Document:

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                                 EXHIBIT 10.2

                                   TERM NOTE

                                                       $7,000,000.00 May 5, 2000

     FOR VALUE RECEIVED, the undersigned, GORGES/QUIK-TO-FIX FOODS, INC. a
Delaware corporation (the "Borrower"), hereby promises to pay to the order of
THE CIT GROUP/BUSINESS CREDIT, INC. (the "Lender"), SEVEN MILLION AND NO/100
U.S. DOLLARS (U.S. $7,000,000.00), or so much thereof as may have been advanced
and is outstanding, on December 31, 2003.

     The Borrower promises to pay interest on the unpaid principal amount of the
Term Loan at a per annum interest rate equal to LIBOR plus 2.50%, with such rate
computed on a daily basis.  Accrued interest shall be payable in arrears on the
last day of each month.

     "LIBOR" shall mean the rate per annum determined on the basis of the
offered rate for deposits in U.S. dollars of amounts equal or comparable to the
principal amount of the Term Loan offered for one month, which rates appear on
the Reuters Screen LIBO Page effective as of 11:00 A.M., London time, provided
that (i) if more than one such offered rate appears on the Reuters Screen LIBO
Page, LIBOR will be the offered rate which is used in a majority of such
quotations, if there is a majority, otherwise the arithmetic average (rounded
upward, if necessary, to the next higher 1/100th of 1%) of such offered rates;
(ii) if no such offered rates appear on such page, LIBOR will be the arithmetic
average (rounded upward, if necessary, to the next higher 1/100th of 1%) of
rates quoted by the Chase Manhattan Bank at approximately 10:00 A.M., New York
City time for deposits in U.S. dollars offered by leading European banks for one
month in an amount comparable to the principal amount of the Term Loan.

     This Term Note may be secured by certain collateral of the Borrower, and
the documents evidencing such security interests shall be referred to as the
"Other Agreements".

     Upon (a) the failure to make any payment of principal or interest hereunder
when due, (b) any acceleration of the maturity of the indebtedness evidenced by
that certain Financing Agreement dated as of March 5, 1999, as amended, restated
or otherwise modified from time to time (the "Financing Agreement") by and among
the Lenders thereto, CIT/Business Credit, Inc., as Agent, and the Borrower, or
(c) payment in full of the indebtedness and other obligations owing under the
Financing Agreement, an Event of Default shall exist under this Note, and the
indebtedness evidenced by this Note shall become due and payable in full without
any notice to the Borrower.

     Time is of the essence under this Note.

     THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF GEORGIA.
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     IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
under seal as of the date first above written.

                               GORGES/QUIK-TO-FIX FOODS, INC.

                               By:_______________________________
                                 Title:

ATTEST:

By:__________________________
   Title:  Secretary

        (CORPORATE SEAL)COPY

                                  VIATEL, INC.,
                                    as Issuer

                                       and

                              THE BANK OF NEW YORK,
                                   as Trustee

                           Senior Euro Notes Indenture

                           Dated as of April 20, 2000

                       12 3/4 % Senior Euro Notes due 2008

<PAGE>

                              CROSS-REFERENCE TABLE

TIA SECTIONS      INDENTURE SECTIONS

ss. 310(a)(1).......7.10
       (a)(5).......7.10
       (b)..........7.03; 7.08
ss. 311.............7.03
ss. 313(a)..........7.06
       (c)..........7.05; 7.06
ss. 314(a)..........4.17
       (c)(1).......1.01
       (e)..........1.01
ss. 315(a)..........7.02
       (b)..........7.05
ss. 316(a)..........6.06

Note: The Cross-Reference Table shall not for any purpose be deemed to be a
      part of this Indenture.

<PAGE>

                               TABLE OF CONTENTS

                                                                            Page

      RECITALS OF THE COMPANY................................................1

                                  ARTICLE ONE
                   DEFINITIONS AND INCORPORATION BY REFERENCE

      SECTION 1.01.  Definitions.............................................1

      SECTION 1.02.  Incorporation by Reference of Trust Indenture Act.......20

      SECTION 1.03.  Rules of Construction...................................20

                                   ARTICLE TWO
                                    THE NOTES

      SECTION 2.01.  Form and Dating.........................................21

      SECTION 2.02.  Restrictive Legends.....................................22

      SECTION 2.03.  Execution, Authentication and Denominations.............25

      SECTION 2.04.  Registrar and Paying Agent..............................25

      SECTION 2.05.  Paying Agent to Hold Money in Trust.....................26

      SECTION 2.06.  Transfer and Exchange...................................27

      SECTION 2.07.  Book-entry Provisions for Global Notes..................27

      SECTION 2.08.  Special Transfer Provisions.............................29

      SECTION 2.09.  Replacement Notes.......................................32

      SECTION 2.10.  Outstanding Notes.......................................32

      SECTION 2.11.  Temporary Notes.........................................33

      SECTION 2.12.  Cancellation............................................33

      SECTION 2.13.  Cusip Numbers...........................................33

      SECTION 2.14.  Defaulted Interest......................................34

      SECTION 2.15.  Issuance of Additional Notes............................34

                                  ARTICLE THREE
                                   [RESERVED]

                                  ARTICLE FOUR
                                    COVENANTS

      SECTION 4.01.  Payment of Notes........................................34

      SECTION 4.02.  Maintenance of Office or Agency.........................35

      SECTION 4.03.  Limitation On Indebtedness..............................35

NOTE: The Table of Contents shall not for any purposes be deemed to be a part of
      this Indenture

                                       i
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      SECTION 4.04.  Limitation On Restricted Payments.......................38

      SECTION 4.05.  Limitation On Dividend and Other Payment
                     Restrictions Affecting Restricted Subsidiaries..........41

      SECTION 4.06.  Limitation On the Issuance and Sale of Capital Stock
                     of Restricted Subsidiaries..............................43

      SECTION 4.07.  Limitation On Issuances of Guarantees by Restricted
                     Subsidiaries............................................43

      SECTION 4.08.  Limitation On Transactions With Shareholders and
                     Affiliates..............................................44

      SECTION 4.09.  Limitation On Liens.....................................45

      SECTION 4.10.  Limitation On Sale-leaseback Transactions...............45

      SECTION 4.11.  Limitation On Asset Sales...............................46

      SECTION 4.12.  Repurchase of Notes Upon a Change of Control............47

      SECTION 4.13.  Existence...............................................47

      SECTION 4.14.  Payment of Taxes and Other Claims.......................47

      SECTION 4.15.  Maintenance of Properties and Insurance.................48

      SECTION 4.16.  Notice of Defaults......................................48

      SECTION 4.17.  Compliance Certificates.................................48

      SECTION 4.18.  Commission Reports and Reports to Holders...............48

      SECTION 4.19.  Waiver of Stay, Extension or Usury Laws.................49

                                  ARTICLE FIVE
                              SUCCESSOR CORPORATION

      SECTION 5.01.  When Company May Merge, Etc.............................49

      SECTION 5.02.  Successor Substituted...................................50

                                   ARTICLE SIX
                              DEFAULT AND REMEDIES

      SECTION 6.01.  Events of Default.......................................51

      SECTION 6.02.  Acceleration............................................52

      SECTION 6.03.  Other Remedies..........................................53

      SECTION 6.04.  Waiver of Past Defaults.................................53

      SECTION 6.05.  Control by Majority.....................................53

      SECTION 6.06.  Limitation On Suits.....................................53

      SECTION 6.07.  Rights of Holders to Receive Payment....................54

                                       ii
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      SECTION 6.08.  Collection Suit by Trustee..............................54

      SECTION 6.09.  Trustee May File Proofs of Claim........................55

      SECTION 6.10.  Priorities..............................................55

      SECTION 6.11.  Undertaking for Costs...................................55

      SECTION 6.12.  Restoration of Rights and Remedies......................56

      SECTION 6.13.  Rights and Remedies Cumulative..........................56

      SECTION 6.14.  Delay or Omission Not Waiver............................56

                                  ARTICLE SEVEN
                                     TRUSTEE

      SECTION 7.01.  General.................................................56

      SECTION 7.02.  Certain Rights of Trustee...............................57

      SECTION 7.03.  Individual Rights of Trustee............................58

      SECTION 7.04.  Trustee's Disclaimer....................................58

      SECTION 7.05.  Notice of Default.......................................58

      SECTION 7.06.  Reports by Trustee to Holders...........................59

      SECTION 7.07.  Compensation and Indemnity..............................59

      SECTION 7.08.  Replacement of Trustee..................................60

      SECTION 7.09.  Successor Trustee by Merger, Etc........................60

      SECTION 7.10.  Eligibility.............................................61

      SECTION 7.11.  Money Held in Trust.....................................61

      SECTION 7.12.  Withholding Taxes.......................................61

                                  ARTICLE EIGHT
                             DISCHARGE OF INDENTURE

      SECTION 8.01.  Termination of the Company's Obligations................61

      SECTION 8.02.  Defeasance and Discharge of Indenture...................62

      SECTION 8.03.  Defeasance of Certain Obligations.......................63

      SECTION 8.04.  Application of Trust Money..............................64

      SECTION 8.05.  Repayment to Company....................................64

      SECTION 8.06.  Reinstatement...........................................65

      SECTION 8.07.  Defeasance and Certain Other Events of Default..........65

                                       iii
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                                  ARTICLE NINE
                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

      SECTION 9.01.  Without Consent of Holders..............................65

      SECTION 9.02.  With Consent of Holders.................................66

      SECTION 9.03.  Revocation and Effect of Consent........................67

      SECTION 9.04.  Notation on or Exchange of Notes........................67

      SECTION 9.05.  Trustee to Sign Amendments, Etc.........................68

      SECTION 9.06.  Conformity With Trust Indenture Act.....................68

                                   ARTICLE TEN
                                   [RESERVED]

                                 ARTICLE ELEVEN
                                  MISCELLANEOUS

      SECTION 11.01. Trust Indenture Act of 1939.............................68

      SECTION 11.02. Notices.................................................68

      SECTION 11.03. Certificate and Opinion as to Conditions Precedent......70

      SECTION 11.04. Statements Required in Certificate or Opinion...........70

      SECTION 11.05. Rules by Trustee, Paying Agent or Registrar.............70

      SECTION 11.06. Payment Date Other Than a Business Day..................70

      SECTION 11.07. Governing Law; Submission to Jurisdiction; Agent
                     for Service.............................................71

      SECTION 11.08. No Adverse Interpretation of Other Agreements...........71

      SECTION 11.09. No Recourse Against Others..............................71

      SECTION 11.10. Successors..............................................71

      SECTION 11.11. Duplicate Originals.....................................71

      SECTION 11.12. Separability............................................71

      SECTION 11.13. Table of Contents, Headings, Etc........................72

      SECTION 11.14. Method of Payment.......................................72

      SECTION 11.15. Judgment Currency.......................................72

      EXHIBIT A   Form of Restricted Global Note...........................A-1
      EXHIBIT B   Form of Regulation S Global Note.........................B-1
      EXHIBIT C   Form of U.S. Certificated Note...........................C-1
      EXHIBIT D   Form of Certificate......................................D-1
      EXHIBIT E   Form of Certificate to Be Delivered in Connection with
                  Transfers Pursuant to Regulation S.......................E-1

                                       iv
<PAGE>

      EXHIBIT F   Form of Certificate to Be Delivered in Connection with
                  Transfers to Non-QIB Accredited Investors................F-1

                                       v
<PAGE>

          INDENTURE,  dated  as of April  20,  2000,  between  VIATEL,  INC.,  a
Delaware corporation, as issuer (the "COMPANY"), and THE BANK OF NEW YORK, a New
York banking corporation, as trustee (the "TRUSTEE").

          RECITALS OF THE COMPANY

          The Company has duly  authorized  the  execution  and delivery of this
Indenture to provide for the  issuance  from time to time of 12 3/4% Senior Euro
Notes due 2008 (the "NOTES") issuable as provided in this Indenture. Pursuant to
the terms of a Placement  Agreement  dated as of April 14, 2000 (the  "PLACEMENT
AGREEMENT") between the Company and Morgan Stanley & Co. International  Limited,
as the manager for itself and the several  placement  agents named on Schedule I
thereto (the  "MANAGER"),  the Company has agreed to issue and sell an aggregate
of Euro 300,000,000 of Notes.

          All things  necessary to make this Indenture a valid  agreement of the
Company,  in accordance with its terms, have been done, and the Company has done
all things  necessary  to make the  Notes,  when  executed  by the  Company  and
authenticated  and  delivered  by the Trustee  hereunder  and duly issued by the
Company,  the legal, valid and binding obligations of the Company as hereinafter
provided.

          This  Indenture  will,  upon  the  effectiveness  of the  registration
statement provided for under the Registration  Rights Agreement,  be subject to,
and governed by, the provisions of the Trust  Indenture Act of 1939, as amended,
that are required to be a part of and to govern  indentures  qualified under the
Trust Indenture Act of 1939, as amended.

          For and in consideration of the premises and the purchase of the Notes
by the Holders thereof,  it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders, as follows.

                                   ARTICLE ONE
                  DEFINITIONS AND INCORPORATION BY REFERENCE

          SECTION 1.01. DEFINITIONS.

          "Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Restricted  Subsidiary or assumed in connection  with
an Asset Acquisition by the Company or a Restricted  Subsidiary and not Incurred
in connection  with, or in  anticipation  of, such Person  becoming a Restricted
Subsidiary or such Asset Acquisition.

          "Adjusted   Consolidated  Net  Income"  means,  for  any  period,  the
aggregate  net income (or loss) of the Company and its  Restricted  Subsidiaries
for such period  determined in conformity  with  generally  accepted  accounting
principles;  PROVIDED  that the  following  items shall be excluded in computing
Adjusted Consolidated Net Income (without  duplication):  (i) the net income (or
loss) of any Person that is not a Restricted Subsidiary, except (x) with respect
to net income,  to the extent of the amount of dividends or other  distributions
actually  paid to the  Company  or any of its  Restricted  Subsidiaries  by such
Person  during such period and (y) with respect to net losses,  to the extent of
the amount of Investments  made by the Company or any  Restricted  Subsidiary in

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such Person during such period;  (ii) solely for the purposes of calculating the
amount of  Restricted  Payments  that may be made  pursuant to clause (C) of the
first  paragraph of Section 4.04 hereof (and in such case,  except to the extent
includable pursuant to clause (i) above), the net income (or loss) of any Person
accrued  prior to the date it becomes a Restricted  Subsidiary or is merged into
or consolidated with the Company or any of its Restricted Subsidiaries or all or
substantially  all of the property and assets of such Person are acquired by the
Company  or any of its  Restricted  Subsidiaries;  (iii)  the net  income of any
Restricted Subsidiary to the extent that the declaration or payment of dividends
or similar distributions by such Restricted Subsidiary of such net income is not
at the time  permitted  by the  operation  of the  terms of its  charter  or any
agreement,  instrument,  judgment,  decree, order, statute, rule or governmental
regulation  applicable to such Restricted  Subsidiary;  (iv) any gains or losses
(on an  after-tax  basis)  attributable  to Asset Sales and sales of capacity or
dark fibers;  (v) except for purposes of  calculating  the amount of  Restricted
Payments  that may be made  pursuant  to clause  (C) of the first  paragraph  of
Section 4.04 hereof,  any amount paid or accrued as dividends on Preferred Stock
of the  Company or any  Restricted  Subsidiary  owned by Persons  other than the
Company and any of its Restricted Subsidiaries; (vi) all extraordinary gains and
extraordinary  losses; and (vii) any compensation expense paid or payable solely
with  Capital  Stock  (other  than  Disqualified  Stock) of the  Company  or any
options,  warrants  or  other  rights  to  acquire  Capital  Stock  (other  than
Disqualified Stock) of the Company.

          "Adjusted  Consolidated Net Tangible Assets" means the total amount of
assets  of  the  Company  and  its  Restricted   Subsidiaries  (less  applicable
depreciation,  amortization and other valuation reserves),  except to the extent
resulting from write-ups of capital  assets  (excluding  write-ups in connection
with  accounting for  acquisitions  in conformity  with GAAP),  after  deducting
therefrom  (i)  all  current  liabilities  of the  Company  and  its  Restricted
Subsidiaries (excluding intercompany items) and (ii) all goodwill,  trade names,
trademarks,  patents,  unamortized  debt  discount  and  expense  and other like
intangibles,   all  as  set  forth  on  the  most  recent  quarterly  or  annual
consolidated  balance  sheet of the  Company  and its  Restricted  Subsidiaries,
prepared in  conformity  with GAAP and filed with the  Commission or provided to
the Trustee pursuant to Section 4.18 hereof.

          "Affiliate" means, as applied to any Person, any other Person directly
or indirectly  controlling,  controlled  by, or under direct or indirect  common
control  with,  such  Person.   For  purposes  of  this  definition,   "control"
(including,  with correlative meanings, the terms "controlling," "controlled by"
and  "under  common  control  with"),  as  applied  to  any  Person,  means  the
possession,  directly  or  indirectly,  of the  power to  direct  or  cause  the
direction of the  management  and policies of such Person,  whether  through the
ownership of voting securities, by contract or otherwise.

          "Agent" means any  Registrar,  Paying Agent,  authenticating  agent or
co-Registrar.

          "Agent Members" has the meaning provided in Section 2.07(a) hereof.

          "Asset  Acquisition"  means (i) an investment by the Company or any of
its Restricted  Subsidiaries  in any other Person  pursuant to which such Person
shall become a  Restricted  Subsidiary  or shall be merged into or  consolidated

                                       2
<PAGE>

with the  Company  or any of its  Restricted  Subsidiaries;  PROVIDED  that such
Person's  primary  business  is  related,  ancillary  or  complementary  to  the
businesses of the Company or any of its Restricted  Subsidiaries  on the date of
such  investment or (ii) an  acquisition by the Company or any of its Restricted
Subsidiaries  of the property and assets of any Person other than the Company or
any  of its  Restricted  Subsidiaries  that  constitute  substantially  all of a
division or line of business of such  Person;  PROVIDED  that the  property  and
assets acquired are related, ancillary or complementary to the businesses of the
Company or any of its Restricted Subsidiaries on the date of such acquisition.

          "Asset Disposition" means the sale or other disposition by the Company
or any of its  Restricted  Subsidiaries  (other  than to the  Company or another
Restricted  Subsidiary) of (i) all or substantially  all of the Capital Stock of
any Restricted  Subsidiary or (ii) all or  substantially  all of the assets that
constitute  a  division  or  line  of  business  of  the  Company  or any of its
Restricted Subsidiaries.

          "Asset Sale" means any sale, transfer or other disposition  (including
by  way  of  merger,   consolidation  or  sale-leaseback   transaction)  in  one
transaction  or a series of related  transactions  by the  Company or any of its
Restricted  Subsidiaries  to any  Person  other  than the  Company or any of its
Restricted Subsidiaries of (i) all or any of the Capital Stock of any Restricted
Subsidiary,  (ii) all or  substantially  all of the  property  and  assets  of a
division  or  line  of  business  of  the  Company  or  any  of  its  Restricted
Subsidiaries  or (iii) any other  property  and assets  (other  than the Capital
Stock or other  Investment in an Unrestricted  Subsidiary) of the Company or any
of its Restricted  Subsidiaries  outside the ordinary  course of business of the
Company or such Restricted Subsidiary and, in each case, that is not governed by
Article Five hereof;  PROVIDED  that "Asset Sale" shall not include (a) sales or
other  dispositions  of inventory,  receivables  and other current  assets,  (b)
sales,  transfers  or other  dispositions  of assets  constituting  a Restricted
Payment permitted to be made under Section 4.04 hereof, (c) sales,  transfers or
other  dispositions  of assets  with a fair  market  value (as  certified  in an
Officers'  Certificate) not in excess of $1 million in any transaction or series
of  related  transactions,  (d)  sales  or  other  dispositions  of  assets  for
consideration  at least  equal to the fair  market  value of the assets  sold or
disposed  of, to the extent that the  consideration  received  would  constitute
property or assets of the kind  described  in clause (B) of Section 4.11 hereof,
(e) any liquidation of Temporary Cash Investments,  (f) a transfer,  directly or
indirectly,  of  receivables  or other payment rights arising from a transfer of
indefeasible  rights of use or dark  fiber,  which  transfer of  receivables  or
rights is to a  special  purpose  entity  created  for the  purpose  of  issuing
securities to be paid or redeemed from, or beneficial  interests in, the cash or
revenues generated from the assets transferred;  PROVIDED that the consideration
received by the Company is at least equal to the fair market  value of the asset
transferred and the proceeds are used by the Company (A) to repay unsubordinated
Indebtedness  of the  Company  owed to a  Person  other  than the  Company  or a
Restricted Subsidiary, (B) to invest in the manner described in clause (i)(B) of
Section 4.11 hereof or (C) for working  capital  purposes or (g) other transfers
of capacity or dark fiber.

          "Average Life" means, at any date of determination with respect to any
debt security,  the quotient obtained by dividing (i) the sum of the products of
(a) the  number of years  from such date of  determination  to the dates of each

                                       3
<PAGE>

successive  scheduled principal payment of such debt security and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.

          "Board of  Directors"  means the Board of  Directors of the Company as
required  by the  context  or any  committee  of such  Board of  Directors  duly
authorized to act under this Indenture.

          "Board  Resolution"  means a copy of a  resolution,  certified  by the
Secretary  or  Assistant  Secretary of the Company as required by the context to
have been duly  adopted  by the Board of  Directors  and to be in full force and
effect on the date of such certification, and delivered to the Trustee.

          "Business Day" means any day except a Saturday, Sunday or other day on
which  commercial  banks in the City of New York,  in the city of the  Corporate
Trust  Office  of the  Trustee  or in the  city in  which  any  Paying  Agent or
Registrar is located are authorized or required by law to close.

          "Capital Stock" means, with respect to any Person, any and all shares,
interests,  participations or other  equivalents  (however  designated,  whether
voting or  non-voting)  in equity of such  Person,  whether  outstanding  on the
Closing Date or issued thereafter,  including,  without  limitation,  all Common
Stock and Preferred Stock.

          "Capitalized  Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental  obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person.

          "Capitalized  Lease Obligations" means the discounted present value of
the rental obligations under a Capitalized Lease.

          "Certificated  Notes" has the meaning provided in Section 2.01 hereof.

          "Change of  Control"  means  such time as (i) a "person"  or a "group"
(within the meaning of Sections  13(d) and 14(d)(2) of the Exchange Act) becomes
the  ultimate  "beneficial  owner" (as defined in Rule 13d-3 under the  Exchange
Act) of more  than 50% of the  total  voting  power of the  Voting  Stock of the
Company on a fully diluted basis;  or (ii)  individuals  who on the Closing Date
constitute  the  Board  of  Directors  (together  with any new  directors  whose
election by the Board of Directors or whose nomination to the Board of Directors
for election by the  Company's  stockholders  was approved by a vote of at least
two-thirds  of the members of the Board of  Directors  then in office who either
were members of the Board of Directors on the Closing Date or whose  election or
nomination  for election  was  previously  so approved)  cease for any reason to
constitute a majority of the members of the Board of Directors then in office.

          "Clearstream" means Clearstream Banking, SOCIETE ANONYME.

          "Closing Date" means the date on which the Notes are originally issued
under this Indenture.

                                       4
<PAGE>

          "Common  Depositary" means The Bank of New York, London Branch, or any
of its successors  acting in the capacity of common depositary for Euroclear and
Clearstream.

          "Commission"  means the  Securities and Exchange  Commission,  as from
time to time  constituted,  created  under the  Exchange  Act or, if at any time
after the  execution  of this  instrument  such  Commission  is not existing and
performing the duties now assigned to it under the TIA, then the body performing
such duties at such time.

          "Common Stock" means, with respect to any Person,  any and all shares,
interests,  participations or other  equivalents  (however  designated,  whether
voting or non-voting) of such Person's common stock,  whether now outstanding or
issued after the date of this  Indenture,  including,  without  limitation,  all
series and classes of such common stock.

          "Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to the applicable provisions of
this Indenture and thereafter means the successor.

          "Company Order" means a written request or order signed in the name of
the Company (i) by its  Chairman of the Board,  the Vice  Chairman of the Board,
its  President  or a Vice  President  and (ii) by its Chief  Financial  Officer,
Treasurer,  an Assistant Treasurer,  its Secretary or an Assistant Secretary and
delivered to the Trustee; PROVIDED,  HOWEVER, that such written request or order
may be signed by any two of the officers or directors listed in clause (i) above
in lieu of being  signed by one of such  officers  or  directors  listed in such
clause (i) and one of the officers listed in clause (ii) above.

          "Consolidated EBITDA" means, for any period, Adjusted Consolidated Net
Income  for such  period  plus,  to the  extent  such  amount  was  deducted  in
calculating  such Adjusted  Consolidated Net Income,  (i) Consolidated  Interest
Expense,  (ii) income  taxes,  (iii)  depreciation  expense,  (iv)  amortization
expense and (v) all other  non-cash  items reducing  Adjusted  Consolidated  Net
Income  (other  than  items that will  require  cash  payments  and for which an
accrual or reserve is, or is required by GAAP to be,  made),  less all  non-cash
items  increasing  Adjusted  Consolidated  Net Income,  all as  determined  on a
consolidated basis for the Company and its Restricted Subsidiaries in conformity
with GAAP;  PROVIDED  that, if any  Restricted  Subsidiary is not a Wholly Owned
Restricted  Subsidiary,  Consolidated EBITDA shall be reduced (to the extent not
otherwise  reduced in accordance with GAAP) by an amount equal to (A) the amount
of  the  Adjusted  Consolidated  Net  Income  attributable  to  such  Restricted
Subsidiary  multiplied by (B) the percentage ownership interest in the income of
such  Restricted  Subsidiary  not  owned on the last day of such  period  by the
Company or any of its Restricted Subsidiaries.

          "Consolidated  Interest Expense" means, for any period,  the aggregate
amount of interest in respect of Indebtedness  (including,  without  limitation,
amortization  of original  issue discount on any  Indebtedness  and the interest
portion of any deferred  payment  obligation,  calculated in accordance with the
effective  interest method of accounting;  all commissions,  discounts and other
fees and charges owed with respect to letters of credit and bankers'  acceptance
financing; the net costs associated with Interest Rate Agreements;  and interest
in respect of  Indebtedness  that is Guaranteed or secured by the Company or any

                                       5
<PAGE>

of its Restricted  Subsidiaries,  and all but the principal component of rentals
in respect of Capitalized  Lease  Obligations  paid,  accrued or scheduled to be
paid or to be accrued by the Company and its Restricted Subsidiaries during such
periods).

          "Consolidated  Leverage  Ratio" means,  on any  Transaction  Date, the
ratio  of (i) the  aggregate  amount  of  Indebtedness  of the  Company  and its
Restricted  Subsidiaries on a consolidated basis outstanding on such Transaction
Date to (ii) four  times  Consolidated  EBITDA for the then most  recent  fiscal
quarter for which  financial  statements of the Company have been filed with the
Commission or provided to the Trustee pursuant to Section 4.18 hereof;  PROVIDED
that, in making the foregoing  calculation,  (A) PRO FORMA effect shall be given
to the Incurrence or repayment of any  Indebtedness  to be Incurred or repaid on
the Transaction Date; (B) PRO FORMA effect shall be given to Asset  Dispositions
and Asset Acquisitions  (including giving PRO FORMA effect to the application of
proceeds of any Asset  Disposition)  that occur from the  beginning  of the then
most recent four fiscal quarters  through the  Transaction  Date (the "REFERENCE
PERIOD"),  as if they had  occurred  and such  proceeds  had been applied on the
first day of such Reference  Period;  and (C) PRO FORMA effect shall be given to
asset dispositions and asset acquisitions  (including giving PRO FORMA effect to
the application of proceeds of any asset disposition) that have been made by any
Person that has become a Restricted  Subsidiary  or has been merged with or into
the Company or any Restricted  Subsidiary  during such Reference Period and that
would  have  constituted  Asset  Dispositions  or  Asset  Acquisitions  had such
transactions  occurred  when such Person was a Restricted  Subsidiary as if such
asset  dispositions  or asset  acquisitions  were  Asset  Dispositions  or Asset
Acquisitions that occurred on the first day of such Reference  Period;  PROVIDED
that to the extent that  clause (B) or (C) of this  sentence  requires  that PRO
FORMA effect be given to an Asset  Acquisition  or Asset  Disposition,  such PRO
FORMA calculation shall be based upon the four full fiscal quarters  immediately
preceding the Transaction Date of the Person, or division or line of business of
the Person,  that is acquired or disposed of for which financial  information is
available.

          "Consolidated   Net  Worth"  means,  at  any  date  of  determination,
stockholders'  equity as set forth on the most recently  available  quarterly or
annual consolidated balance sheet of the Company and its Restricted Subsidiaries
(which  shall be as of a date not  more  than 90 days  prior to the date of such
computation,  and which shall not take into account Unrestricted  Subsidiaries),
including,  without limitation,  the respective amounts reported on such balance
sheet  attributable  to  Preferred  Stock,  less  any  amounts  attributable  to
Disqualified  Stock or any equity security  convertible into or exchangeable for
Indebtedness,  the  cost of  treasury  stock  and the  principal  amount  of any
promissory notes receivable from the sale of the Capital Stock of the Company or
any of its  Restricted  Subsidiaries,  each item to be  determined in conformity
with GAAP (excluding the effects of foreign currency exchange  adjustments under
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 52).

          "Corporate  Trust Office" means the office of the Trustee at which the
corporate  trust  business of the Trustee  shall,  at any  particular  time,  be
principally  administered,  which  office  is,  at the  date of this  Indenture,
located at 101  Barclay  Street,  Floor 21 West,  New York NY 10286,  Attention:
Corporate Trust Administration.

                                       6
<PAGE>

          "Currency  Agreement"  means any foreign exchange  contract,  currency
swap agreement or other similar agreement or arrangement.

          "Default"  means any event that is, or after notice or passage of time
or both would be, an Event of Default.

          "Depository"  shall mean,  with respect to the Regulation S Global and
European  144A Global,  Euroclear and  Clearstream  and, with respect to the DTC
Rule 144A Global, DTC.

          "Disqualified Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise  is (i)  required to be redeemed  prior to
the Stated Maturity of the Notes, (ii) redeemable at the option of the holder of
such class or series of Capital  Stock at any time prior to the Stated  Maturity
of the  Notes  or (iii)  convertible  into or  exchangeable  for  Capital  Stock
referred  to in clause  (i) or (ii)  above or  Indebtedness  having a  scheduled
maturity  prior to the Stated  Maturity of the Notes;  PROVIDED that any Capital
Stock that would not constitute  Disqualified  Stock but for provisions  thereof
giving holders  thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring  prior to the  Stated  Maturity  of the  Notes  shall  not  constitute
Disqualified  Stock  if the  "asset  sale" or  "change  of  control"  provisions
applicable  to such Capital  Stock are no more  favorable to the holders of such
Capital  Stock than the  provisions  contained in Sections 4.11 and 4.12 hereof,
and  such  Capital  Stock,  or  the  agreements  or  instruments  governing  the
redemption  rights  thereof,  specifically  provides  that such  Person will not
repurchase  or redeem any such stock  pursuant  to such  provision  prior to the
Company's repurchase of such Notes as are required to be repurchased pursuant to
Sections 4.11 and 4.12 hereof.

          "DTC" means The  Depository  Trust  Company,  its nominees,  and their
respective successors.

          "DTC Noteholder" has the meaning provided in Section 11.14.

          "DTC Rule 144A Global" has the meaning provided in Section 2.01.

          "Euroclear"  means Morgan Guaranty Trust Company of New York (Brussels
office) as operator of the Euroclear system and any successor thereto.

          "Euro Paying Agent" means The Bank of New York, London Branch, located
at 46 Berkeley  Street,  London WIX 6AA, United Kingdom and any successor paying
agent.

          "European  Government  Obligations"  means  the  securities  that  are
directly and unconditionally  obligations of the Belgian,  Dutch, French, German
or Swiss  government  which are not callable or  redeemable at the option of the
issuer thereof  (PROVIDED that at the time of determination  the conversion rate
between the sovereign  currency of such country and the Euro is fixed) and shall
also include a depository receipt issued by a bank or trust company as custodian
with respect to any such European Government Obligation or a specific payment of
interest on or principal of any such European Government Obligation held by such
custodian for the account of the holder of a depository  receipt;  PROVIDED that

                                       7
<PAGE>

(except  as  required  by law)  such  custodian  is not  authorized  to make any
deduction from the amount payable to the holder of such depository  receipt from
any amount  received  by the  custodian  in respect of the  European  Government
Obligation  or the specific  payment of interest on or principal of the European
Government Obligation evidenced by such depository receipt.

          "European 144A Global" has the meaning provided in Section 2.01.

          "Event of Default" has the meaning provided in Section 6.01 hereof.

          "Excess Proceeds" has the meaning provided in Section 4.11 hereof.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

          "Exchange  Notes"  means any  notes of the  Company  containing  terms
identical to the Notes (except that such Exchange  Notes (i) shall be registered
under the  Securities  Act, (ii) will not provide for an increase in the rate of
interest (other than with respect to overdue amounts) and (iii) will not contain
terms with respect to transfer  restrictions)  that are issued and exchanged for
the Notes pursuant to the Registration Rights Agreement and this Indenture.

          "Existing Stockholder  Agreements" means the Stock Purchase Agreement,
dated as of  September  30, 1993,  between the Company and S-C V-Tel,  the Stock
Purchase  Agreement  dated as of April 5, 1994,  between the Company and COMSAT,
the S-C V-Tel Shareholders'  Agreement and the COMSAT  Shareholders'  Agreement,
and, in each case, any amendments to such agreements.

          "fair  market  value"  means  the  price  that  would  be  paid  in an
arm's-length  transaction  between  an  informed  and  willing  seller  under no
compulsion to sell and an informed and willing buyer under no compulsion to buy,
as determined in good faith by the Board of Directors, whose determination shall
be conclusive if evidenced by a Board Resolution; PROVIDED that, for purposes of
clause  (viii) of the second  paragraph  of Section  4.03  hereof,  (x) the fair
market  value of any  security  registered  under the  Exchange Act shall be the
average  of the  closing  prices,  regular  way,  of  such  security  for the 20
consecutive trading days immediately preceding the sale of Capital Stock and (y)
in the event the aggregate fair market value of any other  property  (other than
cash or cash equivalents)  received by the Company exceeds $30 million, the fair
market value of such property  shall be  determined  by a nationally  recognized
investment banking firm or a nationally  recognized firm having expertise in the
specific area which is the subject of such  determination and set forth in their
written opinion which shall be delivered to the Trustee.

          "GAAP" means generally  accepted  accounting  principles in the United
States of  America  as in  effect as of the  Closing  Date,  including,  without
limitation, those set forth in the opinions and pronouncements of the Accounting
Principles Board of the American  Institute of Certified Public  Accountants and
statements and pronouncements of the Financial  Accounting Standards Board or in
such other statements by such other entity as approved by a significant  segment
of the accounting profession.  All ratios and computations contained or referred
to in this  Indenture  shall be computed in  conformity  with GAAP  applied on a
consistent  basis,  except that  calculations  made for purposes of  determining
compliance  with the terms of the  covenants  and with other  provisions of this

                                       8
<PAGE>

Indenture  shall  be made  without  giving  effect  to (i) the  amortization  or
write-off of any expenses incurred in connection with the offering of the Notes,
and (ii) except as otherwise provided,  the amortization of any amounts required
or permitted by Accounting Principles Board Opinion Nos. 16 and 17.

          "Global Notes" has the meaning provided in Section 2.01.

          "Guarantee"  means any  obligation,  contingent or  otherwise,  of any
Person directly or indirectly  guaranteeing any Indebtedness of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect,  contingent  or  otherwise,  of such Person (i) to purchase or pay (or
advance or supply  funds for the  purchase or payment of) such  Indebtedness  of
such other Person (whether arising by virtue of partnership arrangements,  or by
agreements  to  keep-well,  to purchase  assets,  goods,  securities or services
(unless such purchase  arrangements  are on  arm's-length  terms and are entered
into in the  ordinary  course  of  business),  to  take-or-pay,  or to  maintain
financial  statement  conditions or otherwise) or (ii) entered into for purposes
of assuring in any other manner the obligee of such  Indebtedness of the payment
thereof or to protect such obligee  against loss in respect thereof (in whole or
in part);  PROVIDED that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business.  The term  "Guarantee"
used as a verb has a corresponding meaning.

          "Guaranteed  Indebtedness"  has the meaning  provided in Section  4.07
hereof.

          "Holder" or "Noteholder" means the registered holder of any Note.

          "Incur" means,  with respect to any  Indebtedness,  to incur,  create,
issue,  assume,  Guarantee or otherwise become liable for or with respect to, or
become  responsible  for,  the  payment  of,  contingently  or  otherwise,  such
Indebtedness,  including an "Incurrence" of Acquired Indebtedness; PROVIDED that
neither the accrual of interest  nor the  accretion of original  issue  discount
shall be considered an Incurrence of Indebtedness.

