<PAGE>   1

                                                                   EXHIBIT 3.1.4


                    CERTIFICATE OF DESIGNATION OF THE POWERS,
                    PREFERENCES AND RELATIVE, PARTICIPATING,
            OPTIONAL AND OTHER SPECIAL RIGHTS OF 14% SERIES A SENIOR
                  EXCHANGEABLE REDEEMABLE PREFERRED SHARES AND
              QUALIFICATIONS, LIMITATIONS AND RESTRICTIONS THEREOF
--------------------------------------------------------------------------------

                         Pursuant to Section 151 of the
                        Delaware General Corporation Law
--------------------------------------------------------------------------------


              NM Acquisition Corp., the successor by merger to NEXTLINK
Communications, Inc. and to be known as NEXTLINK Communications, Inc.
immediately after the filing of this Certificate of Designation (the
"Corporation"), a corporation organized and existing under the Delaware General
Corporation Law, does hereby certify that, pursuant to authority conferred upon
the board of directors of the Corporation (the "Board of Directors") by its
Section 3 of its Amended and Restated Certificate of Incorporation, as amended
from time to time (the "Certificate of Incorporation) and pursuant to the
provisions of Section 151 of the Delaware General Corporation Law (the "DGCL"),
said Board of Directors, on June 13, 2000, duly approved and adopted a
resolution to read as follows (the "Resolution"):

              RESOLVED, that, pursuant to the authority vested in the Board of
Directors by Section 3 of the Corporation's Certificate of Incorporation, and
Section 151 of the DGCL, the Board of Directors does hereby create, authorize
and provide for the issuance of 14% Series A Senior Exchangeable Redeemable
Preferred Shares, par value $.01 per share, with a stated value of $50 per
share, in an amount not to exceed 11,700,000 shares, having the designations,
preferences, relative, participating, optional and other special rights and the
qualifications, limitations and restrictions thereof that are set forth in the
Certificate of Incorporation and in this Resolution as follows:

              (a)    Designation.

              There is hereby created out of the authorized and unissued
Preferred Shares of the Corporation a class of Preferred Shares designated as
the "14% Series A Senior Exchangeable Redeemable Preferred Shares." The number
of shares constituting such class shall not exceed and are referred to as the
"Senior Exchangeable Redeemable Preferred Shares." The liquidation preference of
the Senior Exchangeable Redeemable Preferred Shares shall be $50 per share. The
Senior Exchangeable Redeemable Preferred Shares shall consist of the Original
Shares and the Exchange Shares.

              (b)    Ranking.

              The Senior Exchangeable Redeemable Preferred Shares shall, with
respect to dividends and distributions upon liquidation, winding-up and
dissolution of the Corporation, rank (i) senior to the Corporation's 7% Series F
Convertible Redeemable Preferred Stock due 2010, the Corporation's Series C
Cumulative Convertible Participating Preferred Stock, the Corporation's Series D
Convertible Participating Preferred Stock, the Corporation's 6 1/2% Series B
Cumulative Convertible Preferred Stock and all classes of common stock of the
Corporation,


<PAGE>   2


and to each other class of capital stock or series of preferred stock
established after June 3, 1998 by the Board of Directors the terms of which do
not expressly provide that it ranks senior to or on a parity with the Senior
Exchangeable Preferred Shares as to dividend distributions and distributions
upon the liquidation, winding-up and dissolution of the Company (collectively
referred to as "Junior Shares"); (ii) on a parity with the Corporation's 13%
Series E Senior Redeemable Exchangeable Preferred Stock due 2010 and any class
of Capital Stock of the Corporation or series of Preferred Shares of the
Corporation hereafter created the terms of which expressly provide that such
class or series will rank on a parity with the Senior Exchangeable Redeemable
Preferred Shares as to dividends and distributions upon liquidation, winding-up
and dissolution (collectively referred to as "Parity Shares"); provided that any
such Parity Shares that were not issued in compliance with paragraph (ii)(A)
hereof shall be deemed to be Junior Shares and not Parity Shares; and (iii)
junior to each class of Capital Stock of the Corporation or series of Preferred
Shares of the Corporation hereafter created that has been issued in compliance
with paragraph (f)(ii)(B) hereof and the terms of which expressly provide that
such class or series will rank senior to the Senior Exchangeable Redeemable
Preferred Shares as to dividends and distributions upon liquidation, winding-up
and dissolution of the Corporation (collectively referred to as "Senior
Shares").

              (c)    Dividends.

                     (i)    (A)    Beginning on the Issue Date, the Holders of
              the outstanding Senior Exchangeable Redeemable Preferred Shares
              shall be entitled to receive, when, as and if declared by the
              Board of Directors, out of funds legally available therefor,
              distributions in the form of dividends on each Senior Exchangeable
              Redeemable Preferred Share, at a rate per annum equal to 14% of
              the liquidation preference per share of the Senior Exchangeable
              Redeemable Preferred Shares, payable quarterly. No interest shall
              be payable in respect to any dividends that may be in arrears. All
              dividends shall be cumulative, whether or not earned or declared,
              on a daily basis from their date of issuance and shall be payable
              quarterly in arrears on each Dividend Payment Date, commencing on
              the first Dividend Payment Date after the Merger Date. Dividends
              may be paid at the Corporation's option on any Dividend Payment
              Date occurring on or before February 1, 2002, either in cash or by
              issuing additional fully paid and nonassessable Senior
              Exchangeable Redeemable Preferred Shares with an aggregate
              liquidation preference equal to the amount of such dividends.
              After February 1, 2002, dividends shall be paid only in cash. Each
              dividend shall be payable to the Senior Exchangeable Redeemable
              Preferred Shares held by Holders of record as they appear on the
              share books of the Corporation on the Dividend Record Date
              immediately preceding the related Dividend Payment Date. Dividends
              shall cease to accumulate in respect of the Senior Exchangeable
              Redeemable Preferred Shares on the Exchange Date or on the date of
              their earlier redemption unless the Corporation shall have failed
              to issue the appropriate aggregate principal amount of Exchange
              Notes in respect of the Senior Exchangeable Redeemable Preferred
              Shares on such Exchange Date or shall have failed to pay the
              relevant redemption price on the date fixed for redemption.



                                       2
<PAGE>   3


                            (B)    In the event that (1) the Corporation or its
                     successor has not filed the registration statement relating
                     to the Exchange Offer (or, if applicable, the registration
                     statement relating to the shelf registration of the Senior
                     Exchangeable Redeemable Preferred Shares for resale by
                     holders contemplated by the Registration Rights Agreement
                     (the "Resale Registration")) on or before the 45th day
                     after the Issue Date, (2) such registration statement (or,
                     if applicable, the Resale Registration) has not become
                     effective on or before the 120th day after the Issue Date,
                     (3) the Exchange Offer has not been consummated within 30
                     Business Days following the initial effective date of the
                     registration statement relating to the Exchange Offer or
                     (4) any registration statement required by the Registration
                     Rights Agreement is filed and declared effective but shall
                     thereafter cease to be effective (except as specifically
                     permitted therein) without being succeeded immediately by
                     an additional registration statement filed and declared
                     effective (any such event referred to in clauses (1)
                     through (4), a "Registration Default"), then additional
                     dividends will accrue (in addition to the stated dividends
                     on the Senior Exchangeable Redeemable Preferred Shares) at
                     the rate of 0.25% per annum on the liquidation preference
                     of the Senior Exchangeable Redeemable Preferred Shares for
                     the period from and including the occurrence of the
                     Registration Default until such time as no Registration
                     Default is in effect. Such additional dividends (the
                     "Special Dividends") will be payable quarterly in arrears
                     on each regular Dividend Payment Date in accordance with
                     the provisions of this paragraph (c). For each 90-day
                     period that the Registration Default continues, the per
                     annum rate of such Special Dividends will increase by an
                     additional 0.25%; provided that such rate shall in no event
                     exceed 1.0% per annum in the aggregate. At such time as the
                     Registration Default is no longer in effect, the dividend
                     rate on the Senior Exchangeable Redeemable Preferred Shares
                     shall be the rate stated in paragraph (c)(i)(A) hereof and
                     no further Special Dividends will accrue unless and until
                     another Registration Default shall occur

                     (ii)   All dividends paid with respect to the Senior
              Exchangeable Redeemable Preferred Shares pursuant to paragraph
              (c)(i) shall be paid pro rata to the Holders entitled thereto.

                     (iii)  Nothing herein contained shall in any way or under
              any circumstances be construed or deemed to require the Board of
              Directors to declare, or the Corporation to pay or set apart for
              payment, any dividends on the Senior Exchangeable Redeemable
              Preferred Shares at any time.

                     (iv)   Dividends on account of arrears for any past
              Dividend Period and dividends in connection with any mandatory
              redemption pursuant to paragraph (e)(ii) may be declared and paid
              at any time, without reference to any regular Dividend Payment
              Date, to Holders of record on such date, not more than forty-




                                       3
<PAGE>   4


              five (45) days prior to the payment thereof, as may be fixed by
              the Board of Directors of the Corporation.

                     (v)    No full dividends shall be declared by the Board of
              Directors or paid or set apart for payment by the Corporation on
              any Parity Shares for any period unless full cumulative dividends
              have been or contemporaneously are declared and paid in full, or
              declared and, if payable in cash, a sum in cash set apart
              sufficient for such payment, on the Senior Exchangeable Redeemable
              Preferred Shares for all Dividend Periods terminating on or prior
              to the date of payment of such full dividends on such Parity
              Shares. If full dividends are not so paid, all dividends declared
              upon the Senior Exchangeable Redeemable Preferred Shares and any
              other Parity Shares shall be declared pro rata so that the amount
              of dividends declared per share on the Senior Exchangeable
              Redeemable Preferred Shares and such Parity Shares shall in all
              cases bear to each other the same ratio that accrued dividends per
              share on the Senior Exchangeable Redeemable Preferred Shares and
              such Parity Shares bear to each other.

                     (vi)   (A)    Holders of the Senior Exchangeable Redeemable
              Preferred Shares shall be entitled to receive the dividends
              provided for in paragraph (c)(i) hereof in preference to and in
              priority over any dividends upon any of the Junior Shares.

                            (B)    No dividends may be paid or set apart for
                     such payment on Junior Shares (except dividends on Junior
                     Shares payable in additional Junior Shares) if full
                     cumulative dividends have not been paid in full on the
                     Senior Exchangeable Redeemable Preferred Shares. So long as
                     any Senior Exchangeable Redeemable Preferred Shares are
                     outstanding, the Corporation shall not make any payment on
                     account of, or set apart for payment money for a sinking or
                     other similar fund for, the purchase, redemption or other
                     retirement of, any Parity Shares or Junior Shares, or any
                     warrants, rights, calls or options to purchase any Parity
                     Shares or Junior Shares, whether in cash, obligations or
                     shares of the Corporation or other property, and shall not
                     permit any corporation or other entity directly or
                     indirectly controlled by the Corporation to purchase or
                     redeem any Parity Shares or Junior Shares or any such
                     warrants, rights, calls or options unless full cumulative
                     dividends determined in accordance herewith on the Senior
                     Exchangeable Redeemable Preferred Shares have been paid in
                     full.

                     (vii)  Dividends payable on the Senior Exchangeable
              Redeemable Preferred Shares for any period shorter than a
              quarterly dividend period shall be computed on the basis of a
              360-day year of twelve 30-day months and the actual number of days
              elapsed in the period for which payable.

              (d)    Liquidation Preference.

