Document:

<PAGE>
                                                                   EXHIBIT 10.25

          INTERCONNECTION AGREEMENT UNDER SECTIONS 251 AND 252 OF THE
                         TELECOMMUNICATIONS ACT OF 1996

                         Dated as of December 18, 1998

                                 by and between

                          NEW YORK TELEPHONE COMPANY,
                                     d/b/a
                            BELL ATLANTIC - NEW YORK

                                      and

                            COMMUNITY NETWORKS, INC.
<PAGE>

          INTERCONNECTION AGREEMENT UNDER SECTIONS 251 AND 252 OF THE
                         TELECOMMUNICATIONS ACT OF 1996

     This Interconnection Agreement (this "Agreement"), under Sections 251 and
252 of the Telecommunications Act of 1996 (the "Act"), is effective as of the
18th day of December, 1998 (the "Effective Date"), by and between New York
Telephone Company, d/b/a Bell Atlantic -New York ("BA"), a New York corporation
with offices at 1095 Avenue of the Americas, New York, NY 10036, and Community
Networks, Inc. ("Community"), a New York corporation with offices at 45-18 Court
Square, Suite 403, Long Island City, NY 11101 (each a "Party" and, collectively,
the "Parties").

     WHEREAS, Community has requested that BA make available to Community
Interconnection, service and unbundled Network Elements upon the same terms and
conditions as provided in the Interconnection Agreement (and amendments thereto)
between MGC Communications, Inc. and BA, dated as of April 3, 1998, for New
York, approved by the Public Service Commission ("Commission") under Section 252
of the Act (the "Separate Agreement") and attached as Appendix 1 hereto; and

     WHEREAS, BA has undertaken to make such terms and conditions available to
Community hereby only because of and, to the extent required by, Section 252(i)
of the Act.

     NOW, THEREFORE, in consideration of the mutual provisions contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Community and BA hereby agree as follows:

     1.0  Incorporation of Appendices by Reference

     1.1  Except as expressly stated herein, the terms and conditions of the
Separate Agreement (as set forth in Appendix 1 hereto), as it is in effect on
the date hereof after giving effect to operation of law, and of the other
Appendix hereto, are incorporated by reference in their entirety herein and form
an integral part of this Agreement.

     1.2  References in Appendix 1 hereto to MGC Communications, Inc. or to MGC
shall for purposes of this Agreement be deemed to refer to Community.

     1.3  References in Appendix 1 hereto to the "Effective Date", the date of
effectiveness thereof and like provisions shall for purposes of this Agreement
be deemed to refer to the date first written above.  Unless terminated earlier
in accordance with the terms of Appendix 1 hereto,
<PAGE>

this Agreement shall continue in effect until the Separate Agreement expires or
is otherwise terminated.

     1.4  All references in Appendix 1 hereto to "800/888" shall be deleted in
their entirety and replaced with the following: "800/888/877".

     1.5  Notices to Community under Section 29.10 of Appendix 1 hereto shall be
sent to the following address:

          Community Networks, Inc.
          Chief Operating Officer
          45-18 Court Square
          Suite 403
          Long Island City, NY  11101
          Telephone:  (718) 706-9413
          Facsimile:  (718) 706-9411

     1.6  Notices to BA under Section 29.10 of Appendix 1 hereto shall be sent
to the following address:

          President - Telecom Industry Services
          Bell Atlantic Corporation
          1095 Avenue of the Americas
          40th Floor
          New York, New York 10036
          Facsimile: (212) 597-2585

          with a copy to:

          Bell Atlantic Network Services, Inc.
          Attn: Jack H. White
                Associate General Counsel
          1320 N. Court House Road, 8th Floor
          Arlington, Virginia 22201
          Telephone:  (703) 974-1368
          Facsimile:  (703) 974-0744
<PAGE>

          with a copy to:

          Bell Atlantic Corporation
          1095 Avenue of the Americas
          Room 3732
          New York, NY 10036
          Attn: Sandra Thom
                General Counsel
          Telephone:  (212) 395-6515
          Facsimile:  (212) 768-7568

     1.7  Schedule 4.0 set forth at Appendix 2 hereto shall replace and
supersede in its entirety Schedule 4.0 of Appendix 1 hereto.

     2.0  Clarifications

     2.1  Section 1.50, definition of "Local Traffic", and Section 5.7.3 on
Reciprocal Compensation arrangements, in each case of Appendix 1 hereto, are
hereby deleted in their entirety and replaced as follows:

          "1.50  "Local Traffic" means traffic that is originated by a Customer
     of one Party on that Party's network and terminates to a Customer of the
     other Party on that other Party's network, within a given local calling
     area, or expanded area service ("EAS") area, as defined in BA's effective
     Customer tariffs, or, if the Commission has defined local calling areas
     applicable to all LEC's, then as so defined by the Commission.  In
     addition, Local Traffic does not include any traffic that is transmitted to
     or returned from the Internet at any point during the duration of the
     transmission ("Internet Traffic")."

          "5.7.3  The Reciprocal Compensation arrangements set forth in this
     Agreement are not applicable to Switched Exchange Access Service or to any
     other IntraLATA or InterLATA calls originated on a third party carrier's
     network on a 1+ presubscribed basis or a casual dialed (10XXX or 101XXXX)
     basis or other forms of exchange access, including origination or
     termination of Internet Traffic.  All Switched Exchange Access Service and
     all Toll Traffic shall continue to be governed by the terms and conditions
     of the applicable federal and state Tariffs or the terms and conditions of
     section 6.3, if applicable.  To the extent that either Party is unable to
     measure the volume of such traffic, the Parties agree to work cooperatively
     to estimate such traffic volume.  Unless otherwise provided under
     Applicable Law, Reciprocal Compensation arrangements shall apply to
     IntraLATA Toll Traffic originated on one Party's network and delivered by
     that Party to the other Party's network."

                                       3
<PAGE>

     2.2  The Parties agree that if any judicial or regulatory authority of
competent jurisdiction determines (or has determined) that BA is not required to
furnish any service or item or provide any benefit to Telecommunications
Carriers otherwise required to be furnished or provided to Community hereunder,
then BA may, at its sole option, avail itself of any such determination by
providing written notice thereof to Community.

     2.3  The entry into, filing and performance by BA of this Agreement does
not in any way constitute a waiver by BA of any of the rights and remedies it
may have to seek review of any of the provisions of the Separate Agreement, or
to petition the Commission, other administrative body or court for
reconsideration or reversal of any determination made by any of them, or to seek
review in any way of any portion of this Agreement in connection with
Community's election under Section 252(i) of the Act.

     2.4  Notwithstanding any other provisions of this Agreement, BA shall have
no obligation to perform under this Agreement until such time as Community has
obtained a Certificate of Public Convenience and Necessity ("CPCN") or such
other Commission authorization as may be required by law as a condition for
conducting business in the State of New York as a local exchange carrier.

                                       4
<PAGE>

     IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed as of this 18th day of December, 1998.

COMMUNITY NETWORKS, INC. BELL ATLANTIC- NEW YORK

By:                                   By:
   -------------------------------       ----------------------------------
Printed:                              Printed:     Jeffrey A.  Masoner
         -------------------------             ----------------------------

Title:                                Title:  Vice President-Interconnection
       ----------------------------           ------------------------------
                                               Services Policy & Planning
                                              ------------------------------

                                       5
<PAGE>

              [Letterhead of Bell Atlantic Network-Services, Inc.]

                                                       December 18, 1998

VIA OVERNIGHT MAIL
------------------

Eric G. Roden
Chief Operating Officer
Community Networks, Inc.
45-18 Court Square
Suite 403
Long Island City, NY 11101

          RE:  Interconnection Agreement between Bell Atlantic
               and Community Networks, Inc. for New York
               -----------------------------------------------

Dear Mr. Roden:

     In an Order released on October 30, 1998 in CC Docket 98-79, the FCC ruled
that traffic that originates on a carrier's network and then terminates over the
Internet via the facilities of an Internet Service Provider ("ISP") comprises a
single call.  The FCC also ruled that such traffic, when carried over ADSL
facilities, is jurisdictionally interstate, and not local.  A further order and
notice of proposed rulemaking is to be released in the next several days.

     In light of these developments, and to avoid any other confusion about the
issue, Bell Atlantic is not in a position at this time to execute any
interconnection agreement that does not explicitly state both that Internet
traffic is not local, and that Bell Atlantic is not obligated to pay reciprocal
compensation on such traffic.  Accordingly, our proposed agreements have been
modified to eliminate any possible confusion about the intended and literal
meaning of the contract language.

     Please sign the flagged signature pages and return both signature pages to
my attention at the above address.  The documents will then be forwarded to
Jeffrey A. Masoner for his signature and we will send back one executed set of
signature pages to your attention.

     If you have any questions please contact me on (212) 395-3256.

                                              Sincerely,

                                              Robin L. Calcagno
<PAGE>

                                   APPENDIX 1
<PAGE>

          INTERCONNECTION AGREEMENT UNDER SECTIONS 251 AND 252 OF THE
                         TELECOMMUNICATIONS ACT OF 1996

                           Dated as of April 3, 1998

                                 by and between

                            BELL ATLANTIC - NEW YORK

                                      and

                            MGC COMMUNICATIONS, INC.
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>

Section                                                                    Page
-------                                                                    ----
<C>        <S>                                                             <C>
1.0         DEFINITIONS.......................................................2

2.0         INTERPRETATION AND CONSTRUCTION..................................13

3.0         SCOPE............................................................13

4.0         INTERCONNECTION PURSUANT TO SECTION 251(c)(2)....................14
            4.1  Scope.......................................................14
            4.2  Physical Architecture.......................................15
            4.3  Technical Specifications....................................16
            4.4  Interconnection in Additional LATAs.........................17
5.0         TRANSMISSION AND ROUTING OF TELEPHONE EXCHANGE SERVICE
            TRAFFIC PURSUANT TO SECTION 251(c)(2)............................17
            5.1  Scope of Traffic............................................17
            5.2  Switching System Hierarchy..................................18
            5.3  Trunk Group Architecture and Traffic Routing................19
            5.4  Signaling...................................................20
            5.5  Grades of Service...........................................20
            5.6  Measurement and Billing.....................................21
            5.7  Reciprocal Compensation Arrangements -- Section 251(b)(5)...21

6.0         TRANSMISSION AND ROUTING OF EXCHANGE ACCESS TRAFFIC
            PURSUANT TO 251(c)(2).........................................   23
            6.1  Scope of Traffic.........................................   23
            6.2  Trunk Group Architecture and Traffic Routing.............   23
            6.3  Meet-Point Billing Arrangements..........................   24

7.0         TRANSPORT AND TERMINATION OF OTHER TYPES OF TRAFFIC...........   24
            7.1  Information Services Traffic.............................   24
            7.2  Tandem Transit Service ("Transit Service")...............   26
            7.3  911/E911 Arrangements....................................   27
</TABLE>

                                      -i-

<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

<TABLE>
<CAPTION>

<C>        <S>                                                             <C>

8.0     NUMBER RESOURCES, RATE CENTERS AND RATING POINTS...................   28

9.0     NETWORK MAINTENANCE AND MANAGEMENT; OUTAGES........................   29
        9.1  Cooperation...................................................   29
        9.2  Responsibility for Following Standards........................   29
        9.3  Interference or Impairment....................................   29
        9.4  Repeated or Willful Noncompliance.............................   30
        9.5  Outage Repair Standard........................................   30
        9.6  Notice of Changes -- Section 251(c)(5)........................   30
        9.7  Fraud.........................................................   30

10.0    JOINT NETWORK CONFIGURATION AND GROOMING PROCESS; AND
        INSTALLATION, MAINTENANCE, TESTING AND REPAIR......................   31
        10.1  Joint Network Configuration and Grooming Process.............   31
        10.2  Installation, Maintenance, Testing and Repair................   31
        10.3  Network Reliability Council..................................   32
        10.4  Forecasting, Requirements for Trunk Provisioning.............   32
        10.5  Demand Management Forecasts..................................   33

11.0    UNBUNDLED ACCESS -- SECTION 251(c)(3)..............................   33
        11.1  Available Network Elements...................................   34
        11.2  Unbundled Local Loop ("ULL") Types...........................   34
        11.3  Unbundled Switching Elements.................................   36
        11.4  Unbundled Inter Office Facilities............................   36
        11.5  Operations Support Systems...................................   36
        11.6  Limitations on Unbundled Access..............................   36
        11.7  Availability of Other Network Elements on an Unbundled Basis.   37
        11.8  Provisioning of Unbundled Local Loops........................   38
        11.9  Maintenance of Unbundled Network Elements....................   39
        11.10 Other Terms and Conditions Including Rates and Charges.......   40

12.0    RESALE -- SECTIONS 251(c)(4) and 251(b)(1).........................   40
        12.1  Availability of Wholesale Rates for Resale...................   40
        12.2  Availability of Retail Rates for Resale......................   40
        12.3  Additional Terms Governing Resale and Use of BA Services.....   40

13.0    COLLOCATION -- SECTION 251(c)(6)...................................   41
</TABLE>

                                     -ii-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

<TABLE>
<CAPTION>

<C>        <S>                                                              <C>

        13.6  Dedicated Transit Service....................................   43

14.0    NUMBER PORTABILITY-SECTION 251(B)(2)...............................   43
        14.1  Scope........................................................   43
        14.2  Procedures for Providing INP Through Remote Call Forwarding..   44
        14.3  Procedures for Providing INP Through Route Indexing..........   45
        14.4  Procedures for Providing INP Through Full NXX Code Migration.   46
        14.5  Other Interim Number Portability Options.....................   46
        14.6  Receipt of Terminating Compensation on Traffic to INP'ed
              Numbers......................................................   46
        14.7  Recovery of INP Costs Pursuant to FCC Order and Rulemaking...   47

15.0    DIALING PARITY -- SECTION 251(b)(3)................................   48

16.0    ACCESS TO RIGHTS-OF-WAY -- SECTION 251(b)(4).......................   48

17.0    DATABASES AND SIGNALING............................................   48

18.0    COORDINATED SERVICE ARRANGEMENTS...................................   48
        18.1  Intercept and Referral Announcements.........................   48
        18.2  Coordinated Repair Calls.....................................   49
        18.3  Customer Authorization.......................................   49

19.0    DIRECTORY SERVICES ARRANGEMENTS....................................   50
        19.1  Directory Listings and Directory Distributions...............   50
        19.2  Directory Assistance and Operator Services...................   52
        19.3  Directory Assistance Call Completion.........................   53
        19.4  Directory Assistance Credits.................................   54
        19.5  Direct Access to Directory Assistance........................   55
        19.6  Inward Operator Services.....................................   55
        19.7  Operator Services............................................   56
        19.8  0+ Mechanized Operator Calls (Calling Card, Collect, Bill to
              Third Number)................................................   57
        19.9  0- Operator Handled Calls (Calling Card, Collect, Bill to
              Third Number)................................................   57
        19.10 Operator Emergency Bulletin Service..........................   58
        19.11 Operator Passthrough Service.................................   58

20.0   COORDINATION WITH TARIFF TERMS......................................   59
</TABLE>

                                     -iii-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

<TABLE>
<CAPTION>

<C>        <S>                                                             <C>
21.0    INSURANCE..........................................................   60

22.0    TERM AND TERMINATION...............................................   61

23.0    DISCLAIMER OF REPRESENTATIONS AND WARRANTIES.......................   61

24.0    CANCELLATION CHARGES...............................................   62

25.0    INDEMNIFICATION....................................................   62

26.0    LIMITATION OF LIABILITY............................................   63

27.0    PERFORMANCE STANDARDS FOR SPECIFIED ACTIVITIES.....................   64
        27.1  Performance Standards........................................   64
        27.2  Performance Reporting........................................   64

28.0    COMPLIANCE WITH LAWS; REGULATORY APPROVAL..........................   64
29.0    MISCELLANEOUS......................................................   66
        29.1  Authorization................................................   66
        29.2  Independent Contractor.......................................   66
        29.3  Force Majeure................................................   66
        29.4  Confidentiality..............................................   67
        29.5  Choice of Law................................................   68
        29.6  Taxes........................................................   68
        29.7  Assignment...................................................   69
        29.8  Billing and Payment; Disputed Amounts........................   69
        29.9  Dispute Resolution...........................................   70
       29.10  Notices......................................................   72
       29.11  Section 252(i) Obligations...................................   73
       29.12  Joint Work Product...........................................   73
       29.13  No Third Party Beneficiaries; Disclaimer of Agency...........   73
       29.14  No License...................................................   74
       29.15  Technology Upgrades..........................................   75
       29.16  Survival.....................................................   75
       29.17  Entire Agreement.............................................   75
       29.18  Counterparts.................................................   75
</TABLE>

                                     -iv-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

<TABLE>
<CAPTION>

<C>        <S>                                                             <C>

       29.19  Modification, Amendment, Supplement, or Waiver...............   75
       29.20  Successors and Assigns.......................................   76
       29.21  Publicity and Use of Trademarks or Service Marks.............   76
       29.22  Restructured/New Rates.......................................   76
       29.23  Integrity of BELL ATLANTIC Network...........................   76
</TABLE>

                                      -v-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

LIST OF SCHEDULES AND EXHIBITS

Schedules
---------

Schedule 1.0            Certain Terms As Defined in the Act

Schedule 4.0            Network Interconnection Schedule

Schedule 7.1.4          Billing Arrangements for Variable-Rated Information
                        Services Calls

Exhibits
--------

Exhibit A               Bell Atlantic - New York and MGC Pricing Schedule

Exhibit B               Network Element Bona Fide Request

                                     -vi-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

          INTERCONNECTION AGREEMENT UNDER SECTIONS 251 AND 252 OF THE
                         TELECOMMUNICATIONS ACT OF 1996

     This Interconnection Agreement under Sections 251 and 252 of the
Telecommunications Act of 1996 ("Agreement"), is effective as of the Third day
of April, 1998 (the "Effective Date"), by and between New York Telephone Company
d/b/a Bell Atlantic-New York ("BA" or "Bell Atlantic"), a New York corporation
with offices at 1095 Avenue of the Americas, New York NY 10036, and MGC
Communications, Inc. ("MGC"), a Nevada corporation, with offices at 3301 North
Buffalo Drive, Las Vegas, Nevada 89129.

     WHEREAS, the Parties want to interconnect their networks at mutually agreed
upon points of interconnection to provide Telephone Exchange Services, Switched
Exchange Access Services, and other Telecommunications Services (all as defined
below) to their respective customers;

     WHEREAS, the Parties are entering into this Agreement to set forth the
respective obligations of the Parties and the terms and conditions under which
the Parties will interconnect their networks and provide other services as
required by the Act (as defined below) and additional services as set forth
herein; and

     WHEREAS, Sections 251, 252, and 271 of the Telecommunications Act of 1996
have specific requirements for interconnection, unbundling, and service resale,
commonly referred to as the "Checklist", and the Parties intend that this
Agreement meet those Checklist requirements.

     NOW, THEREFORE, in consideration of the mutual provisions contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, MGC and BA hereby agree as follows:

     This Agreement sets forth the terms, conditions and pricing under which BA
and MGC (individually, a "Party" and collectively, the "Parties") will offer and
provide to each other network Interconnection, access to Network Elements,
ancillary services, and wholesale Telecommunications Services available for
resale within each LATA in which they both operate within New York State.  As
such, this Agreement is an integrated package that reflects a balancing of
interests critical to the Parties.  It will be submitted to the New York Public
Service Commission, and the Parties will specifically request that the
Commission refrain from taking any action to change, suspend or otherwise delay
implementation of the Agreement.  So long as the Agreement remains in effect,
neither Party shall advocate before any legislative, regulatory, or other public
forum that any terms of this Agreement be modified or eliminated, unless
mutually agreed to by the Parties.
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

 1.0 DEFINITIONS

     As used in this Agreement, the following terms shall have the meanings
specified below in this Section 1.0. For convenience of reference only, the
definitions of certain terms that are As Defined in the Act (as defined below)
are set forth on Schedule 1.0. Schedule 1.0 sets forth the definitions of such
terms as of the date specified on such Schedule and neither Schedule 1.0 nor any
revision, amendment or supplement thereof intended to reflect any revised or
subsequent interpretation of any term that is set forth in the Act is intended
to be a part of or to affect the meaning or interpretation of this Agreement.

     1.1  "Act" means the Communications Act of 1934 (47 U.S.C.(S)151 et seq.)
                                                                      ------
as amended by the Telecommunications Act of 1996, and as from time to time
interpreted in the duly authorized rules and regulations of the FCC or a
Commission within its state of jurisdiction.

     1.2  "ADSL" or "Asymmetrical Digital Subscriber Line" is a digital loop
transmission technology which permits the transmission of up to 6 Mbps
downstream (from the CO to the end-user customer) and up to 640 kbps digital
signal upstream (from the end-user customer to the CO).

     1.3  "Affiliate" is As Defined in the Act.

     1.4  "Agreement" means this Interconnection Agreement under Sections 251
and 252 of the Act and all the Exhibits, Schedules, addenda, and attachments
referenced herein and/or appended hereto.

     1.5  "Agreement for Switched Access Meet Point Billing" means the Agreement
for Switched Access Meet Point Billing between the Parties.

     1.6  "Ancillary Traffic" means all traffic that is destined for ancillary
services, or that may have special billing requirements, including but not
limited to the following: BLV/BLVI, Directory Assistance, 911/E911, Operator
Services (IntraLATA call completion), IntraLATA third party, collect and calling
card, 800/888 database query, LIDB, and information services requiring special
billing arrangements between the Parties.

     1.7  "Applicable Laws" or "Applicable Law" means all laws, regulations, and
orders applicable to each Party's performance of its obligations hereunder.

     1.8  "As Defined in the Act" means as specifically defined by the Act and
as from time to time interpreted in the duly authorized rules and regulations of
the FCC or the Commission.
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.9  "As Described in the Act" means as described in or required by the Act
and as from time to time interpreted in the duly authorized rules and
regulations of the FCC or the Commission.

     1.10  "Automatic Number Identification" or "ANI" means a Feature Group D
signaling parameter which refers to the number transmitted through a network
identifying the billing number of the calling party.

     1.11  "Bona Fide Request" or "BFR" means the process described on Exhibit B
that prescribes the terms and conditions relating to a Party's request that the
other Party provide a BFR Item (as defined in Exhibit B) not otherwise provided
by the terms of this Agreement.

     1.12  "Busy Line Verification" or "BLV" means an operator request for a
status check on the line of a called party.  The request is made by one Party's
operator to an operator of the other Party.  The verification of the status
check is provided to the requesting operator.

     1.13  "Busy Line Verification Interrupt" or "BLVI" means a service that may
be requested and provided when Busy Line Verification has determined that a line
is busy due to an ongoing call. BLVI is an operator interruption of that ongoing
call to inform the called party that a calling party is seeking to complete his
or her call to the called party.

     1.14  "Calling Party Number" or "CPN" is a Common Channel Signaling ("CCS")
parameter which refers to the number transmitted through a network identifying
the calling Party.

     1.15  "Central Office Switch" means a switch used to provide
Telecommunications Services, including, but not limited to:

          (a) "End Office Switch" or "End Office" is a switching entity that is
     used to terminate Customer station Loops for the purpose of Interconnection
     to each other and to trunks; and

          (b) "Tandem Office Switch" or "Tandem Office" or "Tandem" is a
     switching entity that has billing and recording capabilities and is used to
     connect and switch trunk circuits between and among End Office Switches and
     between and among End Office Switches and carriers' aggregation points,
     points of termination, or points of presence, and to provide Switched
     Exchange Access Services.

                                      -3-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     A Central Office Switch may also be employed as a combination End
Office/Tandem Office Switch.

     1.16  "CLASS Features" means certain CCS-based features available to
Customers including, but not limited to: Automatic Call Back; Call Trace; Caller
Identification; Call Return and future CCS-based offerings.

