Document:

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                                                                   EXHIBIT 10.19

                             JOINT VENTURE AGREEMENT
                                   RELATING TO
                            EXODUS ASIA-PACIFIC LTD.

                         DATED AS OF SEPTEMBER 27, 2000

SHAREHOLDERS:

1. EXODUS                  EXODUS COMMUNICATIONS, INC., a Delaware corporation
                           with offices located at 2831 Mission College Blvd.,
                           Santa Clara, California 95054, United States of
                           America; and

2. ASIA GLOBAL             ASIA GLOBAL CROSSING, LTD., a company organized under
   CROSSING                the laws of Bermuda, with offices located at Wessex
                           House, 45 Reid Street, Hamilton HM12, Bermuda.
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                                TABLE OF CONTENTS

RECITALS

ARTICLE 1:        DEFINITIONS

ARTICLE 2:        OBJECT OF THE COMPANY; NAME

ARTICLE 3:        COMPLETION

ARTICLE 4:        APPOINTMENT OF DIRECTORS

ARTICLE 5:        ADDITIONAL FUNDING

ARTICLE 6:        COVENANTS, REPRESENTATIONS AND WARRANTIES

ARTICLE 7:        CONDUCT OF THE COMPANY'S AFFAIRS

ARTICLE 8:        DISPUTE RESOLUTION

ARTICLE 9:        INDEMNIFICATION; LIMITATIONS ON DAMAGES; CONTRACTUAL
                  LIMITATIONS

ARTICLE 10:       CONFIDENTIAL INFORMATION; PUBLIC ANNOUNCEMENTS

ARTICLES 11:      TRANSFERS OF INTERESTS AND ISSUANCE OF ADDITIONAL INTERESTS

ARTICLE 12:       VOTING AGREEMENT

ARTICLE 13:       DISSOLUTION AND WINDING UP

ARTICLE 14:       INDEPENDENT VALUATION

ARTICLE 15:       MISCELLANEOUS PROVISIONS

ARTICLE 16:       WAIVER OF CONFLICT OF INTEREST

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SCHEDULES:

      Schedule 1.48                 Network Agreement

      Schedule 6.4                  No Conflict

      Schedule 6.10                 Encumbrances on Joint Venture Interest

      Schedule 6.13                 Business Interests in the Territory

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                             JOINT VENTURE AGREEMENT
                                   RELATING TO
                            EXODUS ASIA-PACIFIC LTD.

THIS JOINT VENTURE AGREEMENT ("JOINT VENTURE AGREEMENT") relating to EXODUS
ASIA-PACIFIC LTD., a company with limited liability organized under the laws of
Bermuda made as of this 27th day of September, 2000.

                                    RECITALS

A.       EXODUS is in the business of providing mission critical Internet
         hosting, managed and professional services and content distribution
         services to business customers.

B.       ASIA GLOBAL CROSSING is in the business of providing pan-Asian Internet
         and long distance telecommunications facilities and services utilizing
         a network of undersea digital fiber optic cable systems and associated
         terrestrial backhaul capacity.

C.       EXODUS and ASIA GLOBAL CROSSING desire to enter into a joint venture
         (the "JOINT VENTURE") which shall operate through a company organized
         under the laws of Bermuda to be known as "Exodus Asia-Pacific Ltd."
         (the "COMPANY") on the terms and conditions set out below.

D.       The Shareholders desire to set out the rights, duties and obligations
         of the Shareholders in connection with the formation, ownership and
         operation of the Company.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, the Shareholders hereto, intending to be legal bound hereby, agree as
follows:

                                    ARTICLE 1
                                   DEFINITIONS

         Terms defined in the preamble, in the recitals and in the text hereof
shall have their respective meanings when used herein, and the following terms
used in this Joint Venture Agreement, whether singular or plural, shall (unless
otherwise expressly provided herein or unless the context otherwise requires)
have the following respective meanings:

         1.1 "ACCEPTANCE" is defined in Section 5.35.3.

         1.2 "ACCEPTANCE PERIOD" is defined in Section 11.2.

         1.3 "AFFILIATE" means any corporation, company, partnership, joint
venture, firm and/or entity which Controls, is Controlled by, or is under common
Control with a Shareholder, except that such term shall not include the Company.

         1.4 "AGREED PROPORTIONS" initially means 67% in respect of EXODUS
and 33% in respect of ASIA GLOBAL CROSSING and thereafter the percentages which
the nominal value

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of the Shares beneficially owned by each Shareholder respectively bears to the
combined nominal value of the fully issued and paid-up Shares of the Company.

         1.5 "ASIA GLOBAL CROSSING" means Asia Global Crossing Ltd., a company
organized under the laws of Bermuda.

         1.6 "ASIA GLOBAL CROSSING DIRECTOR" is defined in Section 4.2(b).

         1.7 "BANKRUPTCY" means the entry of an order for relief with respect to
a Shareholder in proceedings under any bankruptcy, insolvency or similar law of
the jurisdiction of organization of such Shareholder.

         1.8 "BOARD" means the Board of Directors of the Company.

         1.9 "BUSINESS" is defined in Section 2.1(a).

         1.10 "BUSINESS COMBINATION" is defined in Section 7.4(a).

         1.11 "BUY-OUT EVENT" means:

                  (a) The filing of an application by a Shareholder for, or its
         consent to, the appointment of a trustee, receiver, custodian or
         similar person under the applicable laws of the jurisdiction of
         organization of such Shareholder, for the assets of a Shareholder;

                  (b) The entry of a final order, judgment or decree by any
         court of competent jurisdiction appointing a trustee, receiver,
         custodian or similar person under the applicable laws of the
         jurisdiction of organization of such Shareholder, for the assets of a
         Shareholder;

                  (c) The failure by a Shareholder generally to pay its debts as
         they become due or a Shareholder's admission in writing of its
         inability to pay its debts as they become due;

                  (d) A Shareholder's Joint Venture Interest in the Company
         becoming subject to the enforcement of any rights of a creditor of a
         Shareholder, whether arising out of an attempted charge upon that
         Shareholder's Joint Venture Interest by judicial process or otherwise,
         if that Shareholder fails to effectuate the release of those
         enforcement rights, whether by legal process, bonding, or otherwise,
         within one hundred eighty (180) days; or

                  (e) The Bankruptcy of a Shareholder.

         1.12 "BUY-OUT EVENT DATE" means the date of an occurrence of a Buy-Out
Event.

         1.13 "CLOSING" shall mean the "Closing" as defined in the Merger
Agreement.

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         1.14 "COMPANY" means "Exodus Asia-Pacific Ltd.", a company formed
pursuant to this Joint Venture Agreement and organized under the laws of Bermuda
and any successor thereto.

         1.15 "CONFIDENTIAL INFORMATION" means any intellectual property of
non-public technical or business information written or orally disclosed or
delivered by one Shareholder or any of its Affiliates (the "DISCLOSING PARTY")
to another Shareholder or any of its Affiliates (the "RECEIVING Party").
Notwithstanding anything to the contrary in this Joint Venture Agreement,
Confidential Information shall not include:

                  (i)      any information or material that is publicly known or
                           available, or becomes publicly known or available,
                           without any act or omission of the Receiving Party;

                  (ii)     any information or material which prior to disclosure
                           was rightfully in the possession of the Receiving
                           Party without restriction on use or disclosure;

                  (iii)    any information or material that is rightfully
                           received by the Receiving Party from a non-party
                           without an obligation of confidence; or

                  (iv)     any information or material that is independently
                           developed by the Receiving Party without use or
                           reference to any Confidential Information of the
                           Disclosing Party.

         1.16 "CONTRIBUTED ASSETS" is defined in Section 3.1(c)(ii).

         1.17 "CONTROL", "CONTROLLED" or "CONTROLLING" means the control of a
person exercised through the direct or indirect ownership of greater than fifty
percent (50%) of the stock, shares or other voting interest of such person.

         1.18 "DEDICATED PRIVATE EXTRANET NETWORK" shall mean a private IP
Network connecting communities of interests.

         1.19 "DEFAULTING SHAREHOLDER" is defined in Section 11.9.

         1.20 "DIRECTOR" means a director of the Company including, where
applicable, an alternate director.

         1.21 "DISPOSITION," "DISPOSE" or "DISPOSING" refers to and means the
sale, assignment, transfer, exchange, pledge or encumbrance or other disposition
of all or any part of such Shareholder's Joint Venture Interest in the Company
or of some other specified property, in any manner, whether, voluntarily or
involuntarily, or by operation of law or otherwise; provided, however, that a
merger or other business combination of EXODUS or ASIA GLOBAL CROSSING shall not
be deemed a Disposition for purposes of this Joint Venture Agreement.

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                  1.22 "DISPUTE" is defined in Section 8.1.

                  1.23 "DOLLAR" or "$." means U.S. Dollars.

                  1.24 "EFFECTIVE TIME" means the Closing.

                  1.25 "ENTITLEMENT" is defined in Section 5.3.

                  1.26 "EQUITY SHARE CAPITAL" means all of the fully issued and
         paid up Shares of the Company.

                  1.27 "EXODUS" means EXODUS COMMUNICATIONS, INC., a Delaware
         corporation.

                  1.28 "EXODUS CORE TECHNOLOGIES" means the "EXODUS Core
         Technologies" as defined in the Licensing Agreement.

                  1.29 "EXODUS DIRECTOR" is defined in Section 4.2(a).

                  1.30 "EXODUS SERVICES" means all technical, professional and
         other services required in connection with the design, development,
         construction and operation of data centers and the conduct of the
         Company's Business furnished to the Company by Exodus.

                  1.31 "EXODUS STANDARD BUSINESS PRACTICES AND METHODOLOGIES"
         means the standard business practices and methodologies as executed by
         EXODUS globally as part of EXODUS' global operations, as adapted to
         local conditions if necessary.

                  1.32 "EXODUS TECHNICAL SPECIFICATIONS AND STANDARDS" means the
         EXODUS technical specifications and standards as promulgated by EXODUS
         globally as part of EXODUS' global operations, as adapted to local
         conditions if necessary. The Exodus Technical Specifications and
         Standards shall be applicable to the distribution of the Company's
         Services pursuant to reseller agreements to be entered into between the
         Company and its customers.

                  1.33 "EXPORT ADMINISTRATION ACT" is defined in Section 6.11.

                  1.34 "FISCAL YEAR" means the annual accounting period of the
         Company, which is the twelve months ended December 31, except that for
         2000, it is the period from the date of the Company's incorporation and
         ending on December 31, 2000.

                  1.35  "GLOBAL CROSSING" means GLOBAL CROSSING LTD., a company
         organized under the laws of Bermuda.

                  1.36 "INDEMNITEES" is defined in Section 9.1.

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                  1.37 "INTELLECTUAL PROPERTY RIGHTS" means all patent rights,
         copyright rights (including, but not limited to, rights in music and
         audiovisual works and Moral Rights), trademark rights, trade secret
         rights, design rights and confidentiality rights and any other
         intellectual property rights recognized by the law of each applicable
         jurisdiction.

                  1.38 "INTERNET" means a series of interconnected networks
         linked together by a globally unique address space based on the
         Internet Protocol (or a subsequent amendment or replacement protocol)
         and which supports the exchange of data and other messages using
         Transmission Control Protocol/Internet Protocol (TCP/IP) (or a
         subsequent amendment or replacement protocol).

                  1.39 "INTERNET BACKBONE" means a wireline or wireless network
         which: (i) can or does (a) assign IP addresses or manage IP address
         assignments for machines or networks to which it is connected, (b)
         accept or deliver IP datagrams from machines or networks to which it is
         connected, or (c) maintain IP packet traffic to other machines or
         networks; and (ii) provides IP connectivity on a regional, national or
         international basis.

                  1.40 "INTERNET DATA CENTER SERVICES" means services such as
         hosting, co-location and content distribution for the Internet.

                  1.41 "INTERNET PROTOCOLS" or "IP" means the Internet Protocols
         as defined by the document titled RFC-91, by John Postell of the
         University of Southern California, dated 1981, or subsequent revisions
         thereof.

                  1.42 "INTERNET WEB HOSTING" means the provision of Internet
         connectivity interconnected with servers, located within data centers
         used for the purpose of accessing content and applications.

                  1.43 "JOINT VENTURE" means the joint venture entered into
         pursuant to this Joint Venture Agreement.

                  1.44 "JOINT VENTURE AGREEMENT" means this Joint Venture
         Agreement, as originally executed and as amended from time to time in
         accordance with the terms hereof.

                  1.45 "JOINT VENTURE INTEREST" means, with respect to each
         Shareholder, the Shares that are owned by such Shareholder and all
         rights appurtenant thereto as a Shareholder of the Company under the
         Company's Memorandum of Association and as provided under the
         applicable provisions of the laws of Bermuda.

                  1.46 "LICENSING AGREEMENT" means the Licensing Agreement to be
         entered into by and between EXODUS and/or any of its Affiliates and the
         Company on or prior to the Effective Time in a form to be mutually
         agreed upon by the parties hereto which, at a minimum, shall grant to
         the Company an exclusive license in the Territory to all

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         Intellectual Property Rights of EXODUS necessary for the Company to
         pursue the Business and for the use of all trademarks owned by EXODUS
         in connection with the Business in consideration for the payment by the
         Company to EXODUS of a reasonable royalty not less favorable than that
         granted to unaffiliated third parties which royalty shall begin to
         accrue and be payable as measured from the first fiscal quarter that
         the Company becomes profitable.

                  1.47 "LOCAL PARTICIPANT" is defined in Section 6.14(c).

                  1.48 "LOSSES" shall mean any claims, losses, liabilities,
         damages, penalties, costs and expenses, including reasonable legal fees
         and expenses, incident to any of the foregoing or incurred in
         investigating or attempting to avoid the same or to oppose the
         imposition thereof, or in enforcing any indemnity.

                  1.49 "MEMORANDUM OF ASSOCIATION" means the Memorandum of
         Association of the Company and related By-laws of the Company.

                  1.50 "MERGER AGREEMENT" means the Agreement and Plan of
         Merger, dated as of the date hereof, among EXODUS and GLOBAL CROSSING
         and certain affiliated companies, as the same may from time to time be
         amended, modified or supplemented.

                  1.51 "MORAL RIGHTS" shall mean any right of paternity or
         integrity, any right to claim authorship, to object to or prevent any
         distortion, mutilation or modification of, or other derogatory action
         in relation to the subject work whether or not such would be
         prejudicial to the author's honor or reputation, to withdraw from
         circulation or control the publication or distribution of the subject
         work, and any similar right, existing under judicial or statutory law
         of any country in the world, or under any treaty, regardless of whether
         or not such right is denominated or generally referred to as a "moral"
         right.

                  1.52 "NETWORK AGREEMENT" means the Network Services Agreement,
         Marketing and Cooperation Agreement, as amended, supplemented or
         otherwise modified from time to time, and to be executed by such
         parties in the form attached as Schedule 1.48 hereto on or prior to the
         Effective Time.

                  1.53  "NOTICE OF PROPOSED SALE" is defined in Section 11.2.

                  1.54 "PERSON" shall mean any individual, sole proprietorship,
         corporation, partnership, company with limited liability,
         unincorporated society or association, trust, or other legal entity.

                  1.55 "QUALIFIED INITIAL PUBLIC OFFERING" is defined in Section
         11.12.

                  1.56 "QUORUM" is defined in Section 7.2(e).

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                  1.57 "RELATED AGREEMENTS" means the Licensing Agreement, the
         Network Agreements and the Services Agreement.

                  1.58 "REPRESENTATIVES" is defined in Section 10.1.

                  1.59 "REQUIRED ADDITIONAL EQUITY SHARE CAPITAL" is defined in
         Section 5.1.

                  1.60 "RESTRICTED BUSINESS" shall mean the provision of
         physical space with Internet connectivity interconnected with servers
         or other types of data processing equipment (other than solely data
         communications/networking equipment).

                  1.61 "SALE NOTICE" is defined in Section 11.10(b).

                  1.62 "SELLER" is defined in Section 11.10(a).

                  1.63 "SELLING SHAREHOLDER" is defined in Section 11.2.

                  1.64 "SERVICES" means the web hosting services provided by the
         Company directly or through one or more of its subsidiaries in the
         Territory.

                  1.65 "SERVICES AGREEMENT" means the Services Agreement to be
         entered into by and between EXODUS and the Company on or prior to the
         Effective Time in a form to be mutually agreed upon by the parties
         hereto for the provision of the EXODUS Services to the Company and
         which shall provide for the reimbursement by the Company of EXODUS'
         fully-burdened costs of providing such EXODUS Services.

                  1.66 "SHAREHOLDER" means each of EXODUS and ASIA GLOBAL
         CROSSING and each other Person that from time to time becomes a
         Shareholder pursuant to the terms of this Joint Venture Agreement.

                  1.67 "SHARES" means ordinary shares of par value $0.01 each in
         the capital of the Company with the rights, preferences and
         designations set out in the Company's Memorandum of Association.

                  1.68 "SUBSIDIARY" or "SUBSIDIARIES" means with respect to any
         Person (other than a natural individual), any other Person Controlled
         by such Person.

                  1.69 "TAG-ALONG RIGHT" is defined in Section 11.10(a).

                  1.70 "TAG-ALONG NOTICE" is defined in Section 11.10(b).

                  1.71 "TAX" and "TAXES" shall mean any and all national, local
         and foreign taxes, assessment and other governmental charges, duties,
         impositions and liabilities including taxes based upon or measured by
         gross receipts, income, profits, sales, use or occupation, and value
         added, ad valorem, transfer, franchise, withholding, payroll,
         recapture, employment, excise and property taxes, together with all
         interest, penalties and additions imposed with respect to such amounts.

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                  1.72 "TECHNICAL DATA" means all documentation and other
         technical information provided by any Shareholder and/or its Affiliates
         pursuant to this Joint Venture Agreement or the Related Agreements.

                  1.73 "TERM" means the Term of this Joint Venture Agreement as
         set out in Section 3.3.

                  1.74 "TERMINATION NOTICE" is defined in Section 3.3.

                  1.75 "TERRITORY" means the collective reference to Brunei,
         Burma, Cambodia, China (including Hong Kong), Fiji, Indonesia, Japan,
         Kiribati, Laos, Macau, Malaysia, Marshall Islands, Federated States of
         Micronesia, Mongolia, Nauru, North Korea, Palau, Papua New Guinea,
         Philippines, Samoa (formerly Western Samoa), Singapore, Solomon
         Islands, South Korea, Taiwan, Thailand, Tonga, Tuvalu, Vanuatu and
         Vietnam.

                  1.76 "TRANSFER TAXES" is defined in Section 3.1(c)(ii).

                  1.77 "TRIGGER EVENT" is defined in Section 3.3.

