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                                                                   EXHIBIT 10.26

                                [FLAG LETTERHEAD]

                                  CONFIDENTIAL

October ___, 2002

Adnan Othman Omar
Villa No. 13
Bin Himd Residential Compound
Kayyal Street, Rawdah District
Jeddah, Western Province
Saudi Arabia 21411

             AMENDMENT TO EMPLOYMENT AGREEMENT FOR ADNAN OTHMAN OMAR
              PURSUANT TO THE THIRD AMENDED AND RESTATED JOINT PLAN
                        OF REORGANIZATION OF THE COMPANY

Dear Adnan:

Pursuant to the Third Amended and Restated Joint Plan of Reorganization of
Debtors under Chapter 11 of the Bankruptcy Code (such debtors referred to
collectively herein as the "COMPANY"), as may be amended from time to time (the
"PLAN"), your Employment Agreement dated 1 April 2002 (your "AGREEMENT"), as
amended by the Addendum to your Agreement dated 10 April 2002 (your "ADDENDUM"),
is hereby, effective as of the Effective Date (as defined in the Plan), assumed
by FLAG Telecom Group Limited ("FTGL") as further amended below.

1.   DEFINITIONS. As used herein, "Cause" and "Good Reason" shall have the
     definitions set forth below:

     (a)  "GOOD REASON" shall mean, without your consent, the occurrence of any
          of the following events which is not cured by FTGL within ten (10)
          business days following your written notice to FTGL of the event
          constituting Good Reason; provided, however, that any such written
          notice received by FTGL following the thirty (30) day period after the
          date on which you had first hand knowledge of the occurrence of such
          event giving rise to Good Reason shall not be effective and you shall
          be deemed to have waived your right to terminate employment for Good
          Reason with respect to such event: (i) reduction in your salary or
          target bonus opportunity; (ii) material reduction in any material
          employee benefits generally provided to other employees (unless such
          reduction is done on a

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          company-wide basis); (iii) a breach of any material term of your
          Agreement; (iv) material adverse change in your position, status,
          responsibilities or reporting lines or change in your position,
          status, responsibilities or reporting lines as a result of which such
          position, status, responsibilities or reporting lines are materially
          inconsistent with such position, status, responsibilities or reporting
          lines prior to such change; (v) relocation of your primary office
          location or location where your principal business duties are
          performed more than fifty (50) miles from your current office or
          business location; or (vi) relocating the FLAG management subsidiary
          more than fifty (50) miles from London, England.

     (b)  "CAUSE" shall mean the occurrence of any of the following events or
          circumstances: (i) willful continued failure to substantially perform
          the duties of your position after written notice thereof which, if
          curable, is not cured by you within ten (10) business days following
          FTGL's written notice to you of the event or circumstance constituting
          Cause; provided, however, that any such written notice received by you
          following the thirty (30) day period after the date on which FTGL had
          first hand knowledge of the occurrence of such event or circumstance
          giving rise to Cause shall not be effective and FTGL shall be deemed
          to have waived its right to terminate your employment for Cause with
          respect to such event or circumstance; or (ii) conviction of or plea
          of guilty or no contest for a felony or other crime which, if it were
          made public, could reasonably be expected to have a material adverse
          affect on the business reputation or affairs of FTGL.

2.   RETENTION PAYMENT AMOUNT. You shall vest in your Retention Payment Amount
     on the Effective Date. Notwithstanding anything to the contrary in your
     Agreement or Addendum, you shall be obligated to repay your Retention
     Payment Amount if, prior to the Effective Date, you resign without Good
     Reason or you are terminated for Cause.

3.   ENTERPRISE VALUE BONUS. You shall not be entitled to payment of the
     percentage of the Enterprise Value of the Company as contemplated under
     your Addendum.

4.   2002 BONUS. Your bonus for 2002 shall be paid in accordance with the
     following:

     (a)  You shall be eligible to earn your target bonus as in effect prior to
          the Commencement Date (as defined in the Plan) if (i) you are employed
          on 31 December 2002 by FTGL or (ii) your employment with FTGL
          terminates prior to 31 December 2002 for any reason other than a
          termination for Cause or voluntary resignation for other than Good
          Reason; provided that the conditions of Section 4(c) below are met.

