##### Table of Contents



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UNITED STATES
  SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

|    |  |                                                                                                        
|--- |  | -------------------------------------------------------------------------------------------------------
|[X] |  | QUARTERLY REPORT PURSUANT TO SECTION
        13 OR 15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

OR

|      |  |                                                                                                         
|----- |  | --------------------------------------------------------------------------------------------------------
|[   ] |  | TRANSITION REPORT PURSUANT TO SECTION
        13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 000-31689

ASIA GLOBAL CROSSING LTD.
  (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

|                                                                                           |  |                                                           
|------------------------------------------------------------------------------------------ |  | ----------------------------------------------------------
|BERMUDA
          (STATE OR OTHER JURISDICTION OF
          INCORPORATION OR ORGANIZATION) |  | 98-022-4159
          (I.R.S. EMPLOYER IDENTIFICATION NO.)

WESSEX HOUSE
  45 REID STREET
  HAMILTON HM12, BERMUDA
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

(441) 296-8600
  (REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE)

Indicate by check mark whether the registrant
  (1) has filed all reports required to be filed by Section 13 or 15(d)
  of the Securities Exchange Act of 1934 during the preceding 12 months (or
  for such shorter period that the registrant was required to file such reports),
  and (2) has been subject to such filing requirements for the past 90 days.
  Yes [X] No [   ]

The number of shares of the Registrants
  Class A common stock, par value $0.01 per share, outstanding as of May 10,
  2001, was 68,500,000 and Class B common stock, par value $0.01 per share,
  was 486,625,125.

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TABLE OF CONTENTS



|                              |                                                                                               |  |  |  |  |  |  | 
|----------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I. FINANCIAL INFORMATION
|                              | ITEM 1. FINANCIAL STATEMENTS                                                                 
|                              | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
|                              | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                           
|PART II. OTHER INFORMATION   
|                              | Item 1. Legal Proceedings                                                                    
|                              | Item 2. Changes in Securities and Use of Proceeds                                            
|                              | Item 3. Defaults Upon Senior Securities                                                      
|                              | Item 4. Submission of Matters to a Vote of Security Holders                                  
|                              | Item 5. Other Information                                                                    
|                              | Item 6. Exhibits And Reports On Form 8-K                                                     
|SIGNATURE                    



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES

FOR THE QUARTER ENDED MARCH 31, 2001

INDEX

|                              |  |  |                                                                                                 |                                                                     |  |  |      |   | 
|----------------------------- |  |  | ----------------------------------------------------------------------------------------------- | ------------------------------------------------------------------- |  |  | ---- | - | 
|                              |  |  |                                                                                                 |                                                                     |  |  | Page
|                              |  |  |                                                                                                 |                                                                     |  |  |     
|PART I. FINANCIAL INFORMATION
|                              |  |  |                                                                                                 |                                                                    
|Item 1.                       |  |  | Financial Statements:                                                                           |                                                                    
|                             
|                             
|                             
|                             
|                              |  |  |                                                                                                 | Condensed Consolidated Balance Sheets                               |  |  |      | 3 | 
|                             
|                             
|                             
|                             
|                              |  |  |                                                                                                 | Condensed Consolidated Statements of
          Operations           |  |  |      | 4 | 
|                             
|                             
|                             
|                             
|                              |  |  |                                                                                                 | Condensed Consolidated Statements of
          Cash Flows           |  |  |      | 5 | 
|                             
|                             
|                             
|                             
|                              |  |  |                                                                                                 | Condensed Consolidated Statements of
          Comprehensive Income |  |  |      | 6 | 
|                             
|                             
|                             
|                             
|                              |  |  |                                                                                                 | Notes to Condensed Consolidated Financial
          Statements      |  |  |      | 7 | 
|                             
|                             
|                             
|                             
|Item 2.                       |  |  | Management's Discussion and Analysis
          of Financial Condition and Results of Operations |                                                                     |  |  | 11   |  
|                             
|                             
|                             
|                             
|Item 3.                       |  |  | Quantitative and Qualitative Disclosures
          about Market Risk                            |                                                                     |  |  | 16   |  
|                             
|                             
|                             
|                             
|                             
|PART II. OTHER INFORMATION   
|                              |  |  |                                                                                                 |                                                                     |  |  |      |  
|Item 1.                       |  |  | Legal Proceedings                                                                               |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|Item 2.                       |  |  | Changes in Securities and Use of Proceeds                                                       |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|Item 3.                       |  |  | Defaults Upon Senior Securities                                                                 |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|Item 4.                       |  |  | Submission of Matters to A Vote of Security
          Holders                                   |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|Item 5.                       |  |  | Other Information                                                                               |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|Item 6.                       |  |  | Exhibits and Reports on Form 8-K                                                                |                                                                     |  |  | 18   |  
|                             
|                             
|                             
|                             
|                              |  |  | Signature                                                                                       |                                                                     |  |  | 19   |  

2



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##### Table of Contents









PART I. FINANCIAL INFORMATION







ITEM 1. FINANCIAL STATEMENTS

ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  CONDENSED CONSOLIDATED BALANCE SHEETS
  (In thousands, except share and per share information)

|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |           |         |           | 
|------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------- | ---------------------------------------------------- | --------- | ----------- | --------- | ------------ | --------- | ------- | --------- | 
|                                |                                                                                                                                                 |                                                    |                                                      |           | March 31,   |           | December 31,
|                                |                                                                                                                                                 |                                                    |                                                      |           | 2001        |           | 2000        
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |             
|                                |                                                                                                                                                 |                                                    |                                                      |           | (Unaudited)
|ASSETS:                        
|                               
|                               
|                               
|                               
|                                | Current
          assets:                                                                                                                      
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Cash and
          cash equivalents                |                                                      | $         | 644,608     |           |              | $         | 705,161 |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Restricted
          cash and cash equivalents     |                                                      |           | 138,914     |           |              |           | 145,862 |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Accounts
          receivable, net                 |                                                      |           | 3,051       |           |              |           | 12,066  |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Receivable
          from affiliates               |                                                      |           | 137,518     |           |              |           | 108,720 |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Other
          assets and prepaid costs           |                                                      |           | 13,058      |           |              |           | 10,921  |          
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          current assets                       |           |             | 937,149   |              |           |         | 982,730   | 
|                               
|                               
|                               
|                               
|                                | Property
          and equipment, net                                                                                                           |                                                    |                                                      | 2,188,435 |             |           |              | 1,914,018 |        
|                               
|                               
|                               
|                               
|                                | Deferred
          finance fees, net                                                                                                            |                                                    |                                                      | 34,931    |             |           |              | 37,090    |        
|                               
|                               
|                               
|                               
|                                | Other
          assets                                                                                                                          |                                                    |                                                      | 34,940    |             |           |              | 38,023    |        
|                               
|                               
|                               
|                               
|                                | Loans
          receivable from affiliate                                                                                                       |                                                    |                                                      | 39,725    |             |           |              | 40,049    |        
|                               
|                               
|                               
|                               
|                                | Investments
          in affiliates                                                                                                             |                                                    |                                                      | 607,329   |             |           |              | 620,628   |        
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          assets                               |           | $           | 3,842,509 |              |           | $       | 3,632,538 | 
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|LIABILITIES:                   
|                               
|                               
|                               
|                               
|                                | Current
          liabilities:                                                                                                                 
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Accrued
          construction costs               |                                                      | $         | 204,373     |           |              | $         | 168,286 |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Accounts
          payable and accrued liabilities |                                                      |           | 45,507      |           |              |           | 26,450  |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Current
          portion of long-term debt        |                                                      |           | 41,630      |           |              |           | 41,630  |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Deferred
          revenue                         |                                                      |           | 11,211      |           |              |           | 6,602   |          
|                               
|                               
|                               
|                               
|                                |                                                                                                                                                 | Income
          taxes payable                     |                                                      |           | 10,598      |           |              |           | 8,161   |          
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          current liabilities                  |           |             | 313,319   |              |           |         | 251,129   | 
|                               
|                               
|                               
|                               
|                                | Long-term
          debt                                                                                                                        |                                                    |                                                      | 1,117,841 |             |           |              | 1,159,704 |        
|                               
|                               
|                               
|                               
|                                | Deferred
          revenue                                                                                                                      |                                                    |                                                      | 543,265   |             |           |              | 282,443   |        
|                               
|                               
|                               
|                               
|                                | Other
          long-term liabilities                                                                                                           |                                                    |                                                      | 2,674     |             |           |              | 2,825     |        
|                               
|                               
|                               
|                               
|                                | Loans
          payable to affiliate                                                                                                            |                                                    |                                                      | 9,882     |             |           |              | 9,993     |        
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          liabilities                          |           |             | 1,986,981 |              |           |         | 1,706,094 | 
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|MINORITY
          INTEREST     |                                                                                                                                                 |                                                    | 157,218                                              |           |             |           | 162,720      |          
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|SHAREHOLDERS
          EQUITY:
|                               
|                               
|                               
|                               
|                                | Preferred
          stock, par value $0.01 per share, 120,000,000 shares authorized; no
          shares issued and outstanding                 |                                                    |                                                      |          |             |           |              |          |        
|                               
|                               
|                               
|                               
|                                | Class A
          common stock, par value $0.01 per share, 1,200,000,000 shares authorized;
          68,500,000 shares issued and outstanding  |                                                    |                                                      | 685       |             |           |              | 685       |        
|                               
|                               
|                               
|                               
|                                | Class B
          common stock, par value $0.01 per share, 1,200,000,000 shares authorized;
          486,625,125 shares issued and outstanding |                                                    |                                                      | 4,866     |             |           |              | 4,866     |        
|                               
|                               
|                               
|                               
|                                | Additional
          paid-in capital                                                                                                            |                                                    |                                                      | 1,888,662 |             |           |              | 1,888,662 |        
|                               
|                               
|                               
|                               
|                                | Accumulated
          deficit                                                                                                                   |                                                    |                                                      | (191,381  | )           |           |              | (130,636  | )      
|                               
|                               
|                               
|                               
|                                | Accumulated
          other comprehensive income (loss)                                                                                         |                                                    |                                                      | (4,522    | )           |           |              | 147       |        
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          shareholders equity                 |           |             | 1,698,310 |              |           |         | 1,763,724 | 
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          
|                                |                                                                                                                                                 |                                                    | Total
          liabilities and shareholders equity |           | $           | 3,842,509 |              |           | $       | 3,632,538 | 
|                                |                                                                                                                                                 |                                                    |                                                      |           |             |           |              |          