                  1.78 "VALUATION DATE" is defined in Section 14.3.

                                    ARTICLE 2
                           OBJECT OF THE COMPANY; NAME

         2.1 Business. The Shareholders are entering into the Joint Venture and
forming the Company under the laws of Bermuda for the purpose and scope as
follows:

                  (a) Purpose. The purpose of the Joint Venture is to directly
         or indirectly through one or more subsidiaries provide EXODUS' existing
         and future services made available to customers including, without
         limitation, Internet Data Center Services and Internet connectivity for
         data centers, managed service offerings, professional services and
         content distribution in accordance with EXODUS' Standard Business
         Practices and Methodologies in the Territory (the "BUSINESS").

                  (b) Other Activities. Subject to Section 7.4, the Shareholders
         may expand the scope of the Business as provided herein and will
         determine appropriate business models covering any expanded businesses.

         2.2 Name. The name of the Company shall be "Exodus Asia-Pacific Ltd."
in English, and all business of the Company shall be conducted under such name
or any other name approved at a general meeting of the Shareholders of the
Company, but in any case only to the extent permitted by applicable law and only
to the extent that the license granted to the Company for the use of the
"EXODUS" trade name and all associated Intellectual Property Rights is permitted
under the terms and conditions of the Licensing Agreement.

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         2.3 Principal Place of Business. The registered office of the Company
shall be in Hamilton, Bermuda and the principal place of business of the Company
at which the records required to be maintained by the laws of Bermuda are to be
kept shall be in such place or places as the Board shall specify.

                                    ARTICLE 3
                                   COMPLETION

         3.1 Formation of the Company. As soon as practicable following the full
execution of this Joint Venture Agreement and in accordance with all applicable
law:

                  (a) Organization. The Shareholders shall cause the Company to
         be established under the laws of Bermuda, or such other jurisdiction of
         organization as may be mutually agreed by the Shareholders, on the
         following basis:

                           (i) the Company shall be a company limited by Shares;

                           (ii) the name of the Company shall be "Exodus
                  Asia-Pacific Ltd." in English or such other name as agreed by
                  the Shareholders;

                           (iii) the registered head office of the Company will
                  be as specified in Section 2.3; and

                           (iv) the authorized share capital of the Company
                  shall be $10.00 divided into 1,000 Shares of $0.01 each.

                  (b) Subscription of Shares. Upon the Closing, or on a
         subsequent date to be mutually agreed by the Shareholders, the
         Shareholders shall subscribe for their respective Shares as set out
         below and pay to the Company (into a designated bank account at in
         Bermuda) in full in cash:

<TABLE>
<CAPTION>
                  SHAREHOLDER                                NO. OF SHARES                    CONSIDERATION
                  -----------                                -------------                    -------------
<S>                                                          <C>                          <C>
                  EXODUS                                          670                     U.S. $ 67,000,000

                  ASIA GLOBAL CROSSING                            330                     U.S. $ 33,000,000

                  Total                                          1000                     U.S. $100,000,000
</TABLE>

                  (c)      In-Kind Capital Contributions.

                           (i) Except for the Intellectual Property Rights
                  licensed pursuant to the Licensing Agreement and subject to
                  Section 6.14 concurrent with the subscription of Shares
                  provided for in subsection (b) above, each of the Shareholders
                  shall contribute to the Company, free and clear of all liens,
                  security interests, mortgages

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                  or other encumbrances, all tangible and intangible assets,
                  real and personal, necessary to the conduct of the Business in
                  the Territory now owned or hereafter acquired by such
                  Shareholders, including all equity ownership interests in
                  Persons, data centers, equipment, real property, improvements,
                  software, applications, databases, employees, customers,
                  agreements, prospective Web addresses, licenses and permits,
                  in each case to the Company or to the Company's Subsidiaries
                  organized to pursue the Business in the Territory, which
                  assets shall include at a minimum those set forth on Schedule
                  6.13 (collectively, the "CONTRIBUTED ASSETS").

                           (ii) Each Shareholder shall pay all sales, use,
                  transfer, real property transfer, recording, gains, stock
                  transfer and other similar taxes and fees ("TRANSFER TAXES")
                  incurred in connection with their respective in-kind capital
                  contributions to the Company and shall be responsible for
                  filing all necessary documentation and tax returns with
                  respect to such Transfer Taxes.

                  (d) Each of the Shareholders shall take or cause to be taken
         the following steps at Directors' and Shareholders' meetings of the
         Company (as appropriate):

                           (i) the appointment of the individuals specified in
                  Section 12.1 as Directors of the Company;

                           (ii) the appointment of KPMG as statutory auditor(s)
                  of the Company;

                           (iv) the allotment and issue by the Company of 670
                  Shares to EXODUS;

                           (v) the allotment and issue by the Company of 330
                  Shares to ASIA GLOBAL CROSSING; and

                           (vi) the execution of the Licensing Agreement, the
                  Network Agreements and the Services Agreement.

                  (e) The Shareholders shall commence efforts to identify,
         recruit and hire senior management personnel, subject to Board approval
         and appointment.

         3.2 Payment for Shares. The Shares shall be subscribed for cash and
shall be issued only upon the Company's receipt of payment in full.

         3.3 Duration. The Term of this Joint Venture Agreement shall commence
on the Effective Time and shall continue in effect until terminated upon:

                  (a) The mutual agreement of all Shareholders;

                  (b) if the Effective Time does not occur and the Merger
         Agreement is terminated; or

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                  (c) A resolution of Shareholders (subject to Section
         7.4(a)(ii)) or of a court with jurisdiction over the Company's affairs
         causing the Company to be wound-up.

Upon the occurrence of the event specified in Section 3.3(a) ("TRIGGER EVENT"),
either Shareholder may, within twenty-one (21) days of the Trigger Event, serve
a notice on the other Shareholder stating its desire to terminate this Joint
Venture Agreement (a "TERMINATION NOTICE") whereupon the Company shall be
wound-up and dissolved in accordance with Article 13 hereof.

                  (d) In the event that EXODUS shall no longer have the right to
         appoint a majority of the Directors comprising the Company's Board,
         then upon the occurrence of any of the following events:

                           (i)      the unauthorized use by the Company of the
                                    EXODUS Core Technologies or EXODUS Marks (as
                                    each term is defined in the Licensing
                                    Agreement), and such use is not promptly
                                    terminated by the Company upon its receipt
                                    of notice thereof; or

                           (ii)     the failure of the Company to adhere in any
                                    material respect to EXODUS Technical
                                    Specifications and Standards or the EXODUS
                                    Standard Business Practices and
                                    Methodologies and such failure is not cured
                                    by the Company within thirty (30) days upon
                                    its receipt of notice thereof; or

                           (iii)    the failure of the Company to make any
                                    payment under the Licensing Agreement and
                                    such failure continues for a period of not
                                    less than sixty (60) days; or

                           (iv)     any action by the Company which materially
                                    injures or degrades the "EXODUS" brand;

then EXODUS may by written notice served upon the other Shareholders (a "EXODUS
TERMINATION NOTICE") terminate this Joint Venture Agreement whereupon the
Company shall be wound-up and dissolved in accordance with Article 13 hereof.

                                    ARTICLE 4
                            APPOINTMENT OF DIRECTORS

         4.1 Number. The maximum number of Directors holding office at any time
shall be six (6) unless otherwise approved by the Shareholders in accordance
with this Joint Venture Agreement.

         4.2 Appointment. The Directors of the Company shall be appointed as
follows:

                  (a) EXODUS shall be entitled to appoint four (4) Directors to
         be designated as the EXODUS Directors ("EXODUS DIRECTORS"); and

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                  (b) ASIA GLOBAL CROSSING shall be entitled to appoint two (2)
         Director to be designated as the ASIA GLOBAL CROSSING Director ("ASIA
         GLOBAL CROSSING DIRECTORS").

In the event that the Board shall delegate any of its responsibilities to a
committee of the Board, the proportion of EXODUS Directors to ASIA GLOBAL
CROSSING Directors shall be no greater than two to one (2-1)

         4.3 Appointment of Chief Executive Officer. As soon as practicable
after the Effective Time, EXODUS shall nominate a candidate for election as the
Company's Chief Executive Officer subject to the approval of the Company's Board
of Directors (the "CHIEF EXECUTIVE OFFICER"). The Chief Executive Officer shall
serve for four (4) years from the date of such appointment. If the Chief
Executive Officer's employment shall terminate for any reason during this four
year period, EXODUS may nominate a further Chief Executive Officer to serve for
the remainder of such four (4) year term, subject to Board approval.

                                    ARTICLE 5
                               ADDITIONAL FUNDING

         5.1 Subscription for Additional Equity Share Capital by the
Shareholders. Subject to Section 11.9 hereinbelow, as determined by the Board,
each Shareholder may be required to subscribe for additional Shares in the
Agreed Proportions, up to an aggregate additional amount of (i) $200,000,000
(including the $100,000,000 initial capital subscription) during the first year,
(ii) $200,000,000 during the second year, and (iii) $200,000,000 during the
third year, each such period being measured from the Effective Time. Such Shares
shall be subscribed for in such amount and at such times as determined by the
Board upon a simple majority vote at which a Quorum is present and acting
throughout, as may be necessary and/or prudent to fund the requirements of the
Company as determined in the sole discretion of the Board (the "REQUIRED
ADDITIONAL EQUITY SHARE CAPITAL"). All subscriptions for Required Additional
Equity Share Capital shall be made at a subscription price per Share based upon
the valuation of the Company at the time of such subscription, as determined in
good faith by the Board. If any other person shall become a Shareholder, such
person shall be obligated to subscribe for additional Shares in the Agreed
Proportions, as amended, at the same time as the existing Shareholders and the
Required Additional Equity Share Capital shall be increased in accordance with
the following formula:

         E  =  R x EQ'/ EQ

         where:

         E        =        the Required Additional Equity Share Capital after
                           admission of the additional Shareholder, in U.S.
                           Dollars.

                                       12
<PAGE>   16
         R        =        the Required Additional Equity Share Capital prior to
                           admission of such Additional Shareholder, in U.S.
                           Dollars.

         EQ'      =        the aggregate amount of Equity Share Capital, in U.S.
                           Dollars, paid in by all Shareholders of the Company,
                           including the additional Shareholder.

         EQ       =        the aggregate amount of Equity Share Capital, in U.S.
                           Dollars, paid in by all Shareholders of the Company,
                           excluding the additional Shareholder.

         Notwithstanding the foregoing, the Shareholders shall cause the Company
to procure that the requirements of the Company for further capital to finance
the Business are met, as far as reasonably practicable in order to reduce the
Shareholders' capital contributions and maximize their return on invested equity
on the most favorable terms readily available which may include, without
limitation: borrowings from banks and other similar sources on the most
favorable terms reasonably obtainable as to interest, repayment and security,
but without allowing a prospective lender a right to participate in the Equity
Share Capital of the Company as a condition of a loan.

         5.2 Notice and Acceptance. Shareholders must respond, if at all, to the
Notice within thirty (30) days of receipt, informing the Company in writing how
many Shares they wish to purchase, which may be more or less than their
Entitlement (an "ACCEPTANCE"). Such Acceptances, once given, shall be
irrevocable by the Shareholder. If, with respect to any Notice, Shareholders
fail to give Acceptances within the requisite time period, in respect of all
Shares offered, the Company shall have ninety (90) days after the expiration of
the time in which the Acceptances are required to be delivered, in which to sell
the number of Shares for which Acceptances have not been received at a price not
less than that described in the Notice to such persons as holders of a majority
of the Shares held by Shareholders who have submitted Acceptances shall approve.

         5.3 Excess Acceptances. If the number of Shares in respect of which
Acceptances have been received exceeds the number of Shares being offered, the
Company may (i) increase the size of the offering to equal the number of Shares
in respect of which Acceptances have been received or (ii) allot each accepting
Shareholder its Entitlement and allot the balance of the Shares among those
Shareholders whose Acceptances are for a greater number of Shares than their
Entitlement, pro rata in accordance with their Entitlement, but not to exceed
the number of Shares specified in their respective Acceptances.

         5.4 Loan Finance. Subject to Section 7.4(a), following the subscription
by the Shareholders of all Required Additional Equity Share Capital or otherwise
at any time, the Shareholders may cause the Company to procure that the
requirements of the Company for working capital to finance the Business are met,
as far as reasonably practicable, by borrowings from banks and other similar
sources on the most favorable terms reasonably obtainable as to

                                       13
<PAGE>   17
interest, repayment and security, but without allowing a prospective lender a
right to participate in the Equity Share Capital of the Company as a condition
of a loan.

         5.5 Guarantees Given by Shareholders. Any guarantee or indemnity given
by the Shareholders to secure indebtedness or obligations of the Company for the
purpose of financing the Business shall be approved by the Shareholders as set
forth in Section 7.4(a) and provided by the Shareholders on a several basis in
proportion to their Agreed Proportions from time to time. If any guarantee or
indemnity to be provided by any Shareholder pursuant to this Section 5.5 is not
acceptable to the relevant lender or obligee, then one or more of the remaining
Shareholders may, in their sole discretion, guarantee or indemnify the
unacceptable Shareholder's Agreed Proportion of such guarantee or indemnity as
well as their own on condition that the unacceptable Shareholder shall provide
to the guaranteeing or indemnifying Shareholder a guarantee to pay its Agreed
Proportion of any actual liabilities incurred by such guaranteeing or
indemnifying Shareholder pursuant to the guarantee or indemnity provided by them
in accordance with this Section 5.5.

                                    ARTICLE 6
                    COVENANTS, REPRESENTATIONS AND WARRANTIES

         6.1 Compliance with Applicable Law. Each Shareholder shall comply with
all applicable laws, regulations, rules and orders of governmental authorities
the non-compliance with which could have a material adverse effect on the
business affairs or financial condition of the Company.

         6.2 No Restrictive Covenants. No Shareholder shall enter into or become
subject to any contract, agreement, restriction or covenant which would apply to
the Company so as to impair or inhibit the Company's ability to conduct its
business as contemplated herein or otherwise frustrate the Business of the Joint
Venture.

         6.3 Organization. Each Shareholder represents and warrants that, on and
as of the date of this Joint Venture Agreement, it is duly organized and
existing under the laws of its jurisdiction of organization, that it has the
corporate (or other) power and authority to own, lease and operate its
properties and to carry on its business as now being conducted and as proposed
to be conducted and to perform its obligations under any contracts by which it
is bound, including, without limitation, this Joint Venture Agreement and the
Related Agreements. Each Shareholder has all requisite corporate (or other)
power and authority to enter into this Joint Venture Agreement and the Related
Agreements and to consummate the transactions contemplated hereby and thereby.

         6.4 No Conflict. Except as set forth on Schedule 6.4, subject only to
the approval of the principal terms of this Joint Venture Agreement and the
Related Agreements by each Shareholder's Board of Directors or other governing
body, the execution and delivery of this Joint Venture Agreement by each
Shareholder does not, and as of the Effective Time, the consummation of the
transactions contemplated hereby and by the Related Agreements will not conflict
with, or result in any violation of, or default by such Shareholder under (with
or without

                                       14
<PAGE>   18
notice or lapse of time, or both), or give rise to a right of termination,
cancellation or acceleration of any obligation or loss of any benefit under (a)
any provision of such Shareholders' Memorandum of Incorporation or Bylaws or
other constituent documents, (b) any material contract assigned by or assumed by
the Company from such Shareholder, (c) any instrument, permit, concession,
franchise, license, judgment, order or decree applicable to the Company or its
properties, assets or subsidiaries, or (d) any agreement or governing documents
relating to existing joint venture or other interests to be contributed by a
Shareholder to the Company.

         6.5 Governmental Consents. Each Shareholder represents and warrants
that it will use all commercially reasonable efforts to obtain any and all
approvals or consents of, and to make all notices and filings with, all
governmental authorities necessary for the Shareholders to enter into this Joint
Venture Agreement and for the Company to conduct its Business as contemplated
hereby, including, without limitation:

                  (a) a notice of the intent to enter into the Joint Venture and
                      to form the Company shall have been filed with the
                      appropriate authorized competition authority in the
                      Territory, if applicable;

                  (b) subject to Section 6.11 hereinbelow, export licenses, as
                      required by the United States government;

                  (c) consent of Bermuda Monetary Authority to Share issuance.

If, notwithstanding all commercially reasonable efforts of the Shareholders
hereto, any of such necessary governmental licenses, approvals or consents are
not granted, with the result that the purposes of this Joint Venture Agreement
are substantially frustrated, the Shareholders shall enter into good faith
negotiations with the objective of restructuring the relationship between them
such that the effects of such nonoccurrence shall be minimized.

         6.6 Other Approvals. Each Shareholder represents and warrants that it
will use all commercially reasonable efforts to obtain all other consents and/or
approvals of any third parties necessary for such Shareholder to enter into this
Joint Venture Agreement and for the Company to conduct its Business as
contemplated hereby; provided, that if, notwithstanding the all commercially
reasonable efforts of the Shareholders hereto, any of such consents and/or
approvals are not granted, with the result that the purposes of this Joint
Venture Agreement are substantially frustrated, the Shareholders shall enter
into good faith negotiations with the objective of restructuring the
relationship between them such that the effects of such nonoccurrence shall be
minimized.

         6.7 Litigation. There is no action, suit or proceeding of any nature
pending or, to each Shareholder's knowledge, threatened against such
Shareholder, its properties or any of its officers, directors or employees that
would prohibit, alter or delay the consummation of the transactions contemplated
by this Joint Venture Agreement or which would prohibit or restrict the Business
of the Company as it is currently contemplated to be conducted, nor, to the
knowledge of each Shareholder, is there any reasonable basis therefor. To each
Shareholder's knowledge, there is no investigation pending or threatened against
such Shareholder, its

                                       15
<PAGE>   19
properties or any of its officers, directors or employees by or before any
governmental authority. No governmental authority has at any time challenged or
questioned the legal right of each Shareholder to conduct its operations as
presently or previously conducted.

         6.8 Businesses of Shareholders. Subject to Section 6.9 hereinbelow, any
Shareholder and its respective Affiliates may engage in and/or possess an
interest in other business ventures of any nature and description, independently
or with others; and neither the Company nor the other Shareholders hereto shall
have any right by virtue of this Joint Venture Agreement in or to any such
independent venture or to any income or profits derived therefrom and no
Shareholder or any Affiliate of any Shareholder shall be obligated to present
any particular investment opportunity to the Company even if such opportunity is
of a character that, if presented to the Company, could be taken by the Company,
and each of them shall have the right to take for its own account (individually
or as a trustee) or to recommend to others any such particular investment
opportunity.