     (b)  Your bonus shall be payable in a cash lump sum as soon as practicable
          following 31 December 2002, but in no event later than 20 January
          2003; provided that, if fourth quarter financial results are not
          available on 15

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          January 2003, the portion of the bonus based upon such results shall
          be payable within five days of such results becoming available, but in
          no event later than March 31, 2003.

     (c)  Fifty percent of your target bonus shall be payable if available cash
          plus working capital of FTGL and its subsidiaries as of the Effective
          Date is equal to or greater than projected or if the available cash
          plus working capital of FTGL and its subsidiaries as of the Effective
          Date is within 2.5 percent of such projection. The remaining fifty
          percent of the target bonus shall be payable if each of cash revenue
          and cash flow in fourth quarter 2002 is equal to or greater than
          projected or if each of cash revenue and cash flow in fourth quarter
          2002 is within 2.5 percent of each such projection.

     (d)  For purposes hereof, the projections referenced in Section 4(c) above
          and the meaning of "available cash plus working capital", "cash
          revenue" and "cash flow" shall be determined consistent with Section
          6.7.4 of the Plan.

5.   TERMINATION OF EMPLOYMENT.

     Clause 8 of your Agreement shall be deleted and replaced with the
     following:

     This Agreement shall continue for a period of two years (the "Fixed Term")
     from 1 April 2002.

     Notwithstanding any other provision herein, you may terminate your
     employment for any reason by 60 days' written notice to FTGL. If you
     terminate your employment with Good Reason, you will be paid a lump sum
     payment of US$610,000. If you terminate your employment for any other
     reason, you will receive no further salary or allowances or any other
     benefit. For the avoidance of doubt, you shall be entitled to your salary,
     allowances and other benefits until your actual termination date.

     Notwithstanding any other provision herein, FTGL may terminate your
     employment at any time. If FTGL terminates your employment for Cause or due
     to your death or disability or if your employment terminates due to the
     expiration of the Fixed Term, you will receive no further salary or
     allowances or any other benefit. If FTGL terminates your employment without
     Cause, you will be paid a lump sum payment of US$610,000.

     In the event of a change in Control, you will be entitled to resign within
     30 days of the change in Control and receive a lump sum payment of
     US$610,000. You shall not be entitled to resign pursuant to this paragraph
     solely as a result of a change in composition of the Board of Directors of
     FTGL or a change in ownership of FTGL, in each case pursuant to the Plan.

     FTGL considers that the current change in control language in this Clause 8
     ("Change in Control") of the Agreement linked to payment is not triggered
     by the Court's decision on a restructuring plan, its implementation, or any
     part of such process. In the event that such restructuring is held to be a
     Change in

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     Control at some future date, the Retention Payment Amount will be deducted
     from any entitlement in the event of a Change in Control.

     Control has the meaning given to it in Section 840 of the Income and
     Corporate Taxes Act 1988, where the company that gained control of FTGL was
     not at the date of the change in Control a Group Company of FTGL. Group
     Company means any company which for the time being is a holding company of
     FTGL or a subsidiary of FTGL (both as defined by S.736 of the Companies Act
     1985) or a subsidiary of a holding company (as defined).

6.   LEGAL EXPENSES.

     (a)  FTGL shall pay your actual documented litigation-related costs and
          expenses (including attorneys fees) to the extent that (i) such costs
          and expenses are pending reimbursement or not actually reimbursed by
          the insurers under the directors and officers liability insurance
          policies of the Company in existence prior to the Effective Date (the
          "POLICIES"), regardless of whether such costs and expenses were
          incurred pre- or post-petition, and (ii) the aggregate amount of the
          payments described in this sentence, together with all other payments
          made pursuant to Section 6.4.1(b) of the Plan, shall not exceed $3.25
          million and the aggregate amount of such payments for the period
          through the first anniversary of the Effective Date shall not exceed
          $1.625 million. Notwithstanding the foregoing, FTGL shall not be
          required to advance costs and expenses that are pending reimbursement
          by the insurers under the Policies if such advancement would result in
          the contravention of the Sarbanes-Oxley Act of 2002 (as defined
          below). "Sarbanes-Oxley Act of 2002" means that certain U.S. federal
          legislation adopted on July 30, 2002, as amended or supplemented from
          time to time, or any U.S. federal statute or regulation adopted by the
          U.S. Securities and Exchange Commission in effect that has replaced,
          amended or supplemented or will replace, amend or supplement such
          statute.

