In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.

EXHIBIT 10.14

                          SOFTWARE HOSTING AGREEMENT                                          This Software Hosting Agreement (the Agreement) is entered into and effective as of the later of the two signature dates below (the Effective Date) INKTOMI CORPORATION (Inktomi), a California corporation, 1900 South Norfolk Street, Suite 110, San Mateo, California 94403, and MICROSOFT CORPORATION (Microsoft), a Washington Corporation, One Microsoft Way, Redmond, Washington 98052-6399, with reference to the facts set forth in the Recitals below.

                                   Recitals

     A.   Inktomi develops and markets computer software products, including without limitation a search engine software for searching and indexing information accessible through the Internet.

     B.   Microsoft develops, manufactures, distributes and markets computer software products and services.

     C.   Pursuant to that certain Software Development Agreement between the parties executed as of the Effective Date (the Software Development Agreement), Inktomi is customizing its Internet search engine software for Microsoft.

     D.   Microsoft desires that Inktomi host and maintain the customized search engine on servers owned by Inktomi and located at a facility selected by Inktomi in California, and Inktomi desires to provide such hosting and maintenance services, on the terms and conditions contained herein.

                                   Agreement

Accordingly, Inktomi and Microsoft hereby agree as follows:

     1.   Definitions.           -----------

          1.1  Ancillary Agreements shall mean the following agreements between Inktomi and Microsoft, and all amended versions thereof or successor agreements thereto: (i) the Software Development Agreement of even date herewith; (ii) the Information Services Agreement of even date herewith; (iii) the Loan Agreement of even date herewith, and any and all Promissory Notes and/or New Note executed pursuant thereto; (iv) the Security Agreement of even date herewith; and (v) the Escrow Agreement of even date herewith.

[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

            1.2  Deployment, Hosting and Maintenance Specifications shall mean the specifications for the Services attached to this Agreement as Exhibit A, as it may be amended from time to time by mutual agreement of the parties, which agreement shall not be unreasonably withheld by either party; if and when the Deployment, Hosting and Maintenance Specifications are modified in accordance with Section 2.2 below, the parties shall initial the new Deployment, Hosting and Maintenance Specifications or amendments to the existing Deployment, Hosting and Maintenance Specifications, and immediately following the last initialing such new Deployment, Hosting and Maintenance Specifications or amendments shall automatically be deemed to supercede or supplement (as the case may be) Exhibit A.

          1.3  Hosting Servers shall mean those servers (including both the search engine cluster and the crawling cluster) and other hardware and third party software identified in the Deployment, Hosting and Maintenance Specifications that shall be used to host or service the Microsoft Search Engine and Usage Data.

          1.4  Internet means any systems for distributing digital electronic content and information to end users via transmission, broadcast, public display, or other forms of delivery, whether direct or indirect, whether over telephone lines, cable television systems, optical fiber connections, cellular telephones, satellites, wireless broadcast, or other mode of transmission now known or subsequently developed.

          1.5  Launch Date will mean that date on which the Microsoft Search Engine (other than any so-called beta version) is first generally available for use by the public.

          1.6  Microsoft Search Engine will mean those versions of the Product developed to Microsoft specifications pursuant to said Software Development Agreement and used to generate search results for Microsoft (or for third parties requesting searches through Microsoft) under said Information Services Agreement.

          1.7  Microsoft Site means the Microsoft Web Site(s) or Microsoft application(s) which, when accessed by an end user, will permit the end user to conduct a search of the Internet (or a portion thereof) using the Product; if





Microsoft sublicenses its rights to use the search results generated by the Product hereunder (as permitted under the Information Services Agreement), then the site(s) of such Microsoft sublicensee(s) will be deemed to be Microsoft Site(s).

          1.8  Product shall mean that certain customized search engine software developed by Inktomi for Microsoft pursuant to the Software Development Agreement, as more specifically described in said Software Development Agreement.

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            1.9  Security Measures shall mean those procedures and precautions described in Exhibit A, for maintaining the security of the Product and Usage Data required under this Agreement.

          1.10 Services shall mean the deployment, hosting and maintenance of the Product as described under this Agreement.

          1.11 Term means the period of time commencing on the Effective Date and continuing thereafter indefinitely until this Agreement is terminated pursuant to Section 10 below.

          1.12 Usage Data means such data as Inktomi may collect relating to the usage of (i) the Product by Microsoft and end users, and/or (ii) the Hosting Servers.

          1.13 Web means the so-called World Wide Web, containing, inter alia, Web Pages written in hypertext markup language (HTML) and/or any similar successor technology.

          1.14 Web Indexing Data means such data as Inktomi may collect relating to the documents crawled by its crawling software in connection with its operation of the Product.

          1.15 Web Page means a document on the Web which may be viewed in its entirety without leaving the applicable distinct URL address.

          1.16 Web Site means a collection of inter-related Web Pages.

     2.   Services.           --------

          2.1  Inktomi shall deploy, host and maintain the Product and Hosting Servers in accordance with the Deployment, Hosting and Maintenance Specifications and the other terms and conditions contained in this Agreement. Inktomi agrees that the Services shall be performed in a professional manner and shall be of a high grade, nature, and quality.

          2.2  The parties contemplate that there may be additions, deletions or other changes which may affect the Deployment, Hosting and Maintenance Specifications from time to time during the Term. Subject to Sections 2.2.1 through 2.2.3 below, any such additions, deletions or other changes to the Deployment, Hosting and Maintenance Specifications shall be mutually agreed to by Inktomi and Microsoft. Upon such mutual agreement (or, if mutual agreement is not required, upon notice of any such changes desired by Microsoft), Inktomi shall alter the Services in order to accommodate the revised Deployment, Hosting and Maintenance Specifications.

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                 2.2.1  Inktomi and Microsoft will confer not less frequently than monthly regarding the appropriate size (including hardware requirements) and capacity of the Hosting Server cluster, and Inktomi will supply all available and relevant usage data it may have; Microsoft will specify its capacity desires, and, notwithstanding anything contained herein to the contrary, any and all changes in capacity (including without limitation, number of Hosting Servers and connectivity capacity) requested by Microsoft shall be deemed acceptable to Inktomi, and Inktomi shall conform to such new capacity requirements in accordance with the timetable specified by Microsoft.

               2.2.2  Inktomi will deploy the capacity requested by Microsoft hereunder within the timeframe specified in the Deployment, Hosting and Maintenance Specifications, or as otherwise may be agreed by Microsoft and Inktomi at such time.

               2.2.3  At each monthly conference referred to above in Section 2.2.1, Inktomi will state its good faith estimate of the hardware and capacity needs for itself and its other customers. At its sole cost and expense, Inktomi promptly will provision for such hardware and capacity needs, and supply Microsoft with a list of the hardware provisioned and an officer's certification that Inktomi has made such provisions. Upon Microsoft's request (but not more often than twice in any calendar year), Inktomi will supply Microsoft with documentation evidencing such provisioning.

          2.3  In accordance with its performance of the Services, Inktomi may collect and/or possess Web Indexing Data and Usage Data.

               2.3.1  As between Inktomi and Microsoft, Inktomi will own all rights in and to Web Indexing Data. However, Inktomi will provide Microsoft with access to the Web Indexing Data solely for purposes of managing, marketing and promoting the Microsoft Search Engine.

               2.3.2  All Usage Data shall be owned jointly by Microsoft and





Inktomi, and Inktomi hereby irrevocably assigns to Microsoft an [*] interest therein. However, Inktomi shall not have the right to share any of such Usage Data with third parties (except that Inktomi may include Usage Data as part of gross undifferentiated data which it shares with other search engine customers but does not indicate as Usage Data related to the Microsoft Search Engine).

          2.4  Inktomi shall provide to Microsoft all reports described in the Deployment, Hosting and Maintenance Specifications, in accordance with the terms therein.

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[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

            2.5  Inktomi shall strictly adhere to all Security Measures in performing the Services, including without limitation securing the Usage Data, which it may possess or have under its control from time to time, from unauthorized access and modification.

          2.6  Microsoft will have the right, in its sole and absolute discretion, to require Inktomi to devote a separate cluster of Hosting Servers to servicing Microsoft hereunder, which Servers would not be used to service any needs of Inktomi and/or any third parties. The Hosting Servers purchased by Inktomi at Microsoft's request hereunder would be re-deployed to such separate cluster.

               2.6.1  If Microsoft notifies Inktomi in writing that it desires such a separate cluster, Microsoft shall reimburse Inktomi for all actual, direct expenses incurred and paid by Inktomi for equipment (other than Hosting Servers, which shall be purchased by Inktomi with financing loaned by Microsoft as set forth elsewhere herein) and services of necessary subcontractors (but not services of Inktomi employees) required to create and set up such separate cluster, but Microsoft's obligations to make any payments to Inktomi pursuant to clause (a) of Section 4.1 below will cease and terminate effective on the date such separate cluster becomes operational.

               2.6.2  Nothing contained in this Agreement will be deemed to require Microsoft to deploy the Product in Hosting Servers owned by Inktomi, or to require Microsoft to continue to utilize Inktomi's services to host the Product at any time during the Term; without limitation, Microsoft will have the right to deploy the Product, in whole or in part, at other site(s) (whether owned by Microsoft or third parties) during the Term. If Microsoft elects to deploy and operate the Product at other sites, Inktomi will take all steps necessary or appropriate to facilitate such other deployment and operation; without limitation, Inktomi will move any and all Hosting Servers to any location(s) designated by Microsoft (costs of relocation, including shipping and insurance, to be borne exclusively by Microsoft), and Inktomi will provide training to Microsoft personnel and/or others designated by Microsoft to enable them to satisfactorily operate and maintain the Product and Hosting Servers wherever located. Notwithstanding anything to the contrary contained in this Agreement, Microsoft will not be obligated to make any payments to Inktomi pursuant to clauses (a), (e) and/or (f) of Section 4.1 below if Microsoft exercises its rights to move the Hosting Servers under this Section 2.6.2.

          2.7  Inktomi will assign two (2) full-time Inktomi employees exclusively dedicated to maintenance duties hereunder. Such employees are identified in Exhibit D attached hereto; and their replacements shall be subject to Microsoft's prior written approval (which approval Microsoft will not unreasonably withhold). Notwithstanding the foregoing, if Microsoft and Inktomi mutually agree in writing, additional Inktomi employees may be required to be assigned to maintenance duties hereunder.

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            2.8  Microsoft acknowledges that Inktomi has customized and provided, and will continue to customize and provide, its software and technology to other parties for use in connection with a variety of applications, including search engine applications. Except as may be expressly provided to the contrary elsewhere in this Agreement, nothing in this Agreement will be deemed to (i) limit or restrict Inktomi from customizing and providing its software and technology to other parties for any purpose, including in connection with search engine applications, or (ii) in any way affect the rights granted to such other parties. Microsoft further acknowledges that in addition to utilizing the Hosting Servers to host the Product, Inktomi may also use the Hosting Servers to service its own needs and the needs of other third parties, unless Microsoft elects to use a separate cluster in accordance with Section 2.6 above (it being understood that Inktomi will estimate the capacity for servicing the needs of itself and its other customers in good faith and provision accordingly, in accordance with Section 2.2).

     3.   Hosting Servers.           ---------------

          3.1  Inktomi shall own all new Hosting Servers purchased by Inktomi pursuant to Microsoft's request hereunder.

               3.1.1  To the extent Inktomi is required to do so in order to meet Microsoft's capacity requests under the Deployment, Hosting and Maintenance Specifications (as the same may change from time to time), Inktomi shall purchase new Hosting Servers. Prior to purchasing any such new Hosting Servers, Inktomi will seek bids from third parties, copies of which Inktomi will provide





to Microsoft, and Microsoft will have the right to approve all such purchases and the applicable purchase prices. Inktomi shall use commercially reasonable efforts to minimize the purchase prices of such new Hosting Servers, but in any event such purchase prices will not be more than any comparable equipment purchased by Inktomi during the same time frame. Inktomi will consult with Microsoft regarding the proposed purchase prices of all new Hosting Servers prior to purchasing the same, and if Microsoft is aware of a vendor who is willing to sell Hosting Servers to Inktomi at a lower purchase price than as proposed by Inktomi, Inktomi agrees to purchase the applicable new Hosting Servers from such vendor.

               3.1.2  Notwithstanding Section 3.1.1 above, Inktomi shall have no obligation whatsoever to purchase any new Hosting Servers unless Microsoft loans Inktomi an amount equal to the purchase price thereof pursuant to the Loan Agreement between Inktomi and Microsoft of even date herewith (the Loan Agreement).

          3.2  Microsoft acknowledges that, pursuant to Inktomi's contractual arrangement with its subcontractor, Exodus Communications, Inc. (Exodus), Inktomi will locate the Hosting Servers at the facilities of Exodus, and Exodus will provide power and Internet telecommunications services to the Hosting Servers. However, Microsoft will have no obligations or liabilities to Exodus, Inktomi will remain liable for providing all

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  Services to Microsoft notwithstanding its arrangement with Exodus, and Inktomi will [*] and [*] against from any and all [*] to [*] (in accordance with the procedures specified in Section [*] below). A copy of the contract(s) between Inktomi and Exodus is/are attached hereto as Exhibit [*], and Inktomi shall not modify said contract(s) or replace Exodus as its subcontractor for the applicable services (including without limitation by having Inktomi perform the Services directly) without Microsoft's prior written approval (which approval Microsoft agrees to not unreasonably withhold). Inktomi shall provide Exodus with a copy of the Security Measures applicable under this Agreement and will use commercially reasonable efforts to ensure that Exodus strictly adheres to all such Security Measures.

          3.3  Subject to Microsoft's rights under Section 2.6.2 above and/or the Security Agreement between Inktomi and Microsoft of even date herewith, executed in accordance with the Loan Agreement, Microsoft shall not have any access to the Hosting Servers, except as follows: (i) Microsoft will have electronic read-only access to real time system data on the status of the usage, accessibility and performance of the Microsoft Search Engine (via software developed by Inktomi in consultation with Microsoft), and (ii) Microsoft will have the right, upon reasonable notice and during normal business hours, to have representatives escorted by Inktomi employees tour the premises where the Hosting Servers are located as necessary to ensure Microsoft's satisfaction with the operation of the physical plant and equipment. Microsoft agrees to comply with the Security Measures at all times when accessing the Hosting Servers as permitted hereunder.

     4.   Payment For Services.           --------------------

          4.1  As full and complete compensation for the Services, Microsoft shall pay to Inktomi the following monthly fees:

               (a)  beginning with the Launch Date, the sum of [*] [*] Dollars ($[*]) (attributable to the use during the Term of the Hosting Servers owned by Inktomi as of the Effective Date), provided that in no event will Microsoft be obligated to make more than [*] ([*]) monthly payments pursuant to this clause (a), and if the Term extends beyond [*] years after the Launch Date, this clause (a) will be deemed deleted from this Agreement effective on the [*] anniversary of the Launch Date notwithstanding anything to the contrary contained herein;

               (b)  an amount equal to [*] ([*]) of the [*], [*], [*], [*] thereon, incurred by Inktomi to purchase each new Hosting Server required to service Microsoft's needs in accordance with Section 3.1 above (attributable to the use during the Term of such new Hosting Servers); such payments will commence with respect to each new Hosting Server at such time as Inktomi's repayment obligations begin with respect to such new Hosting

                                       7

[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

  Server pursuant to the Loan Agreement and the applicable Promissory Note. Notwithstanding section 4.2 below, such payments shall be due in immediately available funds on the first business day of each month. The parties acknowledge that the monthly fee under this clause (b) will increase throughout the Term if and to the extent that Microsoft's Hosting Server requirements increase, but, notwithstanding anything contained herein to the contrary, no amounts shall be payable under this clause (b) attributable to any Hosting Server which is more than [*] years old;

               (c)  an amount equal to the [*] and [*] of the new Hosting Servers purchased by Inktomi pursuant to Section 3.1 above ([*] any amounts paid by Inktomi to Exodus for such services or attributable to the employees referred to in clause (f) below), payable if and when Inktomi pays such maintenance





costs; Inktomi will use its commercially reasonable efforts to ensure that the annual hardware and software maintenance costs for each such new Hosting Server are not more than [*] percent ([*]%) of the purchase price of such New Hosting Server, and Microsoft will not be obligated to pay higher maintenance costs than such [*]% annual estimate without its prior written consent;

               (d)  an amount equal to [*] Percent ([*]%) of the sum of the amounts payable under clauses (b) and (c) above (attributable as Inktomi's management fee for providing the Services);

               (e)  an amount equal to Microsoft's [*] of the [*] [*] by Inktomi to Exodus in connection with the applicable Hosting Servers cluster, computed in accordance with Exhibit [*], [*] the [*] new Hosting Servers are [*] at Exodus; and

               (f)  an amount equal to [*] per month per person identified in Section 2.7 above, [*] of the new Hosting Servers.

In addition, if the number of ADH (as defined in the Software Development Agreement and Information Services Agreement) should exceed the capacity requested by Microsoft, or if Inktomi's usage of its estimated capacity requirements should exceed its estimates as communicated to Microsoft in accordance with Section 2.2.1 above, then Microsoft's applicable payment(s) hereunder will be [*] in [*] with the [*] set forth in Exhibit [*] hereto.

          4.2  Except as set forth in Section 4.1(b) above, Inktomi shall supply to Microsoft written invoices for all amounts due under this Agreement, and payments will be due net [*] ([*]) days from Microsoft's receipt of such invoice. Inktomi shall bear sole responsibility for all expenses incurred in connection with the performance of the Services, unless otherwise set forth herein or agreed to in writing by Microsoft.

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[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

            4.3  Inktomi shall keep true and accurate books and records, in accordance with Generally Accepted Accounting Principles (GAAP), relating to all costs and expenses for which Inktomi is entitled to charge Microsoft pursuant to Section 4.1 above, throughout the Term and for eighteen (18) additional months thereafter. Inktomi will permit Microsoft to have access to, and to make copies of, all such books and records for purposes of auditing and verifying such costs and expenses, provided that Microsoft shall give Inktomi reasonable notice prior to each requested audit and shall perform such audit during normal business hours at Inktomi's office(s) where such records are normally kept. If any Microsoft audit should determine that Inktomi overcharged Microsoft by an amount of [*]% or more for the period audited, then in addition to any and all other rights and remedies Microsoft may have under the circumstances, Microsoft may require Inktomi to reimburse it for all costs it incurred relating to such audit.