          "Indebtedness"  means,  with  respect  to any  Person  at any  date of
determination  (without  duplication),  (i) all  indebtedness of such Person for
borrowed  money,  (ii)  all  obligations  of such  Person  evidenced  by  bonds,
debentures,  notes or other similar  instruments,  (iii) all obligations of such
Person in respect of letters of credit or other similar  instruments  (including
reimbursement  obligations with respect thereto, but excluding  obligations with
respect to  letters  of credit  (including  trade  letters  of credit)  securing
obligations (other than obligations  described in (i) or (ii) above or (v), (vi)
or (vii) below)  entered into in the ordinary  course of business of such Person
to the extent such  letters of credit are not drawn upon or, if drawn  upon,  to
the extent  such  drawing is  reimbursed  no later than the third  Business  Day
following  receipt  by such  Person  of a demand  for  reimbursement),  (iv) all
obligations  of such Person to pay the  deferred  and unpaid  purchase  price of
property or services, which purchase price is due more than six months after the
date of placing such property in service or taking delivery and title thereto or
the  completion of such services,  except Trade  Payables,  (v) all  Capitalized
Lease Obligations of such Person, (vi) all Indebtedness of other Persons secured
by a Lien on any  asset of such  Person,  whether  or not such  Indebtedness  is
assumed by such Person;  PROVIDED that the amount of such Indebtedness  shall be
the  lesser  of (A) the  fair  market  value  of  such  asset  at  such  date of
determination and (B) the amount of such Indebtedness, (vii) all Indebtedness of

                                       9
<PAGE>

other  Persons  Guaranteed  by such  Person to the extent such  Indebtedness  is
Guaranteed  by such  Person and (viii) to the extent not  otherwise  included in
this  definition,  obligations  under  Currency  Agreements  and  Interest  Rate
Agreements.  The amount of  Indebtedness  of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations,  as described
above,  and the  maximum  liability  at such time  with  respect  to  contingent
obligations  upon  the  occurrence  of  the  contingency   giving  rise  to  the
obligation,  which, in the case of a Guarantee, shall be the outstanding balance
of the Guaranteed Indebtedness,  PROVIDED (A) that the amount outstanding at any
time of any Indebtedness  issued with original issue discount is the face amount
of such  Indebtedness  less the  remaining  unamortized  portion of the original
issue discount of such Indebtedness at the time of its issuance as determined in
conformity  with GAAP,  (B) that money borrowed and set aside at the time of the
Incurrence of any  Indebtedness  in order to prefund the payment of the interest
on such  Indebtedness  shall not be deemed to be  "Indebtedness" so long as such
money is held to secure the payment of such  interest and (C) that  Indebtedness
shall not include any liability for federal, state, local or other taxes.

          "Indenture"  means this Indenture as originally  executed or as it may
be  amended  or  supplemented  from  time  to  time  by one or  more  indentures
supplemental  to  this  Indenture   entered  into  pursuant  to  the  applicable
provisions of this Indenture.

          "Institutional  Accredited Investor" shall mean an institution that is
an "accredited investor" as that term is defined in Rule 501(a)(1),  (2), (3) or
(7) under the Securities Act.

          "Interest Payment Date" means each semiannual interest payment date on
April 15 and October 15 of each year, commencing October 15, 2000.

          "Interest  Rate   Agreement"   means  any  interest  rate   protection
agreement,  interest  rate future  agreement,  interest  rate option  agreement,
interest rate swap agreement,  interest rate cap agreement, interest rate collar
agreement,  interest rate hedge  agreement,  option or future  contract or other
similar agreement or arrangement.

          "Investment" in any Person means any direct or indirect advance,  loan
or other extension of credit (including, without limitation, by way of Guarantee
or similar  arrangement;  but excluding extensions of credit to customers in the
ordinary  course of business  that are,  in  conformity  with GAAP,  recorded as
accounts  receivable  on the  balance  sheet of the  Company  or its  Restricted
Subsidiaries)  or capital  contribution  to (by means of any transfer of cash or
other property to others or any payment for property or services for the account
or use of others),  or any  purchase or  acquisition  of Capital  Stock,  bonds,
notes,  debentures or other similar instruments issued by, such Person and shall
include  (i) the  designation  of a  Restricted  Subsidiary  as an  Unrestricted
Subsidiary  and (ii) the fair market  value of the  Capital  Stock (or any other
Investment),  held by the Company or any of its Restricted Subsidiaries,  of (or
in) any Person that has ceased to be a Restricted Subsidiary, including, without
limitation,  by reason of any  transaction  permitted by clause (iii) of Section
4.06 hereof;  PROVIDED that the fair market value of the Investment remaining in
any Person that has ceased to be a  Restricted  Subsidiary  shall not exceed the
aggregate  amount of  Investments  previously  made in such Person valued at the
time such Investments were made less the net reduction of such Investments.  For
purposes of the definition of "Unrestricted Subsidiary" and Section 4.04 hereof,

                                       10
<PAGE>

(i)  "Investment"  shall  include  the fair  market  value of the assets (net of
liabilities  (other than  liabilities  to the  Company or any of its  Restricted
Subsidiaries))  of any  Restricted  Subsidiary at the time that such  Restricted
Subsidiary is designated an Unrestricted Subsidiary,  (ii) the fair market value
of the assets (net of liabilities  (other than liabilities to the Company or any
of its Restricted Subsidiaries)) of any Unrestricted Subsidiary at the time that
such  Unrestricted  Subsidiary  is designated a Restricted  Subsidiary  shall be
considered  a  reduction  in  outstanding  Investments  and (iii)  any  property
transferred to or from an  Unrestricted  Subsidiary  shall be valued at its fair
market value at the time of such transfer.

          "Judgment Currency" has the meaning provided in Section 11.15.

          "Lien" means any mortgage,  pledge,  security  interest,  encumbrance,
lien or charge of any kind (including,  without limitation, any conditional sale
or  other  title  retention  agreement  or lease in the  nature  thereof  or any
agreement to give any security interest).

          "Manager" means Morgan Stanley & Co.  International  Limited,  as lead
manager for the several initial purchasers named in the Placement Agreement.

          "Moody's" means Moody's Investors Service, Inc. and its successors.

          "Net Cash  Proceeds"  means,  (a) with respect to any Asset Sale,  the
proceeds of such Asset Sale in the form of cash or cash  equivalents,  including
payments in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in the form
of cash or cash equivalents  (except to the extent such obligations are financed
or sold with recourse to the Company or any Restricted  Subsidiary) and proceeds
from the  conversion of other  property  received when converted to cash or cash
equivalents,  net of (i)  brokerage  commissions  and  other  fees and  expenses
(including fees and expenses of counsel and investment  bankers) related to such
Asset  Sale,  (ii)  provisions  for all taxes  (whether  or not such  taxes will
actually be paid or are payable) as a result of such Asset Sale  without  regard
to the  consolidated  results of  operations  of the Company and its  Restricted
Subsidiaries,  taken as a whole,  (iii)  payments made or required to be made to
repay Indebtedness or any other obligation outstanding at the time of such Asset
Sale that either (A) is secured by a Lien on the  property or assets sold or (B)
is required to be paid as a result of such sale,  (iv) payments made or required
to be made to Persons having a beneficial  interest in the assets subject to the
Asset  Sale,  and (v)  appropriate  amounts to be provided by the Company or any
Restricted Subsidiary as a reserve against any liabilities  associated with such
Asset Sale,  including,  without limitation,  pension and other  post-employment
benefit   liabilities,   liabilities   related  to  environmental   matters  and
liabilities  under any  indemnification  obligations  associated with such Asset
Sale,  all as determined in  conformity  with GAAP,  and (b) with respect to any
issuance or sale of Capital Stock,  the proceeds of such issuance or sale in the
form of cash or cash  equivalents,  including  payments  in respect of  deferred
payment  obligations  (to the extent  corresponding  to the  principal,  but not
interest,  component  thereof)  when  received  in the  form  of  cash  or  cash
equivalents  (except to the extent such  obligations  are  financed or sold with
recourse to the Company or any  Restricted  Subsidiary)  and  proceeds  from the
conversion  of  other   property   received  when  converted  to  cash  or  cash
equivalents,  net  of  attorney's  fees,  accountants'  fees,  underwriters'  or
placement agents' fees,  discounts or commissions and brokerage,  consultant and

                                       11
<PAGE>

other fees  incurred in  connection  with such issuance or sale and net of taxes
paid or payable as a result thereof.

          "Non-U.S.  Person" means a Person who is not a U.S. person, as defined
in Regulation S.

          "Notes" means any of the Notes,  as defined in the first  paragraph of
the recitals hereof,  that are authenticated and delivered under this Indenture.
For all purposes of this Indenture,  the term "Notes" shall include any Exchange
Notes to be issued and  exchanged  for any Notes  pursuant  to the  Registration
Rights  Agreement and this  Indenture and, for purposes of this  Indenture,  all
Notes and Exchange  Notes shall vote  together as one series of Notes under this
Indenture.

          "Note Register" has the meaning provided in Section 2.04.

          "Offer to  Purchase"  means an offer to purchase  Notes by the Company
from the  Holders  commenced  by mailing a notice to the Trustee and each Holder
stating: (i) the covenant pursuant to which the offer is being made and that all
Notes validly  tendered  will be accepted for payment on a PRO RATA basis;  (ii)
the  purchase  price and the date of purchase  (which shall be a Business Day no
earlier than 30 days nor later than 60 days from the date such notice is mailed)
(the "PAYMENT  DATE");  (iii) that any Note not tendered will continue to accrue
interest  pursuant to its terms;  (iv) that,  unless the Company defaults in the
payment of the purchase  price,  any Note  accepted for payment  pursuant to the
Offer to Purchase shall cease to accrue  interest on and after the Payment Date;
(v) that  Holders  electing  to have a Note  purchased  pursuant to the Offer to
Purchase will be required to surrender the Note, together with the form entitled
"Option  of the  Holder  to  Elect  Purchase"  on the  reverse  side of the Note
completed,  to the Paying Agent at the address  specified in the notice prior to
the close of business on the  Business  Day  immediately  preceding  the Payment
Date;  (vi) that  Holders  will be entitled to  withdraw  their  election if the
Paying  Agent  receives,  not  later  than the  close of  business  on the third
Business Day  immediately  preceding  the Payment  Date,  a telegram,  facsimile
transmission  or letter  setting  forth the name of such Holder,  the  principal
amount of Notes  delivered  for  purchase  and a  statement  that such Holder is
withdrawing  his election to have such Notes  purchased;  and (vii) that Holders
whose Notes are being  purchased  only in part will be issued new Notes equal in
principal amount to the unpurchased  portion of the Notes surrendered;  PROVIDED
that each Note purchased and each new Note issued shall be in a principal amount
of Euro 1,000 or an integral multiple thereof.  On the Payment Date, the Company
shall (i) accept  for  payment on a PRO RATA  basis  Notes or  portions  thereof
tendered  pursuant to an Offer to  Purchase;  (ii) deposit with the Paying Agent
money  sufficient to pay the purchase price of all Notes or portions  thereof so
accepted; and (iii) deliver, or cause to be delivered,  to the Trustee all Notes
or  portions  thereof  so  accepted  together  with  an  Officers'   Certificate
specifying  the Notes or portions  thereof  accepted for payment by the Company.
The Paying Agent shall promptly mail to the Holders of Notes so accepted payment
in an  amount  equal to the  purchase  price,  and the  Trustee  shall  promptly
authenticate  and mail to such Holders a new Note equal in  principal  amount to
any  unpurchased  portion  of the Note  surrendered;  PROVIDED  that  each  Note
purchased and each new Note issued shall be in a principal  amount of Euro 1,000
or an integral multiple thereof.  The Company will publicly announce the results
of an Offer to  Purchase as soon as  practicable  after the  Payment  Date.  The

                                       12
<PAGE>

Trustee shall act as the Paying Agent for an Offer to Purchase. The Company will
comply with Rule 14e-1 under the Exchange Act and any other  securities laws and
regulations  thereunder to the extent such laws and  regulations are applicable,
in the event that the  Company is required to  repurchase  Notes  pursuant to an
Offer to Purchase.

          "Officer" means, with respect to the Company,  (i) the Chairman of the
Board,  the Vice  Chairman  of the Board,  the  President,  the Chief  Executive
Officer, the Chief Financial Officer or a Vice President, and (ii) the Treasurer
or any Assistant  Treasurer,  or the Secretary or any Assistant Secretary of the
Company.

          "Officers'  Certificate"  means a  certificate  signed by one  Officer
listed in clause (i) of the definition  thereof and one Officer listed in clause
(ii) of the definition thereof; PROVIDED, HOWEVER, that any such certificate may
be signed by any two of the  Officers  listed  in clause  (i) of the  definition
thereof  in lieu of being  signed by one  Officer  listed  in clause  (i) of the
definition  thereof  and one  Officer  listed in clause  (ii) of the  definition
thereof.  Each Officers'  Certificate (other than certificates provided pursuant
to TIA Section  314(a)(4))  shall  include the  statements  provided  for in TIA
Section 314(e).

          "Opinion of Counsel"  means a written  opinion signed by legal counsel
who may be an  employee  of or  counsel  to the  Company.  Each such  Opinion of
Counsel shall include the statements provided for in TIA Section 314(e).

          "Participant" means, with respect to DTC, Euroclear or Clearstream,  a
Person who has an account with DTC, Euroclear or Clearstream, respectively (and,
with respect to DTC, shall include Euroclear and Clearstream).

          "Paying Agent" has the meaning provided in Section 2.04,  except that,
for the purposes of Article Eight,  the Paying Agent shall not be the Company or
a Subsidiary of the Company or an Affiliate of any of them).

          "Payment  Date" means the date of purchase,  which shall be a Business
Day no  earlier  than 30 days nor later  than 60 days from the date of notice is
mailed pursuant to an Offer to Purchase.

          "Permanent  Regulation  S Global" has the meaning  provided in Section
2.01.

          "Permitted  Investment"  means (i) an  Investment  in the Company or a
Restricted  Subsidiary  or  a  Person  which  will,  upon  the  making  of  such
Investment,  become a Restricted Subsidiary or be merged or consolidated with or
into or transfer or convey all or substantially all its assets to the Company or
a  Restricted  Subsidiary;  PROVIDED  that such  Person's  primary  business  is
related,  ancillary or  complementary to the businesses of the Company or any of
its Restricted Subsidiaries on the date of such Investment;  (ii) Temporary Cash
Investments;  (iii) payroll,  travel and similar  advances to cover matters that
are expected at the time of such  advances  ultimately to be treated as expenses
in  accordance  with  GAAP;  (iv)  Investments  received  in the  bankruptcy  or
reorganization  of a Person or any exchange of such  Investment  with the issuer
thereof or taken in settlement  of or other  resolution of claims or disputes or
acquired as the result of  foreclosure  of any secured  Investment  and, in each

                                       13
<PAGE>

case, extensions,  modifications and renewal thereof; (v) Investments in prepaid
expenses,  negotiable  instruments  held for collection  and lease,  utility and
worker's  compensation,  performance and other similar  deposits;  (vi) Interest
Rate Agreements and Currency  Agreements  designed solely to protect the Company
or its Restricted Subsidiaries against fluctuations in interest rates or foreign
currency exchange rates; (vii) loans or advances to officers or employees of the
Company or any  Restricted  Subsidiary  that do not in the  aggregate  exceed $1
million at any time  outstanding;  (viii)  investments  consisting of securities
issued by or beneficial  interests in a special  purpose  entity  referred to in
clause (f) of the  definition of "Asset Sale" and which are received in exchange
for assets that are  transferred  by the Company or a Restricted  Subsidiary  to
such special purpose entity and used for the purpose  referred to therein;  (ix)
Investments as a result of  consideration  received in connection  with an Asset
Sale made in compliance  with Section 4.11 hereof,  and (x) securities set aside
at the time of  Incurrence  of  Indebtedness  in order to prefund the payment of
interest on such Indebtedness.

          "Permitted  Joint Venture" means any joint venture between the Company
or any  Restricted  Subsidiary  and (i) any  Person,  other  than a  Subsidiary,
engaged in the  provision  or sale of  telecommunications  services  or (ii) any
Person engaged as an independent sale  representative  of the Company;  PROVIDED
that,  prior to making any Investment in such a Person,  the Company's  Board of
Directors  shall  have  determined  that  such  Investment  fits  the  Company's
strategic plan and is on terms that are fair and reasonable to the Company.

          "Permitted Liens" means (i) Liens for taxes, assessments, governmental
charges or claims not yet subject to penalty or that are being contested in good
faith by  appropriate  legal  proceedings  promptly  instituted  and  diligently
conducted  and for which a reserve or other  appropriate  provision,  if any, as
shall be required in conformity  with GAAP shall have been made;  (ii) statutory
and  common  law  Liens of  landlords  and  carriers,  warehousemen,  mechanics,
suppliers, materialmen, repairmen or other similar Liens arising in the ordinary
course of  business  and with  respect to amounts  not yet  delinquent  or being
contested in good faith by appropriate legal proceedings promptly instituted and
diligently conducted and for which a reserve or other appropriate provision,  if
any, as shall be required in  conformity  with GAAP shall have been made;  (iii)
Liens incurred or deposits made in the ordinary course of business in connection
with  workers'  compensation,  unemployment  insurance and other types of social
security;  (iv) Liens  incurred or deposits  made to secure the  performance  of
tenders,   bids,   leases,   statutory  or  regulatory   obligations,   bankers'
acceptances,  surety and appeal bonds,  government  contracts,  performance  and
return-of-money  bonds and other obligations of a similar nature incurred in the
ordinary  course of  business  (exclusive  of  obligations  for the  payment  of
borrowed money); (v) easements,  rights-of-way,  municipal and zoning ordinances
and similar charges, encumbrances, title defects or other irregularities that do
not materially  interfere with the ordinary course of business of the Company or
any of  its  Restricted  Subsidiaries;  (vi)  Liens  (including  extensions  and
renewals  thereof)  upon  real or  personal  (whether  tangible  or  intangible)
property acquired after the Closing Date; PROVIDED that (a) such Lien is created
solely for the purpose of securing  Indebtedness  Incurred,  in accordance  with
Section 4.03 hereof,  to finance or refinance  the cost  (including  the cost of
design,  development,  acquisition,  construction,   installation,  improvement,
transportation or integration) of the item or related group of items of property
or assets  subject  thereto or the business in which such property or assets are
used and such Lien is created prior to, at the time of or within eighteen months

                                       14
<PAGE>

after the later of the  acquisition,  the  completion  of (except in the case of
refinancing)  construction  or  the  commencement  of  full  operation  of  such
property, (b) the principal amount of the Indebtedness secured by such Lien does
not exceed  100% of such cost and (c) any such Lien shall not extend to or cover
any  property  or assets  other than such item or group of items of  property or
assets and any improvements on such item;  (vii) leases or subleases  granted to
others that do not materially  interfere with the ordinary course of business of
the Company and its  Restricted  Subsidiaries,  taken as a whole;  (viii)  Liens
encumbering  property or assets  under  construction  arising  from  progress or
partial  payments by a customer of the  Company or its  Restricted  Subsidiaries
relating to such  property or assets;  (ix) any interest or title of a lessor in
the property  subject to any  Capitalized  Lease or operating  lease;  (x) Liens
arising from filing  Uniform  Commercial  Code  financing  statements  regarding
leases; (xi) Liens on property of, or on shares of Capital Stock or Indebtedness
of, any Person existing at the time such Person  becomes,  or becomes a part of,
any  Restricted  Subsidiary;  PROVIDED that such Liens do not extend to or cover
any property or assets of the Company or any  Restricted  Subsidiary  other than
the  property  or assets  acquired;  (xii)  Liens in favor of the Company or any
Restricted  Subsidiary;  (xiii)  Liens  arising  from the  rendering  of a final
judgment or order against the Company or any Restricted Subsidiary that does not
give rise to an Event of Default; (xiv) Liens securing reimbursement obligations
with respect to letters of credit that  encumber  documents  and other  property
relating to such letters of credit and the products and proceeds  thereof;  (xv)
Liens in favor of customs and revenue  authorities arising as a matter of law to
secure  payment of customs duties in connection  with the  importation of goods;
(xvi) Liens  encumbering  customary  initial deposits and margin  deposits,  and
other Liens that are within the general parameters customary in the industry and
incurred in the ordinary course of business,  in each case securing Indebtedness
under Interest Rate  Agreements and Currency  Agreements and forward  contracts,
options, future contracts, futures options or similar agreements or arrangements
designed  solely to protect  the Company or any of its  Restricted  Subsidiaries
from  fluctuations  in interest  rates,  currencies or the price of commodities;
(xvii) Liens arising out of conditional  sale, title  retention,  consignment or
similar arrangements for the sale of goods entered into by the Company or any of
its  Restricted  Subsidiaries  in the ordinary  course of business in accordance
with the past practices of the Company and its Restricted  Subsidiaries prior to
the Closing Date;  (xviii) Liens on or sales of  receivables  or other rights to
payment;  (xix) Liens  secured  with assets that have a fair market value not in
excess of 15% of Adjusted  Consolidated  Net Tangible Assets when such Liens are
Incurred; (xx) any extension, renewal, or replacement (or successive extensions,
renewals, or replacements) in whole or in part of Liens described in clauses (i)
through  (xix)  above;  and (xxi) Liens on  securities  that are  referred to in
clause (x) of the definition of Permitted Investments.

          "Permitted Wholesale Consortium" means any Person in which the Company
invests for the principal purpose of leasing or otherwise acquiring transmission
rights with respect to long distance telecommunications; PROVIDED that, prior to
making any Investment in such a Person,  the Company's  Board of Directors shall
have determined  that such  Investment will afford the Company greater  economic
benefits  than it could  otherwise  obtain  from other  sources of  transmission
rights.

          "Person" means an individual, a corporation,  a partnership, a limited
liability company, a joint venture,  an association,  a trust, an unincorporated

                                       15
<PAGE>

organization  or any other entity or  organization,  including a  government  or
political subdivision or an agency or instrumentality thereof.

          "Placement Agreement" has the meaning provided in the recitals to this
Indenture.

          "Preferred  Stock" or  "preferred  stock"  means,  with respect to any
Person,  any and all  shares,  interests,  participation  or  other  equivalents
(however designated, whether voting or non-voting) of such Person's preferred or
preference  stock,  whether  now  outstanding  or issued  after the date of this
Indenture,  including,  without  limitation,  all  series  and  classes  of such
preferred or preference stock.

          "principal"  of a  debt  security,  including  the  Notes,  means  the
principal amount due on the Stated Maturity as shown on such debt security.

          "Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth in Section 2.02(a).

          "Public Equity Offering" means an underwritten primary public offering
of Common Stock of the Company pursuant to an effective  registration  statement
under the Securities Act.

          "QIB" means a "qualified institutional buyer" as defined in Rule 144A.

          "Registrar" has the meaning provided in Section 2.04.

          "Registration   Rights   Agreement"  means  the  Registration   Rights
Agreement,  dated as of April 14, 2000, between the Company and Morgan Stanley &
Co. International Limited, on behalf of itself, Chase Securities Inc. and Credit
Suisse First Boston Corporation relating to the Notes.

          "Registration  Statement"  means  any  registration  statement  of the
Company  that  covers  any  of  the  Exchange  Notes,  and  all  amendments  and
supplements  to  any  such  Registration  Statement,   including  post-effective
amendments,  in each  case  including  the  prospectus  contained  therein,  all
exhibits thereto and all material incorporated by reference therein.

          "Regular Record Date" for the interest payable on any Interest Payment
Date means April 1 or October 1 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date.

          "Regulation S" means Regulation S under the Securities Act.

          "Regulation S Certificated  Notes" has the meaning provided in Section
2.01.

          "Regulation S Global" has the meaning provided in Section 2.01.

          "Responsible  Officer",  when used with respect to the Trustee,  means
any officer of the Trustee with direct  responsibility for the administration of

                                       16
<PAGE>

this  Indenture,  and also means,  with respect to a particular  corporate trust
matter,  any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.

          "Restricted Global" has the meaning provided in Section 2.01.

          "Restricted Payments" has the meaning provided in Section 4.04.

          "Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.

          "Rule 144A" means Rule 144A under the Securities Act.

          "Securities Act" means the Securities Act of 1933, as amended.

          "Significant  Subsidiary"  means,  at any date of  determination,  any
Restricted  Subsidiary that,  together with its  Subsidiaries,  (i) for the most
recent  fiscal  year  of  the  Company,  accounted  for  more  than  10%  of the
consolidated revenues of the Company and its Restricted  Subsidiaries or (ii) as
of the  end of  such  fiscal  year,  was  the  owner  of  more  than  10% of the
consolidated assets of the Company and its Restricted  Subsidiaries,  all as set
forth on the most recently available  consolidated  financial  statements of the
Company for such fiscal year.

          "S&P" means Standard & Poor's Ratings Services and its successors.

          "Stated  Maturity"  means (i) with respect to any debt  security,  the
date  specified  in such  debt  security  as the  fixed  date on which the final
installment  of principal of such debt security is due and payable and (ii) with
respect to any  scheduled  installment  of  principal of or interest on any debt
security,  the date  specified in such debt  security as the fixed date on which
such installment is due and payable.

          "Strategic  Subordinated   Indebtedness"  means  Indebtedness  of  the
Company  Incurred to finance the  acquisition  of a Person engaged in a business
that is related,  ancillary or  complementary  to the business  conducted by the
Company or any of its Restricted Subsidiaries,  which Indebtedness by its terms,
or by  the  terms  of  any  agreement  or  instrument  pursuant  to  which  such
Indebtedness is Incurred,  (i) is expressly made subordinate in right of payment
to the Notes and (ii) provides that no payment of principal, premium or interest
on, or any other payment with respect to, such Indebtedness may be made prior to
the  payment  in full  of all of the  Company's  obligations  under  the  Notes;
PROVIDED that such  Indebtedness  may provide for and be repaid at any time from
the proceeds of a capital  contribution,  the sale of Capital  Stock (other than
Disqualified Stock) of the Company, or other Strategic Subordinated Indebtedness
Incurred after the Incurrence of such Indebtedness.

          "Subsidiary"  means,  with  respect to any  Person,  any  corporation,
association or other business  entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.

                                       17
<PAGE>

          "Temporary  Cash  Investment"  means any of the following:  (i) direct
obligations of the United States of America or any agency thereof or obligations
fully and  unconditionally  guaranteed  by the  United  States of America or any
agency thereof, (ii) time deposit accounts,  eurodollar time deposits,  bankers'
acceptances,  certificates  of deposit and money market  deposits,  in each case
maturing within one year of the date of acquisition thereof and issued by a bank
or trust  company  which is  organized  under the laws of the  United  States of
America,  any state  thereof or any  foreign  country  recognized  by the United
States of  America,  and which bank or trust  company has  capital,  surplus and
undivided profits  aggregating in excess of $50 million (or the foreign currency
equivalent thereof) and has outstanding debt which is rated "A" (or such similar
equivalent rating) or higher by at least one nationally  recognized  statistical
rating  organization  (as defined in Rule 436 under the Securities  Act), or any
money-market  fund  sponsored  by a  registered  broker  dealer or  mutual  fund
distributor,  (iii) repurchase  obligations with a term of not more than 30 days
for  underlying  securities  of the types  described in clause (i) above entered
into with a bank meeting the qualifications described in clause (ii) above, (iv)
commercial paper, maturing not more than one year after the date of acquisition,
issued by a corporation  (other than an Affiliate of the Company)  organized and
in existence  under the laws of the United States of America,  any state thereof
or any foreign country  recognized by the United States of America with a rating
at the time as of which any  investment  therein  is made of "P-2"  (or  higher)
according to Moody's or "A-2" (or higher)  according to S&P, (v) securities with
maturities of one year or less from the date of acquisition  issued or fully and
unconditionally guaranteed by any state, commonwealth or territory of the United
States of America, or by any political  subdivision or taxing authority thereof,
and rated at least "A" by S&P or Moody's,  and (vi) shares or other interests in
an investment  company the assets of which consist  solely of (A)  securities of
the type  described  in clauses (i)  through  (v) above and (B)  mortgage-backed
securities  rated  AAA or the  equivalent  by S&P,  Moody's  or  Fitch  Investor
Services, Inc.

          "Temporary  Regulation  S Global" has the meaning  provided in Section
2.01.

          "TIA" or "Trust  Indenture Act" means the Trust Indenture Act of 1939,
as amended  (15 U.S.  Code  ss.ss.  77aaa-77bbb),  as in effect on the date this
Indenture was executed,  except as provided in Section 9.06; PROVIDED,  HOWEVER,
that,  in the event the Trust  Indenture Act of 1939 is amended after such date,
"TIA" or  "Trust  Indenture  Act"  means,  to the  extent  required  by any such
amendment, the Trust Indenture Act of 1939 as so amended.

          "Trade  Payables"  means,  with  respect to any Person,  any  accounts
payable or any other  indebtedness  or monetary  obligation  to trade  creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary  course of business in connection  with the acquisition of goods
or services.

          "Transaction  Date"  means,  with  respect  to the  Incurrence  of any
Indebtedness by the Company or any of its Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment,  the
date such Restricted Payment is to be made.

                                       18
<PAGE>

          "Trustee" means the party named as such in the first paragraph of this
Indenture  until a successor  replaces it in accordance  with the  provisions of
Article Seven of this Indenture, and thereafter means such successor.

          "United States  Bankruptcy  Code" means the  Bankruptcy  Reform Act of
1978,  as amended  and as  codified in Title 11 of the United  States  Code,  as
amended from time to time hereafter, or any successor federal bankruptcy law.

          "Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination  shall be designated an Unrestricted  Subsidiary by
the Board of Directors in the manner provided below;  and (ii) any Subsidiary of
an Unrestricted Subsidiary.  The Board of Directors may designate any Restricted
Subsidiary  (including  any newly  acquired or newly  formed  Subsidiary  of the
Company)  to be an  Unrestricted  Subsidiary  unless  such  Subsidiary  owns any
Capital  Stock of, or owns or holds any Lien on any  property of, the Company or
any Restricted Subsidiary; PROVIDED that (A) any Guarantee by the Company or any
Restricted  Subsidiary of any Indebtedness of the Subsidiary being so designated
shall be deemed an "Incurrence" of such  Indebtedness and an "Investment" by the
Company or such  Restricted  Subsidiary  (or both, if applicable) at the time of
such  designation;  (B) either (I) the  Subsidiary to be so designated has total
assets of $1,000 or less or (II) if such  Subsidiary  has  assets  greater  than
$1,000, such designation would be permitted under Section 4.04 hereof and (C) if
applicable,  the Incurrence of  Indebtedness  and the Investment  referred to in
clause (A) of this  proviso  would be  permitted  under  Section 4.03 hereof and
Section  4.04 hereof.  The Board of Directors  may  designate  any  Unrestricted
Subsidiary to be a Restricted Subsidiary;  PROVIDED that (i) no Default or Event
of Default  shall have occurred and be continuing at the time of or after giving
effect  to  such  designation  and  (ii)  all  Liens  and  Indebtedness  of such
Unrestricted Subsidiary outstanding immediately after such designation would, if
Incurred at such time,  have been  permitted to be Incurred (and shall be deemed
to have been Incurred) for all purposes of this Indenture.  Any such designation
by the Board of Directors  shall be evidenced to the Trustee by promptly  filing
with  the  Trustee  a  copy  of the  Board  Resolution  giving  effect  to  such
designation  and an  Officers'  Certificate  certifying  that  such  designation
complied with the foregoing provisions.

          "U.S. Certificated Notes" has the meaning provided in Section 2.01.

          "U.S. Notes" has the meaning provided in Section 2.01.

          "U.S.  Paying Agent" means The Bank of New York and any successor U.S.
Paying Agent.

          "U.S.  Person" has the meaning  ascribed thereto in Rule 902 under the
Securities Act.

          "Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.

                                       19
<PAGE>

          "Wholly  Owned" means,  with respect to any  Subsidiary of any Person,
the ownership of all of the outstanding  Capital Stock of such Subsidiary (other
than any  director's  qualifying  shares or  Investments  by  foreign  nationals
mandated  by  applicable  law)  by  such  Person  or one or  more  Wholly  Owned
Subsidiaries of such Person.

          SECTION  1.02.  INCORPORATION  BY  REFERENCE OF TRUST  INDENTURE  ACT.
Whenever  this  Indenture  refers to a provision  of the TIA,  the  provision is
incorporated  by reference in and made a part of this  Indenture.  The following
TIA terms used in this Indenture have the following meanings:

          "indenture securities" means the Notes;

          "indenture security holder" means a Holder or a Noteholder;

          "indenture to be qualified" means this Indenture;

          "indenture trustee" or "institutional trustee" means the Trustee; and

          "obligor" on the indenture  securities  means the Company or any other
obligor on the Notes.

          All other TIA terms  used in this  Indenture  that are  defined by the
TIA,  defined by TIA  reference  to another  statute or defined by a rule of the
Commission and not otherwise  defined herein have the meanings  assigned to them
therein.

          SECTION  1.03.  RULES OF  CONSTRUCTION.  Unless the context  otherwise
requires:

          (i) a term has the meaning assigned to it;

          (ii) an accounting term not otherwise defined has the meaning assigned
     to it in accordance with GAAP;

          (iii) "or" is not exclusive;

          (iv) words in the singular include the plural, and words in the plural
     include the singular;

          (v) provisions apply to successive events and transactions;

          (vi)  "herein,"  "hereof"  and other words of similar  import refer to
     this  Indenture as a whole and not to any  particular  Article,  Section or
     other subdivision; and

          (vii) all  references  to Sections  or  Articles  refer to Sections or
     Articles of this Indenture unless otherwise indicated.

                                       20
<PAGE>

                                   ARTICLE TWO
                                    THE NOTES

          SECTION 2.01. FORM AND DATING. The Notes and the Trustee's certificate
of  authentication  with  respect  thereto  shall be  substantially  in the form
annexed hereto as Exhibit A, in the case of a Restricted  Global,  Exhibit B, in
the  case of the  Regulation  S  Global,  and  Exhibit  C, in the case of a U.S.
Certificated  Note. The Notes may have such appropriate  insertions,  omissions,
substitutions  and  other  variations  as are  required  or  permitted  by  this
Indenture and may have letters,  notations,  legends or endorsements required by
law,  stock  exchange  agreements to which the Company is subject or usage.  Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note. The Company shall approve
the form of the Notes and any notation, legend or endorsement on the Notes. Each
Note shall be dated the date of its authentication.

          The terms and  provisions  contained in the form of the Notes  annexed
hereto as Exhibits A, B and C shall constitute, and are hereby expressly made, a
part of this  Indenture.  Each of the Company and the Trustee,  by its execution
and delivery of this Indenture,  expressly agrees to the terms and provisions of
the Notes applicable to it and to be bound thereby.

          Notes  offered  and sold in  reliance  on Rule  144A  shall be  issued
initially in the form of two or more permanent  global Notes in registered form,
substantially in the form set forth in Exhibit A (the "RESTRICTED GLOBALS"). The
Restricted Global initially offered and sold in reliance on Rule 144A to holders
electing  settlement through DTC (the "DTC RULE 144A GLOBAL") shall be deposited
on behalf of the holders of the Notes represented  thereby with the Trustee,  at
its New York office,  as  custodian  for DTC,  duly  executed by the Company and
authenticated by the Trustee as provided herein. The Restricted Global initially
offered and sold in reliance on Rule 144A to holders electing settlement through
Euroclear or  Clearstream  (the  "EUROPEAN  144A GLOBAL")  shall be deposited on
behalf  of  the  holders  of the  Notes  represented  thereby  with  the  Common
Depositary,  as common depositary for Euroclear and Clearstream,  and registered
in the name of the  Common  Depositary  or its  nominee,  duly  executed  by the
Company and  authenticated by the Trustee as provided herein,  for credit to the
accounts  of  Euroclear  and  Clearstream  (or such other  accounts  as they may
direct).  The DTC Rule 144A Global,  the European Rule 144A Global and all other
Notes  evidencing the debt, or any portion of the debt,  initially  evidenced by
such Rule 144A  Global or  European  Rule 144A  Global,  shall  collectively  be
referred to herein as the "U.S.  NOTES." The aggregate  principal  amount of the
DTC Rule  144A  Global  may  from  time to time be  increased  or  decreased  by
adjustments made on the records of the Registrar, as hereinafter provided (or by
the issue of a further DTC Rule 144A Global), in connection with a corresponding
decrease or increase in the aggregate principal amount of the European Rule 144A

                                       21
<PAGE>

Global or the Regulation S Global or in consequence of the issue of Certificated
Notes or additional U.S. Notes, as hereinafter provided. The aggregate principal
amount of the  European  Rule 144A Global may from time to time be  increased or
decreased by  adjustments  made on the records of the  Registrar as  hereinafter
provided (or by the issue of a further European Rule 144A Global), in connection
with a corresponding  decrease or increase in the aggregate  principal amount of
any of the DTC Rule 144A Global or the  Regulation S Global or in consequence of
the  issue  of  Certificated  Notes or  additional  U.S.  Notes  as  hereinafter
provided.