         6.9 Exclusivity. Subject to the terms and conditions set forth below in
this Section 6.9 and in Section 6.14, the Company will be the exclusive vehicle
for the Shareholders to pursue the Restricted Business in the Territory. Each of
the Shareholders hereby covenants to and with the other Shareholders that
neither they nor any of their respective Affiliates which they control will do
any one or more of the following:

                  (a) enter into any negotiations, discussions, deliberations,
         agreements or arrangements of any nature whatsoever with any third
         party to either directly or indirectly carry on or be engaged or
         interested in a Restricted Business or be directly or indirectly
         engaged, concerned or interested whether on its own account or as a
         member, shareholder, consultant, agent, beneficiary, trustee or
         otherwise in any enterprise, corporation, firm, trust, joint venture or
         syndicate which is engaged, concerned or interested in or carrying on
         any Restricted Business;

                  (b) on its own account or for any person, enterprise, firm,
         trust, joint venture or syndicate directly or indirectly entice (or
         attempt to entice) away from the Company any Restricted Business of any
         customer of the Company;

                  (c) on its own account or for any person, enterprise, firm,
         trust, joint venture or syndicate directly or indirectly entice (or
         attempt to entice) away from the Company any supplier to the Company to
         the extent related to any Restricted Business;

                  (d) on its own account or for any person, enterprise, firm,
         trust, joint venture or syndicate directly or indirectly entice (or
         attempt to entice) away from the Company any employee, officer, agent
         consultant, advisor, or any individual who is employed by the Company
         in any capacity whatsoever. As used herein, "entice" means contact or
         communicate in any manner whatsoever, including, but not limited to,
         contacts or communications by or through intermediaries, agents,
         contractors, representatives, or other Shareholders, provided, however,
         that nothing herein shall be construed to prohibit the Shareholders
         from (a) placing advertisements for employment which are aimed at the
         public at large in any newspaper, trade magazine, or other periodical
         in general

                                       16
<PAGE>   20
         circulation or advertising for employment through any other mass medium
         such as radio, television or the Internet, (b) responding to any
         unsolicited inquiry by an employee concerning employment or (c)
         employing an employee of the Company after first having obtained the
         approval of the Board which approval, with respect to EXODUS and its
         Affiliates, should be unanimous; or

                  (e) personally or by its employees or agents or by circulars,
         letters or advertisements whether on its own account or for any other
         Person, enterprise, firm, trust, joint venture or syndicate directly or
         indirectly interfere with the Restricted Business of the Company or
         divulge to any Person any information concerning the Restricted
         Business of the Company or the Company or any of its respective
         dealings, transactions or affairs except to the extent it is required
         to do so:

                  (i)      to comply with applicable laws, to defend or
                           prosecute litigation or to comply with government
                           regulations; or

                  (ii)     as part of normal report or review procedure to its
                           parent company, auditors or attorneys.

                  Each Shareholder acknowledges that each of the prohibitions
and restrictions contained in Sections 6.9(a) through (e) are reasonable as to
period, territorial limitations and subject matter in order to protect the
Business and material breach of any of the prohibitions and restrictions
contained herein may not be adequately compensated by an award of damages and
therefore any breach by a Shareholder of any of those prohibitions and
restrictions will entitle any other Shareholder, in addition to any other
remedies available at law or in equity, to seek an injunction to restrain the
committing of any breach (or continuing breach) of any of those prohibitions or
restrictions. Notwithstanding anything to the contrary herein, in the event that
the Hong Kong assets of ASIA GLOBAL CROSSING have not been contributed to the
Company on or prior to the Closing, for so long as such transfer has not been
completed: (i) Hong Kong shall be excluded from the definition of Territory for
purposes of this Section 6.9 as it applies to EXODUS, and (ii) ASIA GLOBAL
CROSSING's ownership of its Hong Kong assets and its compliance with the terms
and conditions under the agreements governing the ownership of such assets shall
be excluded from this Section 6.9 as it applies to ASIA GLOBAL CROSSING. The
provisions of this Section 6.9 shall terminate with respect to any Shareholder
on the date that is the earlier of (x) two (2) years following an underwritten
offering of the Company's securities on a national exchange, (y) the date that
such Shareholder's Joint Venture Interest in the Company is less than ten
percent (10%) of the total outstanding Shares, provided that such reduction in a
Shareholder's Joint Venture Interest in not as a result of such Shareholder's
failure to make any capital contribution duly approved and called for by the
Board and (z) with respect to ASIA GLOBAL CROSSING, only upon the first date
when the Company shall no longer be obligated to purchase network capacity under
the Network Agreement pursuant to the terms thereof. In the event that this
Joint Venture Agreement shall be terminated (other than pursuant to Section
3.3(b) hereto) prior to the second anniversary of the Closing, ASIA GLOBAL
CROSSING shall remain subject to this Section 6.9 until, but not later than, the
second anniversary of the Closing and this Section 6.9 shall survive such
termination to such extent.

                                       17
<PAGE>   21
                  (f) Notwithstanding the provisions of paragraph (a) of this
Section 6.9, EXODUS and ASIA GLOBAL CROSSING, INC. and their respective
Affiliates who they control shall be permitted to:

                           (i) maintain investments existing on the date hereof
         and make investments of ten percent (10%) or less of any class of
         equity securities of any Person directly or indirectly engaged in
         Internet Web-Hosting, provided that neither EXODUS nor ASIA GLOBAL
         CROSSING members participates in the management or control of such
         Person;

                           (ii) acquire securities representing a majority of
         the voting power of a Person whose business includes an Internet
         Web-Hosting business that represents greater than 25% of such Person's
         consolidated revenues for the most recent four calendar quarters,
         provided that the acquiring company divests such Internet Web-Hosting
         business within one year of its acquisition (prior to divesting such
         business, such Shareholder shall provide written notice to the Company
         of the consideration it intends to receive in respect of such
         divestiture and the other relevant principal terms and the Company
         shall, within 15 days of receiving such notice, provide the relevant
         Shareholder with written notice of whether it is interested in
         acquiring such business on such terms, and if the Company is so
         interested, the parties shall in good faith negotiate long form
         definitive documents setting forth the details of such transaction
         within the following thirty (30) days, and if the parties cannot reach
         mutually acceptable terms within such time period the Company shall be
         permitted to sell such business to other parties, provided no such sale
         shall be at a materially lower price or on terms which, in the
         aggregate, are materially less favorable to the Company than those
         offered to such Shareholder);

                           (iii) acquire securities representing a majority of
         the voting power of a Person whose business includes an Internet
         Web-Hosting business that represents less than 25% of such Person's
         consolidated revenues for the most recent four calendar quarters,
         provided that the acquiring company shall, at the time of the
         acquisition, provide written notice of the acquisition to the Company
         and, if the Company is interested in acquiring such business, consider
         any proposal from the Company to purchase such business from the
         acquiring company.

                           (iv) acquire securities representing less than thirty
         percent (30%) of the voting power of a Person whose business includes a
         Restricted Business that represents less than 25% of such Person's
         consolidated revenues for the most recent four calendar quarters,
         provided that neither EXODUS nor ASIA GLOBAL CROSSING members
         participate in the management or control of such Restricted Business;

                           (v) provide, directly or indirectly, services on its
         Dedicated Private Extranet Network including, without limitation, the
         provision of remote access, Internet access and redundancy, in each
         case in connection or associated with providing such services; and

                                       18
<PAGE>   22

                           (vi) without limitation to clause (v) above, continue
         to provide, directly or indirectly, the products and services provided
         at present by IXnet (the parties contemplated that IXnet will be a
         customer of the Company for hosting services).

                  (g) If ASIA GLOBAL CROSSING or EXODUS (the "RELEVANT PARTY")
is acquired by a third party, the provisions of this Section 6.9 shall not
prevent the new parent of the Relevant Party from engaging in, owning, managing,
controlling or participating in the ownership, management or control of entities
engaged in the Restricted Business but all members of the Relevant Party's
Group, excluding the acquiror, will continue to be bound by this Section 6.9,
except as provided in the next sentence. If the Relevant Party is acquired by a
third party and, upon its acquisition by such third party, (i) the Relevant
Party or a member of the Relevant Party's Group is merged with or into the
acquiror or a substantial portion of the Relevant Party's assets are acquired by
the acquiror pursuant to an asset acquisition and such Relevant Party's Group
assets are commingled with those of the acquiror such that the Relevant Party's
Group assets do not remain independently identifiable, and (ii) the acquiror is
materially engaged in the Restricted Business, then the provisions of this
Section 6.9 shall cease to apply to such Relevant Party's Group assets and (iii)
if the Relevant Party is ASIA GLOBAL CROSSING, then EXODUS will have the right
to terminate the Network Agreement effective immediately upon the closing of the
transaction and (iv) if the Relevant Party is EXODUS, then the provisions of
this Section 6.9 will terminate with respect to ASIA GLOBAL CROSSING effective
immediately upon the closing of the transaction.

         6.10 No Encumbrances on Joint Venture Interest. Except as otherwise set
forth on Schedule 6.10 hereto and further subject to the provisions of this
Joint Venture Agreement, no Shareholder shall pledge, mortgage, charge or
otherwise encumber its Joint Venture Interest, including the Shares held by such
Shareholder without the prior written consent of the other Shareholder.

         6.11 Export Assurances. The Company and each of ASIA GLOBAL CROSSING
and EXODUS and each of their respective Affiliates acknowledges and agrees that,
all Technical Data may be subject to export controls imposed by the United
States Export Administration Act of 1979, as amended (the "EXPORT ADMINISTRATION
ACT") or any future United States export control legislation and the regulations
promulgated thereunder. The Company and each of ASIA GLOBAL CROSSING and EXODUS
and their respective Affiliates agrees not to export or re-export, directly or
indirectly, any Technical Data without complying with the Export Administration
Act. The Company and each of ASIA GLOBAL CROSSING and EXODUS certify that
neither the Technical Data nor its direct product: (a) are intended to be used
for any purpose prohibited by the Export Administration Act or regulations
including, without limitation, nuclear related activities or chemical/biological
weapons or missiles; and (b) are intended to be released, shipped or
re-exported, either directly or indirectly, to a national of a country in
Country Groups D:1 (Albania, Armenia, Azerbaijan, Belarus, Bulgaria, Cambodia,
China (PRC), Estonia, Georgia, Kazakhstan, Kyrgyzstan, Laos, Latvia, Lithuania,
Moldova, Mongolia, Romania, Russia, Tajikstan, Turkmenistan, Ukraine, Uzbekistan
and Vietnam) or E:2 (Cuba, North Korea, Libya) or Angola, Iraq, Iran, Sudan or
Syria, or to any other destination to which the United States has prohibited
shipment. This Section 6.11 shall survive any termination or

                                       19
<PAGE>   23
expiration of this Joint Venture Agreement and the Related Agreements. Each
Shareholder acknowledges and agrees that this Section 6.11 is required by the
Export Administration Act and is not intended to, nor does it, modify more
restrictive provisions in this Joint Venture Agreement or the Related Agreements
regarding the use by any Shareholder or the Company of Technical Data.

         6.12 Referral and Solicitation of Additional Customers. Each
Shareholder will refer all inquiries of customers for Services in the Territory
to the Company.

         6.13 No Other Restricted Business Interests in the Territory. Each
Shareholder hereby represents and warrants that, after giving effect to the
transactions contemplated hereby and except as otherwise set forth in Schedule
6.13 hereto, neither it nor any of their respective Affiliates, has any other
interests (equity or voting) in any Person in the Territory engaged in a
Restricted Business and that neither Shareholder nor any of their respective
Affiliates is obligated under any agreement, understanding or other obligation
to enter into, acquire or otherwise hold an interest (equity or voting) in any
Person that is or is contemplated to be engaged in a Restricted Business that
would compete directly or indirectly with the Business of the Company in the
Territory.

         6.14 Combination of Interests.

                  (a) Each Shareholder hereby covenants to use their
         commercially reasonable best efforts to assist the Company in
         effectuating a combination of the business interests in Japan that each
         Shareholder is contributing to the Joint Venture pursuant to this Joint
         Venture Agreement.

                  (b) ASIA GLOBAL CROSSING hereby covenants to use its
         commercially reasonable best efforts to conform the existing
         relationship between ASIA GLOBAL CROSSING and Hutchinson Whampoa with
         respect to the Internet Data Center Services business currently being
         conducted in Hong Kong through their Hutchinson Global Crossing joint
         venture to the provisions herein or as otherwise agreed to that such
         Internet Data Center Services business can be contributed to the Joint
         Venture.

                  (c) In the event that ASIA GLOBAL CROSSING is not able on or
         prior to the Closing to effectuate the transfer of its Hong Kong assets
         as contemplated by this Joint Venture Agreement, then, ASIA GLOBAL
         CROSSING will contribute to the Company an amount equal to the fair
         market value of the Hong Kong assets which shall in no event exceed
         $25,000,000; provided, however, that if at the Closing ASIA GLOBAL
         CROSSING is negotiating in good faith to obtain all consents and/or
         approvals necessary to effectuate such contribution and receipt of such
         consents and approvals is reasonably likely, then EXODUS will extend
         for an additional one-hundred eighty (180) days from the date of
         Closing the period during which the Hong Kong assets are required to be
         transferred to the Company.

                  (d) Each Shareholder hereby agrees that in many countries
         within the Territory it may be desirable or necessary to engage in the
         Business with a local entity

                                       20
<PAGE>   24
         (each such entity, a "LOCAL PARTICIPANT"). Each Shareholder agrees
         that, for each of the following countries, the Joint Venture intends to
         conduct the Business with the Local Participant(s) indicated: Japan
         (Softbank Corp and Internet Research Institute) and Hong Kong
         (Hutchison Whampoa). With respect to other jurisdictions within the
         Territory, EXODUS, in consultation with ASIA GLOBAL CROSSING, shall
         identify each potential Local Participant and, subject to Board
         Approval, shall negotiate the terms and conditions of such Local
         Participant's participation in the Business. EXODUS shall notify the
         Company and ASIA GLOBAL CROSSING promptly upon identifying each
         potential Local Participant and shall maintain a regular and timely
         flow of information regarding the discussions with that potential Local
         Participant to the Company and ASIA GLOBAL CROSSING, including
         providing copies of draft letters of intent, term sheets, joint venture
         agreements and other documents.

         6.15 Enforcement of Rights Under Related Agreements. The Company shall
enforce its rights under each of the Related Agreements as though each such
agreement were a comparable arm's length transaction with an unrelated Person.

         6.16 Tax Election. Each Shareholder hereby covenants and agrees that
with respect to the Company and each Subsidiary of the Company, they shall
mutually determine whether the Company or such Subsidiary shall make a "check
the box" election for tax reporting purposes or other relevant tax matters so as
to maximize the benefits to be received by all Shareholders and each Shareholder
shall execute and file all required documents related to such mutual
determinations.

         6.17 Termination of Existing Joint Venture. At the time of the Closing,
ASIA GLOBAL CROSSING agrees to, and EXODUS agrees to cause Global Center Inc.
to, terminate the existing joint venture agreement between ASIA GLOBAL CROSSING
and Global Center Inc.

                                   ARTICLE 7:
                        CONDUCT OF THE COMPANY'S AFFAIRS

         7.1 Shareholders. The Shareholders shall exercise all voting rights and
other powers available to them in relation to the Company so as to procure
(insofar as they are reasonably able to do so by the exercise of those rights
and powers) that:

                  (a) the business of the Company consists exclusively of the
         Business;

                  (b) the Company complies with the provisions of its Memorandum
         of Association;

                  (c) the Board determines the general policy of the Company
         (subject to the provisions of this Joint Venture Agreement) including
         the scope of the Company's activities and operations, the Board
         reserving to itself and to Shareholders matters involving major or
         unusual decisions as described in Section 7.4 below, subject to the
         applicable law of the Company's jurisdiction of organization.

                                       21
<PAGE>   25
         7.2 Board of Directors. The business, property and affairs of the
Company shall be managed by the Board in accordance with the provisions of this
Joint Venture Agreement, the Memorandum of Association, and all applicable law.
The Board shall use all reasonable efforts to maximize the Company's
profitability.

                  (a) Voting. Each Director shall cast one vote on each
         resolution to be voted upon.

                  (b) Dismissal and Suspension. A Director shall only be
         suspended or dismissed upon the written request of the Shareholder who
         had the authority to nominate such Director for election.

                  (c) Vacancies. A vacancy shall only occur in the event of a
         resignation or a dismissal of a Director, and any vacancy shall be
         filled only by the Shareholder who was entitled to appoint such
         resigning or dismissed Director.

                  (d) Meetings of the Board of Directors. The Shareholders agree
         that:

                           (i)      at least four (4) meetings of the Board will
                                    take place each Fiscal Year;

                           (ii)     additional meetings of the Board will be
                                    convened at the written request of any
                                    Director;

                           (iii)    meetings of the Board will be held at the
                                    principal office of the Company or such
                                    other places as the Chairman of the Board,
                                    after consultation with the rest of the
                                    Board, decides and specifies in the Notice
                                    of such meeting; and

                           (iv)     meetings of the Board may be conducted by
                                    telephonic conference or any similar means
                                    of communication which enables all
                                    participants to hear and be heard.

                  (e) Board Action. Except as otherwise set forth in this Joint
         Venture Agreement, an action or decision of the Board or any committee
         thereof shall require the consent or vote of a simple majority of all
         of the Directors. A majority of the total number of directors (or the
         Directors who are members of a committee) (which majority shall,
         subject to Section 7.2(f), include at least one EXODUS Director and one
         ASIA GLOBAL CROSSING Director) shall be necessary to constitute a
         quorum ("QUORUM") for the transaction of business at any meeting of the
         Board, and except as otherwise provided in this Joint Venture Agreement
         or by the applicable laws of Bermuda, the action of a simple majority
         of Directors (or the Directors who are members of a committee) present
         at any meeting at which there is a Quorum, when duly assembled, is
         valid. A meeting at which a Quorum is initially present may continue to
         transact business, notwithstanding the withdrawal of directors, if any
         action taken is approved by

                                       22
<PAGE>   26
         a majority of the required Quorum for such meeting. No Shareholder,
         acting in its capacity as a Shareholder, shall have the authority to
         act for and bind the Company unless such matter has been approved by
         the Board as set forth herein.