          4.4  Taxes.                -----

               4.4.1  All amounts to be paid by Microsoft to Inktomi herein are exclusive of any federal, state, local, municipal or other governmental taxes, including, without limitation, taxes based on, imposed on or measured by net or gross income or receipts, franchise taxes, taxes on doing business, capital stock taxes (including any minimum taxes and taxes measured by any item of tax preference), sales, use, excise, property, withholding or similar taxes, duties, levies, fees, excises or tariffs (all such taxes and other charges collectively Taxes) now or hereafter imposed on Inktomi under applicable law (the Inktomi Taxes). Microsoft is not liable to Inktomi for any Taxes incurred in connection with this Agreement, unless they are (i) owed by Microsoft under applicable law solely as a result of entering into this Agreement (ii) are based solely upon the amounts payable under this Agreement, and (iii) are required to be collected from Microsoft by Inktomi under applicable law, provided, however, that solely with respect to sales tax or use tax payable to those taxing jurisdictions that impose sales or use taxes under applicable law upon the vendor, rather than the purchaser, clause (i) above shall be modified to provide sales taxes or use taxes that are owed by Inktomi under applicable law solely as a result of entering into this Agreement and clause (iii) shall be modified to provide are permitted to be collected from Microsoft by Inktomi under applicable law. (Such Taxes as are described in clauses (i), (ii) and (iii) above, the Invoiced Taxes.) The Invoiced Taxes shall be stated separately as applicable on Inktomi's invoices and shall be remitted by Microsoft to Inktomi. Inktomi shall promptly provide to Microsoft official tax receipts indicating that such Invoiced Taxes have been collected by Inktomi. Microsoft may provide to Inktomi an exemption certificate acceptable to Inktomi and to the relevant taxing authority (including without limitation a resale certificate) in which case Inktomi shall not collect the Taxes covered by such certificate. Inktomi agrees to take such steps as are reasonably requested by Microsoft to minimize such Invoiced Taxes in accordance with all relevant laws and to reasonably cooperate with and assist Microsoft, at Microsoft's request, in challenging the validity of any Invoiced Taxes or other Taxes paid directly by Microsoft to the relevant taxing authority. Inktomi shall indemnify and hold Microsoft

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[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO





THE OMITTED PORTIONS.

  harmless from any Taxes, penalties, interest, or additions to tax arising from amounts paid by Microsoft to Inktomi under this Agreement that are asserted or assessed against Microsoft to the extent such amounts are related to Invoiced Taxes paid to Inktomi by Microsoft under this section. Other than the Invoiced Taxes, all Inktomi Taxes shall be the responsibility of Inktomi and may not be passed on to Microsoft. Inktomi takes full responsibility for all such Inktomi Taxes, including penalties, interest and other additions thereon and agrees to indemnify, defend and hold Microsoft harmless from any claims, causes of action, costs (including without limitation, reasonable attorneys' fees), penalties, interest charges and other liabilities of any nature whatsoever associated therewith. All Taxes that are imposed on Microsoft under applicable law (the Microsoft Taxes) shall be the responsibility of Microsoft and may not be passed on to Inktomi. Microsoft takes full responsibility for all such Microsoft Taxes, including penalties, interest and other additions thereon and agrees to indemnify, defend and hold Inktomi harmless from any claims, causes of action, costs (including without limitation, reasonable attorneys' fees), penalties, interest charges and other liabilities of any nature whatsoever associated therewith.

          4.4.2  In the event that Taxes are required to be withheld on payments made hereunder by any U.S. (state, local or federal) or foreign government, Microsoft may deduct such Taxes from the amount owed Inktomi and pay them to the appropriate taxing authority. Microsoft shall in turn promptly secure and deliver to Inktomi an official receipt for any Taxes withheld. Inktomi may provide to Microsoft an exemption certificate acceptable to Microsoft and to the relevant taxing authority (including without limitation a resale certificate) in which case Microsoft shall not collect the Taxes covered by such certificate. Microsoft agrees to take such steps as are reasonably requested by Inktomi to minimize such Taxes in accordance with all relevant laws and to reasonably cooperate with and assist Inktomi, at Inktomi's request, in challenging the validity of any such Taxes.

          4.4.3  Inktomi agrees and acknowledges that it will be responsible for all of its federal and state taxes, withholding, social security, unemployment and other related taxes, insurance, and other benefits, and all salaries, benefits, and other costs of its employees.

     5.   Ownership of the Product. The parties respective rights in and to the           ------------------------                                               Product will be as set forth in the Software Development Agreement and the Information Services Agreement of even date herewith, and nothing contained in this Agreement shall be deemed to modify such rights allocation.

  6.      Confidentiality.           ---------------

     6.1  The parties hereby agree that all terms and conditions of that certain Microsoft Corporation Non-Disclosure Agreement between them dated March 18, 1997, shall govern the disclosure of confidential and proprietary information made under this

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  Agreement. In this connection, the parties hereby agree that the terms of this Agreement shall be treated as confidential in accordance with the terms of said Non-Disclosure Agreement.

          6.2  Without having first sought and obtained Microsoft's written approval (which Microsoft may withhold in its sole and absolute discretion), Inktomi shall not, directly or indirectly, (i) trade upon this transaction or any aspect of Inktomi's relationship with Microsoft, or (ii) otherwise deprecate Microsoft technology.

          6.3  Inktomi shall use its reasonable commercial efforts to cause Exodus to execute a non-disclosure agreement with Microsoft which includes substantially similar restrictions as are contained herein.

          6.4  Neither party will issue any press release or make any public announcement(s) relating in any way whatsoever to this Agreement or the relationship established by this Agreement without the express prior written consent of the other party. However, the parties acknowledge that this Agreement, or portions thereof, may be required under applicable law to be disclosed, as part of or an exhibit to a party's required public disclosure documents. If either party is advised by its legal counsel that such disclosure is required, it will notify the other in writing and the parties will jointly seek confidential treatment of this Agreement to the maximum extent reasonably possible, in documents approved by both parties and filed with the applicable governmental or regulatory authorities. Notwithstanding the foregoing, Microsoft and Inktomi will cooperate to create a mutually approved joint press release regarding the non-confidential aspects of this Agreement, which press release shall be issued by each party on the Launch Date; provided, however, that the precise timing of such press release shall be subject to the approval of Microsoft (in its sole and absolute discretion).

     7.   Representations and Warranties.           ------------------------------

          7.1  Microsoft warrants and represents that it has the full power to enter into this Agreement and perform its obligations hereunder.

          7.2  Inktomi warrants and represents that:





               7.2.1  It has the full power to enter into this Agreement and perform its obligations hereunder, and Inktomi's performance of such obligations will not violate any terms and conditions of other agreements entered into by Inktomi with [*] ([*]);

               7.2.2  Inktomi's [*] and [*] of the Product shall [*] to the [*] and [*],                                        11

[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

  provided, however, that a [*] and [*] to so [*] will not be [*] to be a [*] hereunder; and

               7.2.3  Notwithstanding any [*] to [*] hereunder, or to any other [*], Inktomi shall remain [*] for the [*] hereunder in accordance with [*].

     8.   Indemnification.           ---------------

          8.1  Each party shall, at the expense of such party (the Indemnifying Party) and at the request of the other party (the Indemnified Party), defend [*] party claim or action brought against the Indemnified Party, and/or the [*] and [*] which, [*], (i) would constitute a [*] of [*], [*] or [*] made by the Indemnifying Party under this Agreement; or (ii) would [*] of the Indemnifying Party's [*]; and the Indemnifying Party will [*] and [*] the Indemnified Party [*] and [*], [*] and [*] incurred by the Indemnified Party, including but [*] to [*] of [*] and [*], that are attributable to such claim. The Indemnified Party shall: (x) provide the Indemnifying Party reasonably prompt notice in writing of any such claim or action and [*] the Indemnifying Party, through counsel [*] to Microsoft and Inktomi, to [*] and [*] such claim or action; and (y) provide the Indemnifying Party [*], [*] and [*] at the [*] Party's [*], to [*] the Indemnifying Party to [*] such claim or action. The Indemnifying Party will [*] for [*] made by the [*] Party without the [*] Party's [*], which [*] will [*].

          8.2  The Indemnified Party shall have the right to employ separate counsel and participate in the defense of any claim or action. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payments made or loss suffered by it at any time after the date hereof, based upon the judgment of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands, or actions, in respect to any damages related to any claim or action under this Section 8.

          8.3  The Indemnifying Party may [*] any claim or action under this Section 8 on the Indemnified Party's behalf [*] the [*], which [*] will [*]. In the event Microsoft and Inktomi agree to settle a claim or action, the each party agrees not to publicize the settlement without first obtaining the other party's written permission, which permission will not be unreasonably withheld.

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[*]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO  THE OMITTED PORTIONS.

            9.   LIMITATION OF LIABILITY. EXCEPT FOR [*] CAUSED BY A [*] OF                ----------------------- SECTION [*], NEITHER PARTY SHALL BE [*] (IN [*] WITH OR PURSUANT TO THIS AGREEMENT AND THE ANCILLARY AGREEMENTS TAKEN AS A WHOLE) FOR ANY [*], [*] OR [*] [*] (INCLUDING [*]) [*] OF [*] ([*]) [*] OF THE [*] OF [*], EVEN IF [*] HAD BEEN [*] OF THE [*] OF SUCH [*].        10.  Termination and Other Remedies.           ------------------------------

          10.1 Inktomi may terminate this Agreement without cause upon one year's prior written notice, provided that such notice may not be given prior to the second anniversary of the Launch Date.

          10.2 Microsoft may terminate this Agreement at any time without cause upon [*] ([*]) days prior written notice. Upon receipt of such notice, Inktomi will discontinue all work hereunder. If Microsoft terminates this Agreement without cause pursuant to this Section 10.2, then Microsoft will pay for all services provided by Inktomi up until the date of termination under this Section 10.2. Notwithstanding anything contained herein to the contrary, should Microsoft exercise its termination right pursuant to this Section 10.2, then Inktomi will have the right to elect, in writing within fifteen (15) days after receipt of Microsoft's notice of termination hereunder, either one of the following two options for a early termination penalty:

                (a)   Inktomi may require Microsoft to pay to Inktomi, in  [*] immediately following the effective termination date, an amount equal to [*] ([*]) of all outstanding principal, interest and other amounts owed or owing to Microsoft by Inktomi on the date of termination under the Loan Agreement (and outstanding Promissory Notes issued thereunder); or

               (b)    Inktomi may deliver that portion of the Collateral (as defined in the Loan Agreement) which was purchased with Advances evidenced by the then-outstanding Promissory Notes (as defined in the Loan Agreement) (the Returned Collateral) to Microsoft, and assign all right, title and interest in





and to said Returned Collateral to Microsoft, and promptly upon such delivery and assignment Inktomi may require Microsoft to pay to Inktomi, in [*]  immediately following the effective date of termination, an amount equal to [*] ([*]) of all outstanding principal, interest and other amounts owed or owing to Microsoft by Inktomi on the date of termination under the Loan Agreement (and outstanding Promissory Notes issued thereunder); provided, however, that the following conditions must be satisfied for Inktomi to be entitled to elect this alternative (b)-

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            (i)    Inktomi then owns all of the Returned Collateral and has [*]      the Returned Collateral [*], and [*] other than Lender;

          (ii)   Inktomi obtains any [*] reasonably required by Microsoft from      Inktomi's [*];

          (iii)  the Returned Collateral is returned in good condition and      repair, without any waste or unusual or unreasonable depreciation of      Returned Collateral;

          (iv)   Inktomi has not committed any act for which any portion of the      Returned Collateral might be confiscated by any governmental or private      entity;

          (v)    Inktomi has paid all taxes, assessments or similar obligations      affecting the Returned Collateral that are then due or have then accrued;

          (vi)   Inktomi [*] to Microsoft [*] that [*] of the [*] is [*] and      [*]; and

          (vii)  Inktomi, [*], arranges to deliver the Returned Collateral in a      manner and to a location designated by Microsoft.

In the event Inktomi elects this alternative (b), the Security Agreement executed in connection with the Loan Agreement shall terminate on the business day immediately following the date of delivery and assignment of all the Returned Collateral to Microsoft.

          10.3   Subject to Section 12.9 below, in the event the Microsoft Search Engine is inaccessible to Microsoft, due to a problem other than one with Microsoft's servers or the telecommunication line from Microsoft to the Hosting Servers, for twenty-four (24) consecutive hours, or for forty-eight (48) hours or more in any seventy-two (72) hour period, or for seventy-two (72) hours or more in any one week period, and such inaccessibility is due to any reason other than Microsoft's breach of its obligations under this Agreement, then Microsoft may suspend performance and/or terminate this Agreement immediately with no further obligation.

          10.4   Microsoft may suspend performance and/or terminate this Agreement immediately upon written notice at any time if:

                 (a)  Inktomi is in [*] of this Agreement (excluding Section [*]) and fails to cure that breach within [*] ([*]) days after written notice thereof; or

                 (b)  Inktomi is in material breach of Section [*]; or

                                       14

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                   (c)  Inktomi becomes insolvent or makes any assignment for the benefit of creditors or similar transfer evidencing insolvency; or suffers or permits the commencement of any form of insolvency or receivership proceeding; or has any petition under any bankruptcy law filed against it, which petition is not dismissed within sixty (60) days of such filing; or has a trustee or receiver appointed for its business or assets or any part thereof.

          10.5   Inktomi may suspend performance and/or terminate this Agreement immediately upon written notice at any time if:

                 (a)  Microsoft is in [*] of this Agreement (excluding Section [*]) and fails to cure that breach within [*] ([*]) days after written notice thereof; or

                 (b)  Microsoft is in material breach of Section [*]; or

                 (c)  Microsoft becomes insolvent or makes any assignment for the benefit of creditors or similar transfer evidencing insolvency; or suffers or permits the commencement of any form of insolvency or receivership proceeding; or has any petition under any bankruptcy law filed against it, which petition is not dismissed within sixty (60) days of such filing; or has a





trustee or receiver appointed for its business or assets or any part thereof.

          10.6   If Inktomi is in material breach of this Agreement, then Microsoft will have the right to withhold payment of amounts otherwise owed by Microsoft to Inktomi pursuant to this and/or any Ancillary Agreement; provided, however, that Microsoft shall give Inktomi not less than [*] ([*]) days to cure such breach prior withholding any such payments.

          10.7   A breach of this Agreement by either party will also constitute a breach by such party of each and every Ancillary Agreement; and a breach by either party of any Ancillary Agreement will also consitute a breach of this Agreement by such party.

          10.8   In the event of termination or expiration of this Agreement for any reason, Sections 1, 2.3, 4.3, 4.4, 5, 6.1, 7, 8, 9 and 12 shall survive termination. Except as otherwise expressly provided in this Agreement, Inktomi shall turn over to Microsoft all work in progress, software, and any other materials provided by Microsoft to Inktomi under this Agreement promptly following termination or expiration. Neither party shall be liable to the other for damages of any sort resulting solely from such party terminating this Agreement in accordance with its terms.

                                       15

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            10.9   The rights and remedies given to the parties under this Section 10 are in addition to any other rights and/or remedies that the parties may have under the circumstances, all of which are expressly reserved.

     11.  International Deployment, Hosting & Maintenance Obligations of           -------------------------------------------------------------- Inktomi. Microsoft will have the right to require Inktomi to purchase new - ------- Hosting Servers, and/or to arrange for and perform such deployment, hosting and maintenance services, as Microsoft may determine in connection with international versions of the Product throughout the Term, on the same terms and conditions as applicable hereunder with respect to the original version of the Product directed toward the U.S. market, including without limitation requiring Inktomi to establish, deploy and maintain a cluster of Hosting Servers anywhere in the world (including [*]) designated by Microsoft. If and when Microsoft requires such undertakings by Inktomi, it will so notify Inktomi in writing, whereupon Inktomi will perform such undertakings as requested as expeditiously as reasonably possible.

     12.  Miscellany.           ----------

          12.1   Neither party shall represent itself as the agent or legal representative of the other for any purpose whatsoever, and neither party shall have the right to create or assume for the other any obligation of any kind. This Agreement shall not create or be deemed to create an agency, partnership, franchise, employment relationship or joint venture between the parties. Each party's employees who perform services related to this Agreement shall remain under the exclusive direction and control of their respective employer and shall receive such salaries, compensation and benefits as their respective employer may from time to time determine. Each party shall have full and sole responsibility for its employees who perform any service related to this Agreement with regard to compliance with all applicable laws, rules and regulations governing such party relating to employment, labor, wages, benefits, taxes and other matters affecting its employees.

          12.2   Any notice required or permitted to be given under this Agreement shall be made in writing and shall be deemed to have been given or made if it is in writing and is: (i) delivered in person, (ii) sent by same day or overnight courier, (iii) mailed by certified or registered mail, return receipt requested, postage prepaid, addressed to the party at its address set forth below or at such other address as such party may subsequently furnish to the other party by notice hereunder, or (iv) delivered by facsimile, the transmittal of which shall be confirmed by a telephone call to the other party and by dispatch of a confirming copy of the transmittal by registered or certified mail, postage prepaid. Notices will be deemed effective on the date of delivery in the case of personal delivery, or three (3) business days after mailing, or on the date of dispatch in the case of notification by facsimile (assuming confirmation of transmission). The parties' addresses for purposes of notice shall be as set forth above, provided that all notices to Inktomi shall be sent to the

                                       16

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  attention of General Counsel; and all notices to Microsoft shall be sent to the attention of Shirish Nadkarni, with a copy to: Law & Corporate Affairs, U.S. Legal.

          12.3   This Agreement shall be construed, enforced, performed and in all respects governed by and in accordance with the laws in the State of Washington. In any action or suit to enforce any right or remedy under this





Agreement the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs.

          12.4   In the event any provision of this Agreement is rendered null, void or otherwise ineffective, then (i) the parties agree to negotiate in good faith an acceptable alternative provision which reflects as closely as possible the intent of the unenforceable provision and (ii) notwithstanding, and regardless of whether the parties reach agreement after the good faith negotiations described in clause (i) immediately above, the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby and shall remain in full force and effect. Section and all other headings used herein are provided for convenience only and are not to be given any legal effect or considered in interpreting any provision of this Agreement. No provision of this Agreement shall be interpreted against any party because such party or its legal representative drafted such provision.

