Document:

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

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

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

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

<PAGE>

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

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

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

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

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

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

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

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<PAGE>

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

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

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

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

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

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

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

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<PAGE>

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

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

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

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

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

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

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

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

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

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

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

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

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

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<PAGE>

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

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

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

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

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

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

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

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

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

         "NYSE" means the New York Stock Exchange.

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

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

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<PAGE>

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

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

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

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

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

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

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

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

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

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

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

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<PAGE>

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

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

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

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

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

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

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

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

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

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<PAGE>

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

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

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

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<PAGE>

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

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

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

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<PAGE>

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

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

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

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<PAGE>

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

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

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<PAGE>

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

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

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

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<PAGE>

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

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

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<PAGE>

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

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

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

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

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

                                       14

<PAGE>

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

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

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

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

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

                                       15
<PAGE>

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

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

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

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

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

                                       16

<PAGE>

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

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

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

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

                                       17
<PAGE>

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

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

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

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

                                       18

<PAGE>

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

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

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

                                       19

<PAGE>

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

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

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

                                       20

<PAGE>

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

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

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

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

                                       21

<PAGE>

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

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

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

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

                                       22
<PAGE>

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

                                       23
<PAGE>

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

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

                                       24
<PAGE>

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

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

                                       25

<PAGE>

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

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

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

                                       26
<PAGE>

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

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

                                       27
<PAGE>

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

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

                                       28
<PAGE>

         (f) If:

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

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

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

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

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

                                       29

<PAGE>

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

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

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

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

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

                                       30
<PAGE>

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

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

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

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

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

                                       31
<PAGE>

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

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

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

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

                                       32

<PAGE>

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

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

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

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

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

                                       33

<PAGE>

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

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

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

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

                                       34
<PAGE>

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

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

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

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

                                       35

<PAGE>

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

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

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

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

                                     NTL INCORPORATED

                                     By:
                                        ----------------------------------------
                                        Name:   Richard J. Lubasch
                                        Title:  Executive Vice President,
                                                General Counsel and SecretaryDated February 17, 2000

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

                            BANQUE NATIONALE DE PARIS

                            CREDIT AGRICOLE INDOSUEZ

                                DEUTSCHE BANK AG
                                  PARIS BRANCH

                      WESTDEUTSCHE LANDESBANK GIROZENTRALE
                                  PARIS BRANCH

                                       and

                                 FRANCE TELECOM

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

                          PUT AND CALL OPTION AGREEMENT

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

<PAGE>

                                TABLE OF CONTENTS
                                -----------------

                                                                            Page
                                                                            ----

1.  Definitions and Interpretation.............................................1

2.  Conditions.................................................................6

3.  Put Option.................................................................7

4.  Call Option................................................................8

5.  Sale Price and Refund of Option Premium....................................9

6.  Fees, Option Premium and Default Interest.................................10

7.  Payments..................................................................11

8.  Undertakings..............................................................12

9.  Representations and Warranties............................................14

10. Put Acceleration Events...................................................17

11. Indemnity.................................................................20

12. Increased costs...........................................................22

13. Mitigation by the Finance Parties.........................................23

14. Costs and Expenses........................................................24

15. Possible Extension of the Call Option Period and of the Put Option Period.24

16. Assignments and Transfers.................................................26

17. Bank Representative.......................................................26

18. Accession of New Banks....................................................29

19. Applicable Law and Jurisdiction...........................................29

20. Entire Agreement..........................................................29

21. Notices...................................................................29

22. Remedies and Waivers......................................................31

EXHIBIT 3.3    NOTICE

EXHIBIT 3.4    STOCK POWER

EXHIBIT 18     FORM OF ACCESSION NOTICE TO BE DELIVERED BY AN ADDITIONAL BANK
               PURSUANT TO CLAUSE 18

<PAGE>

THIS AGREEMENT (this "Agreement") is made on February 17, 2000

AMONG:

BANQUE NATIONALE DE PARIS whose principal place of business is at 16 boulevard
des Italiens, 75009 Paris France, represented by Lionel Bordarier and Christophe
Delafontaine ("BNP");

CREDIT AGRICOLE INDOSUEZ whose principal place of business is at 9, Quai du
President Paul Doumer, 92400 Courbevoie France, represented by Michel Chabanel
and Damien Scaillierez ("CAI");

DEUTSCHE BANK AG acting through its Paris branch whose principal place of
business is at 3 avenue de Friedland, 75008 Paris, represented by Benoit
Deschamps and Antoine de Maistre ("DB");

WESTDEUTSCHE LANDESBANK GIROZENTRALE acting through its Paris branch whose
principal place of business is at 15 avenue de Friedland, 75008 Paris,
represented by Barbara Selves and Nadine Veldung ("West LB");

(BNP, CAI, DB and West LB are hereafter referred to each as a "Bank" and
collectively as the "Banks")

and

FRANCE TELECOM whose principal place of business is at 6 Place d'Alleray, 75505
Paris, Cedex 15, France, represented by Eric Bouvier and _______________________
("France Telecom").

IN CONSIDERATION OF THE MUTUAL COVENANTS HEREIN CONTAINED, IT IS HEREBY AGREED
as follows:

1.     Definitions and Interpretation

1.1    Definitions

       The following words and expressions where used in this Agreement have the
       meanings given to them below:

       "Additional Bank" has the meaning set forth in clause 18 Accession of New
       Banks;

       "Affiliate" means in relation to any person, a Subsidiary of that person
       or a Holding Company of that Person or any other Subsidiary of that
       Holding Company;

<PAGE>

       "Banks" has the meaning set forth at the beginning of this Agreement to
       also include any Additional Bank after its accession to this Agreement in
       accordance with the provisions of clause 18 Accession of New Banks;

       "Bank Representative" means CAI, appointed pursuant to clause 17 Bank
       Representative in its separate capacity to act as the Banks'
       representative or any successor named as Bank Representative pursuant to
       the terms of this Agreement;

       "Borrowed Monies Indebtedness" means any indebtedness of any person:

       (i)    for monies borrowed;

       (ii)   whether actual or contingent under any guarantee, security,
              indemnity or other commitment designed to assure any creditor
              against loss in respect of any Borrowed Monies Indebtedness of any
              third party;

       (iii)  under any acceptance credit having a term exceeding 90 days from
              the date of issue;

       (iv)   under any debenture, bond, note, bill of exchange or commercial
              paper;

       (v)    for amounts actually owing in respect of any interest rate swap or
              cross-currency swap or forward sale or purchase contract; or

       (vi)   in respect of the payment obligations under any lease entered into
              for the purpose of obtaining or raising finance;

       "Business Day" means any day on which banks are open for general business
       in New York City and Paris, excluding Saturdays and Sundays;

       "Call Completion Date" has the meaning set forth in clause 4.2;

       "Call Option" means the right of France Telecom (exercisable during the
       Call Option Period) to acquire all (but not less than all) of the Option
       Stock from the Banks at a price equal to the sum of all Sale Prices as
       set forth in clause 4.1;

       "Call Option Period" means the period during which the Call Option can be
       exercised (within the meaning of clause 1.2.5.), being the period
       commencing on the Date of Issue and ending 5 Business Days before the
       Termination Date;

       "Completion Date" means any Call Completion Date or Put Completion Date
       being the day on which France Telecom completes the sale and purchase of
       Option Stock from Banks;

                                       2

<PAGE>

       "Consolidated Net Worth" means the aggregate of the amount paid up or
       credited as paid up on the issued ordinary share capital of France
       Telecom including any capital reserves and retained earnings deducting
       (to the extent included) any minority interests, all as determined by
       reference to its most recent consolidated financial statements prepared
       in accordance with generally accepted accounting principles in France
       relating to commercial and industrial companies;

       "Date of Issue" means the date of issue, sale and delivery of the
       Preferred Stock pursuant to the Purchase Agreement;

       "Dollars" and "US$" mean the lawful currency of the United States of
       America;

       "Finance Party" means the Bank Representative or a Bank;

       "Group" means France Telecom and its Subsidiaries;

       "Holding Company" means in relation to a company or corporation, any
       other company or corporation in respect of which the former is a
       Subsidiary;

       "LIBOR" means in relation to each Premium Period or other period
       concerned (which shall not vary during such period when fixed), the
       London Interbank Offered Rate for deposits in Dollars for an equivalent
       period (or, for any period which is not exactly divisible by a month, for
       a period rounded upwards to the nearest month) as displayed on the
       relevant page (T 3750) of the Reuters Monitor Money Rates Service (or, if
       the agreed page is replaced or that service is unavailable, such
       alternative page or service as the Bank Representative may select) at or
       about 11 A.M. on the second London banking day before the first day of
       such period; if no rate available as provided above, LIBOR means the
       arithmetic mean of the rates (rounded upwards to four decimal places) as
       supplied to the Bank Representative at its request quoted by the
       Reference Banks to leading banks in the London interbank market at or
       about 11 A.M on the second London banking day before the first day of the
       period concerned for deposits in Dollars for an equivalent period;

       "Majority Banks" means as long as the number of Banks is four, at least
       two Banks and at any other time, Banks the sum of whose Purchase Prices
       represent an amount equal to or greater than 50% of the sum of all
       Purchase Prices at such time;

       "Market Disruption Event" means:

       (i)    when LIBOR is to be determined by reference to the Reference Banks
              as provided in the definition of LIBOR and none or only one of the
              Reference Banks supplies a rate to the Bank Representative to
              determine LIBOR for the relevant Premium Period or other period
              concerned, or

       (ii)   before close of business day in London on the day where LIBOR must
              be determined for a given Premium Period or for another period
              concerned, the Bank Representative receives notification

                                       3

<PAGE>

              from a Bank or Banks that the cost to it or to them of obtaining
              matching deposits in the London Interbank Market would be in
              excess of LIBOR;

       "NTL" means NTL Incorporated, a Delaware corporation (or its successor
       company);

       "Option Premium" means the premium from time to time payable pursuant to
       clause 6 Fees, Option Premium and Default Interest;

       "Option Stock" means the aggregate of 275,000 shares of Preferred Stock
       held by BNP, 275,000 shares of Preferred Stock held by CAI, 275,000
       shares of Preferred Stock held by DB and 275,000 shares of Preferred
       Stock held by West LB, the number of Preferred Stock held by each
       Additional Bank, if any, and (in each case) shall include any further or
       additional securities allotted in respect thereof (whether by way of
       distribution, bonus or otherwise) or in substitution therefor (whether as
       a result of conversion, the implementation of a scheme of arrangement or
       similar proposal or otherwise howsoever);

       "Overnight Rate" means the rate quoted daily as the overnight rate in the
       London interbank market for deposits in Dollars and listed in the
       relevant page of the Reuters Monitor Money Rates Service;

       "Preferred Stock" means the series of redeemable 5% preferred shares of
       NTL issuable to and purchasable by the Banks and France Telecom under the
       Purchase Agreement;

       "Premium Payment Date" means each of the dates as set out in the table
       under the definition of "Relevant Margin";

       "Premium Period" means the period between each Premium Payment Date,
       other than the fourth Premium Period, which will be the period between
       the fourth Premium Payment Date and the date two years after the Date of
       Issue;

       "Prepaid LIBOR" means in relation to each Premium Period or other period
       concerned, the rate equivalent in present value to the LIBOR rate
       determined in actuarial terms, to be calculated as follows:

       PL = LIBOR 6 months X 360
            --------------------------
            360 + (LIBOR 6 months X j)

       where "PL" is the Prepaid LIBOR and "j" is the number of days comprising
       the period for which Prepaid LIBOR is calculated.