                     (i)    In the event of any voluntary or involuntary
              liquidation, dissolution or winding-up of affairs of the
              Corporation, the Holders of Senior Exchangeable



                                       4
<PAGE>   5


              Redeemable Preferred Shares then outstanding shall be entitled to
              be paid, out of the assets of the Corporation available for
              distribution to its shareholders, an amount in cash equal to the
              liquidation preference of $50 per Senior Exchangeable Redeemable
              Preferred Share, plus, without duplication, an amount in cash
              equal to accumulated and unpaid dividends thereon to the date
              fixed for liquidation, dissolution or winding-up (including an
              amount equal to a prorated dividend for the period from the last
              Dividend Payment Date to the date fixed for liquidation,
              dissolution or winding-up) before any payment shall be made or any
              assets distributed to the holders of any of the Junior Shares
              including, without limitation, common stock of the Corporation.
              Except as provided in the preceding sentence, Holders of Senior
              Exchangeable Redeemable Preferred Shares shall not be entitled to
              any distribution in the event of any liquidation, dissolution or
              winding-up of the affairs of the Corporation. If the assets of the
              Corporation are not sufficient to pay in full the liquidation
              payments payable to the Holders of outstanding Senior Exchangeable
              Redeemable Preferred Shares and all Parity Shares, then the
              holders of all such shares shall share equally and ratably in such
              distribution of assets in proportion to the full liquidation
              preference, including, without duplication, all accrued and unpaid
              dividends, to which each is entitled.

                     (ii)   For the purposes of this paragraph (d), neither the
              sale, conveyance, exchange or transfer (for cash, shares of stock,
              securities or other consideration) of all or substantially all of
              the property or assets of the Corporation nor the consolidation or
              merger of the Corporation with or into one or more entities shall
              be deemed to be a liquidation, dissolution or winding-up of the
              affairs of the Corporation.

              (e)    Redemption.

                     (i)    [Intentionally omitted.]

                     (ii)   Mandatory Redemption. On February 1, 2009, the
              Corporation shall redeem, to the extent of funds legally available
              therefor, in the manner provided for in paragraph (e)(iii) hereof,
              all of the Senior Exchangeable Redeemable Preferred Shares then
              outstanding at a redemption price equal to 100% of the liquidation
              preference per share, plus, without duplication, an amount in cash
              equal to all accumulated and unpaid dividends per share (including
              an amount equal to a prorated dividend for the period from the
              Dividend Payment Date immediately prior to the Redemption Date to
              the Redemption Date) (the "Mandatory Redemption Price").

                     (iii)  Procedures for Redemption.

                            (A)    At least thirty (30) days and not more than
                     sixty (60) days prior to the date fixed for any redemption
                     of the Senior Exchangeable Redeemable Preferred Shares
                     pursuant to paragraph (e)(ii) hereof, written notice (each,
                     a "Redemption Notice") shall be given by first class mail,
                     postage prepaid, to each Holder of record on the record
                     date fixed for such



                                       5
<PAGE>   6


                     redemption of the Senior Exchangeable Redeemable Preferred
                     Shares at such Holder's address as it appears on the stock
                     books of the Corporation, provided that no failure to give
                     such notice nor any deficiency therein shall affect the
                     validity of the procedure for the redemption of any Senior
                     Exchangeable Redeemable Preferred Shares to be redeemed
                     except as to the Holder or Holders to whom the Corporation
                     has failed to give said notice or except as to the Holder
                     or Holders whose notice was defective. The Redemption
                     Notice shall state:

                                   (1)    [Intentionally omitted.];

                                   (2)    The Mandatory Redemption Price;

                                   (3)    The Redemption Date;

                                   (4)    That the Holder is to surrender to the
                            Corporation, in the manner, at the place or places
                            and at the price designated, his certificate or
                            certificates representing the Senior Exchangeable
                            Redeemable Preferred Shares to be redeemed; and

                                   (5)    That dividends on the Senior
                            Exchangeable Redeemable Preferred Shares to be
                            redeemed shall cease to accumulate on such
                            Redemption Date unless the Corporation defaults in
                            the payment of Mandatory Redemption Price.

                            (B)    Each Holder of Senior Exchangeable Redeemable
                     Preferred Shares shall surrender the certificate or
                     certificates representing such Senior Exchangeable
                     Redeemable Preferred Shares to the Corporation, duly
                     endorsed (or otherwise in proper form for transfer, as
                     determined by the Corporation), in the manner and at the
                     place designated in the Redemption Notice, and on the
                     Redemption Date the full Mandatory Redemption Price for
                     such shares shall be payable in cash to the Person whose
                     name appears on such certificate or certificates as the
                     owner thereof, and each surrendered certificate shall be
                     canceled and retired.

                            (C)    On and after the Redemption Date, unless the
                     Corporation defaults in the payment in full of the
                     applicable redemption price, dividends on the Senior
                     Exchangeable Redeemable Preferred Shares called for
                     redemption shall cease to accumulate on the Redemption
                     Date, and all rights of the Holders of redeemed shares
                     shall terminate with respect thereto on the Redemption
                     Date, other than the right to receive the Mandatory
                     Redemption Price, without interest; provided, however, that
                     if a notice of redemption shall have been given as provided
                     in paragraph (iii)(A) above and the funds necessary for
                     redemption (including an amount in respect of all dividends
                     that will accrue to the Redemption Date) shall have been
                     irrevocably deposited in trust for the equal and ratable
                     benefit for the Holders of the shares called for
                     redemption, then, at




                                       6
<PAGE>   7


                     the close of business on the day on which such funds are
                     segregated and set apart, the Holders of the shares to be
                     redeemed shall cease to be shareholders of the Corporation
                     and shall be entitled only to receive the Mandatory
                     Redemption Price, without interest.

              (f)    Voting Rights.

                     (i)    The Holders of Senior Exchangeable Redeemable
              Preferred Shares, except as otherwise required under Delaware law
              or as set forth in paragraphs (ii), (iii) and (iv) below, shall
              not be entitled or permitted to vote on any matter required or
              permitted to be voted upon by the shareholders of the Corporation.

                     (ii)   (A)    So long as any Senior Exchangeable Redeemable
              Preferred Shares are outstanding, the Corporation shall not
              authorize or issue any Parity Shares (other than additional Senior
              Exchangeable Redeemable Preferred Shares issued as dividends on
              the Senior Exchangeable Redeemable Preferred Shares in accordance
              with the terms hereof and Exchange Shares) without the affirmative
              vote or consent of Holders of at least a majority of the then
              outstanding Senior Exchangeable Redeemable Preferred Shares,
              voting or consenting, as the case may be, as a separate class,
              given in person or by proxy, either in writing or by resolution
              adopted at an annual or special meeting, if after giving effect to
              the issuance of such Parity Shares, the aggregate liquidation
              preference of the outstanding Parity Shares (other than (i) the
              Senior Exchangeable Redeemable Preferred Shares originally issued
              on the Issue Date, (ii) additional Senior Exchangeable Redeemable
              Preferred Shares issued as dividends in accordance with the terms
              hereof on the Senior Exchangeable Redeemable Preferred Shares
              originally issued on the Issue Date and additional Senior
              Exchangeable Redeemable Preferred Shares issued as dividends on
              the Senior Exchangeable Redeemable Preferred Shares in accordance
              with the terms hereof and (iii) any Exchange Shares) would exceed
              the sum of (x) $50 million and (y) the aggregate amount of gross
              proceeds received after the Issue Date and on or prior to the date
              of issuance of such Parity Shares from the issuance of Qualified
              Junior Shares.

                            (B)    So long as any Senior Exchangeable Redeemable
                     Preferred Shares are outstanding, the Corporation shall not
                     authorize any class of Senior Shares without the
                     affirmative vote or consent of Holders of at least
                     two-thirds of the outstanding Senior Exchangeable
                     Redeemable Preferred Shares, voting or consenting, as the
                     case may be, as a separate class, given in person or by
                     proxy, either in writing or by resolution adopted at an
                     annual or special meeting.

                            (C)    So long as any Senior Exchangeable Redeemable
                     Preferred Shares are outstanding, the Corporation shall not
                     amend, alter or repeal any of the provisions of the
                     Corporation's Certificate of Incorporation (including this
                     Certificate of Designations) or the by-laws of the
                     Corporation so as to affect adversely the specified rights,
                     powers,



                                       7
<PAGE>   8

                     preferences, privileges or voting rights of the holders of
                     Senior Exchangeable Redeemable Preferred Shares or reduce
                     the time for any notice which the holders of the Senior
                     Exchangeable Redeemable Preferred Shares may be entitled
                     without the affirmative vote or consent of Holders of at
                     least two-thirds of the issued and outstanding Senior
                     Exchangeable Redeemable Preferred Shares, voting or
                     consenting, as the case may be, as one class, given in
                     person or by proxy, either in writing or by resolution
                     adopted at an annual or special meeting.

                            (D)    Notwithstanding the foregoing, modifications
                     and amendments of the terms of this Certificate of
                     Designations contained in paragraphs (h) and (l) below may
                     be made by the Corporation with the consent of the Holders
                     of a majority of the outstanding Senior Exchangeable
                     Redeemable Preferred Shares; provided, however, that no
                     such modification or amendment may, without the consent of
                     the Holder of each outstanding Senior Exchangeable
                     Redeemable Preferred Share affected thereby following the
                     mailing of any Offer to Purchase and until the Expiration
                     Date of that Offer to Purchase, modify any Offer to
                     Purchase for the Senior Exchangeable Redeemable Preferred
                     Shares required by paragraph (h) hereof in a manner
                     materially adverse to the holders of outstanding Senior
                     Exchangeable Redeemable Preferred Shares. In addition, the
                     holders of a majority of the outstanding Senior
                     Exchangeable Redeemable Preferred Shares, on behalf of all
                     holders of Senior Exchangeable Redeemable Preferred Shares,
                     may waive compliance by the Corporation with the covenants
                     described below in paragraphs (h) and (l) and may waive any
                     past default under the Certificate of Designations, except
                     a default arising from failure to purchase any Senior
                     Exchangeable Redeemable Preferred Shares tendered pursuant
                     to an Offer to Purchase.

                            (E)    Prior to the exchange of Senior Exchangeable
                     Redeemable Preferred Shares for Exchange Notes, the
                     Corporation shall not amend or modify the form of the
                     Indenture for the Exchange Notes as it exists on the Issue
                     Date (the "Indenture") (except as expressly provided
                     therein in respect of amendments that may be made without
                     the consent of Holders of Exchange Notes) without the
                     affirmative vote or consent of Holders of at least a
                     majority of the Senior Exchangeable Redeemable Preferred
                     Shares then outstanding, voting or consenting, as the case
                     may be, as one class, given in person or by proxy, either
                     in writing or by resolution adopted at an annual or special
                     meeting.

                            (F)    Except as set forth in paragraphs (f)(ii)(A),
                     (f)(ii)(B) and (f)(ii)(C) above, (x) the creation,
                     authorization or issuance of any shares of any Junior
                     Shares, Parity Shares or Senior Shares or (y) the increase
                     or decrease in the amount of authorized Capital Stock of
                     any class, including Senior Shares or Parity Shares, shall
                     not require the consent of Holders of Senior Exchangeable
                     Redeemable Preferred Shares and shall not be



                                       8
<PAGE>   9


                     deemed to affect adversely the rights, preferences,
                     privileges or voting rights of Holders of Senior
                     Exchangeable Redeemable Preferred Shares.