          Notes  offered  and  sold in  offshore  transactions  in  reliance  on
Regulation  S shall be  issued  initially  in the form of one or more  temporary
global Notes in registered form substantially in the form set forth in Exhibit B
(the "TEMPORARY REGULATION S GLOBAL") registered in the name of a nominee of the
Depository for the accounts of Euroclear and Clearstream, deposited on behalf of
the purchasers of the Notes represented thereby with the Common Depositary, duly
executed  by the  Company  and  authenticated  by  the  Trustee  as  hereinafter
provided.  At any time  following May 31, 2000,  upon receipt by the Trustee and
the Company of a certificate  substantially in the form of Exhibit D hereto, one
or more permanent global Notes in registered form  substantially in the form set
forth in Exhibit B (the "PERMANENT  REGULATION S GLOBAL" and,  together with the
Temporary  Regulation S Global,  the "REGULATION S GLOBAL") duly executed by the
Company  and  authenticated  by the  Trustee as  hereinafter  provided  shall be
deposited  with the  Common  Depositary  which  shall  reflect  on its books and
records  the  date and a  decrease  in the  principal  amount  of the  Temporary
Regulation S Global in an amount equal to the principal amount of the beneficial
interest  in the  Temporary  Regulation  S  Global  transferred.  The  aggregate
principal  amount of a Regulation S Global may from time to time be increased or
decreased by  adjustments  made in the records of the Trustee,  as custodian for
the Depository or its nominee, as herein provided.

          The provisions of the "Operating  Procedures of the Euroclear  System"
and "Terms and  Conditions  Governing  Use of  Euroclear"  of Euroclear and "The
General  Terms  and  Conditions  of  Clearstream"  and  "Customer  Handbook"  of
Clearstream  shall be  applicable to interests in the Global Notes that are held
by Agent Members through Euroclear and Clearstream.

          Notes which are  transferred  to  Institutional  Accredited  Investors
which are not QIBs (excluding  Non-U.S.  Persons) shall be issued in the form of
permanent  certificated  Notes in registered form in substantially  the form set
forth in Exhibit C (the "U.S.  CERTIFICATED  NOTES").  Notes issued  pursuant to
Section  2.07 in exchange for  interests in the  Regulation S Global shall be in
the form of certificated  Notes in registered form substantially in the form set
forth in  Exhibit  C (the  "REGULATION  S  CERTIFICATED  NOTES").  Notes  issued
pursuant to Section 2.07 in exchange for interests in a Restricted  Global shall
be in the form of the U.S. Certificated Note.

          The Regulation S Certificated  Notes and the U.S.  Certificated  Notes
are sometimes  collectively  referred to herein as the "CERTIFICATED NOTES." The
DTC Rule 144A Global,  the European Rule 144A Global and the Regulation S Global
are sometimes collectively herein referred to as the "GLOBAL NOTES."

          The definitive Notes shall be typed, printed, lithographed or engraved
or produced by any  combination of these methods or may be produced in any other
manner permitted by the rules of any securities  exchange on which the Notes may
be listed,  all as determined by the officers executing such Notes, as evidenced
by their execution of such Notes.

                                       22
<PAGE>

          SECTION 2.02. RESTRICTIVE LEGENDS. (a) NOTE LEGENDS.  Unless and until
a Note is exchanged for an Exchange Note or otherwise  disposed of in connection
with an effective  Registration  Statement  pursuant to the Registration  Rights
Agreement,  (i) each Restricted Global and U.S. Certificated Note shall bear the
legend set forth below on the face thereof and (ii) each Temporary  Regulation S
Global and each  Regulation S Certificated  Note shall bear the legend set forth
below on the face  thereof  until at least 41 days  after the  Closing  Date and
receipt by the  Company and the Trustee of a  certificate  substantially  in the
form of Exhibit D hereto.

     THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
     AMENDED  (THE  "SECURITIES   ACT"),  OR  ANY  STATE  SECURITIES  LAWS,  AND
     ACCORDINGLY,  MAY NOT BE OFFERED,  SOLD,  PLEDGED OR OTHERWISE  TRANSFERRED
     WITHIN THE UNITED  STATES OR TO, OR FOR THE  ACCOUNT  OR BENEFIT  OF,  U.S.
     PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING  SENTENCE.  BY ITS ACQUISITION
     HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
     BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES  ACT) OR (B) IT IS NOT
     A U.S.  PERSON AND IS  ACQUIRING  THIS NOTE IN AN OFFSHORE  TRANSACTION  IN
     COMPLIANCE  WITH RULE 903 OF  REGULATION  S UNDER THE  SECURITIES  ACT; (2)
     AGREES THAT IT WILL NOT,  WITHIN THE TIME PERIOD REFERRED TO IN RULE 144(k)
     AS IN EFFECT ON THE DATE OF SUCH  TRANSFER,  RESELL OR  OTHERWISE  TRANSFER
     THIS NOTE EXCEPT (A) TO VIATEL,  INC. OR ANY SUBSIDIARY  THEREOF,  (B) TO A
     QUALIFIED  INSTITUTIONAL  BUYER IN  COMPLIANCE  WITH  RULE  144A  UNDER THE
     SECURITIES ACT, (C) TO AN INSTITUTIONAL  ACCREDITED INVESTOR THAT, PRIOR TO
     SUCH TRANSFER,  FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
     REPRESENTATIONS  AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF
     THIS NOTE (THE FORM OF WHICH  LETTER CAN BE OBTAINED  FROM THE TRUSTEE) AND
     IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES OF
     LESS THAN EURO 100,000,  AN OPINION OF COUNSEL ACCEPTABLE TO VIATEL,  INC.,
     THAT SUCH  TRANSFER IS IN  COMPLIANCE  WITH THE  SECURITIES  ACT,  (D) TO A
     PERSON  OUTSIDE THE UNITED STATES IN AN OFFSHORE  TRANSACTION IN COMPLIANCE
     WITH  REGULATION S UNDER THE SECURITIES  ACT, (E) PURSUANT TO THE EXEMPTION
     FROM  REGISTRATION  PROVIDED  BY RULE  144  UNDER  THE  SECURITIES  ACT (IF
     AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
     SECURITIES  ACT AND (3) AGREES THAT IT WILL  DELIVER TO EACH PERSON TO WHOM
     THIS NOTE IS GIVEN A NOTICE  SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
     CONNECTION  WITH ANY TRANSFER OF THIS NOTE WITHIN THE TIME PERIOD  REFERRED
     TO  ABOVE,  THE  HOLDER  MUST  CHECK THE  APPROPRIATE  BOX SET FORTH ON THE
     REVERSE  HEREOF  RELATING  TO THE MANNER OF SUCH  TRANSFER  AND SUBMIT THIS
     CERTIFICATE TO THE TRUSTEE.  IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
     ACCREDITED

                                       23
<PAGE>

     INVESTOR,  THE HOLDER MUST, PRIOR TO SUCH TRANSFER,  FURNISH TO EACH OF THE
     TRUSTEE AND  VIATEL,  INC.  SUCH  CERTIFICATIONS,  LEGAL  OPINIONS OR OTHER
     INFORMATION  AS SUCH  PERSONS MAY  REASONABLY  REQUIRE TO CONFIRM THAT SUCH
     TRANSFER IS BEING MADE  PURSUANT TO AN EXEMPTION  FROM, OR IN A TRANSACTION
     NOT SUBJECT TO, THE  REGISTRATION  REQUIREMENTS  OF THE SECURITIES  ACT. AS
     USED HEREIN,  THE TERMS "OFFSHORE  TRANSACTION",  "UNITED STATES" AND "U.S.
     PERSON"  HAVE  THE  MEANINGS  GIVEN  TO THEM  BY  REGULATION  S  UNDER  THE
     SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
     REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE  FOREGOING
     RESTRICTIONS.

          (b)   RESTRICTED GLOBAL NOTE LEGEND. The DTC Rule 144A Global, whether
or not an  Exchange  Note,  shall  also  bear the  following  legend on the face
thereof:

     UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
     DEPOSITORY  TRUST COMPANY TO VIATEL,  INC. OR ITS AGENT FOR REGISTRATION OF
     TRANSFER,  EXCHANGE OR PAYMENT,  AND ANY NOTE ISSUED IS  REGISTERED  IN THE
     NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED  BY AN  AUTHORIZED
     REPRESENTATIVE  OF THE DEPOSITORY  TRUST COMPANY (AND ANY PAYMENT HEREON IS
     MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
     REPRESENTATIVE  OF THE DEPOSITORY TRUST COMPANY),  ANY TRANSFER,  PLEDGE OR
     OTHER USE HEREOF  FOR VALUE OR  OTHERWISE  BY OR TO ANY PERSON IS  WRONGFUL
     INASMUCH  AS THE  REGISTERED  OWNER  HEREOF,  CEDE & CO.,  HAS AN  INTEREST
     HEREIN.

     TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO  TRANSFERS IN WHOLE,  BUT
     NOT IN PART,  TO NOMINEES  OF CEDE & CO. OR TO A SUCCESSOR  THEREOF OR SUCH
     SUCCESSOR'S  NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
     LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE  RESTRICTIONS SET FORTH IN
     SECTION 2.08 OF THE INDENTURE.

          (c)   REGULATION  S GLOBAL NOTE LEGEND.  Each European 144A Global and
Regulation  S Global,  whether  or not an  Exchange  Note,  shall  also bear the
following legend on the face thereof:

     THIS NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE  GOVERNING
     THIS NOTE) IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF,  AND
     IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY  CIRCUMSTANCES  EXCEPT THAT (1)
     THE TRUSTEE MAY MAKE SUCH NOTATIONS  HEREON AS MAY BE REQUIRED  PURSUANT TO
     SECTION  2.08 OF THE  INDENTURE,  (2) THIS GLOBAL NOTE MAY BE  EXCHANGED IN

                                       24
<PAGE>

     WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.07 OF THE  INDENTURE,  (3) THIS
     GLOBAL NOTE MAY BE  DELIVERED TO THE TRUSTEE FOR  CANCELLATION  PURSUANT TO
     SECTION 2.12 OF THE  INDENTURE AND (4) THIS GLOBAL NOTE MAY BE DELIVERED TO
     A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUER.

          SECTION 2.03. EXECUTION, AUTHENTICATION AND DENOMINATIONS.  Subject to
Article Four, the aggregate principal amount of Notes (including Exchange Notes)
which may be authenticated and delivered under this Indenture is unlimited.  The
Notes shall be executed by two Officers of the  Company,  by facsimile or manual
signature, in the name and on behalf of the Company.

          If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee or authenticating agent authenticates the Note, the Note
shall be valid nevertheless.

          A Note shall not be valid  until the Trustee or  authenticating  agent
manually  signs the  certificate  of  authentication  on the Note. The signature
shall be  conclusive  evidence that the Note has been  authenticated  under this
Indenture.

          At any  time  and  from  time  to time  after  the  execution  of this
Indenture,  the Trustee or an  authenticating  agent  shall,  upon  receipt of a
Company Order,  authenticate for original issue Notes in the aggregate principal
amount  specified in such Company  Order.  Such Company  Order shall specify the
amount of Notes to be authenticated,  the date on which the issue of Notes is to
be authenticated  and, in case of an issuance of Notes pursuant to Section 2.15,
shall certify that such issuance is in compliance with Article Four.

          The Trustee may appoint an authenticating agent reasonably  acceptable
to the  Company  to  authenticate  Notes.  Unless  limited  by the terms of such
appointment, an authenticating agent may authenticate Notes whenever the Trustee
may do so. Each  reference in this  Indenture to  authentication  by the Trustee
includes  authentication by such authenticating  agent. An authenticating  agent
has the same rights as an Agent to deal with the Company or an  Affiliate of the
Company.

          The Notes shall be issuable only in registered form without coupons in
principal amount of Euro 1,000 and any integral multiple of Euro 1,000 in excess
thereof.

          SECTION 2.04.  REGISTRAR AND PAYING AGENT.  The Company shall maintain
an office or agency in the City of New York  where  Notes may be  presented  for
registration of transfer or for exchange (the "REGISTRAR"),  an office or agency
in the City of New York and in the City of London,  United  Kingdom  and, in the
event  the Notes are  included  on the  Frankfurt  over-the-counter  market,  in
Frankfurt where Notes may be presented for payment (the "PAYING AGENT"),  and an
office or agency where  notices and demands to or upon the Company in respect of
the Notes and this  Indenture  may be served,  which shall be in the City of New
York and, in the event the Notes are included on the

                                       25
<PAGE>

Frankfurt  over-the-counter  market,  in Frankfurt.  The Company shall cause the
Registrar  to keep a register of the Notes and of their  transfer  and  exchange
(the "NOTE REGISTER"). The Company may have one or more co-Registrars and one or
more additional Paying Agents.

          The Company shall enter into an appropriate  agency agreement with any
Agent  not a  party  to  this  Indenture.  The  agreement  shall  implement  the
provisions of this Indenture  that relate to such Agent.  The Company shall give
prompt  written  notice to the Trustee of the name and address of any such Agent
and any change in the address of such Agent.  If the Company fails to maintain a
Registrar,  Paying Agent  and/or  agent for service of notices and demands,  the
Trustee  shall act as such  Registrar,  Paying Agent and/or agent for service of
notices and demands for so long as such failure shall continue.  The Company may
remove any Agent upon  written  notice to such Agent and the  Trustee;  PROVIDED
that no such  removal  shall become  effective  until (i) the  acceptance  of an
appointment  by a successor  Agent to such Agent as evidenced by an  appropriate
agency  agreement  entered  into by the  Company  and such  successor  Agent and
delivered  to the Trustee or (ii)  notification  to the Trustee that the Trustee
shall  serve  as such  Agent  until  the  appointment  of a  successor  Agent in
accordance with clause (i) of this proviso.  The Company,  any Subsidiary of the
Company,  or any Affiliate of any of them may act as Paying Agent,  Registrar or
co-Registrar, and/or agent for service of notice and demands; PROVIDED, HOWEVER,
that neither the Company, a Subsidiary of the Company nor an Affiliate of any of
them shall act as Paying Agent in connection with the defeasance of the Notes or
the discharge of this Indenture under Article Eight.

          The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating  agent and agent for service of notice and  demands.  The Company
initially  appoints the Euro Paying  Agent,  as Paying Agent with respect to the
European 144A Global and  Regulation S Global.  If, at any time,  the Trustee is
not the  Registrar,  the  Registrar  shall make  available  to the Trustee on or
before  each  Interest  Payment  Date and at such other times as the Trustee may
reasonably request, the names and addresses of the Holders as they appear in the
Note Register.

          SECTION  2.05.  PAYING  AGENT TO HOLD  MONEY IN TRUST.  Not later than
10:00 a.m. New York City time or 10:00 a.m. London time, as applicable,  on each
due date of the  principal,  premium,  if any,  or  interest  on any Notes,  the
Company  shall  deposit  with the  relevant  Paying  Agent money in  immediately
available funds sufficient to pay such principal,  premium,  if any, or interest
so becoming due. The Company shall require each Paying Agent, if any, other than
the Trustee to agree in writing  that such Paying  Agent shall hold in trust for
the benefit of the Holders or the Trustee all money held by the Paying Agent for
the payment of principal of, premium,  if any, or interest on the Notes (whether
such  money  has been paid to it by the  Company  or any  other  obligor  on the
Notes),  and that such  Paying  Agent shall  promptly  notify the Trustee of any
default by the  Company  (or any other  obligor on the Notes) in making any such
payment.  The  Company at any time may  require a Paying  Agent to pay all money
held by it to the Trustee and account for any funds  disbursed,  and the Trustee
may at any time during the  continuance  of any payment  default,  upon  written
request to a Paying Agent, require such Paying Agent to pay all money held by it
to the Trustee and to account for any funds disbursed. Upon doing so, the Paying

                                       26
<PAGE>

Agent shall have no further liability for the money so paid over to the Trustee.
If the Company or any  Subsidiary of the Company or any Affiliate of any of them
acts as Paying  Agent,  it will, on or before each due date of any principal of,
premium,  if any,  or interest  on the Notes,  segregate  and hold in a separate
trust fund for the benefit of the Holders a sum of money  sufficient to pay such
principal,  premium, if any, or interest so becoming due until such sum of money
shall be paid to such  Holders or  otherwise  disposed  of as  provided  in this
Indenture,  and will promptly notify the Trustee of its action or failure to act
as required by this Section 2.05.

          SECTION 2.06.  TRANSFER AND  EXCHANGE.  The Notes are issuable only in
registered  form.  A Holder may  transfer a Note by written  application  to the
Registrar  stating the name of the proposed  transferee and otherwise  complying
with the terms of this Indenture.  No such transfer shall be effected until, and
such transferee  shall succeed to the rights of a Holder only upon  registration
of the transfer by the Registrar in the Note Register. Prior to the registration
of any transfer by a Holder as provided herein,  the Company,  the Trustee,  and
any agent of the Company or the Trustee shall treat the Person in whose name the
Note is registered as the owner thereof for all purposes whether or not the Note
shall be overdue, and neither the Company, the Trustee, nor any such agent shall
be affected by notice to the contrary.  Furthermore, any Holder of a Global Note
shall,  by  acceptance of such Global Note,  agree that  transfers of beneficial
interests in such Global Note may be effected  only through a book-entry  system
maintained by the Depository (or its agent),  and that ownership of a beneficial
interest  in the Note shall be required to be  reflected  in a book entry.  When
Notes are  presented  to the  Registrar  or a  co-Registrar  with a  request  to
register the transfer or to exchange them for an equal principal amount of Notes
of other authorized  denominations  (including an exchange of Notes for Exchange
Notes),  the  Registrar  shall  register  the  transfer or make the  exchange as
requested if its  requirements for such  transactions are met;  PROVIDED that no
exchanges of Notes for Exchange Notes shall occur until a Registration Statement
shall have been declared effective by the Commission and that any Notes that are
exchanged  for  Exchange  Notes shall be  cancelled  by the  Trustee.  To permit
registrations   of  transfers  and  exchanges  in  accordance  with  the  terms,
conditions and  restrictions  hereof,  the Company shall execute and the Trustee
shall authenticate Notes at the Registrar's  request. No service charge shall be
made to any Holder for any registration of transfer or exchange or redemption of
the Notes,  but the Company may require payment of a sum sufficient to cover any
transfer tax or similar  governmental  charge  payable in  connection  therewith
(other than any such transfer taxes or other similar governmental charge payable
upon transfers, exchanges or redemptions pursuant to Section 2.11, 4.11, 4.12 or
9.04).

          SECTION  2.07.  BOOK-ENTRY  PROVISIONS  FOR  GLOBAL  NOTES.  (a)  Each
Restricted  Global and Regulation S Global  initially shall (i) be registered in
the  name  of the  Depository  for  such  Global  Note  or the  nominee  of such
Depository,  (ii)  be  delivered  to the  Trustee  as  custodian  or the  Common
Depositary,  as  applicable,  for such  Depository and (iii) bear legends as set
forth in Section 2.02 hereof.

          Members of, or Participants in, the Depository ("AGENT MEMBERS") shall
have no rights  under this  Indenture  with  respect to any Global  Note held on

                                       27
<PAGE>

their behalf by the  Depository,  or the Trustee as its  custodian or the Common
Depositary,  as applicable,  or under any Global Note, and the Depository may be
treated by the Company,  the Trustee and any agent of the Company or the Trustee
as the  absolute  owner  of  such  Global  Note  for  all  purposes  whatsoever.
Notwithstanding  the foregoing,  nothing  herein shall prevent the Company,  the
Trustee or any agent of the  Company or the Trustee  from  giving  effect to any
written certification,  proxy or other authorization furnished by the Depository
or impair,  as between the Depository  and its Agent  Members,  the operation of
customary  practices  governing the exercise of the rights of a beneficial owner
of any Note.

          (b) Transfers of a Global Note shall be limited to transfers of such
Global Note in whole,  but not in part,  to the  Depository,  its  successors or
their respective nominees,  or transfers between the Depository for the DTC Rule
144A Global and the  Depository  for the European  144A Global and  Regulation S
Global.  Transfers  of interests in one Global Note to parties who will hold the
interests  through the same Global Note will be effected in the  ordinary way in
accordance with the respective rules and operating  procedures of DTC, Euroclear
or  Clearstream,  as the case may be, and the provisions of Section 2.08 hereof.
In addition, U.S. Certificated Notes or Regulation S Certificated Notes shall be
transferred to all beneficial owners in exchange for their beneficial  interests
in a  Restricted  Global  or a  Regulation  S Global,  respectively,  if (i) the
Depository  with  respect to such Global  Notes  notifies the Company that it is
unwilling or unable to continue as Depository for the  Restricted  Global or the
Regulation  S Global,  as the case may be,  and a  successor  depository  is not
appointed  by the  Company  within  90 days of such  notice  or (ii) an Event of
Default has occurred and is continuing  and the Registrar has received a request
to the foregoing effect from the Depository or the Trustee.

          (c) Any  beneficial  interest  in one of the  Global  Notes  that is
transferred to a Person who takes delivery in the form of an interest in another
Global Note will, upon transfer, cease to be an interest in such Global Note and
become an interest in such other Global Note and,  accordingly,  will thereafter
be subject to all transfer restrictions, if any, and other procedures applicable
to beneficial interests in such other Global Note for as long as it remains such
an interest.

          (d) In  connection  with any transfer  pursuant to paragraph  (b) of
this  Section  2.07 of a portion of the  beneficial  interests  in a  Restricted
Global or  Regulation  S Global to  beneficial  owners who are  required to hold
Certificated  Notes,  the  Registrar  shall reflect on its books and records the
date and a  decrease  in the  principal  amount  of such  Restricted  Global  or
Regulation S Global in an amount equal to the principal amount of the beneficial
interest in such Restricted Global or Regulation S Global to be transferred, and
the Company shall execute,  and the Trustee shall authenticate and deliver,  one
or more U.S.  Certificated Notes or Regulation S Certificated Notes, as the case
may be, of like tenor and amount.

          (e) In connection with the transfer of all the beneficial  interests
in a Restricted  Global or Regulation S Global to beneficial  owners pursuant to
paragraph  (b) of this  Section  2.07,  the  Restricted  Global or  Regulation S
Global, as the case may be, shall be deemed to be surrendered to the Trustee for
cancellation,  and the Company shall execute, and the Trustee shall authenticate
and deliver,  to each beneficial  owner identified by the Depository in exchange
for its beneficial  interest in the Restricted Global or Regulation S Global, as

                                       28
<PAGE>

the case may be, an equal aggregate principal amount of U.S.  Certificated Notes
or  Regulation  S  Certificated  Notes,  as  the  case  may  be,  of  authorized
denominations.

          (f) Any U.S. Certificated Note delivered in exchange for an interest
in a Restricted  Global  pursuant to  paragraph  (b), (d) or (e) of this Section
2.07 shall,  except as otherwise  provided by  paragraphs  (f)(i)(x)  and (d) of
Section 2.08 hereof, bear the legend regarding transfer restrictions  applicable
to the U.S. Certificated Note set forth in Section 2.02.

          (g) Any  Regulation S Certificated Note delivered in exchange for an
interest in a Regulation S Global  pursuant to paragraph (b), (d) or (e) of this
Section 2.07 shall, except as otherwise provided by paragraphs (f)(i)(x) and (d)
of  Section  2.08  hereof,  bear  the  legend  regarding  transfer  restrictions
applicable  to the  Regulation  S  Certificated  Note set forth in Section  2.02
hereof.

          (h) The  registered  holder of a Global  Note may grant  proxies and
otherwise  authorize  any Person,  including  Agent Members and Persons that may
hold  interests  through  Agent  Members,  to take any action  which a Holder is
entitled to take under this Indenture or the Notes.

          (i) QIBs  that are  beneficial  owners of interests in a Global Note
may receive Certificated Notes (which shall bear the Private Placement Legend if
required by Section  2.02) in  accordance  with the  procedures  of the relevant
Depository.  In connection  with the execution,  authentication  and delivery of
such Certificated  Notes, the Registrar shall reflect on its books and records a
decrease  in the  principal  amount of the  relevant  Global  Note  equal to the
principal  amount of such  Certificated  Notes and the Company shall execute and
the Trustee shall authenticate and deliver one or more Certificated Notes having
an equal aggregate principal amount.

          (j) All Notes issued upon any transfer or exchange of Notes shall be
valid obligations of the Company,  evidencing the same debt, and entitled to the
same benefits under this Indenture,  as the Notes surrendered upon such transfer
or exchange.

          SECTION 2.08. SPECIAL TRANSFER PROVISIONS.  Unless and until a Note is
exchanged  for an Exchange  Note in  connection  with an effective  Registration
Statement  pursuant  to  the  Registration   Rights  Agreement,   the  following
provisions shall apply:

          (a) TRANSFERS  TO QIBS.  The following  provisions  shall apply with
respect to the registration of any proposed transfer of a U.S. Certificated Note
or an interest in a Restricted Global to a QIB (excluding Non-U.S. Persons):

          (i) If the Note to be  transferred  consists of (x) U.S.  Certificated
     Notes,  the Registrar shall register the transfer if such transfer is being
     made by a proposed  transferor  who has checked the box provided for on the
     form  of  Note  stating,  or has  otherwise  advised  the  Company  and the
     Registrar in writing,  that the sale has been made in  compliance  with the
     provisions  of Rule 144A to a transferee  who has signed the  certification

                                       29
<PAGE>

     provided  for on the form of Note  stating,  or has  otherwise  advised the
     Company and the Registrar in writing,  that it is  purchasing  the Note for
     its own  account or an account  with  respect  to which it  exercises  sole
     investment  discretion and that it and any such account is a QIB within the
     meaning  of Rule  144A,  and is aware  that the sale to it is being made in
     reliance  on  Rule  144A  and  acknowledges   that  it  has  received  such
     information regarding the Company as it has requested pursuant to Rule 144A
     or has determined not to request such information and that it is aware that
     the  transferor is relying upon its foregoing  representations  in order to
     claim  the  exemption  from  registration  provided  by Rule 144A or (y) an
     interest in a  Restricted  Global,  the  transfer of such  interest  may be
     effected  only through the  book-entry  system  maintained  by the relevant
     Depository.

          (ii) If the proposed transferee is an Agent Member, and the Note to be
     transferred  consists  of U.S.  Certificated  Notes,  upon  receipt  by the
     Registrar of the documents referred to in clause (i) and instructions given
     in  accordance   with  the  relevant   Depository's   and  the  Registrar's
     procedures,  the Registrar  shall reflect on its books and records the date
     and an increase in the principal amount of the relevant  Restricted  Global
     in an amount equal to the principal amount of the U.S.  Certificated  Notes
     to be transferred,  and the Trustee shall cancel the  Certificated  Note so
     transferred.

          (b) TRANSFERS  OF INTERESTS IN  REGULATION S GLOBAL OR  REGULATION S
CERTIFICATED  NOTES TO U.S. PERSONS.  The following  provisions shall apply with
respect to any transfer of  interests  in a Regulation S Global or  Regulation S
Certificated Notes to U.S. Persons:

          (i)  prior to the  removal  of the  Private  Placement  Legend  from a
     Regulation S Global or a Regulation S Certificated Note pursuant to Section
     2.02, the Registrar shall refuse to register such transfer; and

          (ii) after such removal,  the Registrar shall register the transfer of
     any such Note without requiring any additional certification.

          (c) TRANSFERS  TO  NON-U.S.  PERSONS  AT  ANY  TIME.  The  following
provisions  shall  apply with  respect to any  transfer  of a Note to a Non-U.S.
Person:

          (i) The Registrar shall register any proposed transfer to any Non-U.S.
     Person  if the Note to be  transferred  is a U.S.  Certificated  Note or an
     interest  in a  Restricted  Global  only  upon  receipt  of  a  certificate
     substantially in the form of Exhibit E from the proposed transferor.

          (ii) (a) If the  proposed  transferor  is an Agent  Member  holding  a
     beneficial  interest in a Restricted Global,  upon receipt by the Registrar
     of (x) the  documents  required by paragraph  (i) and (y)  instructions  in
     accordance with the relevant  Depository's and the Registrar's  procedures,
     the  Registrar  shall  reflect  on its  books  and  records  the date and a
     decrease in the  principal  amount of such  Restricted  Global in an amount
     equal to the principal amount of the beneficial  interest in the Restricted
     Global to be  transferred,  and (b) if the proposed  transferee is an Agent
     Member,  upon receipt by the Registrar of instructions  given in accordance

                                       30
<PAGE>

     with  the  relevant  Depository's  and  the  Registrar's  procedures,   the
     Registrar  shall  reflect on its books and records the date and an increase
     in the principal  amount of such  Regulation S Global in an amount equal to
     the  principal  amount  of the U.S.  Certificated  Notes or the  Restricted
     Global, as the case may be, to be transferred, and the Trustee shall cancel
     the Certificated Note, if any, so transferred or decrease the amount of the
     relevant Restricted Global.

          (d) PRIVATE  PLACEMENT  LEGEND.  Upon the  registration of transfer,
exchange or replacement of Notes not bearing the Private Placement  Legend,  the
Registrar  shall  deliver Notes that do not bear the Private  Placement  Legend.
Upon the registration of transfer,  exchange or replacement of Notes bearing the
Private Placement  Legend,  the Registrar shall deliver only Notes that bear the
Private  Placement  Legend unless either (i) the Private  Placement Legend is no
longer  required by Section 2.02 or (ii) there is delivered to the  Registrar an
Opinion of Counsel reasonably satisfactory to the Company and the Trustee to the
effect that  neither  such legend nor the related  restrictions  on transfer are
required in order to maintain  compliance  with the provisions of the Securities
Act.

          (e) GENERAL.  By its  acceptance  of any Note  bearing  the  Private
Placement  Legend,  each Holder of such a Note  acknowledges the restrictions on
transfer of such Note set forth in this  Indenture and in the Private  Placement
Legend and  agrees  that it will  transfer  such Note only as  provided  in this
Indenture.  The Registrar  shall not register a transfer of any Note unless such
transfer  complies with the  restrictions  on transfer of such Note set forth in
this  Indenture.  In connection  with any transfer of Notes to an  Institutional
Accredited  Investor,  each  Holder  agrees  by its  acceptance  of the Notes to
furnish the  Registrar or the Company  such  certifications,  legal  opinions or
other information as either of them may reasonably  require to confirm that such
transfer is being made  pursuant to an  exemption  from,  or a  transaction  not
subject to, the registration  requirements of the Securities Act;  PROVIDED that
the  Registrar   shall  not  be  required  to  determine  (but  may  rely  on  a
determination  made by the Company with respect to) the  sufficiency of any such
certifications, legal opinions or other information.

          The  Registrar   shall  retain,   in  accordance  with  its  customary
procedures,  copies of all  letters,  notices and other  written  communications
received  pursuant to Section 2.07 or this Section 2.08.  The Company shall have
the right to  inspect  and make  copies of all such  letters,  notices  or other
written  communications  at any  reasonable  time upon the giving of  reasonable
written notice to the Registrar.

          (f) TRANSFERS TO NON-QIB  INSTITUTIONAL  ACCREDITED  INVESTORS.  The
following  provisions  shall  apply  with  respect  to the  registration  of any
proposed  transfer of a Note to any Institutional  Accredited  Investor which is
not a QIB (excluding Non-U.S. Persons):

          (i) The Registrar shall register the transfer of any Note,  whether or
     not such Note bears the  Private  Placement  Legend,  if (x) the  requested
     transfer  is after the time period  referred  to in Rule  144(k)  under the
     Securities  Act as in  effect  with  respect  to such  transfer  or (y) the
     proposed  transferee  has  delivered  to the  Registrar  (A) a  certificate
     substantially  in the form of  Exhibit  F hereto  and (B) if the  aggregate
     principal  amount of the Notes being  transferred is less than Euro 100,000

                                       31
<PAGE>

     at the time of such  transfer,  an  Opinion of  Counsel  acceptable  to the
     Company that such transfer is in compliance with the Securities Act.

          (ii)  If  the  proposed  transferor  is  an  Agent  Member  holding  a
     beneficial  interest in a Restricted Global,  upon receipt by the Registrar
     and the Company of (x) the documents, if any, required by paragraph (i) and
     (y) instructions given in accordance with the relevant Depository's and the
     Registrar's  procedures,  the  Registrar  shall  reflect  on its  books and
     records the date and a decrease in the principal  amount of such Restricted
     Global  in an  amount  equal  to the  principal  amount  of the  beneficial
     interest in the Restricted Global to be transferred,  and the Company shall
     execute,  and the Trustee shall authenticate and deliver,  one or more U.S.
     Certificated Notes of like tenor and amount.

          SECTION 2.09. REPLACEMENT NOTES. If a mutilated Note is surrendered to
the Trustee or if the Holder  claims that the Note has been lost,  destroyed  or
wrongfully  taken, the Company shall issue and the Trustee shall  authenticate a
replacement  Note of like tenor and  principal  amount and  bearing a number not
contemporaneously  outstanding;  PROVIDED that the  requirements of this Section
2.09 and the  second  paragraph  of Section  2.10 are met.  If  required  by the
Trustee or the Company,  an indemnity  bond must be furnished that is sufficient
in the judgment of both the Trustee and the Company to protect the Company,  the
Trustee  or any  Agent  from any loss  that any of them may  suffer if a Note is
replaced.  The Company may charge such Holder for its  expenses and the expenses
of the Trustee in replacing a Note. In case any such mutilated,  lost, destroyed
or wrongfully  taken Note has become or is about to become due and payable,  the
Company  in its  discretion  may pay such Note  instead of issuing a new Note in
replacement thereof.

          Every replacement Note is an additional  obligation of the Company and
shall be entitled to the benefits of this Indenture.

          SECTION 2.10. OUTSTANDING NOTES. Notes outstanding at any time are all
Notes that have been  authenticated by the Trustee except for those cancelled by
it, those delivered to it for  cancellation  and those described in this Section
2.10 as not outstanding.

          If a Note is  replaced  pursuant  to  Section  2.09,  it  ceases to be
outstanding  unless  and  until  the  Trustee  and  the  Company  receive  proof
reasonably  satisfactory  to them that the replaced  Note is held by a BONA FIDE
purchaser.

          If the Paying  Agent  (other than the Company or an  Affiliate  of the
Company) holds on the maturity date or a redemption date money sufficient to pay
all principal,  premium,  if any, and interest payable on that date with respect
to the Notes (or portions  thereof) to be redeemed or payable on that date, then
on and after that date such Notes cease to be  outstanding  and interest on them
shall cease to accrue.

          A Note does not cease to be outstanding  because the Company or one of
its Affiliates holds such Note; PROVIDED,  HOWEVER, that, in determining whether

                                       32
<PAGE>

the Holders of the  requisite  principal  amount of the  outstanding  Notes have
given any request, demand,  authorization,  direction, notice, consent or waiver
hereunder, Notes owned by the Company or any other obligor upon the Notes or any
Affiliate  of the  Company or of such other  obligor  shall be  disregarded  and
deemed not to be  outstanding,  except that, in determining  whether the Trustee
shall be  protected  in relying upon any such  request,  demand,  authorization,
direction,  notice, consent or waiver, only Notes which a Responsible Officer of
the Trustee knows to be so owned shall be so  disregarded.  Notes so owned which
have been  pledged in good faith may be regarded as  outstanding  if the pledgee
establishes  to the  satisfaction  of the Trustee the pledgee's  right so to act
with  respect to such Notes and that the pledgee is not the Company or any other
obligor upon the Notes or any Affiliate of the Company or of such other obligor.

          SECTION 2.11.  TEMPORARY  NOTES.  Until definitive Notes are ready for
delivery,  the Company may prepare and the Trustee shall authenticate  temporary
Notes.  Temporary Notes shall be  substantially  in the form of definitive Notes
but  may  have  insertions,   substitutions,   omissions  and  other  variations
determined to be appropriate by the Officers  executing the temporary  Notes, as
evidenced by their  execution of such temporary  Notes.  If temporary  Notes are
issued,  the  Company  will  cause  definitive  Notes  to  be  prepared  without
unreasonable  delay.  After the preparation of definitive  Notes,  the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the  office  or  agency  of the  Company  designated  for such  purpose
pursuant to Section  4.02,  without  charge to the Holder.  Upon  surrender  for
cancellation of any one or more temporary  Notes,  the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Notes of authorized denominations.  Until so exchanged, the
temporary  Notes shall be entitled to the same benefits  under this Indenture as
definitive Notes.