     1.17  "Collocation" means an arrangement whereby one Party's (the
"Collocating Party") facilities are terminated in its equipment necessary for
Interconnection or for access to Network Elements offered by the second Party on
an unbundled basis that has been installed and maintained at the premises of a
second Party (the "Housing Party").  For purposes of Collocation, the "premises"
of a Housing Party is limited to a Housing Party Wire Center, other mutually
agreed-upon locations of the Housing Party, or any location for which
Collocation has been ordered by the FCC or Commission.  Collocation may be
"physical" or "virtual".  In "Physical Collocation", the Collocating Party
installs and maintains its own equipment in the Housing Party's premises.  In
"Virtual Collocation", the Housing Party owns, installs, and maintains equipment
dedicated to use by the Collocating Party in the Housing Party's premises.  BA
currently provides Collocation under terms, rates, and conditions as described
in tariffs on file or soon to be filed with the FCC or the Commission.

     1.18  "Commission" or "PSC" means the New York State Public Service
Commission.

     1.19  "Common Channel Signaling" or "CCS" means the signaling system,
developed for use between switching systems with stored-program control, in
which all of the signaling information for one or more groups of trunks is
transmitted over a dedicated high-speed data link rather than on a per-trunk
basis and, unless otherwise agreed by the Parties, the CCS used by the Parties
shall be SS7.

     1.20  "Competitive Local Exchange Carrier" or "CLEC" means any Local
Exchange Carrier other than BA, operating as such in BA's service territory in
New York.  MGC is or will shortly become a CLEC.

     1.21  "Cross Connection" means a jumper cable or similar connection
provided pursuant to Collocation at the Digital Signal Cross Connect, Main
Distribution Frame or other suitable frame or panel between (i) the Collocating
Party's equipment and (ii) the equipment or facilities of the Housing Party.

                                      -4-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.22  "Customer" means a third-Party residence or business that subscribes
to Telecommunications Services provided by either of the Parties.

     1.23  "Customer Proprietary Network Information" or "CPNI" is as Defined in
the Act.

     1.24  "Dialing Parity" is As Defined in the Act. As used in this Agreement,
Dialing Parity refers to both Local Dialing Parity and Toll Dialing Parity.
"Local Dialing Parity" means the ability of Telephone Exchange Service Customers
of one LEC to select a provider and make local calls without dialing extra
digits. "Toll Dialing Parity" means the ability of Telephone Exchange Service
Customers of a LEC to place toll calls (inter or IntraLATA) which are routed to
a toll carrier (IntraLATA or InterLATA) of their selection without dialing
access codes or additional digits and with no unreasonable dialing delay.

     1.25  "Digital Signal Level" means one of several transmission rates in the
time-division multiplex hierarchy.

     1.26  "Digital Signal Level 0" or "DS0" means the 64 Kbps zero-level signal
in the time-division multiplex hierarchy.

     1.27  "Digital Signal Level 1" or "DS1" means the 1.544 Mbps first-level
signal in the time-division multiplex hierarchy.  In the time-division
multiplexing hierarchy of the telephone network, DS1 is the initial level of
multiplexing.

     1.28  "Digital Signal Level 3" or "DS3" means the 44.736 Mbps third-level
in the time-division multiplex hierarchy. In the time-division multiplexing
hierarchy of the telephone network, DS3 is defined as the third level of
multiplexing.

     1.29  "Exchange Access" is As Defined in the Act.

     1.30  "Exchange Message Record" or "EMR" means the standard used for
exchange of telecommunications message information among Telecommunications
Carriers for billable, nonbillable, sample, settlement and study data.  EMR
format is contained in Bellcore Practice BR-010-200-010 CRIS Exchange Message
Record, a Bell Communications Research, Inc. ("Bellcore") document that defines
industry standards for Exchange Message Records.

     1.31  "FCC" means the Federal Communications Commission.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.32  "FCC Regulations" means Title 47 of the Code of Federal Regulations.

     1.33  "Fiber Meet" means an Interconnection architecture method whereby the
Parties physically Interconnect their networks via an optical fiber interface
(as opposed to an electrical interface) at a mutually agreed upon location.

     1.34  HDSL is a digital loop transmission technology which permits the
transmission of up to 768 kbps simultaneously in both directions on a single
non-loaded, twisted copper pair or up to 1544 kbps simultaneously in both
directions on two non-loaded, twisted copper pairs.

     1.35  "Incumbent Local Exchange Carrier" or "ILEC" is As Defined in the
Act. For purposes of this Agreement, BA is an Incumbent Local Exchange Carrier.

     1.36  "Independent Telephone Company" or "ITC" means any entity other than
BA which, with respect to its operations within [STATE), is an Incumbent Local
Exchange Carrier.

     1.37  "Information Services" is As Defined in the Act.

     1.38  "Information Service Traffic" means Local Traffic or IntraLATA Toll
Traffic which originates on a Telephone Exchange Service line and which is
addressed to an information service provided over a Party's switched voice
information services platform (i.e., 976, 550, 540, 970, 940).
                              -----

     1.39  "Inside Wire" or "Inside Wiring" means all wire, cable, terminals,
hardware, and other equipment or materials on the Customer's side of the Rate
Demarcation Point.

     1.40  "Integrated Digital Loop Carrier" or "IDLC" means a subscriber loop
carrier system which integrates within the switch at a DS1 level that is twenty-
four (24) loop transmission paths combined into a 1.544 Mbps digital signal.

     1.41  "Integrated Services Digital Network" or "ISDN" means a switched
network service that provides end-to-end digital connectivity for the
simultaneous transmission of voice and data.  Basic Rate Interface-ISDN (BRI-
ISDN) provides for a digital transmission of two 64 Kbps bearer channels and one
16 Kbps data and signaling channel (2B+D).  Primary Rate Interface-ISDN ("PRI-
ISDN") provides for digital transmission of twenty three (23) 64 kbps bearer
channels and one (1) 64 kpbs data and signaling channel (23 B+D).

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.42  "Interconnection" is As Described in the Act and refers to the
connection of separate pieces of equipment or transmission facilities within,
between, or among networks for the purpose of transmission and routing of
Telephone Exchange Service traffic and Exchange Access traffic.

     1.43  "Interexchange Carrier" or "IXC" means a carrier that provides,
directly or indirectly, InterLATA or IntraLATA Telephone Toll Services.

     1.44  "Interim Telecommunications Number Portability" or "INP" is As
Described in the Act.

     1.45  "InterLATA Service" is As Defined in the Act.

     1.46  "IntraLATA Toll Traffic" means those intraLATA calls that are not
defined as Local Traffic in this Agreement.

     1.47  "Line Side" means an End Office Switch connection that provides
transmission, switching and optional features suitable for Customer connection
to the public switched network, including loop start supervision, ground start
supervision, and signaling for basic rate ISDN service.

     1.48  "Local Access and Transport Area" or "LATA" is As Defined in the Act.

     1.49  "Local Exchange Carrier" or "LEC" is As Defined in the Act.  The
Parties to this Agreement are or will shortly become Local Exchange Carriers.

     1.50  "Local Traffic", means traffic that is originated by a Customer of
one Party on that Party's network and terminates to a Customer of the other
Party on that other Party's network, within a given local calling area, or
expanded area service ("EAS") area, as defined in BA's effective Customer
tariffs, or, if the Commission has defined local calling areas applicable to all
LEC's, then as so defined by the Commission.

     1.51  "Main Distribution Frame" or "MDF" means the ultimate point at which
outside plant facilities terminate within a Wire Center, for interconnection to
other telecommunications facilities within the Wire Center.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.52  "Meet-Point Billing" or "MPB" means the process whereby each Party
bills the appropriate tariffed rate for its portion of a jointly provided
Switched Exchange Access Service as agreed to in the Agreement for Switched
Access Meet Point Billing.

     1.53  "Network Element" is As Defined in the Act.

     1.54  "Network Interface Device" or "NID" means the BA-provided interface
terminating BA's telecommunications network on the property where the Customer's
service is located at a point determined by BA.

     1.55  "North American Numbering Plan" or "NANP" means the numbering plan
used in the United States, Canada, Bermuda, Puerto Rico and certain Caribbean
Islands.  The NANP format is a 10-digit number that consists of a 3-digit NPA
code (commonly referred to as the area code), followed by a 3-digit NXX code and
4-digit line number.

     1.56  "Numbering Plan Area", or "NPA" is also sometimes referred to as an
area code. there are two general categories of NPAs.  "Geographic NPAs" and
"Non-Geographic NPAs".  A Geographic NPA is associated with a defined geographic
area, and all telephone numbers bearing such NPA are associated with services
provided within that geographic area.  A Non-Geographic NPA, also known as a
"Service Access Code" or "SAC Code", is typically associated with a specialized
telecommunications service which may be provided across multiple geographic NPA
areas; 800, 900, 700, 500 and 888 are examples of Non-Geographic NPAs.

     1.57  "Number Portability" or "NP" is As Defined in the Act.

     1.58  "NXX", "NXX Code", or "End Office Code" means the three-digit switch
entity indicator (i.e. the first three digits of a seven digit telephone
number).

     1.59  "Party" means either BA or MGC and "Parties" means BA and MGC.

     1.60  "Permanent Number Portability" or "PNP" means the use of a database
or other technical solution that comports with regulations issued by the FCC to
provide Number Portability for all customers and service providers.

     1.61  "Port Element" or "Port" means a termination on a Central Office
Switch that permits Customers to send or receive Telecommunications over the
public switched network, but does not include switch features or switching
functionality.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

     1.62  "POT Bay" or "Point of Termination Bay" means the intermediate
distributing frame system which serves as the point of demarcation for
collocated Interconnection.

     1.63  "Rate Center" or "Rate Center Area" or "Exchange Area" means the
geographic area that has been identified by a given LEC as being associated with
a particular NPA-NXX code which has been assigned to the LEC for its provision
of Telephone Exchange Services.  The Rate Center Area is the exclusive
geographic area which the LEC has identified as the area within which it will
provide Telephone Exchange Services bearing the particular NPA-NXX designation
associated with the specific Rate Center Area.  A "Rate Center Point" is the
finite geographic point identified by a specific V&H coordinate (as defined in
Bellcore Special Report SR-TSV-002275), located within the Rate Center Area and
used by that LEC to measure distance for the purpose of billing Customers for
distance sensitive Telephone Exchange Services and Toll Traffic.  Rate Centers
will be identical for each Party until such time as MGC is permitted by an
appropriate regulatory body to create its own Rate Centers within an area.

     1.64  "Rate Demarcation Point" means the point where network access
recurring charges and BA responsibility stop and beyond which Customer
responsibility begins, determined in accordance with FCC rules and BA standard
operating practices.

     1.65  "Rating Point" or "Routing Point" means a specific geographic point
identified by a specific V&H coordinate.  The Rating Point is used to route
inbound traffic to specified NPA-NXXs and to calculate mileage measurements for
the distance-sensitive transport charges of switched access services.  Pursuant
to Bell Communications Research, Inc. ("Bellcore") Practice BR 795-100-100 (the
"Bellcore Practice"), the Rating Point may be an End Office location. or a "LEC
Consortium Point of Interconnection." Pursuant to that same Bellcore Practice,
each "LEC Consortium Point of Interconnection" shall be designated by a common
language location identifier ("CLLI") code with (x)KD in positions 9, 10, 11,
where (x) may be any alphanumeric A-Z or 0-9.  The Rating Point must be located
within the LATA in which the corresponding NPA-NXX is located.  However, the
Rating Point associated with each NPA-NXX need not be the same as the
corresponding Rate Center Point, nor must it be located within the corresponding
Rate Center Area, nor must there be a unique and separate Rating Point
corresponding to each unique and separate Rate Center.

     1.66  "Reciprocal Compensation" is As Described in the Act, and refers to
the payment arrangements that recover costs incurred for the transport and
termination of Reciprocal

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

Compensation Traffic originating on one Party's network and terminating on the
other Party's network.

     1.67  "Reciprocal Compensation Call" or "Reciprocal Compensation Traffic"
means a Telephone Exchange Service Call completed between the Parties, which
qualifies for Reciprocal Compensation pursuant to the terms of this Agreement
and prevailing Commission or FCC rules that may exist.

     1.68  "Route Indexing" means the provision of Interim Number Portability
through the use of direct trunks provisioned between end offices of BA and MGC
over which inbound traffic to a ported number will be routed.

     1.69  "Service Control Point" or "SCP" means a node in the Common Channel
Signaling network to which informational requests for service handling, such as
routing, are directed and processed.  The SCP is a real time database system
that, based on a query from a service switching point and via a Signaling
Transfer Point, performs subscriber or application-specific service logic, and
then sends instructions back to the SSP on how to continue call processing.

     1.70  "Signaling Transfer Point" or "STP" means a specialized switch that
provides SS7 network access and performs SS7 message routing and screening.

     1.71  "Single Bill/Multiple Tariff' shall mean that one bill is rendered to
the IXC from all LECs who are jointly providing access service.  A single bill
consists of all rate elements applicable to access services billed on one
statement of charges under one billing account number using each Party's
appropriate access tariffs.  The bill could be rendered by or on behalf of,
either of the Parties.

     1.72  "Strapping" means the act of installing a permanent connection
between a point of termination bay and a collocated interconnector's physical
Collocation node.

     1.73  "Switched Access Detail Usage Data" means a category 1101XX record as
defined in the EMR Bellcore Practice BR-010-200-100.

     1.74  "Switched Access Summary Usage Data" means a category 1150XX record
as defined in the EMR Bellcore Practice BR-010-200-010.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         1.75 "Switched Exchange Access Service" means the offering of
transmission or switching services to Telecommunications Carriers for the
purpose of the origination or termination of Telephone Toll Service. Switched
Exchange Access Services include but may not be limited to: Feature Group A,
Feature Group B, Feature Group D, 700 access, 800 access, 888 access, and 900
access.

         1.76 "Switching Element" is the unbundled Network Element that provides
a CLEC the ability to use switching functionality in a BA End Office switch,
including all vertical services that are available on that switch, to provide
Telephone Exchange Service to its end user customer(s).

         1.77 "Synchronous Optical Network" or "SONET" means an optical
interface standard that allows inter-networking of transmission products from
multiple vendors. The base transmission rate is 51.84 Mbps (OC-1/STS-1) and
higher rates are direct multiples of the base rate.

         1.78 "Tariff' means any applicable federal or state tariff of a Party,
or standard agreement or other document that sets forth the generally available
terms and conditions, each as may be amended by the Party from time to time,
under which a Party offers a particular service, facility, or arrangement. A
Tariff shall not include BA's "Statement of Generally Available Terms and
Conditions for Interconnection, Unbundled Network Elements, Ancillary Services
and Resale of Telecommunications Services" which has been approved or is pending
approval by the Commission pursuant to Section 252(f) of the Communications Act
of 1934, 47 U.S.C. ss.252(f).

         1.79     "Technically Feasible Point" is As Described in the Act.

         1.80     "Telecommunications" is As Defined in the Act.

         1.81     "Telecommunications Act" means the Telecommunications Act of
1996 and any rules and regulations promulgated thereunder.

         1.82     "Telecommunications Carrier" is As Defined in the Act.

         1.83     "Telecommunications Service" is As Defined in the Act.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         1.84 "Telephone Exchange Service" sometimes also referred to as
"Exchange Service," is As Defined in the Act. Telephone Exchange Service
generally provides the Customer with a telephonic connection to, and a unique
telephone number address on, the public switched telecommunications network, and
enables such Customer to place or receive calls to all other stations on the
public switched telecommunications network.

         1.85 "Telephone Exchange Service Call" or "Telephone Exchange Service
Traffic" means a call completed between two Telephone Exchange Service Customers
of the Parties located in the same LATA, originated on one Party's network and
terminated on the other Party's network where such call was not carried by a
third Party as either a presubscribed call (1+) or a casual dialed (10XXX) or
(101XXX) call. Telephone Exchange Service Traffic is transported over Traffic
Exchange Trunks.

         1.86 "Telephone Toll Service" (or "Toll Traffic"), is as defined in the
Act.

         1.87 "Transit Traffic" means any traffic that originates from or
terminates at MGC's network, "transits" BA's network substantially unchanged,
and terminates to or originates from a third carrier's network, as the case may
be. "Transit Service" provides MGC with the ability to use its connection to a
BA Tandem for the delivery of calls which originate or terminate with MGC and
terminate or originate from a carrier other than BA, such as another CLEC, a LEC
other than BA, or a wireless carrier. In these cases, neither the originating
nor terminating Customer is a Customer of BA. This service is provided through
BA's Tandems and applies only where the terminating End Office of the third
carrier subtends the BA Tandem. "Transit Traffic" and "Transit Service" do not
include or apply to traffic that is subject to an effective Meet-Point Billing
arrangement.

         1.88 "Trunk Side" means a Central Office Switch connection that is
capable of, and has been programmed to treat the circuit as, connecting to
another switching entity (e.g. another carrier's network). Trunk Side
connections offer those transmission and signaling features appropriate for the
connection of switching entities.

         1.89 "Unbundled Local Loop" or "ULL" or "Loop" means a transmission
path that extends from the Main Distribution Frame, DSX panel or functionally
comparable piece of equipment in the Customer's serving End Office to the Rate
Demarcation Point (or network interface device (NID) if installed) in or at a
Customer's premises. The actual loop transmission facilities used to provide an
ULL may utilize any of several technologies.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         1.90 "Undefined Terms" means the Parties acknowledge that terms may
appear in this Agreement which are not defined and agree that any such terms
shall be construed in accordance with their customary usage in the
telecommunications industry as of the effective date of this Agreement, except
that any undefined term herein shall be interpreted in accordance with the
definition or its use in the FCC Interconnection Order and the FCC Further
Interconnection Order.

         1.91 "Voice Grade" means either an analog signal of 300 to 3000 Hz or a
digital signal of 56/64 kilobits per second. When referring to digital voice
grade service (a 56/64 kbps channel), the terms "DS-0" or "sub-DS-1" may also be
used.

         1.92 "Wire Center" means a building or portion thereof in which a Party
has the exclusive right of occupancy and which serves as Routing Point for
Switched Exchange Access Service.

200      INTERPRETATION AND CONSTRUCTION

         2.1 All references to Sections, Exhibits and Schedules shall be deemed
to be references to Sections of, and Exhibits and Schedules to, this Agreement
unless the context shall otherwise require. The headings used in this Agreement
are inserted for convenience of reference only and are not intended to be a part
of or to affect the meaning of this Agreement. Unless the context shall
otherwise require, any reference to any agreement, other instrument (including
BA or other third Party offerings, guides or practices), statute, regulation,
rule or tariff is to such agreement, instrument, statute, regulation, or rule or
tariff as amended and supplemented from time to time (and, in the case of a
statute, regulation, rule or tariff, to any successor provision).

         2.2 Subject to the terms set forth in Section 20 regarding rates and
charges, each Party hereby incorporates by reference those provisions of its
tariffs that govern the provision of any of the services or facilities provided
hereunder. If any provision of this Agreement and an applicable tariff cannot be
reasonably construed or interpreted to avoid conflict, the provision contained
in this Agreement shall prevail, provided that in all cases the more specific
shall prevail over the more general. If any provision contained in this main
body of the Agreement and any Schedule or Exhibit hereto cannot be reasonably
construed or interpreted to avoid conflict, the provision contained in this main
body of the Agreement shall prevail. The fact that a condition, right,
obligation, or other term appears in this Agreement but not in any such tariff

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

shall not be interpreted as, or be deemed grounds for finding, a conflict for
purposes of this Section 2.

300      SCOPE

         This Agreement sets forth the terms and conditions under which MGC can
obtain access to Unbundled Network Elements, Resale and Interconnection from BA,
consistent with the rights and obligations set forth in the Act, in order for
MGC to provide Telecommunication Services to its own customers. MGC warrants and
represents that it is a Telecommunications Carrier ("TC") under the Act. Each
Party is solely responsible for the services it provides to its Customers and to
other Telecommunications Carriers.

400      INTERCONNECTION PURSUANT TO SECTION 251(c)(2)

         The types of Traffic to be exchanged under this Agreement shall be
Local Traffic, IntraLATA Toll (and InterLATA Toll, as applicable) Traffic,
Transit Traffic, Meet Point Billing Traffic, and Ancillary Traffic. Subject to
the terms and conditions of this Agreement, Interconnection of the Parties
facilities and equipment pursuant to this Section 4.0 for the transmission and
routing of Telephone Exchange Service traffic and Exchange Access traffic shall
be established on or before the corresponding "Interconnection Activation Date"
shown for each such LATA within the State of New York on Schedule 4.0. Schedule
4.0 may be revised and supplemented from time to time upon the mutual agreement
of the Parties to reflect additional or changed Interconnection Points in New
York State pursuant to subsection 4.4 by attaching one or more supplementary
addenda to such Schedule. Interconnection in the LATA shall be accomplished
through either (i) Collocation as provided in Section 13.0, (ii) a Fiber Meet as
provided in subsection 4.2, (iii) any other Interconnection method provided by
applicable tariff, law, rule or regulation, or (iv) any other Interconnection
method to which the Parties may agree.

         4.1      Scope

         4.1.1 Section 4 describes the architecture for interconnection of the
Parties' facilities and equipment over which the Parties shall configure the
following separate and distinct trunk groups:

                  Traffic Exchange Trunks for the transmission and routing of
terminating Local Traffic, Transit Traffic, translated LEC IntraLATA 800/888
traffic, IntraLATA Toll Traffic, and,

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

where agreed to between the Parties and as set forth in subsection 5.3.3 below,
InterLATA Toll Traffic between their respective Telephone Exchange Service
customers pursuant to Section 251(c)(2) of the Act, in accordance with Section 5
below;

                  Access Toll Connecting Trunks for the transmission and routing
of Exchange Access traffic, including translated InterLATA 800/888 traffic,
between MGC Telephone Exchange Service customers and purchasers of Switched
Exchange Access Service via a BA Tandem, pursuant to Section 251(c)(2) of the
Act, in accordance with Section 6 below;

                  Information Services Trunks for the transmission and routing
of terminating Information Services Traffic in accordance with Section 7 below;

                  BLV/BLVI Trunks for the transmission and routing of
terminating BLV/BLVI traffic, in accordance with Section 19 below;

                  911/E911 Trunks for the transmission and routing of
terminating E911/911 traffic, in accordance with Section 7 below;

                  Directory Assistance Trunks for the transmission and routing
of terminating directory assistance traffic, in accordance with Section 19.0
below;

                  Operator Services (IntraLATA call completion) Trunks for the
transmission and routing of terminating IntraLATA call completion traffic, in
accordance with Section 19.0 below;

                  Choke Trunks for traffic congestion and testing; and

                  Others as may be requested and agreed to by the Parties.

         4.1.2 The Parties shall configure separate trunk groups (as described
in subsection 4.1.1 above) for traffic from MGC to BA, and for traffic from BA
to MGC, respectively; however, the trunk groups shall be equipped as two-way
trunks for testing purposes. As provided in Section 10 below, the Parties agree
to consider as part of the Joint Grooming Process the feasibility of combining
any of the separate trunk groups into a single two-way trunk group.

         4.2      Physical Architecture

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         In each LATA identified on Schedule 4.0, MGC and BA shall utilize the
Interconnection points designated in such Schedule to configure a network
Interconnection arrangement under a joint network configuration and Grooming
Process ("Joint Grooming Process" as defined in Section 10.1). Both Parties will
endeavor to provision a diverse, reliable network that incorporates the most
practicable technologies.

                  4.2.1      Network architecture shall be defined under the
Joint Grooming Process.

                             4.2.1.1 The Parties shall establish physical
                  Interconnection points at the locations designated on Schedule
                  4.0. Points on the MGC network from which MGC will provide
                  transport and termination of traffic are designated as the MGC
                  Interconnection Points ("MGC-IP" or "[C]-IP"). Points on the
                  BA network from which BA will provide transport and
                  termination of traffic are designated as the BA
                  Interconnection Points ("BA-IP"). Additional Interconnection
                  points may be established by mutual agreement of both parties
                  at any technically feasible points consistent with Act.

                             4.2.1.2 Each Party will provide owned or leased
                  facilities to deliver traffic originated on its respective
                  networks to the designated Interconnection Points of the other
                  Party's network. The Party terminating the traffic will be
                  responsible for all transport and termination of calls beyond
                  the designated Interconnection point.

                  4.2.2 The Parties may implement one of the following
configurations as part of the Joint Grooming Process, unless an alternative plan
is mutually agreed to by both Parties.

