsidiary
of the Corporation for all or any portion of the outstanding shares of Common
Stock to the extent that the cash and fair market value (as determined in good
faith by the Board of Directors of the Corporation, whose determination shall be
conclusive and shall be described in a resolution of such Board) of any other
consideration included in such payment per share of Common Stock at the last
time (the "Expiration Time") tenders or exchanges may be made pursuant to such
tender or exchange offer (as amended) exceed by more than 5.0%, with any smaller
excess being disregarded in computing the adjustment to the Conversion Rate
provided in this paragraph (9)(d)(v), the first reported sale price per share of
the Common Stock on the Trading Day next succeeding the Expiration Time, then
the Conversion Rate shall be adjusted so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior to the
Expiration Time by a fraction the numerator of


                                       26
<PAGE>



which shall be the sum of (x) the fair market value (determined as aforesaid) of
the aggregate consideration payable to shareholders based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of all
shares validly tendered or exchanged and not withdrawn as of the Expiration Time
(the shares deemed so accepted, up to any such maximum, being referred to as the
"Purchase Shares") and (y) the product of the number of shares of Common Stock
outstanding (less any Purchase Shares) on the Expiration Time and the first
reported sale price of the Common Stock on the Trading Day next succeeding the
Expiration Time, and the denominator of which shall be the number of shares of
Common Stock outstanding (including any tendered or exchanged shares) on the
Expiration Time multiplied by the first reported sale price of the Common Stock
on the Trading Day next succeeding the Expiration Time, such adjustment to
become effective immediately prior to the opening of business on the day
following the Expiration Time.

              (vi) No adjustment in the Conversion Rate shall be required unless
such adjustment would require a cumulative increase or decrease of at least 1%
in the Conversion Rate; provided, however, that any adjustments that by reason
of this subparagraph (vi) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment until made, and provided
further that any adjustment shall be required and made in accordance with the
provisions of this paragraph (9) (other than this subparagraph (vi)) not later
than such time as may be required in order to preserve the tax-free nature of a
distribution for United States income tax purposes to the holders of shares of
5% Preferred Stock or Common Stock. Notwithstanding any other provisions of this
paragraph (9), the Corporation shall not be required to make any adjustment of
the Conversion Rate for the issuance of any shares of Common Stock pursuant to
any plan providing for the reinvestment of dividends or interest payable on
securities of the Corporation and the investment of additional optional amounts
in shares of Common Stock under such plan. All calculations under this paragraph
(9) shall be made to the nearest dollar or to the nearest 1/1,000 of a share, as
the case may be. Anything in this paragraph (9)(d) to the contrary
notwithstanding, the Corporation shall be entitled, to the extent permitted by
law, to make such adjustments in the Conversion Rate, in addition to those
required by this paragraph (9)(d), as it in its discretion shall determine to be
advisable in order that any stock dividends subdivision of shares,
reclassification or combination of shares, distribution or rights or warrants to
purchase stock or securities, or a distribution of other assets (other than
cash dividends) hereafter made by the Corporation to its shareholders shall not
be taxable.


                                       27
<PAGE>



              (vii) In the event that, at any time as a result of shares of any
other class of capital stock becoming issuable in exchange or substitution for
or in lieu of shares of Common Stock or as a result of an adjustment made
pursuant to the provisions of this paragraph (9)(d), the holder of 5% Preferred
Stock upon subsequent conversion shall become entitled to receive any shares of
capital stock of the Corporation other than Common Stock, the number of such
other shares so receivable upon conversion of any shares of 5% Preferred Stock
shall thereafter be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions contained herein.

         (e) If the Corporation shall be a party to any transaction (including
without limitation, a merger, consolidation, sale of all or substantially all of
the Corporation's assets or recapitalization of the Common Stock and excluding
any transaction as to which paragraph (9)(d)(i) applies) (each of the foregoing
being referred to herein as a "Transaction"), in each case as a result of which
shares of Common Stock shall be converted into the right to receive stock,
securities or other property (including cash or any combination thereof), there
shall be no adjustment to the Conversion Rate but each share of 5% Preferred
Stock which is not converted into the right to receive stock, securities or
other property in connection with such Transaction shall thereafter be
convertible into the kind and amount of shares of stock, securities and other
property (including cash or any combination thereof) receivable upon the
consummation of such Transaction by a holder of that number of shares or
fraction thereof of Common Stock into which one share of 5% Preferred Stock was
convertible immediately prior to such Transaction, assuming such holder of
Common Stock (i) is not a Person with which the Corporation consolidated or into
which the Corporation merged or which merged into the Corporation or to which
such sale or transfer was made, as the case may be ("Constituent Person"), or an
affiliate of a Constituent Person and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of stock securities and other
property (including cash) receivable upon such Transaction (provided that if the
kind or amount of stock, securities and other property (including cash)
receivable upon such Transaction is not the same for each share of Common Stock
of the Corporation held immediately prior to such Transaction by other than a
Constituent Person or an affiliate thereof and in respect of which such rights
of election shall not have been exercised ("non-electing share"), then for the
purpose of this paragraph (9)(e) the kind and amount of stock, securities and
other property (including cash) receivable upon such Transaction by each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares). The provisions of this
paragraph (9)(e) shall similarly apply to successive Transactions.