       "Protected Party" means a Finance Party which is or will be, for or on
       account of Tax, subject to any liability or required to make any payment
       in relation to a sum received or receivable (or any sum deemed for the
       purpose of Tax to be received or receivable) under this Agreement or in
       connection with the Option Stock (including any dividend related
       thereto);

                                       4

<PAGE>

       "Purchase Agreement" means the agreement dated the date of this Agreement
       among NTL, France Telecom and the Banks (including the attached
       Certificate of Designation, as defined in the Purchase Agreement)
       relating to the issuance by NTL to, and the purchase by France Telecom
       (or its assignees) and the Banks of, the Preferred Stock;

       "Purchase Price" means with respect to each Bank the purchase price paid
       by such Bank to NTL to purchase the Preferred Stock held by such Bank
       (pursuant to the Purchase Agreement), such Purchase Price to be in the
       amount of US$ 275,000,000 in the case of each of BNP, CAI, DB and West
       LB;

       "Put Acceleration Events" means any of the events or circumstances set
       out in clause 10 Put Acceleration Events;

       "Put Completion Date" has the meaning set forth in clause 3.3;

       "Put Option" means the right of each Bank to require France Telecom to
       acquire all (but not less than all) of the Option Stock it holds as set
       forth in clause 3.1;

       "Put Option Period" means the period during which the Put Option can be
       exercised (within the meaning of clause 1.2.5), being the period
       commencing on the day 20 Business Days before the Termination Date and
       ending on the day which is 8 Business Days before the Termination Date;

       "Reference Banks" means, in relation to LIBOR, the principal London
       offices of National Westminster Bank, plc, Dresdner Bank, AG and Credit
       Lyonnais or such other banks as may be appointed by the Bank
       Representative in consultation with France Telecom;

       "Relevant Margin" means the margin applicable to the calculation of the
       Option Premium in respect of each Premium Period, as more particularly
       set out below:

<TABLE>
<CAPTION>
       -------------------- --------------------------- --------------------------- -----------------------------
         Premium Period       Premium Payment Dates      Last day of the Premium          Relevant Margin
                                                                  Period
       -------------------- --------------------------- --------------------------- -----------------------------
<S>                         <C>                         <C>                         <C>
       First                The Date of Issue           6  months  after  the Date  0.15 per cent per annum
                                                        of Issue

       -------------------- --------------------------- --------------------------- -----------------------------
       Second               6  months  after  the Date  1 year  after  the Date of  0.15 per cent per annum
                            of Issue                    Issue

       -------------------- --------------------------- --------------------------- -----------------------------
       Third                1 year  after  the Date of  18  months  after the Date  0.25 per cent per annum
                            Issue                       of Issue

       -------------------- --------------------------- --------------------------- -----------------------------
       -------------------- --------------------------- --------------------------- -----------------------------
       Fourth               18  months  after the Date  2 years  after the Date of  0.25 per cent per annum
                            of   Issue    (the    last  Issue
                            Premium Payment Date)

       -------------------- --------------------------- --------------------------- -----------------------------
</TABLE>

                                       5

<PAGE>

       "Sale Price" means the price to be paid for the Option Stock held by each
       Bank on the Completion Date as described in clause 5 Sale Price and
       Refund of Option Premium;

       "Subsidiary" means with respect to a company or corporation, any company
       or corporation

       (i)   which is controlled, directly or indirectly, by the first-mentioned
             company or corporation;

       (ii)  more than half the issued share capital of which is beneficially
             owned, directly or indirectly, by the first-mentioned company or
             corporation; or

       (iii) which is a subsidiary of another Subsidiary of the first-mentioned
             company or corporation

       and, for these purposes, a company or corporation shall be treated as
       being controlled by another if that other company or corporation has the
       right or power to direct its affairs and/or has the right to elect a
       majority of its board of directors or any equivalent body or its chief
       executive officer;

       "Tax" means any tax, levy, impost, duty or other charge or withholding of
       a similar nature (including any penalty or interest payable in connection
       with any failure to pay or any delay in paying any of the same);

       "Termination Date"  means the second anniversary of the Date of Issue.

1.2     Interpretation

       1.2.1      The headings used in this Agreement are for convenience only
                  and shall not affect its meaning.

       1.2.2      References to a clause are (unless otherwise stated) to a
                  clause of this Agreement.

       1.2.3      Words importing one gender shall (where appropriate) include
                  any other gender and words importing the singular shall (where
                  appropriate) include the plural and vice versa.

       1.2.4      References to a time in this Agreement are references to the
                  time prevailing in New York City, except with respect to the
                  determination of LIBOR where the time referred to is the time
                  prevailing in London and except with respect to the
                  application of clause 21.2.3 where the time referred to is the
                  time prevailing in Paris.

       1.2.5      Any reference to the "exercise" of the Call Option or of the
                  Put Option shall mean the sending of the notices provided
                  respectively under clauses 4.2, 3.3 or 10.2.

                                       6

<PAGE>

2.     Conditions

2.1    The provisions of this Agreement are conditional upon the Option Stock
       being sold to the Banks in accordance with the terms of the Purchase
       Agreement and issued with the terms set forth in the Certificate of
       Designation as defined in and attached to the Purchase Agreement.

2.2    If the condition described in clause 2.1 is not satisfied on or before
       June 29, 2000 the provisions of this Agreement shall cease to have any
       effect with the exception of the provisions of clauses 11 Indemnity, 14
       Costs and Expenses and 19 Applicable Law and Jurisdiction.

3.     Put Option

3.1    France Telecom hereby grants to each Bank the right to require France
       Telecom to purchase all (but not less than all) of the Option Stock that
       such Bank holds at the Sale Price.

3.2    The Put Option may only be exercised by each Bank:

       (a)    during the Put Option Period; or

       (b)    during any other period in which a Put Acceleration Event has
              occurred and is continuing.

3.3    The Put Option shall be irrevocably exercisable by sending a notice in
       the form attached hereto as Exhibit 3.3 given either by each Bank or by
       the Bank Representative on behalf of all the Banks in writing to France
       Telecom at any time during the Put Option Period or in any period in
       which a Put Acceleration Event has occurred and is continuing. Subject to
       the provisions of clause 15 Possible extension of the Call Option Period
       and of the Put Option Period, if, at the expiry of the Put Option Period,
       the Put Option shall not have been so exercised by a Bank, it shall lapse
       for such Bank. Each notice shall specify the date (the "Put Completion
       Date"), which shall be not less than 8 Business Days from the date of the
       notice and which shall be at the latest on the Termination Date (except
       in case of extension of the Put Option Period as provided in clause
       15.1), for the completion of the sale and purchase of the Option Stock
       concerned by such notice. Each Bank exercising its Put Option shall
       notify such exercise to the Bank Representative and all the other Banks
       without delay.

3.4    Completion of the sale and purchase of any Option Stock concerned by a
       notice received by France Telecom pursuant to clause 3.3 following the
       exercise of the Put Option shall take place on the Put Completion Date at
       the office of the Bank Representative or at such other place as the Bank
       Representative and France Telecom shall agree. At that time the Bank
       Representative (or, in the case where the notice referred to in clause
       3.3 was not sent by the Bank Representative, each Bank having sent such
       notice) shall deliver to France Telecom duly executed stock powers in the
       form of Exhibit 3.4 for the Option Stock concerned by the notice(s) sent
       pursuant to clause 3.3 to effect the transfer of good and marketable
       title to all such Option Stock free and clear of any and all liens and
       encumbrances created by

                                       7

<PAGE>

       the Banks together with all share certificates in respect of the same,
       against payment to each Bank concerned by such notice (as set forth
       therein) of the Sale Price attributed to such Bank in respect of all its
       Option Stock. Completion of the sale and purchase of the Option Stock
       pursuant to clause 4.3 and 10.2 of this Agreement shall be conducted in
       accordance with the provisions of this clause 3.4.

3.5    The rights of each Bank under or in connection with this clause 3 Put
       Option and more generally under or in connection with this Agreement are
       separate and independent rights and any debt arising under this Agreement
       to a Bank from France Telecom shall be a separate and independent debt.

3.6    A Finance Party may, except as otherwise stated in this Agreement,
       separately enforce its rights under this Agreement.

3.7    The obligation of France Telecom to purchase Option Stock from a Bank
       under this clause 3 Put Option and under clause 10.1 shall be conditioned
       upon such Bank not having as of the Put Completion Date relating to such
       Option Stock (i) agreed to amend, modify or terminate, or waived any
       condition or right of such Bank under, the Purchase Agreement, without
       the written consent of France Telecom, or (ii) sold, assigned,
       transferred or created a lien, encumbrance or charge with respect to any
       of its Option Stock or any of its rights thereto which continues to exist
       on the Put Completion Date.

4.     Call Option

4.1    In consideration of the payment of the option fees and of the Option
       Premiums as provided in clause 6 Fees, Option Premium and Default
       Interest, the Banks hereby grant to France Telecom or any Subsidiary of
       France Telecom designated in writing by France Telecom to the Banks in
       the notice given by France Telecom pursuant to clause 4.2 the right
       (exercisable during the Call Option Period) to purchase all (but not some
       only) of the Option Stock at a price equal to the sum of all Sale Prices.