                  (f) Notice of Meetings. Notices of meetings of the Board (or
         any committee thereof), including the time and place of any proposed
         meeting and a proposed agenda for such meeting, shall be delivered
         personally to each of the Directors (or the Directors who are members
         of a committee) or personally communicated to them by an officer of the
         Company by telephone and confirmed in writing by facsimile, or
         communicated by overnight courier service (receipt requested) at least
         thirty (30) days in advance of such proposed meeting, unless waived by
         each of the Directors (or the Directors who are members of a
         committee). Notice shall be transmitted to the last known facsimile
         number or address of the Director as shown on the records of the
         Company. Such notice as above provided shall be considered due, legal
         and personal notice to such Director. If at any meeting of the Board
         (or any committee thereof) that has been duly called or noticed, at
         least one Director appointed by each Shareholder is not present, such
         meeting shall be adjourned and reconvened in two (2) business days,
         unless such adjournment has been waived by all of the Directors
         (whether or not present at the meeting). Notice of the revised meeting
         date shall be given to each director pursuant to the foregoing
         provisions excluding the number of days of advance notice.
         Notwithstanding the provisions of the second sentence of Section 7.2(e)
         above, in the event that at least one Director appointed by each
         Shareholder is not present at such reconvened meeting, such meeting
         shall be deemed to have a Quorum if a majority of the total number of
         Directors is present. Meetings of the Board (or any committee thereof)
         shall be delayed only once for lack of participation of the Directors
         appointed by any Shareholder. With respect to a meeting which has not
         been duly called or noticed pursuant to the foregoing provisions, all
         transactions carried out at the meeting are as valid as if they had
         been carried out at a meeting regularly called and noticed if: (i) all
         Directors are present at the meeting, and sign a written consent to the
         holding of such meeting, (ii) a majority of the Directors are present
         and if those not present sign a waiver of notice of such meeting or a
         consent to holding the meeting or an approval of the minutes thereof,
         whether prior to or after the holding of such meeting, which waiver,
         consent or approval shall be filed with the other records of the
         Company, or (iii) all Directors attend a meeting without notice and do
         not protest prior to the meeting or at its commencement that notice was
         not given to them.

                  (g) Action by Unanimous Written Consent. Any action required
         or permitted to be taken by the Directors may be taken without a
         meeting and will have the same force and effect as if taken by a vote
         of Directors at a meeting properly called and noticed, if authorized by
         a writing signed individually or collectively by all, but not less than
         all, the Directors. Such consent shall be filed with the records of the
         Company.

                  (h) Compensation and Reimbursement of Directors. The Directors
         shall be reimbursed by the Company for any expenses reasonably incurred
         in connection with their services as Directors.

                                       23
<PAGE>   27
                  (i) Any Director may participate in any meeting of the Board
         (or any committee thereof) telephonically or by any other electronic
         audio or video means.

         7.3 Appointment of Staff. The Company shall employ such staff as the
Board considers necessary for the proper conduct of its Business. The Chief
Executive Officer can appoint and shall use all reasonable endeavors to ensure
that the appointees have experience and qualifications which are commensurate
with the relevant appointment and dismiss employees in accordance with the
provisions of this Joint Venture Agreement and the Memorandum of Association and
any applicable laws of the Territory and can grant such employees any and all
titles (e.g., Vice-Chief Executive Officer or Secretary).

         7.4. Required Shareholder Approvals.

                  (a) Actions Requiring Unanimous Approval of Shareholders.
         During the term of this Joint Venture Agreement, the Company shall not,
         and shall not permit any of its Subsidiaries, to take or cause to be
         taken any of the following actions without the unanimous approval of
         the Shareholders:

                           (i)      (A) Any merger or consolidation, or (B) any
                                    divestiture, joint venture, partnership,
                                    acquisition or other business combination
                                    with, by or of the Company into or with any
                                    other Person ("BUSINESS COMBINATION") in
                                    which the aggregate consideration for all
                                    such transactions occurring in a year if
                                    occurring during the first two (2) years of
                                    this Joint Venture Agreement exceeds
                                    $100,000,000, or thereafter, if such
                                    transaction exceeds the greater of
                                    $100,000,000 and fifteen percent of the fair
                                    market value of the Company as determined in
                                    accordance with Article 14.

                           (ii)     Any proposed dissolution or liquidation of
                                    the Company or application for bankruptcy of
                                    the Company, winding up or the taking of any
                                    action for the appointment of a liquidator
                                    receiver or receiver and manager; or

                           (iii)    Any dividend, distribution, redemption or
                                    repurchase of Shares; or

                           (iv)     Any issuance of any Shares to any Person
                                    other than the existing Shareholder or any
                                    obligation convertible into shares or the
                                    grant of any warrant, option or right to
                                    acquire any of the foregoing other than
                                    pursuant to an employee incentivization
                                    scheme approved by the Board; or

                           (v)      Any expansion of the scope of the Business;
                                    or

                           (vi)     Any amendment to the Memorandum of
                                    Association; or

                           (vii)    Any increase or decrease in the number of
                                    appointed Directors; or

                                       24
<PAGE>   28
                           (viii)   Any material amendment to any of the Related
                                    Agreements; or

                           (ix)     Any determination by the Board to call for
                                    the subscription of Shares in excess of one
                                    hundred twenty five percent (125%) of the
                                    amounts set forth in Section 5.1 with
                                    respect to the periods set forth therein;

                           (x)      Any change in the accounting policies upon
                                    which the Company prepares its books,
                                    records and accounts; or

                           (xi)     Any related party transactions (other than
                                    this Joint Venture Agreement and the Related
                                    Agreements) having a dollar value that
                                    exceeds five million dollars (U.S.
                                    $5,000,000) or meeting any of the following
                                    criteria: (i) is not arms length, or (ii)
                                    has no legitimate business purpose or; or

                           (xii)    Incur indebtedness such that the Company's
                                    total consolidated indebtedness does not
                                    exceed the greater of (i) $100,000,000 or
                                    (ii) four (4) times the Company's
                                    consolidated earnings for the prior four
                                    fiscal quarters calculated before deducting
                                    expenses of interest, taxes, depreciation
                                    and amortization.

                  (b) Other Shareholder Action. Subject to the other terms of
         this Joint Venture Agreement, all other actions of the Shareholders
         required pursuant to applicable provisions of the law of the Company's
         jurisdiction of organization or the Company's Memorandum of Association
         shall be approved by a simple majority vote at a duly constituted
         meeting of Shareholders with each Shareholder entitled to one vote per
         Share held of record as of the record date for such meeting.

         7.5 Accounting and Internal Controls.

                  (a) Maintenance of Accounting Records. The Company will
         conduct its business at all times in accordance with high standards of
         business ethics and maintain full and accurate books, records and
         accounts which will, in reasonable detail, accurately and fairly
         reflect all transactions of the Company in accordance with generally
         accepted accounting principles, procedures and practices in the United
         States which have been consistently applied.

                  (b) US GAAP. The Company must ensure that a set of the
         Company's annual and quarterly accounts, based on a calendar fiscal
         year, is prepared in English and audited in accordance with U.S.
         Generally Accepted Accounting Practices.

                  (c) Reports The Chief Executive Officer must provide the Board
         and the Shareholders with sufficient management and financial
         information and reports to allow the Board and the Shareholders to
         monitor the conduct the Business

                                       25
<PAGE>   29
                  (d) Appointment of Independent Auditor. Initially, the Board
         of Directors shall appoint KPMG as the independent auditor of the
         Company, which auditors shall examine and audit the financial accounts
         of the Company and report the results to the Board.

                  (e) Approval of Annual Accounts. The authority to approve the
         annual accounts of the Company lies with the Shareholders.

         7.6 Bank Accounts. Company funds shall be deposited in the name, and
for the sole benefit, of the Company in such bank or savings and loan accounts
of the Company as may be designated by the Board. The Board of Directors shall
arrange for the appropriate conduct of those accounts and shall make
disbursements solely for the business of the Company or for distributions to the
Shareholders in accordance with this Joint Venture Agreement. Any security
deposits shall be maintained in a segregated interest bearing account and shall
be distributed pursuant to the agreement under which the deposit is received.

         7.7 Transactions with Affiliates.

                  (a) General. Subject to Section 7.4(a), the Chief Executive
         Officer and the Board of Directors may cause the Company to transact
         business with any Shareholder or any Affiliate of any Shareholder for
         the performance of services or purchase of goods or other property that
         may at any time be reasonably required in carrying on the business of
         the Company; except that the compensation or price therefor shall not
         exceed that prevailing in arm's length transactions and shall be on
         such standard commercial terms as are offered by other third parties
         rendering similar quality goods or services on comparable transactions
         as an on-going activity in the same geographical area.

                  (b) Related Agreements. Notwithstanding the provisions of
         Sections 7.4 and 7.7(a), each Shareholder acknowledges that the Company
         shall enter into and be bound by each of the Licensing Agreement, the
         Network Agreements and the Services Agreement at or prior to the
         Effective Time.

         7.8 Organization. The parties hereto shall mutually agree upon the
organizational structure of the Company

                                   ARTICLE 8:
                               DISPUTE RESOLUTION

         8.1 Negotiation Between Executives. Each of the Shareholders and the
Company shall attempt in good faith to resolve any dispute arising out of or
relating to the interpretation, breach or termination of this Joint Venture
Agreement (a "DISPUTE") promptly by negotiations between the Chief Executive
Officers of EXODUS and ASIA GLOBAL CROSSING. For the purpose of this Joint
Venture Agreement, the term "Dispute" does not include any disputes or
controversies resulting from, arising out of or with respect to any of the
Related Agreements, unless otherwise provided in any of the Related Agreements.
Any Shareholder or the Company

                                       26
<PAGE>   30
who is a party to a Dispute shall give the other Shareholders and the Company
written notice of any Dispute not resolved in the normal course of business.
Within twenty (20) days after delivery of such a notice, executives of all
Shareholders involved in the Dispute, and the Company, shall meet at a mutually
acceptable time and place, and thereafter as often as they reasonably deem
necessary, to attempt to resolve the Dispute. All negotiations pursuant to this
Section 8.1 shall be confidential.

         8.2 Arbitration. In the event that any Dispute cannot be resolved
thereby within a period of thirty (30) days after delivery of such notice has
been given, such Dispute shall be settled finally by arbitration in San Jose,
California, using the English language and in accordance with the rules then in
effect of the American Arbitration Association. The arbitrator(s), who shall be
experienced in the matters that are the subject of the Dispute or fundamental to
understanding the nature of the dispute, shall have the authority to grant
specific performance, and to allocate between the parties the costs of
arbitration in such equitable manner as the arbitrator(s) may determine. The
prevailing Shareholder in the arbitration shall be entitled to receive
reimbursement of its reasonable expenses incurred in connection therewith,
including the costs of travel to, and meals and hotel accommodation in, the
location of such proceedings. Judgment upon the award so rendered may be entered
in any court having jurisdiction or application may be made to such court for
judicial acceptance of any award and an order of enforcement, as the case may
be.

         8.3 Irreparable Harm. The Shareholders hereby reserve their right to
seek immediate injunctive relief in the event of the breach of any provision of
this Joint Venture Agreement where such breach may cause irreparable harm, the
extent of which would be difficult to ascertain. Accordingly, they agree that,
in addition to any other legal remedies to which a non-breaching Shareholder
might be entitled, such Shareholder may seek immediate injunctive relief in the
event of any breach of any of the provisions of this Joint Venture Agreement
either through arbitration or through the courts.

                                   ARTICLE 9:
                     INDEMNIFICATION; LIMITATION ON DAMAGES,
                         CONTRACTUAL LIMITATIONS PERIOD

         9.1 Indemnification.

                  (a) From and after the Closing, each Shareholder shall
         indemnify and hold harmless, the Company and each other Shareholder and
         any Subsidiary of the Company (the "INDEMNITEES") from any liability
         for, or arising out of or based on, or relating to,

                           (i) any Tax (i) of such Shareholder or any Subsidiary
                  of such Shareholder (other than the Company and its
                  Subsidiaries for any period beginning after the Closing date)
                  or (ii) relating to the income, business, assets, property or
                  operation of the Contributed Assets of such Shareholder, prior
                  to and on the date of Closing and with respect to any
                  Contributed Assets, the date on which the contribution of such
                  Contributed Asset is effected to the Company.

                                       27
<PAGE>   31
                           (ii) any and all Losses incurred or suffered by an
                  Indemnitee, arising out of, based on or resulting from the
                  ownership and/or operation of the Contributed Assets prior to
                  and on the date which the contribution of such Contributed
                  Asset is effected to the Company.

                  (b) An Indemnitee shall notify the indemnifying Shareholder of
         any claim for Tax or Losses in writing, and in reasonable detail, as
         promptly as reasonably possible after receipt by such Indemnitee of
         notice of such claim; provided, however, that failure to give such
         notification on a timely basis shall not affect the indemnification
         provided hereunder except to the extent that such Indemnifying
         Shareholder shall have been actually materially prejudiced as a result
         of such failure. Thereafter, the Indemnitee shall promptly deliver to
         the Indemnifying Shareholder copies of all notices and documents
         received by the Indemnitee relating to such claim.

                  (c) If a Tax Indemnitee receives a refund or credit of Taxes
         for which it has been indemnified pursuant to this Section 9.1 such Tax
         Indemnitee agrees to pay the indemnifying Shareholder the amount of
         such refund or credit (including any interest received thereon).

         9.2 Limitation on Damages.

                  (a) No Shareholder shall be liable for any indirect, special,
         incidental or consequential loss or damage (including, without
         limitation, loss of profits or loss of use) suffered by any other
         Shareholder arising from or relating to a Shareholder's performance,
         non-performance, breach of or default under a covenant, warranty,
         representation, term or condition hereof; each Shareholder, other than
         with respect to a claim arising from such other Shareholder's gross
         negligence, willful misconduct or fraudulent actions, waives and
         relinquishes claims for indirect, special, incidental or consequential
         damages.

                  (b) The limitations on liability and damages set out in
         Section 9.2(a) apply to all causes of action that may be asserted
         hereunder, other than a cause of action resulting from another
         Shareholder's grossly negligent, willful misconduct or fraudulent
         actions, whether sounding in breach of contract, breach of warranty,
         tort, product liability, negligence or otherwise.

         9.3 Contractual Limitation Period. Any arbitration, litigation,
judicial reference or other legal proceeding involving the parties shall be
commenced within three (3) years after the accrual of the cause of action.

                                   ARTICLE 10:
                 CONFIDENTIAL INFORMATION; PUBLIC ANNOUNCEMENTS

         10.1 Treatment of Confidential Information. Confidential Information
will be kept confidential and shall not be disclosed, in whole or in part, to
any Person other than Affiliates,

                                       28
<PAGE>   32
officers, directors, employees, agents or representatives of the Company or of a
Shareholder or the Company's or such Shareholder's legal counsel or independent
auditors, or prospective lenders to the Company or either Shareholder
(collectively, "REPRESENTATIVES") who need to know such Confidential Information
for the purpose of negotiating, executing and implementing this Joint Venture
Agreement and the transactions contemplated hereby. The Company and each
Shareholder agrees to inform each of its Representatives of the non-public
nature of the Confidential Information and to direct such Persons to treat such
Confidential Information in accordance with the terms of this Section. The
Company and each Shareholder agrees to be liable for any breach of the terms
hereof by its Representatives. Nothing herein shall prevent the Company or
either Shareholder from disclosing confidential Information (i) upon the order
of any court or administrative agency, (ii) as required by law or upon the
request or demand of, or pursuant to any regulation of, any regulatory agency or
authority, (iii) to the extent reasonably required in connection with the
exercise of any remedy hereunder, and/or (iv) to any actual or proposed
permitted assignee of all or part of its rights hereunder provided that such
actual or proposed assignee agrees in writing to be bound by the provisions of
this Section. Notwithstanding the foregoing, in the event that the Company or
any shareholder intends to disclose any Confidential Information pursuant to
clause (i) or (ii) of the preceding sentence, such Person agrees to (x) provide
the other parties hereto with prompt notice before such disclosure in order that
such parties may attempt to obtain a protective order or other assurance that
confidential treatment will be accorded such Confidential Information and (y)
cooperate with such parties in attempting to obtain such order or assurance. The
Company and each Shareholder agrees that it will maintain all Confidential
information disclosed to it in strict confidence and will take all reasonable
measures to maintain the confidentiality of all such Confidential Information in
its possession or control, but in no event less than the measures it uses to
maintain the confidentiality of its own information of similar importance. The
provisions of this Article 10 will survive termination of this Joint Venture
Agreement.

         10.2 Company Employees. The Company shall require each of its employees
to sign written undertakings or agreements with the Company not to disclose any
Confidential Information.

         10.3 Public Announcements. No Shareholder shall be entitled to make or
permit or authorize the making of any press release or other public statement or
disclosure concerning this Joint Venture Agreement, a Related Agreement or any
of the transactions contemplated herein without the prior written consent of the
other Shareholder except as otherwise may be required by law or the rules of a
stock exchange relevant to that Shareholder or its Affiliates and then only upon
the advise of such Shareholder's legal counsel.

                                   ARTICLE 11:
           TRANSFERS OF INTERESTS AND ISSUANCE OF ADDITIONAL INTERESTS

         11.1 Disposition of a Shareholder's Joint Venture Interest.

                                       29
<PAGE>   33
                  (a) General. Subject to Sections 11.2, 11.3, 11.4, 11.7 11.8,
         11.9, 11.10 and 11.12 hereinbelow, no Shareholder may make any
         Disposition of all or any part of its Joint Venture Interest or Shares,
         in any manner, whether voluntarily or involuntarily, by operation of
         law or otherwise, to any person. Any transfer not in accordance with
         this Article 11 and the Memorandum of Association and applicable
         provisions of the law of the Company's jurisdiction of organization
         will be voidable at the option of any of the non-transferring
         Shareholders or the Company.

                  (b) Transfers Prohibited During First Five (5) Years. Subject
         to Section 11.7 hereinbelow, each of the Shareholders agrees not to
         make any Disposition during the first Five (5) years following the
         Effective Time, unless otherwise unanimously approved by the Board
         (other than the directors nominated by the Shareholder which proposes
         to make the Disposition).