See accompanying notes to
  condensed consolidated financial statements.

3



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ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
  (In thousands, except share and per share information)
  (Unaudited)

|                                                          |                                                                                         |                                   |         |                    |         |           |        |             |        | 
|--------------------------------------------------------- | --------------------------------------------------------------------------------------- | --------------------------------- | ------- | ------------------ | ------- | --------- | ------ | ----------- | ------ | 
|                                                          |                                                                                         |                                   |         | Three Months Ended
|                                                          |                                                                                         |                                   |         |                   
|                                                          |                                                                                         |                                   |         | March 31,          |         | March 31,
|                                                          |                                                                                         |                                   |         | 2001               |         | 2000     
|                                                          |                                                                                         |                                   |         |                    |         |          
|Revenues                                                  |                                                                                         | $                                 | 9,512   |                    |         | $         | 75,804 |            
|                                                         
|                                                         
|                                                         
|                                                         
|Operating
          expenses:                            
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Cost of
          access and maintenance                                                |                                   |         | 15,324             |         |           |        | 12,484      |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Other
          operating expenses                                                      |                                   |         | 24,965             |         |           |        | 6,200       |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Depreciation
          and amortization                                                 |                                   |         | 20,259             |         |           |        | 34,847      |       
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|                                                          |                                                                                         |                                   | 60,548  |                    |         |           | 53,531 |            
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|                                                          |                                                                                         | Operating
          income (loss) |         |                    | (51,036 | )         |        |             | 22,273 | 
|                                                         
|                                                         
|                                                         
|                                                         
|Other
          income (expense):                        
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Minority
          interest                                                             |                                   |         | 15,179             |         |           |        | (10,661     | )     
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Equity
          in loss of affiliates                                                  |                                   |         | (15,299            | )       |           |        | (14,015     | )     
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Interest
          income                                                               |                                   |         | 11,589             |         |           |        | 3,999       |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Interest
          expense                                                              |                                   |         | (16,331            | )       |           |        | (1,016      | )     
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Other
          expense, net                                                            |                                   |         | (2,347             | )       |           |        | (259        | )     
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|Income
          (loss) before provision for income taxes |                                                                                         |                                   | (58,245 | )                  |         |           | 321    |            
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Provision
          for income taxes                                                    |                                   |         | (2,500             | )       |           |        |            |       
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|Net income
          (loss)                               |                                                                                         | $                                 | (60,745 | )                  |         | $         | 321    |            
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|Net income
          (loss) per common share:            
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Basic
          and diluted net income (loss) per common share                          |                                   | $       | (0.11              | )       |           | $      | 0.00        |       
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            
|                                                          | Shares
          used in computing basic and diluted net income (loss) per common share |                                   |         | 555,125,125        |         |           |        | 486,625,125 |       
|                                                          |                                                                                         |                                   |         |                    |         |           |        |            

See accompanying notes to
  condensed consolidated financial statements.

4



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
  (In thousands)
  (Unaudited)