                                       28
<PAGE>


         (f) If:

              (i) the Corporation shall declare a dividend (or any other
distribution) on the Common Stock; or

              (ii) the Corporation shall authorize the granting to the holders
of the Common Stock of rights or warrants to subscribe for or purchase any
shares of any class or any other rights or warrants; or

              (iii) there shall be any subdivision, combination or reclassi-
fication of the Common Stock or any consolidation or merger to which the Corpora
tion is a party and for which approval of any shareholders of the Corporation is
required, or the sale or transfer of all or substantially all of the assets of
the Corporation as an entirety; or

              (iv) there shall occur the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation;

then the Corporation shall cause to be filed with any transfer agent designated
by the Corporation pursuant to paragraph (9)(b) and shall cause to be mailed to
the holders of shares of the 5% Preferred Stock at their addresses as shown on
the stock records of the Corporation, as promptly as possible, but at least ten
days prior to the applicable date hereinafter specified, a notice stating (A)
the date on which a record is to be taken for the purpose of such dividend (or
such other distribution) or rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights or warrants are to be determined or (B)
the date on which such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding up or
other action is expected to become effective, and the date as of which it is
expected that holders of Common Stock of record shall be entitled to exchange
their shares of Common Stock for securities or other property, if any,
deliverable upon such subdivision, combination, reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution or winding up. Failure to give
or receive such notice or any defect therein shall not affect the legality or
validity of any distribution, right, warrant subdivision, combination,
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, winding up or other action, or the vote upon any of the foregoing.


                                       29

<PAGE>



         (g) Whenever the Conversion Rate is adjusted as herein provided, the
Corporation shall prepare an officer's certificate with respect to such
adjustment of the Conversion Rate setting forth the adjusted Conversion Rate and
the effective date of such adjustment and shall mail a copy of such officer's
certificate to the holder of each share of 5% Preferred Stock at such holder's
last address as shown on the stock records of the Corporation. If the
Corporation shall have designated a transfer agent pursuant to paragraph (9)(b),
it shall also promptly file with such transfer agent an officer's certificate
setting forth the Conversion Rate after such adjustment and setting forth a
brief statement of the facts requiring such adjustment which certificate shall
be conclusive evidence of the correctness of such adjustment.

         (h) In any case in which paragraph (9)(d) provides that an adjustment
shall become effective on the day next following a record date for an event, the
Corporation may defer until the occurrence of such event (i) issuing to the
holder of any share of 5% Preferred Stock converted after such record date and
before the occurrence of such event the additional shares of Common Stock
issuable upon such conversion by reason of the adjustment required by such event
over and above the Common Stock issuable upon such conversion before giving
effect to such adjustment and (ii) paying to such holder any amount in cash in
lieu of any fraction pursuant to paragraph (9)(c).

         (i) For purposes of this paragraph (9), the number of shares of Common
Stock at any time outstanding shall not include any shares of Common Stock then
owned or held by or for the account of the Corporation. The Corporation shall
not pay a dividend or make any distribution on shares of Common Stock held in
the treasury of the Corporation.

         (j) There shall be no adjustment of the Conversion Rate in case of the
issuance of any stock of the Corporation in a reorganization, acquisition or
other similar transaction except as specifically set forth in this paragraph
(9). If any single action would require adjustment of the Conversion Rate
pursuant to more than one subparagraph of this paragraph (9), only one
adjustment shall be made and such adjustment shall be the amount of adjustment
that has the highest absolute value.