          SECTION 2.12. CANCELLATION. The Company at any time may deliver to the
Trustee  for  cancellation  any Notes  previously  authenticated  and  delivered
hereunder which the Company may have acquired in any manner whatsoever,  and may
deliver to the  Trustee  for  cancellation  any Notes  previously  authenticated
hereunder  which the  Company  has not issued and sold.  The  Registrar  and the
Paying  Agent shall  forward to the Trustee  any Notes  surrendered  to them for
registration  of  transfer,  exchange,  purchase or payment.  The Trustee  shall
cancel all Notes surrendered for registration of transfer,  exchange,  purchase,
payment or  cancellation  and shall  return all such Notes to the  Company.  The
Company  shall not issue Notes to replace Notes it has paid in full or delivered
to the Trustee for cancellation.

          SECTION 2.13. CUSIP NUMBERS.  The Company in issuing the Notes may use
"CUSIP," "CINS," or "ISIN" numbers,  or common codes (if then generally in use),
as the case may be, in notices of  redemption  or exchange as a  convenience  to
Holders;  PROVIDED  that any such notice shall state that no  representation  is
made as to the  correctness of such numbers either as printed on the Notes or as
contained  in any notice of  redemption  or exchange  and that  reliance  may be
placed only on the other

                                       33
<PAGE>

identification  numbers printed on the Notes.  The Company shall promptly advise
the Trustee of any change in the CUSIP, CINS or ISIN numbers or common codes for
the Notes.

          SECTION 2.14. DEFAULTED INTEREST. If the Company defaults in a payment
of interest on the Notes,  it shall pay, or shall  deposit with the Paying Agent
money in immediately  available funds sufficient to pay, the defaulted interest,
plus (to the extent lawful) interest on the defaulted  interest,  to the Persons
who are Holders on a subsequent  special  record date. A special record date, as
used in this Section 2.14 with respect to the payment of any defaulted interest,
shall mean the 15th day next  preceding  the date fixed by the  Company  for the
payment of  defaulted  interest,  whether or not such day is a Business  Day. At
least 15 days before the subsequent  special record date, the Company shall mail
to each Holder and to the Trustee a notice  that states the  subsequent  special
record date, the payment date and the amount of defaulted interest to be paid.

          SECTION 2.15.  ISSUANCE OF ADDITIONAL  NOTES. The Company may, subject
to Article Four of this Indenture,  issue additional Notes under this Indenture.
The Notes  issued on the  Closing  Date and any  additional  Notes  subsequently
issued shall be treated as a single class for all purposes under this Indenture.

                                  ARTICLE THREE
                                   [RESERVED]

                                  ARTICLE FOUR
                                    COVENANTS

          SECTION  4.01.  PAYMENT OF NOTES.  The Company shall pay the principal
of,  premium,  if any,  and interest on the Notes on the dates and in the manner
provided in the Notes and this Indenture. An installment of principal,  premium,
if any, or interest  shall be considered  paid on the date due if the Trustee or
Paying  Agent  (other than the Company,  a  Subsidiary  of the  Company,  or any
Affiliate of any of them) holds on that date money designated for and sufficient
to pay the  installment.  If the Company or any Subsidiary of the Company or any
Affiliate of any of them,  acts as Paying Agent,  an  installment  of principal,
premium,  if any, or interest  shall be  considered  paid on the due date if the
entity  acting as Paying Agent  complies with the last sentence of Section 2.05.
As provided in Section 6.09,  upon any  bankruptcy or  reorganization  procedure
relative  to the  Company,  the  Trustee  shall  serve as the  Paying  Agent and
conversion agent, if any, for the Notes.

          The Company shall pay interest on overdue principal,  premium, if any,
and interest on overdue  installments of interest,  to the extent lawful, at the
rate per annum specified in the Notes.

                                       34
<PAGE>

          SECTION  4.02.  MAINTENANCE  OF OFFICE OR  AGENCY.  The  Company  will
maintain an office or agency in the Borough of Manhattan,  the City of New York,
where Notes may be surrendered  for  registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company in
respect of the Notes and this  Indenture  may be served.  The Company  will give
prompt  written  notice to the  Trustee of the  location,  and any change in the
location,  of such office or agency.  If at any time the  Company  shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof,  such presentations,  surrenders,  notices and demands
may be made or served at the address of the  Trustee set forth in Section  11.02
hereof.

          The  Company  may also from time to time  designate  one or more other
offices or agencies  (in or outside the City of New York) where the Notes may be
presented or surrendered  for any or all such purposes and may from time to time
rescind such designations; PROVIDED that no such designation or rescission shall
in any manner  relieve  the Company of its  obligation  to maintain an office or
agency in the Borough of Manhattan, the City of New York, for such purposes. The
Company will give prompt written  notice to the Trustee of any such  designation
or  rescission  and of any change in the  location  of any such other  office or
agency.

          The Company hereby initially  designates the Corporate Trust Office of
the Trustee,  located in the Borough of Manhattan, the City of New York, as such
office of the Company in  accordance  with  Section  2.04.  The  Company  hereby
initially  designates  the Euro Paying Agent as an office where the Regulation S
Global and European 144A Global may be surrendered for presentation for payment.

          SECTION 4.03.  LIMITATION ON  INDEBTEDNESS.  (a) The Company will not,
and  will  not  permit  any  of  its  Restricted   Subsidiaries  to,  Incur  any
Indebtedness  (other  than the Notes and  Indebtedness  existing  on the Closing
Date);  PROVIDED that the Company may Incur Indebtedness if, after giving effect
to the Incurrence of such  Indebtedness  and the receipt and  application of the
proceeds therefrom,  the Consolidated  Leverage Ratio would be greater than zero
and less than 6:1.

          Notwithstanding   the  foregoing,   the  Company  and  any  Restricted
Subsidiary (except as specified below) may Incur each and all of the following:

          (i)  Indebtedness  outstanding  at any time in an aggregate  principal
     amount not to exceed $100 million of  Indebtedness  that is PARI PASSU with
     or  subordinated  to the Notes and $150  million  of  Indebtedness  that is
     subordinated to the Notes, less any amount of such Indebtedness permanently
     repaid as provided under Section 4.11 hereof;

          (ii) Indebtedness owed (A) by any Restricted Subsidiary to the Company
     or another  Restricted  Subsidiary or (B) by the Company to any  Restricted
     Subsidiary;  PROVIDED that any event which  results in any such  Restricted
     Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer
     of such  Indebtedness  (other  than to the  Company or  another  Restricted
     Subsidiary)  shall be deemed,  in each case, to constitute an Incurrence of
     such Indebtedness not permitted by this clause (ii);

                                       35
<PAGE>

          (iii)  Indebtedness  issued in exchange  for,  or the net  proceeds of
     which are used to repay, redeem, defease, refinance, refund, extend, renew,
     replace,  discharge or otherwise retire any then  outstanding  Indebtedness
     (other than  Indebtedness  Incurred  under clause (i),  (ii),  (iv),  (vi),
     (viii), (xi) or (xii) of this paragraph) and any refinancings thereof in an
     amount not to exceed the amount so refinanced or refunded  (plus  premiums,
     penalties, accrued interest, fees and expenses); PROVIDED that Indebtedness
     the  proceeds  of which  are  used to  refinance  or  refund  the  Notes or
     Indebtedness  that is PARI PASSU with, or  subordinated in right of payment
     to, the Notes shall only be  permitted  under this  clause  (iii) if (A) in
     case the Notes are refinanced in part or the  Indebtedness to be refinanced
     is PARI PASSU with the Notes, such new Indebtedness, by its terms or by the
     terms  of  any  agreement  or   instrument   pursuant  to  which  such  new
     Indebtedness  is  outstanding,  is  expressly  made  PARI  PASSU  with,  or
     subordinate  in right of payment to, the remaining  Notes,  (B) in case the
     Indebtedness  to be refinanced is  subordinated  in right of payment to the
     Notes, such new Indebtedness, by its terms or by the terms of any agreement
     or instrument  pursuant to which such new Indebtedness is issued or remains
     outstanding, is expressly made subordinate in right of payment to the Notes
     at  least  to  the  extent  that  the  Indebtedness  to  be  refinanced  is
     subordinated to the Notes and (C) such new  Indebtedness,  determined as of
     the date of Incurrence of such new  Indebtedness,  does not mature prior to
     the Stated Maturity of the  Indebtedness to be refinanced or refunded,  and
     the  Average  Life  of such  new  Indebtedness  is at  least  equal  to the
     remaining  Average Life of the  Indebtedness  to be refinanced or refunded;
     and PROVIDED  FURTHER that in no event may  Indebtedness  of the Company be
     refinanced  by  means  of any  Indebtedness  of any  Restricted  Subsidiary
     pursuant to this clause (iii);

          (iv)  Indebtedness  (A) in  respect of  performance,  surety or appeal
     bonds  provided in the  ordinary  course of  business,  (B) under  Currency
     Agreements and Interest Rate Agreements;  PROVIDED that such agreements (a)
     are  designed  solely  to  protect  the  Company  or any of its  Restricted
     Subsidiaries  against  fluctuations in foreign  currency  exchange rates or
     interest  rates and (b) do not  increase  the  Indebtedness  of the obligor
     outstanding at any time other than as a result of  fluctuations  in foreign
     currency exchange rates or interest rates or by reason of fees, indemnities
     and  compensation  payable  thereunder,  and (C)  arising  from  agreements
     providing  for  indemnification,  adjustment  of purchase  price or similar
     obligations,  or from  Guarantees  or letters of  credit,  surety  bonds or
     performance  bonds  securing any  obligations  of the Company or any of its
     Restricted  Subsidiaries pursuant to such agreements,  in any case Incurred
     in connection  with the  disposition of any business,  assets or Restricted
     Subsidiary  (other than Guarantees of  Indebtedness  Incurred by any Person
     acquiring  all or any  portion  of  such  business,  assets  or  Restricted
     Subsidiary for the purpose of financing such  acquisition),  in a principal
     amount not to exceed the gross proceeds actually received by the Company or
     any Restricted Subsidiary in connection with such disposition;

          (v)  Indebtedness  of the  Company,  to the  extent  the net  proceeds
     thereof are  promptly  (A) used to purchase  Notes  tendered in an Offer to
     Purchase  made as a result  of a Change  in  Control  or (B)  deposited  to
     defease the Notes as described below under Article Eight hereof;

                                       36
<PAGE>

          (vi)  Guarantees of the Notes and  Guarantees of  Indebtedness  of the
     Company  by any  Restricted  Subsidiary  PROVIDED  the  Guarantee  of  such
     Indebtedness  is  permitted  by and made in  accordance  with  Section 4.07
     hereof;

          (vii) Indebtedness (including Guarantees) Incurred to finance the cost
     (including  the cost of  design,  development,  acquisition,  construction,
     installation,   improvement,  transportation  or  integration)  to  acquire
     equipment,  inventory or network assets  (including  acquisitions by way of
     Capitalized  Lease and  acquisitions  of the Capital Stock of a Person that
     becomes a Restricted  Subsidiary  to the extent of the fair market value of
     the equipment, inventory or network assets so acquired) by the Company or a
     Restricted Subsidiary after the Closing Date;

          (viii)  Indebtedness  of the  Company  not to exceed,  at any one time
     outstanding,  two times (A) the Net Cash  Proceeds  received by the Company
     after March 19, 1999 as a capital  contribution  or from the  issuance  and
     sale of its Capital Stock (other than Disqualified  Stock) to a Person that
     is not a  Subsidiary  of  the  Company,  to the  extent  (I)  such  capital
     contribution  or Net Cash  Proceeds  have not been used  pursuant to clause
     (C)(2) of the first  paragraph or clause (iii),  (iv), (vi) or (vii) of the
     second  paragraph of Section  4.04 hereof to make a Restricted  Payment and
     (II)  if  such  capital  contribution  or Net  Cash  Proceeds  are  used to
     consummate  a  transaction  pursuant to which the Company  Incurs  Acquired
     Indebtedness,  the amount of such Net Cash Proceeds exceeds one-half of the
     amount of Acquired  Indebtedness so Incurred and (B) 80% of the fair market
     value of property  (other than cash and cash  equivalents)  received by the
     Company after March 19, 1999 from the sale of its Capital Stock (other than
     Disqualified Stock) to a Person that is not a Subsidiary of the Company, to
     the extent (I) such capital  contribution  or sale of Capital Stock has not
     been used  pursuant  to clause  (iii),  (iv),  (vi) or (vii) of the  second
     paragraph of Section  4.04 hereof to make a Restricted  Payment and (II) if
     such  capital  contribution  or  Capital  Stock  is  used to  consummate  a
     transaction pursuant to which the Company Incurs Acquired Indebtedness, 80%
     of the fair market value of the property  received  exceeds one-half of the
     amount of Acquired Indebtedness so Incurred PROVIDED that such Indebtedness
     does not  mature  prior to the  Stated  Maturity  of the  Notes  and has an
     Average Life longer than the Notes;

          (ix) Acquired Indebtedness;

          (x) Strategic Subordinated Indebtedness;

          (xi)  Indebtedness  in respect of bankers'  acceptance  and letters of
     credit,  all in the  ordinary  course of business,  in an aggregate  amount
     outstanding at any time of up to $10 million;

          (xii)  Indebtedness  arising  from  the  honoring  by a bank or  other
     financial  institution  of a check,  or  similar  instrument  inadvertently
     (except in the case of  daylight  overdrafts)  drawn  against  insufficient
     funds in the ordinary course of business,  PROVIDED that such  Indebtedness
     is extinguished within three Business Days of Incurrence.

                                       37
<PAGE>

          (b) Notwithstanding  any other  provision of this Section 4.03,  the
maximum amount of Indebtedness  that the Company or a Restricted  Subsidiary may
Incur  pursuant to this Section  4.03 shall not be deemed to be  exceeded,  with
respect to any outstanding Indebtedness due solely to the result of fluctuations
in the exchange rates of currencies.

          (c) For   purposes  of   determining   any   particular   amount  of
Indebtedness under this Section 4.03, (1) Guarantees,  Liens or obligations with
respect to letters of credit supporting  Indebtedness  otherwise included in the
determination of such particular  amount shall not be included and (2) any Liens
granted pursuant to the equal and ratable provisions referred to in Section 4.09
shall not be treated as  Indebtedness.  For purposes of  determining  compliance
with this  Section  4.03,  in the event that an item of  Indebtedness  meets the
criteria of more than one of the types of Indebtedness  described in clauses (i)
through (xii) of Section 4.03(a),  the Company,  in its sole  discretion,  shall
classify,  and from time to time may reclassify,  such item of Indebtedness  and
only be required to include the amount and type of such  Indebtedness  in one of
such clauses.

          SECTION 4.04. LIMITATION ON RESTRICTED PAYMENTS. The Company will not,
and will not permit any Restricted Subsidiary to, directly or indirectly,

          (i) declare or pay any  dividend or make any  distribution  on or with
     respect to its Capital  Stock (other than (A)  dividends  or  distributions
     payable  solely in shares of its Capital  Stock  (other  than  Disqualified
     Stock) or in options,  warrants or other  rights to acquire  shares of such
     Capital Stock and (B) PRO RATA dividends or  distributions  on Common Stock
     of Restricted  Subsidiaries held by minority  stockholders) held by Persons
     other than the Company or any of its Restricted Subsidiaries,

          (ii)  purchase,  redeem,  retire or  otherwise  acquire  for value any
     shares of Capital  Stock of (A) the Company or an  Unrestricted  Subsidiary
     (including  options,  warrants  or other  rights to acquire  such shares of
     Capital Stock) held by any Person or (B) a Restricted Subsidiary (including
     options,  warrants or other rights to acquire such shares of Capital Stock)
     held by any Affiliate of the Company (other than a Wholly Owned  Restricted
     Subsidiary)  or any holder (or any  Affiliate of such holder) of 5% or more
     of the Capital Stock of the Company,

          (iii) make any voluntary or optional principal  payment,  or voluntary
     or optional  redemption,  repurchase,  defeasance,  or other acquisition or
     retirement for value,  of  Indebtedness of the Company that is subordinated
     in right of payment to the Notes or

          (iv) make any  Investment  (after  the  Closing  Date),  other  than a
     Permitted  Investment,  in any Person (such  payments or any other  actions
     described in clauses (i) through (iv) above being collectively  "RESTRICTED
     PAYMENTS")

if, at the time of, and after giving effect to, the proposed Restricted Payment:
(A) a Default or Event of Default shall have occurred and be continuing, (B) the
Company could not Incur at least $1.00 of Indebtedness under the first paragraph

                                       38
<PAGE>

of Section 4.03 hereof or (C) the aggregate  amount of all  Restricted  Payments
(the amount,  if other than in cash, to be determined in good faith by the Board
of Directors,  whose  determination shall be conclusive and evidenced by a Board
Resolution)  made after the Closing  Date shall exceed the sum of (1) 50% of the
aggregate  amount of the Adjusted  Consolidated  Net Income (or, if the Adjusted
Consolidated  Net  Income is a loss,  minus  100% of the  amount  of such  loss)
(determined  by  excluding  income  resulting  from  transfers  of assets by the
Company or a Restricted  Subsidiary to an Unrestricted  Subsidiary) accrued on a
cumulative basis during the period (taken as one accounting period) beginning on
the first day of the fiscal  quarter  immediately  following  March 19, 1999 and
ending on the last day of the last fiscal quarter preceding the Transaction Date
for which reports have been filed with the Commission or provided to the Trustee
pursuant  to  Section  4.18  hereof  PLUS (2) the  aggregate  Net Cash  Proceeds
received by the Company after March 19, 1999 as a capital  contribution  or from
the issuance and sale  permitted by this  Indenture of its Capital  Stock (other
than  Disqualified  Stock) to a Person who is not a  Subsidiary  of the Company,
including an issuance or sale permitted by this Indenture of Indebtedness of the
Company  for cash  subsequent  to March  19,  1999 upon the  conversion  of such
Indebtedness into Capital Stock (other than Disqualified  Stock) of the Company,
or from the issuance to a Person who is not a  Subsidiary  of the Company of any
options,  warrants or other rights to acquire  Capital  Stock of the Company (in
each case, exclusive of any Disqualified Stock or any options, warrants or other
rights that are  redeemable  at the option of the holder,  or are required to be
redeemed, prior to the Stated Maturity of the Notes), in each case except to the
extent such Net Cash Proceeds are used to Incur Indebtedness  pursuant to clause
(viii) of the second  paragraph  under  Section 4.03 hereof,  PLUS (3) an amount
equal to the net reduction in  Investments  (other than  reductions in Permitted
Investments) in any Person  resulting from payments of interest on Indebtedness,
dividends,  repayments of loans or advances,  or other  transfers of assets,  in
each  case to the  Company  or any  Restricted  Subsidiary  or from the Net Cash
Proceeds from the return of capital,  redemption, or sale of any such Investment
(except,  in each case,  to the extent any such payment or proceeds are included
in the calculation of Adjusted  Consolidated Net Income), or from redesignations
of Unrestricted  Subsidiaries as Restricted Subsidiaries (valued in each case as
provided  in the  definition  of  "Investments"),  or from  the  release  of any
Guarantee that constituted a Restricted  Payment, to the extent of such release,
not to exceed,  in each case, the amount of Investments  previously  made by the
Company or any Restricted Subsidiary in such Person or Unrestricted Subsidiary.

          The foregoing provision shall not be violated by reason of:

          (i) the  payment  of any  dividend  within  60 days  after the date of
     declaration  thereof if, at said date of  declaration,  such payment  would
     comply with the foregoing paragraph;

          (ii) the redemption,  repurchase,  defeasance or other  acquisition or
     retirement  for  value of  Indebtedness  that is  subordinated  in right of
     payment to the Notes  including  premium,  if any,  and  accrued and unpaid
     interest,  with the proceeds of, or in exchange for,  Indebtedness Incurred
     under  clause  (iii) of the second  paragraph  of part (a) of Section  4.03
     hereof;

                                       39
<PAGE>

          (iii) the repurchase, redemption or other acquisition of Capital Stock
     of the Company or an Unrestricted Subsidiary (or options, warrants or other
     rights to  acquire  such  Capital  Stock) in  exchange  for,  or out of the
     proceeds of a capital  contribution or a substantially  concurrent offering
     of, shares of Capital Stock (other than Disqualified  Stock) of the Company
     (or options, warrants or other rights to acquire such Capital Stock);

          (iv)  the  making  of  any  principal   payment  or  the   repurchase,
     redemption,  retirement,  defeasance  or  other  acquisition  for  value of
     Indebtedness  of the Company which is  subordinated  in right of payment to
     the Notes in exchange for, or out of the proceeds of a capital contribution
     or a  substantially  concurrent  offering of,  shares of the Capital  Stock
     (other than  Disqualified  Stock) of the Company (or  options,  warrants or
     other rights to acquire such Capital Stock);

          (v) payments or distributions to dissenting  stockholders  pursuant to
     applicable law,  pursuant to or in connection with a consolidation,  merger
     or transfer of assets that  complies  with the  provisions  of Article Five
     hereof;

          (vi)  Investments  in any  Person  the  primary  business  of which is
     related,  ancillary or  complementary to the business of the Company or any
     of its Restricted  Subsidiaries on the date of such  Investments;  PROVIDED
     that the aggregate  amount of Investments made pursuant to this clause (vi)
     does not exceed $65 million at any one time outstanding;

          (vii)  Investments  acquired in exchange for Capital Stock (other than
     Disqualified  Stock)  of the  Company  or the Net  Cash  Proceeds  from the
     issuance and sale of such Capital Stock, PROVIDED that such proceeds are so
     used within 180 days of the receipt thereof;

          (viii) the redemption,  repurchase, retirement or other acquisition of
     any Capital  Stock of the Company (or options,  warrants or other rights to
     acquire  such  Capital  Stock) from an  employee or former  employee of the
     Company or any of its Subsidiaries (or from such person's estate,  heirs or
     representatives)  in connection with such employee's  death,  disability or
     termination  of  employment,  PROVIDED that the aggregate  amount  expended
     pursuant  to this  clause  does not  exceed $1  million  per annum plus the
     cumulative  amount of such per annum  limit not used in prior years and the
     cash proceeds from such  Investments,  PROVIDED that such proceeds are used
     within 180 days of the receipt thereof;

          (ix)  Investments  in permitted  Wholesale  Consortiums  and Permitted
     Joint Ventures not exceeding, at the time of the Investment, the sum of (A)
     15% of the consolidated  revenue of the Company  (excluding with respect to
     Persons  in whom an equity  interest  is owned by  Persons  other  than the
     Company and its Restricted Subsidiaries, the PRO RATA share of such revenue
     attributable  to such other equity holders)  accrued on a cumulative  basis
     during the period (taken as one accounting  period)  beginning on the first
     day of the first full fiscal quarter  immediately  following March 19, 1999
     and ending on the last day of the last fiscal quarter preceding the date of

                                       40
<PAGE>

     such  Investment and (B) the Net Cash Proceeds from the  disposition of the
     Company's interest in any such Permitted Wholesale  Consortium or Permitted
     Joint Venture; and

          (x) other Restricted Payments in an aggregate amount not to exceed $10
     million, increased by the amount of any Restricted Payment made pursuant to
     this clause (x) that is an Investment and is not outstanding;

PROVIDED that,  except in the case of clauses (i) and (iii), no Default or Event
of Default shall have  occurred and be  continuing or occur as a consequence  of
the actions or payments set forth therein.

          Each Restricted Payment permitted pursuant to the preceding  paragraph
(other  than the  Restricted  Payment  referred to in clause  (ii)  thereof,  an
exchange  of Capital  Stock for  Capital  Stock or  Indebtedness  referred to in
clause  (iii) or (iv)  thereof  and an  Investment  referred  to in clause  (vi)
thereof),  and the Net  Cash  Proceeds  from  any  capital  contribution  or any
issuance of Capital Stock referred to in clauses (iii),  (iv) and (vi), shall be
included  in  calculating  whether  the  conditions  of clause  (C) of the first
paragraph  of this  Section  4.04 have been met with  respect to any  subsequent
Restricted  Payments.  In the event the proceeds of an issuance of Capital Stock
of the Company are used for the redemption,  repurchase or other  acquisition of
the Notes, or Indebtedness  that is PARI PASSU with the Notes, then the Net Cash
Proceeds of such issuance shall be included in clause (C) of the first paragraph
of this  Section  4.04 only to the extent  such  proceeds  are not used for such
redemption, repurchase or other acquisition of Indebtedness.

          Any  Restricted  Payments  made in other  than cash shall be valued at
fair market value. The amount of any Investment  "outstanding" at any time shall
be deemed to be equal to the amount of such  Investment  on the date made,  less
the return of  capital,  repayment  of loans,  return on capital  and release of
Guarantees,  in each case of or to the Company and its  Restricted  Subsidiaries
with respect to such Investment (up to the amount of such investment on the date
made).

          SECTION 4.05.  LIMITATION  ON DIVIDEND AND OTHER PAYMENT  RESTRICTIONS
AFFECTING RESTRICTED SUBSIDIARIES. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or suffer to exist or become
effective any  consensual  encumbrance or restriction of any kind on the ability
of  any   Restricted   Subsidiary  to  (i)  pay  dividends  or  make  any  other
distributions  permitted  by  applicable  law  on  any  Capital  Stock  of  such
Restricted  Subsidiary owned by the Company or any other Restricted  Subsidiary,
(ii)  pay  any  Indebtedness  owed  to  the  Company  or  any  other  Restricted
Subsidiary,  (iii) make loans or advances to the Company or any other Restricted
Subsidiary  or (iv) transfer any of its property or assets to the Company or any
other Restricted Subsidiary.

          The  foregoing  provisions  shall not  restrict  any  encumbrances  or
restrictions:

          (i)  existing  on the  Closing  Date in this  Indenture  or any  other
     agreements in effect on the Closing Date, and any extensions, refinancings,

                                       41
<PAGE>

     renewals or replacements of such agreements; PROVIDED that the encumbrances
     and  restrictions  in  any  such  extensions,   refinancings,  renewals  or
     replacements  are no less favorable in any material  respect to the Holders
     than those  encumbrances or  restrictions  that are then in effect and that
     are being extended, refinanced, renewed or replaced;

          (ii) existing under or by reason of applicable law;

          (iii) existing with respect to any Person or the property or assets of
     such Person acquired by the Company or any Restricted Subsidiary,  existing
     at the time of such acquisition and not incurred in contemplation  thereof,
     which  encumbrances or restrictions are not applicable to any Person or the
     property or assets of any Person  other than such Person or the property or
     assets of such Person so acquired;

          (iv) in the case of clause (iv) of the first paragraph of this Section
     4.05, (A) that restrict in a customary manner the subletting, assignment or
     transfer of any property or asset that is a lease,  license,  conveyance or
     contract  or  similar  property  or asset,  (B)  existing  by virtue of any
     transfer of,  agreement  to  transfer,  option or right with respect to, or
     Lien on, any property or assets of the Company or any Restricted Subsidiary
     not otherwise  prohibited by this  Indenture or (C) arising or agreed to in
     the ordinary course of business, not relating to any Indebtedness, and that
     do not,  individually  or in the  aggregate,  detract  from  the  value  of
     property  or assets of the  Company  or any  Restricted  Subsidiary  in any
     manner material to the Company or any Restricted Subsidiary;

          (v) with respect to a Restricted Subsidiary and imposed pursuant to an
     agreement  that has been entered into for the sale or disposition of all or
     substantially  all of the Capital Stock of, or property and assets of, such
     Restricted Subsidiary;

          (vi)  contained  in the  terms of any  Indebtedness  or any  agreement
     pursuant to which such  Indebtedness  was issued if (A) the  encumbrance or
     restriction  applies  only in the event of a payment  default  or a default
     with  respect to a financial  covenant  contained in such  Indebtedness  or
     agreement,  (B) the  encumbrance  or  restriction  is not  materially  more
     disadvantageous to the Holders of the Notes than is customary in comparable
     financings  (as  determined by the Company) and (C) the Company  determines
     that any such  encumbrance  or restriction  will not materially  affect the
     Company's ability to make principal or interest payments on the Notes; or

          (vii) imposed in connection with a transaction described in clause (f)
     of the proviso to the  definition of "Asset Sale" and relating  solely to a
     Restricted  Subsidiary that transfers  assets to the special purpose entity
     referred to therein;  PROVIDED  that the Company  determines  that any such
     encumbrance or restriction will not materially affect the Company's ability
     to make principal or interest payments on the Notes.

Nothing  contained  in this  Section  4.05  shall  prevent  the  Company  or any
Restricted  Subsidiary  from (1) creating,  incurring,  assuming or suffering to
exist any Liens  otherwise  permitted in Section 4.09 hereof or (2)  restricting

                                       42
<PAGE>

the sale or other disposition of property or assets of the Company or any of its
Restricted  Subsidiaries  that secure  Indebtedness of the Company or any of its
Restricted Subsidiaries.

          SECTION 4.06.  LIMITATION ON THE ISSUANCE AND SALE OF CAPITAL STOCK OF
RESTRICTED  SUBSIDIARIES.  The  Company  will not sell,  and will not permit any
Restricted Subsidiary,  directly or indirectly,  to issue or sell, any shares of
Capital Stock of a Restricted Subsidiary  (including options,  warrants or other
rights to purchase  shares of such Capital Stock) except (i) to the Company or a
Wholly Owned  Restricted  Subsidiary;  (ii)  issuances of director's  qualifying
shares or sales to  foreign  nationals  of shares of  Capital  Stock of  foreign
Restricted  Subsidiaries,  to the extent  required by applicable  law; (iii) if,
immediately  after  giving  effect to such  issuance  or sale,  such  Restricted
Subsidiary would no longer constitute a Restricted Subsidiary and any Investment
in such Person remaining after giving effect to such issuance or sale would have
been  permitted to be made under Section 4.04 hereof if made on the date of such
issuance or sale; (iv) a pledge or hypothecation of or Lien on any Capital Stock
of a Subsidiary to the extent not prohibited  under Section 4.09 hereof;  or (v)
sales by the Company or Restricted  Subsidiaries of Common Stock of a Restricted
Subsidiary,  PROVIDED that the Company or such Restricted Subsidiaries apply the
Net Cash Proceeds, if any, of any such sale in accordance with clause (A) or (B)
of Section 4.11 hereof.

          SECTION  4.07.  LIMITATION  ON ISSUANCES OF  GUARANTEES  BY RESTRICTED
SUBSIDIARIES. The Company will not permit any Restricted Subsidiary, directly or
indirectly,  to Guarantee  any  Indebtedness  of the Company which is PARI PASSU
with  or   subordinate   in  right  of   payment   to  the  Notes   ("Guaranteed
Indebtedness"),  unless (i) such Restricted Subsidiary  simultaneously  executes
and  delivers  a  supplemental  indenture  to  this  Indenture  providing  for a
Guarantee (a "Subsidiary  Guarantee") of payment of the Notes by such Restricted
Subsidiary  and (ii)  such  Restricted  Subsidiary  waives,  and will not in any
manner  whatsoever  claim or take the  benefit  or  advantage  of, any rights of
reimbursement,  indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary as a result of any payment by such Restricted
Subsidiary  under its Subsidiary  Guarantee;  PROVIDED that this paragraph shall
not be applicable to any Guarantee of any Restricted  Subsidiary that existed at
the time such Person  became a  Restricted  Subsidiary  and was not  Incurred in
connection  with,  or in  contemplation  of, such Person  becoming a  Restricted
Subsidiary.  If the  Guaranteed  Indebtedness  is (A) PARI PASSU with the Notes,
then the Guarantee of such Guaranteed  Indebtedness shall be PARI PASSU with, or
subordinated to, the Subsidiary Guarantee or (B) subordinated to the Notes, then
the  Guarantee of such  Guaranteed  Indebtedness  shall be  subordinated  to the
Subsidiary Guarantee at least to the extent that the Guaranteed  Indebtedness is
subordinated to the Notes.

          Notwithstanding   the  foregoing,   any  Subsidiary   Guarantee  by  a
Restricted  Subsidiary  may provide by its terms that it shall be  automatically
and  unconditionally  released  and  discharged  upon (i) any sale,  exchange or
transfer, to any Person not an Affiliate of the Company, of all of the Company's
and each Restricted  Subsidiary's  Capital Stock in, or all or substantially all
the assets of, such Restricted  Subsidiary (which sale,  exchange or transfer is

                                       43
<PAGE>

not  prohibited  by this  Indenture)  or (ii) the  release or  discharge  of the
Guarantee which resulted in the creation of such Subsidiary Guarantee,  except a
discharge or release by or as a result of payment under such Guarantee.

          SECTION  4.08.   LIMITATION  ON  TRANSACTIONS  WITH  SHAREHOLDERS  AND
AFFILIATES.  The Company will not, and will not permit any Restricted Subsidiary
to,  directly  or  indirectly,  enter  into,  renew or  extend  any  transaction
(including,  without  limitation,  the  purchase,  sale,  lease or  exchange  of
property or assets,  or the  rendering of any  service)  with any holder (or any
Affiliate  of such  holder) of 5% or more of any class of  Capital  Stock of the
Company  or with any  Affiliate  of the  Company or any  Restricted  Subsidiary,
except upon fair and  reasonable  terms no less favorable to the Company or such
Restricted  Subsidiary than could be obtained,  at the time of such  transaction
or, if such transaction is pursuant to a written  agreement,  at the time of the
execution of the  agreement  providing  therefor,  in a comparable  arm's-length
transaction with a Person that is not such a holder or an Affiliate.

          The foregoing limitation does not limit, and shall not apply to:

          (i)  transactions  (A)  approved  by a majority  of the  disinterested
     members  of the  Board of  Directors  or (B) for  which  the  Company  or a
     Restricted  Subsidiary  delivers  to the  Trustee  a written  opinion  of a
     nationally  recognized investment banking firm stating that the transaction
     is fair to the Company or such Restricted Subsidiary from a financial point
     of view;

          (ii)  any  transaction  solely  between  the  Company  and  any of its
     Restricted Subsidiaries or solely between Restricted Subsidiaries;

          (iii)  the  payment  of  reasonable  and  customary  regular  fees  to
     directors of the Company who are not employees of the Company;

          (iv) any payments or other  transactions  pursuant to any  tax-sharing
     agreement  between the Company and any other  Person with which the Company
     files a  consolidated  tax  return or with  which the  Company is part of a
     consolidated group for tax purposes;

          (v)  compensation,  indemnification  and other  benefits  paid or made
     available to officers,  directors and  employees in the ordinary  course of
     business in connection with services  actually rendered and consistent with
     past practice;

          (vi)   transactions  in  accordance  with  the  Existing   Stockholder
     Agreements as in effect on March 19, 1999; or

          (vii) any Restricted Payments not prohibited by Section 4.04 hereof.

Notwithstanding the foregoing, any transaction or series of related transactions
covered by the first  paragraph  of this Section 4.08 and not covered by clauses
(ii) through (v) of this paragraph,  the aggregate  amount of which exceeds $2.0
million  in value,  must be  approved  or  determined  to be fair in the  manner
provided for in clause (i)(A) or (B) of this Section 4.08.

                                       44
<PAGE>

          SECTION 4.09.  LIMITATION ON LIENS. The Company will not, and will not
permit any Restricted  Subsidiary to, create,  incur,  assume or suffer to exist
any Lien on any of its assets or properties of any character (including, without
limitation,  licenses),  or any shares of Capital Stock or  Indebtedness  of any
Restricted  Subsidiary,  without making effective provision for all of the Notes
and all other amounts due under this  Indenture to be directly  secured  equally
and ratably with (or, if the  obligation or liability to be secured by such Lien
is  subordinated  in right of payment to the Notes,  prior to) the obligation or
liability secured by such Lien.

          The foregoing limitation does not apply to:

          (i) Liens existing on the Closing Date;

          (ii) Liens  granted  after the  Closing  Date on any assets or Capital
     Stock of the Company or its Restricted Subsidiaries created in favor of the
     Holders;

          (iii)  Liens with  respect to the  assets of a  Restricted  Subsidiary
     granted by such  Restricted  Subsidiary  to the  Company or a Wholly  Owned
     Restricted  Subsidiary to secure  Indebtedness owing to the Company or such
     other Restricted Subsidiary;

          (iv) Liens securing Indebtedness permitted to be Incurred under clause
     (iii) of the second  paragraph  of Section 4.03 hereof which is Incurred to
     refinance secured  Indebtedness;  PROVIDED that such Liens do not extend to
     or cover any property or assets of the Company or any Restricted Subsidiary
     other  than  the  property  or  assets  securing  the  Indebtedness   being
     refinanced;

          (v) Liens on the  Capital  Stock of, or any  property  or assets of, a
     Restricted  Subsidiary securing  Indebtedness of such Restricted Subsidiary
     permitted under Section 4.03 hereof;

          (vi) Liens on the Capital Stock of Restricted  Subsidiaries that own a
     substantial  portion of assets  financed with  Indebtedness  Incurred under
     clause  (vii) of  Section  4.03  hereof,  if such  liens  secure  only such
     Indebtedness; or

          (vii) Permitted Liens.