|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |           |           |        |          |  
|-------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------- | ------------------------------------------------------ | ------------------------------------------------------------- | -------- | ------------------ | -------- | --------- | --------- | ------ | -------- | -
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          | Three Months Ended
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                   
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          | March 31,          |          | March 31,
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          | 2001               |          | 2000     
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|CASH FLOWS
          FROM OPERATING ACTIVITIES:               
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Net income
          (loss)                                                                                  |                                                             | $                                                      | (60,745                                                       | )        |                    | $        | 321       |          
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Adjustments
          to reconcile net income (loss) to net cash provided by operating
          activities:
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Depreciation
          and amortization                |                                                               |          | 20,259             |          |           |           | 34,847 |         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Amortization
          of deferred finance fees        |                                                               |          | 1,989              |          |           |           |       |         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Provision
          for doubtful accounts              |                                                               |          | 39                 |          |           |           | 763    |         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Equity
          in loss of affiliates                 |                                                               |          | 15,299             |          |           |           | 14,015 |         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Minority
          interest                            |                                                               |          | (15,179            | )        |           |           | 10,912 |         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             | Changes
          in operating assets and liabilities:
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Accounts
          receivable                                 |          |                    | 8,976    |           |           |        | (18,351  | )
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Receivable
          from affiliates                          |          |                    | (27,189  | )         |           |        | 69,054   |  
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Other
          assets                                        |          |                    | (1,471   | )         |           |        | (17,303  | )
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Deferred
          revenue                                    |          |                    | 265,544  |           |           |        | 43,160   |  
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Accounts
          payable and accrued liabilities            |          |                    | 4,212    |           |           |        | (2,280   | )
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Income
          taxes payable                                |          |                    | 2,437    |           |           |        |         |  
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              |                                                             |                                                        | Payable
          to affiliates                               |          |                    | (111     | )         |           |        | (96,202  | )
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              |                                                             |                                                        | Net cash
          provided by operating activities           |          |                    | 214,060  |           |           |        | 38,936   |  
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|CASH FLOWS
          FROM INVESTING ACTIVITIES:               
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Cash acquired
          from consolidating Pacific Crossing Ltd.                                             |                                                             |                                                        |                                                              |          |                    |          | 606       |          
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Change
          in restricted cash and cash equivalents                                                     |                                                             |                                                        | 6,948                                                         |          |                    |          | 19,753    |          
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Purchase
          of property and equipment                                                                 |                                                             |                                                        | (247,347                                                      | )        |                    |          | (176,992  | )        
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Acquisition
          of minority share in affiliate                                                         |                                                             |                                                        |                                                              |          |                    |          | (20,585   | )        
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Cash paid
          for investments                                                                          |                                                             |                                                        | (2,000                                                        | )        |                    |          |          |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              |                                                             |                                                        | Net cash
          used in investing activities               |          |                    | (242,399 | )         |           |        | (177,218 | )
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|CASH FLOWS
          FROM FINANCING ACTIVITIES:               
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Proceeds
          from capital contribution                                                                 |                                                             |                                                        | 9,677                                                         |          |                    |          | 280,032   |          
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Net repayments
          under Pacific Crossing -1 credit facility                                           |                                                             |                                                        | (41,963                                                       | )        |                    |          |          |          
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Minority
          interest investment in affiliates                                                         |                                                             |                                                        |                                                              |          |                    |          | 54,583    |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              |                                                             |                                                        | Net cash
          provided by (used in) financing activities |          |                    | (32,286  | )         |           |        | 334,615  |  
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|Exchange
          Rate Effect on Cash and Cash Equivalents    |                                                                                                              |                                                             | 72                                                     |                                                               |          |                    | 1,397    |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|Net Increase
          (Decrease) in Cash and Cash Equivalents |                                                                                                              |                                                             | (60,553                                                | )                                                             |          |                    | 197,730  |          
|                                                              
|                                                              
|                                                              
|                                                              
|Cash and
          Cash Equivalents, beginning of period       |                                                                                                              |                                                             | 705,161                                                |                                                               |          |                    | 9,784    |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|Cash and
          Cash Equivalents, end of period             |                                                                                                              | $                                                           | 644,608                                                |                                                               |          | $                  | 207,514  |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|SUPPLEMENTAL
          INFORMATION ON NON-CASH INVESTING      
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | AND FINANCING
          ACTIVITIES:                                                                         
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Increase
          (decrease) in accrued construction costs |                                                        | $                                                             | 37,027   |                    |          | $         | (48,582   | )     
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Amortization
          of deferred finance costs            |                                                        |                                                               | 270      |                    |          |           | 1,137     |       
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Increase
          in accrued capitalized interest          |                                                        |                                                               | 13,642   |                    |          |           |          |       
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Costs
          incurred for property and equipment         |                                                        |                                                               | (298,286 | )                  |          |           | (129,547  | )     
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              | Cash paid
          for property and equipment              |                                                        | $                                                             | (247,347 | )                  |          | $         | (176,992  | )     
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|SUPPLEMENTAL
          DISCLOSURE OF CASH FLOW INFORMATION:   
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               | Cash paid
          for interest and income taxes                                                            |                                                             |                                                        |                                                               |          |                    |          |           |          
|                                                               |                                                                                                              | Interest paid and capitalized                               |                                                        | $                                                             | 15,309   |                    |          | $         | 19,152    |       
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              | Interest
          paid (net of capitalized interest)       |                                                        | $                                                             | 14,120   |                    |          | $         | 891       |       
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              | Cash paid
          for taxes                               |                                                        | $                                                             | 65       |                    |          | $         |          |       
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               | Details
          of consolidating Pacific Crossing Ltd.                                                    
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Assets
          consolidated                               |                                                        | $                                                             |         |                    |          | $         | 1,124,138 |       
|                                                              
|                                                              
|                                                              
|                                                              
|                                                               |                                                                                                              | Liabilities
          consolidated                          |                                                        |                                                               |         |                    |          |           | (945,903  | )     
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          
|                                                               |                                                                                                              | $                                                           |                                                       |                                                               |          | $                  | 178,235  |          
|                                                               |                                                                                                              |                                                             |                                                        |                                                               |          |                    |          |          

See accompanying notes to
  condensed consolidated financial statements.

5



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
  (In thousands)
  (Unaudited)

|                                      |                                                          |   |                    |        |                |   |       |       | 
|------------------------------------- | -------------------------------------------------------- | - | ------------------ | ------ | -------------- | - | ----- | ----- | 
|                                      |                                                          |   | Three Months Ended
|                                      |                                                          |   |                   
|                                      |                                                          |   | March 31, 2001     |        | March 31, 2000
|                                      |                                                          |   |                    |        |               
|Net income
          (loss)           |                                                          | $ | (60,745            | )      |                | $ | 321   |      
|                                     
|                                     
|                                     
|                                     
|                                      | Change
          in fair value of derivative instruments |   |                    | (1,710 | )              |   |       |      | 
|                                     
|                                     
|                                     
|                                     
|                                      | Foreign
          currency translation adjustment        |   |                    | (2,959 | )              |   |       | 1,397 | 
|                                      |                                                          |   |                    |        |                |   |       |      
|Comprehensive
          income (loss) |                                                          | $ | (65,414            | )      |                | $ | 1,718 |      
|                                      |                                                          |   |                    |        |                |   |       |      



See accompanying notes to
  condensed consolidated financial statements.

6



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  MARCH 31, 2001
  (Unaudited)

(1) Organization and Background

Nature of Business

Asia Global Crossing Ltd., a Bermuda company
  (together with its consolidated subsidiaries, the Company or Asia
  Global Crossing) is a leading pan-Asian telecommunications carrier providing
  telecommunications services, including Internet, data, voice and web-hosting
  services to wholesale and business customers. Asia Global Crossing owns 64.5%
  of Pacific Crossing-1, a 21,000 kilometer undersea cable that connects Japan
  and the United States. The Company is constructing East Asia Crossing, a 19,500
  kilometer undersea fiber optic cable that connects Japan to Hong Kong. The Company
  expects to extend East Asia Crossing to Taiwan in the second quarter of 2001,
  to Korea in the third quarter of 2001, to Singapore in the fourth quarter of
  2001, and at a later time, to Malaysia and the Philippines, and if when regulations
  permit, China. Both of these systems will be seamlessly connected to the Global
  Crossing network, which, including Pacific Crossing-1 and East Asia Crossing,
  when completed will consist of 162,544 announced route kilometers which will serve four continents,
  27 countries and more than 200 major cities.

Initial Public Offering

In the fourth quarter of 2000, the Company
  completed its initial public offering (IPO) in which it sold 68.5 million
  shares of its Class A common stock at a price of $7.00 per share. The net
  proceeds of the IPO, after deducting underwriting discounts, commissions and
  costs were approximately $455.1 million. Upon completion of the IPO, Global
  Crossing Ltd. (Global Crossing), Softbank Corp. (Softbank)
  and Microsoft Corporation (Microsoft) owned 56.9%, 15.4% and 15.4%,
  respectively, of the Company.

Concurrent with the Companys IPO,
  Global Crossing, Microsoft and Softbank contributed to the Company their aggregate
  interest of 50% in Hutchison Global Crossing Holdings Limited and subsidiaries
  (HGC). HGC provides fixed network services, including international
  services, local fixed network services, and multimedia services in Hong Kong.
  At the same time, Global Crossing contributed its 49% interest in Global Access
  Limited (GAL) to the Company. GAL constructs and operates a terrestrial
  digital fiber optic cable system connecting Tokyo, Osaka and Nagoya with Pacific
  Crossing-1, providing communication network services.

Joint Ventures

Singapore.On May 20, 2000,
  the Company entered into a non-binding memorandum of understanding with Singapore
  Technologies Telemedia, or STT, with respect to the formation of a joint venture
  in Singapore. On January 12, 2001, the Company entered into such joint
  venture agreement. On March 22, 2001, the Company entered into an amended
  and restated joint venture agreement to add STTs subsidiary, StarHub Pte
  Ltd. or StarHub, as a named party to the existing joint venture agreement. The
  joint venture, to be known as StarHub Crossing Pte Ltd, will be a 50:50 joint
  venture between StarHub and the Company and will build and operate a backhaul
  network and telehouse in Singapore, providing the Company with the necessary
  components to extend East Asia Crossing into Singapore. In October 2000,
  the Company received from InfoComm Development Authority of Singapore a facilities-based
  operator license. The license entitles the Company to build and operate its
  cable station and the joint venture to build and operate a backhaul system and
  telehouse. STT, StarHub and their affiliates have committed to purchase $70 million
  in capacity from the Companys network.