           12.5  Except as expressly permitted hereunder or in Exhibit F hereto, neither party may transfer, assign or sublicense this Agreement, or any rights or obligations hereunder, whether by contract or by operation of law, except with the express written consent of the other party, and any attempted transfer, assignment or sublicense by a party in violation of this Section shall be void. For purposes of this Agreement, an transfer under this Section shall be deemed to include, without limitation, the following: (a) a merger or any other combination of an entity with another party (other than a reincorporation of Inktomi from the State of California to the State of Delaware), whether or not the entity is the surviving entity; (b) any transaction or series of transactions whereby a third party acquires direct or indirect power to control the management and policies of an entity, whether through the acquisition of voting securities, by contract, or otherwise; (c) in the case of Inktomi, the sale or other transfer of Inktomi's search engine business or any other substantial portion of Inktomi's assets (whether in a single transaction or series of transactions), or (d) the transfer of any rights or obligations in the course of a liquidation or other similar reorganization of an entity (other than a reincorporation of Inktomi from the State of California to the State of Delaware). Neither party will unreasonably withhold or delay its consent to a requested transfer, assignment or sublicense. Subject to the provisions of this Section, this Agreement shall be binding upon and inure to the benefit of each party and their respective successors and assigns.

          12.6   All rights and obligations of the parties hereunder are personal to them. Except as otherwise specifically stated herein, this Agreement is not intended to benefit, nor shall it be deemed to give rise to, any rights in any third party.

                                       17

            12.7   Each party shall be responsible for compliance with all applicable laws, rules and regulations, if any, related to the performance of its obligations under this Agreement.

          12.8   No waiver of any breach of any provision of this Agreement shall constitute a waiver of any prior, concurrent or subsequent breach of the same or any other provisions hereof or thereof, and no waiver shall be effective unless made in writing and signed by an authorized representative of the waiving party.

          12.9   Neither party shall be liable hereunder by reason of any failure or delay in the performance of its obligations hereunder during any event of force majeure.

          12.10  The parties acknowledge that there may be instances during the Term when, notwithstanding the Non-Disclosure Agreement referred to in Section 6.1 above, Inktomi will not wish to disclose or have Microsoft become aware (through inspection or otherwise) of certain confidential and proprietary information of Inktomi relating to its business and/or technology. In those instances, the parties agree to work together in a spirit of cooperation to work around such disclosure so that Inktomi is able to perform the Services to Microsoft's reasonable satisfaction and otherwise discharge its obligations under this Agreement without making such disclosure.

          12.11  This Agreement, along with the Ancillary Agreements, together contain the entire agreement of the parties with respect to the premises, and may not be modified or amended except by a written instrument executed by the party sought to be charged or bound thereby.

     13.  Insurance. Inktomi will maintain insurance (including but not limited           --------- to liability and property insurance covering the Hosting Servers and Inktomi's operation thereof) in accordance with the requirements set forth in the Software Development Agreement and Loan Agreement between the parties of even date herewith. Executed as of the Effective Date on the signature dates below.

INKTOMI CORPORATION                         MICROSOFT CORPORATION       /s/ DAVID C. PETERSCHMIDT                   /s/ LAURA JENNINGS  By: _________________________               By: _________________________   David C. Peterschmidt, CEO                  Laura Jennings  ______________________________              ______________________________ (printed name and title)                      (printed name and title)





            July 24                                      7/27 Date: ____________________, 1997            Date: ____________________, 1997

                                       18

                                     EXHIBIT A

   DEPLOYMENT, HOSTING AND MAINTENANCE SPECIFICATIONS AND SECURITY MEASURES                                                                                                                                                           (32 pages follow)

                                     EXHIBIT A                                    ---------

YUKON REQUIREMENTS FOR THE INKTOMI SEARCH SERVICE MICROSOFT CONFIDENTIAL - --------------------------------------------------------------------------------

VERSION:            1.0 STABILITY:          High FILENAME:           Yukon requirements for Inktomi search service.doc DATE:               07/07/97 3:57 PM AUTHOR(S):          William Jones   wjones

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                                 Table of Contents

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  1.   OVERVIEW ================================================================================

The goal of this document is to provide a reasonably complete list of Yukon requirements for the Inktomi search service.  Note that a number of the requirements in this document are met by the existing search service but are included anyway for the sake of completeness.

The Section 2 lists all requirements according to area (Performance and Scalability, Reliability and Fault Tolerance, ...) together with information on Target Release and Due Date as defined below.  The Appendix (Section 7) follows a similar organization and provides more detail on the requirements..

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                                     EXHIBIT B

                    CONTRACT(S) BETWEEN INKTOMI AND EXODUS

                                     EXHIBIT C

                            PRO-RATION METHODOLOGY

ALLOCATION OF EXODUS OPERATING COSTS

Exodus charges a monthly fee for facility space, fire suppression, air     conditioning, security, electricity, support services and Internet    connectivity. Inktomi is obliged to contract for this capacity in advance.    The connectivity is currently itemized and charged at a current rate of    [*].

[*] will be according to the [*] provisioned.

Example: [*] - [*] per day, [*] per day [*]. [*] of Exodus charges, [*] of    Exodus charges [*].

[*] will be charged to [*] only for their share of [*]

Current estimate is that [*]; this would be [*].

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                                     EXHIBIT D

                         INKTOMI MAINTENANCE EMPLOYEES

                                  [*] and [*]

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                                     EXHIBIT E

                          OVER-UTILIZATION ADJUSTMENT

In the event that one party under-provisions its portion of the shared Inktomi hosting cluster such that its [*] are [*] by the [*], there will be a charge on a [*] levied against the under-provisioned party.

If [*] for a [*] exceeds its agreed capacity provisioning (as determined in accordance with Sections 2.2 and 2.8, then Microsoft's [*] will be [*] ([*] if the [*] is by [*], or [*] if such [*] is by [*]) in accordance with the following computation: [*] the [*] ([*]) times the [*] of the provisioned capacity ([*]). Note that the over-utilization could apply to [*] in any [*].

[*] will be calculated each month by taking the [*] of the Inktomi [*] without regard to [*] ([*]) [*] ([*]) [*] by the agreed total [*] provisioned.

[*] will be calculated for each party each month by [*] the number of [*] ([*] the [*] in the [*]) from the number of [*] for the [*].





Example:

     Assumptions:      1. Microsoft provisioned capacity is [*]      2. Inktomi provisioned capacity is [*]      3. [*] in [*] is $[*]      4. [*] is [*] for a [*]      5. [*] is [*] for that [*]

     [*] = $[*] = $[*]

     [*] = [*]  = [*]

     Over-Utilization Adjustment = [*] = $[*]              [*] in such [*] payable by [*]

Notwithstanding anything contained herein to the contrary, if a party shall have [*] its provisioned capacity by [*] in any month, such party shall be deemed [*] for its [*] during such month as soon as possible.

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                                     EXHIBIT F                                    ---------

                              Transfer by Inktomi                               -------------------

If Inktomi requests Microsoft's consent to a transfer as described in clause (a) of Section 12.5 of this Software Hosting Agreement to which this Exhibit F is  appended, and Microsoft reasonably withholds its consent to such transfer (an  Unconsented Transfer), then Inktomi will nevertheless have the right to  transfer this Agreement in connection with its proposed Unconsented Transfer  subject to the following conditions precedent to the Unconsented Transfer:

(i)   Inktomi, at its sole cost and expense, and without any financing supplied by Microsoft, will create a separate cluster of Hosting Servers for Microsoft required to service Microsoft's reasonably anticipated needs for a period of twelve months after the commencement of operation of such new and relocated cluster [provided however that Microsoft will purchase, or fund (in accordance with the Loan Agreement) Inktomi's of, (whichever Microsoft elects) any new hosting servers beyond the Hosting Servers purchased by Inktomi under said Software Hosting Agreement necessary to service Microsoft's reasonably anticipated needs as set forth above];

(ii)  Inktomi will relocate, at its sole cost and expense (including, without  limitation, indemnifying Microsoft and holding it harmless against any and all  Taxes that arise as a direct or indirect result of the relocation of the Hosting Servers), all Hosting Servers referred to in clause (i) to a location designated by Microsoft, in its sole discretion;

(iii) Inktomi, at its sole cost and expense, will provide training to Microsoft  personnel to the extent requested by Microsoft, to enable such personnel to use  and maintain the Microsoft Search Engine, and to create enhancements thereto,  with reasonable competence (all as determined by Microsoft in its sole discretion);

(iv)  Inktomi will grant to Microsoft an irrevocable, non-exclusive,  royalty-free license to use the Product (and all required underlying Inktomi  Technology) solely in connection with Microsoft's operation of the Microsoft  Search Engine (which license shall include the right to create enhancements and  other derivative works based thereon for use in conjunction therewith) for such  period as Microsoft may require to transition its search engine services to  non-Inktomi technology (the Transition Period), and Inktomi will waive all  royalties otherwise payable pursuant to the Software Development Agreement  and/or the Information Services Agreement between the parties of even date  herewith; for the purposes of this clause (iv), the Transition Period will  commence at such time as Microsoft assumes control over said separate cluster  and begins itself operating the Microsoft Search Engine, and will continue  thereafter for eighteen months (18) or until the

                                      24

  termination of the Software Development Agreement and Information Services  Agreement (whichever is longer);

(v)   Inktomi will direct the Escrow Agent to release to Microsoft all Confidential Materials held by the Escrow Agent, subject to Microsoft's agreement to use such Confidential Materials only in connection with its licensed rights under clause (iv) above;

(vi)  Inktomi will agree to reimburse Microsoft for all reasonable costs incurred by Microsoft in transitioning its search engine to non-Inktomi technology (whether created by Microsoft or by a third party); and

(vii) Inktomi will cause the applicable proposed transferee of this Agreement to assume, jointly and severally with Inktomi, all of Inktomi's obligations  hereunder.

Microsoft will cooperate with Inktomi and use its reasonable best efforts so as





to enable Inktomi to satisfy the foregoing conditions precedent in a timely  manner. Upon satisfaction of the foregoing conditions precedent, this Software  Hosting Agreement shall be deemed terminated pursuant to Section 10.1. Upon  expiration of the Transition Period, all rights granted to Microsoft to use the  Product (other than Microsoft Technology, Joint Derivative Technology and the  Microsoft Derivative Technology) and/or any Inktomi Technology under the  transitional license referred to in clause (iv) or otherwise shall cease, and  Microsoft shall immediately return to Inktomi all Confidential Materials (and all copies thereof), provided however that, notwithstanding any provision of the Ancillary Agreements to the contrary, the undertaking by Inktomi to indemnify Microsoft and hold it harmless against Taxes as provided in clause (ii) above shall survive any such terminations.

                                      25 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?
Inktomi will maintain insurance (including but not limited

TAT-14 CABLE NETWORK

                     CONSTRUCTION AND MAINTENANCE AGREEMENT

                                [GRAPHIC OMITTED]

    Certified to be a true and complete copy of the original document in the

                           custody of Deutsche Telekom

- --------------------------------------------------------------------------------               Volkmar Rompke                         Carmen Bornefeld

       Deutsche Telekom AG, Friedrich-Ebert-Allee 140, 53113 Bonn, Germany

                               TABLE OF CONTENTS

1 DEFINITIONS                                                                  2

2 BASIC PRINCIPLES                                                             6

3 CONFIGURATION                                                                6

4 PROVISION OF SEGMENTS T AND S                                                8

5 OWNERSHIP OF SEGMENTS AND ADDITIONAL PROPERTY                                9

6 ESTABLISHMENT OF THE GENERAL COMMITTEE                                       9

7 ESTABLISHMENT OF MANAGING GROUP                                             11

8 PROCUREMENT GROUP; SUPPLY CONTRACT FOR SEGMENT S                            12

9 ACQUISITION AND USE OF CAPACITY                                             13

10 EQUIPAGE                                                                   15

11 INCREASE OR DECREASE OF DESIGN CAPACITY                                    15

12 OWNERSHIP PRICING                                                          16

13 DEFINITION OF CAPITAL COSTS OF SEGMENT S                                   16

14 ALLOCATION AND BILLING OF SEGMENT S CAPITAL COSTS                          17

15 TRANSIT FACILITIES TO EXTEND TAT-14 CAPACITY                               19    AND CONNECTION WITH INLAND SYSTEMS

16 OPERATION AND MAINTENANCE OF SEGMENTS T AND S                              20

17 OPERATION AND MAINTENANCE COSTS OF SEGMENTS     -ALLOCATION AND BILLING                                                   23

18 USE OF SEGMENTS Tl TO T7; COSTS, ALLOCATION AND    BILLING                                                                    23

19 KEEPING AND INSPECTION OF BOOKS                                            25

20 CURRENCY AND PLACE OF PAYMENT                                              26

21 DEFAULT OF PAYMENT                                                         27

22 LIABILITY                                                                  27

23 FORCE MAJEURE                                                              28

24 SETTLEMENT OF CLAIMS BY THE PARTIES                                        28

25 DURATION OF AGREEMENT AND REALIZATION OF ASSETS                            29

- -------------------------------------------------------------------------------- September 2, 1998                                                              i

26 RELATIONSHIP OF THE PARTIES                                                30





27 OBTAINING OF LICENSES                                                      30

28 PRIVILEGES FOR DOCUMENTS OR COMMUNICATIONS                                 30

29 CONFIDENTIALITY                                                            30

30 ASSIGNMENT OF RIGHTS AND OBLIGATIONS                                       31

31 WAIVER                                                                     32

32 COMMUNICATIONS                                                             32

33 PARAGRAPH HEADINGS, REFERENCES                                             32

34 SEVERABILITY                                                               33

35 EXECUTION OF AGREEMENT AND AMENDMENTS                                      33

36 INTERPRETATION OF THE AGREEMENT AND    SETTLEMENT OF DISPUTES                                                     33

37 SUCCESSORS BOUND                                                           34

38 ENTIRE AGREEMENT                                                           34

39 TESTIMONIUM                                                                35

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                                    SCHEDULES

SCHEDULE A        PARTIES TO THE AGREEMENT

SCHEDULE B        VOTING INTERESTS, OWNERSHIP INTERESTS IN SEGMENT S                   AND ALLOCATION OF CAPITAL, OPERATING AND                   MAINTENANCE COSTS IN SEGMENTS T AND S

SCHEDULE C        SUMMARY OF ALLOCATED CAPACITY

SCHEDULE C-1      SUMMARY OF ALLOCATED CAPACITY AS ASSIGNED AT                   THE TIME OF C&MA SIGNING

                                 ANNEXES

ANNEX 1        TERMS OF REFERENCE FOR MANAGING GROUP

ANNEX 2        TERMS OF REFERENCE FOR THE PROCUREMENT GROUP

ANNEX 3        TERMS OF REFERENCE FOR THE AR&R SUBCOMMITTEE

ANNEX 4        TERMS OF REFERENCE FOR THE F&A SUBCOMMITTEE

ANNEX 5        TERMS OF REFERENCE FOR THE CENTRAL BILLING PARTY

ANNEX 6        TERMS OF REFERENCE FOR THE NETWORK ADMINISTRATOR

ANNEX 7        SOURCE OF FINANCIAL CHARGE RATES

ANNEX 8        INITIAL OWNERSHIP PRICING MATRIX

ANNEX 9        CAPACITY STRUCTURE

ANNEX 1O       ORGANIZATION STRUCTURE

ANNEX 11       CONFIGURATION DIAGRAM

- -------------------------------------------------------------------------------- September 2, 1998                                                            iii





                              TAT-14 CABLE NETWORK

                     CONSTRUCTION AND MAINTENANCE AGREEMENT

This  Agreement,  made  and  entered  into  this  2nd  day  of  September  1998, hereinafter  called the Effective Date,  between and among the Parties signatory hereto  (hereinafter  collectively  called  Parties  and  individually  called Party),  which Parties are identified in Schedule A attached hereto and made a part hereof,

WITNESSETH:

WHEREAS, telecommunication services are being provided between and among Europe,      and North America,  by means of submarine  cable and satellite  facilities;      and

WHEREAS, the Parties plan to supplement  such  facilities  with an optical fibre      submarine cable system called the TAT-14 Cable Network  (hereinafter called      TAT-14) which will be used to provide telecommunication  services between      points in or reached via the United States of America,  the United Kingdom,      France, The Netherlands, Germany, Denmark and points beyond; and

WHEREAS, a Memorandum  of  Understanding  was signed on the 27th of May 1997 and      amended on the 18th of November 1997 (First Supplementary  Agreement) and      amended on the 27th of January,  1998 (First Amendatory  Agreement),  and      amended on the 27th of January,  1998 (Second  Supplementary  Agreement),      and amended on the 28th of January, 1998 (Third Supplementary Agreement),      and amended on the 12th of May,  1998 (Fourth  Supplementary  Agreement),      and amended on the 12th of May, 1998 (Fifth Supplementary Agreement), and      amended  on  18th  of  June,   1998  (Sixth   Supplementary   Agreement),      collectively  hereinafter referred to as the MOU establishing a framework      of  organization  to be effective  prior to the signature of this Agreement      and to be superseded by it; and

WHEREAS, the parties to the MOU invited other  International  Telecommunications      Entities to become Parties to this Agreement; and

WHEREAS, the  Parties now desire to define the terms and  conditions  upon which      TAT-14 will be engineered,  provided, constructed,  operated and maintained      in a cost effective manner for the duration of this Agreement.

NOW, THEREFORE,  the Parties,  in  consideration  of the mutual covenants herein      expressed, covenant and agree with each other as follows:

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page 1

1        DEFINITIONS

1.1      Definition of Terms

AFFILIATE

        A company in which not less than either ten percent (10%) or the highest         percentage  allowed by the local law,  whichever  is the lowest,  of its         voting  capital is owned  directly or indirectly by a Party or a company         owning  directly  or  indirectly  not less than  either ten (10%) or the         highest percentage allowed by the local law, whichever is the lowest, of         the voting capital of a Party.

AGENT

        An entity  acting on behalf of a Party or a  Purchaser  for  access to a         Terminal  Station which has an appropriate  license to provide  backhaul         and access in the respective Country.

BASIC SYSTEM MODULE (BSM)

        A Basic System Module of TAT-14 shall consist of a 155,520,000  bits per         second  digital line section with  interfaces in  accordance  with ITU-T         Recommendations  G.707  Network  Node  Interface  for  the  Synchronous         Digital  Hierarchy  Issue 1996  (STM-1).  A Basic  System  Module shall         contain 63 MIUs (Minimum Investment Units).





CABLE LANDING POINT

        Cable  Landing  Point shall be the beach joint at the  respective  cable         landing locations or mean low watermark of ordinary spring tides line if         there is no beach joint.