         11.2 Right of First Refusal. Subject to the provisions of Sections 11.3
and 11.7 below, in the event that a Shareholder desires to Dispose of all or any
part of its Joint Venture Interest (a "SELLING SHAREHOLDER") to a third party
the non-selling Shareholders will have a right of first refusal ("RIGHT OF FIRST
REFUSAL") in accordance with their Agreed Proportions on all sales of all or any
part of the Selling Shareholder's Joint Venture Interest. The Selling
Shareholder shall first provide to the non-selling Shareholders a written notice
of proposed sale ("NOTICE OF PROPOSED SALE") which shall specify the terms and
conditions for such sale (excluding any terms which are not reasonably capable
of acceptance or performance by the non-selling Shareholder) including the
portion of such Selling Shareholder's Joint Venture Interest proposed to be sold
and the price therefor and the identity of the Purchaser. The non-selling
Shareholder(s) shall then have thirty (30) calendar days from the date of such
Notice of Proposed Sale ("ACCEPTANCE PERIOD") in which to elect to purchase such
Selling Shareholder's Joint Venture Interest on the same terms and conditions as
specified in such Notice of Proposed Sale by providing the Selling Shareholder
written notice of its acceptance of such offer to purchase. If any component of
the price specified in the Notice of Proposed Sale includes the issuance of a
third party's securities, a non-selling Shareholder will be deemed to have
accepted the terms of such Notice of Proposed Sale if it agrees to pay the fair
market value of such securities. If such securities are traded on a nationally
recognized securities exchange, the fair market value of such securities
component shall be the closing price of such securities on the date of such
Notice of Proposed Sale or if not so traded, the fair market value of such
securities will be determined by an Independent Valuer in accordance with
Article 14. If the non-selling Shareholder(s) have not given notice to the
Selling Shareholder of their agreement to purchase the Selling Shareholder's
Joint Venture Interest within the Acceptance Period prescribed above, then the
Selling Shareholder shall be free to consummate the sale of its Joint Venture
Interest within sixty (60) days on such terms and conditions that are no less
favorable to the Selling Shareholder than the terms and conditions specified in
such Notice of Proposed Sale. If such sale is not consummated within such sixty
(60) day period immediately following the Acceptance Period, then any sale of
such Selling Shareholder's Joint Venture Interest must comply with the
provisions of this Section 11.2 and a new Notice of Proposed Sale shall be
provided to the non selling Shareholder(s).

                                       30
<PAGE>   34
         11.3 Assignment to Affiliate. Notwithstanding anything to the contrary
stated herein, a Shareholder's Joint Venture Interest or any rights or
obligations of such Shareholder hereunder may be assigned to any Affiliate of
such Shareholder who becomes a party to this Joint Venture Agreement pursuant to
Section 11.7; provided, that the assigning Shareholder shall remain liable as
the primary obligor of such Shareholder's obligations under this Joint Venture
Agreement and subject to the provisions of Sections 6.9 and 6.13 and upon the
reasonable request of the Board of Directors such Shareholder shall execute any
and all documentation deemed reasonable and desirable to effectuate such
continuing obligation; provided, further, that in the event that any such
assignee shall cease to be a Affiliate of the assigning party, such assignee
shall promptly assign such Joint Venture Interest or rights or obligations
hereunder back to the original assignor. Notwithstanding the foregoing, a
Shareholder may be released in whole or in part from its obligations under this
Joint Venture Agreement in connection with any such assignment upon the
unanimous approval of the remaining Shareholders.

         11.4 Deemed Offer of Shares Upon Buy-Out Event. Upon the occurrence of
a Buy-Out Event, the Shares of the Shareholder with respect to whom a Buy-Out
Event occurs (the "TRANSFERRING SHAREHOLDER") are deemed to be offered for
transfer to (i) the other Shareholders, and (ii) the Company, on the terms and
conditions set out in Section 11.5 in due accordance with the provisions of the
Memorandum of Association, subject to the following:

                  (a) Priority of Purchase Right. The Shareholders shall have
         priority over the Company in the exercise of their right to purchase
         Shares following a Buy-Out Event. The Shareholders shall notify the
         Company within 30 days of their being informed of the occurrence of the
         Buy Out Event and the purchase consideration for the Shares. If more
         than one Shareholder offers to purchase the Shares subject to the
         Buy-Out Event, the Shares to be acquired from the Transferring
         Shareholder shall be apportioned between the purchasers pro-rata
         according to their respective Agreed Proportions.

                  (b) No Purchase Effected. Subject to sub-section (c) below, if
         the Shares so offered, or any portion thereof, are not purchased by the
         other Shareholders or the Company, the Transferring Shareholder may
         retain its Shares.

                  (c) Retention of Shares. In the event that a Transferring
         Shareholder elects to retain its Joint Venture Interest following the
         occurrence of a Buy-Out Event the following terms and conditions shall
         apply:

                           (i)      such Transferring Shareholder shall
                                    voluntarily relinquish its rights to make
                                    nominations for the appointment of Directors
                                    of the Company under Article 12 and/or the
                                    Chief Executive Officer under Section 4.3,
                                    as applicable as well as relinquish its
                                    rights for Required Shareholder Approvals
                                    under Section 7.4; and

                           (ii)     such Transferring Shareholder shall take all
                                    actions and execute all such documentation
                                    as is deemed necessary or desirable by the
                                    Board of Directors to relinquish such power,
                                    including, but not limited to entering into
                                    a voting agreement in which such

                                       31
<PAGE>   35
                                    Transferring Shareholder agrees to vote in
                                    favor of the dismissal of those members of
                                    the Board of Directors that were appointed
                                    upon the nomination of such Transferring
                                    Shareholder.

         11.5 Terms of Contract The terms of a contract arising under Section
11.4 are as follows:

                  (a) the purchase consideration is the fair market value of the
         Shares of the Transferring Shareholder as agreed between the
         Shareholders within thirty (30) days of the Buy-Out Event or, failing
         agreement between the Shareholders, determined by the Independent
         Valuer in accordance with Article 14;

                  (b) the Transferring Shareholder warrants that:

                           (i)      it has, or on the date of completion of the
                                    sale and purchase will have, a clear and
                                    unencumbered title to each of the Shares the
                                    subject matter of the sale and purchase; and

                           (ii)     each of the Shares the subject matter of the
                                    sale and purchase is sold free from any
                                    encumbrance and shall be transferred with
                                    all rights and obligations appurtenant
                                    thereto;

                  (c) the Transferring Shareholder must pay any stamp duty or
         other transfer taxes payable on transfer of the Transferring
         Shareholder's Shares;

                  (d) completion is subject to, and conditional upon, any
         necessary regulatory approvals (which the Transferring Shareholder and
         the purchasing Shareholder(s) undertake to use all reasonable efforts
         to obtain);

                  (e) subject to satisfaction of any condition precedent
         referred to Section 11.5(d) completion must occur within ten (10) days
         after the Independent Valuer has determined the fair market value of
         the Transferring Shareholder's Shares; and

                  (f) at completion, the Transferring Shareholder must tender to
         the other Shareholder(s) against a bank check for the purchase
         consideration calculated in accordance with Section 11.5(a):

                           (i)      in respect of all the Transferring
                                    Shareholder's Shares, the share certificates
                                    and duly executed instruments of transfer in
                                    registrable form naming as transferee the
                                    other Shareholder(s) or its nominee(s), as
                                    applicable;

                           (ii)     the written resignations of each Director
                                    appointed by the Transferring Shareholder;
                                    and

                                       32
<PAGE>   36
                           (iii)    any other document which the other
                                    Shareholder(s) require to obtain good title
                                    to the Shares and to enable the other
                                    Shareholder(s) to procure the registration
                                    of the Shares in its name or the names of
                                    its nominee(s), as applicable.

         11.6 Attorney. Each Shareholder irrevocably appoints every Director
from time to time, jointly and severally, as its attorney and attorneys, on its
behalf and in its name to transfer its Shares in accordance with Section 11.5 to
execute under hand or under seal and deliver (conditionally or unconditionally)
in any place that the attorney chooses any instrument of transfer in respect of
those Shares and any other documents that in the opinion of the attorney are
necessary to carry out any of the provisions of Section 11.5.

         11.7 Deed of Ratification and Accession. The Shareholders must procure
that the Board of Directors does not register a person (who at the time of
registration is not a Shareholder) as a Shareholder whether pursuant to:

                  (a) an issue of additional Shares;

                  (b) a transfer of Shares; or

                  (c) otherwise,

unless that person has first entered into a deed of ratification and accession
agreeing to be bound by the terms and conditions of this Joint Venture Agreement
as a Shareholder of the Company.

         11.8 Issuance of Additional Shares.

                  (a) Generally. Subject to required Board and Shareholder
         approvals, the Company may from time to time offer and issue additional
         Shares to any person in such amounts, on such terms and conditions and
         for such consideration as the Company's Board from time to time may
         determine; provided, that prior to the issuance of any Shares to any
         such person, such person shall first have executed a deed of
         ratification and accession and become a party to this Joint Venture
         Agreement unless otherwise unanimously agreed by the Board.

                  (b) Employee Share Ownership. Subject to Board approval, the
         Shareholders agree to consider the adoption of an employee incentive
         stock option scheme, pursuant to the provisions of the applicable law
         of the Company's jurisdiction of organization or in the alternative the
         Board may approve a warrant type stock option plan. In such case, each
         of the Shareholders of the Company shall be diluted proportionately.

         11.9 Failure to Make Capital Contributions. In the event that any
Shareholder shall fail to pay within thirty (30) days following the date due any
of (i) its Initial Capital Contribution pursuant to Section 3.1, or (ii) any
Required Additional Capital Contributions or Further Contributions under
Sections 5.1 or 5.3, respectively (such Shareholder, a "DEFAULTING

                                       33
<PAGE>   37
SHAREHOLDER") then, EXODUS in the case of ASIA GLOBAL CROSSING and ASIA GLOBAL
CROSSING in the case of EXODUS, shall have the right, which right shall be the
exclusive remedy of such Shareholder hereunder to elect to: (i) exclude the
Defaulting Shareholder(s) from making any further Required Equity Capital
Contributions pursuant to Section 5.1 or otherwise and such Defaulting
Shareholder(s)' interests shall be diluted accordingly upon any further capital
contributions made to the Company by the remaining non-Defaulting
Shareholder(s), and, (ii) solely in the event such failure results in a material
adverse effect upon the Company, approve those items otherwise requiring
unanimous approval of the Shareholders specified in Section 7.4(a) shall be
approved by a simple majority vote of the Company's Board.

         11.10 Tag-Along Rights.

                  (a) Subject to Section 11.10(e), in the event that any
         Shareholder (the "SELLER") proposes to Dispose of any Shares then
         collectively held by it and its Affiliates, other than to an Affiliate
         in accordance with Section 11.3, then each other Shareholder shall have
         the right (the "TAG-ALONG RIGHT") to require the proposed purchaser to
         purchase from such other Shareholder up to the number of whole Shares
         not to exceed the number derived from the following formula:

                  N x TS  =  Tag
                      S

                  where

                  N   =   total number of Shares owned by such other Shareholder

                  TS  =   total number of Shares proposed to be Disposed of by
                          the Seller

                  S   =   total number of Shares owned by the Seller immediately
                          prior to the Disposition

                  Tag =   number of Shares in respect of which such other
                          Shareholder may exercise Tag-Along Rights.

        Any Shares purchased from the other Shareholders pursuant to this
        Section 11.10 shall be paid for in the same consideration received by
        the Seller at the same price per Share and upon the same terms and
        conditions as the proposed Disposition by the Seller; provided, however,
        that in no event shall such other Shareholder be required to make any
        representations or provide any indemnities with respect to matters
        relating solely to the Seller.

                  (b) The Tag-Along Right may be exercised by the other
        Shareholders by delivery of a written notice to the Seller (the
        "TAG-ALONG NOTICE") within fifteen (15) days following delivery of the
        Notice of Proposed Sale by the Seller. The Tag-Along Notice shall state
        the amount of Shares that such other Shareholder proposes to include in
        such Disposition to the proposed purchaser (not to exceed the number
        determined as aforesaid).

                                       34
<PAGE>   38
         If a Shareholder has not so delivered a Tag-Along Notice as set forth
         above it shall be deemed to have waived all of its rights with respect
         to participating in the Transfer, and the Seller shall thereafter be
         free (subject to Section 11.9(d)) to sell to the proposed purchaser, at
         a price no greater than the price for such Shares set forth in the
         Tag-along Notice and on other principal terms which are not more
         favorable to the Seller than those set forth in the Notice of Proposed
         Sale, without any further obligation to such other Shareholder. If,
         prior to consummation, the terms of such proposed Disposition shall
         change with the result that the price shall be greater than the Share
         price for such Shares set forth in the Notice of Proposed Sale or the
         other principal terms shall be substantially more favorable to the
         Seller than those set forth in the Notice of Proposed Sale, it shall be
         necessary for a separate Notice of Proposed Sale to be furnished, and
         the terms and provisions of this Section 11.10 separately complied
         with, in order to consummate such proposed Disposition pursuant to this
         Section 11.10.

                  (c) The acceptance of any other Shareholders shall be
        irrevocable except as hereinafter provided, and each accepting
        Shareholder shall be severally bound and obligated to sell in the
        Disposition on the same terms and conditions with respect to each Share
        sold as the Seller, such number of Shares as such other Shareholders
        shall have specified in such Tag-Along Notice; provided, however, that
        in the event there is any change in the price or terms of the proposed
        Disposition, the Seller shall notify the other Shareholders of such
        changes and such other Shareholder have the right to withdraw its
        Tag-Along Notice, in whole or in part. In the event the Seller shall be
        unable to obtain the inclusion in the Disposition of the entire number
        of Shares which the Seller and the other Shareholders desire to have
        included in the Disposition (as evidenced in the case of the Seller by
        the Sale Notice and in the case of the other Shareholders by the
        Tag-along Notice), the number of Shares to be sold in the Disposition by
        each of the Seller and the Other Shareholders shall be reduced on a pro
        rata basis in accordance with their respective Agreed Proportions.

                  (d) If at the end of the 120th day following the date of the
        delivery of the Sale Notice the Seller has not completed the Disposition
        (other than as a result of a breach of this Agreement by such other
        Shareholders), such other Shareholders shall be released from their
        obligations under their Tag-along Notice, the Sale Notice shall be null
        and void, and it shall be necessary for a separate Sale Notice to be
        furnished, and the terms and provisions of this Section 11.10 separately
        complied with, in order to consummate such Transfer pursuant to this
        Section 11.10.

                  (e) The exercise or non-exercise of the rights of any
        Shareholder to participate in one or more Dispositions of Shares shall
        not adversely affect such Shareholder's right to participate in
        subsequent Dispositions of Shares.

         11.11 Termination of Restrictions on Transfer. The provisions of this
Article 11 restricting a Shareholder's ability to transfer its Shares shall
expire and be of no further force and effect upon the consummation of an
underwritten initial public offering of the Shares of the

                                       35
<PAGE>   39
Company approved by the Company's Board of Directors in which the Company shall
receive cash proceeds of not less than $35 Million (net of underwriting
discounts and commissions.).

         11.12 Mandatory Initial Public Offering; Registration Rights. Unless a
Qualified Initial Public Offering shall previously have been consummated, upon
receipt of a written request by ASIA GLOBAL CROSSING at any time on or after the
third anniversary of the Closing, the Company shall consummate as soon as
practicable a Qualified Initial Public Offering; provided, however, that such
offering may be delayed for up to one year if such delay is reasonably prudent
as a result of market conditions at such time. In connection with the
consummation of such Qualified Initial Public Offering, the Company shall agree
to provide customary "venture capital" registration rights to ASIA GLOBAL
CROSSING and EXODUS. For purposes of this Agreement, a "QUALIFIED INITIAL PUBLIC
OFFERING" shall mean an underwritten, firm commitment public offering of the
Shares in the United States that results in the receipt by the Company of cash
proceeds of at least $35 million (net of underwriting discounts and
commissions).

                                   ARTICLE 12:
                                VOTING AGREEMENT

         12.1 Election, Suspension and Dismissal of Directors; Election of Chief
Executive Officer. The Shareholders hereby acknowledge and agree to vote to
elect at any general or special meeting of Shareholders considering such matter
as Directors of the Company those nominees designated by EXODUS (4) and ASIA
GLOBAL CROSSING (2), as provided herein and to elect the Chief Executive Officer
as designated pursuant to Section 4.3. Further, the Shareholders hereby agree to
vote in favor of any resolution for the suspension or dismissal of a Director
made subject to a vote of any general or special meeting of Shareholders in
accordance with Section 7.2(b) hereof.

         12.2 Dissolution of the Company. In the event of the serving of a
Termination Notice or an EXODUS Termination Notice pursuant to 3.3(d),
respectively, the Shareholders agree to adopt and approve a resolution for the
dissolution and winding up of the Company pursuant to Article 13.

                                   ARTICLE 13:
                           DISSOLUTION AND WINDING UP

         The Company shall be dissolved and wound up upon the resolution of the
Shareholders pursuant to Section 7.4 pursuant to a proposal approved and
unanimously adopted by the Board of Directors or upon the serving of a
Termination Notice or EXODUS Termination Notice pursuant to Section 3.3(c) or
Section 3.3(d), respectively. The Board shall supervise the liquidation and
winding up of the Company.

                                       36
<PAGE>   40
                                   ARTICLE 14:
                              INDEPENDENT VALUATION

         14.1 Application of Article. This Article 14 applies where the
Shareholders are required to obtain an independent valuation of Shares under the
Joint Venture Agreement.

         14.2 Appointment of Independent Valuer.

                  (a) If this Article 14 applies, the Board shall appoint a
         suitably qualified and experienced independent valuer, corporate
         adviser, chartered accountant, investment banker or merchant banker as
         an Independent Valuer to determine the value of each Share in
         accordance with this Article 14.

                  (b) If the Board fails to appoint a person as contemplated by
         Section 14.2(a), the Independent Valuer will be appointed by KPMG. In
         appointing the Independent Valuer, KPMG must ensure that the
         Independent Valuer satisfies the criteria set out in paragraph (c)
         below;

                  (c) The Independent Valuer must not have had any business
         dealings with any Shareholder or any of its Affiliates in the two years
         before the date of appointment.

         14.3 Valuation. The Independent Valuer must be instructed to determine
the fair market value of the Shares by valuing the Company (including any
subsidiary of the Company) as a whole on a going concern basis (taking into
account the terms of this Joint Venture Agreement and the Related Agreements) as
at the end of the month before the month in which the Independent Valuer is
appointed under this Article 14 ('VALUATION DATE'). In making his valuation, the
Independent Valuer shall assume that the event which has given rise to the
appointment of the Independent Valuer has occurred even if, as of the Valuation
Date, it had not occurred. The fair market value of each Share will be the
proportionate amount of the value of the Company which that Share represents
when compared to the total number of Shares.

         14.4 Access to Information. The Board shall ensure that the Independent
Valuer has a right of access at all reasonable times to the accounting records
and other records of the Company (including any subsidiary of the Company) and
is entitled to require from any officer of the Company any information and
explanation which the Independent Valuer requires to value the Company.

         14.5 Period of Determination. The Board must use commercially
reasonable efforts to ensure that the Independent Valuer makes a determination
as soon as practicable and in any event within sixty (60) days after
appointment.

         14.6 Process. The Shareholders agree that, in determining a value for
the Shares under this Article 14, the Independent Valuer:

                  (a) will act as an expert and not as an arbitrator;

                                       37
<PAGE>   41
                  (b) may obtain or refer to any documents, information or
         material and undertake any inspections or inquiries as he or she
         determines appropriate;

                  (c) must provide the Shareholders with a draft of his or her
         determination and must give the Shareholders a reasonable opportunity
         to comment on the draft determination before it is finalized; and

                  (d) may engage any assistance which he or she reasonably
         believes is appropriate or necessary to make a determination.