Korea.On January 30, 2001,
  the Company entered into an agreement to form a joint venture with DACOM Corporation,
  a leading Korean telecommunications company, to build and operate a cable station
  for East Asia Crossing, a backhaul network and a telehouse in Korea. On March 27,
  2001, the joint venture agreement was amended. The joint venture will be owned
  49% by the Company, 48.9% by DACOM and 2.1% by OPICOM.

7



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)

Through the joint venture, the Company
  plans to sell point-to-point capacity on an indefeasible right of use basis
  and international private line services in Korea and the Asia-Pacific region.
  In addition, DACOM will purchase capacity on East Asia Crossing and Pacific
  Crossing-1. The closing of the joint venture agreement is subject to approval
  by the boards of directors of DACOM and the Company and is subject to the Company
  reaching definite agreements with DACOM.

(2) Basis of Presentation

The accompanying unaudited interim condensed
  consolidated financial statements have been prepared in accordance with generally
  accepted accounting principles (GAAP) for interim financial reporting
  and Securities and Exchange Commission (SEC) regulations. Certain
  information and footnote disclosures normally included in financial statements
  prepared in accordance with GAAP have been condensed or omitted pursuant to
  such rules and regulations. In the opinion of management, the unaudited interim
  consolidated financial statements reflect all adjustments necessary to fairly
  present the results of operations, financial position and cash flows for the
  periods presented. The results of operations for any interim period are not
  necessarily indicative of results for the full year. These financial statements
  should be read in conjunction with the audited financial statements and notes
  thereto included in the Companys Annual Report on Form 10-K for the
  year ended December 31, 2000.

Concurrent with the IPO in October 2000,
  HGC and GAL were contributed to the Company. These contributions were accounted
  for by the Company similar to the pooling-of-interests method of accounting
  because HGC, GAL and the Company are entities under common control of Global
  Crossing. Prior to these contributions, Global Crossing accounted for its investments
  in HGC and GAL under the equity method of accounting. In preparing
these condensed
  consolidated financial statements, GAL and HGCs statements of operations
  for the three months ended March 31, 2000 have been retroactively combined
  with the Companys consolidated statement of operations for the three months
  ended March 31, 2000 under the equity method of accounting.

(3) Significant Accounting Policies

Revenue Recognition

Services.Revenues derived from
  telecommunication and maintenance services, including sales of capacity under
  operating-type leases, are recognized as services are provided. Payments received
  from customers before the relevant criteria for revenue recognition are satisfied
  are included in deferred revenue in the accompanying condensed consolidated
  balance sheets.

Operating Leases.The
  Company offers customers flexible bandwidth products to multiple destinations
  and many of the contracts for subsea circuits entered into are part of a service
  offering. Consequently, the Company defers revenue related to those circuits
  and amortizes the revenue over the appropriate term of the contract. Accordingly,
  the Company treats cash received prior to the completion of the earnings process
  as deferred revenue.

Sales-Type Leases.Revenues from
  Capacity Purchase Agreements (CPAs) that meet the criteria of sales-type
  lease accounting are recognized in the period that the rights and obligations
  of ownership transfer to the purchaser, which occurs when (i) the purchaser
  obtains the right to use the capacity, which can only be suspended if the purchaser
  fails to pay the full purchase price or fulfill its contractual obligations,
  (ii) the purchaser is obligated to pay Operations, Administration and Maintenance
  (OA&M) costs and (iii) the segment of a system related
  to the capacity purchased is available for service. Certain customers who have
  entered into CPAs for capacity have paid deposits toward the purchase price
  which have been included as deferred revenue in the accompanying condensed consolidated
  balance sheets. The Company follows the criteria set forth in Statement of Financial
  Accounting Standards (SFAS) No. 66, Accounting for Sales of
  Real Estate for transactions which qualify for sales-type lease accounting.

There was no sales-type lease revenue recognized
  in the three months ended March 31, 2001. For the three months ended March 31,
  2000, the Company recognized $75.0 million sales-type lease revenue.

8



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##### Table of Contents



ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)

Operating Expenses

Operating Leases.Costs of the network
  relating to capacity contracts accounted for as operating leases are treated
  as fixed assets and, accordingly, are depreciated over the estimated useful
  life of the capacity.

Sales-Type Leases  Non-Cash Cost
  of Capacity Sold.At the date each segment of a system becomes operational,
  the related amounts included in construction in progress are reclassified, and
  depreciation commences. For contracts that meet the criteria for sales-type
  lease accounting, the Companys policy provides for recording non-cash
  cost of capacity sold through depreciation and amortization in the period in
  which the related revenue was recognized. The amount charged to non-cash cost
  of capacity sold relating to subsea capacity is calculated by determining the
  estimated net book value of the specific subsea capacity at the time of the
  sale. The estimated book value includes expected costs of capacity the Company
  has the intent and ability to add through upgrades of that system, provided
  the need for such upgrades is supported by a third-party consultants revenue
  forecast.

There was no non-cash cost of capacity
  sold for the three months ended March 31, 2001. For the three months ended
  March 31, 2000, the non-cash cost of capacity sold was $30.8 million
  included in depreciation and amortization expense in the accompanying condensed
  consolidated statement of operations.

Derivative Instruments

Effective January 1, 2001, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments
and Hedging Activities", as amended by SFAS 137, "Accounting for Derivative
Instruments and Hedging Activities - Deferral of the Effective Date of FASB
Statement No. 133", and SFAS No. 138, "Accounting for Certain Derivatives
Instruments and Certain Hedging Activities". SFAS 133 establishes standards of
accounting and reporting for derivatives instruments and hedging activities, and
requires that all derivatives be recognized on the balance sheet at fair value.
Changes in the fair value of derivatives that do not meet the hedge treatment,
as well as the ineffective portion of any hedges, are to be reported in
earnings. The cumulative effect of adopting these new standards did not have a
material effect of the Company's results of operations or its financial position
for the period presented in the financial statements included herein.

The Company utilizes certain derivative financial instruments to
enhance its ability to manage risk, including interest rates and foreign
currency, which exist as part of ongoing business operations. Derivative
instruments are entered into for periods consistent with related underlying
exposures and do not constitute positions independent of these exposures.

The Company designates derivatives as either fair value hedges or cash
flow hedges. If the derivative is designated as a fair value hedge, the changes
in the fair value of the derivative and of the hedged item attributable to the
hedged risk are recognized in earnings. If the derivative is designated as a
cash flow hedge, the effective portions of changes in the fair value of the
derivative are recorded in other comprehensive income or loss ("OCI" or "OCL")
and are recognized in the income statement when the hedged transaction affects
earnings. Ineffective portions of changes in the fair value of cash flow hedges
are recognized in earnings. At March 31, 2001, the Company had cash flow hedges
related to interest rate swaps with an aggregate fair value of $1.7 million
recorded in OCL.

Reclassifications

Certain prior year amounts have been reclassified
  in the accompanying condensed consolidated financial statements to conform to
  current year presentation.

