Document:

Exhibit 4(vv)

                           DATED 14th MARCH, 2005
                           ----------------------

          (1)  CHINA NETCOM GROUP CORPORATION (BVI) LIMITED

               AND

          (2)  CHINA NETCOM CORPORATION (BVI) LIMITED

               AND

          (3)  CHINA NETWORK COMMUNICATIONS GROUP CORPORATION

               AND

          (4)  PCCW LIMITED

                     ---------------------------------------------
                                   DEED OF ASSIGNMENT
                       in relation to the Subscription Agreement
                                dated 19th January, 2005
                     ---------------------------------------------

                               Slaughter and May
                           47th Floor, Jardine House
                              One Connaught Place
                               Central, Hong Kong
                                 (ANH/LHYY/VPM)

                                  HK050320155
<PAGE>

THIS DEED OF ASSIGNMENT is entered into on the day 14th of March, 2005

BETWEEN:-

(1)  CHINA NETCOM GROUP CORPORATION (BVI) LIMITED, (the "Subscriber"), a company
     incorporated in the British Virgin Islands and whose registered office is
     at P.O. Box 3140, Wickhams Cay 1, Road Town, Tortola, British Virgin
     Islands (Business registration number 341457); AND

(2)  CHINA NETCOM CORPORATION (BVI) LIMITED, (the "Alternate Subscriber"), a
     company incorporated in the British Virgin Islands and whose registered
     office is at P.O. Box 3140, Wickhams Cay 1, Road Town, Tortola, British
     Virgin Islands (Business registration number 637903);

     AND

(3)  CHINA NETWORK COMMUNICATIONS GROUP CORPORATION, ("China Netcom"), a
     state-owned enterprise established under the laws of the People's Republic
     of China and whose registered office is at Block C, No. 156 Fuxingmen Nei
     Da Jie, Xi Cheng District, Beijing, People's Republic of China;

     AND

(4)  PCCW LIMITED, (the "Company"), a company incorporated in Hong Kong with
     limited liability and whose registered office is at 39th Floor, PCCW Tower,
     TaiKoo Place, 979 King's Road, Quarry Bay, Hong Kong.

WHEREAS:-

(A)  The Subscriber, the Company and China Netcom entered into a Subscription
     Agreement dated 19th January, 2005 pursuant to which the Subscriber
     conditionally agreed to subscribe for 1,343,571,766 new Shares in the
     Company at a price of HK$5.90 per Share (the "Subscription Shares").

(B)  Clause 4.4 of the Subscription Agreement entitles the Subscriber to assign
     all of its rights under the Subscription Agreement (including the right to
     subscribe for and be issued and allotted the Subscription Shares at
     completion of the Subscription and the rights and benefit of and to the
     Company Warranties) to a company which is wholly-owned by the Subscriber.

(C)  The Subscriber wishes to assign its rights, title and interest in, to and
     under the Subscription Agreement to the Alternate Subscriber. The Alternate
     Subscriber is wholly-owned by the Subscriber, which in turn is wholly-owned
     by China Netcom.

<PAGE>

                                        2

NOW IT IS AGREED as follows:-

2. DEFINITIONS AND INTERPRETATION

2.1  In this Deed (including the Recitals):-

     (A)  capitalised words used but not defined in this Deed shall bear the
          meanings given to them in the Subscription Agreement; and

     (B)  rules of construction and interpretation set out in the Subscription
          Agreement shall apply to this Deed.

2.2  In this Deed, unless otherwise specified:-

     (A)  references to clauses and sub-clauses are to clauses and sub-clauses
          of this Deed; and

     (B)  headings to clauses and schedules are for convenience only and do not
          affect the interpretation of this Deed.

3. ASSIGNMENT

3.1  With effect from the date of this Deed and in consideration of the
     undertakings given by the Alternate Subscriber in clause 4 and the Company
     in clause 5, the Subscriber hereby assigns all of its rights, title and
     interest in, to and under the Subscription Agreement to the Alternate
     Subscriber including:-

     (A)  the right to subscribe for the Subscription Shares at the Subscription
          Price, free from Encumbrances on the terms and subject to the
          conditions set out in the Subscription Agreement;

     (B)  the benefit of the Company Warranties and all other undertakings given
          by the Company to the Subscriber under the Subscription Agreement.

3.2  Notwithstanding the provisions of sub-clause 3.1 and any other provision of
     this Deed, the Subscriber agrees that it shall remain liable for any breach
     by it of the Subscription Agreement, and shall remain bound to perform and
     comply with all its covenants, undertakings and obligations under the
     Subscription Agreement in the event of breach of the Subscription Agreement
     by the Alternate Subscriber (including, without limitation, the obligation
     to subscribe for and pay for the Subscription Shares).

4.   ALTERNATE SUBSCRIBER'S UNDERTAKINGS

4.1  With effect from the date of this Deed and in consideration of the
     undertakings given by the Company in clause 5 and the Subscriber in clause
     6, the Alternate Subscriber hereby undertakes to observe, perform,
     discharge and be bound by the Subscription Agreement as if it were a party
     to the Subscription Agreement in the place of the Subscriber (including,
     without limitation, the obligation to subscribe for and pay for the
     Subscription Shares).

<PAGE>
                                        3

4.2  Notwithstanding the provisions of sub-clause 4.1, nothing in this Deed
     shall:-

     (A)  require the Alternate Subscriber to perform any obligation of the
          Subscriber created by or arising under the Subscription Agreement
          falling due for performance, or which should have been performed,
          before the date of this Deed; or

     (B)  make the Alternate Subscriber liable for any act, neglect, default or
          omission in respect of the Subscription Agreement committed by the
          Subscriber or occurring before the date of this Deed.

5.   THE COMPANY'S UNDERTAKINGS

5.1  With effect from the date of this Deed and in consideration of the
     undertakings given by the Alternate Subscriber in clause 4 and the
     Subscriber in clause 6, the Company hereby:-

     (A)  confirms its consent to and approval of the assignment of the
          Subscriber's rights, title and interest in, to and under the
          Subscription Agreement to the Alternate Subscriber pursuant to clause
          3 above;

     (B)  accepts the Alternate Subscriber's undertaking to observe, perform,
          discharge and be bound by the Subscription Agreement pursuant to
          clause 4 above;

     (C)  confirms that it has received the requisite written notice required
          pursuant to clause 4.4 (B) of the Subscription Agreement; and

     (D)  agrees to observe, perform, discharge and be bound by the Subscription
          Agreement as if the Alternate Subscriber were a party to and executed
          the Subscription Agreement in the place of the Subscriber, including,
          without limitation, undertaking to issue the Subscription Shares to
          the Alternate Subscriber (rather than the Subscriber), but subject to
          the other terms and conditions of the Subscription Agreement.

5.2  Notwithstanding the provisions of sub-clause 5.1:-

     (A)  nothing in this Deed shall affect or prejudice any claim or demand
          whatsoever which the Company may have against the Subscriber in
          relation to the Subscription Agreement; and

     (B)  nothing in this Deed shall affect or prejudice any claim or demand
          whatsoever which the Company may have against the Subscriber under the
          Subscription Agreement in the event that the Alternate Subscriber is
          in breach of its obligations under this Deed and/or the Subscription
          Agreement (including, without limitation, the obligation to subscribe
          for and pay for the Subscription Shares).

<PAGE>
                                        4

6.   REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS OF THE SUBSCRIBER AND THE
     ALTERNATE SUBSCRIBER

6.1  Subscriber

     The Subscriber hereby undertakes, represents and warrants to the Company as
     follows:-

     (A)  It is the legal and beneficial owner of the whole of the issued share
          capital of the Alternate Subscriber.

     (B)  China Netcom is the legal and beneficial owner of the whole of the
          issued share capital of the Subscriber, and the Subscriber is the
          legal and beneficial owner of all the issued shares in CNC HK held by
          the CNC Group.

6.2  Alternate Subscriber

     The Alternate Subscriber hereby undertakes, represents and warrants to the
     Company:-

     (A)  As at the date of this Deed it has (subject to the obtaining by China
          Netcom of the approval of the PRC State Council), and on the
          Completion Date it will have, the full right, power and authority to
          enter into, and to perform its obligations under, this Deed and this
          Deed constitutes its legal, valid and binding obligations enforceable
          in accordance with its terms.

     (B)  As at the date of this Deed it has (subject to the obtaining by China
          Netcom of the approval of the PRC State Council), and on the
          Completion Date it will have, obtained all governmental, regulatory or
          similar consents required from any Authority, authorities, approvals
          and permissions required to enter into, and to perform its obligations
          under, this Deed and there are no regulatory or administrative
          obstacles to the remittance of the Subscription monies to the Company
          in Hong Kong in accordance with the terms of this Deed and the
          Subscription Agreement.

     (C)  The Subscriber is the legal and beneficial owner of the whole of the
          issued share capital of the Alternate Subscriber, and no person has
          any outstanding warrant, option, pre-emptive right or any other right
          of any description to require shares to be allotted or issued by the
          Alternate Subscriber.

     (D)  The execution, delivery and performance by it of this Deed does not
          and will not result in a material breach of any provision in its
          memorandum or articles of association or other constitutional
          documents.

     (E)  No order has been made and no resolution has been passed for the
          winding up of the Alternate Subscriber or for a provisional liquidator
          to be appointed in respect of it and no petition has been presented
          and no meeting has been convened for the purposes of winding up the
          Alternate Subscriber.

<PAGE>
                                       5

     (F)  No administration order has been made and no petition for such an
          order has been presented in respect of the Alternate Subscriber.

     (G)  No receiver (which expression shall include an administrative
          receiver) has been appointed in respect of the Alternate Subscriber.

     (H)  The Alternate Subscriber is not insolvent or unable to pay its debts
          and has not stopped paying its debts as they fall due.

     (I)  No event analogous to any described in paragraphs (E) to (H) has
          occurred in or outside the British Virgin Islands with respect to the
          Alternate Subscriber.

     (J)  Under the laws of the British Virgin Islands, neither the Alternate
          Subscriber nor any of its properties, assets or revenues are entitled
          to any right of immunity on the grounds of sovereignty from any legal
          action, suit or proceedings, from set-off or counter claim, from the
          jurisdiction of any court or arbitral tribunal, from service of
          process, from attachment prior to or in aid of execution of judgment
          or arbitral award, or from other legal process or proceedings for the
          giving of any relief or for the enforcement of any judgment or
          arbitral award.

     (K)  Neither the Alternate Subscriber nor any of its directors or Principal
          Officers, is a Disqualified Person.

6.3  Repetition of Subscriber/Alternate Subscriber Warranties, etc

     (A)  The representations and warranties set out in clauses 6.1 and 6.2 are
          given as at the date hereof and shall be deemed to be repeated by the
          Subscriber and the Alternate Subscriber respectively on the Completion
          Date as if given or made on such date, with reference in each case to
          the facts and circumstances then subsisting.

     (B)  Each of the Subscriber and the Alternate Subscriber undertakes to
          disclose in writing to the Company anything which will be or is
          reasonably likely to be a breach of any of the representations and
          warranties set out in clauses 6.1 and 6.2 on and as at the Completion
          Date promptly after such thing comes to its notice both prior to and
          on the Completion Date. Each of the Subscriber and the Alternate
          Subscriber agrees promptly to provide such information as may be
          reasonably requested by the Company, from the date hereof until the
          Completion Date, in order to enable the Company to assess whether a
          breach of any representations and warranties set out in clauses 6.1
          and 6.2 will occur on the Completion Date.

7.   CHINA NETCOM GUARANTEE

7.1  Guarantee Obligations

     In consideration of the Company entering into this Deed at the request of
     China Netcom (as China Netcom hereby acknowledges), China Netcom shall as
     primary obligations of it:

<PAGE>
                                       6

     (A)  procure that the Alternate Subscriber shall duly observe and perform
          all its obligations owed to the Company under this Deed and the
          Subscription Agreement or any other agreement entered pursuant or
          ancillary to such documents;

     (B)  if and whenever the Alternate Subscriber shall be in default in the
          payment when due of any amount payable to the Company under this Deed
          and/or the Subscription Agreement or any other agreement entered into
          pursuant or ancillary to such documents and within two Business Days
          after being given notice to that effect by the Company, pay to the
          Company all amounts then so payable by the Alternate Subscriber to the
          Company as though China Netcom instead of the Alternate Subscriber was
          expressed to be the principal debtor; and

     (C)  indemnify the Company against all costs and expenses (including legal
          fees) which the Company may pay or incur in collecting any amount
          payable by the Alternate Subscriber or China Netcom and referred to in
          clause 7.1(B).

7.2  Indemnity

     Any amount not paid by the Alternate Subscriber and not recoverable from
     China Netcom on the basis of a guarantee (whether because of any legal
     limitation, disability or incapacity on the part of the Alternate
     Subscriber or any other matter or thing whether known to the Company or
     not) shall nevertheless be recoverable from China Netcom on the basis of an
     indemnity.

7.3  Indulgence etc.

     (A)  China Netcom acknowledges that its liability under this clause 7 shall
          not be discharged or affected in any way by time being given to the
          Alternate Subscriber or by any other indulgence or concession being
          granted to the Alternate Subscriber or by any other act, omission,
          dealing, matter or thing whatsoever (including without limitation any
          change in the constitution of the Alternate Subscriber or China
          Netcom, any amendment to this Deed and/or the Subscription Agreement
          or any such other agreement entered pursuant or ancillary hereto or
          the liquidation, dissolution, reconstruction or amalgamation of the
          Alternate Subscriber or China Netcom or the illegality or
          unenforceability of this Deed or such other agreement) which but for
          this provision might operate to release China Netcom from its
          obligations under this clause 7.

     (B)  China Netcom acknowledges and agrees that its liability under clause
          10 of the Subscription Agreement shall not be discharged or affected
          in any way by the assignment by the Subscriber of its rights, title
          and interest in, to and under the Subscription Agreement to the
          Alternate Subscriber pursuant to this Deed.

7.4  Continuing Guarantee

     The guarantee contained in this clause 7 is a continuing guarantee and
     shall remain in full force and effect until all obligations of the
     Alternate Subscriber hereby guaranteed

<PAGE>
                                       7

     have been discharged in full. It is in addition to and shall not prejudice
     nor be prejudiced by any other guarantee, indemnity or other security or
     right against any third party which the Company may have for the due
     performance of the obligations concerned.

8.   WAIVER OF IMMUNITY

8.1  Immunity

     It is acknowledged that the status of China Netcom in the PRC may afford it
     certain protections and immunities not available to entities wholly
     independent of any state body in the PRC and China Netcom has therefore
     agreed to waive such protections and immunities as set out below.

8.2  Waiver

     China Netcom irrevocably and unconditionally agrees with the Company that
     in respect of any proceedings brought against China Netcom or its assets by
     the Company in relation to this Deed or any other agreement entered into
     pursuant to or as a result of this Deed:

     (A)  no immunity from those proceedings (including, without limitation,
          suit, attachment prior to judgement, other attachment, the obtaining
          of any judgement, execution or other enforcement, or the enforcement
          and execution of any award rendered by an arbitral tribunal
          constituted pursuant to this Deed) will be claimed by or on behalf of
          itself or with respect to its assets;

     (B)  China Netcom shall (and hereby) waives any such right of immunity
          which it or its assets now has or may subsequently acquire; and

     (C)  China Netcom consents generally in respect of any such proceedings to
          the giving of any relief or the issue of any process in connection
          with those proceedings, including, without limitation, the making,
          enforcement or execution against any assets whatsoever (irrespective
          of its use or intended use) of any order or judgement which may be
          made or given in those proceedings or of any award rendered by an
          arbitral tribunal constituted pursuant to this Deed.

9.   CHOICE OF GOVERNING LAW

9.1  This Deed shall be governed by and construed in accordance with the laws of
     England for the time being in force.

10.  ARBITRATION

10.1 Any dispute, controversy or claim arising out of or in connection with this
     Deed, including any question regarding its existence, validity or
     termination, shall be referred to and finally resolved by arbitration under
     the LCIA Rules, which Rules are deemed to be incorporated by reference into
     this clause. The arbitration commission shall be the LCIA.

10.2 The number of arbitrators shall be three.

<PAGE>
                                       8

10.3 The seat of the arbitration shall be London.

10.4 The language to be used in the arbitral proceedings shall be English.

10.5 By agreeing to arbitration pursuant to this clause, the Parties waive
     irrevocably their right to any form of appeal, review or recourse to any
     state court or other judicial authority, insofar as such waiver may validly
     be made. In particular, no Party may apply to the court to determine any
     question of law arising in the course of the arbitration pursuant to
     section 45 of the Arbitration Act 1996 or otherwise, and no Party may
     appeal to the court on a question of law arising out of an award made in
     the arbitration pursuant to section 69 of the Arbitration Act 1996 or
     otherwise.

10.6 The Parties shall have the right to seek interim injunctive relief from a
     court of competent jurisdiction, both before and after the arbitrators have
     been appointed, at any time up until the arbitrators have made the final
     award.

11.  CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

11.1 No person who is not for the time being a Party to this Deed shall have any
     right under the Contracts (Rights of Third Parties) Act 1999 to enforce any
     term of this Deed.

12.  COUNTERPARTS

12.1 This Deed may be executed in any number of counterparts, which shall
     together constitute one deed. Any Party may enter into this Deed by signing
     any such counterpart.

13.  WHOLE AGREEMENT

13.1 This Deed, together with any documents referred to in it, constitutes the
     whole agreement between the Parties relating to its subject matter and
     supersedes and extinguishes any prior drafts, agreements, and undertakings,
     whether in writing or oral, relating to such subject matter, except to the
     extent that the same are repeated in this Deed.

13.2 Each of the Parties acknowledges that it has not been induced to enter into
     this Deed by any representation, warranty, promise or assurance by any of
     the others or any other person save for those contained in this Deed.

14.  VARIATIONS

14.1 No variation of this Deed shall be effective unless made in writing and
     signed by each of the Parties to this Deed.

14.2 No variation of the Subscription Agreement after the execution of this Deed
     shall be effective unless made in writing and signed by each of the Parties
     to this Deed.

14.3 The Company, the Subscriber and China Netcom each undertake and confirm to
     each other and to the Alternate Subscriber that there has been no variation
     or amendment of the Subscription Agreement (whether oral, written or
     otherwise) prior to the execution

<PAGE>
                                       9

     this Deed, and each of them agree and acknowledge that the Subscription
     Agreement in the form annexed to this Deed and marked "A" for the purposes
     of identification constitutes the whole and only agreement between them
     relating to the subscription of, and issue and allotment of the
     Subscription Shares.

15.  FURTHER ASSURANCE

15.1 At any time after the Completion Date every Party hereto shall, at the
     request of any other Party and at such requesting Party's cost, execute or
     procure the execution of such documents and do or procure the doing of such
     acts and things as the requesting Party may reasonably require for the
     purpose of vesting in the requesting Party or its permitted assignees the
     full benefit of all its rights in this Deed.

16.  COSTS

16.1 Each Party shall bear its own costs arising out of or in connection with
     the preparation, negotiation and implementation of this Deed.

17.  DEED BINDING AND ASSIGNMENT

17.1 This Deed shall be binding on and enure for the benefit of each Party's
     respective successors and permitted assigns. No Party shall assign any of
     its rights under this Deed (all of which shall be incapable of assignment)
     or purport to do so without the prior written consent of the other Parties.

18.  WAIVER

18.1 No failure or delay by any Party in exercising any right, power or remedy
     under this Deed shall operate as a waiver thereof, nor shall any single or
     partial exercise of the same preclude any further exercise thereof or the
     exercise of any other right, power or remedy. Without limiting the
     foregoing, no waiver by any Party of any breach of any provision hereof
     shall be deemed to be a waiver of any subsequent breach of that or any
     other provision hereof.