     (b)  You shall take all reasonably necessary action to collect from the
          directors and officers liability insurers of the Company the costs and
          expenses described in Section 6(a) above and fully cooperate with FTGL
          in connection with any coverage disputes under Section 6(f) below. In
          the event of a material violation of your obligation to cooperate with
          FTGL pursuant to the preceding sentence, FTGL's obligation to make
          payments under Section 6(a) above shall terminate.

     (c)  You hereby represent and certify that you have not knowingly made any
          fraudulent statements or material misrepresentations to the directors
          and officers liability insurers of the Company or persons acting on
          their behalf in connection with the directors and officers insurance
          application process. In the event that you are found by a judgment or
          other final adjudication to have knowingly made such a fraudulent
          statement or material misrepresentation, FTGL's obligation to make the
          payments in Section 6(a) above shall immediately terminate and you
          shall be required to refund

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          your pro rata share of any payments made by FTGL pursuant to Section
          6.4.1(b) of the Plan. Such pro rata share shall be determined by
          dividing the total amount of such payments by the total number of
          defendants in the relevant litigation.

     (d)  All payments made pursuant to Section 6(a) above, to the extent
          actually paid by FTGL, shall be immediately reimbursable upon
          collection by you to the extent of and out of any indemnified fees,
          costs and expenses actually reimbursed by the insurers under the
          Policies.

     (e)  FTGL shall reimburse you for attorneys fees and expenses incurred in
          connection with the Chapter 11 Cases (as defined in the Plan), in an
          amount not to exceed, together with all other reimbursements pursuant
          to Section 6.4.2 of the Plan, $180,000 in the aggregate. Any such
          reimbursement shall reduce the maximum amount payable under Section
          6(a) above.

     (f)  FTGL shall pay its own attorneys fees and costs in connection with
          disputes as to coverage under the Policies and take all reasonably
          necessary action to resolve any such disputes; provided, however, that
          FTGL shall not be responsible, either directly or through
          reimbursement, for costs associated with any legal or other
          professionals retained by you in connection with such disputes.

7.   INDEMNIFICATION. You shall be indemnified by FTGL with respect to acts and
     omissions occurring on or after the Effective Date to the same extent as
     the other directors and officers of FTGL.

8.   DEFERRED COMPENSATION. Except with respect to your bonus for 2002, you
     shall not be entitled to receive any deferred compensation earned or
     incurred prior to the Effective Date. For the avoidance of doubt, it is
     understood that the foregoing sentence shall not prevent you from receiving
     the Retention Payment Amount referred to in Section 2 above, to the extent
     eligible.

9.   NO DEFAULTS/CURE OBLIGATIONS. You hereby acknowledge that no default exists
     under your Agreement or Addendum that is required to be cured upon
     assumption.

10.  OTHER TERMS IN EFFECT. Except as specifically modified herein, the
     employment period and other terms of your Agreement and Addendum remain in
     force.

Please indicate your acceptance of the above by signing and dating below.

Sincerely,

FLAG Telecom Group Limited

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By:
   -------------------------------

Name:
Title:

--------------------------------
Adnan Othman Omar

Date
    -------------

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                                                                   EXHIBIT 10.27

[FLAG TELECOM LETTERHEAD]

31 October 2002

Adnan Omar
Villa No 13, Bin Himd Residential Compound
Kayyal Street
Rawdah District
Jeddah, Western Province
Saudi Arabia 21411

                              TERMINATION AGREEMENT

Dear Adnan,

          This letter agreement (this "AGREEMENT") sets forth the terms of your
termination from employment as advisor to the Chairman and CEO of FLAG Telecom
Group Limited and as President of FLAG Telecom Development Services Company LLC,
both limited companies organized under the laws of Bermuda and Egypt
respectively (hereinafter collectively referred to as the "COMPANY").