         14.7 Final and Binding. The Independent Valuer's determination will be
final and binding on the Shareholders.

         14.8 Costs. The Shareholders will each bear a pro-rata share of the
costs and expenses of the Independent Valuer in accordance with the Agreed
Proportions.

                                   ARTICLE 15:
                            MISCELLANEOUS PROVISIONS

         15.1 Governing Law. This Joint Venture Agreement and the rights and
liabilities of the Shareholders hereunder, shall be governed by and construed in
accordance with the laws of Bermuda.

         15.2 Captions. Captions contained in this Joint Venture Agreement are
inserted only as a matter of convenience and in no way define, limit, extend or
describe the scope of this Joint Venture Agreement or the intent of any
provision hereof.

         15.3 Construction. References in this Joint Venture Agreement to a
statute or statutory instrument include a statute or statutory instrument
amending, consolidating or replacing them, and references to a statue include
statutory instruments and regulations made pursuant to it. Whenever the context
may require, any pronouns used herein shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns and pronouns shall
include the plural and vice versa. This Joint Venture Agreement has been
negotiated by the Shareholders hereto, each of which has been independently
represented by counsel and shall be interpreted in accordance with its terms
without any strict construction for or against any Shareholder.

         15.4 Language. This Joint Venture Agreement is in the English language
only, which language shall be controlling in all respects, and all versions of
this Joint Venture Agreement in any other language shall be for accommodation
only and shall not be binding on the Shareholders to this Joint Venture
Agreement. All communications and notices made or given pursuant to this Joint
Venture Agreement, and all documentation and support to be provided, unless
otherwise noted, shall be in the English version.

                                       38
<PAGE>   42
         15.5 Survival. All representations and warranties herein shall survive
until the dissolution and final liquidation of the Company, except to the extent
that a representation or warranty expressly provides otherwise. In addition
Article 8 (Dispute Resolution), Article 9 (Limitation on Damages; Contractual
Limitation Period), Article 10 (Confidentiality; Public Announcements), Article
15 (Miscellaneous) and Article 16 (Waiver of Conflict of Interest) shall survive
the expiration or earlier termination of this Joint Venture Agreement.

         15.6 Severability. Every provision of this Joint Venture Agreement is
intended to be severable. If any term or provision hereto is illegal or invalid
for any reason whatsoever, such illegality or invalidity shall not affect the
validity of the remainder of the terms or provisions of this Joint Venture
Agreement and the Shareholders agree that they will negotiate in good faith to
achieve an agreement that produces the same or a substantially similar result.

         15.7 Assignment; Successors. Except as otherwise set forth herein,
neither party may assign or delegate any of its rights or obligations hereunder.
Any assignment or delegation in derogation of this Section 15.7 shall be null
and void. Subject to the limitations on transferability contained herein, each
and all of the covenants, terms, provisions and agreements herein contained in
shall be binding upon and inure to the benefit of the successors and assigns
(including an assignee of all or part of an interest in the Company ) of the
respective Shareholders hereto.

         15.8 Execution and Counterparts. This Joint Venture Agreement and any
amendment hereto may be executed in multiple counterparts, each of which shall
be deemed an original and all of which together shall constitute one agreement.
In addition, this Joint Venture Agreement may be executed through the use of
counterpart signature pages. The signature of any Shareholder on any counterpart
agreement or counterpart signature page shall be deemed to be a signature to,
and may be appended to, one document.

         15.9 Third Party Beneficiary. No provision of this Joint Venture
Agreement is intended to be for the benefit of or enforceable by any third party
except for the Company.

         15.10 No Agency. Nothing in this Joint Venture Agreement or the
Schedules hereto shall be deemed to create any partnership or agency
relationship between any Shareholders or between all the Shareholders. The
Shareholders and the Company are each independent companies who shall operate
with each other in arm's length transactions. No Shareholder nor the Company
shall be entitled to act on behalf of and/or bind any one or more of the others
without prior written authorization establishing its authority to do so.

         15.11 Entire Agreement. This Joint Venture Agreement, together with all
Schedules thereto, and the Related Agreements, collectively set out the entire
understanding and agreement between the Shareholders with respect to the matters
specifically addressed herein and therein and merger and supersedes all previous
communications, negotiations, representations and agreements, either oral or
written, with respect to the subject matter hereof and thereof. No agreements,
guarantees or representations, whether oral or in writing, have been concluded,
issued or made, upon which any Shareholder is relying in concluding this Joint
Venture Agreement and the Related Agreements except to the extent expressly set
out herein or therein.

                                       39
<PAGE>   43
         15.12 Amendment. The amendment of this Joint Venture Agreement shall
require the written consent or affirmative vote of each Shareholder hereto.

         15.13 Notices. Any notice, consent, election, approval, payment,
demand, or communication required or permitted to be given by this Joint Venture
Agreement shall be in writing, must be in English and shall be deemed to have
been sufficiently given or served for all purposes if delivered personally or by
facsimile to the Shareholder or to an officer of the Shareholder to which
directed or if sent by registered or certified mail, postage and charges
prepaid, addressed to the address contained in the records of the Company. Any
such notice shall be deemed to be given on the date on which it was delivered
personally, sent by facsimile with transmission confirmation (provided that the
Shareholder giving notice shall also have deposited such notice for mailing
pursuant to the provisions of this Section 15.13) or three (3) calendar days
(or, if to an address outside the United States, seven (7) calendar days) after
deposited in a regularly maintained receptacle for the deposit of United States
Air Mail addressed as set out above. Any Shareholder may change its address for
purposes of this Joint Venture Agreement by giving the other Shareholders notice
of such change in the manner as set out above.

         15.14 Further Documents. The Shareholders hereto agree to execute and
deliver to each other and/or to the Company, as the case may be, all such
additional instruments, to provide all such information, and to do or refrain
from doing all such further acts and things as may be necessary or as my be
reasonably requested by any Shareholder hereto, more fully to vest in, and to
assure each Shareholder of, all rights, powers, privileges, and remedies, herein
intended to be granted or conferred upon such Shareholder or the Company.

         15.15 Action by the Company. Wherever in this Joint Venture Agreement
it states that any action is to be taken by the Company, it shall mean that the
Shareholders to this Joint Venture Agreement shall endeavor to use all
reasonable efforts as Shareholders of the Company to cause the Company to take
such action as herein described.

         15.16 Several Liability. The obligations of each of the Shareholders
under this Joint Venture Agreement are several and not joint.

         15.17 Fees and Expenses. Each party will pay its own fees and expenses
in connection with the formation of the Company and the preparation and
negotiation of this Joint Venture Agreement and the Related Agreements.

         15.18 Prevalence of Agreement. In the event of any ambiguity or
conflict arising between the terms of this Joint Venture Agreement and those of
the Memorandum of Association of the Company, the terms of this Joint Venture
Agreement shall prevail as between the Parties except as otherwise provided by
applicable law.

         15.19 Precedence. The provisions of this Joint Venture Agreement shall
prevail over any inconsistencies or conflicting provisions of any of the Related
Agreements.

                                       40
<PAGE>   44
                                   ARTICLE 16:
                         WAIVER OF CONFLICT OF INTEREST

         EACH OF THE SHAREHOLDERS HAS BEEN REPRESENTED BY SEPARATE COUNSEL IN
CONNECTION WITH THIS JOINT VENTURE AGREEMENT AND THE RELATED AGREEMENTS. SUCH
COUNSEL HAS NOT REPRESENTED THE COMPANY TO DATE. THE LAWYERS, ACCOUNTANTS AND
OTHER EXPERTS WHO HAVE PERFORMED SERVICES FOR THE SHAREHOLDERS IN THE PAST MAY
PERFORM SERVICES FOR THE COMPANY AND MAY CONTINUE TO ALSO PERFORM SERVICES FOR
THE SEPARATE SHAREHOLDERS IN THE FUTURE. TO THE EXTENT THAT SUCH DUAL
REPRESENTATION CONSTITUTES A CONFLICT OF INTEREST, THE COMPANY AND EACH OF THE
SHAREHOLDERS HEREBY EXPRESSLY WAIVE ANY SUCH CONFLICT OF INTEREST WITH RESPECT
TO ANY SUCH DUAL REPRESENTATION RELATIVE TO THE NEGOTIATION, AUTHORSHIP AND
EXECUTION OF THIS JOINT VENTURE AGREEMENT AND THE RELATED AGREEMENTS.

                  (REMAINDER OF THIS PAGE INTENTIONALLY BLANK)

                                       41
<PAGE>   45
  IN WITNESS WHEREOF, the undersigned have each executed or caused this Joint
 Venture Agreement to be executed as of the date and year first above written.

EXODUS COMMUNICATIONS, INC., a               ASIA GLOBAL CROSSING, LTD., a
Delaware corporation                         company organized under the laws of
                                             Bermuda

By: _______________________________          By: _______________________________
(SIGNATURE)                                  (SIGNATURE)

Its: ______________________________          Its: ______________________________
(TITLE)                                      (TITLE)

EXODUS ASIA-PACIFIC LTD, a company
organized under the laws of Bermuda

By: _______________________________
(SIGNATURE)

Its: ______________________________
(TITLE)

                   [SIGNATURE PAGE TO JOINT VENTURE AGREEMENT]

                                       42<PAGE>   1
                                                                     EXHIBIT 4.1

                    CERTIFICATE OF DESIGNATIONS, PREFERENCES,
                       AND RELATIVE RIGHTS AND LIMITATIONS
                                     OF THE

             SERIES B SENIOR CONVERTIBLE CUMULATIVE PREFERRED STOCK

                                       OF

                           CONTANGO OIL & GAS COMPANY
                               (the "Corporation")

1.       Designation. A series of the Preferred Stock of the Corporation is
hereby designated as "Series B Senior Convertible Cumulative Preferred Stock"
consisting initially of 10,000 authorized shares each having a par value of
$0.04 (hereinafter called the "Series B Preferred Stock"). Shares of the Series
B Preferred Stock shall rank prior to the Corporation's Common Stock (and any
Junior Stock (as hereinafter defined) with respect to the payment of dividends
or distributions and upon liquidation, dissolution, winding-up or otherwise.
(All equity securities of the Corporation to which the Series B Preferred Stock
ranks prior, whether with respect to dividends or distributions or upon
liquidation, dissolution, winding-up or otherwise, including the Common Stock,
are collectively referred to herein as "Junior Stock"; all equity securities of
the Corporation with which the Series B Preferred Stock ranks on a parity,
whether with respect to dividends or distributions or upon liquidation,
dissolution, winding-up or otherwise, are collectively referred to herein as
"Parity Stock"; and all equity securities of the Corporation to which the
Preferred Stock ranks junior, whether with respect to dividends or distributions
or upon liquidation, dissolution, winding-up or otherwise, are collectively
referred to herein as "Senior Stock"). Except for shares of Series B Preferred
Stock issuable in accordance with Section 2 hereof, the Corporation shall not
issue any shares of Series B Preferred Stock after the initial issuance of
Series B Preferred Stock.

2.       Dividends.

         (a) The holders of the shares of Series B Preferred Stock shall be
entitled to receive quarterly dividends at a dividend rate equal to 8% per annum
(or 2% per Quarterly Dividend Period) if paid in cash on a current quarterly
basis (the "Cash Dividend Rate") or otherwise at a dividend rate equal to 10%
per annum (or 2.5% per Quarterly Dividend Period) if not paid on a current
quarterly basis or if paid in shares of Series B Preferred Stock (the "PIK
Dividend Rate") (the applicable dividend rate being hereinafter referred to as
the "Dividend Rate"), in each case computed on the basis of $1,000 per share,
when and as declared by the Board of Directors of the Corporation, out of funds
or shares of Series B Preferred Stock legally available for the payment of
dividends. Quarterly dividend periods (each a "Quarterly Dividend Period") shall
commence on January 1, April 1, July 1 and October 1 in each year, except that
the first Quarterly Dividend Period shall commence on the date of issuance of
the Series B Preferred Stock, and shall end on

<PAGE>   2

and include the day immediately preceding the first day of the next Quarterly
Dividend Period. Dividends on the shares of Series B Preferred Stock shall be
payable on March 31, June 30, September 30 and December 31 of each year (a
"Dividend Payment Date"), commencing September 30, 2000. Each such dividend
shall be paid to the holders of record of the Series B Preferred Stock as they
shall appear on the stock register of the Corporation on such record date, not
exceeding 45 days nor less than 10 days preceding such Dividend Payment Date, as
shall be fixed by the Board of Directors of the Corporation or a duly authorized
committee thereof.

              If, on any Dividend Payment Date, the holders of the Series B
Preferred Stock shall not have received the full dividends provided for in this
Section 2(a) in cash or in kind, then such dividends shall cumulate, whether or
not earned or declared, with additional dividends thereon, compounded quarterly,
at the PIK Dividend Rate applicable to the Series B Preferred Stock as provided
in this Section 2(a), for each succeeding full Quarterly Dividend Period during
which such dividends shall remain unpaid.

         (b) The amount of any dividends accrued on any share of the Series B
Preferred Stock on any Dividend Payment Date shall be deemed to be the amount of
any unpaid dividends accumulated thereon to and including such Dividend Payment
Date, whether or not earned or declared. The amount of dividends accrued on any
share of the Series B Preferred Stock on any date other than a Dividend Payment
Date shall be deemed to be the sum of (i) the amount of any unpaid dividends
accumulated thereon to and including the last preceding Dividend Payment Date,
whether or not earned or declared, and (ii) an amount determined by multiplying
(x) the Cash Dividend Rate by (y) a fraction, the numerator of which shall be
the number of days from the last preceding Dividend Payment Date to and
including the date on which such calculation is made and the denominator of
which shall be the full number of days in such Quarterly Dividend Period.

         (c) Immediately prior to authorizing or making any distribution in
liquidation with respect to the Series B Preferred Stock (other than a purchase
or acquisition of Series B Preferred Stock pursuant to a purchase or exchange
offer made on the same terms to holders of all outstanding Series B Preferred
Stock), the Board of Directors shall, to the extent of any funds legally
available therefor, declare a dividend in cash on the Series B Preferred Stock
payable on the distribution date in an amount equal to any accrued and unpaid
dividends on the Series B Preferred Stock as of such date.

         (d) The Board of Directors may declare dividends payable in shares of
Series B Preferred Stock in lieu of cash dividends on a Dividend Payment Date.
In the event the Board of Directors elects to declare a dividend payable in
shares of Series B Preferred Stock, each holder of shares of Series B Preferred
Stock shall be entitled to receive such additional shares of Series B Preferred
Stock (or cash in lieu of a fraction thereof) equal to the product of (x) the
number of shares of Series B Preferred Stock held by such holder multiplied by
(y) the PIK Dividend Rate.

3.       Priority.

         (a) Parity with Series A Preferred Stock. Unless otherwise expressly
provided herein, the Series B Preferred Stock shall rank on a parity with
respect to the Corporation's Series A Senior Preferred Convertible Cumulative
Preferred Stock (hereinafter called the "Series

                                       2
<PAGE>   3

A Preferred Stock") in all respects, including with respect to dividends or
distributions, redemption or upon liquidation, dissolution, winding-up or
otherwise. Accordingly, the Series A Preferred Stock shall be Parity Stock with
respect to the Series B Preferred Stock, unless otherwise expressly provided
herein.

         (b) Priority as to Dividends.

             (i) Holders of shares of the Series B Preferred Stock shall be
entitled to receive the dividends provided for in Section 2 hereof in preference
to and in priority over any dividends or distributions upon any Junior Stock. No
dividends shall be declared or paid or set apart for payment on any Junior Stock
for any period unless at the time of such declaration or payment or setting
apart for payment (A) full cumulative dividends have been or contemporaneously
are declared and paid in cash (or declared and a sum sufficient for the payment
thereof set apart for such payment) on the Series B Preferred Stock for all
Quarterly Dividend Periods terminating on or prior to the date of payment of
such dividends on Junior Stock, (B) an amount equal to the dividends accrued on
the Series B Preferred Stock from the last Dividend Payment Date to the date of
payment of such dividends on Junior Stock has been declared and set apart in
cash for payment on the Series B Preferred Stock and (C) the dividend payment
for the most recent Quarterly Dividend Period on the Series B Preferred Stock
has been paid entirely in cash.

             (ii) No dividends shall be declared or paid or set apart for
payment on any Parity Stock for any period unless at the time of such
declaration or payment or setting aside for payment dividends have been or
contemporaneously are declared and paid in accordance with Section 2 hereof on
the Series B Preferred Stock for all Quarterly Dividend Periods terminating on
or prior to the date of payment of such dividends on Parity Stock. All dividends
paid upon shares of the Series B Preferred Stock and any Parity Stock shall be
paid pro rata so that the amount of dividends paid per share of the Series B
Preferred Stock and such Parity Stock shall in all cases bear to each other the
same ratio that accrued and unpaid dividends per share on the Series B Preferred
Stock and such Parity Stock bear to each other.

         (c) Priority on Redemption. The Corporation shall not, directly or
indirectly, redeem or purchase or otherwise acquire for value any Junior Stock
or Parity Stock unless, at the time of making such redemption, purchase or other
acquisition, full cumulative dividends have been or contemporaneously are
declared and paid in accordance with Section 2 hereof (or declared and a sum (or
shares of Series B Preferred Stock) sufficient for payment thereof set apart for
such payment) on the Series B Preferred Stock for all Quarterly Dividend Periods
terminating on or prior to the date of redemption of Junior Stock and/or Parity
Stock.

4.       Redemption. Upon the sale, conveyance or disposition of all or
substantially all of the assets of the Corporation or a sale, conveyance or
disposition of a majority of the outstanding shares of common stock in a
transaction or series of related transactions (except for a merger or
consolidation after the consummation of which the stockholders of the
Corporation prior to such merger or consolidation own a majority of the voting
securities of the surviving corporation or its parent corporation), each holder
of Series B Preferred Stock shall have the right to require that the Corporation
redeem all or any part of such holder's Series B Preferred Stock for cash out of
legally available funds at a price per share equal to the Liquidation Preference
(as defined in

                                       3
<PAGE>   4

Section 7(d) but with the accrued and unpaid dividends being paid through the
date of redemption rather than the Conversion Date). If on the date of such
sale, conveyance or disposition funds legally available for such redemption
shall be insufficient to redeem all of the outstanding shares of Series B
Preferred Stock held by holders who have elected to have their shares redeemed,
funds to the extent legally available shall be used for such purpose and the
Corporation shall effect such redemption pro rata according to the number of
shares of Series B Preferred Stock held by each holder thereof. The redemption
requirements provided hereby shall be continuous, so that if on the date of such
sale, conveyance or disposition such requirements cannot be fully discharged,
without further action by any holder of the Series B Preferred Stock funds
legally available shall be applied therefor until such requirements are
fulfilled. Upon payment in full of the amounts owing under this Section 4 to any
holder of Series B Preferred Stock who has elected to have its shares redeemed,
then notwithstanding that the certificate or certificates evidencing such shares
shall not have been surrendered, the dividends with respect to such shares shall
cease to accrue after the date of such payment in full and all rights with
respect to such shares shall forthwith terminate.