19.  INVALIDITY AND SEVERANCE

19.1 If any provision of this Deed shall be held to be illegal, void, invalid or
     unenforceable under the laws of any jurisdiction, the legality, validity
     and enforceability of the remainder of this Deed in that jurisdiction shall
     not be affected, and the legality, validity and enforceability of the whole
     of this Deed in any other jurisdiction shall not be affected.

20.  NOTICES

20.1 Any notice (which term shall in this clause include any other
     communication) required to be given under this Deed or in connection with
     the matters contemplated by it shall, except where otherwise specifically
     provided, be in writing in the English language.

20.2 Any such notice shall be addressed as provided in sub-clause 20.3 and may
     be:

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                                       10

     (A)  personally delivered, in which case it shall be deemed to have been
          given upon delivery at the relevant address; or

     (B)  if within Hong Kong, sent by pre-paid post, in which case it shall be
          deemed to have been given two Business Days after the date of posting;
          or

     (C)  if from or to any place outside Hong Kong, sent by pre-paid airmail,
          in which case it shall be deemed to have been given seven Business
          Days after the date of posting; or

     (D)  sent by facsimile, in which case it shall be deemed to have been given
          when despatched, subject to confirmation of uninterrupted transmission
          by a transmission report provided that any notice despatched by
          facsimile after 5:00 p.m. on any day shall be deemed to have been
          received at 9:00 a.m. on the next Business Day.

20.3 The addresses and other details of the Parties referred to in sub-clause
     20.2 are, subject to sub-clause 20.4:

     If to the Subscriber, the Alternate Subscriber or China Netcom, to:

     China Netcom Group Corporation (BVI) Limited

     59/F, Bank of China Tower,
     1 Garden Road,
     Hong Kong

     Facsimile:  +852 3108 3823

     Attention:  Wang Chuanbao

     If to the Company, to:

     PCCW Limited

     39th Floor, PCCW Tower,
     TaiKoo Place,
     979 King's Road,
     Quarry Bay,
     Hong Kong

     Facsimile:  +852 2962 5725

     Attention:  The Company Secretary

20.4 Any Party may notify the other Parties of any change to the address or any
     of the other details specified in sub-clause 20.3, provided that such
     notification shall only be effective on the date specified in such notice
     or five Business Days after the notice is given, whichever is later.

<PAGE>
                                       11

IN WITNESS WHEREOF this Deed has been duly executed as a deed by the parties on
the date first above written.

EXECUTED as a Deed by                   )
CHINA NETCOM GROUP CORPORATION          )
(BVI) LIMITED                           )
was affixed in the presence of:-        )

EXECUTED as a Deed by                   )
CHINA NETCOM CORPORATION                )
(BVI) LIMITED                           )
in the presence of:-                    )

EXECUTED as a Deed by                   )
CHINA NETWORK COMMUNICATIONS            )
GROUP CORPORATION                       )
in the presence of:-                    )

The Common Seal of                      )
PCCW LIMITED                            )
was affixed in the presence of:-        )

HK050320155Exhibit 4(ww)

                    Reach Network Services
                    Agreement

                    Dated 16 April 2005

                    Reach Ltd. ("Reach Parent")
                    Reach Global Services Limited. ("Reach")
                    Reach Networks Hong Kong Limited. ("RNHK")
                    Telstra Corporation Limited (ABN 33 051 775 556)
                    ("Telstra")
                    Hong Kong CSL Limited ("CSL")
                    PCCW Limited ("PCCW")
                    PCCW Communications (Singapore) Pte Ltd ("PCCW
                    Capacity Holder")
                    PCCW-HKT Telephone Limited ("PCCW-HKT")

                    Mallesons Stephen Jaques
                    Level 10
                    Central Park
                    152 St George's Terrace
                    Perth   WA   6000
                    Australia
                    T +61 8 9269 7000
                    F +61 8 9269 7999
                    DX 91049 Perth
                    www.mallesons.com

<PAGE>

Reach Network Services Agreement
Contents

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1      Scope                                                      4
--------------------------------------------------------------------------------
2      Effective Date                                             4

2.1    Effective Date                                             4
2.2    Effect on other agreements                                 4
2.3    Transitional provisions                                    4
2.4    Good faith negotiations                                    5
--------------------------------------------------------------------------------
3      Appointment of Reach                                       6

3.1    Appointment                                                6
3.2    Non-exclusive                                              6
3.3    No volume commitment                                       6
3.4    Parent's Group                                             6
--------------------------------------------------------------------------------
4      Provision of Outsourcing Services to Parents'
       Groups                                                     7

4.1    Provision of Outsourcing Services                          7
4.2    Provision of Telecommunications
       Services                                                   7
4.3    Right to deal with Parent's
       Capacity                                                   7
4.4    Provisioning, Operations and
       Maintenance for
       Telecommunications Services                                8
4.5    Prohibited Traffic for
       Telecommunications Services                                8
4.6    End Customers                                              9
4.7    Limited obligation                                         9
4.8    Licences                                                   9
4.9    Early termination fees                                     9
--------------------------------------------------------------------------------
5      Variation of Telecommunications Services                  10

5.1    Additional Telecommunications
       Services                                                  10
5.2    Variation of a Telecommunications
       Service                                                   10
5.3    Withdrawal of a
       Telecommunications Service                                10
5.4    Service Manuals                                           10
--------------------------------------------------------------------------------
6      Procedures                                                11
--------------------------------------------------------------------------------
7      Voice Services                                            11

7.1    Third party Voice Services                                11
7.2    Parent Voice Services                                     11
--------------------------------------------------------------------------------
8      Outsourcing Fee                                           14

8.1    Quarterly Outsourcing Fee                                 14
8.2    Determination of Quarterly
       Outsourcing Fee                                           14
--------------------------------------------------------------------------------
9      Estimated Monthly Fee and Payment                         14

9.1    Payment of monthly amount                                 14
9.2    Quarterly adjustment                                      15
9.3    Payment of Quarterly Adjustment                           15

                                                                               i

<PAGE>

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10     Invoices                                                  15

10.1   Invoicing Procedure                                       15
10.2   Right to require separate invoices                        15
10.3   Payment procedure                                         16
10.4   Other Currencies                                          16
10.5   Parent Group Charges                                      16
10.6   Disputed Amount                                           16
--------------------------------------------------------------------------------
11     Audit Procedure                                           17

11.1   Audit right                                               17
11.2   Costs and Responsibility                                  17
11.3   No unreasonable interference                              17
--------------------------------------------------------------------------------
12     Reach Capex Commitments                                   17

12.1   Parent Funded Non Cable Capex                             17
12.2   Reach not to incur other Capex                            18
12.3   De minimus                                                18
12.4   No change to terms applying to
       Funded Capex                                              18
--------------------------------------------------------------------------------
13     Additional Capacity                                       18

13.1   No obligation                                             18
13.2   Acquired Capacity                                         19
13.3   Provisions applying where a
       Parent gives notice                                       19
13.4   Management of Acquired Capacity                           20
13.5   Withdrawal of Parent Acquired
       Capacity                                                  20
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14     Reach Recommendations                                     21
--------------------------------------------------------------------------------
15     Telecommunications Service Development                    21

15.1   New Services                                              21
15.2   Parent Funded Development                                 21
15.3   No unfunded development                                   21
15.4   De minimus                                                21
15.5   Compensation                                              21
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16     Restoration                                               21

16.1   External Restoration                                      21
16.2   Internal Restoration                                      21
16.3   Reports                                                   21
16.4   Obligation to minimise faults                             21
--------------------------------------------------------------------------------
17     Committed Third Party Data Services                       21

17.1   No new Committed Third Party Data
       Contracts                                                 21
17.2   Existing Committed Third Party
       Data Contracts                                            21
17.3   Not used                                                  21
17.4   Transition of Committed Third
       Party Data Services                                       21
--------------------------------------------------------------------------------
18     Staff and other resources                                 21

18.1   Provision of staff                                        21
18.2   Responsibility for staff                                  21
--------------------------------------------------------------------------------
19     Reach Systems and Equipment                               21

19.1   Reach Systems                                             21

                                                                              ii

<PAGE>

19.2   Maintenance and Repair                                    21
19.3   Reach Equipment                                           21
19.4   Title                                                     21
19.5   Maintenance and Repair                                    21
19.6   Parent's Systems and Equipment                            21
--------------------------------------------------------------------------------
20     Trespass                                                  21
--------------------------------------------------------------------------------
21     Reports                                                   21
--------------------------------------------------------------------------------
22     No set off                                                21

22.1   Parent not entitled to set off
       amounts                                                   21
22.2   Set off under the AJC Indemnity
       Agreement                                                 21
--------------------------------------------------------------------------------
23     Minimal Cost                                              21
--------------------------------------------------------------------------------
24     Review of Performance Requirement                         21
--------------------------------------------------------------------------------
25     Forecasts                                                 21
--------------------------------------------------------------------------------
26     Disaster recovery                                         21
--------------------------------------------------------------------------------
27     Insurance                                                 21

27.1   Maintain insurance policies                               21
27.2   Compliance                                                21
27.3   Evidence                                                  21
--------------------------------------------------------------------------------
28     Taxes                                                     21
--------------------------------------------------------------------------------
29     OSF                                                       21

29.1   Establishment of OSF                                      21
29.2   Workings of OSF                                           21
29.3   Rules of OSF                                              21
--------------------------------------------------------------------------------
30     Confidentiality                                           21

30.1   Privacy Obligations                                       21
30.2   Fraud and Bad Debt Prevention                             21
30.3   Disclosure or Use of Confidential
       Information                                               21
30.4   Permitted Disclosure                                      21
30.5   Procedures to protect
       Confidential Information                                  21
30.6   Conditions on consent to
       disclosures of Confidential
       Information                                               21
30.7   Third party Confidential
       Information                                               21
30.8   Announcements                                             21
--------------------------------------------------------------------------------
31     Regulatory Event                                          21

31.1   Right to request good faith
       negotiations                                              21
31.2   Right to suspend or terminate                             21
31.3   Failure to agree                                          21
--------------------------------------------------------------------------------
32     Intellectual Property                                     21

32.1   Rights                                                    21

                                                                             iii

<PAGE>

32.2   Infringement                                              21
32.3   Protection of rights                                      21
32.4   Rights on infringement                                    21
32.5   Parties to discuss                                        21
32.6   Limit of rights                                           21
32.7   No right to use other name and
       logo                                                      21
32.8   No licence                                                21
--------------------------------------------------------------------------------
33     Force Majeure                                             21

33.1   Suspension of obligations                                 21
33.2   Force Majeure continuing for more
       than 10 Business Days                                     21
33.3   Strikes                                                   21
--------------------------------------------------------------------------------
34     Reach default                                             21

34.1   Reach Default Notice                                      21
34.2   Termination                                               21
34.3   Damages                                                   21
--------------------------------------------------------------------------------
35     Not used                                                  21
--------------------------------------------------------------------------------
36     Suspension                                                21
--------------------------------------------------------------------------------
37     Parent Payment Default                                    21

37.1   Reach to advise others                                    21
37.2   Resolution of Payment Dispute                             21
37.3   Valuation of IRUs and MIU points                          21
--------------------------------------------------------------------------------
38     Dispute Resolution                                        21

38.1   Manner in which disputes to be
       resolved                                                  21
38.2   Notice of Dispute                                         21
38.3   Compulsory final and binding
       Arbitration                                               21
38.4   Appointment of arbitration
       tribunal                                                  21
38.5   Conduct of arbitration                                    21
38.6   Arbitrator's award                                        21
38.7   Election rights                                           21
--------------------------------------------------------------------------------
39     Miscellaneous                                             21

39.1   Representations and Warranties                            21
39.2   Severance                                                 21
39.3   Governing law and jurisdiction                            21
39.4   Entire agreement                                          21
39.5   Variation                                                 21
39.6   Assignment                                                21
39.7   Waiver                                                    21
39.8   Relationship of parties                                   21
39.9   Relationships with Third Persons                          21
39.10  Approvals and Consents                                    21
39.11  Notices                                                   21
39.12  Counterparts                                              21
--------------------------------------------------------------------------------
40     Structure and interpretation                              21

40.1   Structure                                                 21
40.2   Annexures E to G                                          21

                                                                              iv

<PAGE>

40.3   Annexure A ("Definitions")                                21
40.4   Annexure J                                                21
40.5   Service Schedules                                         21
40.6   Performance Requirements and Cost
       Information Schedule                                      21
40.7   Inconsistency                                             21
40.8   Interpretation                                            21
40.9   Headings                                                  21
--------------------------------------------------------------------------------

Annexure A (Definitions)                                         21

                                                                               v

<PAGE>

Reach Network Services Agreement

Details

Interpretation - definitions are at the end of the General terms

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

Parties         Reach Parent, Reach, RNHK, Telstra, CSL, PCCW, PCCW
                Capacity Holder and PCCW-HKT
--------------------------------------------------------------------------------

Reach Parent    Name           Reach Ltd.

                Place of       Bermuda
                incorporation

                Address        Clarendon House, 2 Church Street,
                               Hamilton HM11, Bermuda

                Fax            +1-441-292-4720

                Attention      Company Secretary

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

Reach           Name           Reach Global Services Limited.

                Place of       Bermuda
                incorporation

                Address        20th Floor, Telecom House, 3
                               Gloucester Road, Wanchai, Hong Kong

                Fax            +852 2824 0518

                Attention      The Company Secretary
--------------------------------------------------------------------------------

RNHK            Name           Reach Networks Hong Kong Limited.

                Place of       Hong Kong Special Administrative
                incorporation  Region, Peoples' Republic of China

                Address        20th Floor, Telecom House, 3
                               Gloucester Road, Wanchai, Hong Kong

                Fax            +852 2824 0518

                Attention      Company Secretary
--------------------------------------------------------------------------------

Telstra or      Name           Telstra Corporation Limited
Telstra
Capacity Holder

                ABN            33 051 775 556

                                                                               1

<PAGE>

                Place of       Commonwealth of Australia
                incorporation

                Address        242 Exhibition Street, Melbourne Vic
                               3000, Australia

                Telephone      +61 3 9634 6400

                Fax            +61 3 9632 3215

                Attention      The Company Secretary
--------------------------------------------------------------------------------

CSL             Name           Hong Kong CSL Limited

                Place of       Hong Kong Special Administrative
                incorporation  Region, Peoples' Republic of China

                Address        Unit 501-8, 5th Floor, Cyberport 3,
                               Cyberport Road, Hong Kong

                Fax            +852 2962 6111

                Attention      The Company Secretary
--------------------------------------------------------------------------------

PCCW            Name           PCCW Limited

                Place of       Hong Kong Special Administrative
                incorporation  Region, Peoples' Republic of China

                Address        39th Floor, PCCW Tower, TaiKoo
                               Place, 979 King's Road, Quarry Bay,
                               Hong Kong

                Fax            +852-2962-5725

                Attention      The Company Secretary
--------------------------------------------------------------------------------

PCCW Capacity   Name           PCCW Communications (Singapore) Pte
Holder                         Limited

                Place of       Republic of Singapore
                incorporation

                Address        152 Beach Road #26-06 Gateway East
                               Singapore 189721

                Fax            +65 62 30 8777

                Attention      Lim Beng Jin
--------------------------------------------------------------------------------

PCCW-HKT        Name           PCCW-HKT Telephone Limited

                Place of       Hong Kong Special Administrative
                incorporation  Region,

                                                                               2

<PAGE>

                               Peoples' Republic of China

                Address        39th Floor, PCCW Tower, TaiKoo
                               Place, 979 King's Road, Quarry Bay,
                               Hong Kong

                Fax            +852-2962-5725

                Attention      The Company Secretary
--------------------------------------------------------------------------------

Recitals        A      RNHK and Reach currently provide the ISA
                       Services to PCCW-HKT, Telstra and CSL and
                       certain of their Related Body Corporates
                       under the ISAs.

                B      Reach and RNHK, PCCW,  Telstra and CSL have
                       agreed to change the business model on which
                       certain of the services are currently
                       provided from that provided for by the ISAs
                       to the outsourcing model provided by this
                       agreement.

                C      Reach has agreed to provide each Parent's
                       Group with the Outsourcing Services
                       utilising for that purpose the Parent's
                       Capacity on the terms and conditions of this
                       agreement.
--------------------------------------------------------------------------------

Date of         See Signing page
agreement

                                                                               3

<PAGE>

Reach Network Services Agreement

General terms

--------------------------------------------------------------------------------
1    Scope

     This agreement sets out the terms and conditions on which Reach will
     provide the Outsourcing Services to each Parent's Group.

--------------------------------------------------------------------------------
2    Effective Date

2.1  Effective Date

     This agreement takes effect on and from the Effective Date as if it
     commenced on the Commencement Date and continues for the remainder of the
     Term unless it is terminated earlier in accordance with this agreement.

2.2  Effect on other agreements

     (a)  The ISAs are terminated with effect from the Commencement Date.

     (b)  Termination of the agreements under clause 2.2(a) is without
          prejudice to any rights, liabilities or obligations of the parties
          which have accrued up to the Commencement Date and does not
          extinguish or otherwise affect the provisions of the agreements which
          by their nature survive termination.

2.3  Transitional provisions

     (a)  From the Commencement Date, each ISA Service will be deemed to be a
          Telecommunications Service provided by Reach to the member of the
          relevant Parent's Group who acquired that ISA Service prior to the
          Commencement Date on the terms and conditions of this agreement (ISA
          Recipient).

     (b)  For the avoidance of doubt, the parties acknowledge that, from the
          Commencement Date, with respect to an ISA Service which becomes a
          Telecommunications Service:

          (i)  the charges payable under the ISA will cease to apply to the
               provision of the Telecommunications Service as from the
               Commencement Date;

          (ii) the ISA Recipient will remain liable to pay charges for ISA
               Services supplied by the Reach Group prior to the Commencement
               Date in accordance with the relevant ISA;

          (iii) no rebates will apply in respect of that Telecommunications
               Service;

          (iv) save as set out in clause 4.9, no cancellation charges will
               apply if a Telecommunications Service is terminated prior to

                                                                               4

<PAGE>

               the expiration of any minimum term commitment which applied to
               the relevant ISA Service under the relevant ISA. Any such
               minimum term commitment will be deemed to be the minimum term
               for that Telecommunications Service for the purpose of clause
               4.9.

     (c)  Any invoiced charges for an ISA Service to the extent the service is
          provided after 1 March 2005 will be cancelled and any payment
          received from the Parent's Group in respect of such invoiced amounts
          will be applied against the Estimated Monthly Fee which is payable by
          the Parent under clause 9 ("Estimated Monthly Fee and Payment").

     (d)  By 29 April 2005, each Parent will pay to Reach the Estimated Monthly
          Fees which would have fallen due for payment at the Effective Date if
          this agreement had been in effect at the Commencement Date after
          allowing for the application of any amount as provided for in clause
          2.3(c) notwithstanding that invoices for the months of March and
          April 2005 have not been issued.

     (e)  Each Parent will pay to Reach the Estimated Monthly Fees for May 2005
          which is due on 1 May 2005 on that date notwithstanding that an
          invoice for the relevant amount has not issued in accordance with the
          requirements of Annexure E ("Billing and Settlement").

     (f)  Reach must provide each Parent with invoices for the Estimated
          Monthly Fees for March, April and May 2005 within 5 Business Days of
          the Effective Date.