CABLE STATIONS

        The Cable  Stations are the  locations  where TAT-14 is  terminated  and         where access to other cable systems may be provided.

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CAPACITY

       Capacity shall be categorized as follows:

       (i)   Design Capacity

             The design  ring  capacity  of  Segment S of  TAT-14,  which is 640              Gbit/s.

       (ii)  Allocated Capacity

             Number  of  Ring-MlUs  distributed  to  Parties,   based  on  their              financial commitments at the time of signing of this Agreement,  as              shown in Schedule C.

       (iii) Purchased Capacity

             Capacity  purchased  after signing of this  Agreement by a Purchase              Contract.

       (iv)  Sold Capacity

             The sum of the Allocated Capacity and the Purchased Capacity.

       (v) Common Reserve Capacity (CRC)

             The difference between the Design Capacity and the Sold Capacity.

COUNTRY

      Country as used in this Agreement shall mean country,  territory or place,       as  appropriate.  For the purposes of Paragraph 15 of this  Agreement  the       Country associated with Telia shall mean Denmark.

INTERNATIONAL TELECOMMUNICATIONS ENTITY (ITE)

      Any  entity  authorized  or  permitted  under  the laws of its  respective       Country,  or another  Country  in which it  operates,  to acquire  and use       international  transmission  facilities for the provision of international       telecommunications  services and which is in  possession  of any necessary       operating license to enable it to do so.

MAINTENANCE AUTHORITIES

      The Maintenance Authorities in TAT-14 shall be the Terminal Parties.

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MINIMUM INVESTMENT UNIT (MIU)

      One Ring-MIU

MOU PARTIES

      The MOU Parties are AT&T,  BT, C&W, DTAG,  FT, KPN,  MCII,  PGE,  Sprint,       Swisscom, Telia.

PRIVATE AGREEMENT

      An agreement to make  capacity  available on  conditions  other than on an       ownership  basis from a Party to another  Party or to another  assignee of       capacity in possession of any and all requisite licenses for the provision       of international telecommunications.

PURCHASER

      An assignee of capacity,  including a Party,  obtaining TAT-14 capacity by       means of a Purchase  Contract and in  possession  of any and all requisite       licenses for the provision of international telecommunications.

PURCHASE CONTRACT

      A contract to make capacity  available  from the CRC on  conditions  other       than on an ownership basis.

READY FOR CUSTOMER SERVICE (RFCS) DATE

      The Ready for Customer Service Date (hereinafter called RFCS Date) shall       be  considered as the date at which the Parties agree to place TAT-14 into       operation  for  customer  service.  The RFCS Date is  planned  to be by 15       December 2000.

READY FOR PROVISIONAL ACCEPTANCE (RFPA) DATE

      The date on which Segment S of TAT-14 is accepted by the Procurement Group       on  behalf of the  Parties.  The Ready  for  Provisional  Acceptance  Date       (hereinafter called RFPA Date) is planned to be by 31 October 2000.

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RING

      An  electrical   and/or   optical  loop  that  provides  two   independent       bi-directional paths between two points for the same traffic.

RING-MIU

      A nominal 2 Mbps bearer,  and all the additional  overhead bits per second       recommended by ITU-T standards for multiplexing,  in a Ring  configuration       with the capability of bi-directional operation.

SUBSIDIARY

      A company  having at least the  majority  of its shares  owned  legally or       beneficially, directly or indirectly by its parent company.

SUPPLY CONTRACT

      The contract to be placed with the Supplier for the provision of Segment S       of TAT-14.





SYSTEM INTERFACE

      The  System  Interface  shall be the  nominal  155,520,000  bit/s  (STM-1)       digital  optical/electrical  input/output ports,  including STM-4, STM-16,       and/or  any  other  higher  level,  on  the  digital   distribution  frame       (including  the digital  distribution  frame  itself,  and any  additional       access  equipment  as shall be deemed  necessary  by the  Managing  Group,       including  any  crossconnect  equipment,  and  shall  be  regarded  as the       interface   location  where  TAT-14   connects  with  other   transmission       facilities or equipment.

TERMINAL PARTIES

      The Terminal Parties are AT&T, BT, Deutsche Telekom,  France Telecom, KPN,       Sprint, and Telia.

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page 5

1.2      Schedules and Annexes

         The Schedules and Annexes to this Agreement,  and any  supplementary or          amendatory  agreement thereto or any Schedules and Annexes  substituted          therefore,  shall form part of this Agreement,  and any Paragraph which          contains a  reference  to a Schedule  or Annex  shall be read as if the          Schedule  or Annex was set out at  length in the body of the  Paragraph          itself.  In the event that there is any conflict  between the terms and          conditions  of this  Agreement  and the  Schedules  and Annexes to this          Agreement, the terms and conditions of this Agreement shall prevail.

2        BASIC PRINCIPLES

2.1      Parties to this Agreement are ITEs and shall be entitled to participate          in the General Committee in accordance with Paragraph 6.

2.2      A Managing  Group shall be  established  for the purpose of supervising          TAT-14. The Managing Group will consist of one representative from each          of the MOU  Parties  and one  representative  from any  other  Party or          Parties who, individually or collectively, represent 10% or more of the          total voting interests specified in Schedule B. The Managing Group will          take all  decisions not reserved for the General  Committee,  which are          necessary to engineer,  provide,  install, bring into service,  operate          and maintain, administer, bill and market TAT-14.

2.3      The  acquisition  of capacity on an  ownership  basis is not  permitted          after the Effective  Date of this  Agreement,  at which time Schedule B          will be fixed.

3        CONFIGURATION

3.1      TAT-14  is  a  ring  system  comprising  two  transatlantic  links  and          terminals in the USA (two), the UK, France,  the  Netherlands,  Germany          and Denmark (as  referenced in Annex 11). The cable contains four fibre          pairs, each initially operating at 160 Gbit/s.

3.2      In  accordance  with  this  Agreement,  TAT-14  shall  be  regarded  as          consisting of the following Segments:

         Segment S: The submarine  portion of TAT-14 as defined in Subparagraphs          3.3 and 3.4 of this Agreement;

         Segment T1: The Sprint Cable Station at Manasquan in the United  States                      of America;

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page 6





         Segment T2: The AT&T Cable Station at Tuckerton in the United States of                      America,

         Segment T3: The BT Cable Station at Widemouth, the intermediate station                      at Pentewan  and the duct  between these  stations,  in the                      United Kingdom;

         Segment T4: The FT Cable Station at St. Valery-en-Caux in France;

         Segment T5: The KPN Cable Station at Katwijk in the Netherlands;

         Segment T6: The DTAG Cable Station at Norden in Germany;

         Segment T7: The Telia Cable Station at Blaabjerg in Denmark.

3.3      Segments T1 to T7 shall each consist of:

         (i)   an  appropriate  share of the land and buildings at the specified                locations for the cable landing,  the Cable Station and the cable                rights-of-way   and  ducts   between  a  Cable  Station  and  its                respective  Cable  Landing  Point,  and an  appropriate  share of                common  services and equipment  associated with and necessary for                Segment S;          (ii)  interface  equipment  in each of the  cable  stations  associated                solely and directly  with TAT-14 to operate and  interface at the                System Interface  operating point associated  solely with TAT-14;                and          (iii) an appropriate share of the test equipment (not solely associated                with TAT- 14).

3.4      Segment S shall consist of the following Subsegments:

         Subsegment S:  The submarine  cable  consisting  of  four  fibre  pairs                         between Manasquan and Tuckerton;

         Subsegment S2: The submarine  cable  consisting  of  four  fibre  pairs                         between Tuckerton and Widemouth;

         Subsegment S3: The submarine  cable  consisting  of  four  fibre  pairs                         between Widemouth and St Valery-en-Caux;

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page 7

         Subsegment S4: The submarine  cable  consisting  of  four  fibre  pairs                         between St Valery-en-Caux and Katwijk;

         Subsegment S5: The submarine  cable  consisting  of  four  fibre  pairs                         between Katwijk and Norden;

         Subsegment S6: The submarine  cable  consisting  of  four  fibre  pairs                         between Norden and Blaabjerg;

         Subsegment S7: The  submarine  cable  consisting  of  four  fibre pairs                         between Blaabjerg and Manasquan.

3.5      Segment S shall consist of the whole of the submarine cable between the          Cable Stations and shall include but shall not be limited to:

         (i)    all transmission  equipment,  System Interface equipment,  power                 feeding equipment and special test equipment directly associated                 with the  submersible  plant,  located in the  respective  Cable                 Station;,          (ii)   the power  equipment  provided wholly for use with the equipment                 listed in (i) above;          (iii)  the transmission cable equipped with appropriate amplifiers, and                 joint housings between the Cable Stations  including spare cable                 and spare amplifiers;          (iv)   the sea earth  cable  and  electrode  system  or the land  earth                 system,  or an appropriate  share thereof,  associated  with the                 terminal  power  feeding   equipment  in  the  respective  Cable





                Stations;          (v)    all  special  test  equipment,  system  supervisory  and control                 equipment solely associated with TAT-14;          (vi)   the  interconnection  equipment which shall be used to groom all                 payload  virtual  containers  transported by TAT-14 as required,                 however configured,  in order to meet the internal  connectivity                 requirements of TAT-14;

3.6      TAT-14 will operate as a SDH submarine  cable system in accordance with          ITU-T  Recommendations  G.707 Issue 1996  supporting  VC12, VC3 and VC4          paths and higher order paths as defined in the System Interface.

4        PROVISION OF SEGMENTS T AND S

4.1      Each of the Segments T1 to T7 shall be provided by the  Terminal  Party          owning that segment,  as shown in Subparagraph  5.1, in accordance with          the terms of Paragraph 18 of this Agreement. Segments T1 to T7 shall be          provided  in  sufficient  time  to  permit  TAT-14  to be  placed  into          operation by the RFPA Date.

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page 8

4.2      Segment S shall be provided  through a Supply  Contract to be placed by          the  Procurement  Group on behalf of the  Parties  in  accordance  with          Paragraph 8 of this Agreement.

5        OWNERSHIP OF SEGMENTS AND ADDITIONAL PROPERTY

5.1      Segments T1 to T7 of TAT-14 shall be owned as follows;

         (i)    Segment  T1 shall be owned by Sprint;  (ii)  Segment T2 shall be                 owned by AT&T;          (iii)  Segment T3 shall be owned by BT; (iv)  Segment T4 shall be owned                 by FT;  (v)  Segment T5 shall be owned by KPN;  (vi)  Segment T6                 shall be owned by DTAG;          (vii)  Segment T7 shall be owned by Telia.

5.2      Segment S shall be owned by the Parties in common and undivided  shares          in the  proportions set forth in Schedule B. Ownership of Segment S and          voting  interests,  as shown in Schedule B to this Agreement,  shall be          based upon the financial investment of each Party.

5.3      References to any Segment in this Agreement shall be deemed to include,          unless the context otherwise requires, additional property incorporated          therein by agreement of the Parties.  Each Segment shall be regarded as          including  its  related  spares  and  standby  units  and   components,          including,  but not limited to, submersible  amplifiers,  cable lengths          and terminal  equipment as necessary for the operational  capability of          TAT-14.

6        ESTABLISHMENT OF THE GENERAL COMMITTEE

6.1      For the purpose of monitoring the provision and continued  operation of          TAT-14,  of making key  decisions as specified in this  Agreement,  the          Parties  shall,  upon  the  signing  of this  Agreement,  form a TAT-14          General  Committee   (hereinafter   called  the  General   Committee)          consisting of one representative of each of the Parties.

 6.2      At each General Committee meeting a hosting Party for the next meeting           will be decided.  The hosting Party for each General Committee meeting           will provide the chairperson who will retain the coordination function           until the next meeting.

6.3      To aid the General  Committee in the performance of the duties assigned          to it,  pursuant  to this  Agreement,  and to  ensure  flexibility  and          efficiency  in  constructing,   operating,  maintaining  and  marketing          TAT-14, the General Committee immediately after signing this Agreement,          shall establish the Managing  Group,  as set forth in Subparagraph  2.2          and Paragraph 7. The General Committee shall also

- -------------------------------------------------------------------------------- September 2, 1998                                                        Pages 9





         be responsible for:

         (i)    the overall supervision of the project;          (ii)   approval of the initial budget for TAT-14;          (iii)  approval of the TAT-14 annual  report  submitted by the Managing                 Group;          (iv)   approval of the administrative budget of the Managing Group;          (iv)   reviewing  and  acting on any  other  reports  submitted  by the                 Managing Group; and          (v)    providing a forum for approval and  execution of any  amendments                 to the C&MA in accordance with Subparagraph 35.1.

6.4      During the project implementation,  the General Committee shall meet at          least once a year on the call of the chairperson.  After the RFCS Date,          the General Committee shall meet whenever requested by the chairperson.          Furthermore,  the General Committee shall meet whenever it is requested          by two or more Parties  collectively  representing  at least 5 % of the          total voting interests as specified in Schedule B.

6.5      In calling the General Committee  meetings,  the chairperson shall give          at least  forty-five (45) days' advance notice of each meeting together          with a copy of the draft  agenda.  In cases of  emergency,  such notice          period may be reduced if Parties  representing at least one-third (1/3)          of the total  voting  interests  as  specified  in  Schedule  B, are in          agreement.

6.6      All decisions made by the General  Committee  shall be subject,  in the          first place,  to  consultation  among the  Parties,  who shall make all          reasonable  efforts to reach  agreement  with  respect to matters to be          decided.  However,  in the  event  agreement  cannot  be  reached,  the          decision  shall be  carried  on the basis of a vote.  The vote shall be          carried by a majority (more than 50 %) of the total voting  interest as          specified in Schedule B, unless otherwise  stated in this Agreement.  A          member of the General Committee  representing more than one Party shall          separately cast the vote to which each Party he represents is entitled.

6.7      Decisions  required between scheduled  General  Committee  meetings may          also be reached by correspondence, provided :

         (i)    all Parties are  provided  with all the  necessary  and relevant                 information regarding the decision to be taken; and          (ii)   the  decision  taken is reduced to writing  and  approved by the                 required  majority of the total voting  interest as specified in                 Schedule B.

6.8      All decisions made by the General Committee shall be binding on all the          Parties.  No  decisions  of the General  Committee  shall  override any          provision of this Agreement.

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7        ESTABLISHMENT OF THE MANAGING GROUP

7.1      The  Managing  Group will consist of one  representative  from each MOU          Party  and one  representative  from any  other  Party or  Parties  who          individually or collectively represent 10 % or more of the total voting          interest as specified in Schedule B.

7.2      To aid the Managing Group in the  performance of the duties assigned to          it pursuant to this  Agreement,  the  following  bodies shall be formed          under the direction of the Managing Group:

         (i)    a Procurement Group;          (ii)   a Capacity  Assignment,  Routing  and  Restoration  Subcommittee                 (hereinafter called AR&R Subcommittee);          (iii)  a Financial and Administrative  Subcommittee (hereinafter called                 F&A Subcommittee);          (iv)   a Central Billing Party (hereinafter called CBP), and          (v)    a Network Administrator (hereinafter called NA).

         These  bodies  shall  be  responsible  for  their  respective  areas of          interest as listed in the  respective  Annexes 2 to 6 of this Agreement          and any other tasks  designated  by the  Managing  Group,  The Managing          Group  may also  appoint  other  groups  or  Subcommittees  to  address          specific  questions which may arise during the period this Agreement is          in force.

7.3      The  Managing  Group  shall act in the  interest  of the  TAT-14  Cable





         Network.  All decisions made by the Managing  Group, in accordance with          its Terms of  Reference  contained  in Annex 1, shall be binding on all          the Parties. No decisions of the Managing Group or its Subcommittees or          any other group  established  by the Managing  Group shall override any          provision of this Agreement.

7.4      The Subcommittees shall meet at least once annually after the Effective          Date of this Agreement and more frequently if necessary, until the RFCS          Date of TAT-14 and thereafter as may be  appropriate.  The  Chairperson          shall give reasonable  advance notice of each meeting,  together with a          copy of the draft agenda,  insofar as possible at least forty-five (45)          days prior to the date of the proposed meeting. The Chairperson of each          Subcommittee,  or a designated  representative,  may attend meetings of          the other Subcommittees in an advisory capacity as necessary.

7.5      After the RFCS Date of  TAT-14,  the  Managing  Group  shall  determine          whether any of its  Subcommittees  or any other group should  remain in          existence.  In the event that the Managing Group determines that any of          its  Subcommittees,  or any other group should not remain in existence,          the Managing Group has the right to determine,  in accordance  with its          Terms of Reference contained in Annex 1 of

- -------------------------------------------------------------------------------- September 2, 1998                                                       Page  11

         this Agreement,  the manner in which the  Subcommittee's,  or any other          group's responsibilities shall be reassigned.

8        PROCUREMENT GROUP; SUPPLY FOR SEGMENT S

8.1      The  Procurement  Group shall consist of AT&T,  BT, C&W, DTAG, FT, KPN,          MCII,  PGE,  Sprint and Telia.  This group shall act on a joint but not          several  basis on behalf  of the  Parties  to this  Agreement  and,  in          accordance  with its Terms of  Reference  contained  in Annex 2,  shall          negotiate the Supply Contract with the selected  supplier  (hereinafter          called the Supplier) to engineer,  provide and install or to cause to          be  engineered,  provided  and  installed  all of  Segment S of TAT-14,          except  for such  Segment S work as may be  performed  by the  Terminal          Parties or their subcontractors.

8.2      The Procurement  Group shall recommend a Supplier to the Managing Group          after  submission  and  evaluation  of  proposals   following  an  open          international  tender.  After Managing Group approval,  the Procurement          Group shall execute the Supply Contract.

8.3      The  Procurement  Group  shall  ensure  that the Supply  Contract  will          require the  Supplier  to  engineer,  provide and install  Segment S in          sufficient  time to permit  TAT-14 to be placed into  operation  by the          RFCS  Date.  Notwithstanding  that  certain  work of  Segment S will be          performed by the Terminal Parties or their  subcontractors,  the Supply          Contract  shall  require the Supplier to guarantee  that Segment S will          conform  to  the  technical  performance  requirements  for  TAT-14  as          specified in the Supply Contract.

8.4      The  Procurement  Group  shall  ensure that the Supply  Contract  shall          afford its designated  representatives  reasonable  rights of access to          examine,  test and inspect the submarine cable,  land cable,  submarine          cable and land cable  equipment,  material,  supplies and  installation          activities.  Such  representatives  shall  provide  reasonable  advance          notice  to  the  relevant  Terminal  Party  when  access  to any of the          Segments T1 to T7 is required.  The relevant  Terminal Party shall have          the  right  to  have  its  own  representatives   present  during  such          activities.