(4) Property and Equipment

Property and equipment consist of the following
  (in thousands):

|                                            |                                        |   |             |           |              |   |           |           | 
|------------------------------------------- | -------------------------------------- | - | ----------- | --------- | ------------ | - | --------- | --------- | 
|                                            |                                        |   | March 31,   |           | December 31,
|                                            |                                        |   | 2001        |           | 2000        
|                                            |                                        |   |             |           |             
|                                            |                                        |   | (Unaudited)
|Terrestrial
          capacity              |                                        | $ | 76,272      |           |              | $ | 69,390    |          
|                                           
|                                           
|                                           
|                                           
|Subsea
          transmission equipment     |                                        |   | 1,587,008   |           |              |   | 1,384,240 |          
|                                           
|                                           
|                                           
|                                           
|Leasehold
          improvements            |                                        |   | 6,955       |           |              |   | 7,308     |          
|                                           
|                                           
|                                           
|                                           
|Furniture,
          fixtures and equipment |                                        |   | 13,896      |           |              |   | 13,712    |          
|                                            |                                        |   |             |           |              |   |           |          
|                                            | Total
          property and equipment |   |             | 1,684,131 |              |   |           | 1,474,650 | 
|                                           
|                                           
|                                           
|                                           
|Less:
          accumulated depreciation    |                                        |   | (146,073    | )         |              |   | (126,815  | )        
|                                            |                                        |   |             |           |              |   |           |          
|                                            |                                        |   | 1,538,058   |           |              |   | 1,347,835 |          
|                                           
|                                           
|                                           
|                                           
|Construction
          in progress          |                                        |   | 650,377     |           |              |   | 566,183   |          
|                                            |                                        |   |             |           |              |   |           |          
|Property
          and equipment, net       |                                        | $ | 2,188,435   |           |              | $ | 1,914,018 |          
|                                            |                                        |   |             |           |              |   |           |          

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ASIA GLOBAL CROSSING LTD. AND SUBSIDIARIES
  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)

(5) Investments in Affiliates

The Companys investments in affiliates
  consist of the following (in thousands):

|                            |                                     |   |           |         |              |   |         |         | 
|--------------------------- | ----------------------------------- | - | --------- | ------- | ------------ | - | ------- | ------- | 
|                            |                                     |   | March 31, |         | December 31,
|                            |                                     |   | 2001      |         | 2000        
|                            |                                     |   |           |         |             
|Investment
          in GAL |                                     | $ | 13,071    |         |              | $ | 14,454  |        
|                           
|                           
|                           
|                           
|Investment
          in HGC |                                     |   | 592,258   |         |              |   | 606,174 |        
|                           
|                           
|                           
|                           
|Other                       |                                     |   | 2,000     |         |              |   |        |        
|                            |                                     |   |           |         |              |   |         |        
|                            | Investments
          in affiliates |   | $         | 607,329 |              |   | $       | 620,628 | 
|                            |                                     |   |           |         |              |   |         |        

The summarized combined statements of operations
  data of GAL are as follows (the average exchange rates of approximately JPY¥115=$1.00
  and JPY¥107=$1.00 have been used to translate GALs financial information
  in Japanese yen into U.S. dollars for the three months ended March 31,
  2001 and 2000, respectively) (in thousands):

|                         |  |           |        |           |  |   |        |  
|------------------------ |  | --------- | ------ | --------- |  | - | ------ | -
|                         |  | March 31, |        | March 31,
|                         |  | 2001      |        | 2000     
|                         |  |           |        |          
|Revenues                 |  | $         | 7,829  |           |  | $ | 3,027  |  
|                        
|                        
|                        
|                        
|Operating
          loss |  |           | (2,620 | )         |  |   | (5,214 | )
|                        
|                        
|                        
|                        
|Net loss                 |  | $         | (2,822 | )         |  | $ | (5,429 | )

The summarized combined statements of operations
  data of HGC are as follows (the average exchange rate of approximately HK$7.80=$1.00
  has been used to translate HGCs financial information in Hong Kong dollars
  into U.S. dollars) (in thousands):

|                         |  |           |         |           |  |   |        |  
|------------------------ |  | --------- | ------- | --------- |  | - | ------ | -
|                         |  | March 31, |         | March 31,
|                         |  | 2001      |         | 2000     
|                         |  |           |         |          
|Revenues                 |  | $         | 32,713  |           |  | $ | 29,013 |  
|                        
|                        
|                        
|                        
|Operating
          loss |  |           | (12,672 | )         |  |   | (8,705 | )
|                        
|                        
|                        
|                        
|Net loss                 |  | $         | (13,483 | )         |  | $ | (8,366 | )

(6) Net Income (Loss) Per Share

Basic net income (loss) per share
  is computed by dividing net income (loss) by the weighted average number
  of shares of common stock outstanding during the reporting period. Diluted net
  income (loss) per share are computed similar to basic net income (loss) per
  share while giving effect to all potentially diluted common shares that were
  outstanding during the period. Dilutive options did not have an effect on the
  computation of diluted net income (loss) per share for the three months
  ended March 31, 2001 since they were anti-dilutive.

(7) Related Party Transactions

During the normal course of business, the Company has entered into
various transactions with certain related parties. The following information
should be read in conjunction with the footnote 10 - Related Party Transactions
in the audited consolidated financial statements and notes thereto contained in
the Company's Annual Report on Form 10-K for the year ended December 31, 2000.

Revenues generated from sales to third-party
customers through Global Crossing for the three months ended
March 31, 2001 and 2000 were approximately
$3.3 million and $45.8 million, respectively.

For the three months ended March 31, 2001 and 2000, the Company
purchased network capacity of approximately $8.4 million and $14.7 million,
respectively, from its non-consolidated joint ventures. During the three months
ended March 31, 2000, the Company also purchased network capacity of
approximately $6.4 million from Global Crossing. Such purchase during the same
period of 2001 was not material.

For the three months ended March 31, 2001 and 2000, the corporate
shared service charges from Global Crossing were $3.5 million and $1.3 million,
respectively.

10



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##### Table of Contents









ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
  CONDITION AND RESULTS OF OPERATIONS

This information should be read in conjunction
  with the unaudited condensed consolidated financial statements and the notes
  thereto included in this Quarterly Report, and the audited consolidated financial
  statements and notes thereto and Managements Discussion and Analysis of
  Financial Condition and Results of Operations contained in our Annual Report
  on Form 10-K for the year ended December 31, 2000.

General

We were formed in November 1999 and
  have a limited operating history. In the fourth quarter of 2000, we completed
  our initial public offering (IPO) in which we sold 68.5 million
  shares of our Class A common stock at a price of $7.00 per share. Upon
  completion of the IPO, Global Crossing, Ltd. (Global Crossing),
  Softbank Corp. (Softbank) and Microsoft Corporation (Microsoft)
  owned 56.9%, 15.4% and 15.4%, respectively, of us.

Concurrent with our IPO, Global Crossing,
  Microsoft and Softbank contributed their aggregate interest of 50% in Hutchison
  Global Crossing Holdings Limited and subsidiaries (HGC) to us. At
  the same time, Global Crossing contributed its 49% interest in Global Access
  Limited (GAL) to us. These contributions were accounted for by us
  similar to the pooling-of-interests method of accounting. In preparing these
  condensed consolidated financial statements, GAL and HGCs statements of
  operations for the three months ended March 31, 2000 have been retroactively
  combined with our consolidated statement of operations for the three months
  ended March 31, 2000 under the equity method of accounting.

In December 1999, the first segment
  of Pacific Crossing-1 commenced service, and the full ring was completed in
  December 2000. In January 2001, the first segment of East Asia Crossing
  connecting Hong Kong and Japan commenced service.

We expect that wholesale bandwidth pricing
  in the trans-Pacific market is likely to continue to decline in future years
  as a result of the increasing supply of trans-Pacific bandwidth capacity. We
  expect similar price decline in other markets in which we will operate. Although
  prices are expected to continue to decline, we anticipate that the impact to
  our revenue will be offset by the increasing demand for bandwidth capacity.
  Our revenue through the end of year 2000 was primarily derived from the sale
  of wholesale bandwidth capacity on Pacific Crossing-1. In fiscal year 2001,
  we expect a significant portion of our revenue growth to be derived from the
  sale of wholesale bandwidth capacity on East Asia Crossing and other services,
  including Internet, data and voice services, to wholesale and business customers.

Results of Operations

We monitor our financial performance using
  certain metrics which reflect our performance and liquidity on a consolidated
  basis, and on a proportionate ownership basis, reflecting our interests in consolidated
  and non-consolidated joint ventures.

Cash Revenue refers to revenue plus the
  cash portion of the change in deferred revenue. We present Cash Revenue because
  it is a financial indicator used by investors and analysts to compare companies
  on the basis of cash receipts from sales of capacity and services. This information
  should not be considered as an alternative to any measure of performance as
  promulgated under generally accepted accounting principles (GAAP).