2.4  Good faith negotiations

     (a)  The parties agree that amendments may be required to the Service
          Schedules and Performance Requirements and Cost Information Schedules
          for Telecommunications Services and the Service Schedules for Other
          Outsourcing Services following the Effective Date. Accordingly, the
          parties agree to enter into good faith negotiations as to whether any
          such amendments are required for a period of 20 Business Days after
          the Effective Date.

     (b)  For the avoidance of doubt, the parties agree that this agreement
          including the schedules referred to in clause 2.4(a) are of full
          legal effect and that nothing in this clause 2.4(a) or the failure of
          the parties to reach agreement on any amendments to the schedules
          referred to in that clause will affect the legal effectiveness of
          this agreement or may be relied on by a party as an excuse for any
          failure to perform its obligations under this agreement.

     (c)  The parties acknowledge that as a general principle, Reach must
          ensure that the Service Schedules for each Parent contain equivalent
          service levels.

                                                                               5

<PAGE>

--------------------------------------------------------------------------------
3    Appointment of Reach

3.1  Appointment

     Each Parent appoints Reach to provide the Outsourcing Services to the
     Parent's Group for the Term and Reach accepts such appointment on the
     terms of this agreement.

3.2  Non-exclusive

     Reach's appointment is non-exclusive and any member of a Parent's Group
     may:

     (a)  appoint another person to provide services which are in the nature of
          the Outsourcing Services; or

     (b)  acquire services which are in the nature of the Telecommunications
          Services from another person,

     and subject to this agreement, a Parent may vary or terminate the
     Outsourcing Services provided to the Parent's Group in accordance with
     this agreement.

3.3  No volume commitment

     The parties each acknowledge that neither Parent's Group has given any
     representation or undertaking as to the level of the Outsourcing Services
     it will acquire from Reach.

3.4  Parent's Group

     (a)  The Outsourcing Services are to be provided by Reach in accordance
          with this agreement to each Parent and any Related Body Corporate of
          the Parent whom the Parent notifies Reach is authorised to order
          Telecommunications Services in accordance with this agreement (each a
          Group).

     (b)  Telstra notifies Reach that CSL is authorised to order
          Telecommunications Services.

     (c)  PCCW notifies Reach that PCCW-HKT is authorised to order
          Telecommunications Services.

     (d)  Where a member of a Parent's Group ceases to be a Related Body
          Corporate of the Parent, it ceases to be entitled to order or receive
          any further Outsourcing Services under this agreement.

     (e)  Notwithstanding that Outsourcing Services may be ordered or provided
          to another member of the Parent's Group, the Parent will remain
          liable to Reach for compliance with the provisions of this agreement
          as if the relevant service were ordered and provided to that Parent.

                                                                               6

<PAGE>

--------------------------------------------------------------------------------
4    Provision of Outsourcing Services to Parents' Groups

4.1  Provision of Outsourcing Services

     Reach must provide the Outsourcing Services to each Parent's Group in
     accordance with the terms of this agreement and in the case of the
     Telecommunications Services in accordance with this agreement and the
     Service Manuals.

4.2  Provision of Telecommunications Services

     For the purpose of providing the Telecommunications Services to each
     Parent's Group, Reach will utilise:

     (a)  that Parent's Capacity except as otherwise provided by this
          agreement;

     (b)  where the Telecommunications Service uses the Parent's Allocated
          Capacity on a cable system, any Reach Landing Segment Capacity
          required to enable the delivery of the Telecommunications Service to
          the Landing Station;

     (c)  any backhaul Capacity acquired by a member of the Reach Group to
          enable the delivery of the Telecommunications Service from the
          Landing Station to the POI;

     (d)  where the Telecommunications Service includes a local tail, a local
          tail acquired by a member of the Reach Group to enable the delivery
          of the Telecommunications Service from the POI to the End Customer;

     (e)  Reach Systems and Reach Equipment;

     (f)  the Parent's Systems and Equipment;

     (g)  Third Party Network Interconnect Services; and

     (h)  services acquired by the Reach Group under the DAAs.

4.3  Right to deal with Parent's Capacity

     (a)  Each Parent and the PCCW Capacity Holder grants to Reach for the Term
          the right to deal with the Parent's Capacity and the Parent's Systems
          and Equipment for the purpose of providing the Telecommunications and
          Other Outsourcing Services to that Parent's Group under this
          agreement. Subject to clause 16 ("Restoration") and save as otherwise
          agreed between the Parents, Reach may only use a Parent's Capacity to
          provide the Telecommunications Services to that Parent's Group.
          However, Reach is not required to use any particular cable system
          route in providing the Telecommunications Services to a Parent's
          Group unless requested to do so at the time of ordering of the
          service and it is reasonably practical to do so.

                                                                               7

<PAGE>

     (b)  Subject to clause 4.3(d), each Parent and the PCCW Capacity Holder
          grants to Reach for the Term, the right to deal with the Parent's
          Capacity for the purpose of providing:

          (i)   voice services to the Parents' Groups and third party customers;

          (ii)  satellite services to third party customers and satellite
                services which are not Telecommunications Services to the
                Groups; and

          (iii) Committed Third Party Data Services to Committed Third Party
                Customers.

     (c)  Save as set out in this agreement, no charge is payable by Reach to
          the Parent or the Capacity Holder for the use of the Parent's
          Capacity.

     (d)  Without the agreement of the Parents, Reach must not increase the
          amount of Capacity used on any of the cable systems for the purpose
          of providing the services referred to in clause 4.3(b) beyond that
          which is reserved for the provision of such services as at the
          Commencement Date and will divide that use between each Parent's
          Capacity on a cable system in equal shares.

4.4  Provisioning, Operations and Maintenance for Telecommunications Services

     The parties agree that, except where expressed otherwise in this agreement
     or otherwise agreed in writing, each party is responsible for the
     operation and maintenance of Network facilities on its side of a POI.

4.5  Prohibited Traffic for Telecommunications Services

     (a)  A Parent's Group must not deliver Prohibited Traffic to Reach's
          Network.

     (b)  A Parent's Group must make reasonable endeavours not to deliver
          traffic to Reach's Network that is:

          (i)   illegal;

          (ii)  immoral or fraudulent (in the reasonable opinion of Reach); or

          (iii) declared by a competent government authority to be traffic
                prohibited by that authority,

          (collectively Unauthorised Traffic).

     (c)  Reach may take such action as is reasonably necessary to prevent
          Prohibited Traffic and Unauthorised Traffic from entering its
          Network. Reach must give as much notice as is practical to the
          relevant Parent of any such action. Such action may include, but is
          not limited to, giving instructions to the Parent regarding how to
          prevent Prohibited Traffic and Unauthorised Traffic from entering
          Reach's Network and suspending the supply of the affected
          Telecommunications Service under clause 36.2 ("Suspension") if such
          instructions are not implemented..

                                                                               8

<PAGE>

4.6  End Customers

     The parties acknowledge that unless otherwise agreed between Reach and a
     Parent, each Parent's Group will be responsible for billing its own
     customers for the services it provides to them.

4.7  Limited obligation

     The parties acknowledge that Reach is not obliged to provide:

     (a)  Telecommunications Services to a Parent's Group where the Parent's
          Capacity does not reasonably allow for the provision of that service
          (treating for this purpose any Capacity under any short term lease
          acquired for the Group as if it were part of the Parent's Capacity).

     (b)  Outsourcing Services to a Parent's Group if the provision of those
          services would require Reach to acquire additional equipment unless
          the funds for that equipment are provided for in the AOP or the
          Parent concerned has agreed to fund the acquisition costs for that
          equipment and any incremental operational and maintenance charges in
          relation to that equipment or to otherwise provide the equipment as
          part of the Parent's System and Equipment.

4.8  Licences

     Reach warrants that the Reach Group currently has and save as otherwise
     agreed with the Parents, agrees to maintain in full force and effect
     during the Term, all necessary consents, permits, licenses and other
     approvals from all governmental and other authorities which are required
     for the supply by it of the Outsourcing Services as contemplated by this
     agreement.

4.9  Early termination fees

     (a)  Save as set out in clause 4.9 (b), no early termination fee will
          apply if a Telecommunications Service is terminated prior to the
          expiration of the minimum term for that service.

     (b)  Where a Telecommunications Service which is a data service includes
          the provision of a local tail or customer premises equipment, if the
          service is terminated prior to the expiration of the minimum term for
          that service, Reach may incur an early termination fee to the person
          who provided the tail or customer premises equipment. Reach will
          recover any such early termination fee to the extent that it relates
          to the period prior to the expiration of the minimum term as a part
          of the Parent Specific Charges payable by the Parent whose Group was
          receiving the service.

                                                                               9

<PAGE>

--------------------------------------------------------------------------------
5    Variation of Telecommunications Services

5.1  Additional Telecommunications Services

     (a)  From time to time, Reach may agree with a Parent to provide a new
          telecommunications service to that Parent's Group in which case this
          agreement will be amended to incorporate the new service by:

          (i)  the addition of the new service into the list in Annexure J
               ("List of Telecommunications Services"); and

          (ii) the addition of a new Service Schedule for that
               telecommunications service.

          Reach must act reasonably in considering any request to provide a new
          telecommunications service and in reaching agreement with a Parent on
          the terms and conditions which will apply to that new service.

     (b)  Where Reach agrees to provide a new telecommunications service to a
          Parent's Group, Reach must:

          (i)  provide a copy of the new Service Schedule to each Parent;

          (ii) notify the Parents of the estimated incremental costs associated
               with providing that new telecommunications service.

     (c)  Unless otherwise agreed between the Parents and Reach, the
          incremental costs associated with providing that new
          telecommunications service will be recovered from the Parent's Group
          utilising the new telecommunications service as part of the
          Outsourcing Fee for that Group until the other Parent's Group elects
          to use the service, and thereafter those costs will be recovered as
          part of the Recovery Fee.

5.2  Variation of a Telecommunications Service

     Reach and a Parent may agree to vary a Telecommunications Service in which
     case the parties will vary the Service Schedule for that
     Telecommunications Service for that Parent's Group with effect from the
     date that the variation to the Telecommunications Service occurs.

5.3  Withdrawal of a Telecommunications Service

     Reach and a Parent may agree to Reach withdrawing a Telecommunications
     Service in which case the parties will delete the Service Schedule for
     that Telecommunications Service for that Parent's Group with effect from
     the date that the withdrawal to the Telecommunications Service occurs.

5.4  Service Manuals

     (a)  The parties must use reasonable endeavours to comply with the Service
          Manuals.

                                                                              10

<PAGE>

     (b)  Reach may amend a Service Manual on 5 Business Days' notice where it
          reasonably believes that the amendment has no or only a minor effect
          on the relevant Parent's Group. All other changes to Service Manuals
          must be agreed between Reach and the relevant Parent.

     (c)  If the relevant Parent objects to a change to a Service Manual
          proposed by Reach the resulting dispute may be dealt with in
          accordance with clause 38 ("Dispute Resolution") in which case the
          change will not come into effect unless the dispute is resolved in
          favour of that change in accordance with clause 38 ("Dispute
          Resolution").

--------------------------------------------------------------------------------
6    Procedures

     The parties will comply with:

     (a)  the Costing Information Procedures;

     (b)  the Forecasting, Ordering and Provisioning Procedures; and

     (c)  the Operations and Maintenance Procedures,

     relating to the provision of the Telecommunications Services.

--------------------------------------------------------------------------------
7    Voice Services

7.1  Third party Voice Services

     The parties acknowledge that Reach will continue to provide voice services
     to third party customers on commercial terms and this agreement will only
     apply to the Voice Services provided by Reach to each Group.

7.2  Parent Voice Services

     (a)  Reach will provide Voice Services to each Parent's Group based on the
          following arrangements:

          (i)   net settlement arrangements (including traditional transit and
                one-way accounting rate arrangements);

          (ii)  send or pay arrangements;

          (together, Bilateral Arrangements),

          (iii) refile arrangements; and

          (iv)  other arrangements agreed between Reach and the Parents from
                time to time.

     (b)  The following terms will apply to Voice Services provided on a net
          settlement basis:

                                                                              11

<PAGE>

          (i)  the accounting and other settlement rates which apply under the
               relevant bilateral agreement between Reach and an international
               Correspondent Carrier for such Voice Services will also apply to
               the Voice Services delivered to Reach and taken from Reach by
               the Parent's Group;

          (ii) the Parent's Group will not pay Reach for any Voice Service
               which the Parent delivers to Reach but will settle based on a
               net payment (determined on a net aggregate level for combined
               inbound and outbound traffic) which will be taken into account
               in determining the Voice Fee;

         (iii) Reach will recover from the Parent as a cost which is
               attributable to that Parent any charges invoiced to Reach under
               the DAA entered into with a member of the Parent's Group for the
               termination of Voice calls save to the extent that an election
               is made under that DAA not to require Reach to pay those
               charges.

     (c)  The following terms will apply to Voice Services provided under a
          send or pay arrangement:

          (i)  Reach will enter into send or pay agreements with international
               Correspondent Carriers in respect of traffic from a Parent's
               Group in accordance with the Voice Management Principles, and,
               in respect of the Major Routes, after consulting with the Parent
               and Reach will agree with the Parent, either particularly or in
               the form of agreed parameters, the:

               (A)  originations and destinations;

               (B)  term;

               (C)  the Voice Services utilising the arrangement;

               (D)  rates; and

               (E)  volumes of minutes,

               to be covered in respect of the relevant send or pay agreement.

          (ii) In the event of a forecast shortfall of the volume of minutes
               from a Parent or a member of its Group subject to a send or pay
               arrangement, Reach must notify that Parent or relevant member of
               the number of minutes of the relevant traffic which has been
               sent and the number of minutes required to make up the forecast
               shortfall against the committed amount, and Reach will work with
               the Parent or relevant member to fill such shortfall by sourcing
               and sending third party traffic.

         (iii) In the event of an actual shortfall in the contracted volume
               which is filled by minutes from third party traffic, if the
               third party traffic sent via the send or pay arrangement results
               in:

                                                                              12

<PAGE>

               (A)  higher net revenue than would have been reasonably expected
                    to have been generated by Reach's third party wholesale
                    voice business, that net revenue gain will be credited to
                    the Parent as part of the Voice Fee payable by that Parent;
                    and

               (B)  lower net revenue than would have been reasonably expected
                    to have been generated by Reach's third party wholesale
                    voice business, that net revenue loss will be included as
                    part of the Voice Fee payable by that Parent.

          (iv) In the event of an actual shortfall of the volume of minutes
               sent by a Parent or the member of that Parent's Group at the end
               of the relevant send or pay arrangement, an amount equal to the
               number of minutes making up the shortfall in traffic multiplied
               by the send or pay agreed rate will be recoverable from the
               relevant Parent as part of the Voice Fee.

          (v)  Any net revenue gain from a send or pay arrangement, other than
               any gain arising under the circumstances contemplated by clause
               7.2(c)(iii)(A) will be attributed to the Parent for the purpose
               of determining the Voice Fee payable by that Parent.

          (vi) Reach will recover from the Parent as a cost which is
               attributable to that Parent any charges invoiced to Reach under
               the DAA entered into with a member of the Parent's Group for the
               termination of Voice calls save to the extent that an election
               is made under that DAA not to require Reach to pay those
               charges.

     (d)  The following terms will apply to Voice Services provided under a
          refile arrangement:

          (i)  Reach will enter into refile arrangements with international
               Correspondent Carriers in accordance with the Voice Management
               Principles;

          (ii) the rates which apply to a Parent's traffic will be the same
               rates as charged to Reach by the international Correspondent
               Carrier and will be recoverable from the Parent as part of the
               Voice Fee;

     (e)  Reach will work with each Parent (focusing on the Major Routes) to
          determine whether voice traffic is to be sent via a Bilateral
          Arrangement or a refile arrangement.

     (f)  For the avoidance of doubt the parties acknowledge that a member of a
          Parent's Group may enter into new bilateral or refile agreements with
          other carriers.

     (g)  Save in accordance with the Voice Management Principles, Reach will
          not vary the bilateral agreements with international
          Correspondent Carriers or agree to any change in the rate payable
          under such agreements without the approval of the Parent.

                                                                              13

<PAGE>

     (h)  Reach notifies the Parents that it will not use any means of
          terminating traffic in any international destination which, in
          Reach's reasonable opinion, may be in breach of any applicable law or
          regulation.

     (i)  The Parents agree to provide Reach with forecasts for Voice Services
          in accordance with paragraph 1.2(a)(ii) of Annexure F, and to assist
          Reach with its reporting of actual voice traffic in categories
          contemplated by that paragraph.

     (j)  The terms applicable to any other arrangements Reach enters into with
          the agreement of Reach and the applicable Parent from time to time
          pursuant to clause 7.2(a)(iv) shall be at Reach's net cost or as
          otherwise agreed at the time.

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8    Outsourcing Fee

8.1  Quarterly Outsourcing Fee

     For so long as a Default Notice has not been issued, Reach will charge
     each Parent on a Quarterly basis an outsourcing fee for the Services
     provided to the Parent's Group under this agreement for that Quarter
     (Quarterly Outsourcing Fee).

8.2  Determination of Quarterly Outsourcing Fee

     The Quarterly Outsourcing Fee will be determined in accordance with
     Annexure C ("Quarterly Outsourcing Fee").

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9    Estimated Monthly Fee and Payment

9.1  Payment of monthly amount

     (a)  For so long as a Default Notice has not been issued, each Parent must
          pay Reach in accordance with Annexure E ("Billing and Settlement") on
          account of the Quarterly Outsourcing Fee payable by that Parent's
          Group, the amount set out in the applicable AOP as the amount payable
          by that Parent for that month (Estimated Monthly Fee).

     (b)  Where the applicable AOP has not been agreed by the start of a Year,
          the Estimated Monthly Fee which will apply to a Parent until the AOP
          has been agreed will be 92.5% of the Estimated Monthly Fee for that
          Parent for the equivalent month in the preceding Year or in the case
          there is no Estimated Monthly Fee for that month, 92.5% of the
          monthly average of the Estimated Monthly Fees payable by that Parent
          for the preceding Year.

                                                                              14

<PAGE>

9.2  Quarterly adjustment

     An adjustment (Quarterly Adjustment) will be made in accordance with
     Annexure E ("Billing and Settlement") after the end of each Quarter to
     reflect any difference between:

     (a)  the aggregate of the Estimated Monthly Fees for the Parent's Group
          for the preceding Quarter; and

     (b)  the Quarterly Outsourcing Fee for the Parent's Group for that
          Quarter.

     The parties acknowledge that certain of the costs and revenues which are
     to be taken into account in determining the Quarterly Adjustment may not
     be finally determined at the time the Quarterly Adjustment is made and
     that reasonable estimates of such unquantified amounts may be used for the
     purpose of determining the Quarterly Adjustment. Once such costs or
     revenues are finally determined an adjustment will be made and included in
     the Quarterly Adjustment for the Quarter in which they are finally
     determined.

9.3  Payment of Quarterly Adjustment

     The Quarterly Adjustment will be made as follows:

     (a)  if the aggregate of the Estimated Monthly Fees for the Parent for the
          preceding Quarter exceeds the Quarterly Outsourcing Fee for the
          Parent for that Quarter, the Quarterly Adjustment will be applied
          against the Estimated Monthly Fees for subsequent months;

     (b)  if the Quarterly Outsourcing Fee for the Parent for that Quarter
          exceeds the aggregate of the Estimated Monthly Fees for the Parent
          for the Quarter, the Parent will pay Reach the Quarterly Adjustment
          in accordance with Annexure E ("Billing and Settlement"); and

     (c)  if this agreement is terminated then any outstanding portion of the
          Quarterly Adjustment due to a Parent under clause 9.3(a) will be paid
          to the Parent on demand.