4.2    The Call Option shall be irrevocably exercisable by sending a notice in
       the form attached hereto as Exhibit 3.3 given by France Telecom in
       writing to the Bank Representative at any time during the Call Option
       Period and exclusively for all the Option Stock at the same time. Any
       partial exercise of the Call Option shall be null and void, except as
       permitted under clauses 4.5 and 4.6. If at the expiry of the Call Option
       Period the Call Option shall not have been so exercised it shall lapse.
       The notice shall specify the date (the "Call Completion Date"), which
       shall be not less than 5 Business Days from the date of the notice and
       which shall be at the latest on the Termination Date (except in case of
       extension of the Call Option Period as provided in clause 15.1), for the
       completion of the sale and purchase of the Option Stock.

4.3    Completion of the sale and purchase of the Option Stock following the
       exercise of the Call Option shall take place on the Call Completion Date
       in accordance with the procedures set out in clause 3.4 provided that,
       the duly executed stock powers and the share certificates shall be
       delivered to France Telecom or to

                                       8

<PAGE>

       the Subsidiary of France Telecom designated in writing by France Telecom
       to the Banks as provided in clause 4.1.

4.4    The obligations of each Bank under this clause 4 Call Option and more
       generally under this Agreement are several. Failure by a Bank to perform
       its obligations under this Agreement does not affect the obligations of
       any other party to this Agreement. No Finance Party is responsible for
       the obligations of any other Finance Party under this Agreement.

4.5    Notwithstanding anything to the contrary contained herein, if the Put
       Option is exercised by some but not all of the Banks, France Telecom
       shall have the right to exercise the Call Option hereunder with respect
       to the Option Stock held by the Banks that did not exercise the Put
       Option at a price equal to the sum of Sale Prices with respect to such
       remaining Option Stock.

4.6    Notwithstanding anything to the contrary contained herein, if some but
       not all of the Banks give notice pursuant to clause 3.3 of the exercise
       of their Put Option, the completion of the sale and purchase of the
       Option Stock concerned to take place on a Put Completion Date specified
       in such notice, France Telecom shall have the right to exercise the Call
       Option hereunder with respect to the Option Stock held by the Banks
       having given such notice by giving notice pursuant to clause 4.2 to each
       such Banks (with a copy to the Bank Representative) for a Call Completion
       Date which shall be on or before the Put Completion Date specified in the
       notice given by those Banks having so notified their exercise of the Put
       Option.

5.     Sale Price and Refund of Option Premium

5.1    The Sale Price for the Option Stock held by each Bank shall be equal to
       its Purchase Price.

5.2    If a Put Option or a Call Option is exercised pursuant to this Agreement,
       each Bank concerned by such Put Option or Call Option will on the
       corresponding Completion Date refund to France Telecom (such refund to be
       paid by partial offset of the Sale Price stated in clause 5.1) an amount
       equal to the equivalent in present value (determined in actuarial terms)
       to the Option Premium paid by France Telecom to such Bank on the most
       recent Premium Payment Date, to the extent to which such payment only
       accrued after the Completion Date, such amount to be calculated as
       follows:

       PP x L' x j
       ------------
       360 + L' x j

       where "PP" is Purchase Price, " L' " is the LIBOR minus 0.10 per cent per
       annum plus the Relevant Margin notified by the Bank Representative for
       the period remaining between the corresponding Completion Date and the
       next Premium Payment Date, and "j" is the number of days comprising the
       period for which "L'" is calculated.

       For the avoidance of doubt, such formula also covers any so-called
       "funding breakage costs".

                                       9

<PAGE>

       If a Market Disruption Event occurs and the Bank Representative or France
       Telecom so requires, the Bank Representative and France Telecom shall
       enter into negotiations (for a period of not more than thirty (30) days)
       with a view to agreeing to a substitute basis for determining the rate to
       be used to calculate the refund.

       Any alternative basis agreed pursuant to the preceding paragraph shall,
       with the prior consent of all the Banks and France Telecom, be binding on
       all parties.

6.     Fees, Option Premium and Default Interest

6.1    France Telecom, in respect of the Call Option, shall pay to the Bank
       Representative on behalf of (and for distribution to) the Banks (i) on
       the date of signature of this Agreement an option fee equal to 0.10 per
       cent of the aggregate amount of the Purchase Prices, (ii) on the earlier
       of April 30, 2000 and the Date of Issue an option fee equal to 0.05 per
       cent of the aggregate amount of the Purchase Prices, (iii) on the Date of
       Issue, an additional option fee equal to 0.05 per cent of the aggregate
       amount of the Purchase Prices, and (iv) on the third Premium Payment Date
       if the Call Completion Date has not occurred prior to such date an option
       fee equal to 0.10 per cent of the aggregate amount of the Purchase
       Prices.

6.2    France Telecom shall pay to the Bank Representative on behalf of (and for
       distribution to) the Banks on each Premium Payment Date (for those Banks
       as to which the Completion Date has not occurred prior thereto) an Option
       Premium (calculated in accordance with this clause 6.2) in respect of the
       Call Option.

       6.2.1      The Option Premium payable on any given Premium Payment Date
                  shall be equal to the interest which would accrue on a
                  principal amount equal to the aggregate amount of the Purchase
                  Prices attributable to the Option Stock for which the
                  Completion Date has not occurred in respect of the Premium
                  Period commencing on such Premium Payment Date calculated at
                  the rate per annum determined by the Bank Representative to be
                  the aggregate of (a) the Relevant Margin and (b) Prepaid
                  LIBOR.

       6.2.2      The first Premium Period will commence on the Date of Issue
                  and end on the date falling six months after that date. Each
                  subsequent Premium Period in respect of this Agreement will
                  commence on the last day of the previous Premium Period and
                  shall end on the date falling six months after such date.

       6.2.3      Subject to clause 6.2.4 if LIBOR is to be determined by
                  reference to the Reference Banks but a Reference Bank does not
                  supply a quotation as provided in the definition of LIBOR, the
                  applicable LIBOR shall be determined on the basis of the
                  quotations of the remaining Reference Banks.

       6.2.4      Unless otherwise determined in accordance with clause 6.2.5,
                  if a Market Disruption Event occurs for any Premium Period,
                  then the Option Premium payable to each Bank on the

                                       10

<PAGE>

                  corresponding Premium Payment Date shall be equal to the
                  interest which would accrue on a principal amount equal to
                  the amount of the Purchase Price paid by such Bank in
                  respect of the Premium Period commencing on such Premium
                  Payment Date calculated at the rate per annum determined by
                  the Bank Representative to be the aggregate of (a) the
                  Relevant Margin and (b) the rate equivalent in actuarial
                  terms (as provided in the definition of Prepaid LIBOR) to
                  the rate notified to the Bank Representative by such Bank as
                  soon as practicable and in any event before the Option
                  Premium is due to be paid in respect of the Premium Period,
                  to be that which expresses as a percentage rate per annum
                  the cost to that Bank of funding its Purchase Price from
                  whatever sources it may reasonably select.

       6.2.5      If a Market Disruption Event occurs and the Bank
                  Representative or France Telecom so requires, the Bank
                  Representative and France Telecom shall enter into
                  negotiations (for a period of not more than thirty (30) days)
                  with a view to agreeing to a substitute basis for determining
                  the rate to be used to calculate the Option Premium.

                  Any alternative basis agreed pursuant to the preceding
                  paragraph shall, with the prior consent of all the Banks and
                  France Telecom, be binding on all parties.

       6.2.6      France Telecom shall compensate the Bank Representative (to
                  the extent not otherwise reimbursed under this Agreement) and
                  each Bank upon written request from the Bank Representative
                  (which request shall set forth the basis for such compensation
                  and shall, absent manifest error, bind all parties hereto),
                  for all losses (including loss of reasonably anticipated
                  profits), reasonable expenses and liabilities (including any
                  loss, expense or liability incurred by reason of the
                  liquidation or reemployment of deposits or other funds
                  required by a Bank to fund its Purchase Price) which such Bank
                  sustains:

                  (i)    as a consequence of the occurrence of a Put
                         Acceleration Event as provided in clause 10 Put
                         Acceleration Events; or

                  (ii)   as a consequence of a failure by France Telecom to pay
                         any amount under this Agreement on its due date.

6.3    If either party fails to pay any sum (including any sum payable pursuant
       to this clause 6.3) on its due date for payment under this Agreement,
       such party shall pay interest on such sum at a rate equal to the sum of
       1.25 per cent per annum and of the Overnight Rate calculated on the basis
       of actual days elapsed from the due date up to the date of actual payment
       (as well after as before judgment).

       Default interest under this clause 6.3 shall be due and payable on the
       last day of each such period and at least on the last day of every
       successive three-month period following the due date or, if earlier, on
       the date on which the sum in respect of which such default interest is
       accruing shall actually be paid.

                                       11

<PAGE>

       Default interest (if unpaid) arising on an overdue amount will be
       compounded with the overdue amount at the end of such successive
       three-month period applicable to that overdue amount until actual payment
       but will remain immediately due and payable.

7.     Payments

7.1    Except as provided in clause 5.2, all payments by France Telecom
       hereunder shall be made without set-off or counterclaim and, subject to
       clause 7.2., free and clear of any deductions or withholdings, in Dollars
       in same day funds on the due date to the account of the Bank
       Representative notified to France Telecom by the Bank Representative.

7.2    If at any time France Telecom is required by law to make any deduction or
       withholding in respect of any Taxes from any payment due to any Finance
       Party hereunder, the sum due from France Telecom in respect of such
       payment shall be increased to the extent necessary to ensure that, after
       the making of such deduction or withholding, the Bank Representative
       receives on the relevant due date and retains (free from any liability in
       respect of such deduction or withholding) a net sum equal to the sum
       which it would have received had no such deduction or withholding been
       required to be made. France Telecom shall promptly deliver to the Bank
       Representative receipts, certificates or other proof evidencing the
       amounts (if any) paid or payable in respect of any such deduction or
       withholding.

       France Telecom shall promptly upon becoming aware that it must make a Tax
       deduction or withholding (or that there is any change in the rate or the
       basis of a Tax deduction or withholding) notify the Bank Representative
       accordingly.

       If France Telecom is required to make a Tax deduction or withholding,
       France Telecom shall make such Tax Deduction or withholding within the
       time allowed and in the minimum amount required by law.

       Within 30 days of making either a Tax deduction or withholding or any
       payment required in connection with a Tax deduction or withholding,
       France Telecom shall deliver to the Bank Representative evidence
       reasonably satisfactory to the Bank entitled to the payment that the Tax
       deduction or withholding has been made or (as applicable) any appropriate
       payment paid to the relevant tax authority.