          SECTION 4.10. LIMITATION ON SALE-LEASEBACK  TRANSACTIONS.  The Company
will not,  and will not  permit any  Restricted  Subsidiary  to,  enter into any
sale-leaseback transaction involving any of its assets or properties whether now
owned or  hereafter  acquired,  whereby the Company or a  Restricted  Subsidiary
sells or transfers such assets or properties and then or thereafter  leases such
assets or properties or any part thereof or any other assets or properties which
the Company or such  Restricted  Subsidiary,  as the case may be, intends to use
for  substantially the same purpose or purposes as the assets or properties sold
or transferred; PROVIDED that a sale-leaseback

                                       45
<PAGE>

transaction  shall not include any lease in connection with which the Company or
a  Restricted  Subsidiary  acquires  assets or property in  anticipation  of the
substantially contemporaneous sale or transfer to the lessor under such lease.

          The  foregoing  restriction  does  not  apply  to  any  sale-leaseback
transaction if:

          (i) the lease is for a period,  including  renewal  rights,  of not in
     excess of three years;

          (ii) the lease secures or relates to  industrial  revenue or pollution
     control bonds;

          (iii) the transaction is solely between the Company and any Restricted
     Subsidiary or solely between Restricted Subsidiaries; or

          (iv) the Company or such Restricted Subsidiary, within 12 months after
     the sale or transfer of any assets or properties  is completed,  applies an
     amount not less than the net proceeds received from such sale in accordance
     with clause (A) or (B) of the first paragraph of Section 4.11 hereof.

          SECTION  4.11.  LIMITATION  ON ASSET SALES.  The Company will not, and
will not permit any Restricted  Subsidiary to, consummate any Asset Sale, unless
(i) the consideration  received by the Company or such Restricted  Subsidiary is
at least  equal to the fair  market  value of the assets sold or disposed of and
(ii) at least 75% of the  consideration  received  consists of cash or Temporary
Cash  Investments.  In the event and to the  extent  that the Net Cash  Proceeds
received by the Company or any of its Restricted  Subsidiaries  from one or more
Asset  Sales  occurring  on or  after  the  Closing  Date  in any  period  of 12
consecutive  months  exceed 10% of Adjusted  Consolidated  Net  Tangible  Assets
(determined as of the date closest to the  commencement  of such 12-month period
for which a consolidated  balance sheet of the Company and its  Subsidiaries has
been filed  with the  Commission  pursuant  to Section  4.18  hereof),  then the
Company shall or shall cause the relevant Restricted Subsidiary to (i) within 12
months  after the date Net Cash  Proceeds  so  received  exceed 10% of  Adjusted
Consolidated Net Tangible  Assets,  (A) apply an amount equal to such excess Net
Cash Proceeds to permanently repay  unsubordinated  Indebtedness of the Company,
or any  Restricted  Subsidiary  providing  a  Subsidiary  Guarantee  pursuant to
Section 4.07 hereof or Indebtedness of any other Restricted Subsidiary,  in each
case  owing  to a  Person  other  than  the  Company  or any  of its  Restricted
Subsidiaries  or (B)  invest  an equal  amount,  or the  amount  not so  applied
pursuant to clause (A) (or enter into a definitive  agreement  committing  to so
invest within 12 months after the date of such agreement), either in property or
assets  (other  than  current  assets) of a nature or type or that are used in a
business,  or in a company  having  property and assets of a nature or type,  or
engaged in a business,  in either case  similar or related to the nature or type
of the  property  and assets of, or the  business  of, the Company or any of its
Restricted  Subsidiaries  existing on the date of such investment (as determined
in good faith by the Board of Directors, whose determination shall be conclusive
and  evidenced by a Board  Resolution)  and (ii) apply (no later than the end of
the 12-month period referred to in clause (i)) such excess Net Cash Proceeds (to
the extent not applied  pursuant  to clause  (i)) as  provided in the  following
paragraph of this Section 4.11. The amount of such

                                       46
<PAGE>

excess Net Cash  Proceeds  required  to be  applied  (or to be  committed  to be
applied) during such 12-month period as set forth in clause (i) of the preceding
sentence  and  not  applied  as so  required  by the end of  such  period  shall
constitute "EXCESS PROCEEDS."

          If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 4.11 totals at least $10 million,  the Company must commence,  not later
than the  fifteenth  Business  Day of such  month,  and  consummate  an Offer to
Purchase from the Holders on a PRO RATA basis an aggregate  principal  amount of
Notes equal to the Excess  Proceeds on such date,  at a purchase  price equal to
101% of the principal amount of the Notes on the relevant Payment Date, plus, in
each case, accrued interest (if any) to the Payment Date.

          SECTION  4.12.  REPURCHASE  OF NOTES  UPON A CHANGE  OF  CONTROL.  The
Company must commence,  within 30 days of the occurrence of a Change of Control,
and  consummate  an Offer to Purchase for all the Notes then  outstanding,  at a
purchase  price  equal  to 101% of the  principal  amount  of the  Notes  on the
relevant Payment Date, plus accrued interest (if any) to the Payment Date.

          SECTION 4.13. EXISTENCE.  Except as otherwise provided or permitted in
Articles  Four and Five of this  Indenture,  the Company  will do or cause to be
done all  things  necessary  to  preserve  and keep in full force and effect its
existence and the existence of each of its Restricted Subsidiaries in accordance
with the  respective  organizational  documents  of the  Company  and each  such
Subsidiary  (as the same  may be  amended  from  time to  time)  and the  rights
(whether pursuant to charter,  partnership  certificate,  agreement,  statute or
otherwise),  material  licenses  and  franchises  of the  Company  and each such
Subsidiary; PROVIDED that the Company shall not be required to preserve any such
right, license or franchise,  or the existence of any Restricted Subsidiary,  if
the maintenance or preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries taken as a whole.

          SECTION 4.14.  PAYMENT OF TAXES AND OTHER CLAIMS. The Company will pay
or discharge and shall cause each of its  Subsidiaries  to pay or discharge,  or
cause to be paid or discharged,  before the same shall become delinquent (i) all
material taxes,  assessments and governmental charges levied or imposed upon (a)
the  Company  or any such  Subsidiary,  (b) the  income or  profits  of any such
Subsidiary which is a corporation or (c) the property of the Company or any such
Subsidiary and (ii) all material lawful claims for labor, materials and supplies
that, if unpaid,  might by law become a Lien upon the property of the Company or
any such  Subsidiary;  PROVIDED that the Company shall not be required to pay or
discharge, or cause to be paid or discharged,  any such tax, assessment,  charge
or claim the amount,  applicability  or validity of which is being  contested in
good faith by appropriate  proceedings,  for which  adequate  reserves have been
established.

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<PAGE>

          SECTION 4.15.  MAINTENANCE OF PROPERTIES  AND  INSURANCE.  The Company
will cause all  properties  used or useful in the conduct of its business or the
business of any of its  Restricted  Subsidiaries,  to be maintained  and kept in
good  condition,  repair and working order (ordinary wear and tear excepted) and
supplied  with all  necessary  equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Company may be necessary so that the business  carried on in
connection therewith may be properly and advantageously  conducted at all times;
PROVIDED that nothing in this Section 4.15 shall prevent the Company or any such
Subsidiary from  discontinuing the use,  operation or maintenance of any of such
properties or disposing of any of them, if such  discontinuance  or disposal is,
in the judgment of the Company,  desirable in the conduct of the business of the
Company or such Subsidiary.

          The Company will  provide or cause to be provided,  for itself and its
Restricted  Subsidiaries,   insurance  (including  appropriate   self-insurance)
against loss or damage of the kinds customarily  insured against by corporations
similarly  situated and owning like properties,  with reputable insurers or with
the government of the United States of America,  or an agency or instrumentality
thereof, in such amounts,  with such deductibles and by such methods as shall be
customary  for  corporations  similarly  situated  in the  industry in which the
Company or such  Restricted  Subsidiary,  as the case may be, is then conducting
business.

          SECTION  4.16.  NOTICE  OF  DEFAULTS.  In the event  that the  Company
becomes aware of any Default or Event of Default, the Company, promptly after it
becomes aware thereof, will give written notice thereof to the Trustee.

          SECTION  4.17.  COMPLIANCE  CERTIFICATES.   The  principal  accounting
officer and the principal  financial officer of the Company shall certify, on or
before a date not more  than 90 days  after the end of each  fiscal  year of the
Company,  that a review has been  conducted of the activities of the Company and
its Restricted  Subsidiaries and the Company's and its Restricted  Subsidiaries'
performance  under  this  Indenture  and  that the  Company  has  fulfilled  all
obligations hereunder, or, if there has been a default in the fulfillment of any
such obligation, specifying each such default and the nature and status thereof.
The  Company  shall also  notify the  Trustee of any  default or defaults in the
performance  of any covenants or agreements  under this  Indenture.  The Company
shall also comply with the other provisions of Section 314(a) of the TIA.

          SECTION 4.18.  COMMISSION REPORTS AND REPORTS TO HOLDERS. At all times
from and after the  earlier of (i) the date of the  commencement  of an Exchange
Offer (as defined in the Registration  Rights Agreement) or the effectiveness of
a Shelf Registration Statement (as defined in the Registration Rights Agreement)
(the  "REGISTRATION") and (ii) the date that is 180 days after the Closing Date,
in either case, whether or not the Company is then required to file reports with
the  Commission,  the  Company  shall  file with the  Commission  (to the extent
accepted by the Commission) all such reports

                                       48
<PAGE>

and other  information  as it would be required to file with the  Commission  by
Sections  13(a) or 15(d) under the  Securities  Exchange  Act of 1934 if it were
subject  thereto.  The Company shall supply the Trustee and each Holder or shall
supply to the Trustee for  forwarding to each such Holder,  without cost to such
Holder, copies of such reports and other information.  In addition, at all times
prior to the  earlier of the date of the  Registration  and the date that is 180
days after the Closing Date,  the Company  shall,  at its cost,  deliver to each
Holder of the Notes  quarterly and annual  reports  substantially  equivalent to
those which would be required by the  Exchange  Act. In  addition,  at all times
prior to the  Registration,  upon the  request of any Holder or any  prospective
purchaser of the Notes designated by a Holder,  the Company shall supply to such
Holder or such  prospective  purchaser the information  required under Rule 144A
under the Securities Act.

          Delivery of such reports,  information and documents to the Trustee is
for  informational  purposes  only and the  Trustee's  receipt of such shall not
constitute   constructive  notice  of  any  information   contained  therein  or
determinable  from  information  contained  therein,   including  the  Company's
compliance  with any of its  covenants  hereunder  (as to which the  Trustee  is
entitled to rely exclusively on Officers' Certificates).

          SECTION  4.19.  WAIVER OF STAY,  EXTENSION OR USURY LAWS.  The Company
covenants  (to the extent  that it may  lawfully  do so) that it will not at any
time  insist  upon,  or plead,  or in any  manner  whatsoever  claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of, premium, if any, or interest on the Notes as contemplated  herein,
wherever enacted,  now or at any time hereafter in force, or that may affect the
covenants or the performance of this  Indenture;  and (to the extent that it may
lawfully do so) the Company hereby  expressly waives all benefit or advantage of
any such  law and  covenants  that it will  not  hinder,  delay  or  impede  the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.

                                  ARTICLE FIVE
                              SUCCESSOR CORPORATION

          SECTION  5.01.  WHEN  COMPANY MAY MERGE,  ETC.  The Company  shall not
consolidate  with,  merge  with or into,  or sell,  convey,  transfer,  lease or
otherwise  dispose of all or substantially all of its property and assets (as an
entirety or  substantially an entirety in one transaction or a series of related
transactions)  to,  any  Person or permit  any  Person to merge with or into the
Company unless:

          (i) the  Company  shall be the  continuing  Person,  or the Person (if
     other  than the  Company)  formed by such  consolidation  or into which the
     Company is merged or that  acquired or leased such  property  and assets of
     the Company shall be a corporation organized and validly existing under the
     laws of the United States of America or any jurisdiction  thereof and shall

                                       49
<PAGE>

     expressly  assume, by a supplemental  indenture,  executed and delivered to
     the Trustee,  all of the obligations of the Company on all of the Notes and
     under this Indenture;

          (ii) immediately after giving effect to such  transaction,  no Default
     or Event of Default shall have occurred and be continuing;

          (iii)  immediately  after giving effect to such  transaction  on a PRO
     FORMA basis,  the Company or any Person  becoming the successor  obligor of
     the Notes shall have a Consolidated  Net Worth equal to or greater than the
     Consolidated   Net  Worth  of  the  Company   immediately   prior  to  such
     transaction;

          (iv)  immediately  after giving  effect to such  transaction  on a PRO
     FORMA basis, the Company,  or any Person becoming the successor  obligor of
     the Notes,  as the case may be, could Incur at least $1.00 of  Indebtedness
     under the first paragraph of Section 4.03 hereof; PROVIDED that this clause
     (iv) shall not apply to (1) a consolidation, merger or sale of all (but not
     less than all) of the assets of the  Company if all Liens and  Indebtedness
     of the Company or any Person  becoming the successor  obligor on the Notes,
     as the case may be, and its Restricted Subsidiaries outstanding immediately
     after such transaction would, if Incurred at such time, have been permitted
     to be Incurred (and all such Liens and  Indebtedness,  other than Liens and
     Indebtedness  of the Company and its  Restricted  Subsidiaries  outstanding
     immediately  prior  to the  transaction,  shall  be  deemed  to  have  been
     Incurred) for all purposes of this Indenture or (2) a consolidation, merger
     or  sale of all or  substantially  all of the  assets  of the  Company  if,
     immediately  after giving effect to such  transaction on a PRO FORMA basis,
     the Company or any Person becoming the successor obligor of the Notes shall
     have a Consolidated  Leverage Ratio equal to or less than the  Consolidated
     Leverage Ratio of the Company immediately prior to such transaction; and

          (v) the  Company  delivers  to the  Trustee an  Officers'  Certificate
     (attaching  the arithmetic  computations  to  demonstrate  compliance  with
     clauses  (iii) and (iv) of this  Section  5.01) and Opinion of Counsel,  in
     each case  stating  that such  consolidation,  merger or transfer  and such
     supplemental indenture complies with this provision and that all conditions
     precedent  provided  for  herein  relating  to such  transaction  have been
     complied with;

PROVIDED, HOWEVER, that clauses (iii) and (iv) of this Section 5.01 do not apply
if,  in  the  good  faith  determination  of  the  Board  of  Directors,   whose
determination shall be evidenced by a Board Resolution, the principal purpose of
such  transaction is to change the state of  incorporation  of the Company;  and
PROVIDED FURTHER that any such transaction shall not have as one of its purposes
the evasion of the foregoing limitations.

          SECTION 5.02. SUCCESSOR SUBSTITUTED. Upon any consolidation or merger,
or any sale,  conveyance,  transfer or other disposition of all or substantially
all of the property and assets of the Company in accordance with Section 5.01 of
this Indenture,  the successor Person formed by such consolidation or into which
the  Company  is merged or to which  such sale,  conveyance,  transfer  or other
disposition is made shall succeed to,

                                       50
<PAGE>

and be  substituted  for, and may exercise every right and power of, the Company
under this Indenture  with the same effect as if such successor  Person had been
named as the Company herein.

                                   ARTICLE SIX
                              DEFAULT AND REMEDIES

          SECTION  6.01.  EVENTS OF DEFAULT.  An "EVENT OF DEFAULT"  shall occur
with respect to the Notes if:

          (a) the Company  defaults in the payment of  principal of (or premium,
     if any,  on) any Note when the same  becomes due and  payable at  maturity,
     upon acceleration, redemption or otherwise;

          (b) the  Company  defaults in the payment of interest on any Note when
     the same becomes due and payable,  and such default  continues for a period
     of 30  days;  PROVIDED  that a  failure  to  make  any of the  first  three
     scheduled interest payments on the Notes in a timely manner will constitute
     an Event of Default with no grace or cure period;

          (c)  the  Company  defaults  in  the  performance  or  breach  of  the
     provisions  of Article Five hereof or fails to make or  consummate an Offer
     to Purchase in accordance with Section 4.11 or Section 4.12 hereof;

          (d) the Company  defaults in the  performance of or breaches any other
     covenant or agreement  of the Company in this  Indenture or under the Notes
     (other than a default  specified  in clause (a), (b) or (c) of this Section
     6.01) and such default or breach  continues for a period of 30  consecutive
     days after  written  notice by the Trustee or the Holders of 25% or more in
     aggregate principal amount of the Notes;

          (e) there occurs with  respect to any issue or issues of  Indebtedness
     of  the  Company  or  any  Significant  Subsidiary  having  an  outstanding
     principal  amount  of $10  million  or more in the  aggregate  for all such
     issues of all such Persons,  whether such  Indebtedness now exists or shall
     hereafter  be created,  (I) an event of default  that has caused the holder
     thereof to declare  such  Indebtedness  to be due and payable  prior to its
     Stated  Maturity and such  Indebtedness  has not been discharged in full or
     such acceleration has not been rescinded or annulled within 30 days of such
     acceleration  and/or (II) the  failure to make a  principal  payment at the
     final (but not any interim) fixed maturity and such defaulted payment shall
     not have been  made,  waived  or  extended  within 30 days of such  payment
     default;

          (f) any final  judgment or order (not  covered by  insurance)  for the
     payment  of money in excess of $10  million in the  aggregate  for all such
     final   judgments  or  orders  against  all  such  Persons   (treating  any
     deductibles,  self-insurance  or  retention  as not so  covered)  shall  be
     rendered against the Company or any Significant Subsidiary and shall not be
     paid or discharged,  and there shall be any period of 60  consecutive  days
     following  entry of the final  judgment or order that causes the  aggregate

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<PAGE>

     amount for all such final  judgments or orders  outstanding and not paid or
     discharged  against all such  Persons to exceed $10 million  during which a
     stay of enforcement of such final judgment or order, by reason of a pending
     appeal or otherwise, shall not be in effect;

          (g) a court having  jurisdiction  in the  premises  enters a decree or
     order  for  (A)  relief  in  respect  of the  Company  or  any  Significant
     Subsidiary  in  an  involuntary  case  under  any  applicable   bankruptcy,
     insolvency or other similar law now or hereafter in effect, (B) appointment
     of a receiver,  liquidator,  assignee,  custodian, trustee, sequestrator or
     similar official of the Company or any Significant Subsidiary or for all or
     substantially  all  of the  property  and  assets  of  the  Company  or any
     Significant  Subsidiary or (C) the winding up or liquidation of the affairs
     of the Company or any Significant Subsidiary and, in each case, such decree
     or order shall remain unstayed and in effect for a period of 60 consecutive
     days; or

          (h)  the  Company  or  any  Significant  Subsidiary  (A)  commences  a
     voluntary case under any applicable bankruptcy, insolvency or other similar
     law now or  hereafter  in effect,  or consents to the entry of an order for
     relief in an  involuntary  case  under any such law,  (B)  consents  to the
     appointment of or taking  possession by a receiver,  liquidator,  assignee,
     custodian,  trustee, sequestrator or similar official of the Company or any
     Significant  Subsidiary or for all or substantially all of the property and
     assets of the  Company or any  Significant  Subsidiary  or (C)  effects any
     general assignment for the benefit of creditors.

          SECTION  6.02.  ACCELERATION.  If an Event of Default  (other  than an
Event of Default specified in clause (g) or (h) of Section 6.01 that occurs with
respect to the  Company)  occurs and is  continuing  under this  Indenture,  the
Trustee or the  Holders  of at least 25% in  aggregate  principal  amount of the
Notes then outstanding,  by written notice to the Company (and to the Trustee if
such  notice is given by the  Holders),  may,  and the Trustee at the request of
such  Holders  shall,  declare the  principal  amount of,  premium,  if any, and
accrued  interest  on the  Notes  to be  immediately  due  and  payable.  Upon a
declaration of  acceleration,  such principal  amount of,  premium,  if any, and
accrued  interest  shall  be  immediately  due and  payable.  In the  event of a
declaration of acceleration  because an Event of Default set forth in clause (e)
of Section 6.01 has occurred and is continuing, such declaration of acceleration
shall be automatically rescinded and annulled if the event of default triggering
such Event of Default  pursuant  to clause (e) shall be remedied or cured by the
Company or the relevant  Significant  Subsidiary or waived by the holders of the
relevant  Indebtedness within 60 days after the declaration of acceleration with
respect  thereto.  If an Event of  Default  specified  in  clause  (g) or (h) of
Section  6.01 occurs  with  respect to the  Company,  the  principal  amount of,
premium,  if any, and accrued interest on the Notes then outstanding  shall IPSO
FACTO become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Holder.

          The  Holders  of at  least  a  majority  in  principal  amount  of the
outstanding  Notes,  by written  notice to the Company and to the  Trustee,  may
waive all past defaults and rescind and annul a declaration of acceleration  and
its  consequences  if (i)  all  existing  Events  of  Default,  other  than  the

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<PAGE>

nonpayment of the principal of, premium,  if any, and interest on the Notes that
have become due solely by such declaration of  acceleration,  have been cured or
waived and (ii) the rescission would not conflict with any judgment or decree of
a court of competent jurisdiction.

          SECTION 6.03.  OTHER  REMEDIES.  If an Event of Default  occurs and is
continuing,  the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of,  premium,  if any, or interest
on the Notes or to enforce the performance of any provision of the Notes or this
Indenture.

          The Trustee may maintain a proceeding  even if it does not possess any
of the Notes or does not produce any of them in the proceeding.

          SECTION 6.04. WAIVER OF PAST DEFAULTS. Subject to Section 9.02, at any
time after such a declaration of  acceleration,  but before a judgment or decree
for the payment of the money due has been  obtained by the Trustee,  the Holders
of at least a majority in aggregate principal amount of the outstanding Notes by
written notice to the Company and to the Trustee may waive all past Defaults and
rescind and annul a declaration of acceleration and its  consequences  (except a
Default in the payment of principal of premium,  if any, or interest on any Note
as  specified  in clause (a) or (b) of Section 6.01 (but not as a result of such
acceleration)  or in respect of a covenant or provision of this Indenture  which
cannot  be  modified  or  amended  without  the  consent  of the  Holder of each
outstanding Note affected) if (i) all existing Events of Default, other than the
nonpayment  of the  principal  amount of,  premium,  if any, and interest on the
Notes that have become due solely by such declaration of acceleration, have been
cured or waived and (ii) the rescission  would not conflict with any judgment or
decree of a court of competent jurisdiction.  Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been  cured,  for every  purpose of this  Indenture;  but no such waiver
shall extend to any  subsequent  or other  Default or Event of Default or impair
any right consequent thereto.

          SECTION 6.05. CONTROL BY MAJORITY.  The Holders of at least a majority
in  aggregate  principal  amount of the  outstanding  Notes may direct the time,
method and place of conducting any  proceeding  for any remedy  available to the
Trustee or exercising any trust or power conferred on the Trustee.  However, the
Trustee  may  refuse to follow any  direction  that  conflicts  with law or this
Indenture,  that may  involve the  Trustee in  personal  liability,  or that the
Trustee  determines  in good  faith may be unduly  prejudicial  to the rights of
Holders of the Notes,  not joining in the giving of such  direction and may take
any  other  action  it  deems  proper  that is not  inconsistent  with  any such
direction received from Holders of the Notes.

          SECTION 6.06.  LIMITATION ON SUITS. A Holder may not pursue any remedy
with respect to this Indenture or the Notes unless:

                                       53
<PAGE>

          (i) the Holder gives the Trustee written notice of a continuing  Event
     of Default;

          (ii) the  Holders  of at least 25% in  aggregate  principal  amount of
     outstanding  Notes  make a written  request  to the  Trustee  to pursue the
     remedy;

          (iii) such Holder or Holders offer the Trustee indemnity  satisfactory
     to the Trustee against any costs, liability or expense;

          (iv) the Trustee does not comply with the request within 60 days after
     receipt of the request and the offer of indemnity; and

          (v) during such 60-day period,  the Holders of a majority in aggregate
     principal  amount  of the  outstanding  Notes  do not give  the  Trustee  a
     direction that is inconsistent with the request.

          For purposes of Section 6.05 of this  Indenture and this Section 6.06,
the Trustee shall comply with TIA Section 316(a) in making any  determination of
whether the Holders of the required  aggregate  principal  amount of outstanding
Notes have  concurred  in any request or  direction of the Trustee to pursue any
remedy available to the Trustee or the Holders with respect to this Indenture or
the Notes or otherwise under the law.

          A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.

          SECTION 6.07.  RIGHTS OF HOLDERS TO RECEIVE  PAYMENT.  Notwithstanding
any other  provision  of this  Indenture,  the right of any  Holder of a Note to
receive payment of principal of,  premium,  if any, or interest on such Holder's
Note on or after the  respective  due dates  expressed on such Note, or to bring
suit for the enforcement of any such payment on or after such respective  dates,
shall not be impaired or affected without the consent of such Holder.

          SECTION 6.08.  COLLECTION  SUIT BY TRUSTEE.  If an Event of Default in
payment of  principal,  premium or  interest  specified  in clause (a) or (b) of
Section 6.01 of this Indenture occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express  trust against the Company
or any other obligor of the Notes for the whole amount of principal, premium, if
any, and accrued interest  remaining  unpaid,  together with interest on overdue
principal,  premium, if any, and, to the extent that payment of such interest is
lawful,  interest on overdue installments of interest,  in each case at the rate
specified in the Notes,  and such further amount as shall be sufficient to cover
the costs and expenses of  collection,  including the  reasonable  compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof.

                                       54
<PAGE>

          SECTION 6.09.  TRUSTEE MAY FILE PROOFS OF CLAIM.  The Trustee may file
such  proofs of claim  and other  papers or  documents  as may be  necessary  or
advisable  in order to have the claims of the Trustee  (including  any claim for
the  reasonable  compensation,  expenses,  disbursements  and  advances  of  the
Trustee,  its agents and counsel,  and any other  amounts due the Trustee  under
Section 7.07) and the Holders  allowed in any judicial  proceedings  relative to
the Company (or any other  obligor of the Notes),  its creditors or its property
and the  Trustee  shall be  entitled  and  empowered  to collect and receive any
monies,  securities or other property  payable or deliverable upon conversion or
exchange of the Notes or upon any such claims and to  distribute  the same,  and
any custodian,  receiver, assignee, trustee,  liquidator,  sequestrator or other
similar  official in any such judicial  proceeding is hereby  authorized by each
Holder to make such  payments to the Trustee  and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders,  to pay to
the  Trustee  any amount due to it for the  reasonable  compensation,  expenses,
disbursements and advances of the Trustee,  its agent and counsel, and any other
amounts due the Trustee under Section 7.07.  Nothing herein  contained  shall be
deemed to empower the Trustee to  authorize or consent to, or accept or adopt on
behalf of any Holder,  any plan of  reorganization,  arrangement,  adjustment or
composition  affecting  the Notes or the  rights of any  Holder  thereof,  or to
authorize  the Trustee to vote in respect of the claim of any Holder in any such
proceeding.

          SECTION 6.10.  PRIORITIES.  If the Trustee collects any money pursuant
to this Article Six, it shall pay out the money in the following order:

          FIRST: to the Trustee for all amounts due under Section 7.07;

          SECOND:  to Holders for amounts then due and unpaid for  principal of,
     premium,  if any,  and interest on the Notes in respect of which or for the
     benefit of which such money has been collected, ratably, without preference
     or priority of any kind,  according  to the amounts due and payable on such
     Notes for principal, premium, if any, and interest, respectively; and

          THIRD: to the Company.

          The  Trustee,  upon prior  written  notice to the  Company,  may fix a
record date and payment date for any payment to Holders pursuant to this Section
6.10.

          SECTION 6.11.  UNDERTAKING  FOR COSTS. In any suit for the enforcement
of any right or remedy  under this  Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee,  a court may require any party
litigant in such suit to file an  undertaking  to pay the costs of the suit, and
the court may assess reasonable costs,  including reasonable attorneys' fees and
expenses, against any party litigant in the suit having due regard to the merits
and good  faith of the  claims  or  defenses  made by the party  litigant.  This
Section 6.11 does not apply

                                       55
<PAGE>

to a suit by the  Trustee,  a suit by a Holder  pursuant to Section 6.07 of this
Indenture,  or a suit by  Holders  of more than 10% in  principal  amount of the
outstanding Notes.

          SECTION 6.12.  RESTORATION  OF RIGHTS AND REMEDIES.  If the Trustee or
any Holder has  instituted  any  proceeding to enforce any right or remedy under
this Indenture and such  proceeding has been  discontinued  or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then,
and in every such case,  subject to any  determination in such  proceeding,  the
Company,   the  Trustee  and  the  Holders  shall  be  restored   severally  and
respectively to their former  positions  hereunder and thereafter all rights and
remedies of the Company, the Trustee and the Holders shall continue as though no
such proceeding had been instituted.

          SECTION  6.13.  RIGHTS AND  REMEDIES  CUMULATIVE.  Except as otherwise
provided with respect to the  replacement  or payment of  mutilated,  destroyed,
lost or  wrongfully  taken  Notes in  Section  2.09,  no right or remedy  herein
conferred  upon or  reserved  to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent  permitted by law, be cumulative and in addition to every other right and
remedy  given  hereunder  or now or  hereafter  existing  at law or in equity or
otherwise.  The  assertion or employment  of any right or remedy  hereunder,  or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

          SECTION  6.14.  DELAY OR OMISSION NOT WAIVER.  No delay or omission of
the Trustee or of any Holder to exercise any right or remedy  accruing  upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an  acquiescence  therein.  Every  right and remedy
given by this  Article  Six or by law to the  Trustee or to the  Holders  may be
exercised  from time to time,  and as often as may be deemed  expedient,  by the
Trustee or by the Holders, as the case may be.

                                  ARTICLE SEVEN
                                     TRUSTEE

          SECTION 7.01. GENERAL.  The duties and responsibilities of the Trustee
shall be as provided  by the TIA and as set forth  herein.  Notwithstanding  the
foregoing, no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its  duties  hereunder,  or in the  exercise  of any of its  rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate  indemnity  against such risk or  liability is not  reasonably
assured to it. Whether or not therein expressly so provided,  every provision of
this  Indenture  relating  to the  conduct  or  affecting  the  liability  of or
affording  protection to the Trustee shall be subject to the  provisions of this
Article Seven.

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<PAGE>

          SECTION  7.02.  CERTAIN  RIGHTS OF  TRUSTEE.  Subject to TIA  Sections
315(a) through (d):

          (i) the Trustee may conclusively rely and shall be protected in acting
     or  refraining  from acting upon any  resolution,  certificate,  statement,
     instrument,  opinion, report, notice, request,  direction,  consent, order,
     bond,  debenture,  note,  other evidence of  indebtedness or other paper or
     document  (whether in its original or facsimile  form) believed by it to be
     genuine  and to have been signed or  presented  by the proper  person.  The
     Trustee need not  investigate any fact or matter stated in the document and
     may in good faith  conclusively  rely as to the truth of the statements and
     the correctness of the opinions therein;

          (ii) before the Trustee acts or refrains  from acting,  it may require
     an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
     liable for any  action it takes or omits to take in good faith in  reliance
     on such certificate, opinion and/or an accountants' certificate if required
     under the TIA;

          (iii) the Trustee may act through its  attorneys  and agents and shall
     not be responsible  for the misconduct or negligence of any agent appointed
     with due care;

          (iv) the Trustee  shall be under no  obligation to exercise any of the
     rights or powers vested in it by this Indenture at the request or direction
     of any of the  Holders,  unless  such  Holders  shall  have  offered to the
     Trustee  security or indemnity  reasonably  satisfactory  to it against the
     costs,  expenses and liabilities  that might be incurred by it in complying
     with such request or direction;

          (v) the  Trustee  shall not be liable for any action it takes or omits
     to take in good  faith  that it  believes  to be  authorized  or within its
     rights or powers or for any action it takes or omits to take in  accordance
     with the direction of the Holders of a majority in principal  amount of the
     outstanding  Notes relating to the time, method and place of conducting any
     proceeding for any remedy available to the Trustee, or exercising any trust
     or power conferred upon the Trustee,  under this  Indenture;  PROVIDED that
     the Trustee's conduct does not constitute negligence or bad faith;

          (vi)  whenever in the  administration  of this  Indenture  the Trustee
     shall deem it  desirable  that a matter be proved or  established  prior to
     taking,  suffering  or omitting to take any action  hereunder,  the Trustee
     (unless  other  evidence  be herein  specifically  prescribed)  may, in the
     absence of bad faith on its part, rely upon an Officers' Certificate;

          (vii) the Trustee  shall not be bound to make any  investigation  into
     the facts or  matters  stated in any  resolution,  certificate,  statement,
     instrument,  opinion, report, notice, request,  direction,  consent, order,
     bond,  debenture,  note,  other evidence of  indebtedness or other paper or
     document, but the Trustee, in its discretion, may make such further inquiry
     or investigation  into such facts or matters as it may see fit, and, if the
     Trustee shall determine to make such further inquiry or  investigation,  it
     shall be  entitled  at the sole cost of the  Company to examine  the books,

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     records and premises of the Company  personally or by agent or attorney and
     shall incur no liability or  additional  liability of any kind by reason of
     such inquiry or investigation;

          (viii) the Trustee shall not be charged with  knowledge of any Default
     or Event of Default,  the identity of any  Restricted  Subsidiary or of the
     existence  of any  Change of  Control  or Asset  Sale  unless  either (i) a
     Responsible  Officer  shall  have  actual  knowledge  thereof,  or (ii) the
     Trustee shall have received  written notice thereof from the Company or any
     Holder of the Notes; and

          (ix) the Trustee may consult  with  counsel of its  selection  and the
     advice of such counsel or any Opinion of Counsel shall be full and complete
     authorization  and  protection in respect of any action taken,  suffered or
     omitted to be taken by it hereunder in good faith and in reliance thereon.

          SECTION  7.03.  INDIVIDUAL  RIGHTS OF  TRUSTEE.  The  Trustee,  in its
individual or any other  capacity,  may become the owner or pledgee of Notes and
may otherwise  deal with the Company or its  Affiliates  with the same rights it
would  have if it were not the  Trustee.  Any  Agent  may do the same  with like
rights. However, the Trustee is subject to TIA Sections 310(b) and 311.

          SECTION  7.04.  TRUSTEE'S   DISCLAIMER.   The  Trustee  (a)  makes  no
representation  as to the  validity or adequacy of this  Indenture or the Notes,
(b)  shall  not be  accountable  for the  Company's  use or  application  of the
proceeds of the Notes and (c) shall not be responsible  for any statement in the
Notes other than its certificate of authentication.

          SECTION  7.05.  NOTICE  OF  DEFAULT.  If any  Default  or any Event of
Default  occurs  and is  continuing  and if such  Default or Event of Default is
known to a  Responsible  Officer of the Trustee,  the Trustee shall mail to each
Holder in the manner and to the extent  provided in TIA Section 313(c) notice of
the  Default or Event of Default  within 90 days  after it occurs,  unless  such
Default or Event of Default has been cured;  PROVIDED,  HOWEVER, that, except in
the case of a default in the payment of the  principal of,  premium,  if any, or
interest on any Note, the Trustee shall be protected in withholding  such notice
if and as long as the board of  directors,  the  executive  committee or a trust
committee of directors and/or Responsible  Officers of the Trustee in good faith
determine that the withholding of such notice is in the interest of the Holders.
If an Event of Default has occurred and is continuing, the Trustee shall use the
same degree of care and skill in its exercise of the rights and powers  invested
in it under  this  Indenture  as a  prudent  person  would  exercise  under  the
circumstances in the conduct of such person's own affairs.

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          SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS. Within 60 days after each
May 15,  beginning  with May 15, 2000,  the Trustee shall mail to each Holder as
provided in TIA Section  313(c) a brief  report that  complies  with TIA Section
313(a) dated as of such May 15, if required by TIA Section 313(a).

          SECTION 7.07. COMPENSATION AND INDEMNITY. The Company shall pay to the
Trustee such  compensation  as shall be agreed upon from time to time in writing
for its services.  The  compensation  of the Trustee shall not be limited by any
law on  compensation  of a  trustee  of an  express  trust.  The  Company  shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses and
advances  incurred  or made by the  Trustee.  Such  expenses  shall  include the
reasonable compensation and expenses of the Trustee's agents and counsel.

          The Company shall  indemnify the Trustee and any  predecessor  trustee
for, and hold it harmless against,  any and all loss, claim, damage or liability
or  expense  (including  taxes  other  than  taxes  based upon the income of the
Trustee and  reasonable  compensation  and expenses of the Trustee's  agents and
counsel)  incurred  by it  without  negligence  or  bad  faith  on its  part  in
connection  with the  acceptance  or  administration  of this  Indenture and its
duties under this  Indenture and the Notes,  including the costs and expenses of
defending  itself  against  any claim or  liability  and of  complying  with any
process served upon it or any of its officers in connection with the exercise or
performance  of any of its powers or duties under this  Indenture and the Notes.
The Trustee shall notify the Company  promptly of any claim asserted against the
Trustee for which it may seek indemnity.  The Company shall defend the claim and
the Trustee shall provide reasonable cooperation at the Company's expense in the
defense.  The Trustee may have separate counsel of its selection and the Company
shall pay the reasonable fees and expenses of such counsel;  PROVIDED,  that the
Company  will not be  required  to pay such fees and  expenses if it assumes the
Trustee's  defense and there is no conflict of interest  between the Company and
the Trustee in connection  with such  defense.  The Company need not pay for any
settlement made without its written consent.