                             (a)     a jointly maintained SONET network, in
                                     which each Party is responsible for the
                                     procurement, installation, and maintenance
                                     of mutually agreed-upon Optical Line
                                     Terminating Multiplexer ("OLTM") equipment
                                     at its respective premises. Additionally,
                                     each Party will be responsible for the
                                     installation and maintenance of one-half of
                                     a fiber optic ring;

                             (b)     Interconnection of networks at an optical
                                     level via a Fiber Meet or other comparable
                                     means.

         4.3      Technical Specifications

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  4.3.1 MGC and BA shall work cooperatively to install and
maintain a reliable network. MGC and BA shall exchange appropriate information
(e.g., maintenance contact numbers, network information, information required to
comply with law enforcement and other security agencies of the Government and
such other information as the Parties shall mutually agree) to achieve this
desired reliability.

                  4.3.2 MGC and BA shall work cooperatively to apply sound
network management principles by invoking network management controls to
alleviate or to prevent congestion.

                  4.3.3 The publication "Bellcore Technical Publication
GR-342-CORE; High Capacity Digital Special Access Service, Transmission
Parameter Limits and Interface Combinations" describes the practices,
procedures, specifications and interfaces generally utilized by BA and is
referenced herein to assist the Parties in meeting their respective
Interconnection responsibilities related to electrical/optical interfaces.

         4.4      Interconnection in Additional LATAs

                  4.4.1 If MGC determines to offer Telephone Exchange Services
in any other LATA in which BA also offers Telephone Exchange Services in New
York State, MGC shall provide written notice to BA of the need to establish
Interconnection in such LATA pursuant to this Agreement.

                  4.4.2 The notice provided in subsection 4.4.1 shall include
(i) the initial Rating Point MGC has designated in the new LATA; (ii) MGC's
requested Interconnection Activation Date; and (iii) a non-binding forecast of
MGC's trunking requirements.

                  4.4.3 Unless otherwise agreed by the Parties, the Parties
shall designate the Wire Center(s) MGC has identified as its initial Rating
Point(s) in the LATA as the MGC-IP(s) in that LATA and shall designate the BA
Tandem Office Wire Center within the LATA nearest to the MGC-IP (as measured in
airline miles utilizing the V&H coordinates method as defined in Bellcore
Special Report SR-TSV-002275) as the BA-IP in that LATA.

500      TRANSMISSION AND ROUTING OF TELEPHONE EXCHANGE SERVICE TRAFFIC PURSUANT
         TO SECTION 251(c)(2)

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         5.1      Scope of Traffic

         Section 5.0 prescribes parameters for trunk groups (the "Traffic
Exchange Trunks") to be effected over the Interconnections specified in Section
4.0 for the transmission and routing of Local Traffic, Transit Traffic,
translated LEC IntraLATA 800/888 traffic, InterLATA Toll Traffic (to the extent
applicable), and IntraLATA Toll Traffic between the Parties' respective
Telephone Exchange Service Customers.

         5.2      Switching System Hierarchy

                  5.2.1 For purposes of this Section 5.0, each of the following
Central Office Switches shall be designated as a "Primary Switch":

                  (a)        Each Tandem Office BA operates in the LATA;

                  (b)        The initial switch MGC employs to provide Telephone
                             Exchange Service in the LATA;

                  (c)        Any Tandem Office MGC may establish for provision
                             of Exchange Access in the LATA;

                  (d)        Any additional switch MGC may subsequently employ
                             to provide Telephone Exchange Service in the LATA
                             which MGC may at its sole option designate as a
                             Primary Switch; provided that the total number of
                             MGC Primary Switches for a LATA may not exceed the
                             total number of BA Primary Switches for that LATA.
                             To the extent MGC chooses to designate any
                             additional switch as a Primary Switch, it shall
                             provide notice to BA of such designation at least
                             ninety (90) days in advance of the date on which
                             MGC activates such switch as a Primary Switch; and

                  (e)        Any additional tandem switch BA may subsequently
                             employ to provide access and/or sector traffic
                             capacity within a LATA. Traffic destined to
                             sub-tending Secondary Switches routed via such a
                             tandem(s) would be determined by network
                             requirements and notice made available to all LECs
                             at least one hundred and eighty (180) days prior to
                             service introduction.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  5.2.2 For purposes of this Section 5.0, each of the following
Central Office Switches shall be designated as a "Secondary Switch".

                  (a)        Each Central Office Switch operated by the Parties
                             which is not designated as a Primary Switch
                             pursuant to Section 5.2.1 shall be designated as a
                             "Secondary Switch".

                  (b)        A geographically relevant End Office or functional
                             equivalent, at a technically feasible IP
                             established by one Party at the other Party's
                             request (collectively, a "Virtual End Office"). For
                             purposes of this Agreement, a "geographically
                             relevant" IP shall mean an IP that is located
                             within the same Rate Center Area as the NXX's to
                             which traffic is to be terminated are assigned, or,
                             with the mutual agreement of the Parties, an
                             existing and currently utilized IP within the LATA
                             but outside the applicable Rate Center Area. If
                             after sixty (60) days following said request, the
                             Parties have been unable to reach agreement on the
                             additional Interconnection Point(s), then either
                             Party may file a complaint with the Commission to
                             resolve such impasse or pursue any other remedy
                             available under law or equity.

                  5.2.3 For purposes of MGC routing traffic to BA, the
sub-tending arrangements between BA Primary Switches and BA Secondary Switches
shall be the same as the Tandem/End Office sub-tending arrangements which BA
maintains for the routing of its own or other carriers' traffic. For purposes of
BA routing traffic to MGC, the sub-tending arrangements between MGC Primary
Switches and MGC Secondary Switches shall be the same as the Tandem/End Office
sub-tending arrangements which MGC maintains for the routing of its own or other
carriers' traffic.

         5.3      Trunk Group Architecture and Traffic Routing

         The Parties shall jointly engineer and configure Traffic Exchange
Trunks over the physical Interconnection arrangements where such arrangements
exist for the transport and termination of Telephone Exchange Service Traffic as
follows:

                  5.3.1 The Parties shall each initially configure a separate
two-way trunk group as direct transmission path between each MGC Primary Switch
and each BA Primary Switch.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  5.3.2 Notwithstanding anything to the contrary in this Section
5.0, if the individual trunk group volumes between any two Central Office
Switches (whether Primary-Primary, Primary-Secondary, or Secondary-Secondary)
consistently exceed the blocking parameters established in the Joint Grooming
Process, the Parties will augment such trunk groups so as to achieve established
service objectives. Such augmentation shall be consistent with established
network design methods using modular trunk engineering techniques where
practical.

                  5.3.3 BA and MGC will allow each other to route their
intrastate and interstate switched access service traffic over the Traffic
Exchange Trunk Groups, pursuant to the rates, terms and conditions specified in
each Party's effective intrastate and interstate access tariffs or at Generally
available and prevailing rates, terms and conditions.

         5.4      Signaling

         Each Party will provide the other Party with access to its databases
and associated signaling necessary for the routine and completion of the other
Party's traffic in accordance with the following, provisions, and with Section
17.0 below:

                  5.4.1 Where available, CCS signaling shall be used by the
Parties to set up calls between the Parties' Telephone Exchange Service
networks. If CCS signaling is unavailable, MF ("Multi-Frequency") signaling
shall be used by the Parties. Each Party shall charge the other Party equal and
reciprocal rates for CCS signaling in accordance with applicable tariffs.

                  5.4.2 The publication "Bellcore Special Report SR-TSV-002275,
BOC Notes on the LEC Networks-Signaling" describes the practices, procedures and
specifications Generally utilized by BA for signaling, purposes and is
referenced herein to assist the Parties in meeting their respective
Interconnection responsibilities related to signaling.

                  5.4.3 The Parties will cooperate on the exchange of
Transactional Capabilities Application Part ("TCAP") messages to facilitate
interoperability of CCS-based features between their respective networks,
including all CLASS features and functions, to the extent each Party offers such
features and functions to its Customers. All CCS signaling parameters will be
provided including, calling Party number ("CPN"), originating line information
("OLI"), calling Party category and charge number.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  5.4.4 Upon request, each Party shall provide trunk groups
where available that are configured utilizing the B8ZS ESF protocol for 64 Kbps
clear channel transmission to allow for ISDN interoperability between the
Parties' respective networks.

         5.5      Grades of Service

         The Parties shall engineer and shall jointly monitor and enhance all
trunk groups consistent with the Joint Grooming Process as set forth in Section
10.

         5.6      Measurement and Billing

                  5.6.1 For billing purposes, each Party shall pass Calling
Party Number ("CPN") information on each call carried over the Traffic Exchange
Trunks; provided, however, that so long as the percentage of calls passed with
CPN is greater than ninety percent (90%), all calls exchanged without CPN
information shall be billed as either Local Traffic or IntraLATA Toll Traffic in
direct proportion to the minutes of use of calls exchanged with CPN information.

                  5.6.2 Measurement of billing minutes (except for originating
800/888 calls) shall be in actual conversation seconds. Measurement of billing
minutes for originating 800/888 calls shall be in accordance with applicable
tariffs.

                  5.6.3 Where CPN is not available in a LATA for greater than
ten percent (10%) of the traffic, the Party sending the traffic shall provide
factors to determine the jurisdiction, as well as local vs. toll distinction, of
the traffic. Such factors shall be supported by call record details that will be
made available for review upon request when a Party is passing CPN but the
receiving Party is not properly receiving or recording the information. The
Parties shall cooperatively work to correctly identify the traffic, and
establish a mutually agreeable mechanism that will prevent improperly rated
traffic. Notwithstanding this, if any improperly rated traffic occurs, the
Parties agree to reconcile it.

         5.7      Reciprocal Compensation Arrangements -- Section 251(b)(5)

                  5.7.1 Reciprocal Compensation only applies to the transport
and termination of Reciprocal Compensation Traffic billable by BA or MGC which a
Telephone Exchange Service Customer originates on BA's or MGC's network for
termination on the other Party's network within the same LATA except as provided
in Section 5.7.6 below.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  5.7.2 The Parties shall compensate each other for transport
and termination of Reciprocal Compensation Traffic in an equal and symmetrical
manner for the application of rates as provided in the Pricing Schedule (Exhibit
A hereto).These rates are to be applied at the MGC-IP for traffic delivered by
BA, and at the BA-IP for traffic delivered by MGC. Tandem rates will be applied
for traffic terminated to a Primary Switch; End Office rates will be applied for
traffic terminated to a Secondary Switch. No additional charges, including port
or transport charges, shall apply for the termination of Reciprocal Compensation
Traffic delivered to the MGC-IP or the BA-IP. When Reciprocal Compensation
Traffic is terminated over the same trunks as Switched Exchange Access Service,
any port or transport or other applicable access charges related to the Switched
Exchange Access Service shall be prorated to be applied only to such other
Switched Exchange Access Service.

                  5.7.3 The Reciprocal Compensation arrangements set forth in
this Agreement are not applicable to Switched Exchange Access Service or to any
other IntraLATA or InterLATA calls originated on a third party carrier's network
on a 1+ presubscribed basis or a casual dialed (10XXX or 101XXXX) basis. All
Switched Exchange Access Service and all Toll Traffic shall continue to be
governed by the terms and conditions of the applicable federal and state Tariffs
or the terms and conditions of section 6.3, if applicable. Similarly, the
Parties agree that the issue of what, if any, compensation is applicable to
traffic handed off from one Party to the other Party, within a BA local calling
area (or other calling area otherwise applicable for Reciprocal Compensation),
for delivery to an Internet Service Provider (ISP) for carriage over the
Internet is currently pending before the FCC. Until such time as the issue is
resolved by the FCC or by an applicable order of the Commission or Court with
jurisdiction over the appropriate compensation for such traffic exchange, the
Parties agree that the Reciprocal Compensation arrangements contained in this
subsection 5.7 shall not apply to such traffic. To the extent that either Party
is unable to measure the volume of such traffic, the Parties agree to work
cooperatively to estimate such traffic volume. Unless otherwise provided under
Applicable Law, Reciprocal Compensation arrangements shall apply to IntraLATA
Toll Traffic originated on one Party's network and delivered by that Party to
the other Party's network.

                  5.7.4 The rates for termination of Reciprocal Compensation
Traffic are set forth in Exhibit A which is incorporated by reference herein.

                  5.7.5 The designation of Traffic as Local or Toll for purposes
of compensation shall be based on the actual originating and terminating points
of the complete end-to-end call, regardless of the entities involved in carrying
any segment of the call.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  5.7.6 Compensation for transport and termination of all
traffic which is subject to performance of INP by one Party for the other Party
pursuant to Section 14.0 shall be as specified in subsection 14.6.

                  5.7.7 Each Party reserves the right to measure and audit all
Reciprocal Compensation Traffic, up to a maximum of two audits per calendar
year, to ensure that proper rates are being applied appropriately, provided,
however, that either Party shall have the right to conduct additional audit(s)
if the preceding audit disclosed material errors or discrepancies. Each Party
agrees to provide the necessary Reciprocal Compensation Traffic data or permit
the other Party's recording equipment to be installed for sampling purposes in
conjunction with any such audit.

                  5.7.8 When either Party delivers seven (7) or ten (10) digit
translated IntraLATA toll-free service access codes (e.g., 800/888) service to
the other Party for termination, the originating Party shall provide the
terminating Party with billing records in industry standard format (EMR) if
required by the terminating Party. The originating Party may bill the
terminating, Party for the delivery of the traffic at local reciprocal
compensation rates. The terminating Party may not bill the originating Party
reciprocal compensation under this Agreement. The Party that is providing the
toll-free service access codes (e.g. 800/888) service shall pay the database
inquiry charge per the Pricing Schedule to the Party that performed the database
inquiry.

600      TRANSMISSION AND ROUTING OF EXCHANGE ACCESS TRAFFIC PURSUANT TO
         251(c)(2)

         6.1      Scope of Traffic

         Section 6.0 prescribes parameters for certain trunk groups ("Access
Toll Connecting Trunks") to be established over the Interconnections specified
in Section 4.0 for the transmission and routing of Exchange Access traffic
between MGC's Telephone Exchange Service Customers and Interexchange Carriers
("IXC's").

         6.2      Trunk Group Architecture and Traffic Routing

                  6.2.1 The Parties shall jointly establish Access Toll
Connecting Trunks by which they will jointly provide tandem-transported Switched
Exchange Access Services to

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

Interexchange Carriers to enable such Interexchange Carriers to originate and
terminate traffic from/to MGC's Customers.

                  6.2.2 Access Toll Connecting Trunks shall be used solely for
the transmission and routing of Exchange Access to allow MGC's Customers to
connect to or be connected to the interexchange trunks of any Interexchange
Carrier which is connected to a BA Tandem.

                  6.2.3 The Access Toll Connecting Trunks shall be two-way
trunks connecting an End Office Switch MGC utilizes to provide Telephone
Exchange Service and Switched Exchange Access in a given LATA to a Tandem Switch
BA utilizes to provide Exchange Access in such LATA.

                  6.2.4 The Parties shall jointly determine which BA Tandem(s)
will be subtended by each MGC End Office Switch. MGC's end office switch shall
sub-tend the BA Tandem that would have served the same rate center on BA's
network.

         6.3      Meet-Point Billing Arrangements

                  6.3.1 Meet-Point Billing arrangements between the Parties for
jointly-provided Switched Exchange Access Services on Access Toll Connecting
Trunks will be governed by the terms and conditions of a mutually agreeable
arrangement which the Parties will work to develop.

                  6.3.2 With respect to the Meet Point Billing arrangements,
until and unless changed by the FCC on a going forward basis, MGC shall retain
one hundred percent (100%) of the Residual Interconnection Charge in instances
in which MGC provides the end office switching.

700      TRANSPORT AND TERMINATION OF OTHER TYPES OF TRAFFIC

         7.1      Information Services Traffic

         The following provisions shall apply only to MGC-originated Information
Services Traffic directed to an information services platform connected to BA's
network. At such time as MGC connects information services platforms to its
network, the Parties shall agree upon a comparable arrangement for BA-originated
Information Services Traffic. The Information Services Traffic subject to the
following provisions is switched voice traffic, delivered to service

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

providers who offer recorded announcement information or open discussion
information programs to the general public; it is not Internet traffic.

                  7.1.1 MGC shall have the option to route Information Services
Traffic that originates on its own network to the appropriate information
services platform(s) connected to BA's network. In the event MGC exercises such
option, MGC will establish a dedicated trunk group to the BA information
services serving switch. This trunk group will be utilized to allow MGC to route
information service traffic originated on its network to BA.

         Where MGC serves a Customer through the purchase of a BA unbundled Port
Element, information service traffic from that Customer may be routed over BA
information service trunks on a shared basis.

                  7.1.2 Nothing in this Agreement shall restrict either Party
from offering or obviate either Party's obligations, if any, under Applicable
Laws, to offer to its Telephone Exchange Service Customers the ability to block
the completion of Information Service Traffic.

                  7.1.3 For calls to an "Information Mass Announcement Service"
("IMAS"), which service is only available in the New York Metro LATA (LATA 132),
MGC shall bill and collect the information services provider charges as defined
in the existing New York PSC No. 900 Tariff, as may be amended from time to
time. BA will bill MGC for such charges less the Information Services Billing
and Collection fee set forth in Exhibit A. MGC shall pay BA in full regardless
of uncollectible charges to its own Customers. BA may request recorded call
information from MGC, to be delivered in unrated EMR format via electronic file
transfer or other medium mutually agreeable to the two Parties, at the customer
usage detail charges specified in Exhibit A. This arrangement shall apply
whether MGC serves its customer from switching facilities outside the BA
network, or from a BA unbundled Port Element.

                  7.1.4 For calls to variable rated information services (e.g.,
NXX 550, 540, 976, 970, 940 as applicable), the Parties shall agree to implement
either of two separate billing arrangements, as set forth in Schedule 7.1.4.
Under either arrangement, MGC shall bill and collect information services
provider charges from its Customers. BA shall charge MGC, and the Parties shall
exchange call detail information and handle adjustments, according to the terms
set forth in the agreed upon billing arrangement, at customer usage detail rates
specified in Exhibit A. Applicable information shall be provided in as timely a
fashion as practical in order to facilitate record review and reflect actual
prices set by the individual information services providers. The same billing
arrangements shall apply whether MGC serves its Customer from

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

switching facilities outside the BA network, or from BA unbundled Local
Switching Elements, and agreement to mutually support one or the other billing
arrangement shall precede interconnection of the MGC network to the appropriate
information services platform(s) connected to BA's network. BA may require
reasonable demonstration, as defined in the applicable billing arrangement, that
the agreed upon arrangement has been implemented by MGC prior to establishing
such interconnection.

                  7.1.5 Where BA agrees to accept adjustments from MGC for calls
originated by MGC Customers to information services platform(s) connected to
BA's network, MGC shall follow the same policy in allowing adjustments to its
Customers as BA follows with its own Customers. MGC shall provide to BA
sufficient information regarding uncollectibles and Customer adjustments to
allow BA to pass through the adjustments to the information services provider,
and BA shall pass through such adjustments. However, if the information services
provider disputes such adjustments and refuses to accept such adjustments, MGC
shall reimburse BA for all such disputed adjustments. Final resolution regarding
all disputed adjustments shall be solely between MGC and the information
services provider.

                  7.1.6 The Information Services Traffic addressed herein does
not include 555 traffic or similar traffic with AIN service interfaces, which
traffic shall be subject to separate arrangements between the Parties.

         7.2      Tandem Transit Service ("Transit Service")

                  7.2.1 "Transit Service" means the delivery of certain traffic
between MGC and another Local Exchange Carrier by BA over the Telephone Exchange
Service Trunks, where both carriers' End Offices subtend a BA tandem. The
following traffic types will be delivered: (i) Local Traffic or IntraLATA Toll
originated from MGC to such LEC and (ii) Local or IntraLATA Toll Traffic
originated from such LEC and terminated to MGC where BA carries such traffic
pursuant to the Commission's primary toll carrier plan or other similar plan.

                  7.2.2      Subject to Section 7.2.4, the Parties shall
compensate each other for Transit Service as follows:

                  (a         MGC shall pay BA for Local Traffic that MGC
                             originates over the Transit Service at the rate
                             specified in Pricing Schedule plus any additional
                             charges or costs such terminating LEC imposes or
                             levies on

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                             BA for the delivery or termination of such traffic,
                             including any switched access charges; and

                  (b         BA shall pay MGC for Local, InterLATA, or IntraLATA
                             Toll Traffic terminated to MGC from such LEC at the
                             appropriate reciprocal compensation rates described
                             in Section 5.7, InterLATA access rates, or (where
                             BA delivers such traffic pursuant to the
                             Commission's primary toll carrier plan or other
                             similar plan) at MGC's applicable switched access
                             rates or local termination rate, whichever is
                             appropriate.

                  7.2.3 BA expects that all networks involved in Transit traffic
will deliver each call to each involved network with CCS and the appropriate
Transactional Capabilities Application Part ("TCAP") message to facilitate full
interoperability of those CLASS Features supported by BA and billing functions.
In all cases, each Party shall follow the Exchange Message Record ("EMR")
standard and exchange records between the Parties and [?] with the terminating
carrier to facilitate the billing process to the originating network.

                  7.2.4 Each Party shall exercise all reasonable efforts to
enter into a reciprocal local traffic exchange arrangement (either via written
agreement or mutual tariffs) with any wireless carrier, ITC, CLEC or other LEC
to which it sends, or from which it receives, local traffic that transits the
other Party's facilities over Traffic Exchange Trunks. Each Party will, upon
request, provide the other Party with all reasonable cooperation and assistance
in obtaining such arrangements. In addition, neither Party shall take any
actions to prevent the other Party from entering into a direct and reciprocal
local traffic exchange arrangement (either via written agreement or mutual
tariffs) with any wireless carrier, ITC, CLEC, or other LEC to which it sends,
or from which it receives, local traffic that does not utilize the Transit
Service of the first Party. The Parties agree to work cooperatively in
appropriate industry fora to promote the adoption of reasonable industry
guidelines relating to Transit Traffic.

         7.3      911/E911 Arrangements

                  7.3.1 MGC will interconnect to the BA 911/E911 selective
router or 911 Tandem Offices, as appropriate, that serve the areas in which MGC
provides exchange services, for the provision of 911/E911 services and for
access to all sub-tending Public Safety Answering Points ("PSAP"). BA will
provide MGC with the appropriate CLLI codes and specifications of the tandem
serving area.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  7.3.2 Path and route diverse Interconnections for 911/E911
shall be made at the MGC-IP, the BA-IP, or other points as necessary and
mutually agreed, and as required by law or regulation.

                  7.3.3 BA will provide MGC with an electronic interface through
which MGC shall input and provide a daily update of 911/E911 database
information related to appropriate MGC customers. BA will provide, as permitted
by the PSC, MGC with the Master Street Address Guide ("MSAG") so that MGC can
ensure the accuracy of the data transfer. Additionally, BA shall assist MGC in
identifying the appropriate person in each municipality for the purpose of
obtaining the ten-digit Subscriber number of each PSAP.

                  7.3.4 BA and MGC will use their best efforts to facilitate the
prompt, robust, reliable and efficient Interconnection of MGC systems to the
911/E911 platforms.

                  7.3.5 BA and MGC will work cooperatively to arrange meetings
with PSAPs to answer any technical questions the PSAPS, or county or municipal
coordinators may have regarding the 911/E911 arrangements.

                  7.3.6 MGC will compensate BA for connections to its 911/E911
pursuant to Exhibit A.

                  7.3.7 MGC comply with all applicable rules and regulations
pertaining to the provision of 911/E911 services in the State of New York.

8.0      NUMBER RESOURCES, RATE CENTERS AND RATING POINTS

         8.1 Nothing in this Agreement shall be construed to limit or otherwise
adversely affect in any manner either Party's right to employ or to request and
be assigned any Central Office (NXX) Codes pursuant to the Central Office Code
Assignment Guidelines, as may be amended from time to time, or to establish, by
Tariff or otherwise, Rate Centers and Rating Points corresponding to such NXX
codes. Until such time as number administration is provided by a third party, BA
shall provide MGC access to telephone numbers by assigning NXX codes to MGC in
accordance with such Assignment Guidelines.