5.       Liquidation Preference.

         (a) In the event of any liquidation, dissolution or winding up of the
affairs of the Corporation, whether voluntary or involuntary, after payment or
provision for payment of the debts and other liabilities of the Corporation, the
holders of shares of the Series B Preferred Stock shall be entitled to receive,
out of the assets of the Corporation, whether such assets are capital or surplus
and whether or not any dividends as such are declared, $1,000 per share plus an
amount equal to all accrued and unpaid dividends thereon to the date fixed for
distribution, and no more, before any distribution shall be made to the holders
of Junior Stock with respect to the distribution of assets. If the assets of the
Corporation are not sufficient to pay in full the liquidation payments payable
to the holders of outstanding shares of the Series B Preferred Stock and any
other Parity Stock, then the holders of all such shares shall share ratably in
such distribution of assets in accordance with the amount which would be
otherwise payable on such distribution to the holders of Series B Preferred
Stock and the holders of such Parity Stock were such liquidation payments paid
in full. Except as provided, in this Section 5(a), in the event of any
liquidation, dissolution or winding up of the affairs of the Corporation, the
holders of shares of Series B Preferred Stock shall not be entitled to any
additional payments.

         (b) Written notice of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Corporation, stating a payment
date and the place where the distributive amounts shall be payable, shall be
given by mail, postage prepaid, not less than 30 days prior to the payment date
stated therein, to the holders of record of the Series B Preferred Stock at
their respective addresses as the same shall appear on the books of the
Corporation.

6.       Voting Rights.

         (a) General. In addition to the rights otherwise provided for herein or
by law, holders of Series B Preferred Stock shall be entitled to vote, together
with the holders of Common Stock and any other voting Junior Stock or Parity
Stock, as one class on all matters submitted to a vote of stockholders of the
Corporation, in the same manner and with the same effect as the holders of
Common Stock. In any such vote, each share of Series B Preferred Stock shall
entitle the holder

                                       4
<PAGE>   5

thereof to one vote per share for each share of Common Stock (including
fractional shares) into which each share of Series B Preferred Stock is then
convertible, rounded to the nearest one-tenth of a share.

         (b) Protective Provisions. So long as any Series B Preferred Stock is
outstanding, the holders of the Series B Preferred Stock shall have the voting
power provided for by law and the Corporation covenants and agrees that it shall
not, without the written consent in lieu of a meeting, or the affirmative vote
at a meeting called for such purpose, of holders of Series B Preferred Stock of
record that hold at least a majority of the outstanding Series B Preferred
Stock, voting as a separate class:

             (i) amend, alter or repeal, in any manner whatsoever, the
designations, powers, preferences, relative, participating, optional or other
special rights, qualifications, limitations and restrictions of the Series B
Preferred Stock;

             (ii) authorize, issue, or agree to authorize or issue, whether by
reclassification or otherwise, any Senior Stock;

             (iii) authorize, issue, or agree to authorize or issue, whether by
reclassification or otherwise, any new class or series of stock or any other
securities convertible into equity securities of the Corporation ranking on a
parity with the holders of Series B Preferred Stock with respect to the rights
of redemption, liquidation, preference, voting or dividends, or any increase in
the authorized or designated number of any such new class or series, other than
the Series A Preferred Stock;

             (iv) amend, alter or repeal any provision of the articles of
incorporation of the Corporation, including the certificate of designation of
any class or series of stock;

             (v) directly or indirectly, redeem, purchase or otherwise acquire
for value (including through an exchange), or set apart money or other property
for any mandatory purchase or other analogous fund for the redemption, purchase
or acquisition of, any shares of Common Stock or other Junior Stock;

             (vi) consolidate or merge with or into any other corporation where
(1) the Corporation is not the surviving corporation or (2) the Corporation
shall issue to any person as consideration in respect of such consolidation or
merger any capital stock of the Corporation representing 20% or more of the
Corporation's outstanding capital stock prior to such consolidation or merger;

             (vii) sell or convey all or substantially all of the assets of the
Corporation, or dissolve or liquidate the Corporation; or

             (viii) incur any indebtedness, liabilities or obligations
constituting Restricted Debt (as defined below), which in the aggregate with all
other Restricted Debt of the Corporation (on a consolidated basis) is in excess
of 50% of the NPV10 (as defined below) of the Proved Reserves (as defined below)
attributable to the properties of the Corporation at the time of incurrence.

                                       5
<PAGE>   6

             For purposes of this Section 6(b), the following terms shall have
the meanings set forth below:

             "NPV10" means with respect to any Proved Reserves as expected to be
produced from the properties of the Corporation, the net present value of the
future net revenues expected to accrue to the Corporation's interests in such
Reserves during the remaining expected economic lives of such Reserves,
discounted at 10% per annum. Each calculation of such expected future net
revenues shall be made at the time of incurrence in accordance with the then
existing standards of the Society of Petroleum Engineers and Society of
Petroleum Evaluation Engineers, provided that in any event:

             (i)          appropriate deductions shall be made for (A) direct
                          taxes and existing burdens, (B) lease operating
                          expenses, (C) transportation, gathering and marketing
                          burdens, (D) capital expenditures (including plugging
                          and abandonment costs), and (E) general and
                          administrative or overhead costs pursuant to the
                          relevant operating agreements (COPAS); and

             (ii)         the pricing assumptions and escalations used in
                          determining NPV10 for any particular Proved Reserves
                          shall be:

                          (A)          the contract price, if any, during the
                                       term of any written oil and gas sales
                                       contract between Corporation and
                                       unrelated persons; or

                          (B)          if no sales contract exits:

                                       (I)          for volumes of oil and gas
                                                    swapped or hedged with
                                                    investment grade counter
                                                    parties, the hedged price
                                                    net of any costs, expenses
                                                    or deductions relating
                                                    thereto; and

                                       (II)         for "naked" or long unhedged
                                                    volumes, the oil and gas
                                                    prices reflected in the
                                                    NYMEX oil and gas strips
                                                    going forward one year with
                                                    adjustment for basis
                                                    (quality and geographical)
                                                    differentials.

         "Proved Reserves" means those reserves which are "proved oil and gas
reserves" within the meaning of Rule 4-10 of Regulation S-X, 17 C.F.R. ss.
210.4-10 of the Securities Exchange Commission. In addition, Proved Reserves
must have facilities to process and transport those reserves to market which are
operational at the time of the estimate, or there is a commitment or reasonable
expectation to install such facilities in the future.

         "Restricted Debt" of any Person means debt in any of the following
categories: (i) debt for borrowed money; (ii) debt constituting an obligation to
pay the deferred purchase price of property or services; (iii) debt evidenced by
a bond, debenture, note or similar instrument; (iv) debt which (A) would under
GAAP be shown on the Corporation's balance sheet as a liability and (B) is
payable more than one year from the date of creation thereof (other than
reserves for taxes and contingent obligations); (v) debt constituting principal
under leases capitalized in accordance with GAAP; (vi) debt arising under
conditional sales or other title retention agreements; (vii) debt owing under
direct or indirect guaranties of debt of any other

                                       6
<PAGE>   7

person or constituting obligations to purchase or acquire or to otherwise
protect or insure a creditor against loss in respect of debt of any other person
(such as obligations under working capital maintenance agreements, agreements to
keep-well, or agreements to purchase debt, assets, goods, securities or
services), but excluding endorsements in the ordinary course of business of
negotiable instruments in the course of collection; (viii) debt with respect to
letters of credit or applications or reimbursement agreements therefor;
provided, however, that the term "Restricted Debt" shall not include debt which
is 60 days or less past due that was incurred on ordinary trade terms and is
owed by the Corporation incurring the same to vendors, suppliers, or other
persons providing goods and services for use by the Corporation in the ordinary
course of its business.

         (c) Dividend Default. In the event of a Dividend Default (as
hereinafter defined), the number of directors on the Board of Directors of the
Corporation shall be increased by two directors, both of whom shall be nominated
and elected as soon as practicable pursuant to the Bylaws of the Corporation by
the holders of the Series B Preferred Stock, to serve until the later of (i) the
date of the next annual meeting of stockholders and until such directors'
successors are elected and qualify and (ii) the date on which the Dividend
Default is cured; provided, however, that if permitted under applicable law, the
holders of the Series B Preferred Stock shall have the right to elect the same
individual to serve as both directors and, if so elected, such individual shall
be treated as constituting two directors for all purposes including without
limitation voting and quorum. A "Dividend Default" shall occur if, at any time,
dividends are not paid in full (either in cash or in kind as provided for
herein) with respect to all shares of Series B Preferred Stock on any two
consecutive Dividend Payment Dates.

         (d) Board of Directors. If at any time a majority of the holders of the
Series B Preferred Stock has not appointed or nominated for election at least
one of the members of the Corporation's Board of Directors and shares of Series
B Preferred Stock remain outstanding, then the holders of the Series B Preferred
Stock shall be entitled to appoint one observer to the Corporation's Board of
Directors (the "Observer"). Such Observer shall have the right to attend, and
receive all materials distributed for or at, all meetings (telephone and
otherwise) of the Board of Directors (including committees thereof) and shall be
entitled to the same rights and privileges as directors of the Corporation,
except that such Observer shall not be entitled to vote on matters presented to
or discussed by the Board of Directors. The Observer will receive compensation
from the Corporation for his services as observer on an equal basis with the
directors of the Corporation and shall be entitled to be reimbursed by the
Corporation for all reasonable costs and expenses incurred in connection with
his participation in meetings or other activities of the Board of Directors. The
holders of the Series B Preferred Stock will use commercially reasonable efforts
to cause the Observer to keep all information provided to the Observer in
connection with all meetings of the Board of Directors confidential prior to its
becoming public, except that the Observer shall be permitted to disclose such
information (i) to officers, directors, employees, representatives, agents,
auditors, accountants, consultants, advisors, lawyers and affiliates of the
holders of the Series B Preferred Stock in the ordinary course of business who
have been made aware of the confidential nature of the information; (ii) to
prospective assignees and their respective directors, employees, agents and
representatives who have agreed in writing to become subject to this
confidentiality provision, (iii) as required by applicable law, or pursuant to
subpoenas or other legal process, or as requested by governmental agencies and
examiners; (iv) to the extent such information (A) becomes available to the
Observer other than

                                       7
<PAGE>   8

as a result of a breach of this provision or (B) becomes available to the
Observer on a non-confidential basis, or (v) to the extent the Corporation shall
have consented to such disclosure in writing.

7.       Conversion Rights.

         (a) Voluntary Conversion. At a holder's election, the Series B
Preferred Stock may be converted, in whole or in part, to fully paid and
nonassessable shares of Common Stock at a conversion price of $2.20 per share,
as adjusted in accordance with Section 8 hereof (the "Conversion Price"). The
number of shares of the Common Stock into which a share of Series B Preferred
Stock is convertible shall be equal to the Liquidation Preference (as defined in
Section 7(d)) of such share of Series B Preferred Stock divided by the
Conversion Price in effect on the Voluntary Conversion Date (as hereinafter
defined).

         (b) Exercise of Voluntary Conversion Privilege. In order to exercise
the voluntary conversion privilege, the registered holder of any share of Series
B Preferred Stock to be converted shall surrender the certificate representing
such share at the office of the Corporation and shall give written notice (the
"Conversion Notice") to the Corporation at said office that the holder elects to
convert such shares of Series B Preferred Stock or a specified portion thereof
into shares of Common Stock. As promptly as practicable after the receipt of the
Conversion Notice (such date of receipt, the "Voluntary Conversion Date") and
the surrender of such shares of Series B Preferred Stock, the Corporation shall
issue and deliver to the registered holder of such shares of Series B Preferred
Stock, at the address set forth on the Conversion Notice, a certificate or
certificates for the number of full shares of Common Stock, as applicable,
issuable upon the conversion of such shares of Series B Preferred Stock (or a
specified portion thereof) and cash in respect of any fraction of a share
issuable upon such conversion. Such conversion shall be deemed to have been
effected at the close of business on the Voluntary Conversion Date, and the
holder of such shares of Series B Preferred Stock shall be deemed to have become
the holder of record of the shares of Common Stock represented thereby as of the
Voluntary Conversion Date.

         (c) Mandatory Conversion. In the event the mean average traded price of
the Corporation's Common Stock on each of the immediately preceding 20
consecutive Trading Days (as hereinafter defined) is equal to or greater than
$2.50 per share (as adjusted for any subdivision or combination of outstanding
Common Stock) (a "Mandatory Conversion Event"), the Corporation may elect to
convert all, but not less than all, of the outstanding shares of Series B
Preferred Stock to fully paid and nonassessable shares of Common Stock at the
Conversion Price (as defined in Section 7(a)). In order to effect the mandatory
conversion of the Series B Preferred Stock, the Corporation shall mail notice
(the "Mandatory Conversion Notice") to all holders of outstanding shares of
Series B Preferred Stock within 10 days after the occurrence of a Mandatory
Conversion Event, specifying a date (which must be at least 10 but not more than
30 days after the date of such notice (the "Mandatory Conversion Date"). The
number of shares of the Common Stock into which a share of Series B Preferred
Stock is convertible shall be equal to the quotient of the Liquidation
Preference (as defined in Section 7(d)) of such share of Series B Preferred
Stock divided by the Conversion Price.

             On or before the Mandatory Conversion Date, each holder of Series B
Preferred

                                       8
<PAGE>   9

Stock shall surrender the certificate(s) representing the Series B Preferred
Stock to the Corporation at said office, accompanied by a written statement
setting forth the name or names (with address) in which the certificate or
certificates for shares of Common Stock shall be issued. As promptly as
practicable thereafter, the Corporation shall issue and deliver to the
registered holder of such shares of Series B Preferred Stock, at the address
specified by the holder, a certificate or certificates for the full shares of
Common Stock issuable upon mandatory conversion pursuant to this Section 7(c).

             For purposes of this Section 7(c), "Trading Day" shall mean (1) (x)
if the Common Stock is listed on at least one stock exchange, a day on which
there is trading on the principal stock exchange on which the Common Stock is
listed, (y) if the Common Stock is not listed on a stock exchange, but sale
prices of the Common Stock are reported on an automated quotation system, a day
on which trading is reported on the principal automated quotation system on
which sales of the Common Stock are reported, or (z) if the Common Stock is not
listed on a stock exchange and sale prices of the Common Stock are not reported
on an automated quotation system, a day on which quotations are reported by
National Quotation Bureau Incorporated, and (2) the volume of shares of Common
Stock sold on such day is 50,000 shares (as adjusted in the same manner and
proportion as the adjustment of a Stock Unit in accordance with Section 8(a)
hereof) or more. For purposes of this Section 7(c), Trading Days shall not be
deemed to be "consecutive" if there shall occur any day which meets the criteria
set forth in clause (1) of the preceding sentence but does not meet the criteria
set forth in clause (2) thereof between one Trading Day and the next Trading
Day.

         (d) As used in this Section 7, the term "Liquidation Preference" shall
mean the sum of (i) $1,000 per share of Series B Preferred Stock and (ii)
accrued and unpaid dividends on the applicable Conversion Date calculated in
accordance with Sections 2(a) and (b) hereof.

         (e) Fractional Shares. The Corporation shall not be required to issue
fractional shares of Common Stock upon the conversion of shares of the Series B
Preferred Stock. If shares of the Series B Preferred Stock (or specified
portions thereof, if applicable) shall be presented for conversion which would
result in the issuance of any fraction of a share of Common Stock, the
Corporation may instead pay an amount in cash equal to the Conversion Price on
the day immediately preceding the Voluntary Conversion Date or the Mandatory
Conversion Date, as the case may be, multiplied by such fraction.

         (f) Reservation of Shares. The Corporation shall at all times reserve
and keep available, free from preemptive rights, out of its authorized but
unissued Common Stock, for the purpose of enabling it to set aside shares to
satisfy any obligation to issue shares of Common Stock upon conversion of Series
B Preferred Stock, such number of shares of Common Stock as shall then be
issuable upon the conversion of all outstanding shares of Series B Preferred
Stock. The shares of Common Stock issuable upon conversion of shares of Series B
Preferred Stock shall, upon issuance, be duly authorized, validly issued, fully
paid, nonassessable, free of preemptive rights and free and clear of all liens,
charges, security interests and other encumbrances whatsoever.

8.       Adjustment of Number of Shares Issuable Upon Conversion and the
Conversion Price. The number of shares issuable upon conversion and the
Conversion Price (and each component

                                       9
<PAGE>   10

thereof) are subject to adjustment from time to time as set forth in this
Section 8 with respect to any fact or event described herein occurring after the
date hereof. Anything contained in this Section 8 notwithstanding, any
adjustment made pursuant to any provision of this Section 8 shall be made
without duplication of an adjustment otherwise required by and made pursuant to
another provision of this Section 8 on account of the same facts or events.

         (a) Definitions. For purposes of this Section 8, the following terms
shall have the meanings ascribed to such terms below:

                  "5-DAY AVERAGE PRICE" per share of Common Stock, for purposes
             of any provision herein at the date specified in such provision,
             shall mean the average closing price of the Common Stock on the
             securities exchange or other national market system on which the
             Common Stock is then traded over the 5-trading day period
             immediately prior to such date or, if the Common Stock is not then
             traded on a securities exchange or national market system, the
             average of the bid and asked prices on the over-the-counter market
             on which the Common Stock is then traded as of the close of such
             market over the 5-trading day period immediately prior to such
             date.

                  "30-DAY AVERAGE PRICE" per share of Common Stock, for purposes
             of any provision herein at the date specified in such provision,
             shall mean the average closing price of the Common Stock on the
             securities exchange or other national market system on which the
             Common Stock is then listed over the 30-trading day period
             immediately prior to such date or, if the Common Stock is not then
             traded on a securities exchange or national market system, the
             average of the bid and asked prices on the over-the-counter market
             on which the Common Stock is then traded as of the close of such
             market over the 30-trading day period immediately prior to such
             date.