                            (G)    Notwithstanding the foregoing, at any time
                     following a Covenant Amendment, the Corporation may, at its
                     election and without the consent of any Holder of Senior
                     Exchangeable Redeemable Preferred Shares, amend the
                     Corporation's Certificate of Incorporation (including this
                     Certificate of Designations) to add provisions making the
                     Senior Exchangeable Redeemable Preferred Shares redeemable
                     at the option of the Corporation (subject to contractual
                     and other restrictions with respect thereto and the legal
                     availability of funds therefor) as follows: (x) At any time
                     on or after February 1, 2002, in whole or in part, at the
                     option of the Corporation, at the redemption prices
                     (expressed in percentages of the liquidation preference
                     thereof) set forth below, plus, without duplication, an
                     amount in cash equal to all accumulated and unpaid
                     dividends to the Redemption Date (including an amount in
                     cash equal to a prorated dividend for the period from the
                     Dividend Payment Date immediately prior to the Redemption
                     Date), if redeemed during the 12-month period beginning
                     February 1 of each of the years set forth below:

<TABLE>
<CAPTION>
Year                                                    Percentage
----                                                    ----------
<S>                                                     <C>
2002                                                       107.00%
2003                                                       105.25
2004                                                       103.50
2005                                                       101.75
2006 and thereafter                                        100.00
</TABLE>

In the event of redemption of only a portion of the then outstanding Senior
Exchangeable Redeemable Preferred Shares, the Corporation shall effect such
redemption on a pro rata basis.

(y) Prior to February 1, 2000, in part, in an amount not to exceed 35% of the
initial aggregate liquidation preference of the Senior Exchangeable Redeemable
Preferred Shares originally issued out of the net cash proceeds of one or more
Qualifying Events (other than any Qualifying Event that results in a Change of
Control) at a redemption price of 114.0% of the liquidation preference thereof
plus, without duplication, an amount in cash equal to all accumulated and unpaid
dividends to the redemption date (including an amount in cash equal to a
prorated dividend for the period from the Dividend Payment Date immediately
prior to the Redemption Date); provided, however, that after any such
redemption, the aggregate liquidation preference of the Senior Exchangeable
Redeemable Preferred Shares outstanding must equal at least 65% of the Senior
Exchangeable Redeemable Preferred Shares issued on the Issue Date. Any such
redemption shall occur on or prior to 60 days after the receipt by the
Corporation of the proceeds of such Qualifying Event.

                     (iii)  Without the affirmative vote or consent of Holders
              of a majority of the issued and outstanding Senior Exchangeable
              Redeemable Preferred Shares, voting or consenting, as the case may
              be, as a separate class, given in person or by



                                       9
<PAGE>   10


              proxy, either in writing or by resolution adopted at an annual or
              special meeting, the Corporation shall not, in a single
              transaction or series of related transactions, consolidate with or
              merge with or into, or sell, assign, transfer, lease, convey or
              otherwise dispose of all or substantially all of its assets to,
              another Person or adopt a plan of liquidation unless: (A) either
              (1) the Corporation is the surviving or continuing Person or (2)
              the Person (if other than the Corporation) formed by such
              consolidation or into which the Corporation is merged or the
              Person that acquires by conveyance, transfer or lease the
              properties and assets of the Corporation substantially as an
              entirety or in the case of a plan of liquidation, the Person to
              which assets of the Corporation have been transferred, shall be a
              corporation, limited liability Corporation, partnership or trust
              organized and existing under the laws of the United States or any
              State thereof or the District of Columbia; (B) the Senior
              Exchangeable Redeemable Preferred Shares shall be converted into
              or exchanged for and shall become shares of Capital Stock of such
              successor, transferee or resulting Person, having in respect of
              such successor, transferee or resulting Person, having the same
              powers, preferences and relative, participating, optional or other
              special rights and the qualifications, limitations or restrictions
              thereon, that the Senior Exchangeable Redeemable Preferred Shares
              had immediately prior to such transaction; (C) immediately after
              giving pro forma effect to such transaction, no Voting Rights
              Triggering Event shall have occurred or be continuing; and (D) the
              Corporation has delivered to the Transfer Agent prior to the
              consummation of the proposed transaction an Officers' Certificate
              and an Opinion of Counsel, each stating that such consolidation,
              merger or transfer complies with the terms hereof and that all
              conditions precedent herein relating to such transaction have been
              satisfied.

For purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise, in a single transaction or series of related transactions) of all or
substantially all of the properties or assets of one or more Subsidiaries of the
Corporation, the Capital Stock of which constitutes all or substantially all of
the properties and assets of the Corporation, shall be deemed to be the transfer
of all or substantially all of the properties and assets of the Corporation.

                     (iv)   (A)    If (1) dividends on the Senior Exchangeable
              Redeemable Preferred Shares are in arrears and unpaid (and, if
              after February 1, 2002, such dividends are not paid in cash) for
              six or more Dividend Periods (whether or not consecutive) (a
              "Dividend Default"); (2) the Corporation fails to redeem all of
              the then outstanding Senior Exchangeable Redeemable Preferred
              Shares on February 1, 2009 or fails otherwise to discharge any
              redemption obligation with respect to the Senior Exchangeable
              Redeemable Preferred Shares; (3) the Corporation fails to make an
              Offer to Purchase (whether pursuant to the terms of paragraph
              (h)(i) or otherwise) following a Change of Control if such Offer
              to Purchase is required by paragraph (h) hereof or fails to
              purchase Senior Exchangeable Redeemable Preferred Shares from
              Holders who elect to have such shares purchased pursuant to the
              Offer to Purchase; (4) the Corporation breaches or violates one of
              the provisions set forth in any paragraphs (f)(iii) or (1) hereof
              and the breach or violation continues for a period of 30 days or
              more after the Corporation receives notice thereof specifying the
              default from the Holders of at least 25% of the



                                       10
<PAGE>   11


              Senior Exchangeable Redeemable Preferred Shares then outstanding,
              or (5) the Corporation fails to pay at the final stated maturity
              (giving effect to any extensions thereof) the principal amount of
              any Debt of the Corporation or any Subsidiary of the Corporation,
              or the final stated maturity of any such Debt is accelerated, if
              the aggregate principal amount of such Debt, together with the
              aggregate principal amount of any other such Debt in default for
              failure to pay principal at the final stated maturity (giving
              effect to any extensions thereof) or that has been accelerated,
              aggregates $15,000,000 or more at any time, in each case, after a
              10-day period during which such default shall not have been cured
              or such acceleration rescinded, then in the case of any of clauses
              (1)-(5) the number of directors constituting the Board of
              Directors shall be adjusted by the number, if any, necessary to
              permit the Holders of the Senior Exchangeable Redeemable Preferred
              Shares, voting together with any outstanding Party Shares
              separately as a single class, to elect the lesser of two directors
              and that number of directors constituting 25% of the members of
              the Board of Directors. Each such event described in clauses (1),
              (2), (3), (4) and (5) is a "Voting Rights Triggering Event."
              Holders of a majority of the issued and outstanding Senior
              Exchangeable Redeemable Preferred Shares, voting together with any
              outstanding Parity Shares separately as a single class, shall have
              the exclusive right to elect the lesser of two directors and that
              number of directors constituting 25% of the members of the Board
              of Directors at a meeting therefor called upon occurrence of such
              Voting Rights Triggering Event, and at every subsequent meeting at
              which the terms of office of the directors so elected (other than
              as described in (f)(iv)(B) below). The voting rights provided
              herein shall be the exclusive remedy at law or in equity of the
              holders of the Senior Exchangeable Redeemable Preferred Shares for
              any Voting Rights Triggering Event.

                            (B)    The right of the Holders of Senior
                     Exchangeable Redeemable Preferred Shares to elect members
                     of the Board of Directors as set forth in subparagraph
                     (f)(iv)(A) above shall continue until such time as (x) in
                     the event such right arises due to a Dividend Default, all
                     accumulated dividends that are in arrears on the Senior
                     Exchangeable Redeemable Preferred Shares are paid in full
                     (and, in the case of dividends payable after February 1,
                     2002, paid in cash) and (y) in all other cases, the
                     failure, breach or default giving rise to such Voting
                     Rights Triggering Event is remedied or waived by the
                     holders of at least a majority of the Senior Exchangeable
                     Redeemable Preferred Shares then outstanding, at which time
                     (1) the special right of the Holders of Senior Exchangeable
                     Redeemable Preferred Shares so to vote for the election of
                     directors and (2) the term of office of the directors
                     elected by the Holders of the Senior Exchangeable
                     Redeemable Preferred Shares shall each terminate and the
                     directors elected by the holders of Voting Stock other than
                     the Senior Exchangeable Redeemable Preferred Shares shall
                     constitute the entire Board of Directors. At any time after
                     voting power to elect directors shall have become vested
                     and be continuing in the Holders of Senior Exchangeable
                     Redeemable Preferred Shares pursuant to paragraph
                     (f)(iv)(A) hereof, or if vacancies shall exist in the
                     offices of directors



                                       11
<PAGE>   12


                     elected by the Holders of Senior Exchangeable Redeemable
                     Preferred Shares, a proper officer of the Corporation may,
                     and upon the written request of the Holders of record of at
                     least twenty-five percent (25%) of the Senior Exchangeable
                     Redeemable Preferred Shares then outstanding addressed to
                     the Secretary of the Corporation shall, call a special
                     meeting of the Holders of Senior Exchangeable Redeemable
                     Preferred Shares, for the purpose of electing the directors
                     which such Holders are entitled to elect. If such meeting
                     shall not be called by a proper officer of the Corporation
                     within twenty (20) days after personal service of said
                     written request upon the Secretary of the Corporation, or
                     within twenty (20) days after mailing the same within the
                     United States by certified mail, addressed to the Secretary
                     of the Corporation at its principal executive offices, then
                     the Holders of record of at least twenty-five percent (25%)
                     of the outstanding Senior Exchangeable Redeemable Preferred
                     Shares may designate in writing one of their number to call
                     such meeting at the expense of the Corporation, and such
                     meeting may be called by the Person so designated upon the
                     notice required for the annual meetings of shareholders of
                     the Corporation and shall be held at the place for holding
                     the annual meetings of shareholders. Any Holder of Senior
                     Exchangeable Redeemable Preferred Shares so designated
                     shall have, and the Corporation shall provide, access to
                     the lists of shareholders to be called pursuant to the
                     provisions hereof.

                            (C)    At any meeting held for the purpose of
                     electing directors at which the Holders of Senior
                     Exchangeable Redeemable Preferred Shares voting together
                     with any outstanding shares of Parity Shares as a separate
                     class shall have the right as described herein to elect
                     directors, the presence in person or by proxy of the
                     Holders of at least a majority of the then outstanding
                     Senior Exchangeable Redeemable Preferred Shares and Parity
                     Shares shall be required to constitute a quorum of such
                     Senior Exchangeable Redeemable Preferred Shares and Parity
                     Shares.

                            (D)    Any vacancy occurring in the office of a
                     director elected by the Holders of Senior Exchangeable
                     Redeemable Preferred Shares and Parity Shares may be filled
                     by the remaining directors elected by the Holders of Senior
                     Exchangeable Redeemable Preferred Shares and Parity Shares
                     unless and until such vacancy shall be filled by the
                     Holders of Senior Exchangeable Redeemable Preferred Shares
                     and Parity Shares.

                     (v)    In any case in which the Holders of Senior
              Exchangeable Redeemable Preferred Shares shall be entitled to vote
              pursuant to this paragraph (f) or pursuant to Delaware law, each
              Holder of Senior Exchangeable Redeemable Preferred Shares entitled
              to vote with respect to such matter shall be entitled to one vote
              for each share of Senior Exchangeable Redeemable Preferred Shares
              held.