         8.2 It shall be the responsibility of each Party to program and update
its own switches and network systems in accordance with the Local Exchange
Routing Guide ("LERG") in order to recognize and route traffic to the other
Party's assigned NXX codes at all times. Neither Party

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

shall impose any fees or charges whatsoever on the other Party for such
activities, except as expressly set forth in this Agreement.

         8.3 Unless mandated otherwise by a Commission order, the Rate Center
Areas will be the same for each Party. During the term of this Agreement, MGC
shall adopt the Rate Center Areas and Rate Center Points that the Commission has
approved for BA, in all areas where BA and MGC service areas overlap, and MGC
shall assign whole NPA-NXX codes to each Rate Center unless the LEC industry
adopts alternative methods of utilizing NXXs in the manner adopted by the NANP.

         8.4 MGC will also designate a Rating Point for each assigned NXX code.
MGC shall designate one location for each Rate Center Area as the Rating Point
for the NPA-NXXs associated with that Area and such Rating Point shall be within
the same LATA as the Rate Center Area but not necessarily within the Rate Center
Area itself

         8.5 Notwithstanding anything to the contrary contained herein, nothing
in this Agreement is intended to, and nothing, in this Agreement shall be
construed to, in any way constrain MGC's choices regarding the size of the local
calling area(s) that MGC may establish for its Customers, which local calling
areas may be larger than, smaller than, or identical to, BA's local calling
areas.

9.0      NETWORK MAINTENANCE AND MANAGEMENT; OUTAGES

         9.1      Cooperation

         The Parties will work cooperatively to install and maintain a reliable
network. MGC and BA will exchange appropriate information (e.g., maintenance
contact numbers, escalation procedures, network information, information
required to comply with law enforcement and other security agencies of the
Government) to achieve this desired reliability. In addition, the Parties will
work cooperatively to apply sound network management principles to alleviate or
to prevent congestion.

         9.2      Responsibility for Following Standards

         Each Party recognizes a responsibility to follow the standards that may
be agreed to between the Parties and to employ characteristics and methods of
operation that will not interfere

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

with or impair the service or any facilities of the other or any third parties
connected with or involved directly in the network of the other.

         9.3      Interference or Impairment

         If Bell Atlantic reasonably determines that the characteristics and
methods of operation used by MGC will or may interfere with or impair its
provision of services, BA shall have the right to discontinue service subject,
however, to the following:

                  9.3.1 BA shall have given MGC at least ten (10) days' prior
written notice of the interference or impairment or potential interference or
impairment and the need to correct the condition within said time period.

                  9.3.2 BA shall have concurrently provided a copy of the notice
provided to MGC under (9.3.1) above to the appropriate federal and/or state
regulatory bodies.

                  9.3.3 Notice in accord with subsections 9.3.1 and 9.3.2 above
shall not be required in emergencies and BA may immediately discontinue service
if reasonably necessary to meet its obligations. In such case, however, BA shall
use all reasonable means to notify MGC and the appropriate federal and/or state
regulatory bodies.

                  9.3.4 Upon correction of the interference or impairment, BA
will promptly renew service to MGC. During such period of discontinuance, there
will be no compensation or credit allowance by BA to MGC for interruptions.

         9.4      Repeated or Willful Noncompliance

         The Interconnection, unbundled Network Elements, and services provided
hereunder may be discontinued by either Party upon thirty (30) days' written
notice to the other for repeated or willful violation of and/or a refusal to
comply with this Agreement in any material respect. The Party discontinuing will
notify the appropriate federal and/or state regulatory bodies concurrently with
the notice to the other Party of the prospective discontinuance.

         9.5      Outage Repair Standard

         In the event of an outage or trouble in any arrangement, facility, or
service being provided by a Party hereunder, the providing Party will follow
procedures for isolating and clearing the outage or trouble that are no less
favorable than those that apply to comparable arrangements,

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

facilities, or services being provided by the providing Party to any other
carrier whose network is connected to that of the providing Party. MGC and BA
may agree to modify those procedures from time to time based on their experience
with comparable Interconnection arrangements with other carriers.

         9.6      Notice of Changes -- Section 251(c)(5)

         If a Party makes a change in the information necessary for the
transmission and routing of services using that Party's network, or any other
change in its network which it believes will materially affect the
inter-operability of its network with the other Party's network, the Party
making the change shall provide at least ninety (90) days' advance written
notice of such change to the other Party. In addition, the Parties will comply
with the Network Disclosure rules adopted by the FCC in CC Docket No. 86-79 as
may be amended from time to time.

         9.7      Fraud

         The Parties shall work cooperatively to minimize fraud associated with
third-number billed calls, calling card calls, and any other services related to
this Agreement.

10.0     JOINT NETWORK CONFIGURATION AND GROOMING PROCESS; AND INSTALLATION,
         MAINTENANCE, TESTING AND REPAIR.

         10.1     Joint Network Configuration and Grooming Process

         Upon request of either Party, the Parties shall jointly develop an
implementation and grooming process (the "Joint Grooming Process" or "Joint
Process") which may define and detail, inter alia,

         (a       agreement on Physical Architecture consistent with the
                  guidelines defined in Section 4.0;

         (b       standards to ensure that Interconnection trunk groups
                  experience a grade of service, availability and quality which
                  is comparable to that achieved on interoffice trunks within
                  BA's network and in accord with all appropriate relevant
                  industry-accepted quality, reliability and availability
                  standards;

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         (c       the respective duties and responsibilities of the Parties with
                  respect to the administration and maintenance of the trunk
                  groups, including but not limited to standards and procedures
                  for notification and discoveries of trunk disconnects;

         (d       disaster recovery provision escalations;

         (e       additional technically feasible IP(s) in a LATA as provided in
                  Section 4.0 above; and

         (f       such other matters as the Parties may agree, including, e.g.,
                  End Office to End Office high usage trunks as good engineering
                  practices may dictate.

The initial mutual Interconnection is not dependent upon completion of the Joint
Grooming Process.

         10.2     Installation, Maintenance, Testing and Repair

         Unless otherwise agreed to by the Parties, Interconnection shall be
provided at parity. For purposes of this Agreement, a Party's obligation to
provide parity shall be in accordance with Applicable Laws. If either Party is
unable to fulfill its obligations under this subsection 10.2, it shall notify
the other Party of its inability to do so and will negotiate alternative
intervals in good faith. The Parties agree that the standards to be used by each
Party for isolating and clearing any disconnections and/or other outages or
troubles shall be at parity.

         10.3     Network Reliability Council

         The Parties will carefully review the Network Reliability Council's
recommendations and, as part of the Joint Grooming Plan, implement such
recommendations where technically and economically feasible pursuant to the
NYPSC Order in Case 96-C-0917, released December 2, 1996.

         10.4     Forecasting, Requirements for Trunk Provisioning

         Within ninety (90) days of executing this Agreement, each Party shall
provide the other Party a one (1) year traffic forecast. This initial forecast
will provide the amount of traffic to be delivered to BA over each of the
Traffic Exchange Trunk groups over the next four (4) quarters. The forecast
shall be updated and provided to BA on an as-needed but no less frequently than

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

quarterly. All forecasts shall include Access Carrier Terminal Location (ACTL),
traffic type (local/toll, operator services, 911, etc.), code (identifies trunk
group), A locations/Z location (CLLI codes for MGC-IPs and BA-IPs, interface
type (e.g., DS1), and trunks in service each year (cumulative).

                  10.4.1 Trunk Provisioning Pursuant to Forecasts. Because BA's
trunking requirements will be dependent on the Customer segments and service
segments within Customer segments to whom MGC decides to market its services, BA
will be dependent on MGC to provide accurate trunk forecasts for both inbound
(from BA) and outbound (from MGC) traffic. BA will, as an initial matter and
upon request, provide the same number of trunks to terminate local traffic to
MGC as MGC provides to terminate local traffic to BA, unless MGC expressly
identifies particular situations that are expected to produce traffic that is
substantially skewed in either the inbound or outbound direction, in which case
BA will provide the number of trunks MGC suggests; provided, however, that in
all cases BA's provision of the forecasted number of trunks to MGC is
conditioned on the following: that such forecast is based on reasonable
engineering criteria, there are no capacity constraints, and MGC's previous
forecasts have proven to be reliable and accurate.

                  10.4.2 Monitoring and Adjusting Forecasts. BA will, for ninety
(90) days, monitor traffic on each trunk group that it establishes at MGC's
suggestion or request pursuant to the procedures identified in subsection 10.4.1
above. At the end of such ninety (90) day period, BA may disconnect trunks that,
based on reasonable engineering criteria and capacity constraints, are not
warranted by the actual traffic volume experienced. If, after such initial
ninety (90) day period for a trunk group, BA determines that any trunks in the
trunk group in excess of four (4) DS-1s are not warranted by actual traffic
volumes (considering engineering criteria for busy hour CCS and blocking,
percentages), then BA may hold MGC financially responsible for the excess
facilities. In subsequent periods, BA may also monitor traffic for ninety (90)
days on additional trunk groups that MGC suggests or requests BA to establish.
If, after any such (90) day period, BA determines that any trunks in the trunk
group are not warranted by actual traffic volumes (considering engineering
criteria for busy hour call seconds and blocking, percentages), then BA may hold
MGC financially responsible for the excess facilities. At any time during the
relevant ninety (90) day period, MGC may request that BA disconnect trunks to
meet a revised forecast. In such instances, BA may hold MGC financially
responsible for the disconnected trunks retroactive to the start of the ninety
(90) day period through the date such trunks are disconnected.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  10.4.3  Reciprocal Responsibility. To the extent that BA
requires MGC to install trunks for delivery of traffic to BA, MGC may apply the
same procedures with respect to BA's trunking requirements.

         10.5     Demand Management Forecasts

                  10.5.1 MGC will furnish BA with good faith demand management
forecasts to enable BA to effectively plan its network infrastructure and work
force levels to accommodate anticipated MGC demand for BA services and products.
Such forecasts will describe MGC's expected needs for service volumes, and
timeframes for service deployment, by wire center. MGC agrees to provide such
forecasts to BA thirty (30) days following the Effective Date, with updates to
follow every six months thereafter. BA agrees that such forecasts shall be
subject to the confidentiality provisions defined in subsection 29.4 below, and
that such Information will only be used by BA to provide Interconnection
pursuant to this Agreement.

11.0     UNBUNDLED ACCESS -- SECTION 251(c)(3)

         To the extent required of each Party by Section 251 of the Act, each
Party shall offer to the other Party nondiscriminatory access to Network
Elements on an unbundled basis at any technically feasible point. BA shall
unbundle and separately price and offer Network Elements such that MGC will be
able to lease and interconnect to whichever of the Network Elements MGC
requires, and to allow MGC to combine the BA-provided elements with any
facilities and services that MGC may itself provide, except that MGC shall not
recombine Network Elements purchased from BA for use as a substitute for the
purchase at wholesale rates of Telecommunications Services that BA provides
unless otherwise mandated by the FCC or the Commission or agreed to by BA with
other carriers. Any combination by MGC of unbundled Network Elements purchased
from BA shall be through a Collocation arrangement pursuant to Section 13.0.

         11.1     Available Network Elements

         At the request of MGC, BA shall provide MGC access to the following
unbundled Network Elements in accordance with the requirements of the FCC
Regulations:

                  11.1.1     Local Loops, as set forth in subsection 11.2;

                  11.1.2     The Network Interface Device;

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  11.1.3     Switching Capability, as set forth in subsection
                             11.3;

                  11.1.4     Interoffice Transmission Facilities, as set forth
                             in subsection 11.4;

                  11.1.5     Signaling Links and Call-Related Databases, as set
                             forth in subsection 5.4 and Section 17;

                  11.1.6     Operations Support Systems, as set forth in
                             subsection 11.5:

                  11.1.7     Operator Services and Direction, Assistance, as set
                             forth in Section 19;
and

                  11.1.8     such other Network Elements in accordance with
                             subsection 11.7 below.

         11.2     Unbundled Local Loop ("ULL") Types

         Subject to subsection 11.7, BA shall allow MGC to access the following
Unbundled Local Loop ("ULL") types unbundled from local switching and local
transport in accordance with the terms and conditions set forth in this
subsection 11.2.

                  11.2.1 "2-Wire Analog Voice Grade ULL" or "Analog 2W" which
support analog transmission of 300-3000 Hz, repeat link start, link reverse
battery, or ground start seizure and disconnect in one direction (toward the End
Office Switch), and repeat ringing in the other direction (toward the Customer).
Analog 2W include Loops sufficient for the provision of PBX trunks, pay
telephone lines and electronic key system lines.

                  11.2.2 "4-Wire Analog, Voice Grade ULL" or "Analog 4W" which
support transmission of voice grade signals using separate transmit and receive
paths and terminate in a 4-wire electrical interface.

                  11.2.3 "2-Wire ISDN Digital Grade ULL" or "BRI ISDN" (Premium
Link) which support digital transmission of two 64 Kbps bearer channels and one
16 Kbps data channel. BRI ISDN is a 2B+D Basic Rate Interface-Integrated
Services Digital Network (BRI-ISDN) Loop which will meet national ISDN standards
and conform to ANSI T1.601-1992 & TlEl.4 90-004R3).

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  11.2.4 2-Wire ADSL-Compatible ULL or ADSL 2W is a 2-wire,
non-loaded, twisted copper pair that meets revised resistance design or carrier
serving area design guidelines. The upstream and downstream ADSL power spectral
density masks and dc line power limits in BA TR 72575, Issue 2 must be met.
ADSL-compatible local loops are subject to availability.

                  11.2.5 2-Wire HDSL-Compatible ULL or HDSL 2W consists of a
single 2-wire, non-loaded, twisted copper pair that meets the carrier serving
area design criteria. The HDSL power spectral density mask and dc line power
limits referenced in BA TR 72575, Issue 2 must be met. 2-Wire HDSL-compatible
local loops are subject to availability.

                  11.2.6 4-Wire HDSL-Compatible ULL or HDSL 4W consists of two
2-wire, non-loaded, twisted copper pairs that meet the carrier serving area
design criteria. The HDSL power spectral density mask and dc line power limits
referenced in BA TR 72575, Issue 2 must be met. 4-Wire HDSL-compatible local
loops are subject to availability.

                  11.2.7 "4-Wire DS-1-compatible ULL" (Digital Grade Loop)
provides a channel which provides 1.544 Mbps digital transmission path between a
Customer premises and a MGC Collocation node at a BA central office, and is
capable of operating in a full duplex, time division (digital) multiplexing
mode. A DS-1 Digital Grade Loop provides transmission capacity equivalent to 24
voice grade channels with associated signaling, twenty-four 56 Kbps digital
channels when in band signaling is provided or twenty-four 64 Kbps channels with
the selection of the Clear Channel signaling option.

                  11.2.8 BA will make Analog 2-Wire ULLS, BRI ISDN ULLS, Analog
4-Wire ULLs and 4-Wire DS-1-compatible ULLs available for purchase by MGC at any
time after the Effective Date.

                  11.2.9 BA will make HDSL 4-Wire, HDSL 2-Wire, and ADSL 2-Wire
ULLs available to MGC no later than the date on which it makes such ULLs
commercially available to any other Telecommunications Carrier in New York
State. The Parties shall amend Exhibit A to add the appropriate rates and
charges.

         11.3     Unbundled Switching Elements

         BA shall make available to MGC the local Switching Element and tandem
Switching Element unbundled from transport, local loop transmission, or other
services in accordance with

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

the terms and conditions of and at the rates specified in BA's New York PSC No.
916 Tariff, as amended from time to time.

         11.4     Unbundled Inter Office Facilities

         BA shall provide MGC Inter Office Facilities ("IOF"), unbundled from
switching, unbundled interoffice facilities, and other services as required by
Applicable Law, at the rates, terms and conditions set forth in BA's NYPSC No.
916 Tariff, as amended from time to time.

         11.5     Operations Support Systems

         BA shall provide MGC with access via electronic interfaces to databases
required for pre-ordering, ordering, provisioning, maintenance and repair, and
billing as soon as practicable.

         11.6     Limitations on Unbundled Access

                  11.6.1 BA shall only be required to provide ULLs and Ports
where such Loops and Ports are available.

                  11.6.2 MGC shall access BA's unbundled Network Elements
specifically identified in this Agreement via Collocation in accordance with
Section 13 at the BA Wire Center where those elements exist, and each ULL or
Port shall, in the case of Collocation, be delivered to MGC's Collocation node
by means of a Cross Connection or Strapping.

                  11.6.3 BA shall provide MGC access to its Unbundled Local
Loops at each of BA's Wire Centers for loops terminating in that Wire Center. In
addition, if MGC orders one or more ULL provisioned via Integrated Digital Link
Carrier or Remote Switching technology deployed as a ULL concentrator, BA shall,
where available, move the requested ULL(s) to a spare, existing physical ULL at
no additional charge to MGC. If, however, no spare physical ULL is available, BA
shall within three (3) Business days of MGC's request notify MGC of the lack of
available facilities. MGC may then at its discretion make a Network Element Bona
Fide Request to BA to provide the unbundled Local Loop through the
demultiplexing of the integrated digitized ULL(s). MGC may also make a Network
Element Bona Fide Request for access to Unbundled Local Loops at the ULL
concentration site point. Notwithstanding anything to the contrary in this
Agreement, standard provisioning intervals shall not apply to ULL provided under
this subsection 11.6.3.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  11.6.4 If MGC orders a ULL type and the distance requested on
such ULL exceeds the transmission characteristics in applicable technical
references, as specified below, distance extensions may be required and
additional rates and charges shall apply as set forth in Exhibit A or applicable
Tariffs.

           Loop Type                          Technical Reference/Limitation
           Electronic Key Line                2.5 miles
           ISDN                               Bellcore TA-NWT-000393
           HDSL 2W                            T1E1 Technical Report Number 28
           HDSL 4W                            T1E1 Technical Report Number 2S
           ADSL 2W                            ANSI T1.413 1995 Specification

         11.7     Availability of Other Network Elements on an Unbundled Basis

                  11.7.1 BA shall, upon request of MGC, and to the extent
required by Applicable Law, provide to MGC access to its Network Elements on an
unbundled basis for the provision of MGC's Telecommunications Service. Any
request by MGC for access to a BA Network Element that is not already available
shall be treated as a Network Element Bona Fide Request. MGC shall provide BA
access to its Network Elements as mutually agreed by the Parties or as required
by Applicable Laws.

                  11.7.2 A Network Element obtained by one Party from the other
Party under this subsection 11.7 may be used in combination with the facilities
of the requesting Party only to provide a Telecommunications Service, including
obtaining billing and collection, transmission, and routing of the
Telecommunications Service.

                  11.7.3 Notwithstanding anything to the contrary in this
subsection 11.7, a Party shall not be required to provide a proprietary Network
Element to the other Party under this subsection 11.7 except as required by the
Commission or FCC.

         11.8     Provisioning of Unbundled Local Loops

         The following coordination procedures shall apply for conversions of
"live" Telephone Exchange Services to Unbundled Local Loops (also referred to as
"hot cuts"). These and other mutually agreed-upon procedures shall apply
reciprocally for the "live" cutover of Customers from BA to MGC and from MGC to
BA.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  11.8.1 MGC shall request ULLs from BA by delivering to BA a
valid electronic transmittal Service Order using the BA electronic ordering
platform or another mutually agreed upon system. Within two (2) business days of
BA's receipt of such valid Service Order, BA shall provide MGC the firm order
commitment ("FOC") date by which the Loop(s) covered by such Service Order will
be installed.

                  11.8.2  BA agrees to accept from MGC at the time the service
request is submitted for scheduled conversion of hot cut ULL orders, a desired
date and A.M. or P.M. designation (the "Scheduled Conversion Time") to the
extent available (as applicable, the "Conversion Window") for the hot cut.

                  11.8.3 BA shall test for MGC dial tone at the POT bay by
testing through the tie cable provisioned between the BA main distributing frame
and the MGC expanded Inter-connection node forty-eight (48) hours prior to the
Scheduled Conversion Time.

                  11.8.4 Not less than one hour prior to the Scheduled
Conversion Time, either Party may contact the other Party and unilaterally
designate a new Scheduled Conversion Time (the "New Conversion Time"). If the
New Conversion Time is within the Conversion Window, no charges shall be
assessed on or waived by either Party. If, however, the New Conversion Time is
outside of the Conversion Window, the Party requesting such New Conversion Time
shall be subject to the following:

                  If BA requests the New Conversion Time, the applicable Line
                  Connection Charge shall be waived; and

                  If MGC requests the New Conversion Time, MGC shall be assessed
                  a Line Connection Charge in addition to the Line Connection
                  Charge that will be incurred for the New Conversion Time.

                  11.8.5 Except as otherwise agreed by the Parties for a
specific conversion such as large cutovers of ten (10) lines or more that have
been negotiated, the Parties agree that the time interval expected from
disconnection of BA's "live" Telephone Exchange Service to the connection of an
unbundled Network Element at the MGC Collocation node will be accomplished
within a window of time of sixty (60) minutes or less. If MGC has ordered INP
with the installation of a Loop, BA will coordinate the implementation of INP
with the Loop conversion during with the above stated intervals at no additional
charge.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  11.8.6 If MGC requests or approves a BA technician to perform
services in excess of or not otherwise contemplated by the Line Connection
Service Charge BA may Charge MGC for any additional and reasonable labor charges
to perform such services.

                  11.8.7 If as the result of end user actions (e.g. Customer not
ready ["CNR"]), BA cannot complete requested work activity when technician has
been dispatched to the site, MGC will be assessed a non-recurring charge
associated with this visit. This charge will be the sum of the Service Order
Charge and Premises Visit Charge as specified in the NYPSC Tariffs Nos. 900/914.

         11.9     Maintenance of Unbundled Network Elements

         If (i) MGC reports to BA a Customer trouble, (ii) MGC requests a
dispatch, (iii) BA dispatches a technician, and (iv) such trouble was not caused
by BA facilities or equipment in whole or in part, then MGC shall pay BA a
charge set forth in Exhibit A for time associated with said dispatch. In
addition, this charge also applies when the Customer contact as designated by
MGC is not available at the appointed time. MGC accepts responsibility for
initial trouble isolation and providing BA with appropriate dispatch information
based on its test results. If as the result of MGC instructions, BA is
erroneously requested to dispatch within a BA Central Office or to a POT Bav
("dispatch in"), a charge set forth in Exhibit A will be assessed per occurrence
to MGC by BA. If as the result of MGC instructions, BA is erroneously requested
to dispatch outside a BA Central Office or to a POT Bay ("dispatch out"), a
charge set forth in Exhibit A will be assessed per occurrence to MGC by BA. BA
agrees to respond to MGC trouble reports on a non-discriminatory basis
consistent with the manner in which it provides service to its own retail
customers or to any other similarly initiated Telecommunications Carrier.

         11.10    Other Terms and Conditions Including Rates and Charges

                  11.10.1 ULLs and other Network Elements will be offered on the
terms and conditions, including rates and charges, specified herein and on such
other terms as stated in applicable Tariffs, as amended from time to time, that
are not inconsistent with the terms and conditions set forth herein.

                  11.10.2 BA shall charge the non-recurring and monthly
recurring, rates for ULLs and other Network Elements set forth in Exhibit A as
interim rates until such time as the Commission adopts permanent rates
consistent with the requirements of the FCC Regulations.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

Such permanent rates shall be applied in the manner described in Exhibit A and
subsection 20.1.2 below.

12.0     RESALE-- SECTIONS 251(c)(4) and 251(b)(1)

         12.1     Availability of Wholesale Rates for Resale

         BA shall make available to MGC for resale all Telecommunications
Services as described in Section 251(c)(4) of the Act, pursuant to the rates,
terms and conditions of BA's NYPSC No. 915 tariff, as may be amended from time
to time.