         (k) If the Corporation shall take any action affecting the Common
Stock, other than action described in this paragraph (9), that in the opinion of
the Board of Directors materially adversely affects the conversion rights of the
holders of the shares of 5% Preferred Stock, the Conversion Rate may be
adjusted, to the extent permitted by law, in such manner, if any, and at such
time, as the Board of Directors


                                       30
<PAGE>



may determine to be equitable in the circumstances; provided that the provisions
of this paragraph (9)(k) shall not affect any rights the holders of 5% Preferred
Stock may have at law or in equity.

         (l) (i) The Corporation covenants that it will at all times reserve and
keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued shares of Common Stock or its issued shares of Common
Stock held in its treasury, or both, for the purpose of effecting conversion of
the 5% Preferred Stock, the full number of shares of Common Stock deliverable
upon the conversion of all outstanding shares of 5% Preferred Stock not
theretofore converted. For purposes of this paragraph (9)(l) the number of
shares of Common Stock that shall be deliverable upon the conversion of all
outstanding shares of 5% Preferred Stock shall be computed as if at the time of
computation all such outstanding shares were held by a single holder.

              (ii) The Corporation covenants that any shares of Common Stock
issued upon conversion of the 5% Preferred Stock shall be duly authorized,
validly issued, fully paid and non-assessable. Before taking any action that
would cause an adjustment increasing the Conversion Rate such that the quotient
of $1,000.00 and the Conversion Rate would be reduced below the then-par value
of the shares of Common Stock deliverable upon conversion of the 5% Preferred
Stock, the Corporation will take any corporate action that, in the opinion of
its counsel, may be necessary in order that the Corporation may validly and
legally issue fully paid and non-assessable shares of Common Stock based upon
such adjusted Conversion Rate.

              (iii) Prior to the delivery of any securities that the Corpora-
tion shall be obligated to deliver upon conversion of the 5% Preferred Stock,
the Corporation shall comply with all applicable federal and state laws and
regulations which required action to be taken by the Corporation.

         (m) The Corporation will pay any and all documentary stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of shares of
Common Stock or other securities or property on conversion of the 5% Preferred
Stock pursuant hereto; provided, however, that the Corporation shall not be
required to pay any tax that may be payable in respect of any transfer involved
in the issue or delivery of shares of Common Stock or other securities or
property in a name other than that of the holder of the 5% Preferred Stock to be
converted and no such issue or delivery shall be made unless and until the
Person requesting such issue or delivery


                                       31
<PAGE>



has paid to the Corporation the amount of any such tax or established, to the
satisfaction of the Corporation, that such tax has been paid.

         (10) Voting Rights. (a) The holders of record of shares of 5% Preferred
Stock shall not be entitled to any voting rights except as hereinafter provided
in this paragraph (10) or as otherwise provided by law. When and if the holders
of 5% Preferred Stock are entitled to vote by law or pursuant to this paragraph
(10), each holder will be entitled to one vote per share except that when any
other series of preferred stock shall have the right to vote with the 5%
Preferred Stock as a single class on any matter, then the 5% Preferred Stock and
other series shall have with respect to such matters one vote per $1,000 of
stated liquidation preference.

         (b) Without the written consent of the holders of at least 662/3% of
aggregate Liquidation Rights of the outstanding shares of 5% Preferred Stock or
the vote of holders of at least 662/3% of aggregate Liquidation Rights of the
outstanding shares of 5% Preferred Stock at a meeting of the holders of 5%
Preferred Stock called for such purpose, the Corporation will not amend, alter
or repeal any provision of the Restated Certificate of Incorporation (by merger
or otherwise) so as to adversely affect the preferences, rights or powers of the
5% Preferred Stock; pro vided that any such amendment that changes the dividend
payable on, or the aggregate Liquidation Rights of, the 5% Preferred Stock
shall require the affirmative vote at a meeting of holders of 5% Preferred Stock
called for such purpose or written consent of the holder of each share of 5%
Preferred Stock.

         (c) Without the written consent of the holders of at least 66 2/3% of
aggregate Liquidation Rights of the outstanding shares of 5% Preferred Stock or
the vote of holders of at least 662/3% of aggregate Liquidation Rights of the
outstanding shares of 5% Preferred Stock at a meeting of such holders called for
such purpose, the Corporation will not issue any additional 5% Preferred Stock
or create, authorize or issue any Parity Securities or Senior Securities or
increase the authorized amount of any such other class or series; provided that
this paragraph (9)(c) shall not limit the right of the Corporation to (i) issue
additional shares of 5% Preferred Stock as dividends pursuant to paragraph (4)
or (ii) to issue Parity Securities or Senior Securities in order to refinance,
redeem or refund the 13% Preferred, the 5 1/4% Preferred, the 5% Convertible
Preferred Series A or the 5% Convertible Preferred Series B, provided that in
the case of a refinancing, redemption or refund of the 13% Preferred or the 5
1/4% Preferred, the maximum accrual value (i.e., the sum of stated value and
maximum amount payable in kind over the term from issuance to first date of
mandatory redemption or redemption at the option of the holder) of such Parity