11



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##### Table of Contents



Adjusted EBITDA is defined as operating
  income (loss) plus goodwill and intangible amortization, depreciation and
  amortization, which includes non-cash cost of capacity sold, stock-related expenses
  and the cash portion of the change in deferred revenue. This definition is consistent
  with financial covenants contained in our major financing agreements. We present
  Adjusted EBITDA because it is a financial indicator used by investors and analysts
  to analyze and compare companies on the basis of operating performance and because
  we believe that Adjusted EBITDA is an additional, meaningful measure of performance
  and liquidity. We use Adjusted EBITDA to monitor our compliance with our financial
  covenants. This information should not be considered as an alternative to any
  measure of performance as promulgated under GAAP. The calculation of Adjusted
  EBITDA may be different from the calculation used by other companies and, therefore,
  comparability may be limited.

Proportionate Cash Revenue represents the
  sum of our ownership percentage of the Cash Revenue allocated to us and our
  non-consolidated joint ventures plus incremental Cash Revenue contributions
  from these joint ventures.

Proportionate Adjusted EBITDA refers to
  Proportionate Cash Revenue less proportionate cash operating expenses, which
  represents our ownership percentage of the cash operating expenses of Asia Global
  Crossing and our non-consolidated joint ventures. Cash operating expense is
  defined as operating expenses plus goodwill and intangible amortization, depreciation
  and amortization, which includes non-cash cost of capacity sold, and stock-related
  expenses.

We believe these proportionate metrics
  reflect the economic results of the business given that we conduct our business
  through a number of entities, many of which are not consolidated. In calculating
  Proportionate Cash Revenue, management makes certain estimates and assumptions
  since, among other things, Cash Revenue may be associated with capacity selections
  that the customer may make at a later time. Actual amounts and results could
  differ from those estimates. If the customer has the option to select systems
  outside of those controlled by us and our joint ventures, the associated Cash
  Revenue is not included in determining Proportionate Cash Revenue until such
  selection is made.

The following table represents the selected
  unaudited consolidated financial data for the three months ended March 31,
  2001 and 2000, respectively (in thousands):

|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |        |         |        | 
|---------------------------------------------------------------------- | --------------------------------------------------------------------------------- | ------------------------------------------------------------------------- | --------------------------------------- | ------ | -------------- | ------- | -------------- | ------ | ------- | ------ | 
|                                                                       |                                                                                   |                                                                           |                                         |        | Quarter Ended 
|                                                                       |                                                                                   |                                                                           |                                         |        |               
|                                                                       |                                                                                   |                                                                           |                                         |        | March 31, 2001 |         | March 31, 2000
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |               
|Revenues                                                               |                                                                                   | $                                                                         | 9,512                                   |        |                | $       | 75,804         |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|Proportionate
          Cash Revenue                                   |                                                                                   |                                                                           | 205,520                                 |        |                |         | 96,198         |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|Proportionate
          Adjusted EBITDA                                |                                                                                   |                                                                           | 147,580                                 |        |                |         | 61,914         |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|Revenues:                                                             
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Sales-type
          leases                                               |                                         | $      |               |         |                | $      | 74,959  |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Services
          (1)                                                    |                                         |        | 8,531          |         |                |        | 818     |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Amortization
          of prior period IRUs                              |                                         |        | 981            |         |                |        | 27      |       
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|                                                                       |                                                                                   | Total
          Revenues                                                  |                                         | $      | 9,512          |         |                | $      | 75,804  |       
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|Adjusted
          EBITDA:                                            
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Operating
          income (loss)                                         |                                         | $      | (51,036        | )       |                | $      | 22,273  |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Depreciation
          and amortization                                   |                                         |        | 20,259         |         |                |        | 34,847  |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Cash portion
          of the change in deferred revenue                  |                                         |        | 270,048        |         |                |        | 20,180  |       
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|                                                                       |                                                                                   | Adjusted
          EBITDA                                                 |                                         | $      | 239,271        |         |                | $      | 77,300  |       
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|Proportionate
          Cash Revenue and Proportionate Adjusted EBITDA
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Cash Revenue                                                              |                                         | $      | 279,560        |         |                | $      | 95,984  |       
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Less:
          Cash Revenue proportionately owned by other companies (2) |                                         |        | (91,390        | )       |                |        | (14,292 | )     
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       | Add: Incremental
          contributions from non-consolidated joint ventures (3) |                                                                           |                                         | 17,350 |                |         |                | 14,506 |        
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|                                                                       |                                                                                   |                                                                           | Proportionate
          Cash Revenue    |        | $              | 205,520 |                |        | $       | 96,198 | 
|                                                                      
|                                                                      
|                                                                      
|                                                                      
|                                                                       |                                                                                   | Less:
          Proportionate cash operating expense (4)                  |                                         |        | (57,940        | )       |                |        | (34,284 | )     
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       
|                                                                       |                                                                                   |                                                                           | Proportionate
          Adjusted EBITDA |        | $              | 147,580 |                |        | $       | 61,914 | 
|                                                                       |                                                                                   |                                                                           |                                         |        |                |         |                |       

12



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##### Table of Contents





---

|(1) |  | Service revenue includes revenue from telecommunications services
      and maintenance services.                                                                                                                                                                                                                                                                                                          
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | This amount represents other companies ownership percentage
      in our Cash Revenue. The calculation of this amount requires management
      to make certain estimates and assumptions since, amongst other things, Cash
      Revenue may be associated with capacity selections that the customer may
      make at a later time. Actual amounts and results could differ from those
      estimates.
|   
|   
|   
|   
|(3) |  | This amount represents our ownership percentage in Cash Revenue
      generated by business between our non-consolidated joint ventures and third
      parties.                                                                                                                                                                                                                                           
|   
|   
|   
|   
|(4) |  | This amount represents our ownership percentage in cash operating
      expenses of Asia Global Crossing and our affiliates.                                                                                                                                                                                                                                                                               

Three months ended March 31, 2001 compared to the three months ended
March 31, 2000

Revenues. Revenues for the first
  quarter of 2001 were $9.5 million, compared to $75.8 million in the
  first quarter of 2000 which included $75.0 million sales-type lease revenue.
  Sales-type leases recognize revenue up-front rather than amortizing it over
  the life of the contract. We have since de-emphasized such type of transactions
  with our customers. Excluding the impact of $75.0 million sales-type lease
  revenue, revenues for the first quarter of 2001 increased $8.7 million,
  primarily due to additional service revenue generated by our Internet and data
  service business.

Proportionate Cash Revenue.Proportionate
  Cash Revenue for the first quarter of 2001 increased to $205.5 million
  from $96.2 million in the first quarter of 2000, an increase of $109.3 million
  or 114%. The growth was primarily attributable to an increase of $84.0 million
  in capacity sales on Pacific Crossing-1 and East Asia Crossing systems.
  During the quarter, Global Crossing, our major shareholder, entered into several
  agreements with various carriers for the purchase of capacity and co-location
  space. Our Proportionate Cash Revenue included $148 million for payments
  received from certain of these carriers.

Cost of access and maintenance.
  Cost of access and maintenance mainly includes operating, administration and
  maintenance (OA&M) costs incurred in connection with maintaining
  our systems and cable landing stations. For the three months ended March 31,
  2001, cost of access and maintenance increased to $15.3 million from $12.5 million
  in the same period of 2000, an increase of $2.8 million, or 22%, due to
  the additional OA&M expenses incurred for East Asia Crossing, which became
  operational in the first quarter of 2001. In the first quarter of 2000, only
  the first segment of Pacific Crossing-1 was operational.

Other operating expenses. Other
  operating expenses consist principally of salaries and employee benefits, marketing
  and promotional costs, occupancy costs, travel costs, professional fees, and
  corporate shared service charges from Global Crossing. Other operating expenses
  for the first quarter of 2001 was $25.0 million, compared to $6.2 million
  in the first quarter of 2000, an increase of $18.8 million, primarily a
  result of increased headcounts and growing operating activities.