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10   Invoices

10.1 Invoicing Procedure

     Reach will invoice each Parent in accordance with the procedure set out in
     Annexure E ("Billing and Settlement").

10.2 Right to require separate invoices

     (a)  If a Parent notifies Reach that it requires a part of the Outsourcing
          Fee to be invoiced to another member or members of that Parent's
          Group and specifies the proportion of the Outsourcing Fee which is to
          be invoiced to that other member or members, Reach will issue any
          invoice for the Estimated Monthly Amount and the Quarterly Adjustment
          in accordance with that direction.

                                                                              15

<PAGE>

     (b)  If a Parent notifies Reach that it requires specific Voice Services
          to be invoiced to another member or members of that Parent's Group,
          Reach will issue any invoice for the specified Voice Services in
          accordance with that direction and any payment made in relation to
          that invoice will be treated as having been made by the Parent on
          account of the Estimated Monthly Fees for the Parent's Group for the
          Quarter in which the payment is received.

     (c)  A Parent may by further notice to Reach amend any notice given under
          clauses 10.2(a) or (b).

     (d)  Unless otherwise agreed with Reach, a notice given under this clause
          10.2 may only take effect at the start of a Quarter and will not
          apply to any invoices issued prior to it taking effect.

     (e)  Notwithstanding that notice is given under this clause and an invoice
          is issued to some other member of a Parent's Group, the Parent
          remains liable for the Outsourcing Fee as if no notice had been given
          and all invoices were issued directly to the Parent.

10.3 Payment procedure

     Except as otherwise agreed between Reach and a Parent, each Parent will
     make payment of the invoice in United States Dollars in accordance with
     the procedure set out in Annexure E ("Billing and Settlement").

10.4 Other Currencies

     (a)  Where Reach and a Parent agree that a portion of the Outsourcing Fee
          representing the recovery of a third party cost which is billed to
          the Reach Group in a currency other than US$ is to be recovered in
          the currency in which it is billed, that portion of the Outsourcing
          Fee will be payable by the Parent's Group in the currency in which it
          is billed to the Reach Group.

     (b)  Except for the costs referred to in clauses 10.4(a) and 10.5, all
          costs incurred by Reach will be converted into US$ and will be billed
          by Reach in, and will be payable to Reach in, US$.

10.5 Parent Group Charges

     Where a Parent renders charges to Reach which are recoverable from that
     Parent as an attributable cost (relevant charge):

     (a)  for the purpose of determining the component of the Outsourcing Fee
          on account of the relevant charge (relevant component), that
          component will be calculated in the currency in which the Parent
          bills Reach for the relevant charge; and

     (b)  the relevant charge will set off against the relevant component.

10.6 Disputed Amount

     Where a Parent is not satisfied that the Charges in an invoice are
     correct, it may notify a Billing Dispute in accordance with Annexure E
     ("Billing

                                                                              16

<PAGE>

     and Settlement") and that Billing Dispute will be dealt with in accordance
     with Annexure E ("Billing and Settlement"). Save in the case there is a
     manifest error in the invoice, the Parent must pay the disputed amount
     pending resolution of the dispute. This clause is subject to the rights of
     a party to make an election under clause 37.1.

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11   Audit Procedure

11.1 Audit right

     Reach Parent must procure that :

     (a)  each Parent is permitted at reasonable times and on reasonable
          notice, through their officers, agents or advisers authorised on
          their behalf, to:

          (i)  access to the premises of members of the Reach Group;

          (ii) examine, inspect, audit and copy any accounts and records
               relating to this agreement or the Outsourcing Services or which
               affect the amount of the Outsourcing Fee; and

         (iii) provide all necessary facilities for this purpose;

     (b)  the Reach Group complies with clause 11.1(a) however and wherever the
          records and accounts are stored or located; and

     (c)  in the case of documents or records stored on a medium other than in
          writing, make available to the Parent on request reasonable
          facilities necessary to enable a legible reproduction to be created.

11.2 Costs and Responsibility

     Subject to any express provision in this agreement to the contrary each
     party must bear its own costs of any audit.

11.3 No unreasonable interference In the exercise of the rights granted by this
     clause, a Parent must use reasonable endeavours not to unreasonably
     interfere with the Reach Group's activities in any material respect.

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12   Reach Capex Commitments

12.1 Parent Funded Non Cable Capex

     (a)  The Parents may individually or jointly agree with Reach to fund Non
          Cable Capex in which case the relevant Capex commitment in relation
          to that Non Cable Capex will be Parent Funded Non Cable Capex.

     (b)  The Parents will fund any Parent Funded Non Cable Capex in the
          following proportions:

                                                                              17

<PAGE>

          (i)  where the agreement to fund the relevant Capex commitment is
               with an individual Parent, that Parent will assume liability for
               the entire amount of the Capex commitment;

          (ii) where the agreement to fund the relevant Capex commitment is
               with both Parents, each Parent will fund that part of the Capex
               commitment allocated to the Parent in that agreement or in the
               absence of any such agreed allocation, in equal shares.

     (c)  Unless otherwise agreed between the Parents and Reach, any
          incremental operating expenses incurred in relation to Non Cable
          Capex will be recoverable as part of the Recovery Fee.

     (d)  The manner in which the Parents will fund Non Cable Capex and any
          incremental operating expenses in relation to that Capex, what rights
          they get in relation to that Non Cable Capex and the manner in which
          funds are to be contributed will be set out in the agreement with
          Reach which on signing will be deemed to be an annexure to this
          agreement.

12.2 Reach not to incur other Capex

     Subject to clause 12.3 ("De minimus"), Reach may only incur further Capex
     commitments if they are Funded Capex commitments or the commitment is:

     (i)  included in the current AOP; or

     (ii) is otherwise approved by the Board of Reach Parent (or any sub
          committee of the Board of Reach Parent to whom the right to give this
          approval has been delegated, currently the finance monitoring sub
          committee of the Board).

12.3 De minimus

     Notwithstanding clause 12.2 ("Reach not to incur other Capex"), Reach may
     incur up to US$10,000 per month of Unfunded Capex.

12.4 No change to terms applying to Funded Capex

     Reach must not change the terms and conditions applicable to Funded Capex
     or do or omit to do anything which would increase the liability of Reach
     or the Parents for the Funded Capex without first obtaining the approval
     of each Parent. Where the agreement to fund the relevant Capex commitment
     is with an individual Parent, only the approval of that Parent will be
     required to the change in terms and conditions.

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13   Additional Capacity

13.1 No obligation

     The parties acknowledge that nothing in the Capacity Allocation Agreement
     or this agreement:

                                                                              18

<PAGE>

     (a)  prevents a Parent acquiring Capacity directly from a third party; or

     (b)  requires a Parent to exercise its rights under this clause to make
          such Capacity, Acquired Capacity.

13.2 Acquired Capacity

     A Parent may by notice to Reach and the other Parent notify Reach that it
     proposes to make Capacity acquired by that Parent or a Related Body
     Corporate, Acquired Capacity of that Parent for the purpose of this
     agreement.

13.3 Provisions applying where a Parent gives notice

     (a)  Where a Parent gives notice under clause 13.2 ("Acquired Capacity"),
          Reach must as soon as is reasonably practical advise the Parent
          giving notice:

          (i)  whether it is technically feasible to integrate the relevant
               Capacity into Reach's network;

          (ii) what additional systems and equipment (if any) it would require
               to enable Reach to provide Telecommunications Services to the
               Parent if such Capacity were to become Acquired Capacity; and

         (iii) whether Reach has sufficient backhaul and other domestic
               Capacity available to enable Reach to provide Telecommunications
               Services to the Parent if such Capacity were to become Acquired
               Capacity and if not, when additional backhaul would be
               available.

     (b)  Where Reach gives notice under clause 13.3(a) ("Provisions applying
          where a Parent gives notice") that it would not be technically
          feasible to integrate the relevant Capacity into Reach's network or
          that additional systems and equipment would be required, the Parent
          concerned and Reach will meet to seek to address Reach's concerns
          which may require the Parent to procure the provision of additional
          systems and equipment to Reach either by funding the acquisition of
          the systems and equipment by Reach or otherwise so as to permit Reach
          to provide the relevant Telecommunications Services utilising such
          Capacity.

     (c)  Where Reach gives notice under clause 13.3(a) ("Provisions applying
          where a Parent gives notice") that it would be technically feasible
          to integrate the relevant Capacity into Reach's network and that no
          additional systems and equipment would be required, the relevant
          Capacity will become part of the Parent's Capacity on a date agreed
          between Reach and the Parent concerned which unless otherwise agreed
          will be the earliest date on which it would be reasonably practical
          to integrate the relevant Capacity into Reach's network.

     (d)  Where Reach gives notice under clause 13.3(a) ("Provisions applying
          where a Parent gives notice") that it would not be technically
          feasible to integrate the relevant Capacity into Reach's network or
          that

                                                                              19

<PAGE>

          additional systems and equipment would be required, and Reach and the
          Parent concerned are able to agree on a work around which would
          address Reach's concerns, the relevant Capacity will become part of
          the Parent's Capacity on a date agreed between Reach and the Parent
          concerned which unless otherwise agreed will be the earliest date on
          which it would be reasonably practical to integrate the relevant
          Capacity into Reach's network taking into account the implementation
          of the agreed work around.

     (e)  Reach will on the request of the Parent seeking Acquired Capacity
          inform the Parent (with a copy of such notification to be given to
          the other Parent) of the estimated incremental costs (if any) which
          Reach reasonably considers will be incurred as a result of making
          such Capacity, Acquired Capacity.

     (f)  Reach acknowledges that it is technically feasible to provide
          Telecommunications Services in relation to Capacity acquired on the
          Southern Cross Cable Network between Sydney and the United States of
          America.

13.4 Management of Acquired Capacity

     (a)  If requested by a Parent, Reach will administer and manage the
          Parent's rights and obligations in respect of Acquired Capacity and
          the agreements under which the Acquired Capacity is held.

     (b)  In administering and managing the Parent's Acquired Capacity under
          clause 13.4(a), Reach must act in accordance with guidelines agreed
          between Reach and the Parent and Reach to the extent required by the
          guidelines will consult with the Parent on all decisions and actions
          made by Reach in relation to the Acquired Capacity in accordance with
          those guidelines.

13.5 Withdrawal of Parent Acquired Capacity

     (a)  A Parent may by further notice of not less than six months notice to
          Reach (or such other period as may be agreed with Reach), such notice
          to be given prior to October in the Year preceding the Year in which
          it is to take effect, elect to withdraw Parent Acquired Capacity from
          the Parent's Capacity for the purpose of this agreement.

     (b)  A Parent which withdraws Acquired Capacity will remain liable for any
          incremental costs incurred in relation to that Capacity to the extent
          that they continue to be incurred by Reach following the withdrawal
          of that Capacity. Reach will use its reasonable endeavours to
          reallocate the resources the subject of those incremental costs or
          will at the request of the relevant Parent seek to terminate any
          agreement under which those incremental costs are incurred in which
          case any early termination costs will be recovered from the relevant
          Parent as part of the incremental costs in relation to that Acquired
          Capacity.

                                                                              20

<PAGE>

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14   Reach Recommendations

     (a)  As part of the Outsourcing Services, Reach must monitor the use of
          each Parent's Capacity.

     (b)  Reach must make recommendations to each Parent regarding any timely
          acquisitions of Capacity by that Parent which it believes are
          required in order to ensure that Reach is able to provide the Parent
          with Telecommunications Services in accordance with the Parent's
          forecasts and the relevant Performance Requirements for that Parent's
          Telecommunications Services.

     (c)  Neither Parent is obliged to acquire the additional Capacity
          recommended by Reach. However, to the extent that it fails to do so,
          Reach will be excused from any resulting failure to provide
          Telecommunications Services in accordance with the relevant forecasts
          or Performance Requirements.

     (d)  At the commencement of each Quarter or at any other time as and when
          considered necessary, Reach will meet with each Parent to discuss
          whether any acquisition of Capacity is required and if so, the likely
          extent of that Capacity.

     (e)  Where Reach recommends an acquisition of Capacity by the Parent,
          Reach must assist the Parent to acquire such additional Capacity on
          the best available commercial terms.

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15   Telecommunications Service Development

15.1 New Services

     Reach must use all reasonable endeavours during the Term consistent with
     the limitation imposed on Reach by the provisions of this clause 15, to
     improve the Telecommunications Services and to develop superior
     replacement services for the Telecommunications Services and to make those
     improvements and new services promptly available under this agreement.

15.2 Parent Funded Development

     (a)  Subject to the provisions of this clause, where requested by a
          Parent, Reach will develop new telecommunications services and
          improve the functionality of Telecommunications Services
          (Development) in accordance with the Parent's specifications in a
          timely and cost efficient manner.

     (b)  The Parents may individually or jointly agree with Reach to fund a
          Development in which case the relevant funding commitment will be a
          "Parent Funded Development".

     (c)  The Parents will be liable for the funds required for any Parent
          Funded Development in the following proportions:

          (i)  where the agreement to fund the Development is with an
               individual Parent, that Parent will be liable for the entire

                                                                              21

<PAGE>

               amount of funds required for the Development (subject to any
               limit agreed between the Parent and Reach);

          (ii) where the agreement to fund the Development is with both
               Parents, each Parent will be liable for that part of the funds
               required for the Development apportioned to the Parent in that
               agreement or in the absence of any allocation, in equal shares
               but subject to any agreed limit.

15.3 No unfunded development

     Subject to clause 15.4 ("De minimus"), Reach may not engage in any
     Development of telecommunications services which is not Parent Funded
     Development unless the funding for the development:

     (i)  is included in the current AOP; or

     (ii) is otherwise approved by the Board of Reach Parent (or any sub
          committee of the Board of Reach Parent to whom the right to give this
          approval has been delegated, currently the finance monitoring sub
          committee of the Board).

15.4 De minimus

     Notwithstanding clause 15.3 ("No unfunded development"), Reach may incur
     up to US$5,000 per month of Unfunded Development.

15.5 Compensation

     Where a Parent individually funds Development, the other Parent is not
     entitled to the benefit of the Development or to order any new
     Telecommunications Services which uses the benefit unless it reaches
     agreement with the Parent funding the Development under which it
     reimburses that Parent an equitable amount on account of the amount by
     which the Parent funded the Development.

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16   Restoration

16.1 External Restoration

     (a)  Where there is a fault in respect of a Telecommunications Service
          provided to a Parent or a member of a Parent's Group under this
          agreement and in order to rectify that fault in a cost effective
          manner, Reach is required to acquire additional Capacity on an
          interim basis (External Restoration Capacity) then the cost of that
          additional Capacity will be passed on to the Parent to whom the
          affected Telecommunications Service is being provided. Notice of the
          acquisition of External Restoration Capacity will be given to the
          Parent concerned in accordance with guidelines approved by the OSF.

     (b)  External Restoration Capacity is to be acquired and the Parent is
          liable for the cost of the External Restoration Capacity in
          accordance with guidelines approved by the OSF.

                                                                              22

<PAGE>

16.2 Internal Restoration

     (a)  Where there is a fault in respect of a Telecommunications Service
          provided to a Parent or some other member of the Parent's Group under
          this agreement and Reach is able to rectify that fault by using part
          of the other Parent's Capacity without diminishing in any way the
          quality of the Telecommunications Services provided to that other
          Parent, Reach may use that part of the other Parent's Capacity
          (Internal Restoration Capacity) for this purpose.

     (b)  There will be no charge for the use of Internal Restoration Capacity
          where it is used for a period not exceeding 6 weeks.

     (c)  Where the Internal Restoration Capacity is used for a continuous
          period exceeding 6 weeks, the Parent who receives the benefit of the
          Internal Restoration Capacity must pay to the other Parent
          compensation for any use of the Internal Restoration Capacity for the
          portion of the period of use exceeding 6 weeks in accordance with the
          principles for compensation set out in clause 20.

     (d)  Reach must notify both Parents prior to or as soon as practical
          thereafter using the Internal Restoration Capacity.

     (e)  Unless otherwise agreed between the Parents, Reach must cease using
          Internal Restoration Capacity for the purpose set out in paragraph
          (a) where the use of that Capacity would prevent Reach provisioning
          Telecommunications Services ordered by that other Parent's Group or
          would otherwise diminish the quality of the Telecommunications
          Services provided to that other Parent's Group.

16.3 Reports

     Reach will report to the Parents on a monthly basis on:

     (a)  the planned outages in the Reach Network expected in the forthcoming
          month;

     (b)  what additional Capacity is required to cover those planned outages
          and where that Capacity will be sourced and on what terms;

     (c)  what steps are being taken to rectify any faults which have caused or
          are likely to cause outages.

16.4 Obligation to minimise faults

     Reach will use its reasonable endeavours to:

     (a)  minimise faults in the Reach Network which cause outages; and

     (b)  rectify such faults as soon as is reasonably practical.

                                                                              23

<PAGE>

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17   Committed Third Party Data Services

17.1 No new Committed Third Party Data Contracts

     Without the prior approval of each Parent, Reach will not enter into any
     new Committed Third Party Data Contracts or renew the term of any
     Committed Third Party Data Contract.

17.2 Existing Committed Third Party Data Contracts

     Reach will continue to provide Committed Third Party Data Services to
     Committed Third Party Customers in accordance with the principles set out
     in Annexure D ("Committed Third Party Data Services - transition and
     extension principles").

17.3 Not used

17.4 Transition of Committed Third Party Data Services

     Reach and the Parents will comply with the transition principles set out
     in Annexure D ("Committed Third Party Data Services - transition and
     extension principles").

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18   Staff and other resources

18.1 Provision of staff

     Reach must provide and maintain the necessary staff and resources to
     enable it to perform its obligations in accordance with this agreement.

18.2 Responsibility for staff

     Reach acknowledges that:

     (a)  it is responsible for its own employees;

     (b)  any act or omission of any of those employees, whether or not the
          employee is acting lawfully or within his or her authority, is an act
          or omission of Reach;

     (c)  it must procure compliance by all its employees with the obligations
          of Reach under this agreement,

     and Reach must pay the salaries, insurance premiums, payroll tax,
     superannuation levies, leave expenses and any other monies payable in
     relation to its employees.

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19   Reach Systems and Equipment

19.1 Reach Systems

     Reach must provide the Reach Systems and any other systems needed to
     properly provide the Telecommunications Services in accordance with this
     agreement.

                                                                              24

<PAGE>

19.2 Maintenance and Repair

     Reach must keep and maintain the Reach Systems in good order and repair
     and in sound working condition.

19.3 Reach Equipment

     Reach must provide the Reach Equipment and any other hardware required to
     properly provide the Outsourcing Services in accordance with this
     agreement.

19.4 Title

     As between Reach and the Parents, Reach retains full title to, and risk in
     relation to, the Reach Equipment at all times.

19.5 Maintenance and Repair

     It is Reach's responsibility to keep and maintain the Reach Equipment in
     good order and repair and in sound working condition, including the
     payment of all repair and operational expenses.

19.6 Parent's Systems and Equipment

     Where this agreement provides that Reach is not obliged to do something
     unless a Parent agrees to fund the acquisition of equipment, the Parent
     may elect to provide that equipment to Reach instead of funding the
     acquisition.

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20   Trespass

     (a)  Except as set out in clause 16.2 ("Internal Restoration"), where
          after 30 June 2005 the provision of a Telecommunications Service to a
          Parent makes use of the other Parent's Capacity, the Parent to whom
          the Telecommunications Service is being provided will reimburse the
          other Parent for the use of that Capacity at fair market value.