                                       12
<PAGE>   13


              (g)    Exchange.

                     (i)    Requirements.  The outstanding Senior Exchangeable
              Redeemable Preferred Shares are exchangeable as a whole but not in
              part, at the option of the Corporation at any time on any Dividend
              Payment Date for the Corporation's 14% Senior Subordinated Notes
              due 2009 (the "Exchange Notes") to be substantially in the form
              set forth in the Indenture, a copy of which is on file with the
              secretary of the Corporation and the Transfer Agent, provided that
              any such exchange may only be made if on or prior to the date of
              such exchange (A) the Corporation has paid all accumulated
              dividends on the Senior Exchangeable Redeemable Preferred Shares
              (including the dividends payable on the date of exchange) and
              there shall be no contractual impediment to such exchange and (B)
              immediately after giving effect to such exchange, no Default or
              Event of Default (as defined in the Indenture) would exist under
              the Indenture and no default or event of default would exist under
              the Existing Indenture. The exchange rate shall be $1.00 principal
              amount of Exchange Notes for each $1.00 of the aggregate
              liquidation preference of Senior Exchangeable Redeemable Preferred
              Shares, including, to the extent necessary, Exchange Notes in
              principal amounts less than $1,000.

                     (ii)   Procedure for Exchange.

                            (A)    At least thirty (30) days and not more than
                     sixty (60) days prior to the date fixed for exchange,
                     written notice (the "Exchange Notice") shall be given by
                     first class mail, postage prepaid, to each Holder of record
                     on the record date fixed for such exchange of the Senior
                     Exchangeable Redeemable Preferred Shares at such Holder's
                     address as the same appears on the share books of the
                     Corporation, provided that no failure to give such notice
                     nor any deficiency therein shall affect the validity of the
                     procedure for the exchange of any Senior Exchangeable
                     Redeemable Preferred Shares to be exchanged except as to
                     the Holder or Holders to whom the Corporation has failed to
                     give said notice or except as to the Holder or Holders
                     whose notice was defective. The Exchange Notice shall
                     state:

                                   (1)    The Exchange Date;

                                   (2)    That the Holder is to surrender to the
                            Corporation, in the manner and at the place or
                            places designated, his certificate or certificates
                            representing the Senior Exchangeable Redeemable
                            Preferred Shares to be exchanged;

                                   (3)    That dividends on the Senior
                            Exchangeable Redeemable Preferred Shares to be
                            exchanged shall cease to accrue on such Exchange
                            Date whether or not certificates for Senior
                            Exchangeable Redeemable Preferred Shares are
                            surrendered for exchange on such Exchange Date
                            unless the Corporation shall default in the delivery
                            of Exchange Notes; and



                                       13
<PAGE>   14


                                   (4)    That interest on the Exchange Notes
                            shall accrue from the Exchange Date whether or not
                            certificates for Senior Exchangeable Redeemable
                            Preferred Shares are surrendered for exchange on
                            such Exchange Date.(B) On or before the Exchange
                            Date, each Holder of Senior Exchangeable Redeemable
                            Preferred Shares shall surrender the certificate or
                            certificates representing such Senior Exchangeable
                            Redeemable Preferred Shares, in the manner and at
                            the place designated in the Exchange Notice. The
                            Corporation shall cause the Exchange Notes to be
                            executed on the Exchange Date and, upon surrender in
                            accordance with the Exchange Notice of the
                            certificates for any Senior Exchangeable Redeemable
                            Preferred Shares so exchanged, duly endorsed (or
                            otherwise in proper form for transfer, as determined
                            by the Corporation), such shares shall be exchanged
                            by the Corporation into Exchange Notes. The
                            Corporation shall pay interest on the Exchange Notes
                            at the rate and on the dates specified therein from
                            the Exchange Date. (C) If notice has been mailed as
                            aforesaid, and if before the Exchange Date specified
                            in such notice (1) the Indenture shall have been
                            duly executed and delivered by the Corporation and
                            the trustee there under and(2) all Exchange Notes
                            necessary for such exchange shall have been duly
                            executed by the Corporation and delivered to the
                            trustee under the Indenture with irrevocable
                            instructions to authenticate the Exchange Notes
                            necessary for such exchange, then the rights of the
                            Holders of Senior Exchangeable Redeemable Preferred
                            Shares so exchanged as shareholders of the
                            Corporation shall cease(except the right to receive
                            Exchange Notes, an amount in cash equal to the
                            amount of accrued and unpaid dividends to the
                            Exchange Date), and the Person or Persons entitled
                            to receive the Exchange Notes issuable upon exchange
                            shall be treated for all purposes as the registered
                            Holder or Holders of such Exchange Notes as of the
                            Exchange Date.

                     (iii)  No Exchange in Certain Cases. Notwithstanding the
              foregoing provisions of this paragraph (g), the Corporation shall
              not be entitled to exchange the Senior Exchangeable Redeemable
              Preferred Shares for Exchange Notes if such exchange, or any term
              or provision of the Indenture or the Exchange Notes, or the
              performance of the Corporation's obligations under the Indenture
              or the Exchange Notes, shall materially violate or conflict with
              any applicable law or if, at the time of such exchange, the
              Corporation is insolvent or if it would be rendered insolvent by
              such exchange.

              (h)    Change of Control.

                     (i)    Within 30 days following a Change of Control (the
              date of such occurrence being the "Change of Control Date"), the
              Corporation shall notify the Holders of the Senior Exchangeable
              Redeemable Preferred Shares in writing of



                                       14
<PAGE>   15


              such occurrence and shall make an Offer to Purchase all of the
              then outstanding Senior Exchangeable Redeemable Preferred Shares
              at a purchase price of 101% of the liquidation preference thereof
              plus, without duplication, an amount in cash equal to all
              accumulated and unpaid dividends per share (including an amount in
              cash equal to a prorated dividend for the period from the Dividend
              Payment Date immediately prior to the Payment Date to the Payment
              Date).

                     (ii)   The Corporation will comply with any securities laws
              and regulations, to the extent such laws and regulations are
              applicable to the repurchase of the Senior Exchangeable Redeemable
              Preferred Shares in connection with an Offer to Purchase.

                     (iii)  On the payment Date the Corporation shall (A) accept
              for payment the Senior Exchangeable Redeemable Preferred Shares
              validly tendered pursuant to the Offer to Purchase, (B) pay to the
              Holders of shares so accepted the purchase price therefor in cash
              and (C) cancel and retire each surrendered certificate. Unless the
              Corporation defaults in the payment for the Senior Exchangeable
              Redeemable Preferred Shares tendered pursuant to the Offer to
              Purchase, dividends will cease to accrue with respect to the
              Senior Exchangeable Redeemable Preferred Shares tendered and all
              rights of Holders of such tendered shares will terminate, except
              for the right to receive payment therefor, on the Payment Date.

                     (iv)   Notwithstanding the foregoing, the Corporation will
              not repurchase or redeem any Senior Exchangeable Redeemable
              Preferred Shares pursuant to the provisions of this paragraph
              prior to the Corporation's repurchase of such Senior Notes as are
              required to be repurchased pursuant to the Existing Indenture.

              (i)    Conversion or Exchange.

The Holders of Senior Exchangeable Redeemable Preferred Shares shall not have
any rights hereunder to convert such shares into or exchange such shares for
shares of any other class or classes or of any other series of any class or
classes of Capital Stock of the Corporation.

              (j)    Reissuance of Senior Exchangeable Redeemable Preferred
                     Shares. Senior Exchangeable Redeemable Preferred Shares
                     that have been issued and reacquired in any manner,
                     including shares purchased or redeemed or exchanged, shall
                     (upon compliance with any applicable provisions of the laws
                     of Delaware) have the status of authorized and unissued
                     shares of Preferred Shares undesignated as to series and
                     may be redesignated and reissued as part of any series of
                     Preferred Shares, including but not limited to reissuance
                     as a stock dividend on the Company's 14% Senior
                     Exchangeable Redeemable Preferred Shares; provided that
                     such reacquired shares shall not otherwise be reissued as
                     Senior Exchangeable Redeemable Preferred Shares.

              (k)    Business Day.



                                       15
<PAGE>   16


If any payment, redemption or exchange shall be required by the terms hereof to
be made on a day that is not a Business Day, such payment, redemption or
exchange shall be made on the immediately succeeding Business Day.

              (l)    Certain Additional Provisions.

                     (i)    Limitation on Consolidated Debt. The Corporation may
              not, and may not permit any Restricted Subsidiary of the
              Corporation to, Incur any Debt unless either (a) the ratio of (i)
              the aggregate consolidated principal amount of Debt of the
              Corporation outstanding as of the most recent available quarterly
              or annual balance sheet, after giving pro forma effect to the
              Incurrence of such Debt and any other Debt Incurred since such
              balance sheet date and the receipt and application of the proceeds
              thereof to (ii) Consolidated Cash Flow Available for Fixed Charges
              for the four full fiscal quarters next preceding the Incurrence of
              such Debt for which consolidated financial statements are
              available, determined on a pro forma basis as if any such Debt had
              been Incurred and the proceeds thereof had been applied at the
              beginning of such four fiscal quarters, would be less than 5.5 to
              1 for such four-quarter periods ending on or prior to December 31,
              1999 and 5.0 to 1 for such periods ending thereafter, or (b) the
              Corporation's Consolidated Capital Ratio as of the most recent
              available quarterly or annual balance sheet, after giving pro
              forma effect to the Incurrence of such Debt and any other Debt
              Incurred since such balance sheet date and the receipt and
              application of the proceeds thereof, is less than 2.0 to 1.
              Notwithstanding the foregoing limitation, the Corporation and any
              Restricted Subsidiary may Incur the following:

                            (A)    Debt under any one or more Bank Credit
                     Agreements or Vendor Financing Facilities in an aggregate
                     principal amount at any one time not to exceed $125
                     million, and any renewal, extension, refinancing or
                     refunding thereof in an amount which, together with any
                     principal amount remaining outstanding or available under
                     all Bank Credit Agreements and Vendor Financing Facilities
                     of the Corporation and its Restricted Subsidiaries, plus
                     the amount of any premium required to be paid in connection
                     with such refinancing pursuant to the terms of any Bank
                     Credit Agreement so refinanced plus the amount of expenses
                     incurred in connection with such refinancing, does not
                     exceed the aggregate principal amount outstanding or
                     available under all such Bank Credit Agreements and Vendor
                     Financing Facilities of the Corporation and its Restricted
                     Subsidiaries immediately prior to such renewal, extension,
                     refinancing or refunding;

                            (B)    Purchase Money Debt Incurred to finance the
                     construction, acquisition or improvement of
                     Telecommunications Assets, provided that the net proceeds
                     of such Purchase Money Debt do not exceed 80% of the cost
                     of construction, acquisition or improvement price of the
                     applicable Telecommunications Assets;



                                       16
<PAGE>   17


                            (C)    Debt owed by the Corporation to any
                     Wholly-Owned Restricted Subsidiary of the Corporation or
                     Debt owed by a Restricted Subsidiary of the Corporation to
                     the Corporation or another Wholly-Owned Subsidiary of the
                     Corporation; provided, however, that upon either (x) the
                     transfer or other disposition by such Wholly-Owned
                     Restricted Subsidiary or the Corporation of any Debt so
                     permitted to a Person other than the Corporation or another
                     Wholly-Owned Restricted Subsidiary of the Corporation or(y)
                     the issuance (other than directors' qualifying shares),
                     sale, lease, transfer or other disposition of shares of
                     Capital Stock(including by consolidation or merger) of such
                     Wholly-Owned Restricted Subsidiary to a Person other than
                     the Corporation or another such Wholly-Owned Restricted
                     Subsidiary, the provisions of this clause (C) shall no
                     longer be applicable to such Debt and such Debt shall be
                     deemed to have been Incurred at the time of such transfer
                     or other disposition;