7.3    When any payment would otherwise be due on a day which is not a Business
       Day, the next following Business Day shall be substituted for such day,
       unless such Business Day falls in the next calendar month, in which case
       the immediately preceding Business Day shall be substituted therefor.

7.4    Option Premium, default interest and other sums computed on an annualized
       basis shall accrue from day to day and be calculated on the actual number
       of days elapsed and on the basis of a 360-day year.

                                       12

<PAGE>

7.5    Any certificate or determination of the Bank Representative as to any
       amount payable or required to be calculated hereunder shall be conclusive
       and binding on France Telecom and on the Banks in the absence of manifest
       error.

8.     Undertakings

8.1    France Telecom undertakes with each Bank that:

       8.1.1      it shall inform the Bank Representative of any Put
                  Acceleration Event or any event which with the giving of
                  notice or lapse of time or both would constitute a Put
                  Acceleration Event forthwith upon becoming aware thereof;

       8.1.2      it shall provide the Banks with such financial and other
                  information concerning France Telecom and NTL (to the extent
                  that France Telecom has the right to provide any such
                  information with respect to NTL without violating any
                  confidentiality or fiduciary obligation) and their respective
                  affairs as the Bank Representative may from time to time
                  reasonably require;

       8.1.3      it shall obtain, comply with the terms of and do all that is
                  necessary to maintain in full force and effect all
                  authorizations, approvals, licenses and consents required in
                  or by the laws and regulations of France or of the United
                  States of America or any subdivision thereof, to enable it
                  lawfully to enter into and perform its obligations under this
                  Agreement and the Purchase Agreement or to ensure the
                  legality, validity, enforceability or admissibility in
                  evidence of this Agreement and, to the extent applicable, of
                  the Purchase Agreement;

       8.1.4      it shall ensure that at all times the claims of the Banks
                  against it under this Agreement rank at least pari passu with
                  the claims of all its other unsecured and unsubordinated
                  creditors;

       8.1.5      it shall not, without the prior written consent of the
                  Majority Banks, create or permit to subsist any encumbrance in
                  respect of Borrowed Monies Indebtedness over all or any of its
                  present or future revenues or assets other than:

                  (a)    any lien or right of set-off arising solely by
                         operation of law and not by reason of any default;

                  (b)    subject to clause 8.1.6, any banker's right of set-off
                         or netting against amounts credited to accounts held by
                         any Group member for amounts outstanding or liabilities
                         of itself or any other Group member which is entered
                         into in the ordinary course of business or as a result
                         of normal banking arrangements or any banker's lien
                         created in respect of any such set-off or netting
                         arrangements but excluding arrangements which are
                         established primarily for the purpose of affording a
                         preferential position to the relevant creditor;

                                       13

<PAGE>

                  (c)    any lien incurred in respect of purchase money
                         indebtedness applied for the acquisition of an asset by
                         France Telecom or any Subsidiary of France Telecom;

                  (d)    any lien incurred to finance any development or
                         alteration to any property which is directly owned by
                         France Telecom or any Subsidiary of France Telecom;

                  (e)    any lien attached to any asset of any Subsidiary prior
                         to its acquisition by France Telecom;

                  (f)    any encumbrance not covered by paragraphs (a) to (e)
                         above, provided that the aggregate amount of Borrowed
                         Monies Indebtedness secured by all encumbrances falling
                         within this paragraph (f) does not, at any time, exceed
                         25 per cent of Consolidated Net Worth; or

                  (g)    renewals of any encumbrances referred to in paragraphs
                         (a) to (f) above;

       8.1.6      it shall make sure that its obligations pursuant to this
                  Agreement shall be appropriately reflected in its accounts,
                  including in its audited annual accounts, and if treated
                  off-balance sheet by an appropriate note to the financial
                  statements; and

       8.1.7      it shall duly perform and uphold its undertakings and
                  agreements under the Purchase Agreement.

8.2    Each Bank undertakes with France Telecom that it will not, prior to the
       Completion Date on which the sale of its Option Stock is completed or, if
       later, the Termination Date, at any time sell, assign, transfer, create a
       lien with respect to, encumber, charge, exchange or convert any of its
       Option Stock or any of its rights thereto unless either:

       8.2.1      a Put Acceleration Event has occurred and (i) has not been
                  remedied as per clause 10.1.2 or (ii) France Telecom shall
                  have not performed its obligation to purchase Option Stock
                  upon exercise by any of the Banks of the Put Option; or

       8.2.2      the prior written consent of France Telecom has been obtained.

9.     Representations and Warranties

9.1    France Telecom represents and warrants to each Bank as of the date
       hereof, and will be deemed to represent and warrant to each Bank on each
       Premium Payment Date and on each Completion Date, that:

       9.1.1      France Telecom is duly incorporated and validly existing under
                  the laws of France and has power to execute, deliver and
                  perform its obligations under this Agreement; all necessary
                  action has been taken by it to authorize the execution,
                  delivery and performance of this

                                       14

<PAGE>

                  Agreement, no limitation on its powers will be exceeded as a
                  result of transactions under this Agreement and this Agreement
                  constitutes valid and legally binding obligations of France
                  Telecom enforceable in accordance with its terms;

       9.1.2      the execution, delivery and performance of this Agreement by
                  France Telecom will not contravene any existing law,
                  regulation or authorization to which it is subject, result in
                  any material breach of or default under any agreement or other
                  instrument to which France Telecom is a party or is subject or
                  contravene any provision of France Telecom's corporate
                  documents or to the best knowledge of France Telecom, without
                  having made any specific investigation thereof, result in any
                  material breach of or material default under any agreement or
                  other instrument to which NTL is a party or is subject;

       9.1.3      every authorization of, or registration with, governmental or
                  public bodies or courts required by France Telecom in
                  connection with the execution, delivery, performance,
                  validity, enforceability or admissibility in evidence of this
                  Agreement has been obtained or made and is in full force and
                  effect and there has been no default in the observance of any
                  conditions imposed in connection therewith;

       9.1.4      no event or circumstance which constitutes or which with the
                  giving of notice or lapse of time or both would constitute a
                  Put Acceleration Event has occurred and is continuing;

       9.1.5      under the laws of France in force at the date hereof, it will
                  not be required to make any deduction or withholding from any
                  payment it may make hereunder;

       9.1.6      under the laws of France and of the State of New York in force
                  at the date hereof, the claims of the Banks against France
                  Telecom under this Agreement will rank at least pari passu
                  with the claims of all its other unsecured and unsubordinated
                  creditors, except for claims that may arise by operation of
                  law;

       9.1.7      it irrevocably waives any immunity to jurisdiction which it
                  has or hereafter may acquire (including any immunity,
                  sovereign or otherwise pursuant to public law or status, to
                  pre-judgment attachment and execution) in any legal suit,
                  action or proceeding against it arising out of or based on
                  this Agreement or the transactions contemplated hereby that
                  is instituted in the Supreme Court of the State of New York,
                  County of New York or the U.S. District Court for the
                  Southern District of New York, or in any competent court of
                  the French Republic or any other jurisdiction (whether
                  through service or notice, attachment prior to judgment,
                  attachment in aid of execution, execution or otherwise) with
                  respect to itself or its property. Without limiting the
                  generality of the foregoing, France Telecom agrees that the
                  waivers set forth in this clause 9.1.7 shall have the
                  fullest scope permitted under the Foreign Sovereign
                  Immunities Act of 1976 of the United States and are intended
                  to be irrevocable for purposes of such act;

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<PAGE>

       9.1.8      it has not taken any corporate action nor have any other steps
                  been taken or legal proceedings been started or (to its best
                  knowledge and belief) threatened against it for its
                  winding-up, dissolution (liquidation judiciaire),
                  administration or reorganization (redressement judiciaire) or
                  for the appointment of a receiver, administrator,
                  administrative receiver, trustee or similar officer of it or
                  of any or all of its assets or revenues;

       9.1.9      it is not in breach of or in default under any agreement to
                  which it is a party or which is binding on it or any of its
                  assets to an extent or in a manner which is reasonably likely
                  to have a material adverse effect on its ability to perform
                  its obligations hereunder;

       9.1.10     no action or administrative proceeding of or before any court
                  or agency which is reasonably likely to have a material
                  adverse effect on its ability to perform its obligations
                  hereunder has been started or (to the best of its knowledge
                  and belief) threatened against it;

       9.1.11     all of the written information supplied by it to the Banks in
                  connection herewith is true, complete and accurate in all
                  material respects and it is not aware of any material facts or
                  circumstances that have not been disclosed to the Banks and
                  which might, if disclosed, adversely affect the decision of a
                  person considering whether or not to provide financing to
                  France Telecom or to acquire the Preferred Stock;

       9.1.12     except with respect to encumbrances of the type permitted by
                  clause 8.1.5, to the best knowledge of France Telecom, no
                  encumbrance exists over all or any of its material present or
                  future revenues or assets;

       9.1.13     the execution of this Agreement and of the Purchase Agreement
                  and its exercise of its rights and performance of its
                  obligations hereunder and thereunder will not result in the
                  existence of nor oblige it to create any encumbrance over all
                  or any of its present or future revenues or assets;

       9.1.14     the execution of this Agreement and of the Purchase Agreement
                  constitutes, and its exercise of its rights and performance of
                  its obligations hereunder and thereunder will constitute,
                  private and commercial acts done and performed for private and
                  commercial purposes;

       9.1.15     it has not granted any rights of set-off under or pursuant to
                  the terms of any outstanding credit facilities, bond
                  documentation or note documentation, excluding any notes with
                  a maturity of less than three years, to which it is a party;

       9.1.16     it has made its own investigation and assessment of the
                  creditworthiness and general condition of NTL; it shall be
                  solely responsible for continuing to evaluate the foregoing
                  for its own account and shall not rely on any Finance Party
                  for the furnishing of any assessment, information or
                  commentary whatsoever in respect thereof and it has not relied
                  on any

                                       16

<PAGE>

                  statement or information given by any Finance Party in
                  deciding to enter into this Agreement or the Purchase
                  Agreement; and

       9.1.17     the representations and warranties of France Telecom under the
                  Purchase Agreement with respect to the purchase by France
                  Telecom from the Banks of the Preferred Shares (as such term
                  is defined in the Purchase Agreement) are true and accurate.