     (b)  Where the use of the other Parent's Capacity under paragraph (a)
          continues for 6 months or for periods which in aggregate exceed 6
          months in any 12 month period, the other Parent has the right to
          require the Parent to whom the Telecommunications Service is being
          provided to purchase the Capacity at fair market value.

     (c)  Where the fair market value of Capacity or use of Capacity is to be
          determined for the purpose of this clause it is to be determined in
          accordance with the following principles:

          (i)  Each Parent will obtain and provide to the other bona fide
               quotes for the acquisition or use of equivalent Capacity (as the
               case may be).

          (ii) The fair market value will be the average of the two quotes
               except where the higher quote exceeds by more than fifteen
               percent the lower quote.

         (iii) Where the higher quote exceeds by more than fifteen percent the
               lower quote, resolution of fair market value will be

                                                                              25

<PAGE>

               referred to the OSF for resolution and if the OSF is unable to
               resolve the matter, it will be dealt with under clause 38
               ("Dispute Resolution").

     (d)  For the avoidance of doubt, the parties acknowledge that nothing in
          this clause 20 permits the provision of a Telecommunications Service
          to a Parent using the other Parent's Capacity and Reach must monitor
          and notify the Parents where it occurs. Any encroachment on the other
          Parent's Capacity must immediately cease if requested by the other
          Parent.

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21   Reports

     Reach must deliver reports to each Parent containing the content and at
     the times determined by the OSF. These reports must enable the Parents to
     determine the extent to which Reach is providing the Telecommunications
     Services in accordance with the Performance Requirements.

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22   No set off

22.1 Parent not entitled to set off amounts

     Subject to clause 22.2 ("Set off under the AJC Indemnity Agreement"), a
     Parent may not set off any amount owed by Reach to the Parent on any
     account whatsoever against any amount payable by the Parent to Reach on
     account of the Charges.

22.2 Set off under the AJC Indemnity Agreement

     Notwithstanding clause 22.1 ("Parent not entitled to set off amounts"),
     Telstra may set off against any amount due by Telstra to Reach under this
     agreement, any amount due for payment by Reach to Telstra under the AJC
     Indemnity Agreement.

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23   Minimal Cost

     (a)  The Outsourcing Services provided under this agreement must be
          provided in a manner so as to minimise the Outsourcing Fee payable by
          each Parent to extent that this is practical without adversely
          impacting on the provision of the Telecommunications Services in
          accordance with the applicable Performance Requirements.

     (b)  The parties acknowledge that it is their objective and expectation
          that, in real dollar terms when measured against the Outsourcing
          Services provided in each Year, the Outsourcing Fee will decline on a
          Year by Year basis as Reach achieves greater efficiencies and lowers
          its cost base.

     (c)  The Parents may request Reach to provide written details of processes
          in place and steps taken by Reach to measure and achieve the
          objective and requirements set out in this clause. Reach must respond
          to any such request within 30 Business Days.

                                                                              26

<PAGE>

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24   Review of Performance Requirement

     Reach must meet with each Parent on a quarterly basis to discuss whether
     the Performance Requirements should be varied. If, following those
     discussions, Reach and the Parent are unable to reach agreement, the
     Parent may elect to refer any outstanding issues to the OSF for
     resolution. Issues which are not resolved by the OSF will be dealt with in
     accordance with clause 38 ("Dispute Resolution").

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25   Forecasts

     Each Parent must provide Reach with quarterly forecasts on a rolling 12
     month basis setting out its forecast requirements for each
     Telecommunications Service in accordance with Annexure F ("Forecasting,
     Ordering and Provisioning") and its anticipated requirements for the
     development of new Telecommunications Services. These forecasts will form
     an input to the AOP for the following Year. In addition, each Parent must
     provide Reach with indicative quarterly forecasts for a rolling three year
     period setting out its forecast Telecommunications Services requirements
     for each Telecommunications Service.

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26   Disaster recovery

     Reach must prepare and submit to the OSF for approval a disaster recovery
     plan and must update and submit that plan to the OSF for approval on an
     annual basis (or as otherwise determined by the OSF). It is acknowledged
     that the plan will also need to be approved by the board of directors of
     the Reach Parent.

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27   Insurance

27.1 Maintain insurance policies

     Reach must take out and maintain with reputable insurers the insurance
     policies provided for in each AOP.

27.2 Compliance

     Reach must comply with all of the terms and conditions of any insurance
     policy taken out by Reach under clause 27.1 ("Maintain insurance
     policies").

27.3 Evidence

     Reach must on request by a Parent, promptly provide to the Parent:

     (a)  copies of the insurance policies; and

     (b)  a certificate of currency for the insurance policies.

                                                                              27

<PAGE>

--------------------------------------------------------------------------------
28   Taxes

     (a)  The Parent and any member of the Parent's Group who is invoiced for
          Charges must pay the Charges payable to Reach free of any deduction
          or withholding on account of Taxes, except where required by law, in
          which event the payer (the "Payer") must:

          (i)  ensure that the deduction or withholding does not exceed the
               minimum amount legally required;

          (ii) also pay to Reach such additional amount (the "gross-up amount")
               as shall result in the net amount received by Reach being equal
               to the amount which would have been received had no such
               deduction or withholding been made;

         (iii) pay to the relevant tax authority within the requisite period
               the full amount of the deduction or withholding (including the
               full amount of any deduction or withholding on any gross-up
               amount); and

          (iv) upon a written request from Reach furnish a copy of an official
               receipt (if available) of the amount deducted or withheld and
               paid to the tax authority or other evidence of the relevant
               deduction or withholding.

     (b)  If Reach receives a tax credit as a result of a payment to a tax
          authority under this clause, it shall forthwith pay to the Payer an
          amount equal to the tax credit.

     (c)  Any Taxes, other than tax on net income, imposed by any government
          authority on or with respect to services acquired by Reach from a
          Local Reach PoP, Hong Kong PoP or third party will be recoverable
          from the Parents as part of the Recovery Fee.

     (d)  Nothing in this clause 28 ("Taxes") requires a Parent to pay any
          amount on account of a fine, penalty or interest for which Reach is
          liable unless such fine, penalty or interest is incurred as a result
          of an action or inaction by a Parent, nor pay any Taxes that are
          otherwise recoverable by Reach.

     (e)  In the event of a change of Tax law by virtue of an enactment,
          amendment, replacement or repeal of Tax legislation or a change of
          practice by a Tax authority in a jurisdiction affecting a supply or
          acquisition of services by a party under this agreement, then upon
          the request from any party, the parties will (without prejudice to
          any other rights the requesting party may have) enter into good faith
          negotiations as soon as practicable, to amend or vary this agreement
          to the extent the requesting party reasonably considers necessary to
          address its Tax concerns, taking into account the ability or
          otherwise of Reach to enjoy the benefit of any tax credits arising as
          a result of any Tax law change.

     (f)  Where there are any particular tax issues in respect of this
          agreement, the parties must use their respective reasonable
          endeavours to

                                                                              28

<PAGE>

          mitigate any adverse effect on the other parties. However, no party
          will be obliged to prejudice its own tax position, pay any increased
          amount (including increased Charges) nor prejudice any of its rights
          or remedies under this agreement.

     (g)  The parties will reasonably co-operate with each other over any tax
          dispute involving this agreement.

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29   OSF

29.1 Establishment of OSF

     The parties will as soon as practicable, establish an Outsourcing Services
     Forum (OSF) which will be responsible for co-ordinating the implementation
     of this agreement including any matters referred to it pursuant to this
     agreement.

29.2 Workings of OSF

     The OSF may:

     (a)  delegate such matters as it determines to one or more specialised
          sub-groups ("Working Groups");

     (b)  direct each Working Group to report to it on such matters as it
          determines; and

     (c)  establish rules to govern the conduct of each Working Group.

29.3 Rules of OSF

     The rules of the Working Group should provide for:

     (a)  subject areas dealt with by each Working Group;

     (b)  chairmanship and administrative functions of the Working Group to be
          shared on an agreed basis; and

     (c)  formal notification procedures to the Working Group.

     Unless the parties agree otherwise, each party will have an equal number
     of representatives on the OSF and any Working Groups.

     The OSF will meet at times to be agreed between the parties ("regular
     meeting").

     Without limiting the meetings of the OSF under this clause a party may
     request a special meeting of the OSF by giving the other parties not less
     than 10 Business Days notice, provided that a special meeting may not
     occur within 5 Business Days of a regular meeting unless the parties
     agree.

     The OSF may meet in any manner agreed between the parties, including, for
     the avoidance of doubt, by telephone.

                                                                              29

<PAGE>

     Written minutes must be agreed and kept of all meetings of the OSF and any
     Working Group. A copy of draft minutes relating to a meeting must be given
     by the party responsible for keeping such minutes (as agreed between the
     parties) to the other parties within 10 Business Days after the relevant
     meeting.

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30   Confidentiality

30.1 Privacy Obligations

     A party shall be under no obligation to provide the other parties with any
     information, including without limitation, any personal information
     pertaining to any End Customer, where such disclosure is inconsistent with
     any Privacy Laws.

30.2 Fraud and Bad Debt Prevention

     To the extent permitted by law or agreed between the parties, the parties
     will exchange information and otherwise co-operate in relation to:

     (a)  the prevention and investigation of fraudulent use or misuse of the
          parties' respective services or the theft of equipment; and

     (b)  the prevention and minimisation of incidents of Network or
          telecommunications fraud.

30.3 Disclosure or Use of Confidential Information

     Each party must keep confidential all Confidential Information of the
     other parties and must not:

     (a)  use such Confidential Information except as permitted by this
          agreement; or

     (b)  disclose or communicate, cause to be disclosed or communicated or
          otherwise make available such Confidential Information to any third
          person except as permitted by this agreement.

30.4 Permitted Disclosure

     A party ("disclosing party") may disclose the Confidential Information of
     another party ("providing party"):

     (a)  to those of its People to whom the Confidential Information is
          reasonably required to be disclosed for the purposes of this
          agreement; or

     (b)  to any professional person acting for the disclosing party to the
          extent necessary to permit that person to protect or advise on the
          rights of the disclosing party in respect of the obligations of the
          disclosing party under this agreement; or

     (c)  to an auditor acting for the disclosing party to the extent necessary
          to permit that auditor to perform its audit functions;

                                                                              30

<PAGE>

     (d)  in connection with Dispute Resolution Procedures set out in this
          agreement or legal proceedings or for the purpose of seeking advice
          from a professional person in relation thereto; or

     (e)  as required or permitted by law, provided that the disclosing party
          has first notified the providing party that it is required to
          disclose the Confidential Information so that the disclosing party
          has an opportunity to protect the confidentiality of its Confidential
          Information; or

     (f)  with the consent of the disclosing party, provided that if required
          by the providing party as a condition of giving its consent, the
          disclosing party must comply with clause 30.6 ("Conditions on consent
          to disclosures of Confidential Information"); or

     (g)  in accordance with a lawful and binding directive issued by a
          Regulator; or

     (h)  to a tax authority if reasonably requested by the tax authority; or

     (h)  if reasonably required to protect the safety of personnel or
          equipment; or

     (i)  as required by the rules or regulations of any stock exchange where
          that party's securities are listed or quoted.

30.5 Procedures to protect Confidential Information

     Each party must establish and observe procedures adequate to protect the
     Confidential Information of a providing party, including, without
     limitation, ensuring that each of its People to whom that Confidential
     Information is disclosed is subject to and maintains the confidentiality
     obligations consistent with those set out in this clause 30
     ("Confidentiality").

30.6 Conditions on consent to disclosures of Confidential Information

     If required by a providing party as a condition of it giving its consent
     to the disclosure of its Confidential Information to a third person
     ("disclosee"), the disclosing party, before disclosing that Confidential
     Information, must:

     (a)  impose an obligation upon the disclosee:

          (i)  to use the Confidential Information disclosed solely for the
               purposes for which the disclosure is made and to observe
               appropriate confidentiality requirements in relation to such
               information; and

          (ii) not to disclose the Confidential Information without the prior
               written consent of the disclosing party; and

     (b)  obtain an acknowledgment from such a disclosee that:

          (i)  the Confidential Information is and at all times remains
               proprietary to the providing party; and

                                                                              31

<PAGE>

          (ii) that misuse or unauthorised disclosure of the Confidential
               Information will cause serious harm to the providing party.

     Each party must co-operate, where reasonable to do so, in any action taken
     by the providing party to:

     (i)  protect the confidentiality of the providing party's Confidential
          Information; or

     (ii) enforce that the providing party's rights in relation to its
          Confidential Information.

     Confidential Information provided by a party to another party is provided
     for the benefit of the other party only.

     Telstra may disclose Confidential Information to the Commonwealth of
     Australia as required or authorised by the Telstra Corporation Act 1991
     (Cth).

30.7 Third party Confidential Information

     Nothing in this agreement may be construed as requiring a party at any
     time to disclose to another party information which is the subject of a
     confidentiality obligation owed to a third person unless the third person
     consents to such disclosure. Where the consent of a third person is
     required, the party holding the information must use its reasonable
     endeavours to obtain the consent of that third person.

30.8 Announcements

     (a)  Subject to clause 30.8(b), no party may make or send a public
          announcement, communication or circular concerning the transactions
          referred to in this agreement unless it has first obtained the
          written consent of the other parties which consent is not to be
          unreasonably withheld or delayed.

     (b)  Clause 30.8(a) does not apply to a public announcement, communication
          or circular required by law or a regulation of a stock exchange
          ("Announcement"). Each party must provide the other parties with a
          draft of such Announcement prior to its release.

--------------------------------------------------------------------------------
31   Regulatory Event

31.1   Right to request good faith negotiations

       Notwithstanding any other provision of this
       agreement, if:

     (a)  in the opinion of a party acting reasonably, a Regulatory Event may
          occur or is likely to occur in relation to it, then upon request from
          that party; or

     (b)  a Legislative Event occurs, or in the opinion of a party, a
          Legislative Event may or is likely to occur, then upon request from
          any party,

                                                                              32

<PAGE>

     the parties will (without prejudice to any other rights the requesting
     party may have) enter into good faith negotiations as soon as practicable,
     to amend or vary this agreement to the extent the requesting party
     reasonably considers necessary to address its concerns regarding such a
     Regulatory Event or Legislative Event, as the case requires. However no
     such amendments are required to become effective until a reasonable period
     of time before the Regulatory Event or Legislative Event occurs.

31.2 Right to suspend or terminate

     Notwithstanding any other provision of this agreement, if a Regulatory
     Event occurs in relation to a party ("affected party"), that party may:

     (a)  suspend all or part of the performance of its obligations (other than
          those under clause 30 ("Confidentiality") and this clause 31
          ("Regulatory Event") or its obligation to pay moneys due and payable)
          under this agreement with effect from such date as it may reasonably
          determine and notify the other parties of such suspension as soon as
          reasonably practical but by no later than the time of such
          suspension; and/or

     (b)  by giving notice to the other parties, amend this agreement
          (including terminating the provision of one or more of the Services),

     to the extent that it determines necessary (acting in good faith), in
     order to comply with the Regulatory Event.

31.3 Failure to agree

     If, within a reasonable period after the exercise by a party of its rights
     under clause 31.2 ("Right to suspend or terminate"), the other parties do
     not agree with that exercise of such rights, they:

     (a)  may notify a dispute which will be resolved in accordance with the
          Dispute Resolution Procedure; or

     (b)  (in the event it is a Parent) may terminate the provision to it of
          any Service the supply of which has been or will be affected by the
          suspension or amendment under clause 31.2 ("Right to suspend or
          terminate"), by the giving of not less than 10 Business Days notice;
          or

     (c)  seek a declaration from a court of competent jurisdiction that the
          relevant amendment or suspension as the case may be should no longer
          apply having regard to the impact of the Regulatory Event or
          Legislative Event on the other party provided, however, that neither
          party may:

          (i)  seek any compensation for or in relation to any loss occasioned
               prior to the date of any such declaration by the court; or

          (ii) seek a declaration having any retrospective effect.

                                                                              33

<PAGE>

--------------------------------------------------------------------------------
32   Intellectual Property

32.1 Rights

     Except in as provided in any agreement reached between Reach and a Parent
     for the purpose of clause 15 in respect of a specific Development, all
     right, title and interest in and to any:

     (a)  Intellectual Property owned by a party prior to the Commencement
          Date, remains owed by that party; and

     (b)  Intellectual Property (in relation to matters the subject of this
          agreement) developed after the Commencement Date, subject to
          sub-clause (c), vests in the party who developed that Intellectual
          Property or for whom that Intellectual Property was developed by a
          third person; and

     (c)  improvements to or adaptations, versions or modifications of
          Intellectual Property (in relation to matters the subject of this
          agreement) vests in the party who developed that Intellectual
          Property or for whom that Intellectual Property was developed by a
          third person.

     The parties will negotiate arrangements (including in respect of ownership
     rights) concerning Intellectual Property jointly developed in the course
     of performing or otherwise in connection with this agreement.

32.2 Infringement

     If a party becomes aware of any infringement or threatened infringement of
     any Designated IP under this agreement, the party must promptly notify the
     IP Owner identifying (if possible) the infringer and the infringement or
     potential infringement.

32.3 Protection of rights

     The IP Owner may take such steps and proceedings as it considers necessary
     or desirable to protect its rights in respect of the Designated IP and the
     rights of any other party to which Services are supplied using such
     Designated IP and each IP User must render all reasonable assistance in
     connection with those steps or proceedings at the request and expense of
     the IP Owner.

32.4 Rights on infringement

     If it is determined by an independent tribunal of fact or law or if it is
     agreed between the parties to a dispute that Designated IP used by a party
     ("Infringing Party") in supplying Services to the another party for the
     purposes of this agreement has infringed any Intellectual Property of any
     person, the Infringing Party, at its option:

     (a)  may procure a right to continue using the infringing Designated IP; or

     (b)  may  modify  or  replace  the  infringing  Designated  IP so that  the
          infringement, defect or inadequacy is removed; or

                                                                              34

<PAGE>

     (c)  may, if it is unreasonable,  having regard to the likely costs, likely
          consequences  for  IP  Users  and  other  relevant  matters,  for  the
          Infringing Party to implement a solution set out in clauses 32.4(a) or
          (b) ("Rights on infringement"),  withdraw the infringing Designated IP
          on 5 Business Days notice.

32.5 Parties to discuss

     The parties recognise that where infringing Designated IP has been
     withdrawn by the Infringing Party under clause 32.4(c) ("Rights on
     infringement") and that infringing Designated IP was used:

     (a)  in a Service provided by the Infringing Party to an IP User; and

     (b)  by the Infringing Party in its own operations,

     it is in the interests of the parties that the situation be promptly
     resolved and the Infringing Party and each IP User will discuss
     alternative solutions and joint action which can be undertaken.

32.6 Limit of rights

     Each party acknowledges to the other that clause 32.4 ("Rights on
     infringement") sets out the only rights available to a party in relation
     to or arising from an allegation, agreement or determination (or any act,
     matter or thing relating to or arising from such an allegation, agreement
     or determination) that Designated IP used by the party, in supplying
     Services, or that Intellectual Property disclosed, licensed or provided by
     another party under or for the purposes of this agreement has infringed or
     infringes any rights of another person.

32.7 No right to use other name and logo

     A party must not use another party's name, logo, trade marks or get up,
     without the prior written consent of that party.

32.8 No licence

     The parties acknowledge that save as expressly provided by this agreement,
     no member of a Group has any licence to use Reach's Intellectual Property
     as a result of this agreement.