         12.2     Availability of Retail Rates for Resale

         Each Party shall make available its Telecommunications Services for
resale at the retail rates set forth in its Tariffs to the other Party in
accordance with Section 251 (b)(1) of the Act. In addition, BA and MGC shall
each allow the resale by the other of all Telecommunications Services that are
offered primarily or entirely to other Telecommunications Carriers (e.g.
Switched and special Exchange Access Services) at the rates already applicable
to such services. BA shall also allow the resale by MGC of such other
non-Telecommunications Services as BA, in its sole discretion, determines to
provide for resale under terms and conditions to be agreed to by the Parties.

         12.3     Additional Terms Governing Resale and Use of BA Services

                  12.3.1 MGC shall comply with the provisions of this Agreement
(including, but not limited to, all applicable BA Tariffs) regarding resale or
use of BA services. In addition, MGC shall undertake in good faith to ensure
that its Customers comply with the provisions of BA's Tariffs applicable to
their use of BA's Telecommunications Services.

                  12.3.2 Without in any way limiting subsection 12.3.1, MGC
shall not resell (a) residential service to business or other nonresidential
Customers of MGC, (b) Lifeline or other means-tested service offerings, or
grandfathered service offerings, to persons not eligible to subscribe to such
service offerings from BA, or (c) any other BA service in violation of any user
or user group restriction that may be contained in the BA Tariff applicable to
such service to the extent such restriction is not prohibited by Applicable
Laws. In addition, MGC shall be subject to the same limitations that BA's own
retail Customers may be subject to with respect to any Telecommunications
Service that BA may, in its discretion and to the extent not prohibited by
Applicable Law, discontinue offering.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  12.3.3 BA shall not be obligated to offer to MGC at a
wholesale discount Telecommunications Services that BA offers at a special
promotional rate if such promotions are for a limited duration of ninety (90)
days or less.

                  12.3.4 Upon request by BA, MGC shall provide to BA adequate
assurance of payment of charges due to BA in connection with MGC's purchase of
BA services for resale. Assurance of payment of charges may be requested by BA:
if MGC (a) in BA's reasonable judgment, at the Effective Date or at any time
thereafter, is unable to show itself to be creditworthy; (b) in BA's reasonable
judgment, at the Effective Date or at any time thereafter, is not creditworthy;
or, (c) fails to timely pay a bill rendered to MGC by BA. Unless otherwise
agreed by the Parties, the assurance of payment shall be in the form of a cash
deposit and shall be in an amount equal to the charges for BA services that MGC
may reasonably be expected to incur during, a period of two (2) months. BA may
at any time use the deposit or other assurance of payment to pay amounts due
from MGC.

                  12.3.5 MGC shall not be eligible to participate in any BA plan
or program under which BA end user retail Customers may obtain products or
merchandise, or services which are not BA Retail Telecommunications Services, in
return for trying, agreeing to purchase, purchasing, or using BA Retail
Telecommunications Services.

                  12.3.6 BA may impose additional restrictions on MGC's resale
of BA's retail Telecommunications Services to the extent permitted by Applicable
Laws.

13.0     COLLOCATION -- SECTION 251(c)(6)

         13.1 BA shall offer to MGC Physical Collocation of equipment necessary
for Interconnection (pursuant to Section 4.0) or for access to unbundled Network
Elements (pursuant to Section 11.0), except that BA may offer only Virtual
Collocation if BA demonstrates to the Commission that Physical Collocation is
not practical for technical reasons or because of space limitations, as provided
in Section 251 (c)(6) of the Act. BA shall provide Collocation solely for the
purpose of Interconnection with facilities or services of BA or access to
unbundled Network Elements of BA, except as otherwise mutually agreed to in
writing by the Parties or as required by the FCC or the Commission, subject to
applicable federal and state Tariffs and license agreements.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         13.2 MGC agrees to offer to BA Collocation of equipment for purposes of
Interconnection (pursuant to Section 4) on a non-discriminatory basis and at
comparable rates, terms and conditions as MGC may provide to other third
parties. MGC shall provide such collocation subject to applicable Tariffs.

         13.3     In the course of implementation of a Collocation project, BA
shall:

                  (a         identify the Collocation project manager assigned
                             to the project;

                  (b         develop a written comprehensive "critical tasks"
                             timeline detailing the work (and relative sequence
                             thereof) that is to be performed by each Party or
                             jointly by both Parties; and

                  (c         provide MGC with the relevant engineering,
                             requirements.

         13.4 The Collocating Party shall purchase Cross Connection to services
or facilities as described in applicable Tariffs.

         13.5 Collocation shall occur under the terms of each Party's applicable
and available Tariffs, except that MGC reserves the right to collocate Remote
Switching Concentrators ("RSCs") only to the extent that any and all switching
functionality of such equipment has been rendered inoperative and constitutes
equipment that is used solely for the purpose of interconnection and access to
unbundled network elements to provide Telephone Exchange Service to its end user
customer(s). MGC recognizes and agrees that BA shall only be required to provide
an environment suitable for placement of toll transmission equipment ("Toll
Transmission Environment"). If, pursuant to Applicable Law, BA is required at
any future time to provide other than a Toll Transmission Environment, then MGC
shall pay all additional costs incurred by BA to provide such an environment.

         13.6     Dedicated Transit Service

                  13.6.1 "Dedicated Transit Service" provides for the dedicated
connection between a MGC Collocation arrangement established pursuant to
applicable tariffs and/or license agreements at a BA premises and a Collocation
arrangement of a third Party carrier that maintains a Collocation arrangement at
the same premises. Dedicated Transit Service shall be provided using a
cross-connection (dedicated connection) using suitable BA -provided cable or
transmission facilities or any other mutually agreed upon arrangement.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  13.6.2 The carrier that requests the Dedicated Transit Service
shall be the customer of record for both ends of the service in terms of
ordering, provisioning, maintenance, and billing. Alternative arrangements may
be utilized if agreed upon by all three parties. Rates and charges for Dedicated
Transit Service are stated in Exhibit A.

SECTION 251(b) PROVISIONS

14.0     NUMBER PORTABILITY -- SECTION 251(b)(2)

         14.1     Scope

                  14.1.1 The Parties shall provide Number Portability on a
reciprocal basis to each other to the extent technically feasible, and in
accordance with rules and regulations as from time to time prescribed by the FCC
and/or the Commission. The Parties shall provide Number Portability to each
other in the event a Customer of one Party ("Party A") elects to become a
Customer of the other Party ("Party B") and the Customer (i) remains within the
same central office district and within the boundary of the smallest
geographical area that is significant for billing (e.g. exchange zone) as
defined by the LEC to whom the ported Customer's NXX code was originally
assigned and (ii) elects to utilize the original telephone number(s)
correspondent to the Exchange Service(s) it previously received from Party A in
conjunction with the Exchange Service(s) it will now receive from Party B.

                  14.1.2 Until Permanent Number Portability is implemented by
the industry pursuant to regulations issued by the FCC and/or the Commission,
the Parties agree to reciprocally provide Interim Number Portability ("INP") to
each other at the prices listed in Exhibit A. Such agreed-upon prices for INP
are not intended to reflect either Party's views on the cost recovery mechanisms
being considered by the FCC in its current proceeding on number portability
issues.

                  14.1.3 Upon the agreement of the Parties or issuance of
applicable FCC and/or Commission order(s) or regulations mandating the adoption
of a Permanent Number Portability ("PNP") arrangement, BA and MGC will commence
migration from INP to the agreed-upon or mandated PNP arrangement as quickly as
practically possible while minimizing interruption or degradation of service to
their respective Customers. Once Permanent Number Portability is implemented,
either Party may withdraw, at any time and at its sole discretion, its INP
offerings, subject to advance notice to the other Party and coordination to
allow the seamless and

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

transparent conversion of INTP Customer numbers to Permanent Number Portability.
Upon implementation of Permanent Number Portability pursuant to FCC or
Commission regulation, both Parties agree to conform and provide such Permanent
Number Portability. To the extent PNP rates or cost recovery mechanisms are not
established by the applicable FCC or Commission order or regulation mandating
the adoption of PNP, the Parties will negotiate in good faith the charges or
cost recovery mechanism for PNP service at such time as a PNP arrangement is
adopted by the Parties.

                  14.1.4 Under either an INP or PNP arrangement, MGC and BA will
implement a process to coordinate Number Portability cutovers with ULL
conversions (as described in Section 11 of this Agreement).

         14.2     Procedures for Providing INP Through Remote Call Forwarding

         MGC and BA will provide INIP through Remote Call Forwarding as follows:

                  14.2.1 A Customer of one Party ("Party A") elects to become a
Customer of the other Party ("Party B"). The Customer elects to utilize the
original telephone number(s) corresponding to the Telephone Exchange Service(s)
it previously received from Party A, in conjunction with the Telephone Exchange
Service(s) it will now receive from Party B. Upon receipt of confirmation of a
signed letter of agency ("LOA") from the Customer (and an associated service
order) assigning the number to Party B, Party A will implement an arrangement
whereby all calls to the original telephone number(s) will be forwarded to a new
telephone number(s) designated by Party B, only within the same Exchange Area as
the original telephone number(s). It is Party B's responsibility to maintain a
file of all LOAs and Party A may request, upon reasonable notice, a copy of the
LOA. Party A will route the forwarded traffic to Party B over the appropriate
Telephone Exchange Service Trunks as if the call had originated on Party A's
network.

                  14.2.2 Party B will become the customer of record for the
original Party A telephone numbers subject to the INP arrangements. Party A
shall use its reasonable efforts to consolidate into as few billing statements
as possible all collect, calling card, and 3rd-number billed calls associated
with those numbers, with sub-account detail by retained number. Such billing
statement shall be delivered to Party B in a mutually agreed-upon format via
either electronic file transfer, magnetic tape, or other mutually acceptable
medium.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  14.2.3 Party A will update its Line Information Database
("LIDB") listings for retained numbers, with the screening options provided by
Party B on a per order basis. Party B shall determine which of the screening
options offered by Party A should apply to the Party B Customer account. Party A
will cancel calling cards associated with those forwarded numbers assigned to
Party B.

                  14.2.4 Party B will outpulse the telephone number to which the
call has been forwarded to the 911 Tandem Office. Party B will also provide the
911 database with both the forwarded number and the directory number, as well as
the appropriate address information of the Customer.

                  14.2.5 Within two (2) business days of receiving notification
from the Customer, Party B shall notify Party A of the Customer's termination of
service with Party B, and shall further notify Party A as to that Customer's
instructions regarding its telephone number(s). Party A will reinstate service
to that Customer, cancel the INIP arrangements for that Customer's telephone
number(s), or redirect the INP arrangement to another INP-participating LEC
pursuant to the Customer's instructions at the time.

                  14.2.6 Party A shall be permitted to cancel INP arrangements
and reassign the telephone number(s) upon receipt of notification from Party B
or a third party that is authorized to act on behalf of the Customer. The
Parties agree to work cooperatively to develop procedures or adopt industry
standards or practices concerning the initiation and termination of INP service
in a multicarrier environment.

         14.3     Procedures for Providing INP Through Route Indexing

         Upon mutual agreement, BA will deploy a Route Index arrangement which
combines direct trunks, provisioned between BA's and MGC's end offices, with
trunk side routing translations and full functionality for those CLASS services
deployed in the specific BA switch. Under this arrangement, inbound calls to a
ported number will be pointed at a route index that sends the call to a
dedicated trunk group, built as a direct final, for the sole purpose of
facilitating completion of calls to a ported number. BA will coordinate with MGC
to provide this solution in a mutually agreeable and administratively manageable
manner (e.g. NXX level) so as to minimize switch resource utilization for both
Parties.

         14.4     Procedures for Providing INP Through Full NXX Code Migration

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         Where either Party has activated an entire NXX for a single Customer,
or activated at least eighty percent (80%) of an NXX for a single Customer, with
the remaining numbers in that NXX either reserved for future use by that
Customer or otherwise unused, if such Customer chooses to receive Telephone
Exchange Service from the other Party, the first Party shall cooperate with the
second Party to have the entire NXX reassigned in the LERG (and associated
industry databases, routing tables, etc.) to an End Office operated by the
second Party. Such transfer will be accomplished with appropriate coordination
between the Parties and subject to appropriate industry lead-times for movements
of NXXs from one switch to another. Neither Party shall charge the other in
connection with this coordinated transfer.

         14.5     Other Interim Number Portability Options

         MGC may also request Direct Inward Dial Trunks pursuant to applicable
tariffs.

         14.6     Receipt of Terminating Compensation on Traffic to INP'ed
Numbers

         The Parties agree in principle that, under the INP arrangements
described in subsections 14.2 and 14.3 above, terminating compensation on calls
to INP'ed numbers should be received by each Customer's chosen LEC as if each
call to the Customer had been originally addressed by the caller to a telephone
number bearing an NPA-NXX directly assigned to the Customer's chosen LEC. In
order to accomplish this objective where INP is employed, the Parties shall
utilize the process set forth in this subsection 14.6 thereby terminating
compensation on calls subject to INP will be passed from the Party (the
"Performing Party") which performs the INP to the other Party (the "Receiving
Party") for whose Customer the INP is provided.

                  14.6.1 The Parties shall individually and collectively make
best efforts to track and quantify INIP traffic between their networks based on
the CPN of each call by identifying CPNs which are INP'ed numbers. The Receiving
Party shall charge the Performing Party for each minute of INP traffic at the
INP Traffic Rate specified in subsection 14.6.3 in lieu of any other
compensation charges for terminating such traffic, except as provided in
subsection 14.6.2.

                  14.6.2 By the Interconnection Activation Date in each LATA,
the Parties shall jointly estimate for the prospective six months, based on
historic data of all traffic in the LATA, the percentages of such traffic that,
if dialed to telephone numbers bearing NPA-NXXs directly assigned to a Receiving
Party (as opposed to the INP'ed number), would have been subject to (i)
Reciprocal Compensation ("Recip Traffic"), (ii) appropriate intrastate FGD
charges ("Intra Traffic"), (iii) interstate FGD charges ("Inter Traffic"), or
(iv) handling, as Transit Traffic. On

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

the date which is six (6) months after the Interconnection Activation Date, and
thereafter on each succeeding six month anniversary of such Interconnection
Activation Date, the Parties shall establish new INIP traffic percentages to be
applied in the prospective six (6) month period, based on the Performing Party's
choice of actual INP traffic percentages from the preceding six (6) month period
or historic data of all traffic in the LATA.

                  14.6.3     The INP Traffic Rate shall be equal to the sum of:

       (Recip Traffic percentage times the Reciprocal Compensation Rate
                                 -----
                            set forth in Exhibit A)
                                     plus
                                     ----
         (Intra Traffic percentage times Receiving Party's effective
                                   -----
                             intrastate FGD rates)
                                     plus
                                     ----
          (Inter Traffic percentage times Receiving Party's effective
                                    -----
                            interstate FGD rates).

         14.7     Recovery of INP Costs Pursuant to FCC Order and Rulemaking

         Notwithstanding anything to the contrary contained in this Section 14,
in light of the FCC's First Report and Order and Further Notice of Proposed
Rulemaking, adopted June 27, 1996, in CC Docket 95-116 (the "Order"), the
Parties stipulate and agree as follows:

                  14.7.1 The rates listed in Exhibit A for the provision of INP
are appropriate amounts that each Party providing INP service should recover for
the provision of those INP functionalities in BA's operating territory on an
interim basis until the Commission mandates an alternative cost recovery
mechanism for the provision of INP. For the INP functions it provides, each
Party should be allowed to recover these amounts in a manner consistent with any
final FCC and/or Commission order on INP cost recovery (such as a state-wide
fund contributed to by all telecommunications carriers).

                  14.7.2 The Parties agree that neither Party waives its rights
to advocate its views that are consistent with this subsection 14.7 on the
appropriate INP cost recovery mechanism, or to present such views before any
relevant regulatory body or other agency as they relate to FCC or Commission
actions on INP cost recovery.

15.0     DIALING PARITY -- SECTION 251(b)(3)

         BA and MGC shall each provide the other with nondiscriminatory access
to such services and information as are necessary to allow the other Party to
implement Dialing Parity for

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

Telephone Exchange Service, operator services, directory assistance, and
directory listing information with no unreasonable dialing delays, as required
under Section 251(b)(3) of the Act.

16.0     ACCESS TO RIGHTS-OF-WAY -- SECTION 251(b)(4)

         Each Party ("Licensor") shall provide the other Party ("Licensee")
access for purposes of making attachments to the poles, ducts, rights-of-way and
conduits it owns or controls, pursuant to any existing or future license
agreement between the Parties, and in conformance with 47 U.S.C. 224, where
facilities are available, on terms, conditions and prices comparable to those
offered to any other entity pursuant to each Party's applicable Tariffs
(including generally available license agreements). Where no such Tariffs exist,
such access shall be provided in accordance with the requirements of 47 U.S.C.
224, including any applicable FCC regulations that may be issued.

17.0     DATABASES AND SIGNALING

         BA shall provide MGC with interfaces to access BA's databases,
including LIDB and toll-free service access codes (i.e.; 800/888), and
associated signaling necessary for the routing and completion of MGC's traffic
through the provision of SS7 under its applicable tariffs.

18.0     COORDINATED SERVICE ARRANGEMENTS

         18.1     Intercept and Referral Announcements

         When a Customer changes its service provider from BA to MGC, or from
MGC to BA, and does not retain its original telephone number, the Party formerly
providing service to such Customer shall provide a referral announcement
("Referral Announcement") on the abandoned telephone number which provides
details on the Customer's new number or provide other appropriate information to
the extent known. Referral Announcements shall be provided reciprocally, free of
charge to either the other Party or the Customer, for a period of not less than
one hundred and eighty days (180) days after the date the Customer changes its
telephone number in the case of business Customers and not less than ninety (90)
days after the date the Customer changes its telephone number in the case of
residential Customers or other time periods as may be required by the
Commission. The periods for referral announcement may be shorter if a number
shortage conditions is in effect for a particular NXX code. However, if either
Party provides Referral Announcements for a period different than the above
respective periods

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

when its Customers change their telephone numbers, such Party shall provide the
same level of service to Customers of the other Party.

         18.2     Coordinated Repair Calls

         MGC and BA will employ the following procedures for handling
misdirected repair calls:

                  18.2.1 MGC and BA will educate their respective Customers as
to the correct telephone numbers to call in order to access their respective
repair bureaus.

                  18.2.2 To the extent Party A is identifiable as the correct
provider of service to Customers that make misdirected repair calls to Party B,
Party B will immediately refer the Customers to the telephone number provided by
Party A, or to an information source that can provide the telephone number of
Party A, in a courteous manner and at no charge.

                  18.2.3 MGC and BA will provide their respective repair contact
numbers to one another on a reciprocal basis.

         18.3     Customer Authorization

                  18.3.1 Without in any way limiting either Party's obligations
under subsection 28.1, each Party shall comply with Applicable Laws with regard
to Customer selection of a primary Telephone Exchange Service provider. Until
the Commission and/or FCC adopts regulations and/or orders applicable to
Customer selection of a primary Telephone Exchange Service provider, each Party
shall adhere to the rules and procedures set forth in Section 64.1100 of the FCC
Rules, 47 CFR ss. 64.1100, in effect on the Effective Date hereof when ordering,
terminating, or otherwise changing Telephone Exchange Service on behalf of the
other Party's or another carrier's Customers.

                  18.3.2 In the event either Party requests that the other Party
install, provide, change, or terminate a Customer's Telecommunications Service
(including, but not limited to, a Customer's selection of a primary Telephone
Exchange Service Provider) and (a) fails to provide documentary evidence of the
Customer's primary Telephone Exchange Service Provider selection upon request,
or (b) without having obtained authorization from the Customer for such
installation, provision, selection, change or termination in accordance with
Applicable Laws (or as provided in subsection 18.3.1 above), the requesting
Party shall be liable to the other Party for all charges that would be
applicable to the Customer for the initial change in the Customer's

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

Telecommunications Service and any charges for restoring the Customer's
Telecommunications Service to its Customer-authorized condition, including to
the appropriate primary Telephone Exchange Service provider.

                  18.3.3 Without in any way limiting MGC's obligations under
subsection 28.1, MGC shall comply with Applicable Laws with regard to Customer
Proprietary Network Information, including, but not limited to, 47 U.S.C. ss.
222. MGC shall not access (including, but not limited to, through BA OSS
Services and BA Pre-OSS Services), use, or disclose Customer Proprietary Network
Information made available to MGC by BA pursuant to this Agreement unless MGC
has obtained any Customer authorization for such access, use and/or disclosure
required by Applicable Laws. By accessing, using or disclosing Customer
Proprietary Network Information, MGC represents and wan-ants that it has
obtained authorization for such action from the applicable Customer in the
manner required by Applicable Laws and this Agreement. MGC shall, upon request
by BA, provide proof of such authorization (including a copy of any written
authorization).

                  18.3.4 BA shall have the right to monitor and/or audit MGC's
access to and use and/or disclosure of Customer Proprietary Network Information
that is made available by BA to MGC pursuant to this Agreement to ascertain
whether MGC is complying with the requirements of Applicable Laws and this
Agreement with regard to such access, use, and/or disclosure. To the extent
permitted by Applicable Laws, the foregoing right shall include, but not be
limited to, the right to electronically monitor MGC's access to and use of
Customer Proprietary Network Information that is made available by BA to MGC
pursuant to this Agreement.

19.0     DIRECTORY SERVICES ARRANGEMENTS

         BA will provide certain directory services to MGC as defined herein. In
this Section 19 of this Agreement, references to MGC customer telephone numbers
means telephone numbers falling within NXX codes directly assigned to MGC and to
numbers which are retained by MGC on the customer's behalf pursuant to Interim
Telephone Number Portability arrangements described in Section 14.0 of this
Agreement.

         19.1     Directory Listings and Directory Distributions

                  19.1.1 BA will include MGC's Customers telephone numbers in
all of its "White Pages" and "Yellow Pages" directory listings (including
electronic directories) and directory assistance databases associated with the
areas in which MGC provides services to such

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

customers, and will distribute such directories to such customers, in an
identical and transparent manner in which it provides those functions for its
own customers' telephone numbers.

                  19.1.2 BA will include all MGC NXX codes on appropriate
existing calling charts in the BA customer Guide section of the directory in the
same manner as it provides this conformation for its own NXX Codes.

                  19.1.3 MGC will provide BA with its directory listings and
daily updates to those listings (including new, changed, and deleted listings)
in a mutually agreed upon format at no charge.

                  19.1.4 BA will accord MGC's directory listing information the
same level of confidentiality which BA accords its own directory listing
information.

                  19.1.5 BA will include, without charge, an Other Local Service
Provider section in its Primary White and Primary White and Yellow Page
Telephone Directories. When MGC is operating with established end users in the
geographic region covered by a specific White Page or Primary White and Yellow
Page Directory, MGC will be included, at its request, in the Other Local Service
Provider section of that specific directory. MGC will be responsible for
providing the Other Local Service Provider Information Pages Input Form to Bell
Atlantic Yellow Pages Company for each directory. MGC telephone numbers for
installation, repair and billing departments, and logo information that appears
in the directory will be in accordance with BA's generally applicable policies.
MGC shall comply with the Other Local Service Provider Information Pages General
Guidelines.

                  19.1.6 BA will provide MGC with a report of all MGC customer
listings ninety (90) days prior to service order close date for that directory
in such form and format as may be mutually agreed to by both parties. Both
Parties shall use their best efforts to ensure the accurate listing of such
information. BA will process any corrections made by MGC with respect to its
listings, provided such corrections are received prior to the close date of the
particular directory. BA will provide appropriate advance notice of applicable
close dates.

                  19.1.7     Yellow Page Maintenance

                  BA will work cooperatively with MGC so that Yellow Page
advertisements purchased by customers who switch their service to MGC (including
customers utilizing Interim Telephone Number Portability) are maintained without
interruption. BA will allow MGC

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

customers to purchase new yellow pages advertisements without discrimination,
under the identical rates, terms and conditions that apply to BA's customers.