                            (D)    Debt Incurred to renew, extend, refinance or
                     refund (each, a "refinancing") Debt (1)referred to in
                     clause (F) below or (2)Incurred pursuant to the preceding
                     paragraph or clause (B) of this paragraph in an aggregate
                     principal amount not to exceed the aggregate principal
                     amount of and accrued interest on the Debt so refinanced
                     plus the amount of any premium required to be paid in
                     connection with such refinancing pursuant to the terms of
                     the Debt so refinanced or the amount of any premium
                     reasonably determined by the Corporation as necessary to
                     accomplish such refinancing by means of a tender offer or
                     privately negotiated repurchase, plus the amount of
                     expenses of the Corporation incurred in connection with
                     such refinancing, provided, however, that, the refinancing
                     Debt by its terms, or by the terms of any agreement or
                     instrument pursuant to which such Debt is issued, (x) does
                     not provide for payments of principal of such Debt at the
                     stated maturity thereof or by way of a sinking fund
                     applicable thereto or by way of any mandatory redemption,
                     defeasance, retirement or repurchase thereof by the
                     Corporation (including any redemption, retirement or
                     repurchase which is contingent upon events or
                     circumstances, but excluding any retirement required by
                     virtue of acceleration of such Debt upon any event of
                     default thereunder), in each case prior to the time the
                     same are required by the terms of the Debt being refinanced
                     and (y) does not permit redemption or other
                     retirement(including pursuant to an offer to purchase made
                     by the Corporation) of such Debt at the option of the
                     holder thereof prior to the final stated maturity of the
                     Debt being refinanced, other than a redemption or other
                     retirement at the option of the holder of such Debt
                     (including pursuant to an offer to purchase made by the
                     Corporation) which is conditioned upon a change
                     substantially similar to the provisions of paragraph
                     (h)above or which is pursuant to provisions substantially
                     similar to the provisions of Section 1013 of the Existing
                     Indenture as in effect on the Issue Date (whether or not
                     the Existing Notes are outstanding or the Existing
                     Indenture is in effect);



                                       17
<PAGE>   18


                            (E)    Debt consisting of Permitted Interest Rate
                     and Currency Protection Agreements;

                            (F)    Debt outstanding at the Issue Date;

                            (G)    Subordinated Debt invested by (a) a group of
                     employees of the Corporation, which includes the Chief
                     Executive Officer of the Corporation, who own, directly or
                     indirectly, through an employee stock ownership plan or
                     arrangement, shares of the Corporation's Capital Stock or
                     (b) any other Person that controls the Corporation (i) on
                     the Issue Date or (ii) after a Change of Control, provided
                     that the Corporation is not in default with respect to its
                     obligations under paragraph (h) above;

                            (H)    Debt consisting of performance and other
                     similar bonds and reimbursement obligations Incurred in the
                     ordinary course of business securing the performance of
                     contractual, franchise or license obligations of the
                     Corporation or a Restricted Subsidiary, or in respect of a
                     letter of credit obtained to secure such performance; and

                            (I)    Debt not otherwise permitted to be incurred
                     pursuant to clauses (A) through (H) above, which, together
                     with any other outstanding Debt Incurred pursuant to this
                     clause (I),has an aggregate principal amount (or, in the
                     case of Debt issued at a discount, an accreted amount
                     (determined in accordance with generally accepted
                     accounting principles) at the time of incurrence) not in
                     excess of $10 million at any time outstanding.

                            For purposes of determining compliance with this
                            paragraph (l)(i), in the event that an item of Debt
                            meets the criteria of more than one of the types of
                            Debt the Corporation is permitted to Incur pursuant
                            to the foregoing clauses (A) through (I), the
                            Corporation shall have the right, in its sole
                            discretion, to classify such item of Debt and shall
                            only be required to include the amount and type of
                            such Debt under the clause permitting the Debt as so
                            classified. For purposes of determining any
                            particular amount of Debt under this covenant,
                            Guarantees or Liens with respect to letters of
                            credit supporting Debt otherwise included in the
                            determination of a particular amount shall not be
                            included.

                     (ii)   Reports. So long as any Senior Exchangeable
              Redeemable Preferred Shares are outstanding, the Corporation will
              provide to the holders of Senior Exchangeable Redeemable Preferred
              Shares, within 15 days after it files them with the Securities and
              Exchange Commission (or any successor agency performing similar
              functions), copies of the annual reports and of the information,
              documents and other reports (or copies of such portions of any of
              the foregoing as the Commission may by rules and regulation
              prescribe) which the Corporation files with the Commission
              pursuant to Section 13 or 15(d) of the Exchange Act.



                                       18
<PAGE>   19


              In the event that the Corporation is no longer required to furnish
              such reports to its security holders pursuant to the Exchange Act,
              the Corporation will cause its consolidated financial statements,
              comparable to those which would have been required to appear in
              annual or quarterly reports, to be delivered to the Holders of
              Senior Exchangeable Redeemable Preferred Shares. (m) Definitions.
              As used in this Certificate of Designations, the following terms
              shall have the following meanings (with terms defined in the
              singular having comparable meanings when used in the plural and
              vice versa), unless the context otherwise requires. Any reference
              in any of the following terms to any term in or provision of the
              Existing Indenture shall refer to such term or provision as in
              effect on the Issue Date and as may be amended in accordance with
              the terms of the Existing Indenture (whether or not the Existing
              Notes are outstanding or the Existing Indenture is in effect):

              "Acquired Debt" means, with respect to any specified Person,
(i) Debt of any other Person existing at the time such Person merges with or
into or consolidates with or becomes a Restricted Subsidiary of such specified
Person and (ii) Debt secured by a Lien encumbering any asset acquired by such
specified Person, which Debt was not Incurred in anticipation of, and was
outstanding prior to, such merger, consolidation or acquisition.

              "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

              "Asset Disposition" by any Person means any transfer, conveyance,
sale, lease or other disposition by such Person or any of its Restricted
Subsidiaries (including a consolidation or merger or other sale of any such
Restricted Subsidiary with, into or to another Person in a transaction in which
such Restricted Subsidiary ceases to be a Restricted Subsidiary of the specified
Person, but excluding a disposition by a Restricted Subsidiary of such Person to
such Person or a Wholly-Owned Restricted Subsidiary of such Person or by such
Person to a Wholly-Owned Restricted Subsidiary of such Person) of (i) shares of
Capital Stock or other ownership interests of a Restricted Subsidiary of such
Person (other than as permitted by the provisions of Section 1008 of the
Existing Indenture or pursuant to a transaction in compliance with Section 801
of the Existing Indenture), (ii) substantially all of the assets of such Person
or any of its Restricted Subsidiaries representing a division or line of
business (other than as part of a Permitted Investment (as defined in the
Existing Indenture)) or (iii) other assets or rights of such Person or any of
its Restricted Subsidiaries other than (A) in the ordinary course of business or
(B) that constitutes a Restricted Payment (as defined in the Existing Indenture)
which is permitted by the provisions of Section 1009 of the Existing Indenture;
provided that a transaction described in clause (i), (ii) and (iii) shall
constitute an Asset Disposition only if the aggregate consideration for such
transfer, conveyance, sale, lease or other disposition is equal to $5 million or
more in any 12-month period.

              "Bank Credit Agreement" means any one or more credit agreements
(which may include or consist of revolving credits) between the Corporation or
any Restricted Subsidiary of



                                       19
<PAGE>   20


the Corporation and one or more banks or other financial institutions providing
financing for the business of the Corporation and its Restricted Subsidiaries.

              "Board of Directors" shall have the meaning ascribed to it in the
first paragraph of this Resolution.

              "Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in The Borough of
Manhattan, The City of New York, New York are authorized or obligated by law or
executive order to close.

              "Capital Lease Obligation" of any Person means the obligation to
pay rent or other payment amounts under a lease of (or other Debt arrangements
conveying the right to use) real or personal property of such Person which is
required to be classified and accounted for as a capital lease or a liability on
the face of a balance sheet of such Person in accordance with generally accepted
accounting principles (a "Capital Lease"). The stated maturity of such
obligation shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be terminated
by the lessee without payment of a penalty. The principal amount of such
obligation shall be the capitalized amount thereof that would appear on the face
of a balance sheet of such Person in accordance with generally accepted
accounting principles.

              "Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person.

              "Change of Control" will be deemed to have occurred at such time
as either (a) any Person or any Persons acting together that would constitute a
"group" (a "Group") for purposes of Section 13(d) of the Exchange Act, or any
successor provision thereto (other than Eagle River, Mr. Craig O. McCaw and
their respective Affiliates or an underwriter engaged in a firm commitment
underwriting on behalf of the Corporation), shall beneficially own (within the
meaning of Rule 13d-3 under the Exchange Act, or any successor provision
thereto) more than 50% of the aggregate voting power of all classes of Voting
Stock of the Corporation; (b) neither Mr. Craig O. McCaw nor any person
designated by him to the Corporation as acting on his behalf shall be a director
of the Corporation; or (c) during any period of two consecutive years,
individuals who at the beginning of such period constituted the Board of
Directors (together with any new directors whose election by the Board of
Directors or whose nomination for election by the shareholders of the
Corporation was proposed by a vote of a majority of the directors of the
Corporation then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors then in office.

              "Change of Control Date" shall have the meaning ascribed to it in
paragraph (h)(i) hereof.

              "Consolidated Capital Ratio" of any Person as of any date means
the ratio of (i) the aggregate consolidated principal amount of Debt of such
Person then outstanding to (ii) the



                                       20
<PAGE>   21


aggregate consolidated Capital Stock (other than Disqualified Stock) and paid-in
capital (other than in respect of Disqualified Stock) of such Person as of such
date.

              "Consolidated Cash Flow Available for Fixed Charges" for any
period means the Consolidated Net Income of the Corporation and its Restricted
Subsidiaries for such period increased by the sum of (i) Consolidated Interest
Expense of the Corporation and its Restricted Subsidiaries for such period, plus
(ii) Consolidated Income Tax Expense of the Corporation and its Restricted
Subsidiaries for such period, plus (iii) the consolidated depreciation and
amortization expense included in the income statement of the Corporation and its
Restricted Subsidiaries for such period, plus (iv) any non-cash expense related
to the issuance to employees of the Corporation or any Restricted Subsidiary of
the Corporation of options to purchase Capital Stock of the Corporation or such
Restricted Subsidiary, plus (v) any charge related to any premium or penalty
paid in connection with redeeming or retiring any Debt prior to its stated
maturity; provided, however, that there shall be excluded there from the
Consolidated Cash Flow Available for Fixed Charges (if positive) of any
Restricted Subsidiary of the Corporation (calculated separately for such
Restricted Subsidiary in the same manner as provided above for the Corporation)
that is subject to a restriction which prevents the payment of dividends or the
making of distributions to the Corporation or another Restricted Subsidiary of
the Corporation to the extent of such restriction.

              "Consolidated Income Tax Expense" for any period means the
consolidated provision for income taxes of the Corporation and its Restricted
Subsidiaries for such period calculated on a consolidated basis in accordance
with generally accepted accounting principles.