8.5      In the event that any portion of Segment S of TAT-14  fails to meet the          specifications  referenced  in the Supply  Contract for its  provision,          fails  to  provide  the  specified  capacity,  or  is  not  engineered,          provided, installed and ready in sufficient time to permit Segment S to          be  provisionally  accepted on or before the RFPA Date, the Procurement          Group shall take such action as may be necessary to exercise the rights          and remedies under the terms and conditions of the Supply Contract. The          Procurement  Group shall also take any other actions  directly  against          the  Supplier as may be  necessary  to  exercise  any or all rights and          remedies  available  under the  Supply  Contract.  Such  actions by the





         Procurement Group shall be subject to any direction deemed necessary by          the Managing Group.

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8.6      Neither  the  individual  members  of the  Procurement  Group,  nor the          Parties they represent, shall be liable to any other Party for any loss          or damage  sustained  by reason of a  Supplier's  failure to perform in          accordance with the terms and conditions of its Supply Contract,  or as          a result of Segment S of TAT-14 not meeting the RFPA Date as  specified          in the Supply  Contract,  or if TAT-14 does not  perform in  accordance          with the technical  specifications and other requirements of the Supply          Contract,  or TAT-14 is not  integrated or placed into  operation.  The          Parties  recognize  that the  Procurement  Group does not  guarantee or          warrant:

         (i)    the performance of the Supply Contract by the Supplier;          (ii)   the performance or reliability of Segment S; or          (iii)  that TAT-14 shall be integrated or placed into operation.

8.7      The Managing Group shall authorize the  Procurement  Group to implement          contract  variations  provided  that the  cumulative  total of all such          changes  to the  Supply  Contract  does not  increase  the value of the          Supply  Contract by more than $ 50M.  Any further  contract  variations          which  increase  the revised  budget  shall be submitted to the General          Committee for approval.

9        ACQUISITION AND USE OF CAPACITY

9.1      The Parties hereby acquire Allocated  Capacity in the form of Ring-MlUs          on an ownership basis as shown in Schedule C. After the signing of this          Agreement, capacity may only be acquired through a Purchase Contract or          through a Private Agreement, in accordance with this Paragraph 9.

9.2      An assignee of capacity under a Purchase  Contract or Private Agreement          must be  either  a Party  or an  entity  in  possession  of any and all          requisite licenses authorizing it to own, operate, acquire, sell and/or          use,  as  appropriate,  the  capacity  in TAT-14 for the  provision  of          international telecommunications.

9.3      The Parties and Purchasers  shall  designate the Cable Stations and the          amount of capacity to the NA that is planned to be  activated,  at some          period in advance of the date of the  activation,  Such period would be          determined by the Managing Group.

9.4      The assignment of each Party's Allocated Capacity to each Cable Station          at the time of the signing of this  Agreement is shown in Schedule C-1.          A Party or  Purchaser  may move any portion of its  capacity,  from one          Cable  Station,  to any other Cable  Station  without  any  increase in          investment.  A request for such a reassignment shall be notified to the          NA at some period in advance of the date of  reassignment,  such period          and  reassignment  shall be in accordance with procedures  developed by          the NA and approved by the Managing Group.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Paqe 13

9.5      The CRC of TAT-14 shall be owned by the Parties in common and undivided          shares.

9.6      The Managing Group shall  establish the terms and conditions  including          pricing  criteria  for  sales of  capacity  from the CRC.  The NA shall          develop  procedures  for sale of  capacity  from the CRC and a Purchase          Contract for approval by the Managing  Group.  Following such approval,          the NA shall be  authorized  to execute any such  Purchase  Contract on          behalf of all the Parties. No provisions of any Purchase Contract shall          override the provisions of this Agreement.  The Purchase Contract price          structure  may be reviewed  and amended if  necessary,  by the Managing          Group

9.7      Each Party shall be compensated  from the sale of capacity from the CRC





         under  conditions  set forth by the Managing  Group in accordance  with          Schedule C.

9.8      Any Party  shall be  entitled  to  transfer  any part of its  Allocated          Capacity  through  a  Private  Agreement.  No  provisions  of a Private          Agreement shall override the provisions of this Agreement.

9.9      Each Purchase Contract or Private Agreement shall

         (i)    contain at least the same  conditions on utilization of capacity                 as specified in Subparagraphs 9.16 and 9.17; and          (ii)   require that the entity  acquiring the capacity may only further                 transfer its capacity under the same conditions.

9.10     Notwithstanding  Subparagraph  2.3, at the  discretion  of the Managing          Group,  the  distribution of capacity from the CRC may be made on a pro          rata basis, in whole  Ring-MlUs,  in accordance with the percentages in          Schedule C.

9.11     No later than three years after the TAT-14 RFCS the remaining CRC shall          be  distributed  to the Parties on a pro rata basis in accordance  with          Schedule C. The Managing  Group will determine the process for the sale          of  capacity  of  those  Parties  that  do  not  need  their  pro  rata          distribution.

9.12     The  Managing  Group  may  authorize  the  utilization  of the  CRC for          restoration of other communications  systems based on appropriate terms          and conditions. Parties will be refunded in accordance with Schedule B.

9.13     The Managing  Group may study and  negotiate  the exchange or sale of a          portion of the CRC with other cable  systems on such basis as is deemed          mutually  beneficial to the Parties.  The terms and  conditions of such          exchange  or  sale  of  capacity  shall  be  approved  by  the  General          Committee.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 14

9.14     The  Managing  Group  may  authorize  occasional  use  of the  CRC,  if          available,    for   the    provision   of   temporary   or   occasional          telecommunications services, including but not limited to leases to any          Party or Purchaser and paid restoration of other systems,  on terms and          conditions  to be determined  by the Managing  Group.  The revenue from          such  occasional use shall be shared by the Parties in accordance  with          Schedule B

9.15     TAT-14 shall be capable of at least  supporting  payload paths of VC12,          VC3 and VC4.  The Parties  shall have the right to access such  payload          paths which shall  require 1, 21 and 63 contiguous  MIUs  respectively.          Each Party will also be permitted  to access its capacity  ownership on          defined SDH levels of its choice at a higher order in  accordance  with          the System Interface.

9.16     The  communications  capability of any capacity may be optimized by the          Parties or  Purchasers  to whom such capacity is assigned by the use of          equipment which will more efficiently use such capacity,  provided that          the use of such  equipment  does  not  cause  an  interruption  of,  or          interference  to the use of any other capacity in TAT-14 or prevent the          use  of  similar  equipment  by  other  Parties  or  Purchasers.   Such          equipment, if used, shall not constitute a part of TAT-14.

9.17     Data  streams  entering  into and being  transported  by TAT-14 must be          compliant with the ITU  Recommendation  G.707,  issue 1996, in order to          avoid any interruption,  degradation or any other adverse effect on the          performance  of TAT-14 or other  data  streams  in  TAT-14.  Each Party          agrees that all of its  capacity  will comply with this  obligation  in          respect of all  capacity  which is  assigned  to that  Party.  If after          notification by the Maintenance Authorities,  the Party responsible for          such  capacity  does not take  immediate  action to prevent any further          interruption,  degradation or other negative influence, the Maintenance          Authorities  may  take any  reasonable  action  to  protect  the  other          capacity  in  TAT-14  including  the   disconnection  of  the  capacity          responsible for such interruption, degradation or adverse effect.

10.      EQUIPAGE

         Unless otherwise  decided by the Managing Group,  TAT-14 shall be fully





         equipped for 640 Gb/s to the System Interface level at the RFPA Date.

11       INCREASE OR DECREASE OF DESIGN CAPACITY

11.1     The  Managing  Group  may  decide  to  increase  the  Design  Capacity.          Following  such  a  decision,  the  Managing  Group  shall  develop  an          implementation  plan  for  and  the  terms  and  conditions  of such an          increase.  The proposed  implementation  plan and terms and  conditions          shall be submitted to the General Committee for approval.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 15

11.2     If  subsequent  to the RFCS Date,  the  Design  Capacity  is  decreased          pursuant to the  agreement of the Managing  Group and such  decrease of          the Design Capacity affects neither the routing of circuits assigned in          TAT-14  nor the Sold  Capacity  of  TAT-14,  the  reduction  in  Design          Capacity will be subtracted  from the CRC as determined by the Managing          Group.

11.3     In the event that the capacity which TAT-14, or any Segment thereof, is          capable of providing is reduced below the capacity  required to support          the Sold  Capacity on its  existing or planned  routings as a result of          physical deterioration,  or for other reasons beyond the control of the          Parties,  the  Managing  Group shall  initiate a review of the capacity          routings in order to support the  rerouting of such Sold  Capacity.  If          necessary,  the Managing Group may further consider changes to capacity          assignments.

11.4     Financial  adjustments  shall be made among the Parties,  as necessary,          under  terms  and  conditions  recommended  by the  Managing  Group and          approved by the General Committee.

12       OWNERSHIP PRICING

12.1     The TAT-14 Initial Ownership Pricing Matrix is shown in Annex 8.

12.2     In the event that the final  cost of TAT-14 is lower  than the  initial          budget, each Party's investment shall be reduced on a pro-rata basis in          accordance  with Schedule B, with no change to its Allocated  Capacity.          If the final  cost of TAT-14 is higher  than the  initial  budget  each          Party's investment shall be increased on a pro-rata basis in accordance          with Schedule B. Schedule C shall not be affected.

13       DEFINITION OF CAPITAL COSTS OF SEGMENT S

13.1     Capital costs of Segment S, as used in this Agreement,  refers to costs          incurred in  engineering,  providing,  and  constructing  Segment S, or          causing it to be engineered, provided, and constructed, or in laying or          causing  to be  laid  cables,  amplifiers  and  joint  housings,  or in          installing or causing to be installed cable system equipment, and shall          include:

         (i)    the  costs  incurred  under  the  terms  of  the  TAT-14  MOU as                 identified in the TAT-14 budget;          (ii)   those costs payable to the Supplier  under the Supply  Contract,                 and

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 16

         (iii)  other costs incurred under the direction of the Managing  Group,                 or the  Procurement  Group,  and those  capital  costs  directly                 incurred by the Terminal  Parties,  the CBP, the NA or any Party                 authorized  by the  Managing  Group,  which  shall  be fair  and                 reasonable in amount and not included in the Supply Contract and                 which have been directly and reasonably incurred for the purpose                 of,  or  to  be   properly   chargeable,   in  respect  of  such                 engineering, provision, construction, installation and laying of                 Segment S of  TAT-14.  Such  costs  shall  include,  but are not                 limited  to,  the  costs  of  engineering,   design,  materials,





                manufacturing, procurement and inspection, installation, removal                 (with appropriate  reduction for salvage),  cable ship and other                 ship costs,  route surveys,  burying,  testing  associated  with                 laying or installation, customs duties, taxes (except income tax                 imposed upon the net income of a Party),  appropriate  financial                 charges  attributable to other Parties' shares of costs incurred                 by the  Terminal  Parties or any other Party  authorized  by the                 Managing  Group,  at the  rate at  which  such  Party  generally                 incurred   such   financial   charges,   supervision,    billing                 activities, overheads and insurance or a reasonable allowance in                 lieu of insurance,  if such Party elects to carry a risk itself,                 being a risk against  which  insurance is usual or recognized or                 would have been  reasonable.  Such  costs  shall  include  costs                 incurred by the Parties in the holding of the Data Gathering and                 the General Committee  meetings but excluding  attendance by the                 Parties' representatives at such meetings. Such costs shall also                 include costs incurred by the Parties in holding the meetings of                 the Managing Group, the Procurement Group and its Working Groups                 and   the   preparation   and   attendance   by   the   Parties'                 representatives at such meetings.

13.2     Capital  costs shall  exclude  costs  incurred  by the Parties  holding          meetings  of the AR&R  Subcommittee  and F&A  Subcommittee  established          pursuant to Subparagraph 7.2 of this Agreement or the attendance by the          Parties' representatives at such meetings.

13.3     Any  amounts  received  by,  or  credited  to,  a Party or the CBP as a          consequence  of  letters of  guarantee,  liquidated  damages,  or other          similar  amounts  resulting  from the failure of the  Supplier to fully          perform  any  provision  of the Supply  Contract,  shall  accrue to the          benefit of all the Parties in accordance with Schedule B.

13.4     The cost of repair or replacement of any part of TAT-14 in the event of          damage or loss arising during construction, laying, burying, installing          and the bringing into operation of TAT-14,  which is attributable under          the Supply  Contract to the  Parties,  shall be regarded as part of the          capital costs for the purpose of Subparagraph  13.1. Any of the Parties          may at its own  expense  insure  against  such  risks so far as its own          share of costs is concerned. Should the Managing Group agree to jointly          insure against such risks, the cost of such insurance will form part of          the capital costs referred to in Subparagraph 13.1.

14       ALLOCATION AND BILLING OF SEGMENTS CAPITAL COSTS

14.1     The capital  costs of Segment S of TAT-14,  as defined in Paragraph 13,          including any additional  work or property  incorporated  subsequent to          the RFPA Date

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 17

         by  agreement  of the  Parties,  shall be borne by the  Parties  in the          proportions set forth in Schedule B.

14.2     The CBP will receive  invoices  from the Supplier for the costs due and          included in the Supply  Contract.  The Parties  shall  promptly  render          invoices to the CBP for the cost of items directly  incurred by them in          accordance with Subparagraph  13.1. The CBP shall promptly render bills          to each of the Parties for such Party's pro rata share of costs due and          included in the invoices it has received in accordance with Schedule B.          Such bills shall contain a reasonable  amount of detail to substantiate          them.  On the basis of such bills,  each Party shall pay to the CBP the          amount  owed  within  forty-five  (45)  days from the date the bill was          rendered by the CBP in the currency shown on the respective bill.

14.3     For the purpose of this Agreement, financial charges shall be computed,          as appropriate,  at a rate equal to the lowest publicly announced prime          rate  or  minimum  commercial  lending  rate,  however  described,  for          ninety-day  loans on the 1st working day of each month of the period to          be  considered  in the Country and in the currency in which the bill is          rendered.  With respect to the Parties  rendering  invoices  under this          Agreement,  Annex 7 specifies those rates. If the Managing Group should          authorize a Party in a Country other than those Parties listed in Annex          7 to render  invoices,  the Managing Group shall specify the applicable          rates.

14.4     For the  purposes of this  Agreement,  paid shall mean that the funds          are available for immediate use by the recipient.

14.5     Bills not paid when due shall accrue extended  payment charges from the





         day  following  the date on which  payment was due in  accordance  with          Subparagraph  14.2 until the day on which it is paid.  For the purposes          of this Agreement, extended payment charges shall be computed at a rate          equal to 150 % of the  appropriate  financial  charges as  indicated in          Subparagraph 14.3 on the day following the date payment of the bill was          due. In the event that applicable law allows the imposition of extended          payment  interest  charges only at a rate less than that established in          accordance with this Subparagraph, extended payment charges shall be at          the  highest  rate  permitted  by such  applicable  law.  In this case,          appropriate  documents to  demonstrate  the  applicability  of such law          shall be provided by the concerned Party.

14.6     Extended payment charges recovered by the CBP, in excess of the amounts          paid or due, excluding interest paid by whichever Party or Parties have          covered  the deficit in the  intervening  period,  shall  accrue to the          benefit of all the Parties in accordance with Schedule B.

14.7     Procedures for rendering  credits for refunds of appropriate  financial          charges and bills for extended payment charges will be developed by the          CBP in conjunction with the F&A Subcommittee.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 18

14.8     As soon as practicable  after the RFPA Date, the amount of each Party's          share of the costs of Segment S shall be computed by the CBP which will          make appropriate  adjustments and render any necessary bills or arrange          for any necessary refunds by way of final settlement in order that each          Party  may  bear its  appropriate  share of the  costs as  provided  in          Subparagraph 14.1.

14.9     A bill shall be deemed to have been accepted by the Party to whom it is          rendered if that Party does not present a written  objection to the CBP          on or before  fifteen  (15) days prior to the date when payment is due.          If such  objection  is made,  the  Parties  concerned  shall make every          reasonable effort to settle promptly the dispute concerning the bill in          question.  If the  objection is sustained and the billed Party has paid          the  disputed  bill,  the agreed  upon  overpayment  shall be  refunded          promptly to the objecting  Party by the billing Party together with any          financial charges calculated thereon at a rate determined in accordance          with  Subparagraph  14.3 of this  Agreement from the date of payment of          the  bill  to the  date on  which  the  refund  is  transmitted  to the          objecting Party. If the objection is not sustained and the billed Party          has not paid the disputed bill,  said Party will pay such bill promptly          together with any extended payment charges calculated thereon at a rate          determined in accordance with  Subparagraph 14.5 of this Agreement from          the day  following  the date on which payment of the bill was due until          paid.  Nothing in this  Subparagraph  shall relieve a Party from paying          those parts of a bill that are not in dispute.  The  provisions of this          Subparagraph  shall be  without  prejudice  to the  rights of any Party          pursuant to Paragraph 21 of this Agreement.

15       TRANSIT FACILITIES TO EXTEND TAT-14 CAPACITY AND CONNECTION WITH INLAND          SYSTEMS

15.1     The Terminal  Parties shall use all  reasonable  efforts to furnish and          maintain, or cause to be furnished and maintained, in working order for          the other Parties and for the Purchasers in TAT-14, for the duration of          this Agreement,  the necessary facilities in their respective Countries          as may be reasonably required for extending capacity in TAT-14 assigned          to  such   Parties  or   Purchasers   for  the   purpose  of   handling          communications  transiting  the  Country  involved.  No Party  shall be          required under this Agreement to furnish such transit facilities in its          Country to other Parties or Purchasers of its own Country.

15.2     Such facilities  referred to in Subparagraph 15.1 shall be suitable for          extending  capacity in TAT-14 and shall be furnished and  maintained on          terms  and  conditions  which  shall be no less  favorable  than  those          granted to other ITEs for  transmission  facilities of similar type and          quantity  transiting the Country.  Such terms and conditions  shall not          override  any  applicable  governmental  laws  and  regulations  in the          Country in which the facilities are located.

15.3     Each  Terminal  Party  shall  provide,  within the Country of its Cable          Station,  connection to TAT-14 at the SDH Interface  Equipment  levels,          VC12,  VC3 or VC4  levels,  to  Parties  and  Purchasers  on terms  and          conditions  to be agreed by the  Terminal  Party and the other Party or          Purchaser under a separate agreement.