9.2    Each Bank represents and warrants to France Telecom as of the date hereof
       and on the Completion Date on which the sale of its Option Stock is
       completed that:

       9.2.1      the Purchase Agreement has not been amended, modified or
                  terminated, and no provision or condition thereof or any right
                  of a Bank thereunder has been waived, without the written
                  consent of France Telecom;

       9.2.2      each Bank is duly incorporated and validly existing under the
                  laws of France or Germany, as the case may be, has on the date
                  hereof and on the Completion Date the full corporate power and
                  authority to make, and has taken all necessary corporate
                  action to authorize the execution, delivery and performance of
                  this Agreement.

10.    Put Acceleration Events

10.1   Each Bank may, and if so instructed by all the Banks, the Bank
       Representative shall, without prejudice to the Banks' other rights
       hereunder, require France Telecom to acquire the Option Stock held by
       such Bank (if requested by one Bank) or all the Option Stock (if
       requested by the Bank Representative) after any of the following events
       shall have occurred and so long as the same is subsisting, provided that
       with respect to any event listed in clause 10.1.2, 10.1.3, 10.1.4,
       10.1.5, 10.1.8, 10.1.9, 10.1.11 and 10.1.14 the Majority Banks shall have
       to decide that such an event has occurred and constitutes a Put
       Acceleration Event prior to any request by any Bank or the Bank
       Representative that France Telecom acquires Option Stock;

       10.1.1     France Telecom fails to pay any sum payable by it under this
                  Agreement in the currency, at the time and in the manner
                  specified in this Agreement unless for sums other than any
                  Sale Price or any Option Premium, such failure to pay is
                  remedied within 10 Business Days of the occurrence thereof; or

       10.1.2     France Telecom defaults in the due performance or observance
                  of any other of its obligations under this Agreement or, as
                  long as it is a party to the Purchase Agreement, under the
                  Purchase Agreement and (if such default is in the opinion of
                  the Majority Banks capable of remedy) such default shall not
                  have been remedied within 10 Business Days following written
                  notice thereof to France Telecom by the Bank Representative;
                  or

                                       17

<PAGE>

       10.1.3     any representation or warranty made or deemed to be made or
                  repeated by France Telecom in or pursuant to this Agreement or
                  in or pursuant to the Purchase Agreement is or proves to have
                  been incorrect or misleading in any material respect; or

       10.1.4     it becomes unlawful for France Telecom to perform any or all
                  its obligations under this Agreement or, as long as it is a
                  party to the Purchase Agreement, under the Purchase Agreement;
                  or

       10.1.5     France Telecom or NTL is unable to pay its debts as they fall
                  due (in the case of France Telecom is in cessation de
                  paiements), commences negotiations with its creditors with a
                  view to the general readjustment or rescheduling of its
                  indebtedness or makes a general assignment for the benefit of
                  or a composition with its creditors; or

       10.1.6     France Telecom or NTL takes any corporate action or other
                  steps are taken or legal proceedings (which proceedings are
                  not discharged within 60 days from the date of their
                  commencement) are started for its redressement judiciaire,
                  liquidation judiciaire, winding-up, dissolution,
                  administration or reorganization in a bankruptcy or insolvency
                  proceeding; or

       10.1.7     France Telecom or NTL takes any corporate action or other
                  steps are taken or legal proceedings are started for the
                  appointment of an administrateur judiciaire, receiver,
                  administrator, administrative receiver, trustee or similar
                  officer of it or of any or all of its revenues and assets; or

       10.1.8     any execution or distress is levied against, or an
                  encumbrancer takes possession of the whole or any material
                  part of, the property, undertaking or assets of France Telecom
                  or NTL; or

       10.1.9     NTL defaults in any material respect in the due performance or
                  observance of any of its obligations under the Purchase
                  Agreement and (if such default is in the opinion of the
                  Majority Banks capable of remedy) such default shall not
                  have been remedied within 10 Business Days following written
                  notice thereof to France Telecom, with a copy thereof sent
                  at the same time to NTL at its address set forth in the
                  Purchase Agreement, or any representation or warranty made
                  or deemed to be made or repeated by NTL in or pursuant to
                  Section 1 of the Purchase Agreement is or proves to have
                  been incorrect or misleading in any material respect; or

       10.1.10    France Telecom repudiates this Agreement; or

       10.1.11    at any time any act, condition or thing required to be done,
                  fulfilled or performed in order (a) to enable France Telecom
                  lawfully to enter into, exercise its rights under and
                  perform the obligations expressed to be assumed by it in
                  this Agreement or under the Purchase Agreement, (b) to
                  ensure that the obligations expressed to be assumed by
                  France Telecom in this Agreement or in the Purchase
                  Agreement are legal, valid and binding or (c) to make this

                                       18

<PAGE>

                  Agreement or the Purchase Agreement admissible in evidence
                  in the city of New York and in France is not done, fulfilled
                  or performed and any such act, condition or thing is, in the
                  opinion of the Majority Banks, material; or

       10.1.12    Standard and Poors reduces its credit rating of France
                  Telecom's long-term debt below A - or Moody's reduces its
                  credit rating of France Telecom's long-term debt below Aa3; or

       10.1.13    it becomes unlawful in any jurisdiction for a Bank to perform
                  any of its obligations as contemplated by this Agreement or
                  the Purchase Agreement or to hold Preferred Stock, in which
                  case the Put Acceleration Event shall be deemed to occur
                  solely with respect to such Bank; or

       10.1.14    any company or person or a group of persons and/or of
                  companies acting in concert, other than France Telecom,
                  acquires control directly or indirectly of NTL, within the
                  meaning of the term "control" as set forth in the definition
                  of Subsidiary or France Telecom and/or any Subsidiary thereof
                  shall no longer be the registered and beneficial owner of
                  capital stock of NTL representing at least 2 per cent of the
                  voting rights of all outstanding NTL capital stock; or

       10.1.15    companies of the Group, on a consolidated basis (including
                  France Telecom), or France Telecom on an individual basis
                  sell, lease, transfer or otherwise dispose of (including by
                  discontinuation), by one or more transactions or series of
                  transactions (whether related or not), the whole or any
                  substantial part (the book value of which is, (i) in the
                  case of companies of the Group on a consolidated basis, when
                  aggregated with the book value of the Group's revenues or,
                  as the case may be, the Group's assets which have been sold,
                  leased, transferred or otherwise disposed of during any
                  twelve month period following the date of this Agreement, 20
                  per cent or more of the book value of the whole, determined
                  by reference to France Telecom's latest consolidated
                  financial statements delivered by France Telecom pursuant to
                  clause 8.1.2 and (ii) in the case of France Telecom on an
                  individual basis when aggregated with the book value of its
                  revenues or, as the case may be, assets which have been
                  sold, leased, transferred or otherwise disposed of during
                  any twelve month period following the date of this
                  Agreement, 20 per cent or more of the book value of the
                  whole, determined by reference to France Telecom's latest
                  statutory audited financial statements delivered by France
                  Telecom pursuant to clause 8.1.2) of the Group's revenues or
                  assets in the case of companies of the Group on a
                  consolidated basis or of France Telecom's revenues or assets
                  in the case of France Telecom on an individual basis, other
                  than:

                  (a)    disposals of stock in trade in the ordinary course of
                         business;

                  (b)    disposals on arm's length commercial terms, for full
                         value and for cash consideration;

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<PAGE>

                  (c)    in the case of companies of the Group other than France
                         Telecom, disposals to another member of the Group;

                  (d)    disposals required by law, regulation, governmental
                         order or governmental authority; or

                  (e)    disposals, the proceeds of which are to be reinvested
                         in the Group in the case of companies of the Group
                         other than France Telecom or used to repay any Borrowed
                         Monies Indebtedness within six months.

10.2   The rights conferred upon the Banks and the Bank Representative pursuant
       to clause 10.1 may be exercised even if the Put Option Period has not
       then begun. If France Telecom is required to purchase all or part of the
       Option Stock pursuant to clause 10.1, then completion of the transaction
       shall take place pursuant to the notice given to France Telecom in
       accordance with clause 3.3 or 4.2 and in accordance with the provisions
       of clause 3.4.

11.    Indemnity

11.1   Notwithstanding anything to the contrary in this Agreement or any other
       agreement referred to in this Agreement including the Purchase Agreement,
       France Telecom agrees to indemnify and hold harmless each of the Finance
       Parties and each director, officer, employee and affiliate thereof (each
       an "indemnified person") from and against any and all actions, suits,
       proceedings (including any investigations or inquiries), claims, losses,
       damages, liabilities or expenses of any kind or nature whatsoever which
       may be incurred by or asserted against or involve any such indemnified
       person as a result of or arising out of or in any way related to or
       resulting from this Agreement, from the Purchase Agreement or from
       holding Preferred Stock, and France Telecom agrees to reimburse each
       indemnified person for any reasonable and documented legal or other
       out-of-pocket expenses incurred in connection with investigating,
       defending or preparing to defend any such action, suit, proceeding
       (including any inquiry or investigation) or claim (whether or not any
       such indemnified person is a party to any action or proceeding out of
       which any such expenses arise); provided that France Telecom shall not
       have to indemnify any indemnified person against loss, claim, damage,
       expense or liability to the extent that the same resulted primarily from
       the gross negligence or willful misconduct of such indemnified person.
       Promptly after receipt by an indemnified person of notice of the
       commencement of any action, suit or proceeding, or existence of a claim,
       such indemnified person shall give written notice to France Telecom with
       respect thereto. At France Telecom's request, the Banks and their counsel
       shall cooperate and consult with France Telecom and the counsel appointed
       at France Telecom's cost by France Telecom. The Banks shall provide
       France Telecom with all information or documents in relation to any such
       action, suit, proceeding or claim which France Telecom may reasonably
       request. In the event of a disagreement on the strategy to be implemented
       with regard to any such action, suit, proceeding or claim or if France
       Telecom chooses not to intervene in the defense of the indemnified
       person, the indemnified person will keep ultimate management of its
       defense for its own benefit.

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<PAGE>

11.2   (a)    France Telecom shall (within 5 Business Days of demand by
              the Bank Representative) pay to a Protected Party an amount equal
              to the loss, liability or cost which that Protected Party
              determines will be or has been (directly or indirectly) suffered
              for or on account of Tax by that Protected Party.