              "Consolidated Interest Expense" means for any period the
consolidated interest expense included in a consolidated income statement
(excluding interest income) of the Corporation and its Restricted Subsidiaries
for such period calculated on a consolidated basis in accordance with generally
accepted accounting principles, including without limitation or duplication (or,
to the extent not so included, with the addition of), (i) the amortization of
Debt discounts; (ii) any payments or fees with respect to letters of credit,
bankers' acceptances or similar facilities; (iii) fees with respect to interest
rate swap or similar agreements or foreign currency hedge, exchange or similar
agreements; (iv) Preferred Stock dividends of the Corporation and its Restricted
Subsidiaries (other than dividends paid in shares of Preferred Stock that is not
Disqualified Stock) declared and paid or payable; (v) accrued Disqualified Stock
dividends of the Corporation and its Restricted Subsidiaries, whether or not
declared or paid; (vi) interest on Debt guaranteed by the Corporation and its
Restricted Subsidiaries; and (vii) the portion of any Capital Lease Obligation
paid during such period that is allocable to interest expense.

              "Consolidated Net Income" for any period means the consolidated
net income (or loss) of the Corporation and its Restricted Subsidiaries for such
period determined on a consolidated basis in accordance with generally accepted
accounting principles; provided that there shall be excluded there from (i) the
net income (or loss) of any Person acquired by the Corporation or a Restricted
Subsidiary of the Corporation in a pooling-of-interests transaction for any
period prior to the date of such transaction, (ii) the net income (or loss) of
any Person that is not a Restricted Subsidiary of the Corporation except to the
extent of the amount of dividends or other distributions actually paid to the
Corporation or a Restricted Subsidiary of the Corporation



                                       21
<PAGE>   22

by such Person during such period, (iii) gains or losses on Asset Dispositions
by the Corporation or its Restricted Subsidiaries, (iv) all extraordinary gains
and extraordinary losses, (v) the cumulative effect of changes in accounting
principles, (vi) non-cash gains or losses resulting from fluctuations in
currency exchange rates, (vii) any non-cash gain or loss realized on the
termination of any employee pension benefit plan and (viii) the tax effect of
any of the items described in clauses (i) through (vii) above.

              "corporation" means a corporation, association, company, limited
liability company, joint-stock company or business trust.

              "Corporation" means NM Acquisition Corp. a Delaware corporation,
and successor by merger to NETLINK Communications, Inc.

              "Covenant Amendment" means either (i) the defeasance,
extinguishment or amendment of certain covenants of the Existing Indenture that
would cause the Senior Exchangeable Redeemable Preferred Shares to be deemed
Disqualified Stock (under the Existing Indenture) if the provisions of paragraph
(f)(G)(x) and (y) were a part of this Certificate of Designations, and include,
but are not limited to, the definition of Disqualified Stock (under the Existing
Indenture) or (ii) defeasance or extinguishment of the Existing Indenture in its
entirety.

              "Debt" means (without duplication), with respect to any Person,
whether recourse is to all or a portion of the assets of such Person and whether
or not contingent, (i) every obligation of such Person for money borrowed, (ii)
every obligation of such Person evidenced by bonds, debentures, notes or other
similar instruments, including any such obligations Incurred in connection with
the acquisition of property, assets or businesses, (iii) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person, (iv)
every obligation of such Person issued or assumed as the deferred purchase price
of property or services (including securities repurchase agreements but
excluding trade accounts payable or accrued liabilities arising in the ordinary
course of business which are not overdue or which are being contested in good
faith), (v) every Capital Lease Obligation of such Person, (vi) all Receivables
Sales of such Person, together with any obligation of such Person to pay any
discount, interest, fees, indemnities, penalties, recourse, expenses or other
amounts in connection therewith, (vii) all obligations to redeem Disqualified
Stock issued by such Person, (viii) every obligation under Interest Rate and
Currency Protection Agreements of such Person and (ix) every obligation of the
type referred to in clauses (i) through (viii) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has Guaranteed.

              The "amount" or "principal amount" of Debt at any time of
determination as used herein represented by (a) any Debt issued at a price that
is less than the principal amount at maturity thereof, shall be the amount of
the liability in respect thereof determined in accordance with generally
accepted accounting principles, (b) any Receivables Sale, shall be the amount of
the unrecovered capital or principal investment of the purchaser (other than the
Corporation or a Wholly-Owned Restricted Subsidiary of the Corporation) thereof,
excluding amounts representative of yield or interest earned on such investment,
(c) any Disqualified Stock, shall be the maximum fixed redemption or repurchase
price in respect thereof, (d) any Capital Lease Obligation, shall be determined
in accordance with the definition thereof, or (e) any Permitted



                                       22
<PAGE>   23


Interest Rate or Currency Protection Agreement, shall be zero. In no event shall
Debt include any liability for taxes.

              "Disqualified Stock" of any Person means any Capital Stock of such
Person which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to February 1, 2009; provided, however, that
any Preferred Stock which would not constitute Disqualified Stock but for
provisions thereof giving holders thereof the right to require the Corporation
to repurchase or redeem such Preferred Stock upon the occurrence of a Change of
Control occurring prior to February 1, 2009 shall not constitute Disqualified
Stock if the change of control provisions applicable to such Preferred Stock are
no more favorable to the holders of such Preferred Stock than the provisions
contained in paragraph (h) hereof and such Preferred Stock specifically provides
that the Corporation will not repurchase or redeem any such stock pursuant to
such provisions prior to the Corporation's repurchase of such Senior
Exchangeable Redeemable Preferred Shares as are required to be purchased
pursuant to paragraph (h) hereof.

              "Dividend Payment Date" means February 1, May 1, August 1 and
November 1, of each year. "Dividend Period" means the Initial Dividend Period
and, thereafter, each Quarterly Dividend Period. "Dividend Record Date" means
January 15, April 15, July 15 and October 15 of each year. "Eagle River" means
Eagle River Investments, L.L.C., a limited liability company formed under the
laws of the State of Delaware.

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

              "Exchange Date" means the date on which Senior Exchangeable
Redeemable Preferred Shares are exchanged by the Corporation for Exchange Notes.
"Exchange Notes" shall have the meaning ascribed to it in paragraph (g)(i)
hereof.

              "Exchange Notice" shall have the meaning ascribed to it in
paragraph (g)(ii) hereof.

              "Exchange Offer" means the exchange offer contemplated by the
Registration Rights Agreement.

              "Exchange Shares" means any Senior Exchangeable Redeemable
Preferred Shares issued in exchange for an Original Share or Original Shares
pursuant to the Exchange Offer or otherwise registered under the Securities Act
and any Senior Exchangeable Redeemable Preferred Shares with respect to which
the next preceding Predecessor Shares of such Senior Exchangeable Redeemable
Preferred Shares was an Exchange Share, and their Successor Shares.

              "Existing Notes" means the Corporation's $350,000,000 aggregate
principal amount of 12 1/2% Senior Notes due April 15, 2006, as the same may be
modified or amended from time to time.



                                       23
<PAGE>   24


              "Existing Indenture" means the Indenture governing the Existing
Notes as such Indenture may be amended or supplemented from time to time in
accordance with the terms thereof.

              "Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing, or having the economic effect of
guaranteeing, any Debt of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person, (i) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Debt or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such Debt,
(ii) to purchase property, securities or services for the purpose of assuring
the holder of such Debt of the payment of such Debt, or (iii) to maintain
working capital, equity capital or other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Debt (and "Guaranteed", "Guaranteeing" and "Guarantor" shall have meanings
correlative to the foregoing); provided, however, that the Guarantee by any
Person shall not include endorsements by such Person for collection or deposit,
in either case, in the ordinary course of business; and provided, further, that
the incurrence by a Restricted Subsidiary of the Corporation of a lien permitted
under clause (iv) of the second paragraph of Section 1011 of the Existing
Indenture shall not be deemed to constitute a Guarantee by such Restricted
Subsidiary of any Purchase Money Debt of the Corporation secured thereby.

              "Holder" means a holder of Senior Exchangeable Redeemable
Preferred Shares as reflected in the share books of the Corporation.

              "Incur" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Debt or other obligation
including by acquisition of Subsidiaries or the recording, as required pursuant
to generally accepted accounting principles or otherwise, of any such Debt or
other obligation on the balance sheet of such Person (and "Incurrence",
"Incurred", "Incurrable" and "Incurring" shall have meanings correlative to the
foregoing); provided, however, that a change in generally accepted accounting
principles that results in an obligation of such Person that exists at such time
becoming Debt shall not be deemed an Incurrence of such Debt and that neither
the accrual of interest nor the accretion of original issue discount shall be
deemed an Incurrence of Debt; provided, further, however, that the Corporation
may elect to treat all or any portion of revolving credit debt of the
Corporation or a Subsidiary as being incurred from and after any date beginning
the date the revolving credit commitment is extended to the Corporation or a
Subsidiary, by furnishing notice thereof to the Transfer Agent, and any
borrowings or reborrowings by the Corporation or a Subsidiary under such
commitment up to the amount of such commitment designated by the Corporation as
Incurred shall not be deemed to be new Incurrences of Debt by the Corporation or
such Subsidiary.

              "Initial Dividend Period" means the dividend period commencing on
the Issue Date and ending on the first Dividend Payment Date to occur
thereafter. "Initial Purchaser" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated or Toronto Dominion Securities (USA) Inc.



                                       24
<PAGE>   25


              "Interest Rate or Currency Protection Agreement" of any Person
means any forward contract, futures contract, swap, option or other financial
agreement or arrangement (including, without limitation, caps, floors, collars
and similar agreements) relating to, or the value of which is dependent upon,
interest rates or currency exchange rates or indices.

              "Investment" by any Person means any direct or indirect loan,
advance or other extension of credit or capital contribution (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise) to, or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Debt issued by, any other Person, including any payment on a
Guarantee of any obligation of such other Person, but excluding any loan,
advance or extension of credit to an employee of the Corporation or any of its
Restricted Subsidiaries in the ordinary course of business, accounts receivable
and other commercially reasonable extensions of trade credit.

              "Issue Date" means the date of original issuance of the Senior
Exchangeable Redeemable Preferred Shares by NEXTLINK.

              "Joint Venture" means a corporation, partnership or other entity
engaged in one or more Telecommunications Businesses as to which the Corporation
(directly or through one or more Restricted Subsidiaries) exercises managerial
control and in which the Corporation owns (i) a 50% or greater interest, or (ii)
a 40% or greater interest, together with options or other contractual rights,
exercisable not more than seven years after the Corporation's initial Investment
in such Joint Venture, to increase its interest to not less than 50%.

              "Junior Shares" shall have the meaning ascribed to it in
paragraph (b) hereof.

              "Lien" means, with respect to any property or assets, any mortgage
or deed of trust, pledge, hypothecation, assignment, Receivables Sale, deposit
arrangement, security interest, lien, charge, easement (other than any easement
not materially impairing usefulness or marketability), encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including,
without limitation, any conditional sale or other title retention agreement
having substantially the same economic effect as any of the foregoing).

              "Mandatory Redemption Price" shall have the meaning ascribed to it
in paragraph (e)(ii) hereof.

              "Merger Date" means the date of effectiveness of the merger of
NEXTLINK with and into the Corporation.

              "NEXTLINK" means NEXTLINK Communications, Inc., a Delaware
corporation and a predecessor to the Corporation.