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September 2, 1998                                                        Page 19

15.4     The Terminal  Parties shall, at its own expense,  on or before the RFPA          Date do or cause  to be  done,  all  such  acts  and  things  as may be          necessary  within  its  operating  territory  to provide  and  maintain          throughout the period of this Agreement suitable connection of capacity          in, or  connected  with  capacity  in TAT-14  with  appropriate  inland          communications facilities in its operating Country.

15.5     Upon  request,  each  Terminal  Party  in its  Country  shall  make all          reasonable efforts to provide to other Parties or Purchasers, or Agents          of the Parties or Purchasers from such Terminal Party's Country, access          to  TAT-14  in the  vicinity  of its  Cable  Station  (not  necessarily          co-located) at the level of a Basic System Module or multiples thereof,          given  that the  requesting  Party  or  Purchaser  has the  appropriate          capacity  assigned to it. Such facilities shall be provided in a timely          manner  and for the  duration  of this  Agreement  under  the terms and          conditions  to  be  negotiated   and  agreed  between  the  Parties  or          Purchasers concerned under a separate agreement.

15.6     As U.S. Terminal  Parties,  AT&T and SPRINT shall provide to other U.S.          Parties,  upon request,  suitable space and connection  with TAT-14 for          operating and technical control purposes relating to capacity assigned,          or to be assigned,  to them in TAT-14.  AT&T and SPRINT  shall  provide          such space in a building  separate,  but adjacent to its cable  station          and located on the land which forms a part of Segments T1 and T2. These          U.S.  Parties  shall have the right to provide  their own personnel and          equipment in such space.  Such U.S.  Parties shall  reimburse  AT&T and          SPRINT  for the  reasonable  costs  incurred  by  AT&T  and  SPRINT  in          providing  such space and  connection  pursuant to this  Paragraph  15,          including but not limited to, the costs of any additional building that          may be reasonably required

15.7     The Managing Group is responsible  for  determining and setting service          level objectives for access and activation  intervals  jointly with the          Terminal Parties.

16       OPERATION AND MAINTENANCE OF SEGMENTS T AND S

16.1     The  Terminal  Parties,  on behalf of the Parties and  Purchasers,  are          responsible for operation and maintenance as follows:

         (i)    Sprint shall be responsible for Segment T1;          (ii)   AT&T shall be responsible for Segment T2;          (iii)  BT shall be responsible for Segment T3;          (iv)   FT shall be responsible for Segment T4;          (v)    KPN shall be responsible for Segment T5;          (vi)   DTAG shall be responsible for Segment T6;          (vii)  Telia shall be responsible for Segment T7;

16.2     Each  Terminal  Party shall also be  responsible  for the operation and          maintenance  of that portion of Segment S beginning  at its  respective          Cable Landing Point and

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 20

         extending to its respective Segment T, on behalf of the Parties and the          Purchasers.

16.3     All Terminal Parties as the Maintenance  Authorities,  acting on behalf          of the Parties and  Purchasers,  shall be jointly  responsible  for the          operation  and  maintenance  of  Segment  S from the  respective  Cable          Landing  Points  and  extending  seaward,   and  shall  undertake  such          activities necessary for the continued operation of TAT-14.

16.4     Sixty (60) days before the RFPA Date the Maintenance  Authorities shall          submit for review by the Procurement Group and approval by the Managing          Group appropriate  practices and procedures for the continued operation          and  maintenance of Segment S. The Maintenance  Authorities  shall each          provide  information to the  Procurement  Group regarding the practices          and  procedures  for the continued  operation and  maintenance of their          respective  Segments.  The  Maintenance  Authorities  shall  also  each          develop  and  furnish  such  budgetary  estimates  of the  cost of such          operation  and   maintenance  of  TAT-14  as  the  Managing  Group  may          reasonably   request  and   provide   this   information   to  the  F&A          Subcommittee.  Following  the RFPA Date,  the  Maintenance  Authorities          shall each  provide  the  Managing  Group  with such  reports as it may





         reasonably require on the operation and maintenance of TAT-14 including          any proposals for planned  repair or  improvement  work,  together with          appropriately revised budgetary estimates relating to the operation and          maintenance  of  TAT-14  and  the  inclusion  of  TAT-14  in any  cable          maintenance agreements.  The Procurement Group may review and amend the          practices and procedures  for the operation and  maintenance of Segment          S, subject to the approval of the Managing  Group.  The Managing  Group          may revise the  allocation  of  responsibility  for the  operation  and          maintenance of Segment S.

16.5     The   Maintenance   Authorities,   individually   or   collectively  as          appropriate,  shall each use all  reasonable  efforts to  maintain,  or          cause to be  maintained,  economically  the  Segments for which each is          responsible,  in efficient  working order.  Each Maintenance  Authority          shall  discharge  its   responsibility  in  a  manner  consistent  with          applicable international submarine cable maintenance practices and with          an objective of achieving effective and timely repairs when necessary.

16.6     The  Maintenance  Authorities  shall  have  the  right  to  temporarily          de-activate  Segment S, or any part thereof,  in order to perform their          duties  as  Maintenance  Authorities.   Prior  to  such  de-activation,          reasonable notice shall be given to and coordination shall be made with          the other  Parties.  To the extent  possible,  sixty (60) days prior to          initiating  action,  the  Maintenance  Authority(ies)  shall advise the          other Parties in writing of the timing, scope, and costs of significant          planned  maintenance  operations,  of  significant  changes to existing          operation and maintenance methods, and of contractual  arrangements for          cable ships that will or may have a significant  impact on operation or          maintenance costs. Should one or more Parties representing at least 5 %          of the total  voting  interests  specified in Schedule B wish to review          such an  operation  or change  prior to its  occurrence,  such Party or          Parties  shall  notify the  Maintenance  Authorities  involved  and the          Managing  Group  chairperson in writing within thirty (30) days of such          advice.  Upon such  notification,  the  Managing  Group shall  initiate          action to convene an ad hoc meeting for such review.

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16.7     Each  Maintenance  Authority  shall  have  prompt  access to all system          maintenance  information,  necessary to the  performance of its duties,          appropriate to those parts of TAT-14 not covered by its authority.

16.8     No Party shall be liable to any other Party or  Purchaser  for any loss          or damage sustained by reason of any delay in provision,  failure in or          breakdown of the facilities  constituting TAT-14 or any interruption of          service,  whatsoever  shall be the cause of such failure,  breakdown or          interruption, and however long it shall last.

16.9     In the event of a failure or  breakdown of any of such  facilities,  if          the responsible Maintenance Authority fails to restore those facilities          to efficient working order and operation within a reasonable time after          having  been  called  upon  to do so by any  Party  or  Purchaser,  the          Managing  Group may, to the extent that it is practical to do so, place          or cause to be placed,  such facilities in efficient  working order and          operation and charge the Parties their proportionate shares of the cost          reasonably incurred in doing it.

16.10    Each Party, at its own expense,  and upon reasonable  advance notice to          the relevant Maintenance  Authorities,  shall have the right to inspect          from time to time the operation and  maintenance  of any part of TAT-14          and to obtain copies of the maintenance records. For this purpose, each          Maintenance  Authority  shall  retain  significant  records,  including          recorder charts,  for a period of not less than five (5) years from the          date of the record.  If these  records are destroyed at the end of this          period,  a summary of important items shall be retained for the life of          TAT-14.

16.11    Each Maintenance  Authority shall be authorized to pursue claims in its          own name, on behalf of the Parties,  in the event of any damage or loss          to TAT-14 and may file  appropriate  lawsuits or other  proceedings  on          behalf of the Parties.  Subject to obtaining the prior  concurrence  of          the Managing  Group,  a Maintenance  Authority may settle or compromise          any claims and execute releases and settlement  agreements on behalf of          the Parties as  necessary  to effect a settlement  or  compromise.  Any          money  ordered by the  tribunal or under a  settlement  approved by the          Managing  Group shall be shared  among all Parties in  accordance  with          Schedule B.

16.12    The Maintenance  Authorities shall be entitled to enter into agreements          in respect of the crossing of Segment S with undersea plant (including,          but not  limited  to,  pipelines)  with the owners of such  plant.  The          Maintenance  Authorities  may sign such agreements on behalf of all the          Parties  after  agreement by the Managing  Group and shall  provide the





         Parties with copies of such agreements on request.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 22

17       OPERATION AND MAINTENANCE COSTS OF SEGMENT S - ALLOCATION AND BILLING

17.1     The  operation and  maintenance  costs for Segment S shall be shared by          the Parties in the  relevant  proportions  specified in Schedule B. The          Managing  Group shall be  responsible  for  determining  the method and          procedure  for  the  charging  of  O&M  costs  to  Purchasers  and  the          distribution  of any credit to the Parties in accordance  with Schedule          B.

17.2     The operation and maintenance  costs to which  Subparagraph 17.1 refers          are the costs  reasonably  incurred in operating  and  maintaining  the          facilities  involved,  including,  but  not  limited  to,  the  cost of          attendance,  testing,  adjustments,  repairs (including repairs at sea)          and replacements,  cable ships (including standby costs), re-burial and          the replacement of plant, cable depots,  maintenance and repair devices          that are or may  hereafter  become  available,  customs  duties,  taxes          (except  income tax imposed upon the income of a Party) paid in respect          of such facilities,  billing activities,  appropriate financial charges          attributable   to  other  Parties'   shares  of  costs  incurred  by  a          Maintenance Authority at the rate at which the appropriate  Maintenance          Authority  generally  incurred  such  financial  charges,  supervision,          overheads  and costs and  expenses  reasonably  incurred  on account of          claims made by or against other  persons in respect of such  facilities          or any part thereof and damages or compensation  payable by the Parties          concerned  on account of such claims and costs for the  Managing  Group          and the NA costs, General Committee meeting costs, expenses and damages          or compensation  payable to the Parties on account of such claims shall          be shared by them in the same  proportions  as they share the operation          and  maintenance  costs of the  relevant  Segment S under  Subparagraph          17.1.

17.3     The Managing  Group may  authorize  the  provision of special tools and          test  equipment for use on board cable ships which are required for the          maintenance  and repair of TAT-14.  The related costs may include,  but          not be limited to, the costs, or an appropriate share thereof,  for the          provision, storage and maintenance of this equipment.

17.4     The Maintenance Authorities  individually,  the Terminal Parties or the          CBP, as  appropriate,  shall bill the Parties in  accordance  with this          Paragraph 17. Bills shall not be rendered more  frequently  than once a          quarter and shall be paid by the end of the month  following  the month          in which the bills were rendered.  The billing procedures  specified in          Subparagraphs  14.3,  14.4,  14.5,  and 14.9 shall be applicable to all          bills rendered pursuant to this Paragraph 17.

18       USE OF SEGMENTS T1 TO T7; COSTS, ALLOCATION AND BILLING

18.1     The owners of Segments T1 to T7, respectively,  as defined in Paragraph          5, hereby grant the Parties,  commencing on the RFPA Date or the date a          Party  places any of its  capacity  into  operation,  whichever  occurs          first, and continuing for the term of this Agreement,  the right to use          such  Segments  for the  purpose of using its  Allocated  Capacity  and          carrying on the related  activities,  in accordance with this Agreement          as provided in this Paragraph 18 at no additional cost unless

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 23

         otherwise  identified in this Paragraph 18 (hereinafter  referred to as          Cable Station Right of Use).





18.2     For the use of Segments T1 to T7, the  respective  Terminal Party shall          identify  the charge to cover  capital  costs and cost of  maintenance,          supervision and operation of that Segment.

18.3     The  Procurement  Group is responsible  for submitting all the detailed          costs of the  Cable  Stations  to the  Managing  Group for  review  and          approval.

18.4     The capital  costs  associated  with Segments T1 to T7 will be borne by          the Parties in accordance with Schedule B.

18.5     The operation and maintenance  costs  associated with Segments T1 to T7          will be  borne  by the  Parties  in  accordance  with  Schedule  B. The          Managing  Group shall be  responsible  for  determining  the method and          procedure  for  the  charging  of  O&M  costs  to  Purchasers  and  the          distribution  of any credit to the Parties in accordance  with Schedule          B.

18.6     In  determining  the  charge of the  Cable  Station  Right of Use,  the          Terminal  Parties  have taken into  account the  estimated  cost of the          provision and  construction of each of the Cable  Stations,  or causing          them to be provided and  constructed,  and  installing or causing to be          installed  Cable Station  equipment,  in accordance with the accounting          practices of each Terminal  Party.  This includes all such  expenditure          reasonably  incurred  and  includes but is not limited to, the purchase          costs of land,  building  costs,  access  road,  cable  rights  of way,          amounts  incurred  for  development,  engineering,  design,  materials,          manufacturing, procurement and inspection, installation, removing (with          appropriate   reduction   for   salvage),   testing   associated   with          installation, customs duties, taxes (except income tax imposed upon the          net income of a Party),  appropriate  financial  charges,  supervision,          overheads and insurance or a reasonable  allowance in lieu thereof,  or          losses  against  which  insurance  was not  provided,  or for  which an          allowance in lieu thereof was not provided. Such charges shall be borne          by the Parties in the proportions specified in Schedule B.

18.7     In determining the operation and maintenance  cost of the Cable Station          Right of Use, the Terminal  Parties shall take into account an estimate          of  costs   reasonably   incurred  in  operating  and  maintaining  the          facilities  involved,  including,  but  not  limited  to,  the  cost of          attendance,  testing,  adjustments,  repairs and replacements,  customs          duties,  taxes  (except  income tax as imposed upon the net income of a          Party)  paid  in  respect  of  such  facilities,   billing  activities,          administrative  costs,  appropriate  financial  charges,  and costs and          expenses  reasonably  incurred  on account of claims made by or against          other persons in respect of such  facilities  or any part thereof,  and          damages or  compensation  payable by the  Terminal  Party on account of          such claims, costs, expenses, damages, or compensation payable to or by          the Terminal Party on account of claims made against other persons.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 24

18.8     Where  the use of a Cable  Station  or of  certain  equipment  situated          therein, such as power supply or testing and maintenance equipment,  is          shared by TAT-14 and other  communications  systems terminating at that          Cable Station, the Cable Station Right of Use capital and operating and          maintenance  charges  shall  reflect the  pro-rata  share of the common          costs attributable to TAT-14.

18.9     If any of the Cable  Stations  are not  available  for the  landing and          termination of TAT-14 for any reason,  the relevant  Terminal Party, in          agreement with the other Parties,  shall take all necessary measures to          ensure that another suitable Cable Station will be available for TAT-14          on fair and equitable terms for the duration of this Agreement.

18.10    Nothing  contained  in this  Agreement  shall be  deemed to vest in any          Party, other than the owner of the relevant Segment, any salvage rights          in Segments T1 to T7 or in the respective Cable Station or in any Cable          Station substituted for any of them.

18.11    Payments due under this  Paragraph 18 shall be made in accordance  with          the following principles:

         (i)    On the RFPA Date, or as soon after as  practicable  but no later                 than one (1) year after RFPA,  the Terminal  Parties will submit                 invoices to the CBP for their capital cost of the Cable Stations                 Right of Use. In the event a Terminal  Party  incurs  additional                 capital  costs  related  to TAT-14  after the RFPA  Date,  these                 invoices  shall  also  be  submitted  to  the  CBP  as  soon  as                 practicable;





         (ii)   by the 1st of April of each  year,  the  Terminal  Parties  will                 submit  invoices to the CBP for their O&M charges  incurred  for                 the Cable Stations Right of Use for the previous calendar year;          (iii)  the  Parties  shall be  billed  individually  by the CBP for the                 Cable  Station  Right of Use  operation  and  maintenance  costs                 shared in the proportions specified in Schedule 13;          (iv)   the billed  Party shall pay such bills to the CBP, by the end of                 the month  following the month in which the bills were rendered.                 A bill shall be payable in the currency in which it is rendered;

         (v)    the Terminal Parties will be reimbursed by the CBP;

         (vi)   the billing  procedures  specified in Subparagraphs  14.3, 14.4,                 14.5,  and 14.9 of this  Agreement  shall be  applicable  to all                 bills rendered pursuant to this Paragraph 18.

18.12    Each  Terminal  Party agrees to grant a Cable  Station  Right of Use to          TAT-14 Purchasers  pursuant to the terms and conditions of the Purchase          Contract.

19       KEEPING AND INSPECTION OF BOOKS

19.1     For the items specified in the Supply Contract,  the Procurement  Group          shall ensure that the Supply Contract requires the Supplier to keep and          maintain such books, records, vouchers and accounts of all the incurred          costs with respect to

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 25

         the engineering,  provision and installation of facilities in Segment S          of TAT-14 for a period of five (5) years from the RFPA Date.

19.2     The Procurement  Group shall ensure that the Supply  Contract  requires          the Supplier to obtain from its  contractors  and  subcontractors  such          supporting  records  as are  specified  in  Subparagraph  19.1  of this          Agreement  and to maintain  such records for a period of five (5) years          from the RFPA Date.

19.3     The  Procurement  Group  shall  ensure that the Supply  Contract  shall          afford the  representatives  designated by the Managing Group the right          to review the books,  records,  vouchers  and  accounts  required to be          kept,  maintained and obtained pursuant to Subparagraphs  19.1 and 19.2          of this Agreement.

19.4     Each Terminal Party and any other Party having properly  incurred costs          for  implementation of TAT-14 as authorized by the Managing Group shall          each keep and maintain  such books,  records,  vouchers and accounts of          all Segment S costs as defined in  Paragraph 14 of this  Agreement  and          Segments T1 to T7 costs,  which they incur and are not  included in the          Supply  Contract  for a period of five (5) years  from the RFPA Date or          the date the work is completed, whichever is later.

19.5     The CBP shall keep and  maintain  such  books,  records,  vouchers  and          accounts with respect to its billing of costs  incurred by the Terminal          Parties and any other Party having incurred costs for implementation of          TAT-14 as authorized by the Managing Group and costs billable under the          Supply  Contract  for a period of five (5) years  from the RFPA Date or          the date on which the work is completed, whichever is later.

19.6     With  respect  to  operation  and  maintenance  costs of  Segment S and          Segments T1 to TT such books,  records,  vouchers and accounts of costs          as are  relevant  shall  be  kept  and  maintained  by the  Maintenance          Authorities  for a period of five (5) years  from the date on which the          corresponding bills were rendered to the Parties.