         19.2     Directory Assistance and Operator Services

         At the option of MGC, BA will provide Directory Assistance to MGC
Customers on behalf of MGC under the following terms and conditions:

         BA provides Directory Assistance ("DA") service to MGC's customers
served by MGC's own switching facilities over separate trunk groups ordered or
provided by MGC to the BA Traffic Operation Position Systems ("TOPS") switch(es)
designated by BA. Access to the BA DA platform from MGC's local switch requires
that MGC utilize Feature Group C ("FG-C") Modified Operator Services Signaling.
The Interoffice Transmission Facility ("IOF") mileage rate for the facility will
be based on airline mileage using V&H coordinate methods from the MGC location
to the designated BA TOPS. Trunk terminations at the TOPS switch(es) require MGC
to purchase trunk ports at rates specified in Exhibit A. For each trunk group
MGC must indicate the DA option selected from those set forth in 19.2.2 (a), (b)
and (c) below; and/or

         BA provides MGC access to DA service for MGC Customers served by BA
unbundled local Switching Elements, through dedicated IOF and trunk ports
between the BA End Office in which MGC has unbundled local switching ports and
the BA TOPS switches. Additional per minute of use ("MOU") local switching
charges, set forth in Exhibit A, will apply for all calls which interconnect
from the unbundled local switching ports to the BA TOPS.

                  19.2.1     Directory Assistance

                  At MGC's option, BA will provide MGC Customers access to
                  Telephone Directory Assistance operators via 411, 555-1212, or
                  1+ (NPA) 555-1212 dialing.

                  Rates for requests for Directory Assistance will be billed to
                  MGC and are stated in Exhibit A.

                  BA will not provide Directory Assistance call allowances to
                  MGC or MGC's Customers.

                  19.2.2     Directory Assistance with Branding

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  This service allows MGC to select only one of the three
options as follows:

                  . (a)      MGC may provide BA with a MGC branded, introductory
                             Directory Assistance and Operator Services
                             announcement which will be played for all MGC
                             Customers completing DA or Operator Services calls
                             over the trunk group to the BA TOPS.

                  Such branding announcement may be a maximum of eighteen (18)
                  seconds, recorded by MGC or, at MGC's request and subject to
                  charges to be determined on an individual case basis, by BA.
                  MGC must provide a minimum of two (2) audio cassette
                  recordings of the MGC branding announcement.

                  . (b)      MGC may request BA branded announcement.

                  . (c)      MGC may request an unbranded, generic announcement.

                  Rates for requests for Directory Assistance with branding will
                  be billed to MGC and are stated in Exhibit A.

         19.3     Directory Assistance Call Completion

         At MGC's option BA will provide Directory Assistance Call Completion
("DACC") for automatic connection of a MGC Customer calling BA DA and the
published telephone number requested.

         After the BA DA operator provides the requested number, a recorded
service message will offer to connect the MGC Customer to that number for a
specified additional charge.

         The MGC Customer can accept the offer for DACC by depressing a button
(touch tone) or responding by voice (dial), as instructed by the voice message.

         The DACC charge will apply as set forth in Exhibit A. In addition, for
calls originating from a facilities-based MGC switch or for calls from MGC
unbundled local switching line ports, there will be charges to terminate the
call from the TOPS Tandem to the called party. These include applicable per
minute of use Unbundled Tandem Transport Charges ("UTTC") for each call
transported between the TOPS Tandem and the originating End Office, per minute
of use Tandem Transit Switching Charge ("TTSC") for each call that traverses a
BA Tandem switch,

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

and the appropriate per minute of use charges for Reciprocal Compensation
("UNRCC" or "UCRCC") depending on the terminating End Office Switch, as set
forth in Exhibit A.

         DACC is available to MGC residence and business Customers and from
public telephones on a collect, bill to third number or calling card basis.
Appropriate charges for the selected billing option will apply in addition to
the DACC charge.

         DACC is available with all telephone numbers in the BA DA database with
the following exceptions:

                  - non-published telephone numbers
                  - interLATA numbers
                  - 700, 800 and 900 numbers.

         When a caller requests more than one number for Directory Assistance,
DACC is offered only for the first eligible listing that was selected by the
operator.

         The DACC charge applies only to calls actually completed.

         The DACC charge will be credited for completion of calls to the wrong
number, incomplete connections or calls with unsatisfactory transmission as set
forth in Section 19.4 following.

         Rates for requests for DACC will be billed to MGC as set forth in
Exhibit A.

         19.4     Directory Assistance Credits

         Directory Assistance credits will apply to MGC for directory
inaccessibility, wrong numbers, cut-offs and poor transmission. When a MGC
Customer reports such a call, i.e. the requested number, the provided number,
and the reason the provided number is incorrect, to the BA directory assistance
operator, the number of calls for which a credit will apply will be developed by
the BA DA operator and credited to MGC. BA will identify the specific MGC
Customer to whom the credit applies.

         19.5     Direct Access to Directory Assistance

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         Direct Access to Directory Assistance ("DADA") is a database service
that provides access to BA listings to a MGC operator. The DADA database is a
physically distinct entity from the BA DA database, populated with identical
listing data, and updated from the same source on a daily basis.

         To obtain access, MGC is required to arrange for interconnection to the
database. BA will interconnect at any technically feasible point designated by
MGC.

         BA will provide MGC with a User Guide for training its agents.

         Rates and Charges for DADA are stated in Exhibit A.

         19.6     Inward Operator Services

         Inward Operator Services enables MGC or its operator service provider
         to connect to the BA TOPS office(s) for the purpose of providing
         certain operator services to MGC Customers. There are two
types of Inward Operator Services:

                  19.6.1     Busy Line Verification ("BLV"):

                  BLV is service wherein, at the request of MGC's Customer or
operator service provider, a BA operator will attempt to determine the status of
an exchange service line (e.g., conversation in progress, available to receive a
call or out of service) and report to MGC's Customer or operator service
provider.

                  19.6.2     Busy Line Verification/Interrupt ("BLV/I")

                  BLV/I is a service wherein, at the request of MGC's Customer
or operator service provider, a BA operator will determine and report whether a
conversation is in progress on an exchange service line, and then interrupt such
conversation to request that it be terminated so that MGC's Customer may
complete a call to the line. MGC may order Inward Operator Services under the
following terms and conditions:

                  Inward Operator Services are provided over trunk groups
ordered by MGC or its alternate operator service provider to BA TOPS switch(es)
as specified by BA.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  Inward Operator Services cannot be provided for ported
telephone numbers, or telephone numbers which forward calls using Call
Forwarding Variable service features.

                  BA will provide BLV and BLV/I for telephone numbers provided
in its operating territory.

                  The BA operator will respond to one telephone number per call
on requests for BLV or BLV/I.

                  BA will designate the TOPS switch(es) serving specific NXXs
and make such information available to MGC.

                  MGC and its Customer shall indemnify and save BA harmless
against all claims that may arise from either party to the interrupted call or
any other person.

                  Rates and Charges for Inward Operator Services are set forth
in Exhibit A.

         19.7     Operator Services

         At MGC's option, BA will provide for the routing of Operator Services
("OS") calls dialed by MGC Customers directly to either the MGC Operator
Services platform or to the BA Operator Services platform.

         BA provides OS to MGC Customers served by MGC switches over separate
trunk groups ordered or provided by MGC to the BA TOPS switch(es) as specified
by BA. Access to the BA OS platform from MGC's local switch requires that MGC
utilize Feature Group C Modified Operator Services Signaling. The Interoffice
Transmission Facility mileage rate for the facility will be based on airline
mileage using V&H coordinate methods from the MGC location to the designated BA
TOPS. Trunk terminations at the TOPS switch(es) require MGC to purchase trunk
ports at rates specified in Exhibit A. For each trunk group, MGC must indicate
the branding option selected as set forth in Sections 19.2.2 (a), (b), and (c)
preceding; and/or

         BA also provides MGC access to OS for MGC Customers served by BA
unbundled local Switching Elements, through dedicated IOF and trunk ports
between the BA End Office in which MGC has unbundled local switching ports and
the BA TOPS switches. Additional per minute of use ("MOU") local switching
charges, set forth in Exhibit A, will apply for all calls which interconnect
from the unbundled local switching ports to the BA TOPS.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         19.8     0+ Mechanized Operator Calls (Calling Card, Collect, Bill to
                  Third Number)

         At MGC's option, the mechanized BA operator interface will provide
MGC's Customer the ability to complete 0+ mechanized operator calls using
alternate billing capabilities without live operator assistance. Alternate
billing call completions can be calling card, collect or bill-to-third-number.

         0+ mechanized calls may be routed over the same DA trunk groups which
provide interconnection from the MGC switch or from the MGC unbundled local
switching line ports to the BA TOPS.

         Rates for requests for 0+ mechanized calls will be billed to MGC and
are set forth in Exhibit A. In addition, for calls originating from a
facilities-based MGC switch or for calls from MGC unbundled local switching line
ports, there will be charges to terminate the call from the TOPS Tandem to the
called party. These include applicable per minute of use Unbundled

         Tandem Transport Charges ("UTTC") for each call transported between the
TOPS Tandem and the originating End Office, per minute of use Tandem Transit
Switching Charge ("TTSC') for each call that traverses a BA Tandem switch, and
the appropriate per minute of use charges for Reciprocal Compensation ("UNRCC"
or "UCRCC") depending on the terminating End Office Switch, as set forth in
Exhibit A.

         19.9     0- Operator Handled Calls (Calling Card, Collect, Bill to
                  Third Number)

         At MGC's option, the BA will provide live operator assistance to the
MGC Customer for intraLATA calls completion via 0- dialing with alternate
billing capabilities. Alternate billing capabilities include calling card,
collect and bill-to-third-number, station-to-station and person-to-person.

         0- operator handled calls may be routed over the same DA trunk groups
which provide interconnection from the MGC switch or the MGC unbundled local
switching line ports to the BA TOPS.

         Rates for requests for 0- operator handled calls will be billed to MGC
and are set forth in Exhibit A. In addition, for calls originating from a
facilities-based MGC switch or for calls from MGC unbundled local switching line
ports, there will be charges to terminate the call from the

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

TOPS Tandem to the called party. These include applicable per minute of use
Unbundled Tandem Transport Charges ("UTTC") for each call transported between
the TOPS Tandem and the originating End Office, per minute of use Tandem Transit
Switching Charge ("TTSC") for each call that traverses a BA Tandem switch, and
the appropriate per minute of use charges for Reciprocal Compensation ("UNRCC"
or "UCRCC") depending on the terminating End Office Switch, as set forth in
Exhibit A.

         19.10    Operator Emergency Bulletin Service

         At MGC's option, BA will provide MGC with emergency numbers for police,
fire, ambulance and Public Safety Answering Points (PSAP) in the BA serving area
so that MGC operators can connect callers directly to the proper emergency
bureaus.

         The BA Operator Emergency Bulletin Service lists the emergency, police,
fire, ambulance and PSAP telephone numbers by municipality and in alphabetical
order for each of the areas served by BA.

         Operator Emergency Bulletin Service is available for use by MGC
operators solely for the purpose of assisting callers in reaching an emergency
bureau.

         Operator Emergency Bulletin Service provides a copy of BA's own
emergency bulletin. This service includes one annual copy of the bulletin plus
periodic updates during the year. Other Local Exchange Carrier emergency numbers
are not included.

         Rates and charges for Operator Emergency Bulletin service are set forth
in Exhibit A.

         19.11    Operator Passthrough Service

         At MGC's option, BA will, provide MGC's Customers with operator
passthrough service to access their presubscribed Interexchange Carrier's
operators for operator assisted call completion. Such access will be available
only where the presubscribed IXC provides operator services for MGC's Customers
for calls originating from a particular LATA, and where the IXC OS has the
capability to receive calls passed from BA within the LATA.

         If an IXC does not provide operator services for MGC's Customer, BA
will provide MGC's Customer with access to an IXC designated operator services
provider or to a BA

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

provided announcement which will direct MGC's Customer to contact the Customer's
presubscribed IXC for dialing instructions.

         The Operator Passthrough charge is applied on an operator work second
basis, and rated using the 0- operator handled calls in Exhibit A.

         MGC will be charged for calls passed through to either the
Presubscribed IXC's operator, or to a BA provided recording indicating that the
IXC does not provide service in that area.

         Rates and charges for operator passthrough service are stated in
Exhibit A.

20.0     COORDINATION WITH TARIFF TERMS

         20.1 The Parties acknowledge that some of the services, facilities, and
arrangements described herein are or will be available under and subject to the
terms of the federal or state tariffs of the other Party applicable to such
services, facilities, and arrangements. To the extent a Tariff of the providing
Party applies to any service, facility, and arrangement described herein, the
Parties agree as follows:

                  20.1.1 Those rates and charges set forth in Exhibit A for the
services, facilities, and arrangements described herein that reference or are
identical to a rate contained in an existing Tariff of the providing Party,
shall conform with those contained in the then-prevailing Tariff and vary in
accordance with any changes that may be made to the Tariff rates and charges
subsequent to the Effective Date.

                  20.1.2 As applied to wholesale discount rates, unbundled
Network Elements or termination of Reciprocal Compensation Traffic and other
Interconnection services purchased for the provision of Telephone Exchange
Service or Exchange Access, the rates and charges set forth in Exhibit A shall
apply until such time as they are replaced by new rates as may be approved by
the Commission from time to time, subject to a stay or other order issued by any
court of competent jurisdiction. At such time(s) as such new rates have been
approved by the Commission, the Parties shall amend Exhibit A to reflect the new
approved rates.

         20.2 Except with respect to the rates and charges described in
subsection 20.1 above, all other terms contained in an applicable Tariff of the
providing Party shall apply in connection with its provision of the particular
service, facility, and arrangement hereunder.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

21.0     INSURANCE

         21.1 MGC shall maintain, during the term of this Agreement, all
insurance and/or bonds required by law and necessary to satisfy its obligations
under this Agreement, including, without limitation, its obligations set forth
in Section 25 hereof. At a minimum and without limiting the foregoing covenant,
MGC shall maintain the following insurance:

         (a)      Commercial General Liability Insurance, on an occurrence
                  basis, including but not limited to, premises-operations,
                  broad form property damage, products/completed operations,
                  contractual liability, independent contractors, and personal
                  injury, with limits of at least $2,000,000 combined single
                  limit for each occurrence.

         (b)      Automobile Liability, Comprehensive Form, with limits of at
                  least $500,000 combined single limit for each occurrence.

         (c)      Excess Liability, in the umbrella form, with limits of at
                  least $10,000,000 combined single limit for each occurrence.

         (d)      Worker's Compensation Insurance as required by law and
                  Employer's Liability Insurance with limits of not less than
                  $1,000,000 per occurrence.

         21.2     MGC shall name BA as an additional insured on the foregoing
insurance.

         21.3 MGC shall, within two (2) weeks of the date hereof and on a
semi-annual basis thereafter, furnish certificates or other adequate proof of
the foregoing insurance. The certificates or other proof of the foregoing
insurance shall be sent to: [Bell Atlantic, Insurance Administration Group, 1320
N. Court House Road, 4th Floor, Arlington, Virginia, 22201]. In addition, MGC
shall require its agents, representatives, or contractors, if any, that may
enter upon the premises of BA or BA's affiliated companies to maintain similar
and appropriate insurance and, if requested, to furnish BA certificates or other
adequate proof of such insurance. Certificates furnished by MGC or MGC's agents,
representatives, or contractors shall contain a clause stating: "BA - New York
shall be notified in writing at least thirty (30) days prior to cancellation of,
or any material change in, the insurance."

22.0     TERM AND TERMINATION

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         22.1 This Agreement shall be effective as of the date first above
written and continue in effect until December 31, 1999, and thereafter the
Agreement shall continue in force and effect unless and until terminated as
provided herein. Upon the expiration of the initial term, either Party may
terminate this Agreement by providing written notice of termination to the other
Party, such written notice to be provided at least ninety (90) days in advance
of the date of termination. In the event of such termination, those service
arrangements made available under this Agreement and existing at the time of
termination shall continue without interruption under (a) a new agreement
executed by the Parties, (b) standard Interconnection terms and conditions
approved and made generally effective by the Commission, (c) Tariff terms and
conditions generally available to CLECs, or (d) if none of the above is
available, under the terms of this Agreement on a month-to-month basis until
such time as (a), (b), or (c) becomes available.

         22.2 For service arrangements made available under this Agreement and
existing at the time of termination, if the standard Interconnection terms and
conditions or Tariff terms and conditions result in the non-terminating Party
physically rearranging facilities or incurring programming expense, the
non-terminating Party shall be entitled to recover such rearrangement or
programming costs from the terminating Party.

         22.3 If either Party defaults in the payment of any amount due
hereunder, or if either Party violates any other provision of this Agreement,
and such default or violation shall continue for sixty (60) days after written
notice thereof, the other Party may terminate this Agreement and services
hereunder by written notice; provided the other Party has provided the
defaulting Party and the appropriate federal and/or state regulatory bodies with
written notice at least twenty-five (25) days prior to terminating service.
Notice shall be posted by overnight mail, return receipt requested. If the
defaulting Party cures the default or violation within the twenty-five (25) day
period, the other Party will not terminate service or this Agreement but shall
be entitled to recover all costs, if any, incurred by it in connection with the
default or violation, including, without limitation, costs incurred to prepare
for the termination of service.

23.0     DISCLAIMER OF REPRESENTATIONS AND WARRANTIES

         EXCEPT AS EXPRESSLY PROVIDED UNDER THIS AGREEMENT, NO PARTY MAKES OR
RECEIVES ANY WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICES,
FUNCTIONS AND PRODUCTS IT PROVIDES UNDER OR CONTEMPLATED BY THIS AGREEMENT AND
THE PARTIES DISCLAIM THE IMPLIED WARRANTIES OF MERCHANTABILITY OR OF FITNESS FOR
A PARTICULAR PURPOSE.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

24.0     CANCELLATION CHARGES

         Except as provided in this Agreement or as otherwise provided in any
applicable Tariff, no cancellation charges shall apply.

25.0     INDEMNIFICATION

         25.1 Each Party agrees to release, indemnify, defend and hold harmless
the other Party from and against all losses, claims, demands, damages, expenses,
suits or other actions, or any liability whatsoever, including, but not limited
to, costs and attorneys' fees (collectively, a "Loss"), (a) whether suffered,
made, instituted, or asserted by any other party or person, relating to personal
injury to or death of any person, or for loss, damage to, or destruction of real
and/or personal property, whether or not owned by others, arising from
transactions or activities relating to this Agreement and to the extent
proximately caused by the negligent or willful acts or omissions of the
indemnifying Party, regardless of the form of action, or (b) suffered, made,
instituted, or asserted by its own customer(s) against the other Party arising
out of the other Party's provision of services to the indemnifying Party under
this Agreement. Notwithstanding the foregoing indemnification, nothing in this
Section 25.0 shall affect or limit any claims, remedies, or other actions the
indemnifying Party may have against the indemnified Party under this Agreement,
any other contract, or any applicable Tariff(s), regulations or laws for the
indemnified Party's provision of said services.

         25.2     The indemnification provided herein shall be conditioned upon:

         (a)      The indemnified Party shall promptly notify the indemnifying
                  Party of any action taken against the indemnified Party
                  relating to the indemnification.

         (b)      The indemnifying Party shall have sole authority to defend any
                  such action, including the selection of legal counsel, and the
                  indemnified Party may engage separate legal counsel only at
                  its sole cost and expense.

         (c)      In no event shall the indemnifying Party settle or consent to
                  any judgment pertaining to any such action without the prior
                  written consent of the indemnified Party, which consent shall
                  not be unreasonably withheld. However, in the event the
                  settlement or judgment requires a contribution from or affects
                  the rights of the Indemnified Party, the Indemnified Party
                  shall have the right to refuse such

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  settlement or judgment and, at its own cost and expense, take
                  over the defense against such Loss, provided that in such
                  event the indemnifying Party shall not be responsible for, nor
                  shall it be obligated to indemnify the indemnified Party
                  against, the Loss for any amount in excess of such refused
                  settlement or judgment.

         (d)      The indemnified Party shall, in all cases, assert any and all
                  provisions in its Tariffs that limit liability to third
                  parties as a bar to any recovery by the third party claimant
                  in excess of such limitation of liability.

         (e)      The indemnified Party shall offer the indemnifying Party all
                  reasonable cooperation and assistance in the defense of any
                  such action.

26.0     LIMITATION OF LIABILITY

         26.1 The liability of either Party to the other Party for damages
arising out of failure to comply with a direction to install, restore or
terminate facilities; or out of failures, mistakes, omissions, interruptions,
delays, errors, or defects (collectively, "Errors") occurring in the course of
furnishing any services, arrangements, or facilities hereunder shall be
determined in accordance with the terms of the applicable tariff(s) of the
providing Party. In the event no tariff(s) apply, the providing Party's
liability for such Errors shall not exceed an amount equal to the pro rata
monthly charge for the period in which such failures, mistakes, omissions,
interruptions, delays, errors or defects occur. Recovery of said amount shall be
the injured Party's sole and exclusive remedy against the providing Party for
such failures, mistakes, omissions, interruptions, delays, errors or defects.

         26.2 Neither Party shall be liable to the other in connection with the
provision or use of services offered under this Agreement for indirect,
incidental, consequential, reliance or special damages, including (without
limitation) damages for lost profits (collectively, "Consequential Damages"),
regardless of the form of action, whether in contract, warranty, strict
liability, or tort, including, without limitation, negligence of any kind, even
if the other Party has been advised of the possibility of such damages;
provided, that the foregoing shall not limit a Party's obligation under Section
25.

         26.3 The Parties agree that neither Party shall be liable to the
customers of the other Party in connection with its provision of services to the
other Party under this Agreement. Nothing in this Agreement shall be deemed to
create a third party beneficiary relationship between the Party providing the
service and the customers of the Party purchasing the service. In

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

the event of a dispute involving both Parties with a customer of one Party, both
Parties shall assert the applicability of any limitations on liability to
customers that may be contained in either Party's applicable Tariff(s).

27.0     PERFORMANCE STANDARDS FOR SPECIFIED ACTIVITIES

         27.1     Performance Standards

         BA shall provide the Interconnection and unbundled Network Elements
contemplated hereunder in accordance with the performance standards set forth in
Section 251(c) of the Act and the FCC Regulations.

         27.2     Performance Reporting

                  27.2.1 At such time as BA makes available the Performance
Monitoring Reports described by the FCC Order in the Application of BELL
ATLANTIC Corporation, Transferee, For Consent to Transfer Control of BELL
ATLANTIC Corporation and its Subsidiaries, NSD-L-96-10, Memorandum Opinion and
Order (August 14, 1997) ("the FCC Merger Order") to other Telecommunications
Carriers purchasing Interconnection from BA, BA shall provide MGC with the
Performance Monitoring Reports applicable to MGC in accordance with the
requirements of said FCC Merger Order.

                  27.2.2 MGC agrees that the performance information included in
the Performance Monitoring Reports is confidential and proprietary to BA, and
shall be used by MGC solely for internal performance assessment purposes, for
purposes of joint MGC and BA assessments of service performance, and for
reporting to the Commission, the FCC, or courts of competent jurisdiction, under
cover of an agreed-upon protective order, for the sole purpose of enforcing BA's
obligations hereunder. MGC shall not otherwise disclose this information to
third parties.

28.0     COMPLIANCE WITH LAWS; REGULATORY APPROVAL

         28.1 Each Party shall promptly notify the other Party in writing of any
governmental action that suspends, cancels, withdraws, limits, or otherwise
materially affects its ability to perform its obligations hereunder.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         28.2 The Parties understand and agree that this Agreement will be filed
with the Commission and may thereafter be filed with the FCC as an integral part
of BA's application pursuant to Section 271(d) of the Act. The Parties covenant
and agree that this Agreement is satisfactory to them as an agreement under
Section 251 of the Act. Each Party covenants and agrees to fully support
approval of this Agreement by the Commission or the FCC under Section 252 of the
Act without modification. The Parties, however, reserve the right to seek
regulatory relief and otherwise seek redress from each other regarding
performance and implementation of this Agreement, including, without limitation,
the conformance of this Agreement to the FCC Regulations as provided in
subsection 28.3 below.