Depreciation and amortization. Depreciation
  and amortization expense for the first quarter of 2001 decreased to $20.3 million
  from $34.8 million in the comparable prior year period, a decrease of $14.5 million.
  Depreciation and amortization expense includes non-cash cost of capacity sold
  resulting from capacity sales that meet the qualifications of sales-type lease
  accounting. For the quarter ended March 31, 2001, there was no non-cash
  cost of capacity sold because we have de-emphasized sales-type leases with customers.
  For the first quarter of 2000, the non-cash cost of capacity sold included in
  depreciation and amortization expense was approximately $30.8 million.
  Excluding the impact of non-cash cost of capacity sold, depreciation and amortization
  expense for the first quarter of 2001 increased $16.3 million, due primarily
  to additional depreciation expense incurred for Pacific Crossing-1, of
  which the full ring became fully operational at the end of 2000, but only the
  first segment was operational in the first quarter of 2000.

Minority interest. Minority interest
  represents the minority partners interest in the income or loss of our
  consolidated joint ventures, primarily Pacific Crossing Ltd. For the first quarter
  of 2001, minority interest was $15.2 million, compared to $(10.7) million
  in the comparable prior year period. Pacific Crossing Ltd. incurred a net loss
  of $40.5 million in the three months ended March 31, 2001 compared
  to a net income of $29.8 million in the same period of 2000, primarily
  a result of the decrease in sales-type lease revenue. In addition, depreciation
  expense and interest expense increased $15.0 million and $14.7 million,
  respectively, due to the completion of Pacific Crossing-1 at the end of 2000.
  Interest costs are not capitalized and depreciation commences upon completion
  of system construction.

13



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##### Table of Contents



Equity in loss of affiliates.Equity
  in loss of affiliates for the three months ended March 31, 2001 increased
  to $15.3 million from $14.0 million in the comparable prior year period,
  an increase of $1.3 million, or 9%, due to an increase of $2.6 million
  in equity in loss of HGC, partially offset by a decrease of $1.3 million
  in equity in loss of GAL.

Interest income. Interest income
  increased to $11.6 million in the first quarter of 2001 from $4.0 million
  for the first quarter of 2000, an increase of $7.6 million. The significant
  increase was primarily due to investment returns on cash received from our initial
  public offering and senior notes offering in October 2000.

Interest expense. For the first
  quarter of 2001, interest expense increased to $16.3 million from $1.0 million
  in the comparable prior year period, an increase of $15.3 million, due
  primarily to interest incurred under the Pacific Crossing-1 credit facility
  was not capitalized in the first quarter of 2001.

Provision for income taxes. Bermuda
  does not impose a statutory income tax and consequently the provision for income
  taxes of $2.5 million recorded in the first quarter of 2001 related to
  income earned by certain subsidiaries which are located in jurisdictions which
  impose income taxes.

Net income (loss).Net income (loss) decreased
  $61.1 million to a net loss of $60.7 million in the first quarter
  of 2001, compared to a net income of $0.3 million in 2000.

Proportionate Adjusted EBITDA. For
  the three months ended March 31, 2001, the Proportionate Adjusted EBITDA
  increased to $147.6 million from $61.9 million in the same period of 2000,
  an increase of $85.7 million, or 138%, due primarily to a $109.3 million
  increase in Proportionate Cash Revenue, partially offset by a $23.6 million
  increase in proportionate operating expenses due to growing operating activities.

Liquidity and Capital Resources

We estimate the cost of Pacific Crossing-1
  to be approximately $1.3 billion. We have fully financed Pacific Crossing-1
  through shareholder equity investments, shareholder loans, and the $850.0 million Pacific
  Crossing-1 credit facility, under which $759.5 million was outstanding
  at March 31, 2001.

We estimate the cost of East Asia Crossing
  connecting Japan, Hong Kong, Taiwan, Korea, Malaysia, the Philippines and Singapore
  to be approximately $1.3 billion over the next two years.

On October 12, 2000, we completed
  our initial public offering in which we sold 68 million shares of our Class A
  common stock at a price of $7.00 per share. The net proceeds of the initial
  public offering after deducting underwriting discounts, commissions and costs
  were approximately $451.8 million. On November 8, 2000, an additional 500,000
  shares at $7.00 per share that were sold in connection with the exercise of
  the underwriters over-allotment option. The additional net proceeds were
  approximately $3.3 million, after deducting the underwriters discounts,
  commissions and costs. Concurrent with the initial public offering, we issued
  the senior notes for net proceeds of approximately $389 million. The senior
  notes have a face value of $408 million, mature on October 15, 2010
  and bear an interest rate of 13.375%. Interest on the senior notes is payable
  on April 15 and October 15 of each year, beginning April 15,
  2001. We have used and are using the proceeds of our initial public offering
  and senior note offering for the construction of our network, the expansion
  of our business and general corporate purposes.

Concurrently with the closing of the initial
  public offering, we entered into a subordinated standby credit facility with
  Global Crossing. Under the credit facility, Global Crossing has agreed to lend
  us up to $400 million on a subordinated basis. Global Crossing has committed
  to keep half of this facility available for borrowings until December 31,
  2002, and has committed to keep the remainder of this facility available for
  borrowings until we achieve certain performance targets. We are permitted to
  use the proceeds of the credit facility to pay a portion of the costs of building
  out our network, operating expenses, interest on the credit facility and other
  indebtedness and for general corporate purposes. Borrowings under the credit
  facility will bear interest at a rate of 14.875%. The credit facility will mature
  six months after the maturity date of the Senior Notes, and no principal will
  be payable until maturity. As of March 31, 2001, there was no outstanding
  balance under these loan facilities.

We have extended limited amounts of financing
  to customers in connection with certain capacity sales. Our customer financing
  terms may provide for installment payments of up to four years. We believe that
  the extension of financing to our customers will not have a material effect
  on our liquidity.

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##### Table of Contents



During the first quarter of 2001, Pacific
  Crossing Ltd. has borrowed approximately $34.2 million from us. The interest
  rate of the loans is LIBOR plus 2.5%. The outstanding principals plus accrued
  interests are due one year after the Pacific Crossing-1 credit facility is paid
  in full.

Pacific Crossing Ltd. entered into an OA&M
  agreement with Global Crossing Network Center, Ltd. The agreement is for an
  initial term of eight years with two renewal periods of five years each at Pacific
  Crossing Ltd.s option. The amounts payable under the agreement are $43 million,
  $43 million and $42.2 million for year 2000, 2001 and 2002, respectively.
  These fees will increase by 3.0% each year starting in the year ended December 31,
  2003, through the end of the agreement in 2007.

Under another OA&M agreement, Pacific
  Crossing Ltd. is committed to paying GAL JPY600 million (approximately
  $4.9 million based on the exchange rate at March 31, 2001) each year
  through 2002, increasing by 3.0% thereafter through 2007.

We have agreed to form a joint venture
  company, to be owned 33% by us and 67% by Exodus, to offer a full range of Internet
  operations outsourcing services to customers in Asia, including web-hosting
  services, managed service offerings, professional services and content distribution.
  Pursuant to the joint venture agreement we will contribute $33 million
  in cash and all of our data center and related assets to the joint venture.
  In addition, the board of directors of the joint venture may require us to make
  additional capital contributions of up to $167 million over the three-year
  period following formation of the joint venture.

Net cash provided by operating activities
  was $214.1 million for the first quarter of 2001, compared to $38.9 million
  for the comparable period of 2000. The $175.1 million increase in cash
  flow from operation is mainly attributable to cash received from capacity sales,
  offset by cash used in operations.

Net cash used in investing activities was
  $242.4 million in the first quarter of 2001, which was used for capital
  expenditures and investments.

Net cash used in financing activities was
  $32.3 million in the first quarter of 2001, consisting primarily of net
  repayments of $42.0 million under Pacific Crossing-1 credit facilities,
  partially offset by a $9.7 million proceeds received from capital contribution
  by a joint venture partner.

As of March 31, 2001, we had $644.6 million
  in cash and cash equivalents and $138.9 million in restricted cash and
  cash equivalents.