          To secure the Company's payment  obligations in this Section 7.07, the
Trustee shall have a lien prior to the Noteholders on all money or property held
or  collected  by the  Trustee,  in its  capacity  as Trustee,  except  money or
property  held in trust to pay principal  of,  premium,  if any, and interest on
particular Notes.

          If  the  Trustee  incurs  expenses  or  renders   services  after  the
occurrence  of an Event of  Default  specified  in clause  (h) or (i) of Section
6.01,  the expenses and the  compensation  for the services  will be intended to
constitute  expenses  of  administration  under  Title 11 of the  United  States
Bankruptcy  Code or any  applicable  federal  or  state  law for the  relief  of
debtors.

          The rights, privileges, protections and benefits given to the Trustee,
including,  without limitation,  its rights to be indemnified,  are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder.

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<PAGE>

          The  provisions of this Section 7.07 shall survive the  resignation or
removal  of the  Trustee  and  the  defeasance  or  other  termination  of  this
Indenture.

          SECTION 7.08.  REPLACEMENT OF TRUSTEE. A resignation or removal of the
Trustee and appointment of a successor  Trustee shall become effective only upon
the  successor  Trustee's  acceptance  of its  appointment  as  provided in this
Section 7.08.

          The  Trustee  may resign at any time by so  notifying  the  Company in
writing  at least 30 days  prior to the date of the  proposed  resignation.  The
Holders of a majority in principal  amount of the  outstanding  Notes may remove
the Trustee by so  notifying  the Trustee in writing and may appoint a successor
Trustee with the consent of the Company.  The Company may at any time remove the
Trustee,  by  Company  Order  given at  least  30 days  prior to the date of the
proposed  removal;  PROVIDED  that, at such date, no Event of Default shall have
occurred and be continuing.

          If the Trustee  resigns or is removed,  or if a vacancy  exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.  Within one year after the successor Trustee takes office,  the Holders
of a  majority  in  principal  amount of the  outstanding  Notes  may  appoint a
successor Trustee to replace the successor Trustee appointed by the Company.  If
the successor  Trustee does not deliver its written  acceptance  required by the
next succeeding paragraph of this Section 7.08 within 30 days after the retiring
Trustee resigns or is removed,  the retiring Trustee, the Company or the Holders
of a majority in principal  amount of the outstanding  Notes may petition at the
expense of the Company any court of competent  jurisdiction  for the appointment
of a successor Trustee.

          A  successor  Trustee  shall  deliver  a  written  acceptance  of  its
appointment to the retiring  Trustee and to the Company.  Immediately  after the
delivery of such  written  acceptance,  subject to the lien  provided in Section
7.07 of this  Indenture,  (i) the retiring  Trustee shall  transfer all property
held by it as Trustee to the successor Trustee,  (ii) the resignation or removal
of the retiring Trustee shall become  effective and (iii) the successor  Trustee
shall  have  all the  rights,  powers  and  duties  of the  Trustee  under  this
Indenture.  A  successor  Trustee  shall mail notice of its  succession  to each
Holder.

          If the  Trustee  is no  longer  eligible  under  Section  7.10 of this
Indenture,  any Holder who satisfies the  requirements of TIA Section 310(b) may
petition any court of competent  jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.

          The Company  shall give notice of any  resignation  and any removal of
the Trustee and each  appointment  of a successor  Trustee to all Holders.  Each
notice shall  include the name of the  successor  Trustee and the address of its
Corporate Trust Office.

          SECTION  7.09.  SUCCESSOR  TRUSTEE  BY  MERGER,  ETC.  If the  Trustee
consolidates  with,  merges or converts into, or transfers all or  substantially
all of its corporate trust business to, another

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<PAGE>

corporation  or  national  banking  association,  the  resulting,  surviving  or
transferee  corporation or national banking  association without any further act
shall be the successor  Trustee with the same effect as if the successor Trustee
had been named as the Trustee herein.

          SECTION 7.10. ELIGIBILITY.  This Indenture shall always have a Trustee
who satisfies the  requirements  of TIA Sections  310(a)(1) and  310(a)(5).  The
Trustee shall have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition.

          SECTION 7.11. MONEY HELD IN TRUST. The Trustee shall not be liable for
interest  on any money  received  by it except as the Trustee may agree with the
Company in writing.  Money held in trust by the Trustee  need not be  segregated
from other funds except to the extent  required by law and except for money held
in trust under Article Eight of this Indenture.

          SECTION  7.12.  WITHHOLDING  TAXES.  The  Trustee,  as  agent  for the
Company,  shall exclude and withhold from each payment of principal and interest
and other amounts due hereunder or under the Notes any and all withholding taxes
applicable  thereto  as  required  by law.  The  Trustee  agrees  to act as such
withholding agent and, in connection  therewith,  whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Notes,  to  withhold  such  amounts and timely pay the
same to the appropriate authority in the name of and on behalf of the Holders of
the Notes, that it will file any necessary withholding tax returns or statements
when due, and that, as promptly as possible after the payment  thereof,  it will
deliver  to each  Holder  of a Note  appropriate  documentation  evidencing  the
payment  thereof,  together with such  additional  documentary  evidence as such
Holders may reasonably request from time to time.

                                  ARTICLE EIGHT
                             DISCHARGE OF INDENTURE

          SECTION  8.01.  TERMINATION  OF THE COMPANY'S  OBLIGATIONS.  Except as
otherwise  provided  in  this  Section  8.01,  the  Company  may  terminate  its
obligations under the Notes and this Indenture if:

          (i) all Notes  previously  authenticated  and  delivered  (other  than
     destroyed,  lost or stolen Notes that have been  replaced or Notes that are
     paid  pursuant to Section 4.01 hereof or Notes for whose  payment  money or
     securities have theretofore been held in trust and thereafter repaid to the
     Company,  as provided in Section 8.05  hereof)  have been  delivered to the
     Trustee for  cancellation  and the Company has paid all sums  payable by it
     hereunder; or

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          (ii) (A) all of the Notes mature within one year or all of them are to
     be called for redemption within one year under arrangements satisfactory to
     the Trustee for giving the notice of redemption,  (B) the Company  deposits
     in trust with the Trustee during such one-year  period,  under the terms of
     an irrevocable  trust  agreement in form and substance  satisfactory to the
     Trustee,  as trust  funds  solely for the  benefit of the  Holders for that
     purpose,  money  or  European  Government  Obligations  sufficient  to  pay
     principal,  premium,  if,  any,  and  interest  on the Notes to maturity or
     redemption,  as the case may be,  and to pay all other  sums  payable by it
     hereunder,  (C) no Default or Event of  Default  with  respect to the Notes
     shall have occurred and be continuing on the date of such deposit, (D) such
     deposit  will not  result in a breach or  violation  of,  or  constitute  a
     default under, this Indenture or any other agreement or instrument to which
     the  Company  is a party or by which it is  bound,  (E) if at such time the
     Notes are listed on a national securities  exchange,  the Notes will not be
     delisted as a result of such  deposit,  defeasance or discharge and (F) the
     Company  has  delivered  to the  Trustee an  Officers'  Certificate  and an
     Opinion of Counsel,  in each case  stating  that all  conditions  precedent
     provided  for herein  relating to the  satisfaction  and  discharge of this
     Indenture have been complied with.

          With respect to the foregoing  clause (i), the  Company's  obligations
under Section 7.07 hereof shall  survive.  With respect to the foregoing  clause
(ii), the Company's  obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07,
2.08,  2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 of this Indenture
shall survive until the Notes are no longer  outstanding.  Thereafter,  only the
Company's  obligations in Sections 7.07,  8.05 and 8.06 of this Indenture  shall
survive.  After any such  irrevocable  deposit,  the Trustee upon request  shall
acknowledge in writing the discharge of the Company's  obligations,  as the case
may be,  under  the  Notes  and  this  Indenture,  except  for  those  surviving
obligations specified above.

          SECTION 8.02. DEFEASANCE AND DISCHARGE OF INDENTURE.  The Company will
be deemed to have paid and will be discharged  from any and all  obligations  in
respect of the Notes on the 123rd day after the deposit  referred to below,  and
the provisions of this Indenture will no longer be in effect with respect to the
Notes if:

          (A) the Company has deposited with the Trustee, in trust, money and/or
     European  Government  Obligations  that through the payment of interest and
     principal in respect  thereof in  accordance  with their terms will provide
     money in an amount sufficient to pay the principal of, premium, if any, and
     accrued  interest on the Notes on the Stated  Maturity of such  payments in
     accordance with the terms of this Indenture and the Notes;

          (B) the Company has delivered to the Trustee (i) either (1) an Opinion
     of Counsel to the effect that Holders will not  recognize  income,  gain or
     loss for federal income tax purposes as a result of the Company's  exercise
     of its option under this Section 8.02 and will be subject to federal income
     tax on the same  amount  and in the same  manner  and at the same  times as
     would have been the case if such deposit,  defeasance and discharge had not
     occurred, which Opinion of Counsel must be based upon (and accompanied by a
     copy of) a ruling of the Internal Revenue Service to the same effect unless

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<PAGE>

     there  has been a change in  applicable  federal  income  tax law after the
     Closing  Date  such that a ruling  is no  longer  required  or (2) a ruling
     directed to the Trustee  received from the Internal  Revenue Service to the
     same effect as the aforementioned Opinion of Counsel and (ii) an Opinion of
     Counsel to the effect that the  creation of the  defeasance  trust does not
     violate  the  Investment  Company  Act of 1940 and after the passage of 123
     days  following  the  deposit,  the trust  fund will not be  subject to the
     effect of Section 547 of the United States Bankruptcy Code or Section 15 of
     the New York Debtor and Creditor Law;

          (C)  immediately  after  giving  effect to such deposit on a PRO FORMA
     basis,  no Event of  Default,  or event  that after the giving of notice or
     lapse of time or both would become an Event of Default, shall have occurred
     and be  continuing  on the date of such deposit or during the period ending
     on the 123rd day after the date of such deposit, and such deposit shall not
     result in a breach or  violation  of, or  constitute a default  under,  any
     other  agreement  or  instrument  to  which  the  Company  or  any  of  its
     Subsidiaries is a party or by which the Company or any of its  Subsidiaries
     is bound; and

          (D) if at such  time the Notes are  listed  on a  national  securities
     exchange, the Company has delivered to the Trustee an Opinion of Counsel to
     the effect that the Notes will not be delisted as a result of such deposit,
     defeasance and discharge.

          Notwithstanding the foregoing,  prior to the end of the 123-day period
referred  to in clause  (B)(ii)  of this  Section  8.02,  none of the  Company's
obligations  under this Indenture shall be discharged.  Subsequent to the end of
such 123-day period with respect to this Section 8.02, the Company's obligations
in Sections 2.02,  2.03,  2.04,  2.05, 2.06, 2.07, 2.08, 2.09, 2.14, 4.01, 4.02,
4.17,  7.07,  7.08,  8.05 and 8.06 shall  survive  until the Notes are no longer
outstanding.  Thereafter,  only the Company's obligations in Sections 7.07, 8.05
and 8.06 shall survive.  If and when a ruling from the Internal  Revenue Service
or an Opinion of Counsel  referred to in clause  (B)(i) of this Section 8.02 may
be  provided  specifically  without  regard to, and not in  reliance  upon,  the
continuance of the Company's  obligations under Section 4.01, then the Company's
obligations  under such Section 4.01 shall cease upon delivery to the Trustee of
such  ruling or Opinion  of Counsel  and  compliance  with the other  conditions
precedent  provided for herein  relating to the defeasance  contemplated by this
Section 8.02.

          After the 123 day period referred to in clause (B)(ii) of this Section
8.02, the Trustee upon Company Order shall  acknowledge in writing the discharge
of the Company's obligations under the Notes and this Indenture except for those
surviving obligations in the immediately preceding paragraph.

          SECTION 8.03. DEFEASANCE OF CERTAIN OBLIGATIONS.  The Company may omit
to comply with any term,  provision or condition  set forth in clauses (iii) and
(iv) of Section 5.01 and  Sections  4.03  through  4.11 of this  Indenture,  and
clause (c) of  Section  6.01 with  respect to clauses  (iii) and (iv) of Section
5.01 of this  Indenture  and clause (d) of Section 6.01 with respect to Sections
4.01, 4.02 and 4.12 through 4.19 hereof, and clauses (e) and (f) of Section 6.01
hereof shall be deemed not to be Events of Default, upon:

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          (a) the  deposit,  in trust,  with the  Trustee  (or  another  trustee
     satisfying  the  requirements  of  Section  7.10  hereof)  of money  and/or
     European  Government  Obligations that, through the payment of interest and
     principal in respect thereof in accordance  with their terms,  will provide
     money in an amount sufficient to pay the principal of, premium, if any, and
     accrued  interest on the Notes on the Stated  Maturity of such  payments in
     accordance with the terms of this Indenture and the Notes;

          (b) the satisfaction of the provisions described in clauses B(ii), (C)
     and (D) of Section 8.02 hereof;

          (c) delivery by the Company to the Trustee of an Opinion of Counsel to
     the effect that,  the Holders will not recognize  income,  gain or loss for
     federal  income tax purposes as a result of such deposit and defeasance and
     will be subject to  federal  income tax on the same  amount and in the same
     manner and at the same  times as would  have been the case if such  deposit
     and defeasance had not occurred; and

          (d) the  Company  shall have  delivered  to the  Trustee an  Officers'
     Certificate  and an  Opinion  of  Counsel,  in each case  stating  that all
     conditions  precedent  provided  for  herein  relating  to  the  defeasance
     contemplated by this Section 8.03 have been complied with.

          SECTION 8.04. APPLICATION OF TRUST MONEY. Subject to Section 8.06, the
Trustee  or  Paying  Agent  shall  hold in trust  money or  European  Government
Obligations  deposited  with it pursuant to Section  8.01,  8.02 or 8.03, as the
case may be, and shall  apply the  deposited  money and the money from  European
Government  Obligations  in accordance  with the Notes and this Indenture to the
payment of principal of,  premium,  if any, and interest on the Notes;  but such
money need not be segregated  from other funds except to the extent  required by
law.

          SECTION 8.05.  REPAYMENT TO COMPANY.  Subject to Sections 7.07,  8.01,
8.02 and 8.03,  the  Trustee  and the Paying  Agent  shall  promptly  pay to the
Company any excess  money,  as  determined  by a nationally  recognized  firm of
independent  public  accountants  expressed in a written  certification  thereof
delivered to the Trustee,  and held by them at any time and  thereupon  shall be
relieved  from all  liability  with  respect to such money.  The Trustee and the
Paying  Agent shall pay to the Company  upon  request any money held by them for
the payment of principal,  premium,  if any, or interest that remains  unclaimed
for two years;  PROVIDED  that the Trustee or such  Paying  Agent  before  being
required  to make any payment  may cause to be  published  at the expense of the
Company  once in a newspaper of general  circulation  in the City of New York or
mail to each  Holder  entitled  to such money at such  Holder's  address (as set
forth in the Note Register)  notice that such money remains  unclaimed  provided
that the Trustee or such Paying Agent before being  required to make any payment
may give notice in  accordance  with Section  11.02(b)  that such money  remains
unclaimed and that after a date  specified  therein  (which shall be at least 30
days from the date of such publication or mailing) any unclaimed balance of such
money  then  remaining  will be  repaid to the  Company.  After  payment  to the
Company, Holders entitled to such money must look to the

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<PAGE>

Company for payment as general  creditors  unless an applicable  law  designates
another  Person,  and all  liability  of the Trustee and such Paying  Agent with
respect to such money shall cease.

          SECTION  8.06.  REINSTATEMENT.  If the Trustee or the Paying  Agent is
unable to apply any money or European Government  Obligations in accordance with
Section  8.01,  8.02 or  8.03,  as the  case  may be,  by  reason  of any  legal
proceeding  or by reason of any order or judgment  of any court or  governmental
authority enjoining,  restraining or otherwise prohibiting such application, the
Company's  obligations  under this  Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred  pursuant to Section 8.01,  8.02 or
8.03,  as the case may be,  until such time as the  Trustee  or Paying  Agent is
permitted  to  apply  all such  money  or  European  Government  Obligations  in
accordance  with Section 8.01,  8.02 or 8.03, as the case may be; PROVIDED that,
if the  Company  has made any  payment of  principal  of,  premium,  if any,  or
interest  on any Notes  because of the  reinstatement  of its  obligations,  the
Company  shall be  subrogated  to the  rights of the  Holders  of such  Notes to
receive such payment from the money or European  Government  Obligations held by
the Trustee or Paying Agent.

          SECTION 8.07.  DEFEASANCE AND CERTAIN OTHER EVENTS OF DEFAULT.  In the
event that the Company  exercises  its option to omit  compliance  with  certain
covenants and provisions of this Indenture with respect to the Notes pursuant to
Section  8.03 and  such  Notes  are  declared  due and  payable  because  of the
occurrence of an Event of Default that remains  applicable,  the amount of money
and/or  European  Government  Obligations  on deposit  with the Trustee  will be
sufficient  to pay  amounts  due on  such  Notes  at the  time of  their  Stated
Maturity.  If, in the event the Company  exercises its option to omit compliance
with certain  covenants  and  provisions of this  Indenture  with respect to the
Notes  pursuant  to Section  8.03 and such Notes are  declared  due and  payable
because of the  occurrence of an Event of Default that remains  applicable,  the
amount of money  and/or  European  Government  Obligations  on deposit  with the
Trustee  is  insufficient  to pay  amounts  due on the  Notes at the time of the
acceleration resulting from such Events of Default pursuant to Section 6.02, the
Company will remain liable for such payments.

                                  ARTICLE NINE
                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

          SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company, when authorized
by resolutions  of its Board of Directors (as evidenced by a Board  Resolution),
and the Trustee may amend or  supplement  this  Indenture  or the Notes  without
notice to, or the consent of, any Holder:

          (a) to cure any ambiguity,  defect or inconsistency in this Indenture;
     PROVIDED  that,  in the good faith opinion of the Board of Directors of the
     Company evidenced by a Board Resolution,  such amendments or supplements do
     not adversely affect the interests of the Holders in any material respect;

                                       65
<PAGE>

          (b) to comply with Article Five;

          (c) to comply with any  requirements  of the  Commission in connection
     with the qualification of this Indenture under the TIA;

          (d)  to  evidence  and  provide  for  the  acceptance  of  appointment
     hereunder by a successor Trustee; or

          (e) to make any change that, in the good faith opinion of the Board of
     Directors  of  the  Company  evidenced  by a  Board  Resolution,  does  not
     materially and adversely affect the rights of any Holder.

          SECTION  9.02.  WITH CONSENT OF HOLDERS.  Subject to Sections 6.07 and
without prior notice to the Holders,  the Company,  when authorized by its Board
of Directors  (as  evidenced by a Board  Resolution),  and the Trustee may amend
this  Indenture  and the Notes  with the  written  consent  of the  Holders of a
majority in aggregate  principal amount of the Notes then  outstanding,  and the
Holders  of  a  majority  in  aggregate  principal  amount  of  the  Notes  then
outstanding by written notice to the Trustee may waive compliance by the Company
with any provision of this Indenture or the Notes.

          Notwithstanding  the  provisions  of this  Section  9.02,  without the
consent of each Holder  affected  thereby,  an amendment or waiver,  including a
waiver pursuant to Section 6.04 hereof,  may not:

          (a) change the Stated Maturity of the principal of, or any installment
     of interest on, any Note;

          (b) reduce the  principal  amount of, or premium,  if any, or interest
     on, any Note;

          (c)  change the place or  currency  of  payment  of  principal  of, or
     premium, if any, or interest on, any Note;

          (d)  impair the right to  institute  suit for the  enforcement  of any
     payment on or after the Stated Maturity of any Note;

          (e) reduce the  above-stated  percentage  of  outstanding  Notes,  the
     consent of whose Holders is necessary to modify or amend this Indenture;

          (f) waive a default in the payment of principal of,  premium,  if any,
     or interest on the Notes; or

          (g) reduce the percentage or aggregate principal amount of outstanding
     Notes the consent of whose  Holders is necessary  for waiver of  compliance
     with  certain  provisions  of  this  Indenture  or for  waiver  of  certain
     defaults.

                                       66
<PAGE>

          It shall not be  necessary  for the consent of the Holders  under this
Section  9.02  to  approve  the  particular  form  of  any  proposed  amendment,
supplement or waiver,  but it shall be  sufficient if such consent  approves the
substance thereof.

          After an  amendment,  supplement  or waiver  under this  Section  9.02
becomes  effective,  the Trustee  shall mail to the Holders  affected  thereby a
notice briefly describing the amendment,  supplement or waiver. The Company will
mail supplemental indentures to Holders upon request. Any failure of the Company
to mail such  notice,  or any defect  therein,  shall not,  however,  in any way
impair or affect the validity of any such supplemental indenture or waiver.

          SECTION 9.03. REVOCATION AND EFFECT OF CONSENT.  Until an amendment or
waiver becomes effective, a consent to it by a Holder is a continuing consent by
the  Holder  and every  subsequent  Holder of a Note or  portion  of a Note that
evidences the same debt as the Note of the consenting  Holder,  even if notation
of the consent is not made on any Note.  However,  any such Holder or subsequent
Holder  may revoke  the  consent  as to its Note or  portion  of its Note.  Such
revocation  shall be  effective  only if the  Trustee  receives  the  notice  of
revocation  before  the  date  the  amendment,   supplement  or  waiver  becomes
effective. An amendment,  supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite  percentage
in principal amount of the outstanding Notes.

          The Company may, but shall not be obligated  to, fix a record date for
the purpose of  determining  the Holders  entitled to consent to any  amendment,
supplement or waiver. If a record date is fixed, then,  notwithstanding the last
two sentences of the  immediately  preceding  paragraph,  those Persons who were
Holders at such record date (or their duly  designated  proxies)  and only those
Persons shall be entitled to consent to such amendment,  supplement or waiver or
to revoke any consent previously given,  whether or not such Persons continue to
be Holders  after such record date.  No such consent shall be valid or effective
for more than 90 days after such record date.

          After an amendment,  supplement or waiver becomes effective,  it shall
bind every  Holder  unless it is of the type  described  in any of  clauses  (i)
through  (vii) of Section  9.02.  In case of an  amendment or waiver of the type
described in clauses (i) through (vii) of Section 9.02,  the amendment or waiver
shall bind each Holder who has consented to it and every subsequent  Holder of a
Note that evidences the same indebtedness as the Note of the consenting Holder.

          SECTION  9.04.  NOTATION  ON OR EXCHANGE  OF NOTES.  If an  amendment,
supplement  or waiver  changes the terms of a Note,  the Trustee may require the
Holder to  deliver  it to the  Trustee.  The  Trustee  may place an  appropriate
notation on the Note about the changed terms and return it to the Holder and the
Trustee may place an appropriate notation on any Note thereafter  authenticated.
Alternatively,  if the  Company or the  Trustee so  determines,  the  Company in
exchange for the Note shall issue and the Trustee shall  authenticate a new Note
that reflects the changed terms.

                                       67
<PAGE>

          SECTION 9.05.  TRUSTEE TO SIGN  AMENDMENTS,  ETC. The Trustee shall be
entitled to receive,  and shall be fully  protected in relying upon, in addition
to the documents  required by Section 11.03,  an Opinion of Counsel stating that
the execution of any amendment, supplement or waiver authorized pursuant to this
Article  Nine is  authorized  or  permitted  by this  Indenture.  Subject to the
preceding sentence, the Trustee shall sign such amendment,  supplement or waiver
if the same does not  adversely  affect the rights of the  Trustee.  The Trustee
may, but shall not be obligated to,  execute any such  amendment,  supplement or
waiver that affects the  Trustee's own rights,  duties or immunities  under this
Indenture or otherwise.

          SECTION 9.06.  CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
indenture   executed  pursuant  to  this  Article  Nine  shall  conform  to  the
requirements of the TIA as then in effect.

                                   ARTICLE TEN
                                   [RESERVED]

                                 ARTICLE ELEVEN
                                  MISCELLANEOUS

          SECTION 11.01. TRUST INDENTURE ACT OF 1939. Prior to the effectiveness
of the Registration Statement,  this Indenture shall incorporate and be governed
by the  provisions  of the TIA that are  required or deemed to be part of and to
govern  indentures  qualified  under  the TIA.  After the  effectiveness  of the
Registration Statement, this Indenture shall be subject to the provisions of the
TIA that are required or deemed to be a part of this Indenture and shall, to the
extent applicable, be governed by such provisions.

          SECTION  11.02.  NOTICES.  (a) Any  notice or  communication  shall be
sufficiently  given if in  writing  and  delivered  in person or mailed by first
class mail, commercial courier service or telecopier communication, addressed as
follows:

          IF TO THE COMPANY:

                  Viatel, Inc.
                  685 Third Avenue
                  New York, NY 10017
                  Telecopier Number:  (212) 350-9250
                  Attention: General Counsel

          With, in the case of any notice given  pursuant to Article Six, a copy
to:

                                       68
<PAGE>

                  Kelley Drye & Warren LLP
                  101 Park Avenue
                  New York, NY  10178
                  Telecopier Number:  (212) 808-7897
                  Attention: Patricia Lee, Esq.

          IF TO THE TRUSTEE:

                  The Bank of New York
                  101 Barclay Street, Floor 21 West
                  New York, NY 10286
                  Telecopier Number:  (212) 815-5915
                  Attention:  Corporate Trust Administration

          The Company,  the Trustee,  or the  Depository by notice to the others
may  designate  additional  or different  addresses  for  subsequent  notices or
communications.

          All  notices  and  communications  (other  than those sent to Holders)
shall be deemed  to have been duly  given:  at the time  delivered  by hand,  if
personally  delivered;  five  Business  Days after being  deposited in the mail,
postage prepaid, if mailed; when receipt  acknowledged,  if telecopied;  and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.

          (b) Any notice or  communication  mailed to a Holder shall be mailed
to him at his address as it appears on the Note Register by first class mail and
shall be  sufficiently  given to him if so mailed  within  the time  prescribed.
Copies of any such  communication  or notice to a Holder shall also be mailed to
the Trustee and each Agent at the same time.

          Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.  Except for a
notice to the Trustee,  which is deemed given only when received,  and except as
otherwise provided in this Indenture,  if a notice or communication is mailed in
the manner provided in this Section 11.02, it is duly given,  whether or not the
addressee receives it.

          (c) Where  this  Indenture  provides for notice in any manner,  such
notice may be waived in writing by the Person  entitled to receive  such notice,
either  before or after the event,  and such waiver shall be the  equivalent  of
such notice.  Waivers of notice by Holders shall be filed with the Trustee,  but
such filing  shall not be a condition  precedent  to the  validity of any action
taken in reliance upon such waiver.

          In case by reason of the  suspension  of  regular  mail  service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such  notification  as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

                                       69
<PAGE>

          SECTION  11.03.  CERTIFICATE  AND OPINION AS TO CONDITIONS  PRECEDENT.
Upon any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:

          (a) an  Officers'  Certificate  stating  that,  in the  opinion of the
     signers, all conditions  precedent,  if any, provided for in this Indenture
     relating to the proposed action have been complied with; and

          (b) an  Opinion  of  Counsel  stating  that,  in the  opinion  of such
     Counsel, all such conditions precedent have been complied with.

          SECTION 11.04.  STATEMENTS  REQUIRED IN  CERTIFICATE OR OPINION.  Each
certificate  or opinion with respect to compliance  with a condition or covenant
provided for in this Indenture shall include:

          (a) a statement that each person  signing such  certificate or opinion
     has read such covenant or condition  and the  definitions  herein  relating
     thereto;

          (b) a brief statement as to the nature and scope of the examination or
     investigation  upon  which  the  statement  or  opinion  contained  in such
     certificate or opinion is based;

          (c) a statement that, in the opinion of each such person,  he has made
     such  examination or investigation as is necessary to enable him to express
     an informed  opinion as to whether or not such  covenant or  condition  has
     been complied with; and

          (d) a  statement  as to  whether or not,  in the  opinion of each such
     person,  such  condition  or covenant  has been  complied  with;  PROVIDED,
     HOWEVER,  that,  with respect to matters of fact, an Opinion of Counsel may
     rely on an Officers' Certificate or certificates of public officials.

          SECTION  11.05.  RULES BY  TRUSTEE,  PAYING  AGENT OR  REGISTRAR.  The
Trustee may make reasonable rules for action by or at a meeting of Holders.  The
Paying Agent or Registrar may make reasonable rules for its functions.

          SECTION 11.06.  PAYMENT DATE OTHER THAN A BUSINESS DAY. If an Interest
Payment  Date,  Payment  Date,  Stated  Maturity or date of maturity of any Note
shall not be a Business Day, then payment of principal of,  premium,  if any, or
interest on such Note,  as the case may be,  need not be made on such date,  but
may be made on the next  succeeding  Business Day with the same force and effect
as if made on the  Interest  Payment  Date or  Payment  Date,  or at the  Stated
Maturity  or date of  maturity of such Note;  PROVIDED  that no  interest  shall
accrue for the period from and after such Interest  Payment Date,  Payment Date,
Stated Maturity or date of maturity, as the case may be.

                                       70
<PAGE>

          SECTION 11.07.  GOVERNING LAW;  SUBMISSION TO JURISDICTION;  AGENT FOR
SERVICE. This Indenture and the Notes shall be governed by the laws of the State
of New York. The Company hereby appoints CT Corporation  System as its agent for
service  of  process  in any suit,  action or  proceeding  with  respect to this
Indenture or the Notes and for actions  brought under the U.S.  federal or state
securities laws brought in any federal or state court located in the City of New
York and the Company agrees to submit to the jurisdiction of any such court.

          SECTION 11.08. NO ADVERSE  INTERPRETATION  OF OTHER  AGREEMENTS.  This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any  Subsidiary of the Company.  Any such  indenture,  loan or
debt agreement may not be used to interpret this Indenture.

          SECTION 11.09. NO RECOURSE AGAINST OTHERS. No recourse for the payment
of the principal of,  premium,  if any, or interest on any of the Notes,  or for
any claim based thereon or otherwise in respect  thereof,  and no recourse under
or upon any obligation,  covenant or agreement of the Company  contained in this
Indenture,  or in  any  of  the  Notes,  or  because  of  the  creation  of  any
Indebtedness  represented  thereby,  shall be had  against any  incorporator  or
against any past, present or future partner,  stockholder,  other equity holder,
officer, director, employee or controlling person, as such, of the Company or of
any successor  Person,  either  directly or through the Company or any successor
Person, whether by virtue of any constitution, statute or rule of law, or by the
enforcement  of any  assessment  or penalty  or  otherwise;  it being  expressly
understood that all such liability is hereby  expressly waived and released as a
condition of, and as a  consideration  for, the execution of this  Indenture and
the issue of the Notes.

          SECTION  11.10.  SUCCESSORS.  All  agreements  of the  Company in this
Indenture and the Notes shall bind its successors. All agreements of the Trustee
in this Indenture shall bind its successors.

          SECTION 11.11. DUPLICATE ORIGINALS. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

          SECTION 11.12.  SEPARABILITY.  In case any provision in this Indenture
or in the Notes  shall be  invalid,  illegal  or  unenforceable,  the  validity,
legality and enforceability of the remaining  provisions shall not in any way be
affected or impaired thereby.

                                       71
<PAGE>

          SECTION  11.13.  TABLE  OF  CONTENTS,  HEADINGS,  ETC.  The  Table  of
Contents,  Cross-Reference  Table and  headings of the  Articles and Sections of
this Indenture have been inserted for  convenience of reference only, are not to
be  considered  a part hereof and shall in no way modify or restrict  any of the
terms and provisions hereof.

          SECTION  11.14.  METHOD OF PAYMENT.  (a) Euro is the sole  currency of
account and payment for all sums payable by the Company  under or in  connection
with the Notes, including damages, except as otherwise set forth in this Section
11.14.

          (b) Investors who hold beneficial  interests in the Notes,  directly
or  indirectly,  through DTC ("DTC  NOTEHOLDERS")  will be paid in U.S.  dollars
converted  from such payments in Euro by the Paying Agent unless the  registered
holder, on behalf of any such owner of beneficial  interests,  elects to receive
payments in Euro.

          Upon receipt of notice of such election and wire transfer instructions
on or prior to the fourth New York Business Day (as defined in clause (c) below)
after the record date for any  payment of interest  and on or prior to the sixth
New York Business Day prior to the payment of  principal,  the Paying Agent will
make such payments in Euro to the Euro accounts of the relevant Holders.

          The Paying Agent shall convert the  remainder of the aggregate  amount
of such payments into U.S.  dollars,  based on the Paying Agent's bid quotation,
at or prior to 11:00 a.m.,  New York Time,  on the second New York  Business Day
preceding the date of such payment,  for the purchase of U.S. dollars with Euro,
for  settlement  on the  date of such  payment.  If such  bid  quotation  is not
available,  all such payments will be made in Euro, outside DTC to Euro accounts
maintained by such DTC Noteholders.

          (c) All  costs  of  conversion,  if any,  will be  borne by such DTC
Noteholders,  by  deduction  from such  payments.  All costs of  payment by wire
transfer referred to in paragraph (b) above will be borne by registered  holders
receiving  such payments by deduction  from such  payments.  For purposes of the
foregoing,  "NEW YORK BUSINESS DAY" means a day all banking institutions are not
authorized  or obligated  by law or executive  order to be closed in the City of
New York.

          SECTION 11.15. JUDGMENT CURRENCY. Subject to Section 7.07, the Company
hereby agrees to indemnify the Trustee and any  predecessor  trustee  (acting on
behalf of the Holders or otherwise)  against any loss incurred by such person as
a result of any  judgment or order  being made or given  against the Company for
any Euro  amount due under this  Indenture.  The  Company  hereby also agrees to
indemnify such Trustee and any predecessor  trustee against any loss incurred by
such person if such judgment or order is being  expressed and paid in a currency
other  than Euro (the  "JUDGMENT  CURRENCY"),  as a result of any  variation  as
between (i) the rate of exchange at

                                       72
<PAGE>

which the Euro amount is converted into the Judgment Currency for the purpose of
such  judgment  or order and (ii) the spot rate of  exchange  in the City of New
York on which such party on the date of  payment  of such  judgment  or order is
able to purchase Euro with the amount of the Judgment Currency actually received
by such party.  The foregoing  indemnity shall continue in full force and effect
notwithstanding  any such  judgment or order.  The term "spot rate of  exchange"
shall include any premiums or costs of exchange  payable in connection  with the
purchase of, or conversion into the Euro.

            [THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

                                       73
<PAGE>

                                   SIGNATURES

          IN WITNESS  WHEREOF,  the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.

                                            VIATEL, INC.