--------------------------------------------------------------------------------
33   Force Majeure

33.1 Suspension of obligations

     If a party is unable to perform any of its obligations (other than an
     obligation to pay money including any agreement to pay Capex or the
     Outsourcing Fee) under this agreement by reason of Force Majeure and that
     party:

     (a)  gives the other parties prompt notice of and reasonably full details
          of the Force Majeure and an estimate of the extent and duration of
          its inability to perform; and

                                                                              35

<PAGE>

     (b)  uses all possible diligence to remove that Force Majeure as quickly
          as possible,

     that obligation is suspended for the minimum extent and duration of that
     Force Majeure.

33.2 Force Majeure continuing for more than 10 Business Days

     If the Force Majeure continues more than 10 Business Days after the notice
     given under clause 33.1 ("Suspension of obligations"), the parties must
     meet to discuss in good faith a mutually satisfactory resolution to the
     problem.

33.3 Strikes

     The requirement that a Force Majeure be removed with all possible
     diligence does not require the settlement of strikes, lockouts or other
     labour disputes or claims or demands on unreasonable terms in the
     reasonable opinion of the party affected by such events. If a strike,
     lockout or other labour dispute or claim or demand principally concerns
     any matter the subject of this agreement, the affected party must advise
     the other parties.

--------------------------------------------------------------------------------
34   Reach default

34.1 Reach Default Notice

     (a)  Telstra and PCCW may, if they both agree, jointly issue a Default
          Notice to Reach if:

          (i)  Reach is in Material Breach and, if that breach is capable of
               remedy, Reach has failed to remedy that breach within 10
               Business Days of a notice from either Parent requesting it to do
               so;

          (ii) Reach or any other member of the Reach Group is in material
               breach of any other Transaction Document and, if that
               Transaction Document contains an applicable cure period, that
               default has not been remedied within that cure period; or

         (iii) a Reach Insolvency Event has occurred.

     (b)  For the avoidance of doubt, it is expressly acknowledged that Telstra
          and PCCW may only issue a Default Notice jointly with the other and
          may not do so without the other's consent.

     (c)  A Default Notice may be issued in conjunction with other notices
          issued under the Transaction Documents, whether they are contained
          within the one notice or otherwise.

     (d)  The obligation of each Parent to make a payment which falls due for
          payment after the issue of a Default Notice is suspended during the
          currency of a Default Notice.

                                                                              36

<PAGE>

34.2 Termination

     (a)  No party may terminate this agreement except in accordance with this
          clause.

     (b)  No party other than a Parent may terminate this agreement.

     (c)  Telstra and PCCW may only terminate this agreement by acting jointly,
          if they both agree and if:

          (i)  a Default Notice has been issued under this agreement; or

          (ii) a Default Notice (as defined in the Capacity Allocation
               Agreement) has been issued under the Capacity Allocation
               Agreement.

     (d)  For the avoidance of doubt, it is expressly acknowledged that Telstra
          and PCCW may only terminate this agreement jointly with the other and
          may not do so without the other's consent.

34.3 Damages

     The parties acknowledge that if this agreement is terminated for breach by
     Reach that termination will result in a loss by the Parents of the right
     to receive the Outsourcing Services and the Losses reasonably within the
     contemplation of the parties as a probable result of that breach and
     subsequent termination include:

     (a)  the loss of revenue as a result of the interruption to the Parents'
          respective businesses resulting from the loss of their rights to
          receive the Outsourcing Services;

     (b)  costs incurred by the Parents to acquire replacement services;

     (c)  damages payable by the Parents to their customers resulting from the
          loss of the Outsourcing Services; and

     (d)  damage to the reputation of the Parents.

--------------------------------------------------------------------------------
35   Not used

36   Suspension

     Reach may, without prior notice, immediately suspend the supply of a
     Service or access to the Network operated by Reach:

     (a)  during an Emergency, to the extent Reach reasonably considers
          necessary to address the Emergency; or

     (b)  if the supply of that Service or access to the Network operated by
          Reach poses a threat to Network security.

     Reach is entitled to continue such suspension until the relevant Emergency
     or threat has passed.

                                                                              37

<PAGE>

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37   Parent Payment Default

37.1 Reach to advise others

     If a Parent (Defaulting Parent) fails to make, or advises Reach that it
     will not make, a payment due from it under this agreement (Disputed
     Payment) then Reach must notify the other Parent (Non-Defaulting Parent)
     of such failure or advice immediately and either Parent may then by notice
     to the other elect that the provisions of clause 37.2 will apply. The date
     on which a Parent gives notice to the other Parent is referred to as the
     Dispute Date.

37.2 Resolution of Payment Dispute

     (a)  The Chief Executive Officer of each of Telstra and PCCW (or their
          nominees) must enter into discussions in good faith to seek to
          resolve any dispute giving rise to the Disputed Payment by the
          Defaulting Parent (Payment Dispute) within 7 Business Days of the
          Dispute Date.

     (b)  If the Payment Dispute is resolved in accordance with paragraph (a)
          within 7 Business Days of the Dispute Date then the Defaulting Parent
          must make any payment determined in accordance with that resolution.
          If the Defaulting Parent does not make any payment in accordance with
          that resolution then the Payment Dispute will be deemed not to be
          resolved and the remaining provisions of this clause will apply.

     (c)  If the Payment Dispute is not resolved within 7 Business Days of the
          Dispute Date then the Defaulting Parent must pay the amount of the
          Disputed Payment within a further 3 Business Days, failing which:

          (i)  unless Reach has received payment under sub-paragraph (ii) or
               otherwise from the Non-Defaulting Shareholder (in which case any
               arrangements agreed for that funding will apply), the
               Non-Defaulting Parent may, but is not obliged to, make the
               payment of the amount of the Disputed Payment on behalf of the
               Defaulting Parent, in which case that payment will be deemed to
               be a loan from the Non-Defaulting Parent to the Defaulting
               Parent, repayable on demand and incurring interest at the
               Interest Rate, calculated daily and compounding monthly from the
               date that the Non-Defaulting Parent makes payment under this
               clause until the date that it receives repayment of the loan and
               all accrued interest in full from the Defaulting Parent;

          (ii) if the Non-Defaulting Parent does not make the Disputed Payment
               within 20 Business Days of the Dispute Date, or gives a notice
               to Reach that it will not make that payment, then Reach may
               issue proceedings against the Defaulting Parent for the amount
               of the Disputed Payment and damages in respect of its failure to
               make that payment, plus interest on the amount of the Disputed
               Payment at the Interest Rate, calculated daily and compounding
               monthly from the date that the amount of the Disputed Payment
               was initially due under

                                                                              38

<PAGE>

               this agreement until the date that it receives payment of
               that amount.

     (d)  If the Non-Defaulting Parent makes payment of the Disputed Payment
          under sub-paragraph (c)(i), then the Non-Defaulting Parent may at its
          option, and as its sole remedy, either:

          (i)  demand repayment of the loan and payment of all accrued interest
               referred to in that sub-paragraph together with any direct costs
               arising from the failure of the Defaulting Shareholder to make
               the Disputed Payment, in which case the Defaulting Parent must
               make those payments within 5 Business Days of the demand; or

          (ii) elect if the amount of the Disputed Payment either by itself or
               when added to other outstanding Disputed Payments exceeds
               $5,000,000 (Outstanding Payments), to acquire a volume of IRUs
               and or MIU Points held by, or reserved for, the Defaulting
               Parent (or if the Defaulting Parent is PCCW, the PCCW Capacity
               Holder) under the Capacity Allocation Agreement, as nominated by
               the Non-Defaulting Parent, of a value, based on a fair market
               value of those IRUs and or MIU Points calculated in accordance
               with clause 37.3 ("Valuation of IRUs and MIU points"), which
               does not exceed the amount of the Outstanding Payments, for a
               purchase price equal to that value in which case the Parents
               (and where the Defaulting Parent is PCCW, the PCCW Capacity
               Holder) must procure the transfer of such IRUs or MIU points to
               the Non-Defaulting Parent in accordance with clause 12.1
               ("Capacity Trading - Transfers") of the Capacity Allocation
               Agreement and, on completion of such transfers, the loan
               referred to in sub-paragraph (d)(i) and any interest accrued on
               it will be applied in payment of the purchase price with any
               remaining balance to be repaid to the Non-Defaulting Parent
               (Remaining Balance).

          For the avoidance of doubt, it is acknowledged that the
          Non-Defaulting Parent may not both demand repayment under paragraph
          (i) and elect to acquire IRUs or MIU points under paragraph (ii) in
          relation to the same Disputed Payment. However, the Non-Defaulting
          Parent may elect to determine the value of IRUs or MIU points under
          clause 37.3 ("Valuation of IRUs and MIU points") prior to it electing
          to either demand repayment under paragraph (i) or to acquire IRUs or
          MIU points under paragraph (ii) and may recover any Remaining Balance
          by way of a demand under paragraph (i).

     (e)  The PCCW Capacity Holder agrees to abide by and give effect to any
          transfer of IRUs and MIU points to Telstra which is contemplated by
          clause 37.2(d)(ii) as if it were PCCW and agrees that any application
          of the loan in payment of the purchase price for the transfer of IRUs
          and MIU points as provided for in clause 37.2(d)(ii) will be deemed
          to be the receipt of the purchase price by the PCCW Capacity Holder.

                                                                              39

<PAGE>

     (f)  For the avoidance of doubt, Reach's remedies under this clause 37.2
          are its only remedies in respect of the Payment Dispute.

37.3 Valuation of IRUs and MIU points

     Prior to or after making an election under clause 37.2(d), the
     Non-Defaulting Parent may notify the Defaulting Parent that it wishes to
     determine the fair market value of an IRU held by, and or a MIU point
     reserved for, the Defaulting Parent, on one of more cable systems in which
     case the fair market value of those IRUs or MIU points is to be determined
     in accordance with the following principles:

     (a)  Each Parent will obtain and provide to the other bona fide quotes for
          the acquisition of the IRUs or MIU points on the nominated cable
          system or cable systems (as the case may be).

     (b)  The fair market value will be the average of the two quotes except
          where the higher quote exceeds the lower quote by more than 15
          percent of the lower quote.

     (c)  Where the higher quote exceeds the lower quote by more than 15
          percent of the lower quote, then the Non-Defaulting Parent may elect
          that the determination of the fair market value be referred for
          resolution in the manner set out in clause 38.3.

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38   Dispute Resolution

38.1 Manner in which disputes to be resolved

     If a dispute arises between the parties in connection with or arising from
     this agreement, the dispute shall be resolved as follows:

     (a)  if the dispute arises on a matter under the Billing and Settlement
          Costing Information Procedures, the dispute shall first be referred
          to the nominated contacts in accordance with Annexure E ("Billing and
          Settlement");

     (b)  if the dispute is a Billing Dispute, the dispute shall first be
          referred to the nominated contacts in accordance with Annexure E
          ("Billing and Settlement");

     (c)  if the dispute arises on a matter under the Ordering and Provisioning
          Procedures, the dispute shall first be referred to the nominated
          contacts in accordance with Annexure F ("Forecasting, Ordering and
          Provisioning");

     (d)  if the dispute arises on a matter under the Operations and
          Maintenance Procedures, the dispute shall first be referred to the
          nominated contacts in accordance with Annexure G ("Operations and
          Maintenance");

     (e)  if a dispute as described in paragraphs (a), (b), (c) or (d) is not
          resolved within the time limits imposed by the relevant procedures,
          or if the dispute is not on a matter as described in paragraphs (a),
          (b),

                                                                              40

<PAGE>

          (c) or (d), a party to the dispute may, by notice to the other
          parties to the dispute, refer the dispute for resolution under clause
          38.2 ("Notice of Dispute").

38.2 Notice of Dispute

     (a)  Any dispute included in a notice under clause 38.1(e) ("Manner in
          which disputes to be resolved") shall be referred to the OSF or to a
          Working Group established by the OSF for resolution. The OSF or the
          Working Group shall endeavour to resolve the dispute within [10]
          Business Days of the date of that notice or within such other period
          as may be agreed by the parties.

     (b)  If the OSF or the Working Group does not resolve the dispute within
          the time specified in clause 38.2(a) ("Notice of Dispute"), a party
          to the dispute may by notice to the other parties to the dispute
          refer the dispute for resolution under clause 38.2(c) ("Notice of
          Dispute").

     (c)  Any dispute included in a notice under clause 38.2(b) ("Notice of
          Dispute") shall be referred to the Chief Executive Officer of Reach
          and a nominated direct report to the Chief Executive Officer of the
          Parent or Parents who are party to the Dispute for a period of 10
          Business Days. If after that period (provided the Chief Executive
          Officer and the nominated direct report have met (whether in person
          or electronically) at least twice to discuss the dispute) there is no
          resolution of the dispute, the dispute must be referred to
          arbitration in accordance with clause 38.4 ("Appointment of
          arbitration tribunal").

     (d)  Where the dispute is a Billing Dispute, the Parent concerned may at
          any time if it is not satisfied with the progress being made on
          addressing the issues raised by the dispute, elect by notice to the
          other parties to the dispute including the other Parent to refer the
          matter directly for resolution in the manner provided in clause 38.3.

38.3 Compulsory final and binding Arbitration

     (a)  Subject to the provisions of this agreement, a dispute will be
          referred to and finally resolved by binding arbitration under the
          Rules of the London Court of International Arbitration (the "LCIA"),
          as varied herein, which Rules are deemed to be incorporated by
          reference into this clause, by notice in writing ("Arbitration
          Notice") given by any party to this agreement at any time after that
          party becomes permitted to do so under clause 38.2 ("Notice of
          Dispute").

     (b)  The arbitration proceedings will be taken to have commenced when a
          party gives the Arbitration Notice.

     (c)  The parties to a Dispute may agree to resolve the Dispute in a manner
          other than by arbitration in which case the Dispute is to be resolved
          in accordance with that agreement.

38.4 Appointment of arbitration tribunal

     (a)  The number of arbitrators will be three unless the parties otherwise
          agree.

                                                                              41

<PAGE>

     (b)  The parties will jointly appoint the arbitrators within twenty one
          days of the commencement of the arbitration proceedings. The
          arbitrators so appointed must (unless the parties agree otherwise) be
          (i) a chartered accountant of at least ten years experience or (ii) a
          lawyer of at least ten years experience; or (iii) a person with a
          minimum of ten years technical experience within the
          telecommunications industry. Within fourteen days of an appointment
          under this sub clause the claimant will make its written request for
          arbitration to the LCIA identifying the arbitrators selected by the
          parties.

     (c)  If the parties cannot agree on the appointment of arbitrators the
          claimant will make its written request for arbitration within twenty
          eight days of the commencement of the arbitration proceedings. The
          claimant shall provide to the LCIA the name and contact details of
          its nominee arbitrator in its written request for arbitration, and
          the respondent shall provide to the LCIA the name and contact details
          of its nominee arbitrator within five working days of its receipt of
          the claimant's written request for arbitration. The LCIA Court shall
          nominate the chairman, taking into account the criteria in sub-clause
          (b), and appoint the tribunal within five working days of its receipt
          of the claimant's written request for arbitration or as soon as
          possible thereafter.

38.5 Conduct of arbitration

     (a)  Unless the parties otherwise agree, the arbitration is to be
          conducted in London.

     (b)  The language to be used in the arbitration proceedings shall be
          English.

38.6 Arbitrator's award

     The parties agree to request the arbitration tribunal to make its final
     award within three months after the request for arbitration. The
     arbitrators agree that the arbitrators may (where necessary varying the
     LCIA rules) determine the periods of time in which Notices, communications
     and other documents are to be served or delivered and actions are to be
     taken by the parties in order to give effect to this clause.

     A party may not commence legal proceedings in any court (except
     proceedings seeking urgent interlocutory relief) or request any Regulator
     to intervene, mediate, arbitrate or make orders in respect of a dispute in
     connection with or arising from this agreement until the arbitration
     tribunal makes its final award.

     Each party must continue to fulfil its obligations under this agreement
     during the pendency of a dispute and any dispute resolution process
     involved under this clause 38 ("Dispute Resolution").

     A party must not use information obtained in the course of any procedure
     established by this clause 38 ("Dispute Resolution") for any purpose other
     than to resolve the relevant dispute.

                                                                              42

<PAGE>

38.7 Election rights

     This clause is subject to the rights of a party to make an election under
     clause 37.1.

--------------------------------------------------------------------------------
39   Miscellaneous

39.1 Representations and Warranties

     (a)  Each party represents and warrants that:

          (i)  it is duly incorporated and in existence under the laws of the
               place set out in the Details as its place of incorporation;

          (ii) it has power to enter into and observe its obligations under
               this agreement; and

         (iii) it has in full force and effect the authorisations necessary to
               enter into this agreement, observe obligations under it and
               allow it to be enforced; and

          (iv) its obligations under this agreement are valid and binding.

     (b)  Each party will indemnify the other party on demand for any
          liability, loss, damage or cost or expense (including legal fees on a
          full indemnity basis) incurred or suffered by that other party which
          arises out of or in connection with any breach of any of the
          representations and warranties given by the first party in clause
          39.1(a) ("Representations and Warranties").

39.2 Severance

     (a)  Subject to clause 39.2(b) ("Severance"), if a provision of this
          agreement is void, voidable by a party, unenforceable or illegal, but
          would not be void, voidable, unenforceable or illegal if it were read
          down and it is capable of being read down, it is to be read down to
          that extent.

     (b)  If a provision of this agreement is not able to be read down or is
          still void, voidable, unenforceable or illegal after being read down
          under clause 39.2(a) ("Severance"):

          (i)  if the provision would not be void, voidable, unenforceable or
               illegal if words were omitted, those words are hereby severed;
               and

          (ii) in any other case, the whole provision is hereby severed

          and the remainder of this agreement has full force and effect.

39.3 Governing law and jurisdiction

     (a)  This agreement and the transactions contemplated by this agreement
          are governed by the law in force in England.

                                                                              43

<PAGE>

     (b)  Each party irrevocably and unconditionally submits to the
          non-exclusive jurisdiction of the courts of England and courts of
          appeal from them for determining any dispute concerning this
          agreement or the transactions contemplated by this agreement. Each
          party waives any right it has to object to an action being brought in
          those courts, to claim that the action has been brought in an
          inconvenient forum, or to claim that those courts do not have
          jurisdiction.

     (c)  Without preventing any other mode of service, any document in an
          action (including, but not limited to, any writ of summons or other
          originating process or any third or other party notice) may be served
          on any party by being delivered to or left for that party at its
          address for service of notices under clause 39.11 ("Notices").