          1.     RESIGNATION

                 Effective as of November 1, 2002, (the "TERMINATION DATE"), you
will cease to be an employee of the Company and its subsidiaries (collectively,
the "COMPANIES"). By signing this Agreement, you hereby resign as of the
Termination Date as a director of the Company, as a director of any of the other
Companies for which you are then serving as a director, and from every other
capacity in which you serve the Companies, including, if applicable, as an
officer or employee.

          2.     SEVERANCE BENEFITS

          (a)    Your termination of employment hereunder shall be treated as a
termination without Cause under your "Amended Employment Agreement"
(hereinafter, the "EMPLOYMENT AGREEMENT"); provided, however, your right to
receive payments and benefits as a

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result of such termination shall only be governed by the terms of this Agreement
and not the Employment Agreement which shall become null and void on the
Termination Date except as specifically provided herein. On the Termination
Date, the Company shall pay to you a severance payment of $610,000 in U.S.
dollars (without any withholding as per prior practice) in same day funds. This
Agreement will be null and void in case such amount is not paid in full on the
Termination Date.

          (b)    The Company shall pay to you on the Termination Date or as soon
as practicable thereafter, but in no event later than 14 days after the
Termination Date, in accordance with the policies of the Company as currently in
effect, your accrued, but unpaid compensation under the Employment Agreement,
including accrued and unused vacation, living allowance, and reimburse your
expenses for the period ending on the Termination Date, in accordance with the
Company's expense reimbursement policy, to the extent not already paid or
reimbursed.

          (c)    You shall continue to benefit from and be subject to the legal
expense payment provisions in Sections 6.4.1 and 6.4.2 of the Reorganization
Plan of the Company, as confirmed by the US bankruptcy court on September 26,
2002 and as effective as October 9, 2002. In case needed for your defense of any
securities class action lawsuit filed against you, the Company will grant you
and/or your attorneys reasonable access to relevant documents or any other
written material and/or personnel of the Company.

          (d)    You shall be entitled to retain the "Retention Payment Amount"
paid under the Employment Agreement.

          (e)    You shall continue to be covered by the directors and officers
insurance of the Company in the same manner, and to the same extent, as the
active directors and officers of the Company with regard to actions and
inactions while a director and officer of the Company. If the Company elects to
extend and/or continue the directors and officers liability insurance policy of
FLAG Telecom Holdings Limited in effect immediately prior to the Effective Date
for the benefit of the former directors and officers of FLAG Telecom Holdings
Limited generally, then you shall be eligible for the same coverage as such
other directors and officers subject to any generally applicable limitations in
such policy. Your right to any such coverage shall be governed solely by the
terms and conditions of such policy or extension and are in no way guaranteed by
the Company or its affiliates.

          (f)    You shall be indemnified by the Company in accordance with the
Bye-Laws of the Company as in effect on the Effective Date with respect to acts
or omissions as an officer or director.

          (g)    Except as specifically provided herein, or as otherwise may be
required by law, you shall not be entitled to receive any other payments,
benefits or severance amounts from the Company following the Termination Date.

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          3.     COVENANT

                 You shall continue to be bound by the provisions of your
Employment Agreement, incorporated herein by reference, relating to the
prohibition of disclosure of proprietary information, and you shall be required
to return the Company's computer equipment, unless bought by you in mutual
agreement at the Termination Date, and telecommunications equipment upon the
Termination Date.