              "Offer to Purchase" means a written offer (the "Offer") sent by
the Corporation by first class mail, postage prepaid, to each Holder at his
address appearing in the records of the Corporation on the date of the Offer
offering to purchase any and all of the Senior Exchangeable Redeemable Preferred
Shares at the purchase price specified in such Offer (as determined pursuant to
this Certificate of Designations). Unless otherwise required by applicable law,
the



                                       25
<PAGE>   26


Offer shall specify an expiration date (the "Expiration Date") of the Offer to
Purchase which shall be, subject to any contrary requirements of applicable law,
not less than 30 days or more than 60 days after the date of such Offer and a
settlement date (the "Payment Date") for purchase of Senior Exchangeable
Redeemable Preferred Shares within five Business Days after the Expiration Date.
The Corporation shall notify the Transfer Agent at least 15 Business Days (or
such shorter period as is acceptable to the Transfer Agent) prior to the mailing
of the Offer of the Corporation's obligation to make an Offer to Purchase, and
the Offer shall be mailed by the Corporation or, at the Corporation's request,
by the Transfer Agent in the name and at the expense of the Corporation. The
Offer shall contain information concerning the business of the Corporation and
its Subsidiaries which the Corporation in good faith believes will enable such
Holders to make an informed decision with respect to the Offer to Purchase
(which at a minimum will include (i) the most recent annual and quarterly
financial statements and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" contained in the documents required to be
filed with the Securities and Exchange Commission or provided to the Transfer
Agent pursuant to this Certificate of Designations (which requirements may be
satisfied by delivery of such documents together with the Offer), (ii) a
description of material developments in the Corporation's business subsequent to
the date of the latest of such financial statements referred to in clause (i)
(including a description of the events requiring the Corporation to make the
Offer to Purchase), (iii) if applicable, appropriate pro forma financial
information concerning the Offer to Purchase and the events requiring the
Corporation to make the Offer to Purchase and (iv) any other information
required by applicable law to be included therein). The Offer shall contain all
instructions and materials necessary to enable such Holders to tender Senior
Exchangeable Redeemable Preferred Shares pursuant to the Offer to Purchase. The
Offer shall also state:

                     (a)    the paragraph of this Certificate of Designations
                            pursuant to which the Offer to Purchase is being
                            made;

                     (b)    the Expiration Date and the Payment Date;

                     (c)    the purchase price to be paid by the Corporation for
                            each Senior Exchangeable Redeemable Preferred Shares
                            accepted for payment (as specified pursuant to this
                            Certificate of Designations) (the "Purchase Price");

                     (d)    that the Holder may tender all or any portion of the
                            Senior Exchangeable Redeemable Preferred Shares
                            registered in the name of such Holder;

                     (e)    the place or places where Senior Exchangeable
                            Redeemable Preferred Shares are to be surrendered
                            for tender pursuant to the Offer to Purchase;

                     (f)    that dividends on any Senior Exchangeable Redeemable
                            Preferred Share not tendered or tendered but not
                            purchased by the Corporation pursuant to the Offer
                            to Purchase will continue to accrue;



                                       26
<PAGE>   27


                     (g)    that on the Payment Date the Purchase Price will
                            become due and payable upon each Senior Exchangeable
                            Redeemable Preferred Share being accepted for
                            payment pursuant to the Offer to Purchase and that
                            dividends thereon shall cease to accrue on and after
                            the Purchase Date;

                     (h)    that each Holder electing to tender a Senior
                            Exchangeable Redeemable Preferred Share pursuant to
                            the Offer to Purchase will be required to surrender
                            such Senior Exchangeable Redeemable Preferred Share
                            at the place or places specified in the Offer prior
                            to the close of business on the Expiration Date
                            (such Senior Exchangeable Redeemable Preferred Share
                            being, if the Corporation or the Transfer Agent so
                            requires, duly endorsed by, or accompanied by a
                            written instrument of transfer in form satisfactory
                            to the Corporation and the Transfer Agent duly
                            executed by, the Holder there of or his attorney
                            duly authorized in writing);

                     (i)    that Holders will be entitled to withdraw all or any
                            portion of Senior Exchangeable Redeemable Preferred
                            Shares tendered if the Corporation (or its paying
                            agent) receives not later than the close of business
                            on the Expiration Date, a telegram, telex, facsimile
                            transmission or letter setting forth the name of the
                            Holder, the number of the Senior Exchangeable
                            Redeemable Preferred Shares the Holder tendered, the
                            certificate number(s) of the Senior Exchangeable
                            Redeemable Preferred Shares the Holder tendered and
                            a statement that such Holder is withdrawing all or a
                            portion of his tender;

                     (j)    that the Corporation shall purchase all Senior
                            Exchangeable Redeemable Preferred Shares tendered;

                     (k)    that in the case of any Holder whose Senior
                            Exchangeable Redeemable Preferred Shares is
                            purchased only in part, the Corporation shall issue
                            and deliver to the Holder of such Senior
                            Exchangeable Redeemable Preferred Share without
                            service charge, a new Senior Exchangeable Redeemable
                            Preferred Share or Senior Exchangeable Redeemable
                            Preferred Share as requested by such Holder; and

                     (l)    the CUSIP number or numbers of the Senior
                            Exchangeable Redeemable Preferred Shares offered to
                            be purchased by the Corporation pursuant to the
                            Offer to Purchase. Any Offer to Purchase shall be
                            governed by and effected in accordance with the
                            Offer for such Offer to Purchase.



                                       27
<PAGE>   28


              "Officers' Certificate" means a certificate signed by (i) the
Chief Executive Officer, President, an Executive Vice President or a Vice
President, and (ii) the Treasurer, Assistant Treasurer, Secretary or an
Assistant Secretary, of the Corporation and delivered to the Transfer Agent and
containing the following:

                     (a)    a statement that each individual signing such
                            certificate has read such covenant or condition and
                            the definitions herein relating thereto;

                     (b)    a brief statement as to the nature and scope of the
                            examination or investigation upon which the
                            statements or opinions contained in such certificate
                            or opinion are based;

                     (c)    a statement that, in the opinion of each such
                            individual, he has made such examination or
                            investigation as is necessary to enable him to
                            express an informed opinion as to whether or not
                            such covenant or condition has been complied with;
                            and

                     (d)    a statement as to whether, in the opinion of each
                            such individual, such condition or covenant has been
                            complied with. "Opinion of Counsel" means a written
                            opinion of legal counsel, who may be counsel for the
                            Corporation and containing the following statements:

                            (1)    a statement that such counsel has read such
                                   covenant or condition and the definitions
                                   herein relating thereto;

                            (2)    a brief statement as to the nature and scope
                                   of the examination or investigation upon
                                   which the statements or opinions contained in
                                   such certificate or opinion are based;

                            (3)    a statement that, in the opinion of each such
                                   individual, he has made such examination or
                                   investigation as is necessary to enable him
                                   to express an informed opinion as to whether
                                   or not such covenant or condition has been
                                   complied with; and

                            (4)    a statement as to whether, in the opinion of
                                   each such individual, such condition or
                                   covenant has been complied with.

              "Original Shares" means Senior Exchangeable Redeemable Preferred
Shares that are not Exchange Shares.

              "Parity Shares" shall have the meaning ascribed to it in paragraph
(b) hereof.

              "Payment Date" shall have the meaning ascribed to it in the
definition of Offer to Purchase.



                                       28
<PAGE>   29


              "Permitted Interest Rate or Currency Protection Agreement" of any
Person means any Interest Rate or Currency Protection Agreement entered into
with one or more financial institutions in the ordinary course of business that
is designed to protect such Person against fluctuations in interest rates or
currency exchange rates with respect to Debt Incurred and which shall have a
notional amount no greater than the payments due with respect to the Debt being
hedged thereby and not for purposes of speculation.

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

              "Predecessor Share" of any particular Senior Exchangeable
Redeemable Preferred Share means every previous Senior Exchangeable Redeemable
Preferred Share issued before, and evidencing all or a portion of the same
interest as that evidenced by, such particular Senior Exchangeable Redeemable
Preferred Share; and, for the purposes of this definition, any Senior
Exchangeable Redeemable Preferred Share issued and delivered in exchange for or
in lieu of a mutilated, destroyed, lost or stolen Senior Exchangeable Redeemable
Preferred Share shall be deemed to evidence the same interest as the mutilated,
destroyed, lost or stolen Senior Exchangeable Redeemable Preferred Share.

              "Preferred Stock" of any Person means Capital Stock of such Person
of any class or classes (however designated) that ranks prior, as to the payment
of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of
Capital Stock of any other class of such Person.

              "Public Equity Offering" means a underwritten public offering of
common stock, par value $.02 per share, of the Corporation pursuant to an
effective registration statement filed with the Securities and Exchange
Commission in accordance with the Securities Act.

              "Purchase Money Debt" means (i) Acquired Debt Incurred in
connection with the acquisition of Telecommunications Assets and (ii) Debt of
the Corporation or of any Restricted Subsidiary of the Corporation (including,
without limitation, Debt represented by Capital Lease Obligations, Vendor
Financing Facilities, mortgage financings and purchase money obligations)
Incurred for the purpose of financing all or any part of the cost of
construction, acquisition or improvement by the Corporation or any Restricted
Subsidiary of the Corporation or any Joint Venture of any Telecommunications
Assets of the Corporation, any Restricted Subsidiary of the Corporation or any
Joint Venture, and including any related notes, Guarantees, collateral
documents, instruments and agreements executed in connection therewith, as the
same may be amended, supplemented, modified or restated from time to time.

              "Qualified Junior Shares" shall mean Junior Shares that do not
constitute Disqualified Stock.

              "Qualifying Event" means a Public Equity Offering or one or more
Strategic Equity Investments which in either case results in aggregate net
proceeds to the Corporation of not less than $75 million.



                                       29
<PAGE>   30


              "Quarterly Dividend Period" shall mean the quarterly period
commencing on each February 1, May 1, August 1 and November 1 and ending on the
next succeeding Dividend Payment Date, respectively.

"Receivables" means receivables, chattel paper, instruments, documents or
intangibles evidencing or relating to the right to payment of money in respect
of the sale of goods or services.

              "Receivables Sale" of any Person means any sale of Receivables of
such Person (pursuant to a purchase facility or otherwise), other than in
connection with a disposition of the business operations of such Person relating
thereto or a disposition of defaulted Receivables for purpose of collection and
not as a financing arrangement.

              "Redemption Date", with respect to any Senior Exchangeable
Redeemable Preferred Shares, means the date on which such Senior Exchangeable
Redeemable Preferred Shares are redeemed by the Corporation.

              "Redemption Notice" shall have the meaning ascribed to it in
paragraph (e) hereof.

              "Restricted Subsidiary" of the Corporation means any Subsidiary,
whether existing on or after the date of this Certificate of Designations,
unless such Subsidiary is an Unrestricted Subsidiary.

              "Registration Rights Agreement" means that certain Preferred
Exchange and Registration Rights Agreement, dated as of January 31, 1997, by and
between the Corporation and Merrill Lynch, Pierce, Fenner & Smith Incorporated
and Toronto Dominion Securities (USA) Inc.

              "Senior Exchangeable Redeemable Preferred Shares" shall have the
meaning ascribed to it in paragraph (a) hereof.

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

              "Senior Shares" shall have the meaning ascribed to it in paragraph
(b) hereof.

              "Strategic Equity Investment" means an investment in Qualified
Junior Shares made by a Strategic Investor in an aggregate amount of not less
than $25 million.

              "Strategic Investor" means a Person engaged in one or more
Telecommunications Businesses (which need not be such Person's primary business)
that has, or 80% or more of the Voting Stock of which is owned, directly or
indirectly, by a Person that has, an equity market capitalization or net worth,
at the time of its initial investment in the Corporation, in excess of $2.0
billion.