     (d)  Each party appoints the person referred to below as its process agent
          to receive on its behalf service of process in any proceedings in
          England:

          Reach Parent, Reach and RNHK

          Reach Europe Limited
          50-52 Paul Street
          London EC2A 4LB
          ENGLAND

          Telstra and CSL

          Telstra Europe Limited

          Telstra Europe Limited
          Telstra House,
          21 Tabernacle Street,
          London EC2A 4DE
          ENGLAND PCCW, PCCW Capacity Holder and
          PCCW-HKT

          Simmlaw Services Limited
          Citypoint
          I Ropemaker Street
          London EC2Y 9SS

     (e)  Service upon the process agent shall be good service upon the party
          whether or not it is forwarded to and received by the party provided
          that a copy provided that a copy of those documents must also be
          provided to:

          (i)  in the case of Telstra and CSL:

                   Company Secretary
                   Telstra Corporation Limited
                   Level 41
                   242 Exhibition Street
                   Melbourne  Victoria, 3000
                   Australia; and

          (ii) in the case of PCCW or PCCW Singapore, to:

                                                                              44

<PAGE>

                   The Company Secretary
                   PCCW Limited
                   39th Floor, PCCW Tower
                   TaiKoo Place
                   979 King's Road, Quarry Bay
                   Hong Kong

         (iii) in the case of Reach Parent, Reach or RNHK, to:

                   The Company Secretary
                   Reach Global Services Limited
                   20th Floor, Telecom House,
                   3 Gloucester Road,
                   Wanchai,
                   Hong Kong

     (f)  If for any reason the process agent ceases to be able to act as
          process agent, or no longer has an address in England, the party
          irrevocably agrees to appoint a substitute process agent with an
          address in England acceptable to the other parties and to deliver to
          the other parties a copy of the substitute process agent's acceptance
          of that appointment within 20 Business Days. In the event that the
          party fails to appoint a substitute process agent, it shall be
          effective service for another party to serve the process upon the
          last known address in England of the last known process agent
          notified to the serving party, notwithstanding that such process
          agent is no longer found at such address or has ceased to act:

39.4 Entire agreement

     This agreement and the other Transaction Documents constitutes the entire
     agreement of the parties about their respective subject matters and any
     previous agreements, understandings and negotiations on those subject
     matters cease to have any effect. Each party acknowledges that in entering
     into this agreement, it has not relied on any representations or
     warranties about its subject matter except as provided in this agreement
     and is not liable to the other party in equity, contract or tort under the
     Misrepresentation Act 1967 (UK) for a representation not set out in this
     agreement or any document referred to in this agreement.

39.5 Variation

     Except as expressly provided for in this agreement, no variation of this
     agreement shall be effective unless:

     (a)  the variation is specifically provided for elsewhere in this
          agreement; or

     (b)  the variation is in writing and executed by the parties; or

     (c)  the variation is one which is contemplated and provided for in clause
          5 ("Variation of Telecommunications Services").

                                                                              45

<PAGE>

39.6 Assignment

     No party may assign or transfer any of its rights or obligations under
     this agreement without the prior consent of the other parties.

39.7 Waiver

     The waiver of any breach of, or failure to enforce, any term or condition
     of this agreement shall not be construed as a waiver or a waiver of any
     other breach of this agreement. No waiver shall be valid unless it is in
     writing and signed by an authorised officer on behalf of the party
     granting the waiver.

39.8 Relationship of parties

     The relationship of the parties to this agreement is one of independent
     contractors only. Nothing in this agreement is to be construed as creating
     an agency, partnership, association, trust or joint venture between the
     parties.

39.9 Relationships with Third Persons

     (a)  Neither a party nor any of its employees, agents, representatives or
          contractors is to be deemed an employee, agent, contractor or
          representative of the other party.

     (b)  No party has any authority to bind or oblige or incur any liability
          on behalf of the other party and no such authority is to be implied.

     (c)  A person who is not a party has no right to enforce any term of this
          agreement.

39.10 Approvals and Consents

     A party may give conditionally or unconditionally or withhold its approval
     or consent in its absolute discretion unless this agreement expressly
     provides otherwise.

     A party may exercise a right, power or remedy at its discretion, and
     separately or concurrently with another right, power or remedy. A single
     or partial exercise of a right, power or remedy by a party does not
     prevent a further exercise of that or of any other right, power or remedy.
     Failure by a party to exercise, or delay by a party in exercising, a
     right, power or remedy does not prevent its exercise.

39.11 Notices

     (a)  Unless expressly stated otherwise in this agreement, all notices,
          certificates, consents, approvals, waivers and other communications
          in connection with this agreement must be in writing signed by an
          Authorised Officer and must be marked for the attention of the person
          identified in the Details or, if the recipient has notified
          otherwise, then marked for attention in the last way notified.

     (b)  Notices must be:

          (i)  left at the address set out or referred to in the Details;

                                                                              46

<PAGE>

          (ii) sent by prepaid ordinary post (airmail if appropriate) to the
               address set out or referred to in the Details;

         (iii) sent by fax to the fax number set out or referred to in the
               Details; or

          (iv) given in any other way permitted by law.

          However, if the intended recipient has notified a changed address or
          fax number, then the communication must be to that address or number.

     (c)  They take effect from the time they are received unless a later time
          is specified.

     (d)  If sent by post, they are taken to have been received three days
          after posting (or seven days after posting if posted from the
          sender's country to another country).

     (e)  If sent by fax, they are taken to have been received at the time
          shown in the transmission report as the time that the whole fax was
          sent.

     (f)  Despite clauses 39.11(d) and (e), if they are received after 5.00pm
          in the place of receipt or on a non-business day, they are taken to
          be received at 9.00am on the next business day.

39.12 Counterparts

     This agreement may consist of a number of counterparts and the
     counterparts taken together constitute one and the same instrument.

--------------------------------------------------------------------------------
40   Structure and interpretation

40.1 Structure

     This agreement consists of

     (a)  the Main Body;

     (b)  Annexures A to J;

     (c)  a Service Schedule for each Other Outsourcing Service and each
          Telecommunications Service; and

     (d)  a Performance Requirements and Cost Information Schedule for each
          Telecommunications Service.

40.2 Annexures E to G

     Annexures E to G detail procedures and terms and conditions which apply
     generally to the supply of all the provision of Telecommunications
     Services in the particular areas of:

     (a)  costing information and billing and settlement (Annexure E ("Billing
          and Settlement"));

                                                                              47

<PAGE>

     (b)  ordering and provisioning (Annexure F ("Forecasting, Ordering and
          Provisioning); and

     (c)  operations and maintenance (Annexure G ("Operations and
          Maintenance")).

40.3 Annexure A ("Definitions")

     Annexure A ("Definitions") contains a list of defined terms used in this
     agreement.

40.4 Annexure J

     Annexure J contains the list of Telecommunications Services to be provided
     by Reach to each Parent Group.

40.5 Service Schedules

     Each Service Schedule:

     (a)  contains a service description for a particular Telecommunications
          Service or other Outsourcing Service (which description may refer to
          a Specification for that Service); and

     (b)  may contain additional terms and conditions applicable to that
          Service.

40.6 Performance Requirements and Cost Information Schedule

     Each Performance Requirements and Cost Information Schedule sets out the
     format in which costs are to be itemised for the Telecommunications
     Services and Performance Requirements for the Telecommunications Services.

40.7 Inconsistency

     In the event of inconsistency between any of the Main Body, the Annexures,
     the Service Schedules and the Performance Requirements and Cost
     Information Schedules, then the order of precedence to the extent of any
     inconsistency (unless expressly stated otherwise) will be as follows:

     (a)  the Main Body, Annexures A ("Definitions"), B ("Outsourcing
          Services"), C ("Quarterly Outsourcing Fee"), E ("Billing and
          Settlement"), H ("Return Rates") and I ("Mark-up Table"),

     (b)  then Annexure J; then

     (c)  the Service Schedules; then

     (d)  Annexures F ("Forecasting, Ordering and Provisioning) and G
          ("Operations and Maintenance"); then

     (e)  the Performance Requirements and Cost Information Schedules.

40.8 Interpretation

     In this agreement, except if the context requires otherwise:

                                                                              48

<PAGE>

     (a)  words and expressions have the meanings set out in Annexure A
          ("Definitions"); and

     (b)  words and expressions in relation to a particular Service or a Charge
          for a particular Service, have the meanings set out in the Service
          Schedule and Performance Requirements and Cost Information Schedule
          for that Service.

     (c)  words and expressions in relation to a particular Service have the
          meanings set out in the Service Schedule for that Service; and

     (d)  the singular includes the plural and vice versa; and

     (e)  a reference to an agreement, document or another instrument includes
          any variation or replacement of any of them; and

     (f)  a reference to this agreement includes a reference to an Annexure,
          Service Schedule and Performance Requirements and Cost Information
          Schedule; and

     (g)  an agreement, representation or warranty in favour of two or more
          persons is for the benefit of them jointly and each of them
          individually;

     (h)  an agreement, representation or warranty by two or more persons binds
          them individually only;

     (i)  a reference to a clause is a reference to a clause of the Main Body
          or an Annexure and a reference to a paragraph is a reference to a
          paragraph in a Service Schedule or Performance Requirements and Cost
          Information Schedule; and

     (j)  a reference to a statute, ordinance, code or other law includes
          regulations and other instruments under it and consolidations,
          amendments, re-enactments or replacements of any of them; and

     (k)  the word person includes a firm, body corporate, unincorporated
          association or an authority; and

     (l)  a reference to a person includes the person's executors,
          administrators, successors, substitutes (including, without
          limitation, persons taking by novation), and permitted assigns; and

     (m)  a reference to a period of time:

          (i)  which dates from a given day or the day of an act or event is to
               be calculated exclusive of that day; or

          (ii) which commences on a given day or the day of an act or event is
               to be calculated inclusive of that day; and

     (n)  a reference to a month is a reference to a calendar month and a
          reference to a year is a calendar year; and

                                                                              49

<PAGE>

     (o)  if the day on which the payment of money falls due is not a Business
          Day, the due date is deemed to be the next Business Day; and

     (p)  a reference to a third person or a third party is a reference to a
          person who is not a party to this agreement; and

     (q)  except in a context where it means the Calling Party or the Called
          Party in relation to a Call, a reference to a party is a reference to
          a party to this agreement; and

     (r)  the paraphrasing of any statutory provisions in this agreement does
          not amount to either party agreeing to waive any of its rights under
          the paraphrased provisions and those statutory provisions continue to
          apply in full;

     (s)  references to paid, paid in full or payment means that the funds paid
          or included in that payment are available for immediate use by the
          payee;

     (t)  PCCW-HKT is only entering this agreement for the purposes of clauses
          2.2 and 2.3 and shall have no liability, or be considered a party,
          under this agreement for any other purpose.

     (u)  PCCW Capacity Holder is only entering this agreement for the purposes
          of clauses 4.3 and 37.2(d) and (e) and shall have no liability, or be
          considered a party, under this agreement for any other purpose.

     (v)  CSL is only entering this agreement for the purposes of clauses 2.2
          and 2.3 and shall have no liability, or be considered a party, under
          this agreement for any other purpose.

40.9 Headings

     Headings and bold type are included for convenience and do not affect the
     interpretation of this agreement.

EXECUTED as an agreement

                                                                              50

<PAGE>

Signing page

DATED: 16 October 2005

SIGNED by                        )
as attorney for REACH LTD. in    )
the presence of:                 )
                                 )
                                 )
------------------------------   )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
------------------------------   )   the attorney states that the
Name of witness (block letters)  )   attorney has received no
                                 )   notice of revocation of the
                                 )   power of attorney

SIGNED by                        )
as attorney for REACH GLOBAL     )
SERVICES LIMITED in the          )
presence of:                     )
                                 )
                                 )
------------------------------   )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
------------------------------   )   the attorney states that the
Name of witness (block letters)  )   attorney has received no
                                 )   notice of revocation of the
                                     power of attorney

SIGNED by                        )
as attorney for REACH NETWORKS   )
HONG KONG LIMITED in the         )
presence of:                     )
                                 )
                                 )
------------------------------   )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
------------------------------   )   the attorney states that the
Name of witness (block letters)  )   attorney has received no
                                 )   notice of revocation of the
                                     power of attorney

                                                                              51

<PAGE>

SIGNED by Simon James Brookes    )
as attorney for TELSTRA          )
CORPORATION LIMITED under power  )
of attorney dated 13 April 2005  )
in the presence of:              )
                                 )
                                 )
------------------------------   )   ------------------------------
Signature of witness             )   By executing this agreement
                                 )   the attorney states that the
------------------------------   )   attorney has received no
Name of witness (block letters)  )   notice of revocation of the
                                 )   power of attorney

SIGNED by Simon James Brookes    )
as authorised representative     )
for HONG KONG CSL LIMITED:       )
                                 )
                                 )
-------------------------------  )
Signature of witness             )
                                 )   ------------------------------
-------------------------------  )   By executing this agreement
Name of witness (block letters)  )   the signatory warrants that
                                 )   the signatory is duly
                                 )   authorised to execute this
                                 )   agreement on behalf of HONG
                                     KONG CSL LIMITED

SIGNED by                        )
as authorised representative     )
for PCCW LIMITED in the          )
presence of:                     )
                                 )
                                 )
-------------------------------  )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
-------------------------------  )   the signatory warrants that
Name of witness (block letters)  )   the signatory is duly
                                 )   authorised to execute this
                                     agreement on behalf of PCCW
                                     LIMITED

                                                                              52

<PAGE>

SIGNED by                        )
as authorised representative     )
for PCCW COMMUNICATIONS          )
(SINGAPORE) PTE LTD in the       )
presence of:                     )
                                 )
                                 )
-------------------------------  )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
-------------------------------  )   the signatory warrants that
Name of witness (block letters)  )   the signatory is duly
                                     authorised to execute this
                                     agreement on behalf of PCCW
                                     COMMUNICATIONS (SINGAPORE) PTE
                                     LTD

SIGNED by                        )
as authorised representative     )
for PCCW -HKT TELEPHONE LIMITED  )
in the presence of:              )
                                 )
                                 )
-------------------------------  )
Signature of witness             )   ------------------------------
                                 )   By executing this agreement
-------------------------------  )   the signatory warrants that
Name of witness (block letters)  )   the signatory is duly
                                 )   authorised to execute this
                                     agreement on behalf of PCCW
                                     -HKT TELEPHONE LIMITED

                                                                              53

<PAGE>

Annexure A (Definitions)

--------------------------------------------------------------------------------
1    Definitions

     Acquired Capacity for a Parent means capacity acquired by the Parent or a
     Related Body Corporate of the Parent which becomes part of the Parent's
     Capacity under clause 13 ("Additional Capacity").

     Acquired Capacity Integration and Management means the Outsourcing service
     specified in the corresponding Service Schedule.

     Addendum means, in relation to a particular Telecommunications Service,
     any addendum to Annexes E ("Billing and Settlement"), F ("Forecasting,
     Ordering and Provisioning") and G (Operations and Maintenance") contained
     in a Service Schedule which contains additional procedures applicable to
     that Telecommunications Service.

     Allocated Capacity for a Parent means Reach Capacity allocated to in the
     case of Telstra, Telstra and in the case of PCCW, the PCCW Capacity Holder
     under the Capacity Allocation Agreement.

     AJC Indemnity Agreement means the Australia Japan Cable Indemnity
     Agreement dated 15 April 2003 between Telstra and Reach.

     Annexure means an Annexure to this agreement.

     AOP means the Reach Annual Operating Plan of Reach Parent for each Year
     which is approved from time to time in accordance with clause 7.13 of the
     Shareholders Agreement.

     Authorised Officer means a person appointed by a party to act as an
     Authorised Officer for the purposes of this agreement.

     Bilateral Arrangements is defined in clause 7.2 of the Main Body.

     Billing Dispute means a dispute of the nature referred to in clause 1.5(d)
     of Annexure F ("Forecasting, Ordering and Provisioning").

     Billing and Settlement Procedures means the procedures specified in
     Annexure E ("Billing and Settlement").

     BSM means Reach's Billing and Settlement Manual.

     Business Day means a day other than a Saturday, Sunday or public holiday
     in Hong Kong.

     Cable Capex means Capex relating to the acquisition, construction,
     installation, commissioning or upgrade of Capacity on a cable system

     Call means a Voice Service carried by a Network and, where the context
     permits, includes an attempt to establish a Communication.

     Capacity means the amount of carriage that can be conducted simultaneously
     on a telecommunications facility.

                                                                              54

<PAGE>

     Capacity Allocation Agreement means the agreement of that name between
     RGNL, Telstra, the PCCW Capacity Holder and PCCW dated on or about the
     date of this agreement.

     Capacity Holder means Telstra or the PCCW Capacity Holder.

     Capex means capital expenditure.

     Carrier means a person who is the holder of a carrier licence.

     Charges means the Quarterly Outsourcing Fees and other amount payable to
     Reach under this agreement on account of the Outsourcing Services.

     Claim includes any allegation, debt, cause of action, Liability, claim,
     proceeding, suit or demand of any nature howsoever arising and whether
     present or future, fixed or unascertained, actual or contingent, whether
     at law, in equity, under statute or otherwise.

     CLI or Calling Line Identification means information generated by the
     Network capability which identifies and forwards through one party's
     Network to the other party's Network the calling number or End User
     number.

     Commencement Date means 1 March 2005.

     Committed Third Party Data Contract means a contract under which Committed
     Third Party Data Services are provided.

     Committed Third Party Capacity means the Capacity which is currently being
     used by Reach to provide the Committed Third Party Data Services.

     Committed Third Party Customers means customers under Committed Third
     Party Data Contract

     Committed Third Party Data Services means the data telecommunication
     services provided by Reach or any of its Related Bodies Corporate to third
     parties (excluding any Third Party Network Interconnect Services) which
     Reach or any of its Related Bodies Corporate have a legal obligation to
     continue to provide for a period.

     Communication includes any communication:

     (a)  whether between persons and persons, things and things, or persons
          and things; and

     (b)  whether in the form of speech, music or other sounds, data, text,
          visual images, signals or any other form or in any combination of
          forms,

     and, where the context permits, includes an attempt to establish a
     Communication.

     Confidential Information of a party means all information, know-how,
     ideas, concepts, technology, manufacturing processes, industrial,
     marketing and commercial knowledge of a confidential nature (whether in
     tangible or

                                                                              55

<PAGE>

     intangible form) relating to the business of that party which is
     disclosed, communicated or delivered by it to another party pursuant to
     this agreement, or is learnt or comes into the possession of the another
     party in connection with this agreement, but does not include any such
     information which:

     (a)  is or becomes part of the public domain (other than through any
          breach of this agreement or breach of an obligation of confidence
          owed to a third party); or

     (b)  is rightfully received by a party from a third person without a duty
          of confidentiality being owed by the party to the third person,
          except where the party has knowledge or should reasonably have known:

          (i)  that the third person has obtained that information either
               directly or indirectly as a result of a breach of any duty of
               confidence owed to the first mentioned party; or

          (ii) disclosure of the information to that party by the third person
               is a breach of a duty of confidence owed to the first party; or

     (c)  has been independently developed by the party.

     Conversation Minute means the derived period of time (expressed in minutes
     and calculated and chargeable in multiples of one second or part thereof)
     from the receipt of an answer signal until receipt of a "clear forward" or
     "forced release signal" in each case by Reach at the international gateway
     exchange.

     Correspondent means an international telecommunications operator to whom a
     party's international network (or the network operated by that party) is
     directly connected and from whom traffic is sourced and/or to whom
     international traffic is provided.

     Cost or Cost Information means costs for a Telecommunications Service
     which are required to be provided by Reach as set out in a Cost Statement.

     Cost Statement for a Telecommunications Service means a statement
     containing the information specified in the Performance Requirements and
     Cost Information Schedule for that service.

     Costing Information Dispute means a claim by a Parent that some or all of
     the cost information included in a Cost Statement is incorrect.

     Costing Information Procedures means the procedures specified in Annexure
     E ("Billing and Settlement").

     Costing Period means a period of one month.

     CSL WISA means the Wireless International Services Agreement between RNHK
     and CSL.

     DAAs means the Domestic Access Agreement entered into by Reach with
     Telstra, the Domestic Connectivity Agreement entered into by RNHK with
     HKT-PCCW and the Wireless Domestic Access Agreement entered into by CSL
     and RNHK.

                                                                              56

<PAGE>

     Data Fee means the data fee payable by a Parent under paragraph 1.1 of
     Annexure C ("Outsourcing Fee").

     Default Notice means a notice issued under clause 34 of the Main Body.

     Delivery Date means the agreed date on which a given Telecommunications
     Service will be delivered by Reach.