19.7     Any Party keeping and maintaining books, records, vouchers and accounts          of  costs  pursuant  to  Subparagraphs  19.4,  19.5  and  19.6  of this          Agreement  shall  afford the  Parties  the right to review at their own          expense  said  books,  records,  vouchers  and  accounts  of  costs  in          accordance   with  the  audit   procedures   established   by  the  F&A          Subcommittee.

20       CURRENCY AND PLACE OF PAYMENT

         Amounts due under this  Agreement  shall be payable in US dollars.  The          Managing Group may vary these procedures at its discretion. Bills shall          be payable to the designated office or account of the payee.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 26





21       DEFAULT OF PAYMENT

21.1     If any Party fails to make any payment  required by this  Agreement  on          the date when it is due and such default  continues  for a period of at          least two (2) months  after the date when  payment  is due,  the CBP or          billing Party shall notify the billed Party in writing of its intent to          notify  the  Managing  Group of the status of the matter and to request          the  reclamation of capacity,  as provided for in this Paragraph 21, if          full  payment  is  not   received   within  four  (4)  months  of  such          notification  to the billed  Party.  If full  payment  is not  received          within such  specific  period,  the billing Party or CBP may notify the          Managing  Group  of the  status  of the  matter  and  request  that the          Managing  Group  reclaim  the  capacity  in  TAT-14   assigned  to  the          defaulting Party.

21.2     The  Managing  Group shall have the option of  reclaiming  the capacity          assigned  to a Party that is in default  with any  payment  required by          this  Agreement  or is in default  with any other  material  obligation          under this  Agreement,  if such default has existed for a period of six          (6)  months.   The  Managing  Group  shall  consider  any   extenuating          circumstances  not within the specific  control of the defaulting Party          and the  interests of any Party or Parties  that have jointly  assigned          capacity with the  defaulting  Party in  determining  whether or not to          reclaim  the  capacity  assigned  to such  defaulting  Party.  Prior to          reclaiming  the capacity  the  Managing  Group will notify the Party in          writing that it is in default and of the intent to reclaim the capacity          after one (1) month.  The Managing Group shall  determine  arrangements          for disposition of any reclaimed capacity.  The remaining Parties shall          not be  obliged  to make any  payment  to a  defaulting  Party  for the          reclaimed capacity.  Except for the rights and obligations as specified          in Paragraphs 25 and 29 the rights and obligations under this Agreement          of a defaulting  Party shall  terminate at the time the Managing  Group          reclaims all of the capacity previously assigned to a defaulting Party.          This Agreement shall be appropriately amended to reflect the default of          a Party and the  reallocation  of  interests  pursuant to  arrangements          determined by the Managing Group.

22       LIABILITY

22.1     No Party  excludes or  restricts  its  liability  for death or personal          injury  resulting  from its own  negligence.  Subject to the  preceding          sentence, no Party shall be liable to any other Party in contract, tort          or otherwise including any liability for negligence for any indirect or          consequential loss or damage including, without limitation,  corruption          or loss of data,  loss of profit,  loss of  anticipated  savings all in          connection with this Agreement,  caused by its own acts or those of any          of its auxiliaries, such as employees, servants or agents. Furthermore,          no Party  shall be  liable  to any  other  Party in  contract,  tort or          otherwise for any direct damage unless and to the extent it is based on          intent or gross negligence. In no event shall any employee,  servant or          agent of a Party be  liable to  another  Party  for any  negligence  or          intent in connection with this Agreement.

22.2     No Party  shall be liable to any other  Party for any matter  resulting          from planned interruptions of TAT-14 including but not limited to final          acceptance tests.

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 27

23       FORCE MAJEURE

         If any Party cannot fulfill its obligations in this Agreement due to an          event  beyond its  reasonable  control,  including,  but not limited to          flood,  exceptionally  severe  weather,  hurricane,   explosion,  civil          disorder,  war or military  operations,  national  or local  emergency,          action or inaction of government or other competent authority, it shall          not be liable to the other  Parties  for such  delay in  performing  or          failure to perform and shall give  notice to the other  Parties as soon          as reasonably practicable after the event has occurred.

24       SETTLEMENT OF CLAIMS BY THE PARTIES

24.1     Each Party shall indemnify and hold harmless the other Parties and each          of their  employees,  servants  and  agents to the  extent  hereinafter          agreed,  from  and  against  all  claims,   demands,   actions,  suits,          proceedings,  writs,  judgment,  orders and  decrees  brought,  made or          rendered  against them or any of them by third parties and all damages,          losses  and  expenses  suffered  or  incurred  by  them  or any of them          howsoever  arising  out of or  related  to any  respect  of  providing,          constructing and maintaining TAT-14.





24.2     If any Party is obliged by a final judgment of a competent  tribunal or          under a settlement  approved by the Managing  Group,  to discharge  any          claim,   including  all  reasonable   costs  and  expenses   associated          therewith,  resulting from the  implementation  of this Agreement,  the          Party which has  discharged the claim shall be entitled to receive from          the  other  Parties  reimbursement  in the  proportions  as set  out in          Schedule B.

24.3     If any claim is brought  against  one or more  Parties  it shall,  as a          condition of reimbursement under Subparagraph 24.2, give written notice          thereof  to the  Managing  Group as soon as  practicable  and shall not          admit liability nor settle,  adjust or compromise the claim without the          approval of the Managing Group.

24.4     Before any Party  brings a claim  against any third party in respect of          loss or damage to any part of TAT-14,  it shall first  consult with the          Managing Group and shall not settle,  adjust or compromise such a claim          without its  consent.  Any money  received by the  claimant  Party as a          result  of an  award by a  competent  tribunal  or  under a  settlement          approved by the Managing Group shall be shared among the Parties in the          proportions of their  respective  ownership  shares in accordance  with          Schedule B.

24.5     In the  case  where a claim  is  brought  against  one of the  Terminal          Parties,  in its  capacity  as a  Maintenance  Authority  for TAT-14 in          respect of a  sacrificed  anchor  and/or  loss of, or damage to fishing          gear,  then such  Terminal  Party may settle such a claim for an amount          not greater than $ 25,000 on each  occasion or such an amount as agreed          by the Managing Group from time to time, and obtain reimbursement under          Subparagraph 24.2.

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25       DURATION OF AGREEMENT AND REALIZATION OF ASSETS

25.1     This Agreement  shall become  effective on the Effective Date and shall          continue in operation for at least a period of  twenty-five  (25) years          (hereinafter  called Initial Period) after the RFCS Date and shall be          terminable  thereafter by agreement of the Parties.  However, any Party          may terminate  its  participation  in this  Agreement at the end of the          Initial Period or at any time  thereafter by giving at least one year's          prior notice,  in writing,  to the other  remaining  Parties.  Upon the          effective  date  of  termination  of  participation  of  a  Party,  the          Schedules  of this  Agreement  shall  be  appropriately  modified.  The          remaining Parties shall assume the capital,  operation, and maintenance          interests of the Party  terminating its  participation in proportion to          their interests assigned  immediately  preceding such effective date of          termination,  except for the continuing  rights and  obligations of the          terminating Party as specified in Subparagraphs  25.4, 25.5 and of this          Agreement.  No credit  for  capital  costs will be made to a Party that          terminates its participation in accordance with this Subparagraph 25.1.          Termination of this Agreement or  termination of the  participation  of          any Party herein shall not terminate  Subparagraphs  25.4, 25.5 of this          Agreement or  prejudice  the  operation or effect  thereof or affect or          diminish any other right or obligation  of any Party hereto  accrued or          incurred prior to such termination.

25.2     This  Agreement may be terminated at any time during the Initial Period          by unanimous written agreement of the Parties.  If unanimous  agreement          cannot be reached  between all the Parties for the retirement of TAT-14          during its  intended  lifetime,  this  matter  will be  referred to the          General  Committee for resolution in accordance with  Subparagraph  6.6          but  in  this  case  requiring  a 85 %  majority  of the  total  voting          interests as specified in Schedule B.

25.3     If a Terminal  Party  terminates  its  participation  in this Agreement          after  the  Initial  Period,  pursuant  to  Subparagraph  25.1  of this          Agreement,  the Managing Group and said Terminal Party will negotiate a          reasonable  agreement  in order to ensure the  continuous  operation of          that Cable Station after the Initial Period.

25.4     The interests of a Party in Segment S which come to an end by reason of          the  termination  of its  participation  in this  Agreement,  or of the          termination of this Agreement,  shall be deemed to continue for as long          as is necessary for effectuating the purposes of Subparagraph 25.5.

25.5     Notwithstanding  Subparagraph  25.1 upon  termination of this Agreement          pursuant to this  Paragraph 25 the Parties  shall not be relieved  from          any liabilities, costs, damages or obligations which may arise pursuant          to  Paragraph  17 and/or in  connection  with  costs or claims  made by          persons with respect to TAT-14 or any part thereof,  or which may arise          in relation to TAT-14 due to any law,  order or regulation  made by any          government   or   international   legal   authority   pursuant  to  any          international  convention,  treaty or agreement.  Any such liabilities,          costs, damages or obligations shall be divided among the Parties in the





         proportions of their  respective  ownership  shares in accordance  with          Schedule B.

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26       RELATIONSHIP OF THE PARTIES

         The relationship  between or among the Parties hereto shall not be that          of partners or joint  ventures and nothing  herein  contained  shall be          deemed to constitute a  partnership  between them. In relation to third          parties, the Parties will not act as partners,  or as any kind of joint          legal entity. Any co-operation among the Parties in Committees,  Groups          or  Subcommittees  is  only  to  facilitate  the  performance  of  this          Agreement.

27       OBTAINING OF LICENSES

27.1     The Parties  shall at all times hold the  governmental  and  regulatory          approvals  necessary to operate as an ITE.  The Parties  shall make all          reasonable  efforts to obtain the  appropriate  consents,  governmental          authorizations,  licenses  and  permits  necessary  to carry  out their          duties under this Agreement.

27.2     The  Terminal  Parties  will  use  all  reasonable  efforts,  in  their          respective  Country,  to obtain  and to have  continued  in effect  all          governmental approvals, consents, authorizations, licenses, and permits          for  the  construction  and  operation  of  TAT-14  in  the  respective          Countries.

27.3     In the event that any Terminal  Party fails,  or is likely to fail,  to          obtain such approvals, consents,  authorizations,  licenses or permits,          that Terminal Party shall give  immediate  notice to the Managing Group          for it to take appropriate action pursuant to this Agreement.

28       PRIVILEGES FOR DOCUMENTS OR COMMUNICATIONS

         Each Party hereto specifically  reserves, and is granted by each of the          other Parties,  in any action,  arbitration or other proceeding between          or among  the  Parties  or any of them in a  Country  other  than  that          Party's own Country,  the right of privilege,  in  accordance  with the          laws of that  Party's own  Country,  with  respect to any  documents or          communications  which are material and pertinent to the subject  matter          of the action,  arbitration or proceeding as respects  which  privilege          could be claimed or  asserted  by that Party in  accordance  with those          laws, and such privilege, whatever may be its nature and whenever it be          claimed  or  asserted,  shall be  allowed  to that Party as it would be          allowed if the action, arbitration or other proceeding had been brought          in a court of, or before an arbitrator in, the Party's own Country.

29       CONFIDENTIALITY

29.1     All data and  information  that is acquired or received by any Party in          anticipation of or under this Agreement shall be confidential and shall          not be divulged in any

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 30

         way to any third party, without the prior written approval of the other          Parties,  nor shall it be used for any purpose beyond the scope of this          Agreement. Any Party may, without such approval, disclose such data and          information to:

         (i)    the employees of that Party; or          (ii)   the extent  required by any applicable  laws, or the requirement                 of any recognized  stock  exchange in compliance  with its rules                 and  regulations  or in the  case if a party  wholly  owned by a                 sovereign  government,  by the rules of governance of the Party,                 or          (iii)  any   government   agency  or  regulatory   authority   lawfully                 requesting such information or to which such  information  needs                 to be  submitted  in order to obtain  any  necessary  consent or                 approval', or          (iv)   any Court of competent  jurisdiction  acting in pursuance of its                 powers; or





         (v)    professional  advisors,  auditors  and  bankers or any bona fide                 intending  assignee  upon  obtaining  a similar  undertaking  of                 confidentiality; or          (vi)   the  extent  that  such data  and/or  information  is  generally                 available to the public.

         Any Party may disclose such data and information to such persons as may          be necessary in  connection  with the conduct of  operations  of TAT-14          upon  obtaining  a similar  undertaking  of  confidentiality  from such          persons.

29.2     Each Party shall remain bound by the  provisions  of this  Paragraph 29          during  the period of this  Agreement  and for the period of five years          following termination of this Agreement.

30       ASSIGNMENT OF RIGHTS AND OBLIGATIONS

30.1     No Party may assign,  sell, transfer or dispose of part or parts of its          rights or obligations under this Agreement except as otherwise provided          for in Paragraph 9.

30.2     A Party may assign the whole of its rights  under this  Agreement  to a          successor  by  law,  Subsidiary  or  Affiliate  of  such  Party,  or  a          corporation or an entity  jointly  controlling or under the same common          control as such Party,  provided that the assigning  Party shall remain          jointly and severally  liable with the assignee for the  performance of          this  Agreement for the duration of the  Agreement.  The Managing Group          may  decide  that the  assigning  Party  will not  remain  jointly  and          severally  liable  with  the  assignee  for  the  performance  of  this          Agreement for the duration of the Agreement provided that the assigning          Party will give  notice to the other  Parties in a timely  manner,  and          provided  that  the  assignee  agrees  in  writing  to be  bound by the          provisions of this Agreement.

30.3     Except in accordance  with  Subparagraph  30.2, no Party may assign the          whole of its rights under this Agreement without the written consent of          all the other Parties, such consent shall not be unreasonably withheld.

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30.4     If a governmental or other regulatory  approval is required lawfully to          effect  the  proposed   assignment,   the  assigning   Party  shall  be          responsible,  at its  own  expense,  for  preparing  and  pursuing  the          application  for such  approval.  Such  approval  shall be  obtained in          advance  of  the  assignment   unless  the  relevant   governmental  or          regulatory  authority  has  formally  indicated  in  writing  that  the          transfer may proceed in advance of the receipt of the formal approval.

30.5     In each such case of  assignment  written  notice shall be given to the          other Parties in a timely manner by the Party making said assignment.

31       WAIVER

         Silence,  lateness to invoke or the waiver by any Party of a breach of,          or a default  under,  any of the provisions of this  Agreement,  or the          failure of any Party, on one or more  occasions,  to enforce any of the          provisions  of this  Agreement  or to exercise  any right or  privilege          hereunder,  shall  not  thereafter  be  construed  as a  waiver  of any          subsequent breach or default of a similar nature, or as a waiver of any          such provision, right, or privilege hereunder.

32       COMMUNICATIONS

         Any notice under this Agreement shall be delivered by hand, first class          mail with postage  prepaid,  facsimile or e-mail and shall be deemed to          have been given:

         (i)    when  delivered if delivered by hand,  facsimile or e-mail (with                 receipt acknowledged); or;          (ii)   at the  expiration  of ten (10) days (or thirty (30) days,  if a                 notice  of  termination  of this  Agreement)  from  the  date of                 dispatch if delivered by mail.

33       PARAGRAPH HEADINGS, REFERENCES

         Headings  are inserted  for  convenience  only and shall not affect the          interpretation of this Agreement,  References to recitals, clauses, and          attachments  are to  recitals  and  clauses  of and  Schedules  to this





         Agreement.  Unless the context otherwise requires,  words importing the          singular  number  shall  include the plural and vice versa.  Unless the          context  otherwise   requires,   references  to  a  person  include  an          individual,  firm, body, corporation,  unincorporated association,  and          government or  governmental,  semi-governmental  or local  authority or          agency. Reference to the male shall include the female.

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34       SEVERABILITY

         If any of  the  provisions  of  this  Agreement  shall  be  invalid  or          unenforceable, such invalidity or unenforceability shall not invalidate          or render  unenforceable  the entire  Agreement,  but rather the entire          Agreement  shall  be  construed  as if not  containing  the  particular          invalid or  unenforceable  provision or provisions,  and the rights and          obligations of the Parties shall be construed and enforced accordingly.

35       EXECUTION OF AGREEMENT AND AMENDMENTS

35.1     Except for  revisions to the relevant  Schedules,  in  accordance  with          Paragraphs  9,  11 and 21 of this  Agreement,  the  provisions  of this          Agreement may be amended or supplemented  only by unanimous  consent of          all the Parties to this Agreement through an Amendatory Agreement. Such          an  Amendatory   Agreement   shall  be  signed  by  a  duly  authorized          representative  of each and every Party or by certain Parties on behalf          of all the Parties, as decided by the General Committee.

35.2     This Agreement and any Amendatory  Agreement  thereof shall be executed          in three  counterparts in English.  The NA, one Eastern  Terminal Party          and one Western Terminal Party shall receive originals. The NA shall be          the official custodian of the Agreement and shall accord access to such          Agreement and any Amendatory  Agreement.  The Parties to this Agreement          shall be  provided a certified  photocopy  of any  counterpart  and any          revised Schedules.

35.3     For revision to the relevant  Schedules,  in accordance with Paragraphs          9, 11 and 21 of this Agreement, the agreement in writing of the Parties          having  their  ownership   percentages   increased  or  their  capacity          assignment changed will be required to formalize the revised Schedules,          which will be considered as part of this Agreement, in substitution for          the preceding version of those Schedules.

36       INTERPRETATION OF THE AGREEMENT AND SETTLEMENT OF DISPUTES

36.1     The  construction,  interpretation  and  performance  of this Agreement          shall be governed by the laws of Switzerland,  except for its conflicts          of law principles.

36.2     Any dispute relating to this Agreement or its subject matter, including          disputes as to validity,  performance,  breach,  or termination,  which          cannot be settled by mutual  agreement  between the  Parties,  shall be          submitted to binding  arbitration  under the Rules of Conciliation  and          Arbitration of the International Chamber of Commerce as in force on the          date of the  commencement  of the  arbitration  and as modified by this          arbitration  clause. The appointing and administering body shall be the          International Chamber of Commerce.  There shall be only one arbitrator.          The  arbitration  shall  take  place in  Geneva,  Switzerland,  and the          proceedings shall be conducted in the English language. The award shall          be final and binding and the Parties hereby waive all means of recourse          to the courts of

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         Switzerland or any other Country.  Jucgment on the award may be entered          in any court of competent Jurisdiction.