                                       32

<PAGE>



Securities or Senior Securities issued by the Corporation in such refinancing,
as shall be reflected on the Corporation's consolidated balance sheet prepared
in accordance with GAAP applied on a basis consistent with the Corporation's
prior practice, may not exceed the maximum accrual value of the 13% Preferred,
or the 5 1/4% Preferred or the 5% Convertible Preferred respectively, as
reflected on the Corporation's consolidated balance sheet as contained in the
report filed by the Corporation with the United States Securities and Exchange
Commission pursuant to the Exchange Act that is most recent prior to such
refinancing.

         (d) Nothing in this paragraph (10) shall be in derogation of any rights
that a holder of shares of 5% Preferred Stock may have in his capacity as a
holder of shares of Common Stock.

         (e) Except as otherwise set forth in this paragraph (10) or as required
by law, the holders of 5% Preferred Stock shall not have any relative,
participating, optional or other special voting rights and powers, except as
provided by this Certificate or in any agreement the Corporation and a holder
and the consent or vote of such holders shall not be required for the taking of
any corporate action by the Corporation or the Board of Directors. The
provisions of this paragraph (10) are in lieu of, and not in addition to, any
voting rights specified in the Restated Certifi cate of Incorporation as
applicable to a series of Preferred Stock.

         (11) Holding Company. Notwithstanding anything herein to the contrary,
if the Corporation is reorganized such that the Common Stock is exchanged for
the common stock of a new entity ("Holdco") whose common stock is traded on
NASDAQ or another recognized securities exchange, then the Corporation, by
notice to the holders of the 5% Preferred Stock but without any required consent
on their part, may cause the exchange of this 5% Preferred Stock for 5%
preferred stock of Holdco having the same terms, conditions, ranking and other
rights as set forth herein, provided that (i) Holdco shall be incorporated under
the Delaware General Corporation Law and be based in the United States and (ii)
to the extent permitted by applicable law, the certificates representing shares
of the 5% Preferred Stock prior to the formation of Holdco shall be deemed to
represent shares of the new 5% preferred stock, and the holder thereof shall not
be required to surrender or exchange its certificates representing shares of 5%
Preferred Stock.

         (12) General Provisions. (a) The headings of the paragraphs, subpara
graphs, clauses and subclauses of this Certificate of Designation are for


                                       33

<PAGE>


convenience of reference only and shall not define, limit or affect any of the
provisions hereof.

         (b) The shares of 5% Preferred Stock shall bear the following legend:

    THE SHARES OF PREFERRED STOCK, PAR VALUE $0.01, OF THE CORPORATION (THE
    "PREFERRED STOCK") REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR
    SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER THE SECURITIES ACT OF
    1933, AS AMENDED (THE "ACT") AND ANY APPLICABLE STATE SECURITIES LAWS OR IN
    ACCORDANCE WITH ANY APPLICABLE EXEMPTION FROM, OR TRANSACTION NOT SUBJECT
    TO, THE REGIS TRATION REQUIREMENTS UNDER THE ACT. THE TRANS FER OF THE
    PREFERRED STOCK EVIDENCED BY THIS CER TIFICATE IS SUBJECT TO THE
    RESTRICTIONS ON TRANSFER PROVIDED FOR IN THE PURCHASE AGREEMENT, DATED
    FEBRUARY [ ], 2000, AS MAY BE AMENDED, AMONG THE CORPORATION AND CERTAIN
    PURCHASERS, A COPY OF WHICH IS ON FILE AT THE EXECUTIVE OFFICES OF THE
    CORPORATION AND WILL BE FURNISHED WITHOUT CHARGE TO THE HOLDER OF SUCH
    PREFERRED STOCK UPON WRITTEN REQUEST TO THE CORPORATION.