       (b)    Paragraph (a) above shall not apply with respect to any Tax
              assessed on a Finance Party:

               (A)   under the law of the jurisdiction in which that Finance
                     Party is incorporated or, if different, the jurisdiction
                     (or jurisdictions) in which that Finance Party is treated
                     as resident for tax purposes; or

               (B)   under the law of the jurisdiction in which that Finance
                     Party's office through which that Finance Party will
                     perform its obligations under this Agreement and the
                     Purchase Agreement is located in respect of amounts
                     received or receivable in that jurisdiction,

              if that Tax is imposed on or calculated by reference to the net
              income received or receivable (but not any sum deemed to be
              received or receivable) by that Finance Party other than a
              dividend in kind in relation to the Preferred Stock;

       (c)    A Protected Party making or intending to make a claim pursuant to
              paragraph (a) above shall promptly notify the Bank Representative
              of the event which will give, or has given, rise to the claims,
              following which the Bank Representative shall notify France
              Telecom;

       (d)    A Protected Party shall, on receiving payment from France Telecom
              under this clause 11.2, notify the Bank Representative.

11.3   (a)    All consideration payable under this Agreement by France
              Telecom to a Finance Party shall be deemed to be exclusive
              of any value added tax (VAT). If VAT is chargeable, France Telecom
              shall pay to the Finance Party (in addition to and at the same
              time as paying the consideration) an amount equal to the amount of
              the VAT.

       (b)    Where this Agreement requires France Telecom to reimburse a
              Finance Party for any costs or expenses, France Telecom shall also
              at the same time pay and indemnify that Finance Party against all
              VAT incurred by that Finance Party in respect of the costs or
              expenses save to the extent that that Finance Party is entitled to
              repayment or credit in respect of the VAT.

11.4    France Telecom shall promptly indemnify the Bank Representative (acting
        on behalf and for distribution to the Banks) for any cost relating to
        any stamp, transfer, sales and use, value added, documentary,
        registration, issuance or similar tax, assessment or other governmental
        charge imposed on the sale or delivery of the Preferred Stock pursuant
        to the Purchase Agreement, on the sale or delivery of the Option Stock
        pursuant to this Agreement, or upon the execution, delivery or
        performance of the Purchase Agreement and this Agreement.

                                       21

<PAGE>

11.5    France Telecom shall promptly indemnify the Bank Representative against
        any cost, loss or liability incurred by the Bank Representative (acting
        reasonably) as a result of:

       (a)    investigating any event which it reasonably believes is a Put
              Acceleration Event; or

       (b)    acting or relying on any notice, request or instruction which it
              reasonably believes to be genuine, correct and appropriately
              authorized.

  11.6   If any sum due from France Telecom under this Agreement (a "Sum"), or
         any order, judgment or award given or made in relation to a Sum, has to
         be converted from the currency (the "First Currency") in which that Sum
         is payable into another currency (the "Second Currency") for the
         purpose of:

         (i)  making or filing a claim or proof against France Telecom; or

         (ii) obtaining or enforcing an order, judgment or award in relation to
              any litigation or arbitration proceedings,

         France Telecom shall, as an independent obligation, within 5 Business
         Days of demand, indemnify each Finance Party to whom that Sum is due
         against any cost, loss or liability arising out of or as a result of
         the conversion including any discrepancy between (A) the rate of
         exchange used to calculate the conversion of that Sum from the First
         Currency into the Second Currency and (B) the market rate or rates of
         exchange actually available to such Finance Party at the time of its
         receipt of that Sum.

         France Telecom waives any right it may have in any jurisdiction to pay
         any amount under this Agreement in a currency or currency unit other
         than that in which it is expressed to be payable.

11.7   In the event any Finance Party receives, as a result of judgment,
       settlement, indemnification or otherwise, any amounts that in the
       aggregate exceed the amount of damages, costs or expenses actually
       suffered or incurred by such Finance Party and with respect to which such
       Finance Party has received reimbursement, indemnification or other
       payment from France Telecom pursuant to this Agreement, such Finance
       Party shall promptly pay to France Telecom the amount equal to the excess
       of the aggregate amounts received by such Finance Party with respect to
       such damages, costs or expenses over the amounts of damages, costs or
       expenses actually suffered or incurred by such Finance Party.

12.    Increased costs

12.1   (a)    Subject to clause 12.3, France Telecom shall, within five Business
              Days of a demand by the Bank Representative, pay for the account
              of a Finance Party the amount of any Increased Costs incurred by
              that Finance Party as a result of (i) the introduction of or any
              change in (or in the interpretation or application of) any law or
              regulation or (ii) compliance with any law or regulation made
              after the date of this Agreement.

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<PAGE>

       (b)    In this Agreement "Increased Costs" means:

               (i)   a reduction in the return on or calculated by reference to
                     any amount received or receivable by a Finance Party under
                     this Agreement or a reduction in the rate of return on a
                     Finance Party's overall capital;

               (ii)  an additional or increased cost; or

               (iii) a reduction of any amount due and payable under this
                     Agreement,

              which is incurred or suffered by a Finance Party to the extent
              that it is attributable to that Finance Party having entered into
              this Agreement or the Purchase Agreement or performing its
              obligations under this Agreement or the Purchase Agreement.

12.2   (a)    A Finance Party intending to make a claim pursuant to
              clause 12.1 shall notify the Bank Representative of the event
              giving rise to the claim, following which the Bank Representative
              shall promptly notify France Telecom.

       (b)    Each Finance Party shall, as soon as practicable after a demand by
              the Bank Representative, provide a certificate confirming the
              amount of its Increased Costs.

12.3   Clause 12.1 does not apply to the extent any Increased Cost is

       (i)    attributable to a Tax deduction required by law to be made by
              France Telecom;

       (ii)   otherwise compensated for pursuant to this Agreement, including
              under clause 11.2 (or would have been compensated for under clause
              11.2 but was not so compensated solely because one of the
              exclusions in paragraph (b) of clause 11.2 applied); or

       (iii)  attributable to gross negligence of the relevant Finance Party or
              to the willful breach by the relevant Finance Party of any law or
              regulation or of this Agreement or the Purchase Agreement.

13.    Mitigation by the Finance Parties

13.1   (a)    Each Finance Party shall, in consultation with France
              Telecom (such consultation to extend to the analysis of all
              possible steps to be taken reasonably by each Finance Party), take
              all reasonable steps to mitigate any circumstances which arise and
              which would result in any amount becoming payable under any of
              clause 7.2, clause 11 Indemnity, clause 12 Increased Costs or
              clause 15 Possible Extension of the Call Option Period and of the
              Put Option Period.

       (b)    Paragraph (a) above does not in any way limit the obligations of
              France Telecom under this Agreement.

                                       23

<PAGE>

13.2   (a)    France Telecom shall indemnify each Finance Party for all
              costs and expenses reasonably incurred by that Finance Party as a
              result of steps taken by it under clause 13.1.

       (b)    A Finance Party is not obliged to take any steps under clause 13.1
              if, in the opinion of that Finance Party (acting reasonably), to
              do so would be detrimental to it.

14.    Costs and Expenses

14.1   France Telecom shall promptly on demand pay the Banks the amount of all
       reasonable fees and disbursements of one law firm incurred by them in
       connection with the negotiation, preparation and execution of this
       Agreement and any other documents referred to in this Agreement
       (including the Purchase Agreement).

14.2   If France Telecom requests an amendment, waiver or consent, France
       Telecom shall, within 10 Business Days of demand, reimburse the Bank
       Representative for the amount of all reasonable fees and disbursements of
       one law firm incurred by the Bank Representative and the Banks in
       responding to, evaluating, negotiating or complying with that request or
       requirement.

14.3   France Telecom shall, within 10 Business Days of demand, pay to each
       Finance Party the amount of all costs and expenses (including fees and
       disbursements of one law firm in France and of one law firm in the United
       States of America for all Finance Parties) incurred by that Finance Party
       in connection with the enforcement of, or the preservation of any rights
       under, this Agreement and any other documents referred to in this
       Agreement including the Purchase Agreement.

15.    Possible Extension of the Call Option Period and of the Put Option Period

15.1   To the extent that on the last day of the Call Option Period or of the
       Put Option Period any law, regulation or judicial decision prohibits or
       otherwise renders impossible the transfer of all or part of the Option
       Stock from any or all Banks to France Telecom, the duration of the Call
       Option Period and of the Put Option Period shall be extended until 20
       Business Days following the date on which each Finance Party and France
       Telecom has been notified that such prohibition or impossibility is
       terminated (whether or not such date is after the Termination Date),
       subject to the following conditions:

       (a)    if the transfer of all or part of the Option Stock from the Banks
              to France Telecom is prohibited by a decision of a tribunal at the
              request of a person who is either France Telecom or an Affiliate
              thereof, the duration of the Call Option Period shall not be
              extended unless such judicial decision determines on the merits
              that France Telecom is prohibited by a newly enacted law or
              regulation from acquiring the Option Stock from the Banks under
              this Agreement;

       (b)    as long as the period during which the Put Option Period and/or
              the Call Option Period is extended hereunder, France Telecom
              agrees to use all reasonable efforts to cause NTL to (i) fully
              cooperate

                                       24

<PAGE>

              and ensure that the reasons for such extension disappear as soon
              as possible, and (ii) assist as much as possible the other
              parties hereto in the elaboration of any action taken to reach
              such result;

15.2   It is only after a final court decision, not subject to appeal, has ruled
       that the circumstances which have led to the extension of the Call Option
       Period and/or of the Put Option Period cannot be lifted, that each Bank
       will be entitled to request France Telecom to pay to such Bank the Sale
       Price of such Bank as if the transfer of the Option Stock could occur and
       France Telecom will have to pay such Sale Price within 5 Business Days
       from such request; in such circumstances after such payment and as long
       as France Telecom cannot become the holder of the Option Stock (i) each
       Bank shall use its best efforts to transfer the Option Stock to France
       Telecom as soon as possible, (ii) each Bank shall ensure that all income
       (net of any Tax bearing on such Bank in respect thereof) received by such
       Bank in relation with the Option Stock be transferred to France Telecom
       as soon as possible after receipt and (iii) to the maximum extent
       possible without suffering a prejudice therefrom, each Bank will utilize
       its best efforts, in good faith, to accept any possible alternate
       solution to the payment of the Sale Price.

15.3   As long as the Call Option Period and/or the Put Option Period are
       extended beyond the Termination Date as provided in clause 15.1 and
       unless the Sale Price has been paid in accordance with the provisions of
       clause 15.2, for the first time on the Termination Date, then on the date
       which is falling six months after the Termination Date and thereafter on
       each date which is falling six months after the preceding date on which
       such a payment is made, France Telecom shall pay to each Bank a premium
       calculated like the Option Premium except that the Relevant Margin shall
       be equal to 0.50 per cent per annum.