We have a substantial amount of indebtedness.
  Based upon the current level of operations, our management believes that our
  cash flows from operations, together with the net proceeds from our initial
  public offering of common stock and senior notes, available borrowings under
  Pacific Crossing-1 credit facility, and if necessary, the standby credit facility
  with Global Crossing, will be adequate to meet our anticipated requirements
  for working capital, capital expenditures, discretionary investments, interest
  payments and scheduled principal payments for the foreseeable future. There
  can be no assurance, however, that the business will continue to generate cash
  flow at or above current levels or that currently anticipated improvements will
  be achieved. Also, there can be no assurance that our business and our continued
  ability to raise capital will be adequate to meet our anticipated requirements
  for working capital, capital expenditures, discretionary investments, interest
  payments and scheduled principal payments for the foreseeable future. If we
  are unable to meet current capital needs, we may be required to reduce capital
  expenditures, refinance all or a portion of our existing debt or obtain additional
  financing.

Inflation

We do not believe that our business is
  impacted by inflation to a significantly different extent than the general economy.

Information Regarding Forward-Looking Statements

We have included forward-looking
  statements throughout this Quarterly Report filed on Form 10-Q. These
  forward-looking statements describe managements intentions, beliefs, expectations
  or predictions for the future. We uses the words believe, anticipate,
  expect, intend and similar expressions to identify forward-

15



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##### Table of Contents



looking statements. Such forward-looking statements are subject to a number
  of risks, assumptions and uncertainties that could cause our actual results
  to differ materially from those projected in such forward-looking statements.
  These risks, assumptions and uncertainties include:



| |  |  | the ability to complete systems within the currently estimated
      time frames and budgets;               
| | - |  | ------------------------------------------------------------------------------------------------------------
|
| |  |  | the ability to compete effectively in a rapidly evolving and
      price competitive marketplace;           
|
| |  |  | changes in business strategy;                                                                               
|
| |  |  | changes in the nature of telecommunications regulation in
      the United States, Asia and other countries;
|
| |  |  | the successful integration of newly-acquired businesses; and                                                
|
| |  |  | the impact of technological change.                                                                         

This list is only an example of some of
  the risks, uncertainties and assumptions that may affect our forward-looking
  statements. We undertake no obligation to update any forward-looking statements
  made by it.

Reference is made to our Annual Report
  on Form 10-K for a more complete discussion of the risks, uncertainties
  and other factors that may affect our business.







ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
  RISK

Interest Rate Risk

The table below provides information about
  our market sensitive financial instruments and constitutes a forward-looking
  statement. Our major market risk exposure is changing interest rates.
  Our policy is to manage interest rates through the use of a combination of fixed
  and floating rate debt. Interest rate swaps may be used to adjust interest rate
  exposures when appropriate, based upon market conditions, and we do not engage
  in transactions for speculative purposes.

|                                                |                                             |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         |         |      |   |         |     |  |   |         |       |   |   |         |         |  |   |         |        |  
|----------------------------------------------- | ------------------------------------------- | - | --------------------------------- | --- | ---------- | - | ------ | --- | ---- | - | ------- | --- | ---------- | - | ------- | ------- | ---- | - | ------- | --- |  | - | ------- | ----- | - | - | ------- | ------- |  | - | ------- | ------ | -
|                                                |                                             |   | Expected Year of
        Maturity |     | Fair Value
|                                                |                                             |   |                                   |     | March 31, 
|                                                |                                             |   | 2001                              |     | 2002       |   | 2003   |     | 2004 |   | 2005    |     | Thereafter |   | Total   |         | 2001
|                                                |                                             |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         |         |     
|                                                |                                             |   | (In thousands)                   
|DEBT:                                          
|                                               
|                                               
|                                               
|                                               
|Pacific
          Crossing - 1 Credit Facility  |                                             | $ | 41,630                            |     |            | $ | 88,260 |     |      | $ | 103,260 |     |            | $ | 115,760 |         |      | $ | 117,477 |     |  | $ | 293,104 |       |   | $ | 759,491 |         |  | $ | 759,491 |       
|                                               
|                                               
|                                               
|                                               
|                                                | Average
          interest rates  variable |   |                                   | (1) |            |   |        | (1) |      |   |         | (1) |            |   |         | (1)     |      |   |         | (1) |  |   |         | (1)   |  
|                                               
|                                               
|                                               
|                                               
|Senior
          Notes due 2010                 |                                             |   |                                  |     |            |   |       |     |      |   |        |     |            |   |        |         |      |   |        |     |  | $ | 408,000 |       |   | $ | 408,000 |         |  | $ | 403,165 |       
|                                               
|                                               
|                                               
|                                               
|                                                | Average
          interest rates  fixed    |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         |         |      |   |         |     |  |   |         | 13.38 | %
|                                               
|                                               
|                                               
|                                               
|DERIVATIVE
          INSTRUMENTS:              
|                                               
|                                               
|                                               
|                                               
|Interest
          rate swap floating for fixed |                                             |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         |         |      |   |         |     |  |   |         |       |   |   |         |         |  |   |         |       
|                                                | Contract notional amount                    |   |                                   |    |            |   |        |    |      |   |         |    |            |   | $       | 500,000 |      |   |         |    |  |   |         |      |   |   | $       | 500,000 |  |   | $       | (1,710 | )
|                                               
|                                               
|                                               
|                                               
|                                                | Fixed
          rate paid by counterparty   |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         | (2)     |     
|                                               
|                                               
|                                               
|                                               
|                                                | Floating
          rate paid by the Company |   |                                   |     |            |   |        |     |      |   |         |     |            |   |         | 5.00    | %   



---

(2) The interest rate is one-month
  United States dollar LIBOR, which was 5.00% as of March 31, 2001.

A hypothetical 10% change in interest rate
  would result in an increase or decrease of approximately $4.9 million to
  the fair value of financial instruments with exposures to interest rate risk
  as of March 31, 2001.

16



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##### Table of Contents



Foreign Currency Risk

We transact business in various foreign
  currencies, and are subject to certain foreign exchange risks. We have established
  a foreign currency hedging program utilizing foreign currency forward exchange
  contracts to hedge certain of our foreign currency transaction exposures. Under
  this program, we seek to offset foreign currency transaction gains and losses
  with gains and losses on the forward contracts, so as to mitigate our overall
  risk of foreign currency transaction gains and losses. We do not enter into
  forward contracts for speculative or trading purposes. In April 2001, we
  entered into a foreign exchange forward contract in Japanese yen. The contract
  has a notional value of $23.8 million and matures in July 2001. Notional
  amounts do not quantify market or credit exposure or represent our assets or
  liabilities, but are used in the calculation of cash settlements under the contracts.

17



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##### Table of Contents









PART II. OTHER INFORMATION







Item 1. Legal Proceedings

The Company is not presently subject to
  any material legal claims or proceedings.







Item 2. Changes in Securities and Use of Proceeds

Not applicable.







Item 3. Defaults Upon Senior Securities

Not applicable.







Item 4. Submission of Matters to a Vote of Security Holders

Not applicable.







Item 5. Other Information

None.







Item 6. Exhibits And Reports On Form 8-K

(a) Exhibits

|        |  |                                                                                                                                                                                                                        
|------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit
|Number  |  | Description                                                                                                                                                                                                            
|        |  |                                                                                                                                                                                                                        
|10.1    |  | Asia Global Crossing Senior
        Executive Incentive Compensation Plan (incorporated by reference to Annex
        C to the Registrants definitive proxy statement on Schedule 14A
        filed on April 27, 2001)

(b) Reports on Form 8-K.

During the quarter ended March 31,
  2001, the Company filed no reports on Form 8-K.

18



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##### Table of Contents









SIGNATURE

Pursuant to the requirements of the Securities
  Exchange Act of 1934, the Registrant has duly caused this report to be signed
  on its behalf by the undersigned, thereunto duly authorized.

| |                                                                   |                         
| | ----------------------------------------------------------------- | ------------------------
| | Asia Global Crossing Ltd.                                        
| |                                                                   |                         
| | By:                                                               | /s/ STEFAN C. RIESENFELD
| |                                                                   |                         
| | Name: Stefan C. Riesenfeld
        Title: Chief Financial Officer

May 15, 2001

19