    SO LONG AS ANY OF THE PREFERRED STOCK ARE RESTRICTED SECURITIES WITHIN THE
    MEANING OF RULE 144(a)(3) UNDER THE ACT, THE CORPORATION WILL, DURING ANY
    PERIOD IN WHICH (A) THE CORPORATION IS NOT SUBJECT TO AND IN COMPLIANCE WITH
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE
    "EXCHANGE ACT"), OR (B) THE COR PORATION IS NOT EXEMPT FROM THE REPORTING
    OBLIGATIONS OF RULE 12g3-2(B) OF THE EXCHANGE ACT, PROVIDE TO EACH HOLDER OF
    SUCH RESTRICTED SECURITIES AND TO EACH PRO SPECTIVE PURCHASER (AS DESIGNATED
    BY SUCH HOLDER) OF SUCH RESTRICTED SECURITIES, UPON THE REQUEST OF SUCH
    HOLDER OR PROSPECTIVE PURCHASER, ANY


                                       34
<PAGE>


    INFORMATION REQUIRED TO BE PROVIDED BY SUBJECTION (d)(4)(i) OF RULE 144(A)
    UNDER THE ACT.

         (c) If the Corporation shall have failed to declare or pay dividends as
required pursuant to paragraph (4) hereof or shall have failed to discharge the
Redemption Obligation pursuant to paragraph (6) hereof, the holders of shares of
5% Preferred Stock shall be entitled to receive, in addition to all other
amounts required to be paid hereunder, when, as and if declared by the Board of
Directors, out of funds legally available for the payment of dividends (after
taking into account revaluation of the assets and liabilities of the Corporation
to the extent deemed reasonable by the Board of Directors of the Corporation
after consultation with legal and financial advisors) but without regard to any
contractual or other restrictions with respect thereto, cash dividends on (i)
the aggregate dividends which the Corporation shall have failed to declare or
pay or (ii) the aggregate Redemption Price together with accrued and unpaid
dividends on the 5% Preferred Stock, as applicable, in each case at a rate of 2%
per quarter, compounded quarterly, for the period during which the failure to
pay dividends or failure to discharge the Redemption Obligation shall continue.

         (d) (i) Whenever in connection with any exchange or conversion of the
5% Preferred Stock for Eurotel Stock or Common Stock, as applicable, the
Qualified Holder is required to surrender certificates representing such shares
of 5% Preferred Stock, the Qualified Holder may, by written notice to the
Corporation and its transfer agent, elect to retain such certificates. In such
case, the certificates so retained by the Qualified Holder shall be deemed (as
and to the extent permitted by the law of the jurisdiction of incorporation of
Eurotel and with respect to Common Stock, Delaware) to represent, at and from
the date of such exchange, the number of shares of Eurotel Stock or the Common
Stock, as the case may be, issuable upon such exchange pursuant to paragraph (8)
or conversion pursuant to paragraph (9).

              (ii) (A) A Qualified Holder which has previously elected to retain
certificates representing the 5% Preferred Stock in accordance with para graph
(12)(d)(i) upon exchange or conversion may subsequently elect to receive
certificates representing the shares of Eurotel Stock or the Common Stock issued
upon such exchange or conversion. To receive certificates representing such
shares of Eurotel Stock or the Common Stock, as applicable, the holder of such
certificates shall surrender it, duly endorsed or assigned to the Corporation or
in blank, at the office of the Corporation, or to any transfer agent of the
Corporation previously


                                       35

<PAGE>


designated by the Corporation for such purposes, with a written notice of that
election.

         (B) Unless the certificates to be issued shall be registered in the
same name as the name in which such surrendered certificates are registered,
each certificate so surrendered shall be accompanied by instruments of transfer,
in form satisfactory to the Corporation, duly executed by the Qualified Holder
or the Qualified Holder's duly authorized attorney and an amount sufficient to
pay any transfer or similar tax (or evidence reasonably satisfactory to the
Corporation demonstrating that such taxes have been paid). All certificates so
surrendered shall be canceled by the Corporation or the transfer agent.

         (C) As promptly as practicable after the surrender by the Qualified
Holder of such certificates, the Corporation shall issue and shall deliver to
such Qualified Holder, or on the Qualified Holder's written order, a certificate
or certificates for the number of duly authorized, validly issued, fully paid
and non-assessable shares of Eurotel Stock or the Common Stock, as applicable,
represented by the certificates so surrendered.

         IN WITNESS WHEREOF, NTL Incorporated has caused this Certificate of
Designation to be signed by the undersigned this [ ] day of [           ], 2000.


                                     NTL INCORPORATED


                                     By:
                                        ----------------------------------------
                                        Name:   Richard J. Lubasch
                                        Title:  Executive Vice President,
                                                General Counsel and Secretary