15.4   As long as the Call Option Period and/or the Put Option Period are
       extended beyond the Termination Date as provided in clause 15.1, to the
       extent the Banks receive (or are deemed to receive for tax purposes) any
       income in relation with the Preferred Stock and have to pay Taxes in
       connection therewith, without limiting the generality of the provisions
       of clauses 7.2 and 11.2, France Telecom shall (within 5 Business Days of
       demand by the Bank Representative) pay to such Banks an amount sufficient
       to ensure that, after the making of such payment, such Banks are fully
       indemnified for any such Taxes including any Tax on any amount so
       received pursuant to this clause 15.4.

15.5   As long as the Call Option Period and/or the Put Option Period are
       extended beyond the Termination Date, and more generally any time a
       substantive provision of this Agreement cannot be applied in accordance
       with its terms, the parties to this Agreement agree to meet in good faith
       to try to find any possible alternative solution which will allow the
       parties to this Agreement to maintain generally the economic equilibrium
       of this Agreement and achieve their original intentions when entering
       into this Agreement, provided that nothing in this clause 15.5 shall
       entail that, in order to achieve such objective, any Bank shall have to
       suffer a prejudice or take any action which it considers, in good faith,
       to be detrimental to it.

                                       25

<PAGE>

15.6   Except as provided in clauses 15.1 through 15.5, all the provisions of
       this Agreement will remain unchanged as long as the Call Option Period
       and/or the Put Option Period are extended as provided in clause 15.1.

16.    Assignments and Transfers

16.1   This Agreement shall be binding upon and enure to the benefit of the
       parties hereto and their respective successors.

16.2   None of the parties hereto may assign or transfer any of its rights or
       obligations under this Agreement without, in the case of France Telecom,
       having obtained the prior written consent of the Bank Representative on
       behalf of the Banks and, in the case of any Finance Party, the prior
       written consent of France Telecom which, in the case of an assignment or
       transfer to any such Finance Party's Affiliate, shall not be refused
       without reasonable justification.

17.    Bank Representative

17.1   Each Bank hereby appoints the Bank Representative to act as its agent in
       connection herewith and authorises the Bank Representative to exercise
       such rights, powers and discretions as are specifically delegated to the
       Bank Representative by the terms hereof together with all such rights,
       powers and discretions as are reasonably incidental thereto (it being
       declared, for the avoidance of doubt, that the Bank Representative shall
       have no authority to commence legal proceedings against France Telecom on
       behalf of any Bank without the prior written consent of such Bank).

17.2   The Bank Representative may:

       (i)    assume that none of those events mentioned in clause 10 Put
              Acceleration Events has occurred and that France Telecom is not in
              breach of its obligations hereunder unless it has actual knowledge
              or actual notice to the contrary;

       (ii)   engage and pay for the advice or services of any lawyers,
              accountants, surveyors or other experts whose advice or services
              may to it seem reasonably necessary, expedient or desirable and
              rely upon any advice so obtained;

       (iii)  rely as to any matters of fact which might reasonably be expected
              to be within the knowledge of France Telecom upon a certificate
              signed by or on behalf of France Telecom;

       (iv)   rely on any communication or document believed by it to be
              genuine;

       (v)    refrain from exercising any right, power or discretion vested in
              it hereunder unless and until instructed by the Majority Banks as
              to whether or not such right, power or discretion is to be
              exercised and, if it is to be exercised, as to the manner in which
              it should be exercised; and

                                       26

<PAGE>

       (vi)   refrain from acting in accordance with any instructions of the
              Majority Banks to begin any legal action or proceeding arising out
              of or in connection with this Agreement until it shall have
              received such security as it may require (whether by way of
              payment in advance or otherwise) for all costs, claims, expenses
              (including legal fees) and liabilities which it will or may expend
              or incur in complying with such instructions.

17.3   The Bank Representative shall:

       (i)    promptly inform each Bank of the contents of any notice or
              document received by it from France Telecom hereunder;

       (ii)   promptly notify each Bank of the occurrence of any of those events
              mentioned in clause 10 Put Acceleration Events or any default by
              France Telecom in the due performance of its obligations under
              this Agreement of which the Bank Representative has actual
              knowledge or actual notice;

       (iii)  subject to the foregoing provisions of this clause, act in
              accordance with any instructions given to it by the Majority
              Banks; and

       (iv)   if so instructed by the Majority Banks, refrain from exercising a
              right, power or discretion vested in it hereunder.

17.4   Notwithstanding anything to the contrary expressed or implied herein, the
       Bank Representative shall not:

       (i)    be bound to enquire as to the occurrence or otherwise of any
              of those events mentioned in clause 10 Put Acceleration Events or
              as to the performance or otherwise by France Telecom of its
              obligations hereunder;

       (ii)   be bound to account to any Bank for any sum or the profit element
              of any sum received by it for its own account;

       (iii)  be bound to disclose to any other person any information relating
              to France Telecom if such disclosure would or might in its opinion
              constitute a breach of any law or regulation or be otherwise
              actionable at the suit of any person; or

       (iv)   be under any obligation other than those for which express
              provision is made herein.

17.5   Subject to the appointment and acceptance of a successor Bank
       Representative as provided below, the Bank Representative may at any time
       and upon not less than 60 (sixty) days' notice from the Majority Banks
       shall resign as Bank Representative by giving written notice to the Banks
       and France Telecom. Upon any such resignation, the Majority Banks shall
       have the right to appoint a successor Bank Representative acceptable to
       France Telecom. If no successor Bank Representative shall have been so
       appointed by the Majority Banks and shall have accepted such appointment
       within thirty days after the

                                       27

<PAGE>

       retiring Bank Representative gave notice of resignation, the retiring
       Bank Representative may on behalf of the Banks, appoint a successor
       Bank Representative, which shall be a Bank or a bank which is a
       subsidiary or a parent company of a Bank. Upon the acceptance of any
       appointment as Bank Representative by a successor Bank Representative,
       such successor Bank Representative shall thereupon succeed to and
       become vested with all the rights, powers, privileges and duties of
       the retiring Bank Representative, and the retiring Bank Representative
       shall be discharged from its duties and obligations hereunder as Bank
       Representative. The provisions of this clause 17.5 shall continue in
       effect for the benefit of the retiring Bank Representative in respect
       of any actions taken or omitted to be taken by it while it was acting
       as the Bank Representative.

17.6   The Bank Representative shall be indemnified by each Bank against any and
       all costs, claims, expenses (including but not limited to legal fees) and
       liabilities which the Bank Representative may incur in complying with any
       instructions received by it from the Majority Banks in the proportion
       which the Purchase Price of such Bank bears to the aggregate amount of
       all Purchase Prices, provided no Bank shall have any obligation under
       this clause 17.6 to indemnify the Bank Representative against any such
       costs, claims, expenses and liabilities incurred by the Bank
       Representative in the course of any legal proceedings taken against
       France Telecom without the prior written consent of such Bank.

17.7   The Bank Representative does not accept any responsibility for the
       accuracy and/or completeness of any information supplied to any Bank in
       connection with the transactions contemplated by this Agreement or the
       Purchase Agreement or for the legality, validity, effectiveness, adequacy
       or enforceability of this Agreement or the Purchase Agreement and the
       Bank Representative shall not be under any liability as a result of
       taking or omitting to take any action in relation to this Agreement save
       in the case of gross negligence or wilful misconduct.

17.8   Each Bank agrees that it will not assert or seek to assert against any
       director, officer or employee of the Bank Representative any claim it
       might have in respect of the matters referred to in clause 17.7.

17.9   The Bank Representative may accept deposits from, lend money to and
       generally engage in any kind of banking, trust or other business with
       France Telecom.

17.10  It is understood and agreed by each Bank that it has itself been, and
       will continue to be, solely responsible for making its own independent
       appraisal of and investigation into the financial condition,
       creditworthiness, affairs, status and nature of France Telecom and NTL
       and accordingly each Bank confirms to the Bank Representative that it has
       not relied, and will not hereafter rely, on the Bank Representative:

       (i)    to check or inquire on its behalf into the adequacy, accuracy
              or completeness of any information provided by France Telecom and
              NTL in connection with this Agreement or the Purchase Agreement or
              the transactions therein contemplated (whether or not such
              information has been or is hereafter circulated to such Bank by
              the Bank Representative); or

                                       28

<PAGE>

       (ii)   to assess or keep under review on its behalf the financial
              condition, creditworthiness, affairs, status or nature of France
              Telecom and NTL.

18.    Accession of New Banks

To the extent that prior to the Date of Issue France Telecom substitutes to
itself, in whole or in part, one or more banks to acquire Preferred Stock under
the Purchase Agreement, any such bank (an "Additional Bank") shall become party
to this Agreement and shall be allowed to participate in the arrangements
contemplated by this Agreement, in which case, upon and with effect from
delivery to the Bank Representative by such Additional Bank and France Telecom
of an Accession Notice in the form attached as Exhibit 18, such Additional Bank
shall be treated as a Bank as if it had been named as such at the beginning of
this Agreement, provided that such Additional Bank is a first rank bank
established in Paris, with a rating of its long-term debt by Standard & Poors of
at least "A" unless the prior written approval of the Majority Banks has been
obtained, such approval not to be unreasonably withheld.

19.    Applicable Law and Jurisdiction

19.1   This Agreement and the rights and obligations of the parties shall be
       governed by and construed in accordance with the law of the State of New
       York, United States of America.

19.2   Each of the Finance Parties and France Telecom irrevocably agrees that
       any legal suit, action or proceeding against it arising out of or in
       connection with this Agreement, the Preferred Stock or the Option Stock,
       as the case may be, may be instituted in the Supreme Court of the State
       of New York, County of New York or the U.S. District Court for the
       Southern District of New York, as applicable, and irrevocably waives any
       objection which it may now or hereinafter have to the laying of venue of
       any such proceeding, and irrevocably submits to the non-exclusive
       jurisdiction of such courts in any such suit, action or proceeding.

20.    Entire Agreement

       This Agreement constitutes the entire and only legally binding agreement
       between the parties relating to its subject matter and no amendment or
       modification of this Agreement shall be effective unless made in writing
       signed by or on behalf of all the parties and expressed to be such an
       amendment or modification.

21.    Notices

21.1   Any notice shall be in writing and signed by or on behalf of the person
       giving it. Except in the case of personal service, any notice shall be
       sent or delivered to the party to be served at the address given below or
       in the Accession Notice in the case of an Additional Bank. Any alteration
       in such details shall, to have effect, be notified to the other parties
       in accordance with this clause.