                                            By: /s/ Michael Mahoney
                                               ---------------------------------
                                               Name:  Michael Mahoney
                                               Title: Chief Executive Officer

                                            THE BANK OF NEW YORK,
                                                as Trustee

                                            By: /s/ Ming J. Shiang
                                               ---------------------------------
                                               Name:  Ming J. Shiang
                                               Title: Vice President

                                       74
<PAGE>

                                                                       EXHIBIT A
                                                  FORM OF REGISTERED GLOBAL NOTE

                                 [FACE OF NOTE]

THIS NOTE HAS NOT BEEN  REGISTERED  UNDER THE U.S.  SECURITIES  ACT OF 1933,  AS
AMENDED (THE  "SECURITIES  ACT"), OR ANY STATE SECURITIES LAWS, AND ACCORDINGLY,
MAY NOT BE OFFERED,  SOLD,  PLEDGED OR OTHERWISE  TRANSFERRED  WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED  INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN
AN OFFSHORE  TRANSACTION  IN COMPLIANCE  WITH RULE 903 OF REGULATION S UNDER THE
SECURITIES  ACT; (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO
IN RULE 144(k) AS IN EFFECT ON THE DATE OF SUCH  TRANSFER,  RESELL OR  OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO VIATEL, INC. OR ANY SUBSIDIARY THEREOF,  (B) TO
A  QUALIFIED  INSTITUTIONAL  BUYER  IN  COMPLIANCE  WITH  RULE  144A  UNDER  THE
SECURITIES ACT, (C) TO AN INSTITUTIONAL  ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER,   FURNISHES  TO  THE  TRUSTEE  A  SIGNED  LETTER  CONTAINING   CERTAIN
REPRESENTATIONS  AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH  LETTER CAN BE OBTAINED  FROM THE  TRUSTEE)  AND IF SUCH
TRANSFER IS IN RESPECT OF AN  AGGREGATE  PRINCIPAL  AMOUNT OF NOTES OF LESS THAN
EURO  100,000,  AN OPINION  OF COUNSEL  ACCEPTABLE  TO  VIATEL,  INC.  THAT SUCH
TRANSFER IS IN COMPLIANCE  WITH THE SECURITIES  ACT, (D) TO A PERSON OUTSIDE THE
UNITED STATES IN AN OFFSHORE  TRANSACTION IN COMPLIANCE  WITH REGULATION S UNDER
THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION  PROVIDED BY
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT AND (3) AGREES  THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS NOTE IS  TRANSFERRED A NOTICE  SUBSTANTIALLY
TO THE EFFECT OF THIS  LEGEND.  IN  CONNECTION  WITH ANY  TRANSFER  OF THIS NOTE
WITHIN THE TIME PERIOD REFERRED TO ABOVE,  THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF  RELATING TO THE MANNER OF SUCH TRANSFER AND
SUBMIT  THIS  CERTIFICATE  TO THE  TRUSTEE.  IF THE  PROPOSED  TRANSFEREE  IS AN
INSTITUTIONAL  ACCREDITED  INVESTOR,  THE HOLDER MUST,  PRIOR TO SUCH  TRANSFER,
FURNISH TO EACH OF THE TRUSTEE  AND  VIATEL,  INC.  SUCH  CERTIFICATIONS,  LEGAL
OPINIONS OR OTHER INFORMATION AS SUCH PERSONS MAY REASONABLY  REQUIRE TO CONFIRM
THAT  SUCH  TRANSFER  IS BEING  MADE  PURSUANT  TO AN  EXEMPTION  FROM,  OR IN A
TRANSACTION NOT SUBJECT TO,

                                       A-1
<PAGE>

THE REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN,  THE TERMS
"OFFSHORE  TRANSACTION",  "UNITED  STATES" AND "U.S.  PERSON"  HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION  REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE
IN VIOLATION OF THE FOREGOING RESTRICTIONS.

[UNLESS  THIS GLOBAL NOTE IS PRESENTED BY AN  AUTHORIZED  REPRESENTATIVE  OF THE
DEPOSITORY  TRUST  COMPANY  TO VIATEL,  INC.  OR ITS AGENT FOR  REGISTRATION  OF
TRANSFER,  EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR
TO SUCH OTHER  ENTITY AS IS  REQUESTED BY AN  AUTHORIZED  REPRESENTATIVE  OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY OR TO ANY PERSON IS  WRONGFUL  INASMUCH  AS THE  REGISTERED  OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART,  TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR  THEREOF OR SUCH  SUCCESSOR'S
NOMINEE  AND  TRANSFERS  OF  PORTIONS  OF THIS  GLOBAL  NOTE SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE  RESTRICTIONS SET FORTH IN SECTION 2.08 OF
THE INDENTURE.]*

[THIS NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE GOVERNING THIS
NOTE) IN CUSTODY FOR THE BENEFIT OF THE  BENEFICIAL  OWNERS  HEREOF,  AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY  CIRCUMSTANCES  EXCEPT THAT (1) THE TRUSTEE
MAY MAKE SUCH  NOTATIONS  HEREON AS MAY BE REQUIRED  PURSUANT TO SECTION 2.08 OF
THE  INDENTURE,  (2) THIS GLOBAL NOTE MAY BE  EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED
TO THE TRUSTEE FOR  CANCELLATION  PURSUANT TO SECTION 2.12 OF THE  INDENTURE AND
(4) THIS GLOBAL NOTE MAY BE DELIVERED TO A SUCCESSOR  DEPOSITORY  WITH THE PRIOR
WRITTEN CONSENT OF VIATEL, INC.]**

-------------
*   Bracketed  language  to be added if  Restricted  Global  is a DTC Rule  144A
    Global.

**  Bracked language to be added if Restricted Global is a European 144A Global.

                                       A-2
<PAGE>

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note Due 2008

                                              [CUSIP][ISIN]*[COMMON CODE]* [___]
No. __________                                                     Euro[_______]

     Issue date: April 20, 2000

     VIATEL,  INC., a Delaware  corporation (the "Company",  which term includes
any successor under the Indenture  hereinafter referred to), for value received,
promises to pay to ________________,  or its registered assigns,  upon surrender
hereof the principal sum of Euro _________ on April 15, 2008.

     Interest  Payment Dates:  April 15 and October 15,  commencing  October 15,
2000.

     Record Dates: April 1 and October 1.

     Reference is hereby made to the further  provisions  of this Note set forth
on the reverse hereof,  which further provisions shall for all purposes have the
same effect as if set forth at this place.

-------------
*   To be inserted for European 144A Global.

                                       A-3
<PAGE>

     IN WITNESS WHEREOF,  the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.

Date: April 20, 2000                        VIATEL, INC.

                                            By:
                                               ---------------------------------
                                               Name:
                                               Title:

                                            By:
                                               ---------------------------------
                                               Name:
                                               Title:

                  (Trustee's Certificate of Authentication)

This  is  one of the 12  3/4%  Senior  Euro  Notes  due  2008  described  in the
within-mentioned Indenture.

Date:  April 20, 2000                       THE BANK OF NEW YORK, as Trustee

                                            By
                                              ----------------------------------
                                              Authorized Signatory

                                       A-4
<PAGE>

                             [REVERSE SIDE OF NOTE]

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note due 2008

1.    PRINCIPAL AND INTEREST.

          The Company will pay the principal of this Note on April 15, 2008.

          The Company  promises to pay interest on the principal  amount of this
Note on each Interest  Payment  Date, as set forth below,  at the rate per annum
shown above.

          Interest  will be  payable  semiannually  in cash (to the  holders  of
record  of the  Notes at the  close of  business  on the  April 1 or  October  1
immediately  preceding the Interest Payment Date) on each Interest Payment Date,
commencing October 15, 2000. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.

          If an  exchange  offer  registered  under  the  Securities  Act is not
consummated,  and a shelf  registration  statement under the Securities Act with
respect to resales of the Notes is not declared effective by the Commission,  on
or before the date that is 180 days after the Closing  Date in  accordance  with
the terms of the Registration  Rights Agreement,  dated April 14, 2000,  between
the Company and Morgan Stanley & Co.  International  Limited, as the manager for
itself and the several  placement  agents  named on Schedule I to the  Placement
Agreement,  dated  April 14,  2000,  annual  interest  (in  addition to interest
otherwise  due on the Notes) will accrue,  at an annual rate of .5% per annum of
the principal amount,  payable in cash semiannually,  in arrears on April 15 and
October 15 of each year, commencing October 15, 2000 until the consummation of a
registered exchange offer or the effectiveness of a shelf-registration statement
with respect to resale of this Note.  The Holder of this Note is entitled to the
benefits of such Registration Rights Agreement.

          The Company shall pay interest on overdue  principal  and premium,  if
any, and interest on overdue installments of interest,  to the extent lawful, at
a rate per annum that is 12 3/4% per annum.

2.    METHOD OF PAYMENT.

          The Company will pay principal as provided above and interest  (except
defaulted  interest) on the principal  amount of the Notes as provided  above on
each April 15 and October 15 to the Persons who are Holders (as reflected in the
Note  Register  at the  close  of  business  on  such  April  1 and  October  1,
immediately preceding the Interest Payment Date), in each case, even if the Note
is cancelled on  registration of transfer or registration of exchange after such
record  date;  PROVIDED  that,  with  respect to the payment of  principal,  the
Company will not make payment to the Holder unless this Note is surrendered to a
Paying Agent.

                                       A-5
<PAGE>

          The  Company  will pay  principal,  premium,  if any,  and as provided
above,  interest in Euros.  However, the Company may pay principal,  premium, if
any, and interest by its check payable in such currency. It may mail an interest
check to a Holder's registered address (as reflected in the Note Register). If a
payment date is a date other than a Business Day at a place of payment,  payment
may be made at that place on the next  succeeding day that is a Business Day and
no interest shall accrue for the intervening period.

3.    PAYING AGENT AND REGISTRAR.

          Initially,  the Trustee will act as Paying Agent and Registrar and the
Trustee  (through its London Branch) will act as Euro Paying Agent.  The Company
will  maintain a paying  agent in Frankfurt in the event the Notes are listed on
the Frankfurt  over-the-counter  market. The Company may change any Paying Agent
or Registrar without notice. The Company, any Subsidiary or any Affiliate of any
of them may act as Paying Agent, Registrar or co-Registrar.

4.    INDENTURE; ISSUANCE OF ADDITIONAL NOTES.

          This Note is one of a duly  authorized  issue of Notes of the  Company
designated  its 12 3/4% Senior Notes due 2008,  issued and to be issued under an
Indenture, dated as of April 20, 2000 (the "Indenture"), between the Company and
the Trustee.  Capitalized terms used herein are used as defined in the Indenture
unless otherwise  indicated.  The terms of the Notes include those stated in the
Indenture  and  those  made  part of the  Indenture  by  reference  to the Trust
Indenture Act. The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Trust  Indenture Act for a statement of all such terms.
To the extent  permitted by  applicable  law, in the event of any  inconsistency
between the terms of this Note and the terms of the Indenture,  the terms of the
Indenture shall control.

5.    REPURCHASE UPON CHANGE IN CONTROL.

          Upon the  occurrence of any Change of Control,  each Holder shall have
the right to require the repurchase of its Notes by the Company in cash pursuant
to the offer described in the Indenture at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid  interest,  if any, to the date
of purchase (the "Change of Control Payment").

          A notice of such Change of Control will be mailed within 30 days after
any Change of Control occurs to each Holder at his last address as it appears in
the Note  Register.  Notes in original  denominations  larger than Euro 1,000 of
principal  amount may be sold to the  Company in part.  On and after the date of
the Change of Control Payment, interest ceases to accrue on Notes or portions of
Notes  surrendered for purchase by the Company,  unless the Company  defaults in
the payment of the Change of Control Payment.

6.    REGISTRATION RIGHTS

          Pursuant to the  Registration  Rights  Agreement,  the Company will be
obligated,  within 180 days  after the issue date of this Note,  to use its best
efforts to  consummate  an exchange  offer  pursuant to which the Holder of this

                                       A-6
<PAGE>

Note shall have the right to exchange this Note for the Company's Exchange Notes
(as defined in the  Registration  Rights  Agreement)  which have been registered
under the Securities Act, in like principal amount and having terms identical in
all material  respects to the initial  Notes.  The Holders of the initial  Notes
shall be entitled to receive certain  additional  interest payments in the event
such exchange offer is not  consummated and upon certain other  conditions,  all
pursuant and in accordance with the terms of the Registration Rights Agreement.

7.    DENOMINATIONS; TRANSFER; EXCHANGE.

          The Notes are in registered form without coupons in  denominations  of
Euro 1,000 of  principal  amount  and any  integral  multiples  of Euro 1,000 in
excess  thereof.  A Holder may  register  the  transfer  or exchange of Notes in
accordance with the Indenture.  The Registrar may require a Holder,  among other
things, to furnish  appropriate  endorsements and transfer  documents and to pay
any taxes and fees required by law or permitted by the Indenture.

8.    PERSONS DEEMED OWNERS.

          A Holder shall be treated as the owner of a Note for all purposes.

9.    UNCLAIMED MONEY.

          If money for the payment of  principal,  premium,  if any, or interest
remains  unclaimed for two years,  the Trustee and the Paying Agent will pay the
money back to the Company at its request.  After that,  Holders  entitled to the
money must look to the Company for  payment,  unless an  abandoned  property law
designates  another  Person,  and all  liability  of the Trustee and such Paying
Agent with respect to such money shall cease.

10.   DISCHARGE PRIOR TO REDEMPTION OR MATURITY.

          If the  Company  deposits  with  the  Trustee  money  and/or  European
Government  Obligations  sufficient  to pay the then  outstanding  principal of,
premium,  if any,  and  accrued  interest  on the  Notes  (a) to  redemption  or
maturity,  the Company  will be  discharged  from the  Indenture  and the Notes,
except in certain  circumstances for certain sections thereof, and (b) to Stated
Maturity, the Company will be discharged from certain covenants set forth in the
Indenture.

11.   AMENDMENT; SUPPLEMENT; WAIVER.

          Subject  to  certain  exceptions,  the  Indenture  or the Notes may be
amended or  supplemented  with the consent of the Holders of at least a majority
in principal amount of the Notes then  outstanding,  and any existing default or
compliance  with any  provision may be waived with the consent of the Holders of
at least a majority in principal amount of the Notes then  outstanding.  Without
notice  to or the  consent  of any  Holder,  the  parties  thereto  may amend or
supplement  the  Indenture  or the  Notes  to,  among  other  things,  cure  any
ambiguity,  defect or inconsistency and make any change that does not materially
and adversely affect the rights of any Holder.

                                       A-7
<PAGE>

12.   RESTRICTIVE COVENANTS.

          The  Indenture  imposes  certain  limitations  on the  ability  of the
Company  and  its  Restricted   Subsidiaries,   among  other  things,  to  Incur
Indebtedness,  make  Restricted  Payments,  use the  proceeds  from Asset Sales,
engage in transactions  with Affiliates or, with respect to the Company,  merge,
consolidate or transfer  substantially  all of its assets.  Within 90 days after
the end of the last fiscal  quarter of each year, the Company must report to the
Trustee on compliance with the terms of the Indenture.

13.   SUCCESSOR PERSONS.

          When a successor Person or other entity assumes all the obligations of
its predecessor under the Notes and the Indenture,  the predecessor  Person will
be released from those obligations.

14.   DEFAULTS AND REMEDIES.

          The  following  events  constitute   "Events  of  Default"  under  the
Indenture:  (a) default in the payment of principal of (or premium,  if any, on)
any Note when the same becomes due and payable at maturity,  upon  acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note when
the same becomes due and payable,  and such default continues for a period of 30
days;  PROVIDED that a failure to make any of the first three scheduled interest
payments  on this Note in a timely  manner will  constitute  an Event of Default
with no grace or cure period;  (c) default in the  performance  or breach of the
provisions of the Indenture applicable to mergers,  consolidations and transfers
of all or substantially  all of the assets of the Company or the failure to make
or  consummate  an Offer to  Purchase in  accordance  with  Section  4.11 of the
Indenture  or Section  4.12 of the  Indenture;  (d) the Company  defaults in the
performance of or breaches any other covenant or agreement of the Company in the
Indenture or under the Notes (other than a default  specified in clause (a), (b)
or (c) of Section 6.01 of the  Indenture)  and such default or breach  continues
for a period of 30  consecutive  days after written notice by the Trustee or the
Holders of 25% or more in  aggregate  principal  amount or  principal  amount of
Notes;  (e) there occurs with respect to any issue or issues of  Indebtedness of
the Company or any Significant Subsidiary having an outstanding principal amount
of $10 million or more in the aggregate for all such issues of all such Persons,
whether such Indebtedness now exists or shall hereafter be created, (I) an event
of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such  Indebtedness has not been
discharged  in full or such  acceleration  has not been  rescinded  or  annulled
within 30 days of such acceleration  and/or (II) the failure to make a principal
payment at the final (but not any interim)  fixed  maturity  and such  defaulted
payment  shall not have been  made,  waived or  extended  within 30 days of such
payment default;  (f) any final judgment or order (not covered by insurance) for
the  payment  of money in excess of $10  million in the  aggregate  for all such
final  judgments or orders against all such Persons  (treating any  deductibles,
self-insurance  or  retention as not so covered)  shall be rendered  against the
Company or any Significant  Subsidiary and shall not be paid or discharged,  and
there shall be any period of 60 consecutive  days  following  entry of the final
judgment or order that causes the aggregate  amount for all such final judgments
or orders  outstanding  and not paid or  discharged  against all such Persons to

                                       A-8
<PAGE>

exceed $10 million  during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; (g) a
court  having  jurisdiction  in the  premises  enters a decree  or order for (A)
relief in respect of the Company or any Significant Subsidiary in an involuntary
case under any  applicable  bankruptcy,  insolvency  or other similar law now or
hereafter  in effect,  (B)  appointment  of a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the  Company or any  Significant  Subsidiary  or (C) the winding up or
liquidation of the affairs of the Company or any Significant  Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60  consecutive  days; or (h) the Company or any  Significant  Subsidiary (A)
commences a voluntary case under any applicable bankruptcy,  insolvency or other
similar law now or hereafter in effect, or consents to the entry of an order for
relief  in an  involuntary  case  under  any  such  law,  (B)  consents  to  the
appointment  of  or  taking  possession  by a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the Company or any  Significant  Subsidiary or (C) effects any general
assignment for the benefit of creditors.

          If an Event of Default  (other than an Event of Default  specified  in
clause (g) or (h) above that occurs with respect to the  Company)  occurs and is
continuing  under the  Indenture,  the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes, then outstanding,  by written notice to
the Company (and to the Trustee if such notice is given by the Holders) may, and
the Trustee at the request of such Holders shall,  declare the principal  amount
of, premium, if any, and accrued interest on the Notes to be immediately due and
payable.

          If a  bankruptcy  or  insolvency  default  with respect to the Company
occurs  and is  continuing,  the Notes  automatically  become  due and  payable.
Holders  may not enforce the  Indenture  or the Notes  except as provided in the
Indenture.  The  Trustee  may  require  indemnity  satisfactory  to it before it
enforces the Indenture or the Notes. Subject to certain limitations,  Holders of
at least a majority in principal amount of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.

15.   TRUSTEE DEALINGS WITH COMPANY.

          The  Trustee  under  the  Indenture,  in its  individual  or any other
capacity,  may make loans to, accept deposits from and perform  services for the
Company  or its  Affiliates  and may  otherwise  deal  with the  Company  or its
Affiliates as if it were not the Trustee.

16.   NO RECOURSE AGAINST OTHERS.

          No incorporator or any past,  present or future partner,  stockholder,
other equity holder, officer, director,  employee or controlling person as such,
of the  Company or of any  successor  Person  shall have any  liability  for any
obligations  of the Company  under the Notes or the  Indenture  or for any claim
based on, in respect of or by reason of,  such  obligations  or their  creation.
Each Holder by  accepting a Note waives and  releases  all such  liability.  The
waiver and release are part of the consideration for the issuance of the Notes.

17.   AUTHENTICATION.

                                       A-9
<PAGE>

          This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.

18.   ABBREVIATIONS.

          Customary  abbreviations  may be used in the  name of a  Holder  or an
assignee,  such as:  TEN COM (= tenants  in  common),  TEN ENT (= tenants by the
entireties),  JT TEN (= joint  tenants  with  right of  survivorship  and not as
tenants in common),  CUST (=  Custodian)  and U/G/M/A (= Uniform Gifts to Minors
Act).

       THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

          The  Company  will  furnish to any Holder  upon  written  request  and
without  charge a copy of the Indenture.  Requests may be made to Viatel,  Inc.,
685 Third Avenue, New York, New York, 10017, Attention: General Counsel.

                                       A-10
<PAGE>

                 SCHEDULE OF PRINCIPAL AMOUNT OF INDEBTEDNESS
                             EVIDENCED BY THIS NOTE

          The initial  principal  amount of indebtedness  evidenced by this Note
shall be Euro [__]. The following  decreases/increases  in the principal  amount
evidenced by this Note have been made:

             Decrease    Increase
             in          in
             Principal   Principal   Total Principal
             Amount of   Amount of   Amount of this       Notation Made
Date of      this        this        Global Note          by or on
Decrease/    Global      Global      Following such       Behalf of
Increase     Note        Note        Decrease/Increase    Trustee
--------     ---------   ---------   -----------------    --------------

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

                                       A-11
<PAGE>

                            [FORM OF TRANSFER NOTICE]

          FOR VALUE RECEIVED the undersigned  registered  holder hereby sell(s),
assign(s) and transfer(s) unto

INSERT TAXPAYER IDENTIFICATION NO.

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

Please print or typewrite name and address including zip code of assignee

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

the within Note and all rights thereunder,  hereby irrevocably  constituting and
appointing ---------------------------------------------------------------------
attorney  to transfer  said Note on the books of the Company  with full power of
substitution in the premises.

                   [THE FOLLOWING PROVISION TO BE INCLUDED
                   ON ALL NOTES OTHER THAN EXCHANGE NOTES,
                       UNLEGENDED REGULATION S GLOBAL AND
                   UNLEGENDED REGULATION S CERTIFICATED NOTES]

          In connection  with any transfer of this Note  occurring  prior to the
date which is the earlier of (i) the date of an effective  Registration  or (ii)
the end of the period  referred to in Rule 144(k) under the Securities  Act, the
undersigned  confirms that without utilizing any general solicitation or general
advertising that:

                                   [CHECK ONE]

[    ] (a)    this Note is being  transferred  in compliance  with the exemption
              from  registration  under the  Securities Act of 1933, as amended,
              provided by Rule 144A thereunder.

                                       OR

[    ] (b)    this Note is being  transferred  other than in accordance with (a)
              above and  documents  are being  furnished  which  comply with the
              conditions of transfer set forth in this Note and the Indenture.

If none of the foregoing boxes is checked,  the Trustee or other Registrar shall
not be obligated to register  this Note in the name of any Person other than the
Holder  hereof  unless  and  until  the  conditions  to  any  such  transfer  of
registration  set forth herein and in Section 2.08 of the  Indenture  shall have
been satisfied.

                                       A-12
<PAGE>

Date:
     ----------------------                        -----------------------------

                              NOTICE:  The  signature  to this  assignment  must
                              correspond  with the name as written upon the face
                              of  the   within-mentioned   instrument  in  every
                              particular,   without  alteration  or  any  change
                              whatsoever.

TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

          The  undersigned  represents  and warrants that it is purchasing  this
Note for its own account or an account with  respect to which it exercises  sole
investment  discretion  and  that  it  and  any  such  account  is a  "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended,  and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges  that it has received such information  regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request  such  information  and that it is aware that the  transferor  is
relying upon the undersigned's  foregoing  representations in order to claim the
exemption from registration provided by Rule 144A.

Dated:
      ----------------------                        ----------------------------

                                      NOTICE:  To be  executed  by an  executive
                                      officer

                                       A-13
<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

            If you wish to have this Note  purchased  by the Company  pursuant
to Section 4.11 or Section 4.12 of the Indenture, check the Box:   |__|

            If you wish to have a portion of this Note  purchased by the Company
pursuant to Section 4.11 or Section 4.12 of the Indenture,  state the amount (in
principal amount):  Euro _____________.

Date:
     ----------------------

Your Signature:
               -----------------------
               (Sign  exactly  as your name  appears  on the other  side of this
               Note)

Signature Guarantee:  ______________________________

                                       A-14
<PAGE>

                                                                       EXHIBIT B

                        FORM OF REGULATION S GLOBAL NOTE

                                 [FACE OF NOTE]

THIS NOTE HAS NOT BEEN  REGISTERED  UNDER THE U.S.  SECURITIES  ACT OF 1933,  AS
AMENDED (THE  "SECURITIES  ACT"), OR ANY STATE SECURITIES LAWS, AND ACCORDINGLY,
MAY NOT BE OFFERED,  SOLD,  PLEDGED OR OTHERWISE  TRANSFERRED  WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED  INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN
AN OFFSHORE  TRANSACTION  IN COMPLIANCE  WITH RULE 903 OF REGULATION S UNDER THE
SECURITIES  ACT; (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO
IN RULE 144(k) AS IN EFFECT ON THE DATE OF SUCH  TRANSFER,  RESELL OR  OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO VIATEL, INC. OR ANY SUBSIDIARY THEREOF,  (B) TO
A  QUALIFIED  INSTITUTIONAL  BUYER  IN  COMPLIANCE  WITH  RULE  144A  UNDER  THE
SECURITIES ACT, (C) TO AN INSTITUTIONAL  ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER,   FURNISHES  TO  THE  TRUSTEE  A  SIGNED  LETTER  CONTAINING   CERTAIN
REPRESENTATIONS  AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH  LETTER CAN BE OBTAINED  FROM THE  TRUSTEE)  AND IF SUCH
TRANSFER IS IN RESPECT OF AN  AGGREGATE  PRINCIPAL  AMOUNT OF NOTES OF LESS THAN
EURO  100,000,  AN OPINION  OF COUNSEL  ACCEPTABLE  TO  VIATEL,  INC.  THAT SUCH
TRANSFER IS IN COMPLIANCE  WITH THE SECURITIES  ACT, (D) TO A PERSON OUTSIDE THE
UNITED STATES IN AN OFFSHORE  TRANSACTION IN COMPLIANCE  WITH REGULATION S UNDER
THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION  PROVIDED BY
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT AND (3) AGREES  THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS NOTE IS  TRANSFERRED A NOTICE  SUBSTANTIALLY
TO THE EFFECT OF THIS  LEGEND.  IN  CONNECTION  WITH ANY  TRANSFER  OF THIS NOTE
WITHIN THE TIME PERIOD REFERRED TO ABOVE,  THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF  RELATING TO THE MANNER OF SUCH TRANSFER AND
SUBMIT  THIS  CERTIFICATE  TO THE  TRUSTEE.  IF THE  PROPOSED  TRANSFEREE  IS AN
INSTITUTIONAL  ACCREDITED  INVESTOR,  THE HOLDER MUST,  PRIOR TO SUCH  TRANSFER,
FURNISH TO EACH OF THE TRUSTEE  AND  VIATEL,  INC.  SUCH  CERTIFICATIONS,  LEGAL
OPINIONS OR OTHER INFORMATION AS SUCH PERSONS MAY REASONABLY  REQUIRE TO CONFIRM
THAT  SUCH  TRANSFER  IS BEING  MADE  PURSUANT  TO AN  EXEMPTION  FROM,  OR IN A
TRANSACTION NOT SUBJECT TO,

                                      B-1
<PAGE>

THE REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN,  THE TERMS
"OFFSHORE  TRANSACTION",  "UNITED  STATES" AND "U.S.  PERSON"  HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION  REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE
IN VIOLATION OF THE FOREGOING RESTRICTIONS.

THIS NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE  GOVERNING THIS
NOTE) IN CUSTODY FOR THE BENEFIT OF THE  BENEFICIAL  OWNERS  HEREOF,  AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY  CIRCUMSTANCES  EXCEPT THAT (1) THE TRUSTEE
MAY MAKE SUCH  NOTATIONS  HEREON AS MAY BE REQUIRED  PURSUANT TO SECTION 2.08 OF
THE  INDENTURE,  (2) THIS GLOBAL NOTE MAY BE  EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED
TO THE TRUSTEE FOR  CANCELLATION  PURSUANT TO SECTION 2.12 OF THE  INDENTURE AND
(4) THIS GLOBAL NOTE MAY BE DELIVERED TO A SUCCESSOR  DEPOSITORY  WITH THE PRIOR
WRITTEN CONSENT OF VIATEL, INC.

                                      B-2
<PAGE>

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note Due 2008

                                    [CUSIP][CINS][ISIN][Common Code] _________
No.  __________                                                  Euro_________

          Issue date:  April 20, 2000

          VIATEL,  INC.,  a  Delaware  corporation  (the  "Company",  which term
includes any successor under the Indenture  hereinafter  referred to), for value
received,  promises  to pay to  ___________,  or its  registered  assigns,  upon
surrender hereof the principal sum of Euro _________ on April 15, 2008.

          Interest Payment Dates:  April 15 and October 15,  commencing  October
15, 2000.

          Record Dates: April 1 and October 1.

          Reference  is hereby made to the further  provisions  of this Note set
forth on the reverse  hereof,  which further  provisions  shall for all purposes
have the same effect as if set forth at this place.

                                      B-3
<PAGE>

          IN WITNESS  WHEREOF,  the  Company  has caused  this Note to be signed
manually or by facsimile by its duly authorized officers.

Date: April 20, 2000                    VIATEL, INC.

                                        By
                                          --------------------------------------
                                          Name:
                                          Title:

                                        By
                                          --------------------------------------
                                          Name:
                                          Title:

                  (Trustee's Certificate of Authentication)

This  is one  of  the  12-3/4  Senior  Euro  Notes  due  2008  described  in the
within-mentioned Indenture.

Date: April 20, 2000                      THE BANK OF NEW YORK, as Trustee

                                          By
                                            ------------------------------------
                                                Authorized Signatory

                                      B-4
<PAGE>

                             [REVERSE SIDE OF NOTE]

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note due 2008

1.    PRINCIPAL AND INTEREST.

          The Company will pay the principal of this Note on April 15, 2008.

          The Company  promises to pay interest on the principal  amount of this
Note on each Interest  Payment  Date, as set forth below,  at the rate per annum
shown above.

          Interest  will be  payable  semiannually  in cash (to the  holders  of
record  of the  Notes at the  close of  business  on the  April 1 or  October  1
immediately  preceding the Interest Payment Date) on each Interest Payment Date,
commencing October 15, 2000. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.

          If an  exchange  offer  registered  under  the  Securities  Act is not
consummated,  and a shelf  registration  statement under the Securities Act with
respect to resales of the Notes is not declared effective by the Commission,  on
or before the date that is 180 days after the Closing  Date in  accordance  with
the terms of the Registration  Rights Agreement,  dated April 14, 2000,  between
the Company and Morgan Stanley & Co.  International  Limited, as the manager for
itself and the several  placement  agents  named on Schedule I to the  Placement
Agreement,  dated  April 14,  2000,  annual  interest  (in  addition to interest
otherwise due on the Notes) will accrue,  at an annual rate of 0.5% per annum of
the principal amount,  payable in cash semiannually,  in arrears on April 15 and
October 15 of each year, commencing October 15, 2000 until the consummation of a
registered exchange offer or the effectiveness of a shelf-registration statement
with respect to resale of this Note.  The Holder of this Note is entitled to the
benefits of such Registration Rights Agreement.

          The Company shall pay interest on overdue  principal  and premium,  if
any, and interest on overdue installments of interest,  to the extent lawful, at
a rate per annum that is 12 3/4% per annum.

2.    METHOD OF PAYMENT.

          The Company will pay principal as provided above and interest  (except
defaulted  interest) on the principal  amount of the Notes as provided  above on
each April 15 and October 15 to the Persons who are Holders (as reflected in the
Note  Register  at the  close  of  business  on  such  April  1 and  October  1,
immediately preceding the Interest Payment Date), in each case, even if the Note
is cancelled on  registration of transfer or registration of exchange after such
record  date;  PROVIDED  that,  with  respect to the payment of  principal,  the
Company will not make payment to the Holder unless this Note is surrendered to a
Paying Agent.

                                      B-5
<PAGE>

          The  Company  will pay  principal,  premium,  if any,  and as provided
above,  interest in Euros.  However, the Company may pay principal,  premium, if
any, and interest by its check payable in such currency. It may mail an interest
check to a Holder's registered address (as reflected in the Note Register). If a
payment date is a date other than a Business Day at a place of payment,  payment
may be made at that place on the next  succeeding day that is a Business Day and
no interest shall accrue for the intervening period.

3.    PAYING AGENT AND REGISTRAR.

          Initially,  the Trustee will act as Paying Agent and Registrar and the
Trustee  (through its London Branch) will act as Euro Paying Agent.  The Company
will  maintain a paying  agent in Frankfurt in the event the Notes are listed on
the Frankfurt  over-the-counter  market. The Company may change any Paying Agent
or Registrar without notice. The Company, any Subsidiary or any Affiliate of any
of them may act as Paying Agent, Registrar or co-Registrar.

4.    INDENTURE; ISSUANCE OF ADDITIONAL NOTES.

          This Note is one of a duly  authorized  issue of Notes of the  Company
designated  its 12 3/4% Senior Notes due 2008,  issued and to be issued under an
Indenture, dated as of April 20, 2000 (the "Indenture"), between the Company and
the  Trustee.  Capitalized  terms  herein are used as  defined in the  Indenture
unless otherwise  indicated.  The terms of the Notes include those stated in the
Indenture  and  those  made  part of the  Indenture  by  reference  to the Trust
Indenture Act. The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Trust  Indenture Act for a statement of all such terms.
To the extent  permitted by  applicable  law, in the event of any  inconsistency
between the terms of this Note and the terms of the Indenture,  the terms of the
Indenture shall control.

5.    REPURCHASE UPON CHANGE IN CONTROL.

          Upon the  occurrence of any Change of Control,  each Holder shall have
the right to require the repurchase of its Notes by the Company in cash pursuant
to the offer described in the Indenture at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid  interest,  if any, to the date
of purchase (the "Change of Control Payment").

          A notice of such Change of Control will be mailed within 30 days after
any Change of Control occurs to each Holder at his last address as it appears in
the Note  Register.  Notes in original  denominations  larger than Euro 1,000 of
principal  amount may be sold to the  Company in part.  On and after the date of
the Change of Control Payment, interest ceases to accrue on Notes or portions of
Notes  surrendered for purchase by the Company,  unless the Company  defaults in
the payment of the Change of Control Payment.

6.    REGISTRATION RIGHTS

          Pursuant to the  Registration  Rights  Agreement,  the Company will be
obligated,  within 180 days  after the issue date of this Note,  to use its best
efforts to  consummate  an exchange  offer  pursuant to which the Holder of this
Note shall have the right to exchange this Note for the Company's Exchange Notes

                                      B-6
<PAGE>

(as defined in the  Registration  Rights  Agreement)  which have been registered
under the Securities Act, in like principal amount and having terms identical in
all material  respects to the initial  Notes.  The Holders of the initial  Notes
shall be entitled to receive certain  additional  interest payments in the event
such exchange offer is not  consummated and upon certain other  conditions,  all
pursuant and in accordance with the terms of the Registration Rights Agreement.

7.    DENOMINATIONS; TRANSFER; EXCHANGE.

          The Notes are in registered form without coupons in  denominations  of
Euro 1,000 of  principal  amount  and any  integral  multiples  of Euro 1,000 in
excess  thereof.  A Holder may  register  the  transfer  or exchange of Notes in
accordance with the Indenture.  The Registrar may require a Holder,  among other
things, to furnish  appropriate  endorsements and transfer  documents and to pay
any taxes and fees required by law or permitted by the Indenture.

8.    PERSONS DEEMED OWNERS.

          A Holder shall be treated as the owner of a Note for all purposes.

9.    UNCLAIMED MONEY.

          If money for the payment of  principal,  premium,  if any, or interest
remains  unclaimed for two years,  the Trustee and the Paying Agent will pay the
money back to the Company at its request.  After that,  Holders  entitled to the
money must look to the Company for  payment,  unless an  abandoned  property law
designates  another  Person,  and all  liability  of the Trustee and such Paying
Agent with respect to such money shall cease.

10.   DISCHARGE PRIOR TO REDEMPTION OR MATURITY.

          If the  Company  deposits  with  the  Trustee  money  and/or  European
Government  Obligations  sufficient  to pay the then  outstanding  principal of,
premium,  if any,  and  accrued  interest  on the  Notes  (a) to  redemption  or
maturity,  the Company  will be  discharged  from the  Indenture  and the Notes,
except in certain  circumstances for certain sections thereof, and (b) to Stated
Maturity, the Company will be discharged from certain covenants set forth in the
Indenture.

11.   AMENDMENT; SUPPLEMENT; WAIVER.

          Subject  to  certain  exceptions,  the  Indenture  or the Notes may be
amended or  supplemented  with the consent of the Holders of at least a majority
in principal amount of the Notes then  outstanding,  and any existing default or
compliance  with any  provision may be waived with the consent of the Holders of
at least a majority in principal amount of the Notes then  outstanding.  Without
notice  to or the  consent  of any  Holder,  the  parties  thereto  may amend or
supplement  the  Indenture  or the  Notes  to,  among  other  things,  cure  any
ambiguity,  defect or inconsistency and make any change that does not materially
and adversely affect the rights of any Holder.

                                      B-7
<PAGE>

12.   RESTRICTIVE COVENANTS.

          The  Indenture  imposes  certain  limitations  on the  ability  of the
Company  and  its  Restricted   Subsidiaries,   among  other  things,  to  Incur
Indebtedness,  make  Restricted  Payments,  use the  proceeds  from Asset Sales,
engage in transactions  with Affiliates or, with respect to the Company,  merge,
consolidate or transfer  substantially  all of its assets.  Within 90 days after
the end of the last fiscal  quarter of each year, the Company must report to the
Trustee on compliance with the terms of the Indenture.

13.   SUCCESSOR PERSONS.

          When a successor Person or other entity assumes all the obligations of
its predecessor under the Notes and the Indenture,  the predecessor  Person will
be released from those obligations.