          4.     Mutual Release

          (a)    It is understood and agreed by the parties to this Agreement
that, in consideration of the mutual promises and covenants contained in this
Agreement, and subject to the performance each party to this agreement (except
for immaterial inadvertent non-performance which is promptly cured by you or the
Company, whichever is applicable) of its respective heirs, executors,
administrators, representatives, agents, successors and assigns hereby
irrevocably and unconditionally release and forever discharge the other party
from any and all causes of action, claims, actions, rights, judgments,
obligations, damages, demands, accountings or liabilities of whatever kind or
character, which each party may have against the other party from the beginning
of the world and through and including the Termination Date

          (b)    Nothing contained in this Section 4 shall serve as a release by
you or any Releasor with respect to any causes of action, claims, actions,
rights, judgments, obligations, damages, demands, defenses, accountings or
liabilities (i) that may arise under this Agreement, (ii) to which you would
otherwise be entitled under the Plan (unless expressly modified by this
Agreement other than Section 4(a) above) or (iii) that you or any other Releasor
would otherwise be entitled to assert by counter-claim, cross-claim, impleader
or otherwise in connection with any cause of action, claim, action, right,
judgment, obligation, damages, demand, accounting or liability that may be
asserted against you or any other Releasor.

          5.     RELATIONSHIP  TO OTHER AGREEMENTS

          On the Termination Date, this Agreement shall constitute the entire
agreement of the parties with regard to the subject matter hereof, contain all
the covenants, promises, representations, warranties and agreements between the
parties with respect to your resignation from the Company and supersede all
prior employment or severance agreements, including any addendum, amendment or
agreement thereto, between you and the Company or any of its predecessors or
affiliates, notwithstanding any survival clauses therein contained. Except as
otherwise provided herein, each party to this Agreement acknowledges that no
representation, inducement, promise or agreement, oral or written, has been made
by either party, or by anyone acting on behalf of either party, which is not
embodied herein, and that no agreement, statement, or promise relating to your
resignation from the Company, that is not contained in this Agreement, shall be
valid or binding. Any modification of this Agreement will be effective only if
it is in writing and signed by the party to be charged.

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          6.     NO WAIVER

          No failure by either party hereto at any time to give notice of any
breach by the other party of, or to require compliance with, any condition or
provision of this Agreement shall (a) be deemed to be a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time or (b) preclude insistence upon strict compliance in the future.

          7.     SEVERABILITY

          If a court of competent jurisdiction determines that any provision of
this Agreement is invalid or unenforceable, then the invalidity or
unenforceability of that provision shall not affect the validity or
enforceability of any other provision of this Agreement, and all other
provisions shall remain in full force and effect and such invalid or
unenforceable provision shall be reformulated by such court to preserve the
intent of the parties hereto.

          8.     COUNTERPARTS

          This Agreement may be executed in three counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same Agreement.

          9.     HEADINGS

          The paragraph headings have been inserted for purposes of convenience
and shall not be used for interpretive purposes.

          10.    ASSIGNMENT

          This Agreement is binding on you and the Company and each of you and
the Company's successors and assigns. None of your rights or obligations
hereunder may be assigned by you to any other person or entity, except by will
or the laws of descent and distribution. In the event of your death prior to
receipt by you thereof, the Severance Payment and the Bonus shall be payable to
your designated beneficiaries on the same schedule as provided for in this
Agreement. The rights and obligations of the Company under this Agreement may
only be assigned to a successor to all or substantially all of the assets of the
Company.

          11.    GOVERNING LAW

          This Agreement shall be governed by the laws of England and Wales
applicable to contracts made and performed therein, without regard to its
conflicts of law principles.

          12.    ACKNOWLEDGMENTS

          You acknowledge that:

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          (a)    You have read and understand the terms of this Agreement and
have voluntarily agreed to these terms without coercion or undue persuasion by
the Company or any officer, director or other agent thereof;

          (b)    This Agreement does not purport to waive, and does not waive,
any rights you may have which arise after the Termination Date.

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                                      * * *

          Please indicate your acceptance of these terms by signing and dating
below.

                                                 Sincerely,

                                                 FLAG Telecom Group Limited
                                                 ---------------------------
                                                 By:

                                                 Name:
                                                 Title:

                                                 ---------------------------
                                                 Adnan Omar

                                                 ---------------------------
                                                 Date

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