21.2   Service of a notice must be effected by one of the following methods:

                                       29

<PAGE>

       21.2.1     personally on an authorized representative of France Telecom
                  or a Bank or the Bank Representative, as the case may be, in
                  which case notice shall be treated as served at the time of
                  such service;

       21.2.2     by prepaid first class mail (or by airmail if from one country
                  to another) to the address of France Telecom, a Bank or the
                  Bank Representative, as the case may be, and shall be treated
                  as served on the second (or if by airmail the fourth) Business
                  Day after the date of posting. In proving service it shall be
                  sufficient to prove that the envelope containing the notice
                  was correctly addressed, postage paid and posted; or

       21.2.3     by facsimile to France Telecom, a Bank or the Bank
                  Representative, as the case may be, in which case notice shall
                  be treated as served at the expiration of 2 hours after the
                  time of dispatch, if dispatched before 3.00 p.m. on any
                  Business Day and, in any other case, at 10.00 a.m. on the
                  Business Day following the date of dispatch, but in any event
                  only if a confirmation of the receipt by the recipient of the
                  facsimile appears correctly on the sender's facsimile
                  transmission report.

                                       30

<PAGE>

21.3 The relevant address and facsimile numbers of the parties are as follows:

<TABLE>
<CAPTION>
       ----------------------------- ------------------------- -------------------------- ------------------------
       Party                         Attention                 Facsimile number           Address

       ----------------------------- ------------------------- -------------------------- ------------------------
       <S>                           <C>                       <C>                        <C>
        the Bank Representative      Damien Scaillierez        (33-1) 41-89-39-53         Credit Agricole
                                                                                          Indosuez
                                                                                          9, Quai du President
                                                                                          Paul Doumer
                                                                                          92400 Courbevoie,
                                                                                          France

       ----------------------------- ------------------------- -------------------------- ------------------------
        Banque Nationale de Paris    Philippe Roca             (33-1) 40-14-69-40         Financements Structures
                                                                                          20, Boulevard des
                                                                                          Italiens
                                                                                          75009 Paris, France

       ----------------------------- ------------------------- -------------------------- ------------------------
        Credit Agricole Indosuez     Damien Scaillierez        (33-1) 41-89-39-53         Credit Agricole
                                                                                          Indosuez
                                                                                          9, Quai du President
                                                                                          Paul Doumer
                                                                                          92400 Courbevoie,
                                                                                          France

       ----------------------------- ------------------------- -------------------------- ------------------------
        Deutsche Bank AG             Benoit Deschamps          (33-1) 42-89-00-45         3, Avenue de Friedland
        Paris Branch                                                                      75008 Paris, France

       ----------------------------- ------------------------- -------------------------- ------------------------
        Westdeutsche Landesbank      Khaled Osman              (33-1) 45-63-15-71         15, Avenue de Friedland
        Girozentrale                                                                      75008 Paris, France
        Paris Branch

       ----------------------------- ------------------------- -------------------------- ------------------------
        France Telecom               Philip McAllister         (33-1)                     212, rue Raymond
                                                               44-44-86-00                Losserand
                                                                                          75014 Paris,
                                                                                          France

       ----------------------------- ------------------------- -------------------------- ------------------------
        with a copy to:

        Shearman & Sterling          Alfred J. Ross, Jr.       (212) 848-7179             599 Lexington Avenue
                                                                                          New York, NY
                                                                                          10022, U.S.A.

       ----------------------------- ------------------------- -------------------------- ------------------------
</TABLE>

22.    Remedies and Waivers

       No failure to exercise, nor any delay in exercising, on the part of any
       Finance Party, any right or remedy under this Agreement shall operate as
       a waiver, nor shall any single or partial exercise of any right or remedy
       prevent any further or other exercise of any other right or remedy. The
       rights and remedies provided in this Agreement are cumulative and not
       exclusive of any rights or remedies provided by law.

                                       31

<PAGE>

  THIS AGREEMENT has been duly executed on the date stated above.

  BANQUE NATIONALE DE PARIS

  By: /s/ Lionel Bordarier                   By: /s/ Christophe Delafontaine
     --------------------------                 --------------------------------
     Title : Directeur                          Title : Directeur Adjoint

  CREDIT AGRICOLE INDOSUEZ

  By: /s/ Michel Chabanel                    By: /s/ Damien Scaillierez
     --------------------------                 --------------------------------
     Title : Head of Acquisition                Title : Fonde de Pouvoir
             Finance

  DEUTSCHE BANK AG
  PARIS BRANCH

  By: /s/ Benoit Deschamps                   By: /s/ Antoine de Maistre
     --------------------------                 --------------------------------
     Title : Directeur                          Title :

  WESTDEUTSCHE LANDESBANK GIROZENTRALE
  PARIS BRANCH

  By: /s/ Barbara Selves                     By: /s/ Nadine Veldung
     --------------------------                 --------------------------------
     Title : Directeur                          Title : Directeur

  FRANCE TELECOM

  By: /s/ Eric Bouvier                       By:
     --------------------------                 --------------------------------
     Title : Head of the Mergers                Title :
             & Acquisitions Department

  CREDIT AGRICOLE INDOSUEZ,
     as Bank Representative

  By: /s/ Michel Chabanel                    By: /s/ Damien Scaillierez
     --------------------------                 --------------------------------
     Title : Head of Acquisition                Title : Fonde de Pouvoir
             Finance

                                       32

<PAGE>

                                                                     EXHIBIT 3.3

                                     NOTICE

       [To be delivered for purposes of exercising the Put or Call Option]

To: [______](1)

         Reference is hereby made to the Put and Call Option Agreement dated
February 17, 2000, among Banque Nationale de Paris, Credit Agricole Indosuez,
Deutsche Bank AG Paris Branch, Westdeutsche Landesbank Girozentrale Paris Branch
and France Telecom [as amended](2). The undersigned hereby gives notice pursuant
to clause [___](3) of the Put and Call Option Agreement that it irrevocably
exercises its rights under the Put and Call Option Agreement (Put Option/Call
Option)(4) to [sell/purchase](4) [___] shares of 5% Cumulative Preferred Stock,
Series A of NTL Incorporated, with a Completion Date for delivering the shares
and the amount payable with respect thereto under the Put and Call Option
Agreement to be on [___], 200[___].(5)

         Payment of the Purchase Price (being US $ _____________) shall be made
in same day funds to the undersigned at [insert payment instructions].

         [In case of exercise of the Call Option, if applicable indicate the
name of the Subsidiary of France Telecom to receive and pay for the Option Stock
and relevant instructions.]

         Dated:  [_____________]

                                        [ENTITY NAME]

                                        By: ___________________
                                            Name:
                                            Title:

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

1        If notice is given by a Bank or the Bank Representative of its
exercise of the Put Option, notice should be given to France Telecom. If notice
is given by France Telecom of its exercise of the Call Option, notice should be
given to the Bank Representative and in connection with clause 4.6 to each Bank
concerned.

2        Delete if not necessary.

3        Refer to appropriate clause: clause 3.3 or 10.2 with respect to the
Put Option; 4.2 with respect to the Call Option.

4        Delete inapplicable references.

5        Specify a Completion Date which is not less than 5 Business Days (for
the Call Option) or 8 Business Days (for the Put Option) from the date of the
notice and which will be at the latest on the Termination Date.

                                      (i)

<PAGE>

                                                                     EXHIBIT 3.4

                                   STOCK POWER

       FOR VALUE RECEIVED, [_____________] does hereby sell, assign and transfer
unto [_____________] Shares of 5% Cumulative Preferred Stock, Series A of NTL
Incorporated represented by Certificate No. [_____________] (the "Stock"),
standing in its name on the books of said corporation and does hereby
irrevocably constitute and appoint [_____________] attorney to transfer the said
Stock on the books of said corporation with full power of substitution in the
premises.

       Dated:     [_____________], 200[__]

                                        [NAME OF ENTITY]

                                        By: ___________________
                                            Name:

                  In presence of:

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

                  Name:

                                      (ii)

<PAGE>

                                                                      EXHIBIT 18

                    FORM OF ACCESSION NOTICE TO BE DELIVERED
                   BY AN ADDITIONAL BANK PURSUANT TO CLAUSE 18

       To: [Bank Representative]

       (a)    Reference is hereby made to the Put and Call Option Agreement
              dated February 17, 2000, among Banque Nationale de Paris, Credit
              Agricole Indosuez, Deutsche Bank AG Paris Branch, Westdeutsche
              Landesbank Girozentrale Paris Branch and France Telecom (the
              "Option Agreement"). Terms defined in the Option Agreement have
              the same meanings herein.

       (b)    We hereby confirm and give you notice pursuant to clause 18
              Accession of New Banks of the Option Agreement that we wish to
              accede to the Option Agreement and become a Bank for purposes of
              the Option Agreement.

       (c)    We hereby confirm that we have received a copy of the Option
              Agreement and the Purchase Agreement and attached Certificate of
              Designation and hereby undertake and agree to be bound by the
              terms and conditions thereof insofar as such terms and conditions
              apply to a Bank.

       (d)    We hereby confirm that our Option Stock will, upon closing of the
              purchase thereof, consist of [______] shares of Preferred Stock.

       (e)    We hereby confirm that at the date hereof the representations set
              out in clause 9.2 of the Option Agreement would be true (to the
              extent that such representations can relate to ourselves) if
              repeated by reference to and in respect of ourselves on the date
              of this Notice and hereby repeat the same.

       (f)    We hereby confirm that we have received separately on the date
              hereof from France Telecom the fees which should have been due to
              us on or prior to the date hereof pursuant to the provisions of
              clause 6.1 of the Option Agreement.

       (g)    Our details for notices under the Option Agreement are:

                  Address:
              Telephone Number:
              Telex Number:
              Facsimile Number:

                                     (iii)

<PAGE>

       (h)    This Accession Notice shall be governed by and construed in
              accordance with the laws of the State of New York, United States
              of America applicable to contracts executed in and to be performed
              entirely in that state and without regard to any applicable
              conflicts of law principles.

       [NAME OF ENTITY]

       ---------------
       by:

       We hereby confirm our acceptance of the accession by [________] to the
       Option Agreement as provided above and hereby confirm that from the date
       hereof we agree to treat [________] as a Bank under the Option Agreement
       as if it had been named as such at the beginning of the Option Agreement.

       France Telecom

       By : ________________
       Title:

                                      (iv)

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