14.   DEFAULTS AND REMEDIES.

          The  following  events  constitute   "Events  of  Default"  under  the
Indenture:  (a) default in the payment of principal of (or premium,  if any, on)
any Note when the same becomes due and payable at maturity,  upon  acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note when
the same becomes due and payable,  and such default continues for a period of 30
days;  PROVIDED that a failure to make any of the first three scheduled interest
payments  on this Note in a timely  manner will  constitute  an Event of Default
with no grace or cure period;  (c) default in the  performance  or breach of the
provisions of the Indenture applicable to mergers,  consolidations and transfers
of all or substantially  all of the assets of the Company or the failure to make
or  consummate  an Offer to  Purchase in  accordance  with  Section  4.11 of the
Indenture  or Section  4.12 of the  Indenture;  (d) the Company  defaults in the
performance of or breaches any other covenant or agreement of the Company in the
Indenture or under the Notes (other than a default  specified in clause (a), (b)
or (c) of Section 6.01 of the  Indenture)  and such default or breach  continues
for a period of 30  consecutive  days after written notice by the Trustee or the
Holders of 25% or more in  aggregate  principal  amount or  principal  amount of
Notes;  (e) there occurs with respect to any issue or issues of  Indebtedness of
the Company or any Significant Subsidiary having an outstanding principal amount
of $10 million or more in the aggregate for all such issues of all such Persons,
whether such Indebtedness now exists or shall hereafter be created, (I) an event
of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such  Indebtedness has not been
discharged  in full or such  acceleration  has not been  rescinded  or  annulled
within 30 days of such acceleration  and/or (II) the failure to make a principal
payment at the final (but not any interim)  fixed  maturity  and such  defaulted
payment  shall not have been  made,  waived or  extended  within 30 days of such
payment default;  (f) any final judgment or order (not covered by insurance) for
the  payment  of money in excess of $10  million in the  aggregate  for all such
final  judgments or orders against all such Persons  (treating any  deductibles,
self-insurance  or  retention as not so covered)  shall be rendered  against the
Company or any Significant  Subsidiary and shall not be paid or discharged,  and
there shall be any period of 60 consecutive  days  following  entry of the final
judgment or order that causes the aggregate  amount for all such final judgments
or orders  outstanding  and not paid or  discharged  against all such Persons to

                                      B-8
<PAGE>

exceed $10 million  during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; (g) a
court  having  jurisdiction  in the  premises  enters a decree  or order for (A)
relief in respect of the Company or any Significant Subsidiary in an involuntary
case under any  applicable  bankruptcy,  insolvency  or other similar law now or
hereafter  in effect,  (B)  appointment  of a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the  Company or any  Significant  Subsidiary  or (C) the winding up or
liquidation of the affairs of the Company or any Significant  Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60  consecutive  days; or (h) the Company or any  Significant  Subsidiary (A)
commences a voluntary case under any applicable bankruptcy,  insolvency or other
similar law now or hereafter in effect, or consents to the entry of an order for
relief  in an  involuntary  case  under  any  such  law,  (B)  consents  to  the
appointment  of  or  taking  possession  by a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the Company or any  Significant  Subsidiary or (C) effects any general
assignment for the benefit of creditors.

          If an Event of Default  (other than an Event of Default  specified  in
clause (g) or (h) above that occurs with respect to the  Company)  occurs and is
continuing  under the  Indenture,  the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes, then outstanding,  by written notice to
the Company (and to the Trustee if such notice is given by the Holders) may, and
the Trustee at the request of such Holders shall,  declare the principal  amount
of, premium, if any, and accrued interest on the Notes to be immediately due and
payable.

          If a  bankruptcy  or  insolvency  default  with respect to the Company
occurs  and is  continuing,  the Notes  automatically  become  due and  payable.
Holders  may not enforce the  Indenture  or the Notes  except as provided in the
Indenture.  The  Trustee  may  require  indemnity  satisfactory  to it before it
enforces the Indenture or the Notes. Subject to certain limitations,  Holders of
at least a majority in principal amount of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.

15.   TRUSTEE DEALINGS WITH COMPANY.

          The  Trustee  under  the  Indenture,  in its  individual  or any other
capacity,  may make loans to, accept deposits from and perform  services for the
Company  or its  Affiliates  and may  otherwise  deal  with the  Company  or its
Affiliates as if it were not the Trustee.

16.   NO RECOURSE AGAINST OTHERS.

          No incorporator or any past,  present or future partner,  stockholder,
other equity holder, officer, director,  employee or controlling person as such,
of the  Company or of any  successor  Person  shall have any  liability  for any
obligations  of the Company  under the Notes or the  Indenture  or for any claim
based on, in respect of or by reason of,  such  obligations  or their  creation.
Each Holder by  accepting a Note waives and  releases  all such  liability.  The
waiver and release are part of the consideration for the issuance of the Notes.

17.   AUTHENTICATION.

                                      B-9
<PAGE>

          This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.

18.   ABBREVIATIONS.

          Customary  abbreviations  may be used in the  name of a  Holder  or an
assignee,  such as:  TEN COM (= tenants  in  common),  TEN ENT (= tenants by the
entireties),  JT TEN (= joint  tenants  with  right of  survivorship  and not as
tenants in common),  CUST (=  Custodian)  and U/G/M/A (= Uniform Gifts to Minors
Act).

THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

          The  Company  will  furnish to any Holder  upon  written  request  and
without  charge a copy of the Indenture.  Requests may be made to Viatel,  Inc.,
685 Third Avenue, New York, New York, 10017, Attention: General Counsel.

                                      B-10
<PAGE>

                 SCHEDULE OF PRINCIPAL AMOUNT OF INDEBTEDNESS
                             EVIDENCED BY THIS NOTE

          The initial  principal  amount of indebtedness  evidenced by this Note
shall be Euro [___]. The following  decreases/increases  in the principal amount
evidenced by this Note have been made:

             Decrease    Increase
             in          in
             Principal   Principal   Total Principal
             Amount of   Amount of   Amount of this       Notation Made
Date of      this        this        Global Note          by or on
Decrease/    Global      Global      Following such       Behalf of
Increase     Note        Note        Decrease/Increase    Trustee
-------      ---------   ---------   -----------------    -------------

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

                                      B-11
<PAGE>

                            [FORM OF TRANSFER NOTICE]

          FOR VALUE RECEIVED the undersigned  registered  holder hereby sell(s),
assign(s) and transfer(s) unto

INSERT TAXPAYER IDENTIFICATION NO.

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

Please print or typewrite name and address including zip code of assignee

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

the within Note and all rights thereunder,  hereby irrevocably  constituting and
appointing  _______________________________________________ attorney to transfer
said Note on the books of the  Company  with full power of  substitution  in the
premises.

                   [THE FOLLOWING PROVISION TO BE INCLUDED
                   ON ALL NOTES OTHER THAN EXCHANGE NOTES,
                       UNLEGENDED REGULATION S GLOBAL AND
                   UNLEGENDED REGULATION S CERTIFICATED NOTES]

In connection  with any transfer of this Note occurring  prior to the date which
is the earlier of (i) the date of an effective  Registration  or (ii) the end of
the period  referred to in Rule 144(k) under the Securities Act, the undersigned
confirms that without utilizing any general  solicitation or general advertising
that:

                                   [CHECK ONE]

[      ] (a)  this Note is being  transferred  in compliance  with the exemption
              from  registration  under the  Securities Act of 1933, as amended,
              provided by Rule 144A thereunder.

                                       OR

[      ] (b)  this Note is being  transferred  other than in accordance with (a)
              above and  documents  are being  furnished  which  comply with the
              conditions of transfer set forth in this Note and the Indenture.

If none of the foregoing boxes is checked,  the Trustee or other Registrar shall
not be obligated to register  this Note in the name of any Person other than the
Holder  hereof  unless  and  until  the  conditions  to  any  such  transfer  of
registration  set forth herein and in Section 2.08 of the  Indenture  shall have
been satisfied.

Date:
     ----------------------                               ----------------------
                              NOTICE:  The  signature  to this  assignment  must
                              correspond  with the name as written upon the face
                              of  the   within-mentioned   instrument  in  every
                              particular,   without  alteration  or  any  change
                              whatsoever.

                                      B-12
<PAGE>

TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

          The  undersigned  represents  and warrants that it is purchasing  this
Note for its own account or an account with  respect to which it exercises  sole
investment  discretion  and  that  it  and  any  such  account  is a  "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended,  and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges  that it has received such information  regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request  such  information  and that it is aware that the  transferor  is
relying upon the undersigned's  foregoing  representations in order to claim the
exemption from registration provided by Rule 144A.

Dated:
      ----------------------                              ----------------------
                              NOTICE: To be executed by an executive officer

                                      B-13
<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

          If you wish to have this Note  purchased  by the  Company  pursuant to
Section 4.11 or Section 4.12 of the Indenture, check the Box:  | X |
                                                                ---

          If you wish to have a portion of this Note  purchased  by the  Company
pursuant to Section 4.11 or Section 4.12 of the Indenture,  state the amount (in
principal amount): Euro _____________.

Date:
     ----------------------

Your Signature:
               --------------------------
              (Sign exactly as your name appears on the other side of this Note)

Signature Guarantee:  ______________________________

                                      B-14
<PAGE>

                                                                       EXHIBIT C
                         FORM OF U.S. CERTIFICATED NOTE

                                 [FACE OF NOTE]

THIS NOTE HAS NOT BEEN  REGISTERED  UNDER THE U.S.  SECURITIES  ACT OF 1933,  AS
AMENDED (THE  "SECURITIES  ACT"), OR ANY STATE SECURITIES LAWS, AND ACCORDINGLY,
MAY NOT BE OFFERED,  SOLD,  PLEDGED OR OTHERWISE  TRANSFERRED  WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED  INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN
AN OFFSHORE  TRANSACTION  IN COMPLIANCE  WITH RULE 903 OF REGULATION S UNDER THE
SECURITIES  ACT; (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO
IN RULE 144(k) AS IN EFFECT ON THE DATE OF SUCH  TRANSFER,  RESELL OR  OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO VIATEL, INC. OR ANY SUBSIDIARY THEREOF,  (B) TO
A  QUALIFIED  INSTITUTIONAL  BUYER  IN  COMPLIANCE  WITH  RULE  144A  UNDER  THE
SECURITIES ACT, (C) TO AN INSTITUTIONAL  ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER,   FURNISHES  TO  THE  TRUSTEE  A  SIGNED  LETTER  CONTAINING   CERTAIN
REPRESENTATIONS  AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH  LETTER CAN BE OBTAINED  FROM THE  TRUSTEE)  AND IF SUCH
TRANSFER IS IN RESPECT OF AN  AGGREGATE  PRINCIPAL  AMOUNT OF NOTES OF LESS THAN
EURO  100,000,  AN OPINION  OF COUNSEL  ACCEPTABLE  TO  VIATEL,  INC.  THAT SUCH
TRANSFER IS IN COMPLIANCE  WITH THE SECURITIES  ACT, (D) TO A PERSON OUTSIDE THE
UNITED STATES IN AN OFFSHORE  TRANSACTION IN COMPLIANCE  WITH REGULATION S UNDER
THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION  PROVIDED BY
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT AND (3) AGREES  THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS NOTE IS  TRANSFERRED A NOTICE  SUBSTANTIALLY
TO THE EFFECT OF THIS  LEGEND.  IN  CONNECTION  WITH ANY  TRANSFER  OF THIS NOTE
WITHIN THE TIME PERIOD REFERRED TO ABOVE,  THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF  RELATING TO THE MANNER OF SUCH TRANSFER AND
SUBMIT  THIS  CERTIFICATE  TO THE  TRUSTEE.  IF THE  PROPOSED  TRANSFEREE  IS AN
INSTITUTIONAL  ACCREDITED  INVESTOR,  THE HOLDER MUST,  PRIOR TO SUCH  TRANSFER,
FURNISH TO EACH OF THE TRUSTEE  AND  VIATEL,  INC.  SUCH  CERTIFICATIONS,  LEGAL
OPINIONS OR OTHER INFORMATION AS SUCH PERSONS MAY REASONABLY  REQUIRE TO CONFIRM
THAT  SUCH  TRANSFER  IS BEING  MADE  PURSUANT  TO AN  EXEMPTION  FROM,  OR IN A
TRANSACTION NOT SUBJECT TO,

                                      C-1
<PAGE>

THE REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN,  THE TERMS
"OFFSHORE  TRANSACTION",  "UNITED  STATES" AND "U.S.  PERSON"  HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION  REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE
IN VIOLATION OF THE FOREGOING RESTRICTIONS.

                                      C-2
<PAGE>

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note Due 2008

No.________                                                     Euro____________

                                          Issue Date: April 20, 2000

          VIATEL,  INC.,  a  Delaware  corporation  (the  "Company",  which term
includes any successor under the Indenture  hereinafter  referred to), for value
received,  promises to pay to _____________________,  or its registered assigns,
upon surrender hereof the principal sum of Euro__________ on April 15, 2008.

          Interest Payment Dates:  April 15 and October 15,  commencing  October
15, 2000.

          Record Dates: April 1 and October 1.

          Reference  is hereby made to the further  provisions  of this Note set
forth on the reverse  hereof,  which further  provisions  shall for all purposes
have the same effect as if set forth at this place.

                                      C-3
<PAGE>

          IN WITNESS  WHEREOF,  the  Company  has caused  this Note to be signed
manually or by facsimile by its duly authorized officers.

Date: April 20, 2000                      VIATEL, INC.

                                          By____________________________________
                                          Name:
                                          Title:

                                          By____________________________________
                                          Name:
                                          Title:

                  (Trustee's Certificate of Authentication)

This  is  one of  the 12-3/4%  Senior  Euro  Notes  due  2008  described  in the
within-mentioned Indenture.

Date:  April 20, 2000                     THE BANK OF NEW YORK, as Trustee

                                          By____________________________________
                                               Authorized Signatory

                                      C-4
<PAGE>

                             [REVERSE SIDE OF NOTE]

                                  VIATEL, INC.

                        12 3/4% Senior Euro Note due 2008

1.    PRINCIPAL AND INTEREST.

          The Company will pay the principal of this Note on April 15, 2008.

          The Company  promises to pay interest on the principal  amount of this
Note on each Interest  Payment  Date, as set forth below,  at the rate per annum
shown above.

          Interest  will be  payable  semiannually  in cash (to the  holders  of
record  of the  Notes at the  close of  business  on the  April 1 or  October  1
immediately  preceding the Interest Payment Date) on each Interest Payment Date,
commencing October 15, 2000. Interest will be computed on the basis of a 360 day
year of twelve 30 day months.

          If an  exchange  offer  registered  under  the  Securities  Act is not
consummated,  and a shelf  registration  statement under the Securities Act with
respect to resales of the Notes is not declared effective by the Commission,  on
or before the date that is 180 days after the Closing  Date in  accordance  with
the terms of the Registration  Rights Agreement dated April 14, 2000 between the
Company  and Morgan  Stanley & Co.  International  Limited,  as the  manager for
itself and the several  placement  agents  named on Schedule I to the  Placement
Agreement  dated  April 14,  2000,  annual  interest  (in  addition  to interest
otherwise due on the Notes) will accrue,  at an annual rate of 0.5% per annum of
the principal amount,  payable in cash semiannually,  in arrears on April 15 and
October 15 of each year, commencing October 15, 2000 until the consummation of a
registered exchange offer or the effectiveness of a shelf-registration statement
with respect to resale of this Note.  The Holder of this Note is entitled to the
benefits of such Registration Rights Agreement.

          The Company shall pay interest on overdue  principal  and premium,  if
any, and interest on overdue installments of interest,  to the extent lawful, at
a rate per annum that is 12 3/4% per annum.

2.    METHOD OF PAYMENT.

          The Company will pay principal as provided above and interest  (except
defaulted  interest) on the principal  amount of the Notes as provided  above on
each April 15 and October 15 to the Persons who are Holders (as reflected in the
Note  Register  at the  close  of  business  on  such  April  1 and  October  1,
immediately preceding the Interest Payment Date), in each case, even if the Note
is cancelled on  registration of transfer or registration of exchange after such
record  date;  PROVIDED  that,  with  respect to the payment of  principal,  the
Company will not make payment to the Holder unless this Note is surrendered to a
Paying Agent.

                                      C-5
<PAGE>

          The  Company  will pay  principal,  premium,  if any,  and as provided
above,  interest in Euros.  However, the Company may pay principal,  premium, if
any, and interest by its check payable in such currency. It may mail an interest
check to a Holder's registered address (as reflected in the Note Register). If a
payment date is a date other than a Business Day at a place of payment,  payment
may be made at that place on the next  succeeding day that is a Business Day and
no interest shall accrue for the intervening period.

3.    PAYING AGENT AND REGISTRAR.

          Initially, the Trustee will act as U.S. Paying Agent and Registrar and
the Trustee  (through  its London  Branch)  will act as Euro Paying  Agent.  The
Company  will  maintain a paying  agent in  Frankfurt in the event the Notes are
listed on the  Frankfurt  over-the-counter  market.  The  Company may change any
Paying Agent or Registrar  without  notice.  The Company,  any Subsidiary or any
Affiliate of any of them may act as Paying Agent, Registrar or co-Registrar.

4.    INDENTURE; ISSUANCE OF ADDITIONAL NOTES.

          This Note is one of a duly  authorized  issue of Notes of the  Company
designated its 12 3/4% Senior Euro Notes due 2008, issued and to be issued under
an Indenture dated as of April 20, 2000 (the  "Indenture"),  between the Company
and the Trustee.  Capitalized  terms herein are used as defined in the Indenture
unless otherwise  indicated.  The terms of the Notes include those stated in the
Indenture  and  those  made  part of the  Indenture  by  reference  to the Trust
Indenture Act. The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Trust  Indenture Act for a statement of all such terms.
To the extent  permitted by  applicable  law, in the event of any  inconsistency
between the terms of this Note and the terms of the Indenture,  the terms of the
Indenture shall control.

5.    REPURCHASE UPON CHANGE IN CONTROL.

          Upon the  occurrence of any Change of Control,  each Holder shall have
the right to require the repurchase of its Notes by the Company in cash pursuant
to the offer described in the Indenture at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid  interest,  if any, to the date
of purchase (the "Change of Control Payment").

          A notice of such Change of Control will be mailed within 30 days after
any Change of Control occurs to each Holder at his last address as it appears in
the Note  Register.  Notes in original  denominations  larger than Euro 1,000 of
principal  amount may be sold to the  Company in part.  On and after the date of
the Change of Control Payment, interest ceases to accrue on Notes or portions of
Notes  surrendered for purchase by the Company,  unless the Company  defaults in
the payment of the Change of Control Payment.

6.    REGISTRATION RIGHTS

          Pursuant to the  Registration  Rights  Agreement,  the Company will be
obligated,  within 180 days  after the issue date of this Note,  to use its best
efforts to  consummate  an exchange  offer  pursuant to which the Holder of this

                                      C-6
<PAGE>

Note shall have the right to exchange this Note for the Company's Exchange Notes
(as defined in the  Registration  Rights  Agreement)  which have been registered
under the Securities Act, in like principal amount and having terms identical in
all material  respects to the initial  Notes.  The Holders of the initial  Notes
shall be entitled to receive certain  additional  interest payments in the event
such exchange offer is not  consummated and upon certain other  conditions,  all
pursuant and in accordance with the terms of the Registration Rights Agreement.

7.    DENOMINATIONS; TRANSFER; EXCHANGE.

          The Notes are in registered form without coupons in  denominations  of
Euro 1,000 of  principal  amount  and any  integral  multiples  of Euro 1,000 in
excess  thereof.  A Holder may  register  the  transfer  or exchange of Notes in
accordance with the Indenture.  The Registrar may require a Holder,  among other
things, to furnish  appropriate  endorsements and transfer  documents and to pay
any taxes and fees required by law or permitted by the Indenture.

8.    PERSONS DEEMED OWNERS.

          A Holder shall be treated as the owner of a Note for all purposes.

9.    UNCLAIMED MONEY.

          If money for the payment of  principal,  premium,  if any, or interest
remains  unclaimed for two years,  the Trustee and the Paying Agent will pay the
money back to the Company at its request.  After that,  Holders  entitled to the
money must look to the Company for  payment,  unless an  abandoned  property law
designates  another  Person,  and all  liability  of the Trustee and such Paying
Agent with respect to such money shall cease.

10.   DISCHARGE PRIOR TO REDEMPTION OR MATURITY.

          If the  Company  deposits  with  the  Trustee  money  and/or  European
Government  Obligations  sufficient  to pay the then  outstanding  principal of,
premium,  if any,  and  accrued  interest  on the  Notes  (a) to  redemption  or
maturity,  the Company  will be  discharged  from the  Indenture  and the Notes,
except in certain  circumstances for certain sections thereof, and (b) to Stated
Maturity, the Company will be discharged from certain covenants set forth in the
Indenture.

11.   AMENDMENT; SUPPLEMENT; WAIVER.

          Subject  to  certain  exceptions,  the  Indenture  or the Notes may be
amended or  supplemented  with the consent of the Holders of at least a majority
in principal amount of the Notes then  outstanding,  and any existing default or
compliance  with any  provision may be waived with the consent of the Holders of
at least a majority in principal amount of the Notes then  outstanding.  Without
notice  to or the  consent  of any  Holder,  the  parties  thereto  may amend or
supplement  the  Indenture  or the  Notes  to,  among  other  things,  cure  any
ambiguity,  defect or inconsistency and make any change that does not materially
and adversely affect the rights of any Holder.

                                      C-7
<PAGE>

12.   RESTRICTIVE COVENANTS.

          The  Indenture  imposes  certain  limitations  on the  ability  of the
Company  and  its  Restricted   Subsidiaries,   among  other  things,  to  Incur
Indebtedness,  make  Restricted  Payments,  use the  proceeds  from Asset Sales,
engage in transactions  with Affiliates or, with respect to the Company,  merge,
consolidate or transfer  substantially  all of its assets.  Within 90 days after
the end of the last fiscal  quarter of each year, the Company must report to the
Trustee on compliance with the terms of the Indenture.

13.   SUCCESSOR PERSONS.

          When a successor Person or other entity assumes all the obligations of
its predecessor under the Notes and the Indenture,  the predecessor  Person will
be released from those obligations.

14.   DEFAULTS AND REMEDIES.

          The  following  events  constitute   "Events  of  Default"  under  the
Indenture:  (a) default in the payment of principal of (or premium,  if any, on)
any Note when the same becomes due and payable at maturity,  upon  acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note when
the same becomes due and payable,  and such default continues for a period of 30
days;  PROVIDED that a failure to make any of the first three scheduled interest
payments  on this Note in a timely  manner will  constitute  an Event of Default
with no grace or cure period;  (c) default in the  performance  or breach of the
provisions of the Indenture applicable to mergers,  consolidations and transfers
of all or substantially  all of the assets of the Company or the failure to make
or  consummate  an Offer to  Purchase in  accordance  with  Section  4.11 of the
Indenture  or Section  4.12 of the  Indenture;  (d) the Company  defaults in the
performance of or breaches any other covenant or agreement of the Company in the
Indenture or under the Notes (other than a default  specified in clause (a), (b)
or (c) of Section 6.01 of the  Indenture)  and such default or breach  continues
for a period of 30  consecutive  days after written notice by the Trustee or the
Holders of 25% or more in  aggregate  principal  amount or  principal  amount of
Notes;  (e) there occurs with respect to any issue or issues of  Indebtedness of
the Company or any Significant Subsidiary having an outstanding principal amount
of $10 million or more in the aggregate for all such issues of all such Persons,
whether such Indebtedness now exists or shall hereafter be created, (I) an event
of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such  Indebtedness has not been
discharged  in full or such  acceleration  has not been  rescinded  or  annulled
within 30 days of such acceleration  and/or (II) the failure to make a principal
payment at the final (but not any interim)  fixed  maturity  and such  defaulted
payment  shall not have been  made,  waived or  extended  within 30 days of such
payment default;  (f) any final judgment or order (not covered by insurance) for
the  payment  of money in excess of $10  million in the  aggregate  for all such
final  judgments or orders against all such Persons  (treating any  deductibles,
self-insurance  or  retention as not so covered)  shall be rendered  against the
Company or any Significant  Subsidiary and shall not be paid or discharged,  and
there shall be any period of 60 consecutive  days  following  entry of the final
judgment or order that causes the aggregate  amount for all such final judgments
or orders  outstanding  and not paid or  discharged  against all such Persons to

                                      C-8
<PAGE>

exceed $10 million  during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; (g) a
court  having  jurisdiction  in the  premises  enters a decree  or order for (A)
relief in respect of the Company or any Significant Subsidiary in an involuntary
case under any  applicable  bankruptcy,  insolvency  or other similar law now or
hereafter  in effect,  (B)  appointment  of a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the  Company or any  Significant  Subsidiary  or (C) the winding up or
liquidation of the affairs of the Company or any Significant  Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60  consecutive  days; or (h) the Company or any  Significant  Subsidiary (A)
commences a voluntary case under any applicable bankruptcy,  insolvency or other
similar law now or hereafter in effect, or consents to the entry of an order for
relief  in an  involuntary  case  under  any  such  law,  (B)  consents  to  the
appointment  of  or  taking  possession  by a  receiver,  liquidator,  assignee,
custodian,  trustee,  sequestrator  or similar  official  of the  Company or any
Significant  Subsidiary  or for all or  substantially  all of the  property  and
assets of the Company or any  Significant  Subsidiary or (C) effects any general
assignment for the benefit of creditors.

          If an Event of Default  (other than an Event of Default  specified  in
clause (g) or (h) above that occurs with respect to the  Company)  occurs and is
continuing  under the  Indenture,  the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes, then outstanding,  by written notice to
the Company  (and to the Trustee if such notice is given by the  Holders) , may,
and the  Trustee at the request of such  Holders  shall,  declare the  principal
amount of, premium,  if any, and accrued interest on the Notes to be immediately
due and payable.

          If a  bankruptcy  or  insolvency  default  with respect to the Company
occurs  and is  continuing,  the Notes  automatically  become  due and  payable.
Holders  may not enforce the  Indenture  or the Notes  except as provided in the
Indenture.  The  Trustee  may  require  indemnity  satisfactory  to it before it
enforces the Indenture or the Notes. Subject to certain limitations,  Holders of
at least a majority in principal amount of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.

15.   TRUSTEE DEALINGS WITH COMPANY.

          The  Trustee  under  the  Indenture,  in its  individual  or any other
capacity,  may make loans to, accept deposits from and perform  services for the
Company  or its  Affiliates  and may  otherwise  deal  with the  Company  or its
Affiliates as if it were not the Trustee.

16.   NO RECOURSE AGAINST OTHERS.

          No incorporator or any past,  present or future partner,  stockholder,
other equity holder, officer, director,  employee or controlling person as such,
of the  Company or of any  successor  Person  shall have any  liability  for any
obligations  of the Company  under the Notes or the  Indenture  or for any claim
based on, in respect of or by reason of,  such  obligations  or their  creation.
Each Holder by  accepting a Note waives and  releases  all such  liability.  The
waiver and release are part of the consideration for the issuance of the Notes.

17.   AUTHENTICATION.

                                      C-9
<PAGE>

          This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.

18.   ABBREVIATIONS.

          Customary  abbreviations  may be used in the  name of a  Holder  or an
assignee,  such as:  TEN COM (= tenants  in  common),  TEN ENT (= tenants by the
entireties),  JT TEN (= joint  tenants  with  right of  survivorship  and not as
tenants in common),  CUST (=  Custodian)  and U/G/M/A (= Uniform Gifts to Minors
Act).

      THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

          The  Company  will  furnish to any Holder  upon  written  request  and
without  charge a copy of the Indenture.  Requests may be made to Viatel,  Inc.,
685 Third Avenue, New York, New York, 10017, Attention: General Counsel.

                                      C-10
<PAGE>

                            [FORM OF TRANSFER NOTICE]

          FOR VALUE RECEIVED the undersigned  registered  holder hereby sell(s),
assign(s) and transfer(s) unto

INSERT TAXPAYER IDENTIFICATION NO.

--------------------------------------------------
Please print or typewrite name and address including zip code of assignee

--------------------------------------------------   the  within  Note  and  all
rights   thereunder,    hereby    irrevocably    constituting   and   appointing
__________________________________  attorney to transfer  said Note on the books
of the Company with full power of substitution in the premises.

                   [THE FOLLOWING PROVISION TO BE INCLUDED
                   ON ALL NOTES OTHER THAN EXCHANGE NOTES,
                       UNLEGENDED REGULATION S GLOBAL AND
                   UNLEGENDED REGULATION S CERTIFICATED NOTES]

          In connection  with any transfer of this Note  occurring  prior to the
date which is the earlier of (i) the date of an effective  Registration  or (ii)
the end of the period  referred to in Rule 144(k) under the Securities  Act, the
undersigned  confirms that without utilizing any general solicitation or general
advertising that:

                                   [CHECK ONE]

[     ] (a)   this Note is being  transferred  in compliance  with the exemption
              from  registration  under the  Securities Act of 1933, as amended,
              provided by Rule 144A thereunder.

                                       OR

[     ] (b)   this Note is being  transferred  other than in accordance with (a)
              above and  documents  are being  furnished  which  comply with the
              conditions of transfer set forth in this Note and the Indenture.

If none of the foregoing boxes is checked,  the Trustee or other Registrar shall
not be obligated to register  this Note in the name of any Person other than the
Holder  hereof  unless  and  until  the  conditions  to  any  such  transfer  of
registration  set forth herein and in Section 2.08 of the  Indenture  shall have
been satisfied.

Date:____________________
                              NOTICE:  The  signature  to this  assignment  must
                              correspond  with the name as written upon the face
                              of  the   within-mentioned   instrument  in  every
                              particular,   without  alteration  or  any  change
                              whatsoever.

                                      C-11
<PAGE>

TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

          The  undersigned  represents  and warrants that it is purchasing  this
Note for its own account or an account with  respect to which it exercises  sole
investment  discretion  and  that  it  and  any  such  account  is a  "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended,  and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges  that it has received such information  regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request  such  information  and that it is aware that the  transferor  is
relying upon the undersigned's  foregoing  representations in order to claim the
exemption from registration provided by Rule 144A.

Dated:____________________    __________________________________________________
                              NOTICE: To be executed by an executive officer

                                      C-12
<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

          If you wish to have this Note  purchased  by the  Company  pursuant to
Section 4.11 or Section 4.12 of the Indenture, check the Box:

          If you wish to have a portion of this Note  purchased  by the  Company
pursuant to Section 4.11 or Section 4.12 of the Indenture,  state the amount (in
principal amount): Euro _____________.

Date:

Your Signature:___________________________________
               (Sign exactly as your name appears on the otherside of this Note)

Signature Guarantee: ______________________________

                                      C-13
<PAGE>

                                                                       EXHIBIT D

                               FORM OF CERTIFICATE

The Bank of New York                                                      [DATE]
101 Barclay Street, Floor 21 West
New York, NY  10286
Attention:  Corporate Trust Administration

          Re: Viatel, Inc. (the "Company")
              12 3/4% Senior Euro Notes
              DUE 2008 (THE "NOTES")

Ladies and Gentlemen:

          This  letter  relates to  Euro____________  principal  amount of Notes
represented  by a Note (the  "Legended  Note")  which  bears a legend  outlining
restrictions  upon transfer of such Legended  Note.  Pursuant to Section 2.02 of
the  Indenture  (the  "Indenture")  dated as of April 20,  2000  relating to the
Notes, we hereby certify that we are (or we will hold such Notes on behalf of) a
person  outside  the United  States to whom the Notes  could be  transferred  in
accordance with Rule 904 of Regulation S promulgated  under the U.S.  Securities
Act of 1933, as amended.  Accordingly,  you are hereby requested to exchange the
legended  certificate  for an unlegended  certificate  representing an identical
principal amount of Notes, all in the manner provided for in the Indenture.

          You and the  Company  are  entitled  to rely upon this  letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any  administrative  or legal  proceedings  or  official  inquiry  with
respect to the matters covered hereby.  Terms used in this  certificate have the
meanings set forth in Regulation S.

                                    Very truly yours,

                                    [Name of Holder]

                                    By:_____________________________
                                            Authorized Signature

                                      D-1
<PAGE>

                                                                       EXHIBIT E

                       Form of Certificate to Be Delivered
                          in Connection with Transfers
                            PURSUANT TO REGULATION S

The Bank of New York                                                      [DATE]
101 Barclay Street, Floor 21 West
New York, NY  10286
Attention:  Corporate Trust Administration

                        Re: Viatel, Inc. (the "Company")
                            12 3/4% Senior Euro Notes
                            DUE 2008 (THE "NOTES")

Ladies and Gentlemen:

          In  connection  with  our  proposed  sale  of Euro  _______  aggregate
principal  amount of the  Notes,  we  confirm  that such sale has been  effected
pursuant to and in  accordance  with  Regulation S under the  Securities  Act of
1933, as amended, and, accordingly, we represent that:

          (1) the  offer of the  Notes  was not made to a person  in the  United
     States;

          (2) at the time the buy  order  was  originated,  the  transferee  was
     outside  the  United  States  or we and any  person  acting  on our  behalf
     reasonably believed that the transferee was outside the United States;

          (3) no  directed  selling  efforts  have been made by us in the United
     States in  contravention  of the requirements of Rule 903(b) or Rule 904(b)
     of Regulation S, as applicable; and

          (4) the  transaction  is not part of a plan or  scheme  to  evade  the
     registration requirements of the U.S. Securities Act of 1933.

                                      E-1
<PAGE>

          You and the  Company  are  entitled  to rely upon this  letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any  administrative  or legal  proceedings  or  official  inquiry  with
respect to the matters covered hereby.  Terms used in this  certificate have the
meanings set forth in Regulation S.

                                    Very truly yours,

                                    [Name of Transferor]

                                    By:_____________________________
                                            Authorized Signature

                                      E-2
<PAGE>

                                                                       EXHIBIT F

                            Form of Certificate to Be
                          Delivered in Connection with
                  TRANSFERS TO NON-QIB ACCREDITED INVESTORS

The Bank of New York                                                      [DATE]
101 Barclay Street, Floor 21 West
New York, NY  10286
Attention:  Corporate Trust Administration

          Re: Viatel, Inc. (the "Company")
              12 3/4% Senior Euro Notes
              DUE 2008 (THE "NOTES")

Dear Sirs:

          In connection with our proposed purchase of Euro ___________ aggregate
principal amount of the Notes, we confirm that:

          1. We understand that any subsequent  transfer of the Notes is subject
     to certain  restrictions and conditions set forth in the Indenture dated as
     of  April  20,  2000  relating  to the  Notes  (the  "Indenture")  and  the
     undersigned  agrees to be bound by, and not to resell,  pledge or otherwise
     transfer  the Notes  except  in  compliance  with,  such  restrictions  and
     conditions  and the  Securities  Act of 1933,  as amended (the  "Securities
     Act").

          2. We  understand  that the offer and sale of the Notes  have not been
     registered  under the Securities Act, and that the Notes may not be offered
     or sold except as permitted in the following sentence. We agree, on our own
     behalf and on behalf of any accounts for which we are acting as hereinafter
     stated,  that if we should  sell any  Notes,  we will do so only (A) to the
     Company or any subsidiary  thereof,  (B) in accordance with Rule 144A under
     the  Securities  Act  to a  "qualified  institutional  buyer"  (as  defined
     therein), (C) to an institutional  "accredited investor" (as defined below)
     that, prior to such transfer,  furnishes (or has furnished on its behalf by
     a  U.S.   broker-dealer)  to  you  and  to  the  Company  a  signed  letter
     substantially in the form of this letter,  (D) outside the United States in
     accordance  with Rule 904 of  Regulation  S under the  Securities  Act, (E)
     pursuant to the  provisions  of Rule 144 under the  Securities  Act, or (F)
     pursuant to an effective  registration  statement under the Securities Act,
     and we further agree to provide to any person  purchasing  any of the Notes
     from us a notice  advising  such  purchaser  that  resales of the Notes are
     restricted as stated herein.

          3. We understand that, on any proposed resale of any Notes, we will be
     required  to  furnish to you and the  Company  such  certifications,  legal

                                      F-1
<PAGE>

     opinions  and  other  information  as you and the  Company  may  reasonably
     require to confirm  that the  proposed  sale  complies  with the  foregoing
     restrictions.  We further  understand  that the Notes  purchased by us will
     bear a legend to the foregoing effect.

          4. We are an institutional  "accredited  investor" (as defined in Rule
     501(a)(1),  (2), (3) or (7) of Regulation D under the  Securities  Act) and
     have such knowledge and experience in financial and business  matters as to
     be capable of  evaluating  the  merits and risks of our  investment  in the
     Notes,  and we and any  accounts  for which we are  acting are each able to
     bear the economic risk of our or its investment.

          5. We are acquiring  the Notes  purchased by us for our own account or
     for one or more  accounts  (each of which is an  institutional  "accredited
     investor") as to each of which we exercise sole investment discretion.

          You and the  Company  are  entitled  to rely upon this  letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any  administrative  or legal  proceedings  or  official  inquiry  with
respect to the matters covered hereby.

                                    Very truly yours,

                                    [Name of Transferee]

                                    By:_____________________________
                                            Authorized Signature

                                      F-2

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