              "Subordinated Debt" means Debt of the Corporation as to which the
payment of principal of (and premium, if any) and interest and other payment
obligations in respect of such



                                       30
<PAGE>   31


Debt shall be subordinate to the prior payment in full of the Exchange Notes, or
the Existing Notes if the Exchange Notes have not yet been issued, to at least
the following extent: (i) no payments of principal of (or premium, if any) or
interest on or otherwise due in respect of such Debt may be permitted for so
long as any default in the payment of principal (or premium, if any) or interest
on the Exchange Notes or Existing Notes, as applicable, exists; (ii) in the
event that any other default that with the passing of time or the giving of
notice, or both, would constitute an Event of Default exists with respect to the
Exchange Notes or the Existing Notes, as applicable, upon notice by 25% or more
in principal amount of the Exchange Notes or the Existing Notes, as applicable,
to the relevant trustee, the relevant trustee shall have the right to give
notice to the Corporation and the holders of such Debt (or trustees or agents
therefor) of a payment blockage, and thereafter no payments of principal of (or
premium, if any) or interest on or otherwise due in respect of such Debt may be
made for a period of 179 days from the date of such notice or for the period
until such default has been cured or waived or ceased to exist and any
acceleration of the Exchange Notes or the Existing Notes, as applicable, has
been rescinded or annulled, whichever period is shorter (which Debt may provide
(A) no new period of payment blockage may be commenced by a payment blockage
notice unless and until 360 days have elapsed since the effectiveness of the
immediately prior notice, (B) no nonpayment default that existed or was
continuing on the date of delivery of any payment blockage notice to such
holders (or such agents or trustees) shall be, or be made, the basis for a
subsequent payment blockage notice and (C) failure of the Corporation to make
payment on such Debt when due or within any applicable grace period, whether or
not on account of such payment blockage provisions, shall constitute an event of
default thereunder); and (iii) such Debt may not (x) provide for payments of
principal of such Debt at the stated maturity thereof or by way of a sinking
fund applicable thereto or by way of any mandatory redemption, defeasance,
retirement or repurchase thereof by the Corporation (including any redemption,
retirement or repurchase which is contingent upon events or circumstances, but
excluding any retirement required by virtue of acceleration of such Debt upon an
event of default thereunder), in each case prior to the final Stated Maturity
(as defined in the Existing Indenture) of the Exchange Notes or the Existing
Notes, as applicable, or (y) permit redemption or other retirement (including
pursuant to an offer to purchase made by the Corporation) of such other Debt at
the option of the holder thereof prior to the final Stated Maturity (as defined
in the Existing Indenture) of the Exchange Notes or the Existing Notes, as
applicable, other than a redemption or other retirement at the option of the
holder of such Debt (including pursuant to an offer to purchase made by the
Corporation) which is conditioned upon a change of control of the Corporation
pursuant to provisions substantially similar to those contained in paragraph (h)
hereof (and which shall provide that such Debt will not be repurchased pursuant
to such provisions prior to the Corporation's repurchase of the Exchange Notes
or the Existing Notes, as applicable, required to be repurchased by the
Corporation pursuant to the provisions of Section 1016 of the Existing Indenture
or Section 1016 of the Indenture, as applicable. "Subsidiary" of any Person
means (i) a corporation more than 50% of the combined voting power of the
outstanding Voting Stock of which is owned, directly or indirectly, by such
Person or by one or more other Subsidiaries of such Person or by such Person and
one or more Subsidiaries thereof or (ii) any other Person (other than a
corporation) in which such Person, or one or more other Subsidiaries of such
Person or such Person and one or more other Subsidiaries thereof, directly or
indirectly, has at least a majority ownership and power to direct the policies,
management and affairs thereof. "Successor Share" of any particular Senior
Exchangeable Redeemable Preferred Share means every Senior Exchangeable
Redeemable



                                       31
<PAGE>   32


Preferred Share issued after, and evidencing all or a portion of the same
interest as that evidenced by, such particular Senior Exchangeable Redeemable
Preferred Share; and, for the purposes of this definition, any Senior
Exchangeable Redeemable Preferred Share issued and delivered in exchange for or
in lieu of a mutilated, destroyed, lost or stolen Senior Exchangeable Redeemable
Preferred Share shall be deemed to evidence the same interest as the mutilated,
destroyed, lost or stolen Senior Exchangeable Redeemable Preferred Share.
"Telecommunications Assets" means all assets, rights (contractual or otherwise)
and properties, whether tangible or intangible, used or intended for use in
connection with a Telecommunications Business.

              "Telecommunications Business" means the business of (i)
transmitting, or providing services relating to the transmission of, voice,
video or data through owned or leased transmission facilities, (ii) creating,
developing or marketing communications related network equipment, software and
other devices for use in a Telecommunication Business or (iii) evaluating,
participating or pursuing any other activity or opportunity that is primarily
related to those identified in (i) or (ii) above and shall, in any event,
include all businesses in which the Corporation or any of its Subsidiaries are
engaged on the Issue Date; provided that the determination of what constitutes a
Telecommunications Business shall be made in good faith by the Board of
Directors of the Corporation, which determination shall be conclusive.

              "Transfer Agent" means the transfer agent for the Senior
Exchangeable Redeemable Preferred Shares designated by the Corporation from time
to time.

              "Unrestricted Subsidiary" means (1) any Subsidiary of the
Corporation designated as such by the Board of Directors as set forth below
where (a) neither the Corporation nor any of its other Subsidiaries (other than
another Unrestricted Subsidiary) (i) provides credit support for, or Guarantee
of, any Debt of such Subsidiary or any Subsidiary of such Subsidiary (including
any undertaking, agreement or instrument evidencing such Debt) or (ii) is
directly or indirectly liable for any Debt of such Subsidiary or any Subsidiary
of such Subsidiary, and (b) no default with respect to any Debt of such
Subsidiary or any Subsidiary of such Subsidiary (including any right which the
holders thereof may have to take enforcement action against such Subsidiary)
would permit (upon notice, lapse of time or both) any holder of any other Debt
of the Corporation and its Restricted Subsidiaries to declare a default on such
other Debt or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity and (2) any Subsidiary of an Unrestricted
Subsidiary.

              The Board of Directors may designate any Subsidiary to be an
Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, any other Subsidiary of the
Corporation which is not a Subsidiary of the Subsidiary to be so designated or
otherwise an Unrestricted Subsidiary, provided that either (x) the Subsidiary to
be so designated has total assets of $1,000 or less or (y) immediately after
giving effect to such designation, the Corporation could incur at least $1.00 of
additional Debt pursuant to paragraph (l)(i) hereof.

              The Board of Directors may designate any Unrestricted Subsidiary
to be a Restricted Subsidiary, provided that, immediately after giving effect to
such designation, the Corporation could incur at least $1.00 of additional Debt
pursuant to the paragraph (l)(i) hereof.



                                       32
<PAGE>   33


              "Vendor Financing Facility" means any agreements between the
Corporation or a Restricted Subsidiary of the Corporation and one or more
vendors or lessors of equipment to the Corporation or any of its Restricted
Subsidiaries (or any affiliate of any such vendor or lessor) providing financing
for the acquisition by the Corporation or any such Restricted Subsidiary of
equipment from any such vendor or lessor.

              "Vice President", when used with respect to the Corporation means
any vice president, whether or not designated by a number or a word or words
added before or after the title "vice president".

              "Voting Stock" of any Person means Capital Stock of such Person
which ordinarily has voting power for the election of directors (or persons
performing similar functions) of such Person, whether at all times or only so
long as no senior class of securities has such voting power by reason of any
contingency.

              "Voting Rights Triggering Event" shall have the meaning ascribed
to it in paragraph (f)(iv) hereof.

              "Wholly-Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person 99% or more of the outstanding Capital
Stock or other ownership interests of which (other than directors' qualifying
shares) shall at the time be owned by such Person or by one or more Wholly-Owned
Restricted Subsidiaries of such Person or by such Person and one or more
Wholly-Owned Restricted Subsidiaries of such Person.

              (m)    Restrictions on Transfer.

                     (i)    Each Original Share shall contain a legend
              substantially to the following effect until the Resale Restriction
              Termination Date (as defined below) unless the Corporation
              determines otherwise:

                     THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
                     SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
                     OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
                     INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
                     ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
                     DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
                     SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
                     REGISTRATION AND SUBJECT TO COMPLIANCE WITH OTHER
                     APPLICABLE LAWS. THE HOLDER OF THIS SECURITY BY ITS
                     ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHER WISE
                     TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS THREE
                     YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND
                     THE LAST DATE ON WHICH THE CORPORATION OR ANY AFFILIATE OF
                     THE CORPORATION WAS THE OWNER OF THIS SECURITY (OR ANY
                     PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION



                                       33
<PAGE>   34


                     TERMINATION DATE"), ONLY (A) TO THE CORPORATION; (B)
                     PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
                     DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
                     LONG AS THESE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT
                     TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A
                     PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
                     BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN
                     ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
                     BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
                     MADE IN RELIANCE ON RULE 144A, (D)PURSUANT TO AN EXEMPTION
                     FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE
                     144, (E) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
                     THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
                     REGULATION S UNDER THE SECURITIES ACT OR (F)IN THE CASE OF
                     EITHER ANY INITIAL INVESTOR THAT IS A QUALIFIED
                     INSTITUTIONAL BUYER OR ANY SUBSEQUENT INVESTOR, TO AN
                     INSTITUTIONAL" ACCREDITED INVESTOR" WITHIN THE MEANING OF
                     SUBPARAGRAPH (a)(1), (2), (3) or (7) OF RULE 501 UNDER THE
                     SECURITIES ACT PURSUANT TO AN EXEMPTION FROM REGISTRATION
                     UNDER THE SECURITIES ACT (IF AVAILABLE), AND OTHER WISE IN
                     COMPLIANCE WITH OTHER APPLICABLE LAWS, SUBJECT TO THE
                     CORPORATION'S AND THE TRANSFER AGENT AND REGISTRAR'S RIGHT
                     PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
                     CLAUSE (C), (D),(E) OR (F) TO REQUIRE THE DELIVERY OF A
                     TRANSFER CERTIFICATE AND IN THE CASE OF CLAUSE (F) AN
                     OPINION OF COUNSEL OR OTHER INFORMATION SATISFACTORY TO
                     EACH OF THEM. THE LEGEND WILL BE REMOVED UPON THE REQUEST
                     OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

                     (ii)   If prior to the Resale Restriction Termination Date
              (or such shorter period as may be prescribed by Rule 144(k) under
              the Securities Act (or any successor thereto)) a Holder of
              Original Shares that acquired Senior Exchangeable Redeemable
              Preferred Shares from an Initial Purchaser in a sale that was not
              made in reliance upon Rule 144A under the Securities Act wishes to
              transfer such Original Shares, such transfer may be effected only
              upon receipt by the Corporation or the Transfer Agent of a
              certificate substantially in the form of Exhibit A hereto duly
              executed by such Holder or his attorney duly authorized in
              writing.



                                       34
<PAGE>   35


              IN WITNESS WHEREOF, said NM Acquisition Corp. has caused this
Certificate of Designation to be signed by Gary D. Begeman, its Vice President,
this 16th day of June, 2000.

                                   NM ACQUISITION CORP.


                                   By: /s/ Gary D. Begeman
                                      ------------------------------------------
                                      Name:  Gary D. Begeman
                                      Title:  Vice President



                                       35