     Designated IP means any Intellectual Property the use of which is an
     integral but subsidiary part of the supply of a Service.

     Details means the section of the Main Body headed "Details".

     Development is defined in clause 15.2 ("Parent Funded Development").

     Dispute Resolution Procedure means the procedure set out in clause 38
     ("Dispute Resolution").

     Effective Date has the meaning given to it in the Reach Debt and Asset
     Restructure Deed.

     Emergency means an emergency due to an actual or potential occurrence
     (such as fire, flood, storm, earthquake, explosion, accident, epidemic or
     war like action) which:

     (a)  endangers or threatens to endanger the safety or health of persons;
          or

     (b)  destroys or damages, or threatens to destroy or damage property,

     being an emergency which requires a significant and co-ordinated response.

     End Customer means a person who contracts or agrees with a supplier to
     acquire a carriage service or content service from that supplier.

     End Customer Capacity Integration and Management means the Outsourcing
     Service described in the corresponding Service Schedule by that name.

     Estimated Monthly Fee is defined in clause 9.1(a) ("Payment of monthly
     amount").

     Exchange means telephone switching equipment of Reach ,Telstra or PCCW.

     Existing Allocated Capacity means the Capacity which is allocated to a
     Telstra under clauses 1.1(a) and (b) ("Allocation to Telstra") of the
     Capacity Allocation Agreement and to the PCCW Capacity Holder under
     clauses 2.1(a) and (b) ("Allocation to PCCW") of the Capacity Allocation
     Agreement and includes in each case any further Capacity which is
     allocated to Telstra or the PCCW Capacity Holder in accordance with clause
     10.7 of the Capacity Allocation Agreement.

     External Restoration Capacity is defined in clause 16.1(a) ("External
     Restoration").

                                                                              57

<PAGE>

     Fault means a disruption or interruption in the delivery of a
     Telecommunications Service or in the normal operation of a Network.

     Force Majeure means any cause which is not reasonably within the control
     of the party affected including, but not limited to, act of God,
     industrial disputes of any kind, war declared or undeclared, blockade,
     disturbance, lightning, fire, earthquake, storm, flood, explosion or
     meteor, governmental restraint, expropriation or prohibition (including
     unavailability or delay in availability of software, equipment or
     transport, inability or delay in granting or obtaining governmental
     approvals (other than in respect of external financing), consents,
     permits, licences or authorities where, in respect of all such events, the
     cause is not reasonably within the control of the party affected.

     Forecast means a Parent's best estimate of the level of its Group's
     requirements for a Telecommunications Service.

     Free Upgrade Capacity means additional Capacity which is allocated to a
     Capacity Holder under clause 12.3 ("Free capacity upgrades") of the
     Capacity Allocation Agreement.

     Funded Capex means Overhead Capex and Parent Funded Capex.

     Further Reach Capacity is defined in the Capacity Allocation Agreement.

     Group is defined in clause 3.4 of the Main Body.

     Holding Company of a body corporate ("first body") means a body corporate
     of which the first body is a Subsidiary.

     Hong Kong PoP means RNHK, Reach Cable Networks Limited and their
     successors.

     Hong Kong PoP Recovery Fee means the fee charged by a Hong Kong PoP to
     Reach for services, which shall be determined as the Hong Kong PoP costs
     marked up at the Mark up Rate in accordance with the Mark up Table plus
     the return on assets determined by applying the Return on Assets Rate to
     the monthly average net book value of assets owned by the Hong Kong PoP.

     Intellectual Property means all rights conferred under statute, common law
     and equity in and in relation to trade marks, trade names, logos and get
     up, inventions, patents, designs, copyright, circuit layouts, confidential
     information, know-how and trade secrets and all rights and interests in
     them or licences to use any of them.

     Interconnect Capacity means the capacity provided as Switchports between
     Reach's Interconnect Gateway Exchange and a POI for use in the provision
     of a Telecommunications Service.

     Interconnect Gateway Exchange means an Exchange nominated by Reach for
     provision of interconnection of Reach's Network with that of a member of a
     Group receiving Telecommunications Services.

     Interest Rate means the Default Rate as defined in the Shareholder Term
     Loan Facility Agreement.

                                                                              58

<PAGE>

     Internal Restoration Capacity is defined in clause 16.2 ("Internal
     Restoration").

     International POI means a POI which is used for a telephony Service and
     which is connected only to the international side of Reach's international
     gateway Exchanges.

     Invoice means the demand for payment of Charges; an Invoice may include
     Charges, credits and previous invoice information.

     IP Owner means the party which is the owner or licensee of Designated IP.

     IP User in relation to Designated IP means the party which is not the IP
     Owner.

     IRU is defined under the Capacity Allocation Agreement.

     ISAs means the PCCW ISA, the Telstra ISA and the CSL WISA.

     ISA Services means telecommunications services provided under an ISA.

     A body corporate is Insolvent if:

     (a)  an order is made or an effective resolution has been passed for it to
          be wound up, or dissolved without winding-up (otherwise than for the
          purposes of reconstruction or amalgamation);

     (b)  a receiver, receiver manager, judicial manager, liquidator,
          provisional liquidator, official manager, administrator, trustee or
          like official has been appointed over the whole or any material part
          of its undertaking or property;

     (c)  any distress, execution, sequestration or other similar process has
          been levied or enforced upon or sued out against the whole or any
          material part of its property and has remained undischarged for a
          continuous period of more than 30 days;

     (d)  it has made an assignment for the benefit of creditors (including a
          class of creditors) generally;

     (e)  it is subject to any arrangement, assignment, moratorium or
          composition, protected from creditors under any statute or dissolved
          (in each case, other than to carry out a reconstruction or
          amalgamation while solvent on terms approved in writing by the
          Parents);

     (f)  it is unable or admits inability to pay its debts as they fall due,
          suspends making payments on any of its debts or, by reason of actual
          or anticipated financial difficulties, commences negotiations with
          its creditors generally to reschedule any or all of its indebtedness;
          or

     (g)  a situation substantially analogous to any of (a) to (f) exists in
          connection with the body corporate under the law of any jurisdiction.

     Landing Station means a facility for landing an international cable
     system.

                                                                              59

<PAGE>

     Landing Segment Capacity means that part of any Capacity on an
     international cable system on the international side of an applicable
     Landing Station and which is not in International Waters (as defined in
     the Capacity Allocation Agreement).

     Legislative Event means:

     (a)  the enactment, amendment, replacement or repeal of the
          Telecommunications Act, the TPA or other telecommunications related
          legislation or subordinate legislation in Australia or another
          country connected with this agreement;

     (b)  the registration, making, promulgation, issue, amendment or
          replacement of any code with which either or both of the parties is
          bound, required or obliged to comply; or

     (c)  the making of a determination or finding by a Regulator or a court of
          law that all or any part of this agreement contravenes any provision
          of any law, except to the extent that the making of such
          determination or finding constitutes a Regulatory Event; or

     (d)  the determination, addition, variation or removal of a Service
          Provider Rule (as defined in section 98 of the Telecommunications
          Act) applicable to a party.

     Local Reach PoP Recovery Fee means the amount earned by a Local Reach PoP
     in accordance with its services agreement with Reach plus any taxes
     thereon other than tax on net income, excluding any return on assets or
     depreciation recapture related to assets over which RGNL has issued an IRU
     under the Capacity Allocation Agreement.

     Local Reach PoP means a member of the Reach Group providing services to
     the Reach Group.

     Loss means all damage, loss, cost and expense (including legal costs and
     expenses of whatsoever nature or description).

     Main Body means the provisions of this agreement excluding the Annexes and
     Service Schedules.

     Major Route means a destination which makes up one of the top 15
     destinations for any voice traffic for a Parent's Group as measured by
     volume of minutes.

     Mark-up Rate means the rate specified in Annexure H ("Return Rates").

     Mark-up Table means the table contained in Annexure I ("Mark-up Table")
     specifying which Reach costs are to be marked up for the purpose of
     determining the Quarterly Outsourcing Fee.

     Material Breach means a material breach of this agreement by Reach.

     MIU Point is defined under the Capacity Allocation Agreement.

                                                                              60

<PAGE>

     Network (of a party) means the system, or series of systems, owned or
     operated by that party that carries, or is capable of carrying
     Communications by means of guided or unguided electromagnetic or optical
     energy.

     Network Conditioning means the conditioning, equipping, installing and/or
     commissioning of equipment, software and infrastructure in Reach's Network
     to enable the provision of the Telecommunications Services by Reach.

     Network Service means a Telecommunications Service provided by Reach under
     this agreement which is described in Reach's Service Schedule to be a
     Network Service.

     Non Cable Capex means Capex which is not Cable Capex.

     O&M Charges in relation to a cable system means costs incurred in relation
     to the operation and maintenance of the cable system but excludes any
     Capex.

     OMM means Reach's Operations and Maintenance Manual associated with
     Annexure G ("Operations and Maintenance").

     Operations and Maintenance Procedures means the procedures specified in
     Annexure G ("Operations and Maintenance").

     OPM means Reach's Ordering and Provisioning Manual associated with
     Annexure F ("Forecasting, Ordering and Provisioning").

     Order means an order for a Telecommunications Service under this
     agreement.

     Ordinance means the Telecommunications Ordinance (Cap 106).

     Other Outsourcing Services means the services set out in Item 2 of
     Annexure B ("Outsourcing Services") as described further in the relevant
     Service Schedules.

     Outsourcing Fee means the fee payable by each Parent to Reach for the
     Outsourcing Services.

     Outsourcing Services means the services set out in Annexure B
     ("Outsourcing Services").

     Outsourcing Services Forum or OSF means the body established under clause
     29.1 ("Establishment of OSF").

     Overhead Capex means any capex commitments of Reach which are:

     (a)  included in an AOP; or

     (b)  otherwise approved by the Board of Reach Parent (or any sub committee
          of the Board of Reach Parent to whom the right to give this approval
          has been delegated, currently the capital management sub committee of
          the Board),

     and which the Parents agree is to be Overhead Capex.

                                                                              61

<PAGE>

     Party means a party to this agreement and parties means any of them.

     Parent means PCCW or Telstra.

     Parent's Capacity means:

     (a)  Reach Capacity allocated to the Parent or in the case of PCCW, the
          PCCW Capacity Holder; and

     (b)  the Acquired Capacity of that Parent.

     Parent Funded Cable Capex means any capex commitments of Reach which is
     the Capacity Holders or either of them has agreed to fund under the
     Capacity Allocation Agreement.

     Parent Funded Capex means Parent Funded Cable Capex and Parent Funded Non
     Cable Capex.

     Parent Funded Non Cable Capex means any Capex other than Cable Capex which
     the Parents or either of them has agreed to fund.

     Parent Funded Development is defined in clause 15.2(b) ("Parent Funded
     Development").

     Parent Specific Charges means the charges payable by a Parent under
     paragraph 1.3 of Annexure C ("Outsourcing Fee").

     Parent's Group means the Parent and each Related Body Corporate of the
     Parent who may order Telecommunication Services pursuant to clause 3.4 of
     the Main Agreement.

     Parent's Systems and Equipment means the systems and equipment which Reach
     and the Parent may agree to be Parent's Systems and Equipment and will
     include any systems and equipment provided by a Parent pursuant to clause
     19.6.

     PCCW ISA means the International Services Agreement (Hong Kong) dated 13
     October 2000 between RNHK and PCCW-HKT as amended.

     PCCW PoP means an entity controlled by PCCW which is located in a country
     other than Australia and which acquires telecommunication services.

     People (of a party) means each of that party's directors, officers,
     employees, agents, contractors and representatives but, for the avoidance
     of doubt, does not include that party's End Customers or another party.

     Performance Requirements means, in relation to a Telecommunications
     Service, the performance requirements for that Telecommunications Service
     set out in the Performance Requirements and Cost Information Schedule for
     that Telecommunications Service.

     Performance Requirements and Cost Information Schedule means a schedule
     for a Telecommunications Service which sets out the Performance
     Requirements and Cost Information for that Telecommunications Service.

                                                                              62

<PAGE>

     POI means, in relation to a Parent, an agreed location which is a physical
     point of demarcation between Reach's Network and that Parent's Network.

     Privacy Laws means any laws, regulations, codes, or policies applicable to
     or protecting the privacy of individuals and their personal information,
     including but not limited to, Parts 13 and 14 of the Telecommunications
     Act, the Privacy Act 1998 (Australia) and any privacy codes registered
     under Division 4 of Part 6 of the Telecommunications Act and equivalent
     legislation in the Hong Kong SAR.

     Prohibited Traffic means traffic offered across a POI for which there is
     no agreement between Reach and a Parent that Reach will carry this traffic
     or provide a related service to the Parent and members of its Group.

     Quarter means the period from the Commencement Date to 30 June 2005 and
     each other subsequent 3 calendar month period commencing on 1 July, 1
     October, 1 January and 1 April during the Term.

     Quarterly Adjustment is defined in clause 9.2 ("Quarterly Adjustment").

     Quarterly Outsourcing Fee is defined in clause 8.1 ("Quarterly Outsourcing
     Fee").

     Reach Capacity means the following Capacity:

     (a)  Existing Allocated Capacity;

     (b)  Free Upgrade Capacity;

     (c)  Further Reach Capacity.

     Reach Debt and Asset Restructure Deed means the deed by that name dated on
     or about the date of this agreement between Reach Parent and certain of
     its Subsidiaries, PCCW and certain of its Subsidiaries and Telstra and
     certain of its Subsidiaries .

     Reach Equipment means the equipment used by the Reach Group to provide the
     Outsourcing Services.

     Reach Group means Reach and each Related Body Corporate used by Reach to
     provide the Outsourcing Services.

     Reach Insolvency Event means Reach or any of its Related Bodies Corporate
     being Insolvent.

     Reach ROA Assets is defined in clause 1.4(d) of Annexure C ("Outsourcing
     Fee").

     Reach Systems means the systems used by the Reach Group to provide
     Outsourcing Services under this agreement.

     Recovery Fee means the data fee payable by a Parent under paragraph 1.4 of
     Annexure C ("Outsourcing Fee").

                                                                              63

<PAGE>

     Regulator means any authority or agency whether in Australia, the Hong
     Kong SAR or another country, sharing lawful authority over the subject
     matter of this agreement including, the avoidance of doubt, the Australian
     Competition and Consumer Commission and the HongKong Telecommunications
     Authority ("TA").

     Regulatory Event means the occurrence of:

     (a)  legal or regulatory restrictions;

     (b)  restrictions due to domestic or foreign government policy; or

     (c)  other restrictions imposed on telecommunication operators in relation
          to providing telecommunication services (including licensing
          requirements and restrictions relating to reselling services),

     which operate such that this agreement or any action taken or required to
     be taken in accordance with this agreement, including the provision of the
     Telecommunication Services, contravenes or may contravene any provision of
     any applicable law in force in the jurisdiction where the
     Telecommunication Services are being supplied or used.

     Related Body Corporate means a body corporate which is:

     (a)  a Holding Company of another body corporate; or

     (b)  a Subsidiary of another body corporate; or

     (c)  a Subsidiary of a Holding Company of another body corporate,

     but neither Telstra nor PCCW, nor their Subsidiaries, are Related Bodies
     Corporate of Reach.

     Return on Assets Rate means the rate specified in Annexure H ("Return
     Rates")

     RGNL means Reach Global Networks Limited.

     Service Manual means a manual developed by Reach setting out procedures
     and operational matters relating to Annexes E ("Billing and Settlement"),
     F ("Forecasting, Ordering and Provisioning") or G ("Operations and
     Maintenance").

     Service Schedule means a schedule to this agreement which, among other
     things, describes a Telecommunications Service or Other Outsourcing
     Service being supplied by Reach to the Parents and other members of their
     Groups.

     Shareholders Agreement means the IP Backbone Company Shareholders
     Agreement between Telstra, Telstra Holdings Pty Limited, Telstra Holdings
     (Bermuda) Pty Limited, PCCW, Pacific Century Cable Holdings Limited and
     Reach Parent, dated 13 October 2000, as amended.

     Shareholder Term Loan Facility Agreement means the agreement of that name
     between Reach Finance Limited, Reach Parent, RNHK, Reach Networks
     Australia Pty Limited, RGNL, Reach Global Services Limited,

                                                                              64

<PAGE>

     Reach International Holdings Limited, Reach Global Holdings Limited, Reach
     Networks KK, Telstra and PCCW dated 12 January 2001, as amended.

     Signalling Gateway means Reach's Interconnect Gateway Exchange where
     interconnection of signalling is provided and traffic circuits are
     provided.

     Signalling Terminal means equipment in a Signalling Gateway which provides
     CCS7 signalling.

     Specification means Reach's specification for a Telecommunications
     Service, which specification is referenced in the service description in
     Reach's Service Schedule for that Telecommunications Service.

     Subsidiary of a body corporate ("first body") means a body corporate
     ("other body"):

     (a)  in which the first body:

          (i)  controls the composition of the other body's board; or

          (ii) is in a position to cast, or control the casting of, more than
               one-half of the maximum number of votes that might be cast at a
               general meeting of the other body; or

         (iii) holds more than one-half of the issued share capital of the
               other body (excluding any part of that issued share capital that
               carries no right to participate beyond a specified amount in a
               distribution of either profits or capital); or

     (b)  which is a Subsidiary of a Subsidiary of the first body.

     Taxes means all duties (including, but not limited to, stamp duty), taxes
     (including, but not limited to, withholding tax) , levies, charges,
     imposts, or like charges.

     Telecommunication Services means the services listed in Annex J ("List of
     Telecommunications Services") and described in the Service Schedules.

     Telstra ISA means the International Services Agreement (Australia) dated
     13 October 2000 between Reach and Telstra as amended.

     Telstra PoP means an entity controlled by Telstra which is located in a
     country other than Australia and which acquires telecommunication
     services.

     Term means the term of the agreement.

     Third Party Network Interconnect Services means the network to network
     interconnection services that Reach matches with other carriers for the
     provision of international services.

     Transaction Documents has the meaning given to it in the Shareholder Term
     Loan Facility Agreement.

     Unauthorised Traffic is defined in clause 4.5 of the Main Body.

                                                                              65

<PAGE>

     Unfunded Capex is Capex which is not Funded Capex and is not:

     (a)  included in an AOP; or

     (b)  is otherwise approved by the Board of Reach Parent (or any sub
          committee of the Board of Reach Parent to whom the right to give this
          approval has been delegated, currently the capital management sub
          committee of the Board).

     Unfunded Development is Development which is not Parent Funded Development
     and is not:

     (a)  included in an AOP; or

     (b)  is otherwise approved by the Board of Reach Parent (or any sub
          committee of the Board of Reach Parent to whom the right to give this
          approval has been delegated, currently the finance monitoring sub
          committee of the Board).

     US$ and United Stated Dollars means the lawful currency of the United
     States of America.

     Voice Fee means the voice fee payable by a Parent under paragraph 1.2 of
     Annexure C ("Outsourcing Fee").

     Voice Management Principles means principles guiding the management of the
     settlement arrangements for Voice Charges and components of the Voice Fee
     as agreed among the parties from time to time through the voice working
     group of the OSF.

     Voice Services means the Telecommunications Services listed in Annexure J
     which are voice services.

     Working Group has the meaning given by clause 29.2 ("Workings of OSF") of
     the Main Body.

     Year means each of the following periods:

     (a)  from 1 March 2005 to 31 December 2005;

     (b)  each calendar year thereafter save for the Year in which the Term
          ends;

     (c)  for the Year in which the Term ends, from 1 January of that Year
          until the last day of the Term.

                                                                              66

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