37       SUCCESSORS BOUND

         This Agreement  shall be binding on the Parties,  their  successors and          permitted assigns.





38       ENTIRE AGREEMENT

38.1     This  Agreement  represents  the  entire  understanding  and  agreement          between the Parties in relation to the matters  dealt with herein,  and          supersedes all previous representations, understandings and agreements,          whether oral or written, relating thereto.

38.2     It includes  the  following  documents  which are  attached  hereto and          incorporated herein by reference

                                    SCHEDULES

SCHEDULE A     PARTIES TO THE AGREEMENT

SCHEDULE B     VOTING INTERESTS, OWNERSHIP  INTERESTS IN SEGMENTS AND ALLOCATION                OF CAPITAL, OPERATING AND MAINTENANCE COSTS IN SEGMENTS S AND T.

SCHEDULE C     SUMMARY OF ALLOCATED CAPACITY

SCHEDULE C-1   SUMMARY OF ALLOCATED  CAPACITY  AS  ASSIGNED  AT THE TIME OF C&MA                SIGNING

                                     ANNEXES

ANNEX 1     TERMS OF REFERENCE FOR MANAGING GROUP

ANNEX 2     TERMS OF REFERENCE FOR THE PROCUREMENT GROUP

ANNEX 3     TERMS OF REFERENCE FOR THE AR&R SUBCOMMITTEE

ANNEX 4     TERMS OF REFERENCE FOR THE F&A SUBCOMMITTEE

- -------------------------------------------------------------------------------- September 2, 1998                                                        Paqe 34

ANNEX 5     TERMS OF REFERENCE FOR THE CENTRAL BILLING PARTY

ANNEX 6     TERMS OF REFERENCE FOR THE NETWORK ADMINISTRATOR

ANNEX 7     SOURCE OF FINANCIAL CHARGE RATES

ANNEX 8     INITIAL OWNERSHIP PRICING MATRIX

ANNEX 9     CAPACITY STRUCTURE

ANNEX 10    ORGANIZATION STRUCTURE

ANNEX 11    CONFIGURATION DIAGRAM

39       TESTIMONIUM

IN WITNESS  WHEREOF the Parties  have  severally  subscribed  these  presents or caused  them to be  subscribed  in  their  names  and on their  behalf  by their respective officers thereunto duly authorized.

     For and on behalf of      ABS Telecom plc

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

     For and on behalf of      AT&T Corp.

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

     For and on behalf of





     BARAK I.T.C

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- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 35

     For and on behalf of      BC TEL

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

     For and on behalf of      Belgacom S.A.

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

     For and on behalf of      BellSouth International, Inc.

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

     For and on behalf of      British Telecommunications pIc

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

     For and on behalf of      Cable & Wireless Global Network Organisation Limited

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

- -------------------------------------------------------------------------------- September  2, 1998                                                       Paqe 36

     For and on behalf of      Cable & Wireless, Inc.

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

     For and on behalf of      Carrier 1 AG

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

     For and on behalf of      COMPANHIA PORTUGUESA RADIO MARCONI, SA.

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





     For and on behalf of      Com Tech International Corporation

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

     For and on behalf of      CYPRUS TELECOMMUNICATIONS AUTHORITY

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 37

     For and on behalf of      Deutsche Telekom AG

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

     For and on behalf of      Energis Communications Limited

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

     For and on behalf of      Emirates Telecommunications Corporation - ETISALAT

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

     For and on behalf of      France Telecom

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

     For and on behalf of      GTE Intelligent Network Services Incorporated

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

- -------------------------------------------------------------------------------- September 2, 1998                                                         Page38

     For and on behalf of      Hellenic Telecommunications Organisation S.A.

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

     For and on behalf of IXC Communications, Inc.      For and on behalf of

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





     IXNET Limited

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

     For and on behalf of      Japan Telecom Co., Ltd.

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

     For and on behalf of      Kokusai Denshin Denwa Americas Inc.

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 39

     For and on behalf of      KPN Telecom B.V

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

     For and on behalf of      MCI International Inc.

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

     For and on behalf of      NTT Worldwide Network Corporation

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

     For and on behalf of      OY FINNET International AB

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

     For and on behalf of      Pacific Gateway Exchange

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- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 40

     For and on behalf of      Pacific Gateway Exchange Inc.

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





- -------------------------------------------------------------------------------- September 2, 1998                                                       Page 40a

     For and on behalf of      Rostelecom

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

     For and on behalf of      RSL Communications Limited

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

     For and on behalf of      Singapore Telecommunications Limited

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

     For and on behalf of      Slovenske Telecomunicatie s.e.

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

     For and on behalf of      Sonera Ltd.

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 41

     For and on behalf of      Sprint Communications Company L.P.

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

     For and on behalf of      STAR Telecommunications Inc.

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

     For and on behalf of      StarHub

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     For and on behalf of      STARTEC GLOBAL COMMUNICATIONS CORPORATION

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

     For and on behalf of      Swisscom Ltd

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 42

     For and on behalf of      Swisscom North America Inc.

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

     For and on behalf of      Tele 2 AB

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

     For and on behalf of      TeleBermuda International Limited

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

     For and on behalf of      Tele Danmark A/S

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

     For and on behalf of      Telef6nica de Espana, S.A.

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- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 43

     For and on behalf of      Teleglobe USA

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

     For and on behalf of      Telenor Global Services AS

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





     For and on behalf of      Telesur

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

     For and on behalf of      TELIA AB (publ)

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

     For and on behalf of      Telia North America Inc.

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 44

     For and on behalf of      Transoceanic Communications Incorporated

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

     For and on behalf of      Turk Telekomunikasyon A.S.

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

     For and on behalf of      Ultrallne (Bermuda) Limited

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

     For and on behalf of      VIATEL

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

     For and on behalf of      Videsh Sanchar Nigam Limited

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

- -------------------------------------------------------------------------------- September 2, 1998                                                        Page 45 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?
Should the Managing Group agree to jointly          insure against such risks, the cost of such insurance will form part of          the capital costs referred to in Subparagraph 13.1.

SeattleSoftwareDevelopers

SOFTWARE DEVELOPMENT AGREEMENT

PELICAN DELIVERS iOS APPLICATION  ENHANCEMENTS & WEB APPLICATION  DEVELOPMENT PHASE 1 4 102nd Ave NE Suite 300 Bellevue, WA 98004 (425) 256-2815 julian@seattlesoftwaredevelopers.com www .seattlesoftwaredeveIopers.com

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





STATEMENT OF WORK - APPENDIX A This Statement of Work is issued to and made part of that Software Development Agreement executed by and between Developer and Client on the Effective Date (the Agreement). Any word or phrase not otherwise defined in this Appendix will have the meaning ascribed in the Agreement.

1. Project Overview The purpose of this project is to develop additional features for the Pelican Delivers software. This includes POS integration, Google Maps API, payment processing features, ID verification, reporting, driver app improvement and workflow, and a front facing web application for customers to find, order, and receive products via deliver or pickup.

2. Specifications Number of applications included in Phase 1:1 Tech Stack: iOS (Objective - C or Swift), PhP, MySQL, AWS Hosting, jQuery, and JavaScript language: English Design: Custom to client

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





3. Delivery Schedule Based on the current requirements and this SOW, Seattle Software Developers estimates that this project will take around six [4] months of development, testing, and deployment. This estimate may change depending on unforeseen circumstances or requirements. We estimate that the website (Customer Portal) will take 3 months to complete because this will be the priority.

4. Fee Payment Schedule Fees: The Fees for the Project shall be $279,000.00 Payment Schedule: Client shall pay Developer: 20% Deposit ($55,800.00) to be paid at the start of the project. 20% ($55,800.00) to be paid upon completion of Milestone #1. 20% ($55,800.00) to be paid upon completion of Milestone #2. 20% ($55,800.00) to be paid upon completion of Milestone #3. 20% ($55,800.00) to be paid upon completion of Milestone #4.

*Milestone Delivery Schedule for Phase 1

Milestone #1 -January 1st, 2019 Milestone #2- February 1st, 2019. Milestone #3 - March 1st, 2019. Milestone #4 - April 1st, 2019.

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





5. Statement of Work Website (Customer Portal) Users will be able to go to the Pelican Delivers front-end website and easily search, browse, and order cannabis. Before a user can gain access to the website, they must first verify their birthday (users must be 21 and over to even view the website). · Header o There will be a header with a few basic informal menu items such as Home, How It Works, Features, etc. o To the very right there will be a Login/ Signup button and My Cart · Login / Signup o This will prompt the user to either Login or Signup for a new account o Login will ask the user for their email ID and password § If users have forgotten their password, they can click the Forgot Password link which will provide them with a recovery email · New users can select Sign-up and go through the quick and easy sign-up process. The application will ask for the user's: § Email § Password / Confirm Password § First Name § Last Name § Phone Number § Birthday · Profile o After the user logs in they can view their profile which will allow them to: § Edit their profile information § Add and verify their ID § Add delivery addresses § Select current delivery address o Users shall also be able to add their payment information § This is where the application will use Daily Pay and link to the customers bank · My Orders o Users can view their open orders, processing orders, in progress orders, and delivered § Open order - Customer has clicked checkout but has not paid, app is searching for drivers to fulfill the order.

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





§ Processing order - A driver has accepted the delivery request and the dispensary has been alerted to prepare the products for pickup. Payment has been successfully submitted by the customer. § In progress order -The driver has purchased the product from the vendor and is now on the way to delivering the product to the customer. § Delivered order -The driver has delivered the product to the customer and the customer has confirmed receipt of the order. o Users can also access their history and re-order the same products from a dispensary. This feature clears their current cart and populates it with the products from the previous order. · Search o The search bar will be powered by Google Maps o Search results will vary depending on the user's current delivery address in their profile or they can search another address in the search field o Results can be viewed in either a Map View or a List View o The only dispensaries that will be displayed are ones that can delivery to that address and are open. Closed stores will be displayed at the bottom of the screen and be grayed out o Results will have the dispensaries logo, name, address, phone number, and open hours · Selecting Dispensary o When users select a dispensary, they'll be able to search for products, navigate through categories, view products details (farm, THC, CBD, etc.), and change the size of the item o To order a user can hover over the item and click Add to Cart o Once a product has been added to cart, the My Cart in the header will update o By going to My Cart users can check-out and pay · Payment o Users will pay by linking their bank accounts via Evergreen Gateway o Account information will be stored and used for future orders o Once payment is confirmed users may proceed to completing their order · Age / ID Verification o After payment is confirmed users must upload their government issued ID and a selfie o Trulioo will verify if the issued ID is valid and if the selfie matches the ID o Once verification is completed the user will be able to complete the order · Check out o If customer ID has been verified and the customer's cart is confirmed, the application will search for nearby drivers. § If a driver is found, the driver can either accept of decline the order · Drivers will be notified one at a time (queue system), with the river closest to the dispensary being notified first, then the next driver, etc. · Each driver will have a set amount of time (e.g. 10 seconds) to accept or reject the order, or the order will automatically be rejected by time and the lack of response will be recorded for future reference/internal driver ranking in the future. § If the driver accepts, the dispensary will be notified of the order § If the driver declines, the application will look for another drive

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





o If no drivers are found, users will not be charged and will have the option to pick up the order in-store or browse for a new dispensary o If an order is accepted the dispensary will begin preparing the product for the driver to pick up o Customers will receive updates on the status of their order via SMS, email, or website Dispensary Portal Before dispensaries can access their account, they must provide the owners first and last n me, email, phone number, OBA, License Number, and upload a picture of their license. This process can be submitted manually or through an online form. Once Pelican verifies all their information, Pelican administrators can authorize the dispensaries account and the dispensary will be given credentials to access the dispensary portal. The application will have a database of business and license information provided by Pelican to help automate the verification process, however Pelican administrators must still manually authorize new dispensaries. · POS System o The application will tie into the dispensaries POS system and pull the inventory, product details, price, and quantity o The application will pull data from the POS system once every 1-2 hours o If a product is low, it will not be displayed on the front-end website or mobile apps § The low quantity can be defined by the dispensary § Ability for dispensary owner to input Username and Password for PO system connection using the Greenbits login to authenticate and connect. · Notifications o The application will notify dispensaries when an order comes through via § Email § Portal Notification § New orders will be listed at the top of the list · Orders o Dispensaries will be able to view the status of an order. New orders will be at the top of the list. The order will either be for pickup or delivery. § If the order is for pick up the dispensary just needs to prepare the order and wait for the customer to arrive § If the order is for delivery the dispensary will prepare the order and view the driver associated to that order § Once the driver comes in to pay and pick-up the order the dispensary ill verify the driver by matching the order ID and having the driver release funds for the purchase § After funds have been released the status of the order will be automatically updated and the dispensary the driver will begin delivering the product to the customer

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





o Dispensaries can run basic reports on orders § Products § Dates § Product / Product Details § Quantity § Product Size § Delivery Address I City § Revenue · Products o Products will be populated by pulling inventory from POS system § Script will run every 1-2 hours to update the inventory o Have the ability to associate multiple images to products Admin Portal · Verifications o Admins will manually verify new dispensaries that sign-up by reviewing their uploaded documents § Once verified they can select Approved and that will grant the dispensary access to the portal · If accepted, it will send an automated email to the dispensary notifying them § Admins can decline the application. · If declined it will send an automated email to the dispensary notifying them o Driver ID and License verification § Driver applications displayed here with uploaded licenses · Drivers will have to fill out and upload a 1099 or w-9 tax document. · Once all documents are verified a green check mark next to background check will appear · Reports Reports will be very basic for phase 1. Seattle Software Developers will try their best to complete the following features in Phase 1 but will not be penalized if they are pushed to Phase 2. o Dispensary orders by history/volume over custom time periods o Order Details broken down by dispensary o Driver transaction history · User management o User creation/management for dispensaries, drivers and customers, including viewing basic profile information and password resets. o Ability to add funds to driver, dispensaries and customers to their Pelican accounts.

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Back-end Development · Evergreen Gateway o Customer payments go into Evergreen Gateway o Payments are distributed from Evergreen Gateway via Daily Pay to drivers and dispensaries · Daily Pay o Customer orders the product and pays Pelican through Evergreen Gateway. o Payment is held in Pelican's escrow account in Evergreen Gateway. o Order goes into a pending / processing status. o When the driver goes to pick up the product, he/she brings up the order and hits release funds in the phone after verifying the order. o The money goes to the dispensaries Daily Pay account, and they can withdraw from the Evergreen Gateway accounts through the daily pay application / APL o When the driver delivers the order and customer acknowledges order received, then the driver and Pelican get paid. o Stores and Drivers will both have Daily Pay accounts tied to their bank accounts. o Driver will scan the customers ID using the Trulioo API right before they handle the delivery to the customer. After this last ID check, the transaction will be completed. · Trulioo o Will be used to verify government issued IDs o Compare and match users ID with selfie's o Make sure users are of age · Twilio o Will be used for client to customer communication during an order · Payouts, Subscription fees, flat fees, commissions fees § Commission fees - 25% commission on delivery orders. Admin will have the ability to change the % or fee based on dispensary § Flat fees - $1 in store pickup orders through the app or website § Subscription Fee - $500 a month subscription per store · Top sponsors will pay $750 instead of $500 § Withdrawing Fee - $1 fee added to the existing daily pay fees § Delivery fee - 20% of delivery fee will go to Pelican. 80% will go to driver · Integrating with Dispensaries POS system o Dispensaries menu should be searchable for web. o Spider / crawling SEO o Only working on integrating with Greenbits for phase 1 · State Module - Creating state rules o Legal age to purchase o State is recreational or medical or both o Purchase limits - how much product can a customer purchase at a time

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





o If Medical Marijuana State - we will need an upload feature for customers to upload their medical marijuana recommendation (no medical orders will be allowed in phase 1) · Dispensary Sign Up o When new retail shops sign up, they will have a list of available zip codes o Only one dispensary per zip code will be allowed o Once a zip code is claimed it will not be available until that dispensary stops he monthly fee or gets removed from the system Driver Companion App (iOS) The driver companion app will be available on the iOS platform for Phase 1 but will eventually be made available on Android. The companion app will allow drivers to signup, become authenticate and authorized by Pelican, create/link their payment accounts, view orders, choose to confirm orders, navigate to dispensaries/customers, and view order histories. Ability to Start and End shift. Makes driver active or inactive. · Login / Signup o This will prompt the driver to either Login or Signup for a new account o Login will ask the drivers for their email ID and password § If drivers have forgotten their password, they can click the Forgot Password link which will provide them with a recovery email o New drivers can select Sign-up and go through the quick and easy sign-up process. The application will ask for the user's: § Email § Password / Confirm Password § First Name § Last Name § Phone Number § Birthday § Driver's License § Car License Plate # § Car Make/Model and photo § Driver Photo § Upload car insurance paperwork · Profile o After the driver logs in they can view their profile which will allow them to: § Edit their profile information § Change Password § Submit vehicle change information § Set Delivery Radius (open orders within this radius will be shown to the driver) § Drivers can also add their bank account information and withdraw Daily Pay funds

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





· Delivery Info o Drivers can view Open Orders within their radius and select them for deliver § Time estimates will come based on Google API § Once a driver has selected an Open Order and the customer has completed the purchase, the Order changes to Processing Order and allows the Driver to navigate to the Dispensary. § After arriving at the dispensary, driver can press Order Pickup, which signals the driver has purchased the product from the dispensary. § Driver can then navigate to the customer for product delivery, customer can view driver's eta based on their location and Google navigation results. § If the driver has any issues with product pickup or delivery, they can contact the customer via SMS (using Twilio API) § Upon arrival at customer location, driver must verify customer identity by taking a picture of/scanning the customer's ID. Once the customer's ID is verified and the product is delivered, the customer must confirm receipt of the product for the order to be considered complete. · Delivery History o Drivers will be able to view their previous deliveries

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020





7. Acknowledgement by Client Client agrees to the terms of the Statement of work Appendix A hereto attached and acknowledges receipt of a copy of this Agreement. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date. Acceptance by Developer SEATTLE SOFTWARE DEVELOPERS, Inc. By: /s/ Julian Valentine Julian Valentine, VP

Acceptance by Client: PELICAN DELIVERS INC. By: /s/ Dave Comeau Dave Comeau, Shareholder

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Source: PELICAN DELIVERS, INC., S-1, 2/11/2020 
Question: Highlight the parts (if any) of this contract related to Parties that should be reviewed by a lawyer. Details: The two or more parties who signed the contract
PELICAN DELIVERS INC.