         28.3 The Parties recognize that the FCC has issued and may continue to
issue regulations implementing Sections 251, 252, and 271 of the Act that affect
certain terms contained in this Agreement. In the event that any one or more of
the provisions contained herein is inconsistent with any applicable rule
contained in such FCC Regulations or, in BA's reasonable determination, affects
BA's application pursuant to Section 271(d) of the Act, the Parties agree to
make only the minimum revisions necessary to eliminate the inconsistency or
amend the application-affecting provision(s). Such minimum revisions shall not
be considered material, and shall not require further Commission approval
(beyond any Commission approval required under Section 252(e) of the Act).

         28.4 In the event any Applicable Law other than the FCC Regulations
requires modification of any material term(s) contained in this Agreement,
either Party may require a renegotiation of the term(s) that require direct
modification as well as of any term(s) that are reasonably affected thereby. If
neither Party requests a renegotiation or if an Applicable Law requires
modification of any non-material term(s), then the Parties agree to make only
the minimum modifications necessary, and the remaining provisions of this
Agreement shall remain in full force and effect. For purposes of this subsection
28.4 and without limitation of any other modifications required by Applicable
Laws, the Parties agree that any modification required by Applicable Laws (i) to
the two-tier Reciprocal Call Termination compensation structure for the
transport and termination of Reciprocal Compensation Traffic described in
Exhibit A, or (ii) that affects either Party's receipt of reciprocal
compensation for the transport and termination of Reciprocal Compensation
Traffic, shall be deemed to be a modification of a material term that requires
immediate good faith renegotiation between the Parties.

         28.5 Compliance with the Communications Assistance for Law Enforcement
Act of 1994 ("CALEA"). Each Party represents and warrants that any equipment,
facilities or services provided to the other Party under this Agreement comply
with CALEA. Each Party shall

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

indemnify and hold the other Party harmless from any and all penalties imposed
upon the other Party for such noncompliance and shall at the non-compliant
Party's sole cost and expense, modify or replace any equipment, facilities or
services provided to the other Party under this Agreement to ensure that such
equipment, facilities and services fully comply with CALEA.

29.0     MISCELLANEOUS

         29.1     Authorization

                  29.1.1 BA is a corporation duly organized, validly existing
and in good standing under the laws of the State of New York and has full power
and authority to execute and deliver this Agreement and to perform the
obligations hereunder.

                  29.1.2 MGC is a corporation duly organized, validly existing
and in good standing under the laws of the State of Nevada, and has full power
and authority to execute and deliver this Agreement and to perform its
obligations hereunder.

         29.2     Independent Contractor

         Each Party shall perform services hereunder as an independent
contractor and nothing herein shall be construed as creating any other
relationship between the Parties. Each Party and each Party's contractor shall
be solely responsible for the withholding or payment of all applicable federal,
state and local income taxes, social security taxes and other payroll taxes with
respect to their employees, as well as any taxes, contributions or other
obligations imposed by applicable state unemployment or workers' compensation
acts. Each Party has sole authority and responsibility to hire, fire and
otherwise control its employees.

         29.3     Force Majeure

         Neither Party shall be responsible for delays or failures in
performance resulting from acts or occurrences beyond the reasonable control of
such Party, regardless of whether such delays or failures in performance were
foreseen or foreseeable as of the date of this Agreement, including, without
limitation: adverse weather conditions, fire, explosion, power failure, acts of
God, war, revolution, civil commotion, or acts of public enemies; any law,
order, regulation, ordinance or requirement of any government or legal body; or
labor unrest, including, without limitation, strikes, slowdowns, picketing or
boycotts; or delays caused by the other Party or by other service or equipment
vendors; or any other circumstances beyond the Party's reasonable

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

control. In such event, the affected Party shall, upon giving prompt notice to
the other Party, be excused from such performance on a day-to-day basis to the
extent of such interferences (and the other Party shall likewise be excused from
performance of its obligations on a day-to-day basis to the extent such Party's
obligations relate to the performance so interfered with). The affected Party
shall use its best efforts to avoid or remove the cause(s) of non-performance
and both Parties shall proceed to perform with dispatch once the cause(s) are
removed or cease.

         29.4     Confidentiality

                  29.4.1 All information, including but not limited to
specification, microfilm, photocopies, magnetic disks, magnetic tapes, drawings,
sketches, models, samples, tools, technical information, data, employee records,
maps, financial reports, and market data, (i) furnished by one Party to the
other Party dealing with customer specific, facility specific, or usage specific
information, other than customer information communicated for the purpose of
publication or directory database inclusion, or (ii) in written, graphic,
electromagnetic, or other tangible form and marked at the time of delivery as
"Confidential" or "Proprietary," or (iii) communicated orally and declared to
the receiving Party at the time of delivery, and by written notice given to the
receiving Party within ten (10) days after delivery, to be "Confidential" or
"Proprietary" (collectively referred to as "Proprietary Information"), shall
remain the property of the disclosing Party.

                  29.4.2 Each Party shall keep all of the other Party's
Proprietary Information confidential in the same manner it holds its own
Proprietary Information confidential (which in all cases shall be no less than
reasonable) and shall use the other Party's Proprietary Information only for
performing the covenants contained in this Agreement. Neither Party shall use
the other Party's Proprietary Information for any other purpose except upon such
terms and conditions as may be agreed upon between the Parties in writing.

                  29.4.3 Unless otherwise agreed, the obligations of
confidentiality and non-use set forth in this Agreement do not apply to such
Proprietary Information that:

                  (a)        was, at the time of receipt, already known to the
                             receiving Party free of any obligation to keep it
                             confidential as evidenced by written records
                             prepared prior to delivery by the disclosing Party;
                             or

                  (b)        is or becomes publicly known through no wrongful
                             act of the receiving Party; or

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  (c)        is rightfully received from a third person having
                             no direct or indirect secrecy or confidentiality
                             obligation to the disclosing Party with respect to
                             such information; or

                  (d)        is independently developed by an employee, agent,
                             or contractor of the receiving Party that is not
                             involved in any manner with the provision of
                             services pursuant to this Agreement and does not
                             have any direct or indirect access to the
                             Proprietary Information; or

                  (e)        is approved for release by written authorization of
                             the disclosing Party; or

                  (f)        is required to be made public by the receiving
                             Party pursuant to applicable law or regulation,
                             provided that the receiving Party shall give
                             sufficient notice of the requirement to the
                             disclosing Party to enable the disclosing Party to
                             seek protective orders.

                  29.4.4 Upon request by the disclosing Party, the receiving
Party shall return all tangible copies of Proprietary Information, whether
written, graphic, electromagnetic or otherwise, except that the receiving Party
may retain one copy for archival purposes only.

                  29.4.5 Notwithstanding any other provision of this Agreement,
the provisions of this subsection 29.4 shall apply to all Proprietary
Information furnished by either Party to the other in furtherance of the purpose
of this Agreement, even if furnished before the Effective Date.

         29.5     Choice of Law

         The construction, interpretation and performance of this Agreement
shall be governed by and construed in accordance with the laws of the state in
which this Agreement is to be performed, except for its conflicts of laws
provisions. In addition, insofar as and to the extent federal law may apply,
federal law will control.

         29.6     Taxes

         Each Party purchasing services hereunder shall pay or otherwise be
responsible for all federal, state, or local sales, use, excise, gross receipts,
transaction or similar taxes, fees or

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

surcharges levied against or upon such purchasing Party (or the providing Party
when such providing Party is permitted to pass along to the purchasing Party
such taxes, fees or surcharges), except for any tax on either Party's corporate
existence, status or income. Whenever possible, these amounts shall be billed as
a separate item on the invoice. To the extent a sale is claimed to be for resale
tax exemption, the purchasing Party shall furnish the providing Party a proper
resale tax exemption certificate as authorized or required by statute or
regulation by the jurisdiction providing said resale tax exemption. Failure to
timely provide said resale tax exemption certificate will result in no exemption
being available to the purchasing Party.

         29.7     Assignment

         Either Party may assign this Agreement or any of its rights or
obligations hereunder to a third party, including, without limitation, its
parent or other affiliate, with the other Party's prior written consent, which
consent shall not be unreasonably withheld upon the provision of reasonable
evidence by the proposed assignee that it has the resources, ability, and
authority to provide satisfactory performance under this Agreement. Any
assignment or delegation in violation of this subsection 29.7 shall be void and
ineffective and constitute a default of this Agreement.

         29.8     Billing and Payment; Disputed Amounts

                  29.8.1 Except as may otherwise be provided in this Agreement,
each Party shall submit on a monthly basis an itemized statement of charges
incurred by the other Party during the preceding month(s) for services rendered
hereunder. Payment of billed amounts under this Agreement, whether billed on a
monthly basis or as otherwise provided herein, shall be due, in immediately
available U.S. funds, within thirty (30) days of the date of such statement.

                  29.8.2 Although it is the intent of both Parties to submit
timely and accurate statements of charges, failure by either Party to present
statements to the other Party in a timely manner shall not constitute a breach
or default, or a waiver of the right to payment of the incurred charges, by the
billing Party under this Agreement, and the billed Party shall not be entitled
to dispute the billing Party's statement(s) based on such Party's failure to
submit them in a timely fashion.

                  29.8.3 If any portion of an amount due to a Party (the
"Billing Party") under this Agreement is subject to a bona fide dispute between
the Parties, the Party billed (the "Non-Paying Party") shall within thirty (30)
days of its receipt of the invoice containing such disputed

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amount give notice to the Billing Party of the amounts it disputes ("Disputed
Amounts") and include in such notice the specific details and reasons for
disputing each item. The Non-Paying Party shall pay when due (i) all undisputed
amounts to the Billing Party and (ii) all Disputed Amounts into an interest
bearing escrow account with a third Party escrow agent mutually agreed upon by
the Parties.

                  29.8.4 If the Parties are unable to resolve the issues related
to the Disputed Amounts in the normal course of business within ninety (90) days
after delivery to the Billing Party of notice of the Disputed Amounts, each of
the Parties shall appoint a designated representative who has authority to
settle the dispute and who is at a higher level of management than the persons
with direct responsibility for administration of this Agreement. The designated
representatives shall meet as often as they reasonably deem necessary in order
to discuss the dispute and negotiate in good faith in an effort to resolve such
dispute. The specific format for such discussions will be left to the discretion
of the designated representatives, however all reasonable requests for relevant
information made by one Party to the other Party shall be honored.

                  29.8.5 If the Parties are unable to resolve issues related to
the Disputed Amounts within forty-five (45) days after the Parties' appointment
of designated representatives pursuant to subsection 29.9, then either Party may
file a complaint with the Commission to resolve such issues or proceed with any
other remedy pursuant to law or equity. The Commission may direct release of any
or all funds (including any accrued interest) in the escrow account, plus
applicable late fees, to be paid to either Party.

                  29.8.6 The Parties agree that all negotiations pursuant to
this subsection 29.8 shall remain confidential and shall be treated as
compromise and settlement negotiations for purposes of the Federal Rules of
Evidence and state rules of evidence.

                  29.8.7 Any undisputed amounts not paid when due shall accrue
interest from the date such amounts were due at the lesser of (i) one and
one-half percent (1-1/2%) per month or (ii) the highest rate of interest that
may be charged under applicable law.

         29.9     Dispute Resolution

                  29.9.1 Any dispute between the Parties regarding the
interpretation or enforcement of this Agreement or the provision of any services
hereunder shall be addressed by good faith negotiation between the Parties, in
the first instance, according to the escalation

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

procedures in Subsection 29.9.2 below, other than billing disputes which shall
be addressed according to the procedures established in Section 29.8. Should
such negotiations fail to resolve the dispute in the appropriate time periods as
specified in Subsection 29.9.2, either Party may initiate an appropriate action
in any regulatory or judicial forum of competent jurisdiction. The Parties may
also agree to other informal resolution processes for specific circumstances
prior to initiating a regulatory or judicial action.

                  29.9.2     Escalation Procedures

                  The Parties shall submit any dispute between BA and MGC for
resolution to an Inter-Company Review Board consisting of one representative
from each Party at the vice-president or above level (or such lower level as the
Parties agree) according to the following procedures:

                  (a)        Each Party must designate its initial
                             representative to the Inter-Company Review Board
                             within (15) days of the Effective Date of this
                             Agreement.

                  (b)        A Party may change its designee, or select an
                             alternative designee, on one (1) day's notice to
                             the other Party.

                  (c)        A dispute will be deemed submitted to the
                             Inter-Company Review Board on the date a Party
                             requests Inter-Company Review Board action in
                             writing, transmitted by facsimile as set forth in
                             Section 29.10 of the Agreement and to each Party's
                             representative designated pursuant to Section
                             29.9.2 (a).

                  (d)        If the Inter-Company Review Board is unable to
                             resolve a service affecting dispute within five
                             business days (or such longer period as agreed to
                             in writing by the Parties) of submission to it of
                             the dispute, a Party may initiate a judicial or
                             regulatory proceeding in accordance with the
                             requirements of Section 29.9. 1.

                  (e)        If the Inter-Company Review Board is unable to
                             resolve a non-service affecting dispute within
                             thirty (30) days (or such longer period as agreed
                             to in writing by the Parties) of submission to it
                             of the dispute, a Party may initiate a judicial or
                             regulatory proceeding in accordance with the
                             requirements of Section 29.9. 1.

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      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

                  (f)        The Parties agree that all negotiations pursuant to
                             this Section 29.9 shall be confidential and shall
                             be treated as compromise and settlement
                             negotiations for purposes of the Federal Rules of
                             Evidence and state rules of evidence.

         29.10    Notices

         Except as otherwise provided in this Agreement, notices given by one
Party to the other Party under this Agreement shall be in writing and shall be
(a) delivered personally, (b) delivered by express delivery service, (c) mailed,
certified mail or first class U.S. mail postage prepaid, return receipt
requested, or (d) delivered by telecopy to the following addresses of the
Parties:

                  To MGC:

                  MGC COMMUNICATIONS, INC.
                  3301 North Buffalo Drive
                  Las Vegas, Nevada 89129
                  Attn: Kent F. Heyman
                         Vice President and General Counsel
                  Facsimile: 702-310-5689

                  To BA:

                  BELL ATLANTIC
                  1095 Avenue of Americas
                  40th Floor
                  New York, NY 10036
                  Attn: President - Telecommunications Industry Services
                  Facsimile: (212) 597-2585

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                  with a copy to:

                  BELL ATLANTIC
                  1095 Avenue of Americas
                  40th Floor
                  New York, NY 10036
                  Attn: General Counsel
                  Facsimile: (212) 597-2560

or to such other address as either Party shall designate by proper notice.
Notices will be deemed given as of the earlier of (i) the date of actual
receipt, (ii) the next business day when notice is sent via express mail or
personal delivery, (iii) three (3) days after mailing in the case of first class
or certified U.S. mail, or (iv) on the date set forth on the confirmation in the
case of telecopy.

         29.11    Section 252(i) Obligations

                  29.11.1 To the extent required under Applicable Law, BA shall
make available without unreasonable delay to MGC any individual interconnection,
service or network element contained in any agreement to which it is a party
that is approved by the Commission pursuant to Section 252 of the Act, upon the
same rates, terms, and conditions as those provided in the agreement.

                  29.11.2 To the extent the exercise of the foregoing options
requires a rearrangement of facilities by the providing Party, the opting Party
shall be liable for the non-recurring charges associated therewith.

                  29.11.3 The Party electing to exercise such option shall do so
by delivering written notice to the first Party. Upon receipt of said notice by
the first Party, the Parties shall amend this Agreement to provide the same
rates, terms and conditions to the notifying Party for the remaining term of
this Agreement; provided, however, that the Party exercising its option under
this subsection 29.11 must continue to provide the same services or arrangements
to the first Party as required by this Agreement, subject either to the rates,
terms, and conditions applicable to the first Party in its agreement with the
third party or to the rates, terms, and conditions of this Agreement, whichever
is more favorable to the first Party in its sole determination.

                                      -74-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         29.12    Joint Work Product

         This Agreement is the joint work product of the Parties and has been
negotiated by the Parties and their respective counsel and shall be fairly
interpreted in accordance with its terms and, in the event of any ambiguities,
no inferences shall be drawn against either Party.

         29.13    No Third Party Beneficiaries; Disclaimer of Agency

         This Agreement is for the sole benefit of the Parties and their
permitted assigns, and nothing herein express or implied shall create or be
construed to create any third-party beneficiary rights hereunder. Except for
provisions herein expressly authorizing a Party to act for another, nothing in
this Agreement shall constitute a Party as a legal representative or agent of
the other Party, nor shall a Party have the right or authority to assume, create
or incur any liability or any obligation of any kind, express or implied,
against or in the name or on behalf of the other Party unless otherwise
expressly permitted by such other Party. Except as otherwise expressly provided
in this Agreement, no Party undertakes to perform any obligation of the other
Party, whether regulatory or contractual, or to assume any responsibility for
the management of the other Party's business.

         29.14    No License

                  29.14.1 Except as may be expressly provided herein, nothing in
this Agreement shall be construed as the grant of a license with respect to any
patent, copyright, trademark, trade name, trade secret or any other proprietary
or intellectual property now or hereafter owned, controlled or licensable by
either Party. Neither Party may use any patent, copyrightable materials,
trademark, trade name, trade secret or other intellectual property right of the
other Party except in accordance with the terms of a separate license agreement
between the Parties granting such rights.

                  29.14.2 Neither Party shall have any obligation to defend,
indemnify or hold harmless, or acquire any license or right for the benefit of,
or owe any other obligation or have any liability to, the other Party or its
customers based on or arising from any, claim, demand, or proceeding by any
third party alleging or asserting that the use of any circuit, apparatus, or
system, or the use of any software, or the performance of any service or method,
or the provision of any facilities by either Party under this Agreement, alone
or in combination with that of the other Party, constitutes direct, vicarious or
contributory infringement or inducement to infringe, misuse or misappropriation
of any patent, copyright, trademark, trade secret, or any other

                                      -75-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

proprietary or intellectual property right of any Party or third party. Each
Party, however, shall offer to the other reasonable cooperation and assistance
in the defense of any such claim.

                  29.14.3 NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT,
THE PARTIES AGREE THAT NEITHER PARTY HAS MADE, AND THAT THERE DOES NOT EXIST,
ANY WARRANTY, EXPRESS OR IMPLIED, THAT THE USE BY THE PARTIES OF THE OTHER'S
FACILITIES, ARRANGEMENTS, OR SERVICES PROVIDED UNDER THIS AGREEMENT SHALL NOT
GIVE RISE TO A CLAIM BY ANY THIRD PARTY OF INFRINGEMENT, MISUSE, OR
MISAPPROPRIATION OF ANY INTELLECTUAL PROPERTY RIGHT OF SUCH THIRD PARTY.

         29.15    Technology Upgrades

         Nothing in this Agreement shall limit BA's ability to upgrade its
network through the incorporation of new equipment, new software or otherwise.
BA shall provide MGC written notice at least ninety (90) days prior to the
incorporation of any such upgrades in BA's network that will materially affect
MGC's service, and shall exercise reasonable efforts to provide at least one
hundred eighty (180) days notice where practicable. In addition, BA shall comply
with the FCC Network Disclosure rules set forth in the FCC Regulations to the
extent applicable. MGC shall be solely responsible for the cost and effort of
accommodating such changes in its own network.

         29.16    Survival

         The Parties' obligations under this Agreement which by their nature are
intended to continue beyond the termination or expiration of this Agreement
shall survive the termination or expiration of this Agreement.

         29.17    Entire Agreement

         The terms contained in this Agreement and any Schedules, Exhibits,
tariffs and other documents or instruments referred to herein, which are
incorporated into this Agreement by this reference, constitute the entire
agreement between the Parties with respect to the subject matter hereof,
superseding all prior understandings, proposals and other communications, oral
or written. Neither Party shall be bound by any preprinted terms additional to
or different from those in this Agreement that may appear subsequently in the
other Party's form documents, purchase orders, quotations, acknowledgments,
invoices or other communications.

                                      -76-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         29.18    Counterparts

         This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same instrument.

         29.19    Modification, Amendment, Supplement, or Waiver

         No modification, amendment, supplement to, or waiver of the Agreement
or any of its provisions shall be effective and binding upon the Parties unless
it is made in writing and duly signed by the Parties. A failure or delay of
either Party to enforce any of the provisions hereof, to exercise any option
which is herein provided, or to require performance of any of the provisions
hereof shall in no way be construed to be a waiver of such provisions or
options.

         29.20    Successors and Assigns

         This Agreement shall be binding on and inure to the benefit of the
Parties and their respective legal successors and permitted assigns.

         29.21    Publicity and Use of Trademarks or Service Marks

         Neither Party nor its subcontractors or agents shall use the other
Party's trademarks, service marks, logos or other proprietary trade dress in any
advertising, press releases, publicity matters or other promotional materials
without such Party's prior written consent.

         29.22    Restructured/New Rates

         Nothing in this Agreement shall affect or limit (i) BA's right with
respect to a new element or service not offered to MGC under this Agreement on
the Effective Date of this Agreement, or (ii) BA's right to modify, restructure
or change an existing element or service and to charge MGC such rates as
approved by the PSC for such modified, restructured or altered element or
service. BA shall be entitled to recover from MGC such new, additional or
restructured rates, charges or prices effective from the date when and to the
extent BA seeks approval from the PSC of such new, additional or restructured
rates, charges or prices, either pursuant to a tariff filing or other
application to the PSC, subject to later true-up on the date such new additional
or restructured rates, charges or prices are actually approved by the PSC.

                                      -77-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         29.23    Integrity of BELL ATLANTIC Network

         The Parties acknowledge that BELL ATLANTIC, at its election, may deploy
fiber throughout its network and that such fiber deployment may inhibit or
facilitate MGC's ability to provide service using certain technologies.
Notwithstanding any other provision of this Agreement, BELL ATLANTIC shall have
the right to deploy, upgrade, migrate and maintain its network at its
discretion.

                                      -78-
<PAGE>

      MGC COMMUNICATIONS, INC. - BELL ATLANTIC Interconnection Agreement

         IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed as of this Third day of April, 1998.
<TABLE>

MGC COMMUNICATIONS, INC.                             BELL ATLANTIC - NEW YORK
<S>                                                  <C>

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

Printed:     Kent F. Heyman                          Printed:       Jacob J. Goldberg
         ---------------------------------                   -------------------------------------

Title: Vice President and General Counsel            Title: President - Telecommunications
       ----------------------------------                -----------------------------------------
                                                                   Industry Services
                                                                ----------------------------------
</TABLE>

                                      -79-<PAGE>

                                                                    EXHIBIT 10.2

                                  PSINET INC.
                        EXECUTIVE STOCK INCENTIVE PLAN
                      (As Amended on September 28, 1999)

     1.   BACKGROUND AND PURPOSE
          ----------------------

          PSINet Inc. (the "Company") hereby establishes the PSINet Inc.
Executive Stock Incentive Plan (the "Plan").  The purpose of this Plan is to
enable the Company to attract and retain employees and consultants and provide
them with an incentive to maintain and enhance the Company's long-term
performance record.  It is intended that this purpose will best be achieved by
granting eligible employees incentive stock options ("ISO's"), non-qualified
stock options ("NQSO's"), stock appreciation rights ("SAR's") and restricted
stock grants, individually or in combination, under this Plan pursuant to the
rules set forth in Sections 83, 162(m), 421 and 422 of the Internal Revenue Code
of 1986, as amended (the "Code").

     2.   ADMINISTRATION
          --------------

          The Plan shall be administered by a Committee of the Company's Board
of Directors (the "Committee").  This Committee shall consist of at least three
members of the Company's Board of Directors each of whom shall, unless the Board
determines otherwise, be "outside directors" as this term is defined in Code
Section 162(m) and regulations thereunder and none of whom during the one-year
period prior to commencement of service on the Committee, or during such
service, has been granted or awarded any equity security or derivative security
of the Company pursuant to the Plan or, except as permitted by Rule 16b-3
(c)(2)(i), or any successor provision, promulgated pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), any other plan of the
Company or any of its affiliates. Subject to the provisions of the Plan, the
Committee shall possess the authority, in its discretion, (a) to determine the
employees of the Company to whom, and the time or times at which, ISO's and/or
NQSO's (ISO's and NQSO's are collectively referred to as "options"), SARs and
restricted stock grants (all four types of grants are collectively referred to
as "awards") shall be granted; (b) to determine at the time of grant whether an
award will be an ISO, a NQSO, a restricted stock grant or a combination of these
awards and the number of shares to be subject to each award; (c) if options are
granted to a participant, whether SARs related to such options shall be granted
to such participant; (d) to prescribe the form of the award agreements and any
appropriate terms and conditions applicable to the awards and to make any
amendments to such agreements or awards; (e) to interpret the Plan; (f) to make
and amend rules and regulations relating to the Plan; and (g) to make all other
determinations necessary or advisable for the administration of the Plan.  The
Committee's determinations shall be conclusive and binding.  No member of the
Committee shall be liable for any action taken or decision made in good faith
relating to the Plan or any award granted hereunder.

     3.   ELIGIBLE EMPLOYEES
          ------------------

          Awards may be granted under the Plan only to employees and consultants
of the Company and its subsidiaries (which shall include all corporations of
which at least fifty percent of the voting stock is owned by the Company
directly or through one or more corporations at least fifty percent of the
voting stock of which is so owned) who have the capability of making a
substantial contribution to the success of the Company. Employees may be awarded
any type of award offered under the Plan.  Consultants may be awarded any type
of award except ISOs.
<PAGE>

     4.   SHARES AVAILABLE
          ----------------

          The total number of shares of the Company's Common Stock (par value of
$0.01 per share) available in the aggregate for awards under this Plan is
15,800,000.  Shares to be granted may be authorized and unissued shares or may
be treasury shares.

          The total number of shares with respect to which restricted stock
awards may be granted to any one participant shall not exceed 10,000 per
calendar year (subject to substitution or adjustment as provided in Section 11).

          If an award expires, terminates or is cancelled without being
exercised or becoming vested, new awards may thereafter be granted under the
Plan covering such shares unless Rule 16b-3 provides otherwise.  No award may be
granted more than 10 years after the effective date of the Plan.

     5.   TERMS AND CONDITIONS OF ISO'S
          -----------------------------

          Each ISO granted under the Plan shall be evidenced by an ISO option
agreement in such form as the Committee shall approve from time to time, which
agreement shall conform with this Plan and contain the following terms and
conditions:

          (a)  Exercise Price. The exercise price under each option shall equal
               --------------
     the fair market value of the Common Stock at the time such option is
     granted. If an option is granted to an officer or employee who at the time
     of grant owns stock possessing more than ten percent of the total combined
     voting power of all classes of stock of the Company (a "10-percent
     Shareholder"), the purchase price shall be at least 110 percent of the fair
     market value of the stock subject to the option.

          (b)  Duration of Option.  Each option by its terms shall not be
               ------------------
     exercisable after the expiration of ten years from the date such option is
     granted. In case of an option granted to a 10-percent Shareholder, the
     option by its terms shall not be exercisable after the expiration of five
     years from the date such option is granted.

          (c)  Options Nontransferable.  Each option by its terms shall not be
               -----------------------
     transferable by the participant otherwise than (i) by will or the laws of
     descent and distribution, (ii) pursuant to a qualified domestic relations
     order, or (iii) to the extent permitted under the option agreement or
     interpretation of the Committee and under Rule 16b-3 promulgated under the
     Exchange Act, by gift to family members or entities beneficially owned by
     family members or other permitted transferees under Rule 16b-3 promulgated
     under the Exchange Act, and shall be exercisable, during the participant's
     lifetime, only by the participant, the participant's guardian or the
     participant's legal representative, the participant's transferee under a
     qualified domestic relations order or other permitted transferee under this
     section.  To the extent required for the option grant and/or exercise to be
     exempt under Rule 16b-3, options (or the shares of Common Stock underlying
     the options) must be held by the participant for at least six months
     following the date of grant.

          (d)  Exercise Terms.  Each option granted under the Plan shall become
               --------------
     exercisable on a schedule to be determined by the Committee at the time of
     grant, which schedule may vary from one grant to another.  Options may be
     partially exercised from

                                      -2-
<PAGE>

     time to time during the period extending from the time they first become
     exercisable until the tenth anniversary (fifth anniversary for a 10-percent
     Shareholder) of the date of grant.

          No outstanding option may be exercised by any person if the employee
     to whom the option is granted is, or at any time after the date of grant
     has been, in competition with the Company.  The Committee has the sole
     discretion to determine whether an employee's actions constitute
     competition with the Company or an affiliated company.  The Committee may
     impose such other terms and conditions on the exercise of options as it
     deems appropriate to serve the purposes for which this Plan has been
     established.

          (e)  Maximum Value of ISO Shares.  No ISO shall be granted to an
               ---------------------------
     employee under this Plan or any other ISO plan of the Company or its
     subsidiaries to purchase shares as to which the aggregate fair market value
     (determined as of the date of grant) of the Common Stock which first become
     exercisable by the employee in any calendar year exceeds $100,000.

          (f)  Payment of Exercise Price.  An option shall be exercised upon
               -------------------------
     written notice to the Company accompanied by payment in full for the shares
     being acquired. The payment shall be made in cash, by check or, if the
     option agreement so permits, by delivery of shares of Common Stock of the
     Company beneficially owned by the participant, duly assigned to the Company
     with the assignment guaranteed by a bank, trust company or member firm of
     the New York Stock Exchange, or by a combination of the foregoing. Any such
     shares so delivered shall be deemed to have a value per share equal to the
     fair market value of the shares on such date. For this purpose, fair market
     value shall equal the closing price of the Company's Common Stock on the
     Nasdaq National Market System on the date the option is exercised, or, if
     there was no trading in such stock on the date of such exercise, the
     closing price on the last preceding day on which there was such trading.

          Subject to the approval of the Board of Directors upon recommendation
     by the Committee, in respect of the exercise of options, the Company may
     loan to the employee a sum equal to an amount which is not in excess of
     100% of the purchase price of the shares so purchased upon exercise, such
     loan to be evidenced by the execution and delivery of a promissory note.
     Interest shall be paid on the unpaid balance of the promissory note at such
     times and at such rate as shall be determined by the Board of Directors.
     Such promissory note shall be secured by the pledge to the Company of
     shares having an aggregate purchase price on the date of exercise equal to
     or greater than the principal amount of such note. An optionee shall have,
     as to such pledged shares, all rights of ownership, including the right to
     vote such shares and to receive dividends paid on such shares, subject to
     the security interest of the Company.  Such shares shall not be released by
     the Company from the pledge unless the proportionate amount of the note
     secured thereby has been repaid to the Company.  All notes executed
     hereunder shall be payable at such times and in such amounts and shall
     contain such other terms as shall be specified by the Board of Directors,
     provided, however, that such terms shall conform to requirements contained
     in any applicable regulations which are issued by any governmental
     authority.

                                      -3-
<PAGE>

     6.   TERMS AND CONDITIONS FOR NQSO'S
          -------------------------------

          Each NQSO granted under the Plan shall be evidenced by a NQSO option
agreement in such form as the Committee shall approve from time to time, which
agreement shall conform to this Plan and contain the same terms and conditions
as the ISO option agreement except that the 10-percent Shareholder restrictions
in Sections 5(a) and 5(b) and the maximum value of share rules of Section 5(e)
shall not apply to NQSO grants.  To the extent an option initially designated as
an ISO exceeds the value limit of Section 5(e), it shall be deemed a NQSO and
shall otherwise remain in full force and effect.

     7.   TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS
          -------------------------------------------------

          To the extent permitted under Rule 16b-3 promulgated under the
Exchange Act, the Committee may, in its discretion, award stock appreciation
rights to any eligible employee of the Company who is subject to Section 16(b)
of the Exchange Act in conjunction with incentive stock options or nonqualified
stock options then being granted to him, or to be attached to one or more such
options theretofore granted and at the time held unexercised by such employee
which shall entitle the employee to receive payment from the Company in
accordance with the following provisions and such other terms and conditions as
the Committee shall determine from time to time:

          (a)  An SAR granted hereunder may be made part of an option at the
               time of grant of the option or at any time thereafter up to six
               months prior to the expiration of the option.

          (b)  Such SAR will entitle the holder to elect to receive, in lieu of
               exercising the option to which it relates, an amount (in cash or
               in Common Stock, or a combination thereof, all in the sole
               discretion of the Committee) equal to 100% of the excess of:

               (1)  the fair market value per share of the Company's Common
                    Stock on the date of exercise of such right, multiplied by
                    the number of shares with respect to which the right is
                    being exercised, over

               (2)  the aggregate option exercise price for such number of
                    shares.

          (c)  Such SAR will be exercisable only to the extent that it has a
               positive value and the option to which it relates is exercisable,
               except that no SAR shall be exercisable during the first six (6)
               months after the date of its grant.

          (d)  Upon exercise of an SAR, the option (or portion thereof) with
               respect to which such right is exercised shall be surrendered and
               shall not thereafter be exercisable.

          (e)  The exercise of an SAR will reduce the number of shares
               purchasable pursuant to the related option and available under
               the Plan to the extent of the number of shares with respect to
               which the right is exercised.

                                      -4-
<PAGE>

     8.   TERMS AND CONDITIONS OF RESTRICTED STOCK GRANTS
          -----------------------------------------------

          The Committee may, evidenced by such written agreement as the
Committee shall from time to time prescribe, grant to an eligible employee a
specified number of shares of the Company's Common Stock which shall vest only
after the attainment of the relevant restrictions described below ("restricted
stock").  Such restricted stock shall have an appropriate restrictive legend
affixed thereto.  A restricted stock grant shall be neither an option nor a
sale, but shall be subject to the following conditions and restrictions:

          (a)  Restricted stock may not be sold or otherwise transferred by the
               participant until ownership vests, provided however, to the
               extent required for the restricted stock grant to be exempt under
               Rule 16b-3, the restricted stock must be held by the participant
               for at least six months following the date of vesting.

          (b)  Ownership shall vest only following satisfaction of one or more
               of the following criteria as the Committee may prescribe:

               (1)  the passage of three years, or such longer period of time as
                    the Committee in its discretion may provide, from the date
                    of grant.

               (2)  the attainment of performance-based goals established by the
                    Committee as of the date of grant.  If the participant's
                    compensation is subject to the $1 million cap of Code
                    Section 162(m), the Committee may establish such performance
                    goals based on one or more of the following targets:

                    .    total shareholder return

                    .    earnings per share growth

                    .    cash flow growth

                    .    return on equity and/or

                    If the participant's compensation is not subject to the $1
                    million cap of Code Section 162(m), the Committee may
                    establish the performance goal on the basis of the preceding
                    four targets or any other target it may from time to time
                    deem appropriate in its discretion.

               (3)  any other conditions the Committee may prescribe, including
                    a non-compete requirement.

          (c)  Unless the Committee shall determine otherwise with respect to
               participants whose compensation is not governed by Code Section
               162(m), the Committee shall grant and administer all performance-
               based awards under (b)(2) above with the intent of meeting the
               criteria of Code Section 162(m) for performance-based
               compensation.  To this end, the outcome of all targeted goals
               shall be substantially uncertain on the date of grant; the goals
               shall be established no later than 90 days following the
               commencement of service to which the goals relate; the minimum
               period

                                      -5-
<PAGE>

               for attaining each performance goal shall be one year; and the
               Committee shall certify at the conclusion of the performance
               period whether the performance-based goals have been attained.
               Such certification may be made by noting the attainment of the
               goals in the minutes of the Committee's meetings.

          (d)  Except as otherwise determined by the Committee, all rights and
               title to restricted stock granted to a participant under the Plan
               shall terminate and be forfeited to the Company upon failure to
               fulfill all conditions and restrictions applicable to such
               restricted stock.

          (e)  Except for the restrictions set forth in this Plan and those
               specified by the Committee in any restricted stock agreement, a
               holder of restricted stock shall possess all the rights of a
               holder of the Company's Common Stock (including voting and
               dividend rights); provided, however, that prior to vesting the
               certificates representing such shares of restricted stock (and
               the amount of any dividends issued with respect thereto) shall be
               held by the Company for the benefit of the participant and the
               participant shall deliver to the Company a stock power executed
               in blank covering such shares.  As the shares vest, certificates
               representing such shares shall be released to the participant.

          (f)  All other provisions of the Plan not inconsistent with this
               section shall apply to restricted stock or the holder thereof, as
               appropriate, unless otherwise determined by the Committee.

     9.   GENERAL RESTRICTION ON ISSUANCE OF STOCK CERTIFICATES
          -----------------------------------------------------

          The Company shall not be required to deliver any certificate upon the
grant, vesting or exercise of any award or option until it has been furnished
with such opinion, representation or other document as it may reasonably deem
necessary to ensure compliance with any law or regulation of the Securities and
Exchange Commission or any other governmental authority having jurisdiction
under this Plan.  Certificates delivered upon such grant, vesting or exercise
may bear a legend restricting transfer absent such compliance.  Each award shall
be subject to the requirement that, if at any time the Committee shall
determine, in its discretion, that the listing, registration or qualification of
the shares subject to such award upon any securities exchange or under any state
or federal law, or the consent or approval of any governmental regulatory body,
is necessary or desirable as a condition of, or in connection with, the granting
of such awards or the issue or purchase of shares thereunder, such awards may
not vest or be exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or obtained free of
any conditions not acceptable to the Committee in the exercise of its reasonable
judgment.

     10.  IMPACT OF TERMINATION OF EMPLOYMENT
          -----------------------------------

          (a)  Options
               -------

          If the employment of a participant terminates by reason of death or
disability (as determined by the Committee), any option may be exercised by the
participant or, in the event of the participant's death, by the participant's
personal representative any time prior to the earlier of

                                      -6-
<PAGE>

the expiration date of the option or the expiration of one year after the date
of termination, but only if, and to the extent that, the participant was
entitled to exercise the option at the date of such termination. Upon
termination of the participant's employment for any reason other than death or
disability, any vested option that was exercisable immediately preceding
termination may be exercised at any time prior to the earlier of the expiration
date of the option or the expiration of three months after the date of such
termination. In the event of retirement, the three month period specified in the
preceding sentence shall be extended to one year in the case of NQSOs.
Notwithstanding the foregoing, an option may not be exercised after termination
of employment if the Committee reasonably determines that the termination of
employment of such participant resulted from willful acts or failure to act by
the participant detrimental to the Company or any of its subsidiaries.

          (b)  Restricted Stock Grants

          (i)  Passage of Time Vesting.  If a participant has been awarded
               -----------------------
restricted stock whose vesting is conditioned solely on the passage of time, any
termination of employment for any reason, shall result in the forfeiture of all
restricted stock awards that were not vested prior to the termination of
employment except as otherwise provided by the Committee.

          (ii) Performance-Based Vesting.  If a participant has been awarded
               -------------------------
restricted stock whose vesting is based solely on the attainment of performance-
based goals or partly on the attainment of performance-based goals and partly on
the passage of time, any termination of employment except death, disability or
retirement shall result in the forfeiture of all restricted stock awards that
were not vested prior to the termination of employment. A participant who
terminates employment on account of death, disability or retirement may, if the
performance-based criteria are eventually attained, be awarded (or, in the event
of death, the participant's designated beneficiary or personal representative if
there is no designated beneficiary shall be awarded) up to a pro rata portion of
the restricted shares based on the participant's length of service as of his or
her termination of employment over the length of the award period ending on the
date the performance-based criteria are satisfied (or the passage of time would
have been satisfied, if later, for an award based in part on performance goals
and in part on the passage of time). The Committee shall have the discretion
whether to grant a full pro rata portion of the restricted shares, a lesser
portion or no shares at all under this subsection (b)(ii).

          (c)  SARs
               ----

          If a participant terminates employment while holding an unexercised
SAR, the participant, or his designated beneficiary (or legal representative if
there is no designated beneficiary) in the event of his death, may exercise the
SAR to the same extent as the option to which it is related may be exercised
following termination of employment.

          (d)  Miscellaneous Termination Provisions
               ------------------------------------

          Unless otherwise determined by the Committee, an authorized leave of
absence shall not constitute a termination of employment for purposes of this
Plan.

          For purposes of this section, retirement means that a participant
terminates employment at or after the date on which the participant reaches any
normal retirement age specified in any policy adopted by the Board or, in the
absence of such policy, age 65.

                                      -7-
<PAGE>

          If the employment of a participant terminates for any reason other
than disability, retirement or death, any unpaid balance on any promissory note
used in the purchase of stock shall become due and payable upon not less than
three months' notice from the Company, which notice may be given at any time
after such termination; provided, however, that such unpaid balance on such
promissory note shall become due and payable five years from the date of such
termination, unless the note has an earlier due date.  In the case of
termination due to death, any unpaid balance remaining on such note on the date
of death shall become due and payable one year from such date.

     11.  ADJUSTMENT OF SHARES
          --------------------

          In the event of any change in the Common Stock of the Company by
reason of any stock dividend, stock split, recapitalization, reorganization,
merger, consolidation, split-up, combination, or exchange of shares, or of any
similar change affecting the Common Stock, the number and kind of shares
authorized under Section 4, the number and kind of shares which thereafter are
subject to an award under the Plan and the number and kind of unexercised
options and unvested shares set forth in awards under outstanding agreements and
the price per share shall be adjusted automatically consistent with such change
to prevent substantial dilution or enlargement of the rights granted to, or
available for, participants in the Plan.

     12.  WITHHOLDING TAXES
          -----------------

          All cash payable to a participant under the terms of this Plan shall
be subject to such federal, state and local income and employment tax
withholdings as payments of this type are normally subject.  Whenever the
Company proposes or is required to issue or transfer shares of Common Stock
under the Plan, or whenever restricted stock vests, the Company shall have the
right to require the recipient to remit to the Company an amount sufficient to
satisfy any federal, state and/or local income and employment withholding tax
requirements prior to the delivery of any certificate or certificates for such
shares or to take any other appropriate action to satisfy such withholding
requirements.  Notwithstanding the foregoing, subject to such rules as the
Committee may promulgate and compliance with any requirements under Rule 16b-3,
the recipient may satisfy such obligation in whole or in part by electing to
have the Company withhold shares of Common Stock from the shares to which the
recipient is otherwise entitled.

     13.  NO EMPLOYMENT RIGHTS
          --------------------

          The Plan and any awards granted under the Plan shall not confer upon
any participant any right with respect to continuance as an employee of the
Company or any subsidiary, nor shall they interfere in any way with the right of
the Company or any subsidiary to terminate the participant's position as an
employee at any time.

     14.  RIGHTS AS A SHAREHOLDER
          -----------------------

          The recipient of any option under the Plan shall have no rights as a
shareholder with respect thereto unless and until certificates for the
underlying shares of Common Stock are issued to the recipient.  The recipient of
a restricted stock grant shall have all rights of a shareholder except as
otherwise limited by the terms of this Plan.

                                      -8-
<PAGE>

     15.  AMENDMENT AND DISCONTINUANCE
          ----------------------------

          This Plan may be amended, modified or terminated by the Committee or
by the shareholders of the Company, except that the Committee may not, without
approval of a majority of the shareholders present in person or by proxy,
materially increase the benefits accruing to participants under the Plan,
materially increase the maximum number of shares as to which awards may be
granted under the Plan, increase the number of restricted stock grants per year
per participant or change the basis for making performance-based awards for
participants whose compensation is subject to Code Section 162(m), change the
minimum exercise price of options or SARs, change the class of eligible persons,
extend the period for which awards may be granted or exercised, or withdraw the
authority to administer the Plan from the Committee or a committee of the
Committee consisting solely of outside directors unless the Board determines
that inside directors may serve on the Committee.  Notwithstanding the
foregoing, to the extent permitted by law, the Committee may amend the Plan
without the approval of shareholders, to the extent it deems necessary to cause
the Plan to comply with Securities and Exchange Commission Rule 16b-3 or any
successor rule, as it may be amended from time to time or as otherwise permitted
under Rule 16b-3 promulgated under the Exchange Act and the Code.  Except as
required by law, no amendment, modification, or termination of the Plan may,
without the written consent of a participant to whom any award shall theretofore
have been granted, adversely affect the rights of such participant under such
award.

     16.  CHANGE IN CONTROL
          -----------------

          (a)  Notwithstanding other provisions of the Plan, in the event of a
     change in control of the Company (as defined in subsection (c) below), all
     of a participant's restricted stock awards shall become immediately vested
     to the same extent as if all restrictions had been satisfied and all
     options and SARs shall become immediately vested and exercisable, unless
     directed otherwise by a resolution of the Committee adopted prior to and
     specifically relating to the occurrence of such change in control.

          (b)  In the event of a change in control each participant holding an
     exercisable option (i) shall have the right at any time thereafter during
     the term of such option to exercise the option in full notwithstanding any
     limitation or restriction in any option agreement or in the Plan, and (ii)
     if no related SAR has been granted with respect to an option, may, subject
     to Committee approval and after written notice to the Company within 60
     days after the change in control, or, if the participant is an officer
     subject to Section 16 of the Exchange Act and to the extent required to
     exempt the transaction under Rule 16b-3, during the period beginning on the
     third business day and ending on the twelfth business day following the
     first release for publication by the Company after such change of control
     of a quarterly or annual summary statement of earnings, which release
     occurs at least six months following grant of the option, whichever period
     is longer, receive, in exchange for the surrender of the option or any
     portion thereof to the extent the option is then exercisable in accordance
     with clause (i), an amount of cash equal to the difference between the fair
     market value (as determined by the Committee) on the date of surrender of
     the Common Stock covered by the option or portion thereof which is so
     surrendered and the option price of such Common Stock under the option.

          (c)  For purposes of this section, "change in control" means:

          (1)  there shall be consummated

                                      -9-
<PAGE>

               i.   any consolidation or merger of the Company in which the
                    Company is not the continuing or surviving corporation or
                    pursuant to which any shares of the Company's common stock
                    are to be converted into cash, securities or other property,
                    provided that the consolidation or merger is not with a
                    corporation which was a wholly-owned subsidiary of the
                    Company immediately before the consolidation or merger; or

               ii.  any sale, lease, exchange or other transfer (in one
                    transaction or a series of related transactions) of all, or
                    substantially all, of the assets of the Company (other than
                    to one or more directly or indirectly wholly-owned
                    subsidiaries of the Company); or

          (2)  the shareholders of the Company approve any plan or proposal for
               the liquidation or dissolution of the Company; or

          (3)  any person (as such term is used in Sections 13(d) and 14(d) of
               the Exchange Act) shall become the beneficial owner (within the
               meaning of Rule 13d-3 under the Exchange Act), directly or
               indirectly, of 30% or more of the Company's then outstanding
               common stock, provided that such person shall not be a wholly-
               owned subsidiary of the Company immediately before it becomes
               such 30% beneficial owner; or

          (4)  individuals who constitute the Company's Board of Directors on
               the date hereof (the "Incumbent Board") cease for any reason to
               constitute at least a majority thereof, provided that any person
               becoming a director subsequent to the date hereof whose election,
               or nomination for election by the Company's shareholders, was
               approved by a vote of at least three quarters of the directors
               comprising the Incumbent Board (either by a specific vote or by
               approval of the proxy statement of the Company in which such
               person is named as a nominee for director, without objection to
               such nomination) shall be, for purposes of this clause (d),
               considered as though such person were a member of the Incumbent
               Board.

     17.  EFFECTIVE DATE
          --------------

          The effective date of the Plan is March 1, 1995 provided that within
12 months of this date the Plan is approved by the affirmative vote of the
owners of a majority of the Company's outstanding shares of Common Stock.

     18.  DEFINITIONS
          -----------

          Any terms or provisions used herein which are defined in Sections 83,
162(m), 421, or 422 of the Internal Revenue Code as amended, or the regulations
thereunder or corresponding provisions of subsequent laws and regulations in
effect at the time awards are made hereunder, shall have the meanings as therein
defined.

                                      -10-
<PAGE>

     19.  GOVERNING LAW
          -------------

          To the extent not inconsistent with the provisions of the Internal
Revenue Code that relate to awards, this Plan and any award agreement adopted
pursuant to it shall be construed under the laws of the State of New York.

Amended as of September 28, 1999      PSINET INC.

                                      By: /s/ William L. Schrader
                                         ------------------------
                                           William L. Schrader
                                           Chairman and Chief Executive Officer

Date of Shareholder Approval:  September 28, 1999

                                      -11-

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