                  "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares of
             Common Stock issued by the Corporation after the Closing Date other
             than (i) any shares of Common Stock issued pursuant to the
             outstanding warrants, options and convertible stock listed on
             Attachment 1, (ii) shares of Common Stock issued pursuant to
             options to purchase Common Stock issued pursuant to the
             Corporation's 1999 Stock Incentive Plan, including those options
             issued to date and listed on Attachment 1, in an aggregate amount
             not to exceed 5,000,000 shares, (iii) any shares of Common Stock
             issued upon the exercise of options granted to Juneau Exploration
             Company, LLC ("JEX") pursuant to the Corporation's exploration
             agreement with JEX dated September 1, 1999, as amended, (iv) any
             shares of Common Stock issued to Glen Dillon in a number not to
             exceed 1,250 per month, (v) any shares of Common Stock issued upon
             conversion of Series A Preferred Stock issued to the Trust Company
             of the West, in its capacities as Investment Manager and Custodian
             ("TCW"), (vi) any shares of Common Stock issued to William Gibbons,
             the Corporation's treasurer and assistant secretary, in a number
             not to exceed 2,000 shares per month through December 31, 2000,
             (vii) any shares of Common Stock issued pursuant to warrants to
             purchase up to 125,000 shares of Common Stock issued to Fairfield

                                       10
<PAGE>   11

             Industries Incorporated on or prior to the Closing Date, (viii) any
             shares of Common Stock issued pursuant to warrants to purchase up
             to 125,000 shares of Common Stock issued to JEX on or prior to the
             Closing Date, (ix) any shares of Common Stock issued pursuant to
             warrants to purchase up to 250,000 shares of Common Stock issued to
             the Southern Ute Indian Tribe doing business as the Southern Ute
             Indian Tribe Growth Fund ("SUIT") on or prior to the Closing Date,
             (x) any shares of Common Stock issued pursuant to warrants to
             purchase up to 500,000 shares of Common Stock issued to TCW on or
             prior to the Closing Date, (xi) any shares of Common Stock issued
             pursuant to options granted to SUIT on a quarterly basis to the
             same extent such options are granted to the Corporation's outside
             directors under the 1999 Stock Incentive Plan, (xii) any shares of
             Common Stock issued pursuant to options granted to TCW on a
             quarterly basis to the same extent such options are granted to the
             Corporation's outside directors under the 1999 Stock Incentive
             Plan, (xiii) any shares of Common Stock issued upon conversion of
             the Corporation's Series B Preferred, and (xiv) any shares of
             Common Stock issued pursuant to a 401(k) or other qualified
             retirement plan for officers, directors or employees of the
             Corporation and its affiliates in an aggregate amount not to exceed
             100,000 shares.

                  "APPRAISED VALUE" shall mean the fair market value of all
             outstanding Common Stock, as determined by a written appraisal (the
             "APPRAISAL") prepared by a national or major regional investment
             bank acceptable to the Board of Directors of the Corporation and
             the holders of the Series B Preferred Stock. "Fair market value" is
             defined for this purpose as the price in a single transaction
             determined on a going-concern basis that would be agreed upon by
             the most likely hypothetical buyer for 100% of the equity capital
             of the Corporation. In the event that the Corporation and the
             holders of the Series B Preferred Stock cannot, in good faith,
             agree upon an investment bank, then the Corporation, on the one
             hand, and the holders of the Series B Preferred Stock, on the other
             hand, shall each select an investment bank, the two investment
             banks so selected shall select a third investment bank who shall be
             directed to prepare the Appraisal and the term Appraised Value
             shall mean the appraised value set forth in the Appraisal prepared
             in accordance with this definition. The Corporation shall pay for
             the cost of any such Appraisal.

                  "CLOSING DATE" shall mean September 27, 2000.

                  "CONVERTIBLE SECURITIES" shall mean evidences of indebtedness,
             shares of stock or other securities which are convertible or
             exchangeable for Additional Shares of Common Stock, either
             immediately or upon the arrival of a specified date or the
             happening of a specified event.

                  "CURRENT CONVERSION PRICE" per share of Common Stock, for the
             purpose of any provision herein at the date herein specified, shall
             mean the amount equal to the quotient resulting from dividing the
             Conversion Price per Stock Unit in effect on such date by the
             number of shares (including any fractional share) of Common Stock
             comprising a Stock Unit on such date.

                                       11
<PAGE>   12

                  "CURRENT MARKET PRICE" per share of Common Stock for the
             purposes of any provision herein at a date herein specified, shall
             mean the greater of (i) the 30-Day Average Price of the Common
             Stock or (ii) the 5-Day Average Price of the Common Stock;
             provided, that if the Current Market Price per share of Common
             Stock cannot be ascertained by such methods, then the Current
             Market Price per share of Common Stock shall be deemed to be the
             greater of (i) the net book value per share of Common Stock,
             determined in accordance with generally accepted accounting
             principles, or (ii) the fair value per share of Common Stock
             determined pursuant to the Appraised Value.

                  "STOCK UNIT" shall mean one share of Common Stock, as such
             Common Stock was constituted on the date of original issue of the
             Series B Preferred Stock and thereafter shall mean such number of
             shares (including any fractional shares) of Common Stock as shall
             result from the adjustments specified in this Section 8.

         (b) Stock Dividends, Subdivisions and Combinations. In case at any time
or from time to time the Corporation shall:

             (i) take a record of the holders of its Common Stock for the
purpose of entitling them to receive a dividend payable in, or other
distribution of, Common Stock, or

             (ii) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock, or

             (iii) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock,

then the number of shares of Common Stock comprising a Stock Unit immediately
after the happening of any event described in clauses (i) through (iii) above
shall be adjusted so as to consist of the number of shares of Common Stock which
a record holder of the number of shares of Common Stock constituting a Stock
Unit immediately prior to the happening of such event would own or be entitled
to receive after the happening of event described in clauses (i) through (iii)
above.

         (c) Certain Other Dividends and Distributions. In case at any time or
from time to time the Corporation shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive any dividend or other
distribution of:

             (i) cash (other than a cash distribution made as a dividend and
payable out of earnings or earned surplus legally available for the payment of
dividends under the laws of the jurisdiction of incorporation of the
Corporation, to the extent, but only to the extent, that the aggregate of all
such dividends paid or declared after the date hereof, does not exceed the
consolidated net income of the Corporation and its consolidated subsidiaries
earned subsequent to the date hereof determined in accordance with generally
accepted accounting principles), or

             (ii) any evidence of its indebtedness (other than Convertible
Securities), any shares of its stock (other than Additional Shares of Common
Stock) or any other securities or

                                       12
<PAGE>   13

property of any nature whatsoever (other than cash and other than Convertible
Securities or Additional Shares of Common Stock), or

             (iii) any warrants, options or other rights to subscribe for or
purchase (x) any evidences of its indebtedness (other than Convertible
Securities), (y) any shares of its stock (other than Additional Shares of Common
Stock) or (z) any other securities or property of any nature whatsoever (other
than cash and other than Convertible Securities or Additional Shares of Common
Stock),

then the number of shares of Common Stock thereafter comprising a Stock Unit
shall be adjusted to that number determined by multiplying the number of shares
of Common Stock comprising a Stock Unit immediately prior to such adjustment by
a fraction (A) the numerator of which shall be the Current Market Price per
share of Common Stock at the date of taking such record, and (B) the denominator
of which shall be such Current Market Price per share of Common Stock minus the
portion applicable to one share of Common Stock of any such cash so
distributable (if any) and of the fair value of any and all such evidences of
indebtedness, shares of stock, other securities or property, or warrants,
options or other subscription or purchase rights, so distributable (if any).
Such fair value shall be determined pursuant to the Valuation Procedure. The
"Valuation Procedure" is a determination of fair value of any property made in
good faith by the Board of Directors of the Corporation; provided, that if the
holders of a majority of the Series B Preferred Stock object to such
determination within ten days of receipt of written notification thereof, then
the fair value of such property shall be determined in good faith by a
recognized national or major regional investment bank selected by the Board of
Directors, which investment bank is not reasonably objected to by the holders of
a majority of the Series B Preferred Stock. The fees and expenses of such
investment bank shall be paid by the Corporation. A reclassification (other than
a change in par value) of the Common Stock into shares of Common Stock and
shares of any other class of stock shall be deemed a distribution by the
Corporation to the holders of its Common Stock of such shares of such other
class of stock within the meaning of this Section 8(c) and, if the outstanding
shares of Common Stock shall be changed into a larger or smaller number of
shares of Common Stock as a part of such reclassification, shall be deemed a
subdivision or combination, as the case may be, of the outstanding shares of
Common Stock within the meaning of Section 8(b).

         (d) Issuance of Additional Shares of Common Stock. In case at any time
or from time to time the Corporation shall (except as hereinafter provided)
issue, whether in connection with the merger of a corporation into the
Corporation or otherwise, any Additional Shares of Common Stock for a
consideration per share less than the greater of (i) the Current Conversion
Price or (ii) the Current Market Price per share of Common Stock, then the
number of shares of Common Stock thereafter comprising a Stock Unit shall be
adjusted to be the greater of (A) that number determined by multiplying the
number of shares of Common Stock comprising a Stock Unit immediately prior to
such adjustment by a fraction (i) the numerator of which shall be the Current
Conversion Price per share of Common Stock, and (ii) the denominator of which
shall be the consideration per share received by the Corporation for such
Additional Shares of Common Stock or (B) that number determined by multiplying
the number of shares of Common Stock comprising a Stock Unit immediately prior
to such adjustment by a fraction (x) the numerator of which shall be the number
of shares of Common Stock outstanding, plus the number of such Additional Shares
of Common Stock so issued, and (y) the denominator of which shall be the

                                       13
<PAGE>   14

number of shares of Common Stock outstanding, plus the number of shares of
Common Stock which the aggregate consideration for the total number of such
Additional Shares of Common Stock would purchase at the greater of the Current
Conversion Price and the Current Market Price per share of Common Stock. For
purposes of this Section 8(d), the date as of which the Current Market Price per
share of Common Stock shall be computed shall be the earlier of (i) the date on
which the Corporation shall enter into a firm contract for the issuance of such
Additional Shares of Common Stock, or (ii) the date of actual issuance of such
Additional Shares of Common Stock. The provisions of this Section 8(d) shall not
apply to any issuance of Additional Shares of Common Stock for which an
adjustment is provided under Section 8(b). No adjustment of the number of shares
of Common Stock comprising a Stock Unit shall be made under this Section 8(d)
upon the issuance of any Additional Shares of Common Stock which are issued
pursuant to the exercise of any warrants, options or other subscription or
purchase rights or pursuant to the exercise of any conversion or exchange rights
in any Convertible Securities, if any such adjustment shall previously have been
made upon the issuance of such warrants, options or other rights or upon the
issuance of such Convertible Securities (or upon the issuance of any warrants,
options or other rights therefor) pursuant to Section 8(e) or Section 8(f).

         (e) Issuance of Warrants, Options or Other Rights. In case at any time
or from time to time the Corporation shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a distribution of, or
shall otherwise issue, any warrants, options or other rights to subscribe for or
purchase any Additional Shares of Common Stock or any Convertible Securities and
the consideration per share for which Additional Shares of Common Stock may at
any time thereafter be issuable pursuant to such warrants, options or other
rights or pursuant to the terms of such Convertible Securities shall be less
than the greater of (A) the Current Conversion Price per share of Common Stock
or (B) the Current Market Price per share of Common Stock, then the number of
shares of Common Stock thereafter comprising a Stock Unit shall be adjusted to
be the greater of those numbers determined pursuant to the first sentence of
Section 8(d). All adjustments made pursuant to this Section 8(e) shall be made
on the basis that (i) the maximum number of Additional Shares of Common Stock
issuable pursuant to all such warrants, options or other rights or necessary to
effect the conversion or exchange of all such Convertible Securities shall be
deemed to have been issued as of the date specified in the last sentence of this
Section 8(e), (ii) the aggregate consideration for such maximum number of
Additional Shares of Common Stock shall be deemed to be the minimum
consideration received and receivable by the Corporation for the issuance of
such Additional Shares of Common Stock pursuant to such warrants, options or
other rights or pursuant to the terms of such Convertible Securities and (iii)
the consideration per share received by the Corporation for such Additional
Shares of Common Stock shall be that number determined by dividing (x) the
aggregate consideration for such maximum number of Additional Shares of Common
Stock (determined as set forth in clause (ii) of this sentence) by (y) the
maximum number of Additional Shares of Common Stock issuable pursuant to all
such warrants, options or other rights or necessary to effect the conversion or
exchange of all such Convertible Securities (determined as set forth in clause
(i) of this sentence). For purposes of this Section 8(e), the computation date
for subclause (i) above and as of which the Current Market Price and the Current
Conversion Price per share of Common Stock shall be computed shall be the
earliest of (A) the date on which the Corporation shall take a record of the
holders of its Common Stock for the purpose of entitling them to receive any
such warrants, options or other rights, (B) the date on which the Corporation
shall

                                       14
<PAGE>   15

enter into a firm contract for the issuance of such warrants, options or other
rights, and (C) the date of actual issuance of such warrants, options or other
rights.

         (f) Issuance of Convertible Securities. In case at any time or from
time to time the Corporation shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a distribution of, or shall
otherwise issue, any Convertible Securities and the consideration per share for
which Additional Shares of Common Stock may at any time thereafter be issuable
pursuant to the terms of such Convertible Securities shall be less than the
greater of (A) the Current Conversion Price per share of Common Stock or (B) the
Current Market Price per share of Common Stock, then the number of shares of
Common Stock thereafter comprising a Stock Unit shall be adjusted to be the
greater of those numbers determined pursuant to the first sentence of Section
8(d). All adjustments made pursuant to this Section 8(f) shall be made on the
basis that (i) the maximum number of Additional Shares of Common Stock necessary
to effect the conversion or exchange of all such Convertible Securities shall be
deemed to have been issued as of the computation date specified in the
penultimate sentence of this Section 8(f), (ii) the aggregate consideration for
such maximum number of Additional Shares of Common Stock shall be deemed to be
the minimum consideration received and receivable by the Corporation for the
issuance of such Additional Shares of Common Stock pursuant to the terms of such
Convertible Securities and (iii) the consideration per share received by the
Corporation for such Additional Shares of Common Stock shall be that number
determined by dividing (x) the aggregate consideration for such maximum number
of Additional Shares of Common Stock (determined as set forth in clause (ii) of
this sentence) by (y) the maximum number of Additional Shares of Common Stock
necessary to effect the conversion or exchange of all such Convertible
Securities (determined as set forth in clause (i) of this sentence). For
purposes of this Section 8(f), the computation date for clause (i) above and as
of which the Current Market Price and the Current Conversion Price per share of
Common Stock shall be computed shall be the earliest of (A) the date on which
the Corporation shall take a record of the holders of its Common Stock for the
purpose of entitling them to receive any such Convertible Securities, (B) the
date on which the Corporation shall enter into a firm contract for the issuance
of such Convertible Securities, and (C) the date of actual issuance of such
Convertible Securities. No adjustment of the number of shares of Common Stock
comprising a Stock Unit shall be made under this Section 8(f) upon the issuance
of any Convertible Securities which are issued pursuant to the exercise of any
warrants, options or other subscription or purchase rights therefor, if any such
adjustment shall previously have been made upon the issuance of such warrants,
options or other rights pursuant to Section 8(e).

         (g) Superseding Adjustment of Stock Unit. If, at any time after any
adjustment of the number of shares of Common Stock comprising a Stock Unit shall
have been made pursuant to the foregoing Section 8(e) or Section (f) on the
basis of the issuance of warrants, options or other rights or the issuance of
other Convertible Securities, or after any new adjustment of the number of
shares of Common Stock comprising a Stock Unit shall have been made pursuant to
this Section 8(g),

             (i) such warrants, options or rights or the right of conversion or
exchange in such other Convertible Securities shall expire, and a portion or all
of such warrants, options or rights, or the right of conversion or exchange in
respect of a portion of such other Convertible Securities, as the case may be,
shall not have been exercised, or

                                       15
<PAGE>   16

             (ii) the consideration per share for which Additional Shares of
Common Stock are issuable pursuant to such warrants, options or rights or the
terms of such other Convertible Securities, shall be increased solely by virtue
of provisions therein contained for an automatic increase in such consideration
per share upon the arrival of a specified date or the happening of a specified
event,

such previous adjustment shall be rescinded and annulled and the Additional
Shares of Common Stock which were deemed to have been issued by virtue of the
computation made in connection with the adjustment so rescinded and annulled
shall no longer be deemed to have been issued by virtue of such computation.
Thereupon, a recomputation shall be made of the effect of such warrants, options
or rights or other Convertible Securities on the basis of:

             (iii) treating the number of Additional Shares of Common Stock, if
any, theretofore actually issued or issuable pursuant to the previous exercise
of such warrants, options or rights or such right of conversion or exchange, as
having been issued on the date or dates of such issuance as determined for
purposes of such previous adjustment and for the consideration actually received
and receivable therefor, and

             (iv) treating any such warrants, options or rights or any such
other Convertible Securities which then remain outstanding as having been
granted or issued immediately after the time of such expiration or of such
increase of the consideration per share for which such Additional Shares of
Common Stock are issuable under such warrants, options or rights or other
Convertible Securities,

and, if and to the extent called for by the foregoing provisions of this Section
8 on the basis aforesaid, a new adjustment of the number of shares of Common
Stock comprising a Stock Unit shall be made, which new adjustment shall
supersede the previous adjustment so rescinded and annulled.

         (h) Other Provisions Applicable to Adjustments Under this Section 8.
The following provisions shall be applicable to the making of adjustments of the
number of shares of Common Stock comprising a Stock Unit hereinbefore provided
for in this Section 8:

             (i) Treasury Stock. The sale or other disposition of any issued
shares of Common Stock owned or held by or for the account of the Corporation
shall be deemed an issuance thereof for purposes of this Section 8.

             (ii) Computation of Consideration. To the extent that any
Additional Shares of Common Stock or any Convertible Securities or any warrants,
options or other rights to subscribe for or purchase any Additional Shares of
Common Stock or any Convertible Securities shall be issued solely for cash
consideration, the consideration received by the Corporation therefor shall be
deemed to be the amount of cash received by the Corporation therefor, or, if
such Additional Shares of Common Stock or Convertible Securities are offered by
the Corporation for subscription, the subscription price, or, if such Additional
Shares of Common Stock or Convertible Securities are sold to underwriters or
dealers for public offering without a subscription offering, the initial public
offering price, in any such case excluding any amounts paid or receivable for
accrued interest or accrued dividends and without deduction of any

                                       16
<PAGE>   17

compensation, discounts or expenses paid or incurred by the Corporation for and
in the underwriting of, or otherwise in connection with, the issue thereof. To
the extent that such issuance shall be for a consideration other than solely for
cash, then, except as herein otherwise expressly provided, the amount of such
consideration shall be deemed to be the fair value of such consideration at the
time of such issuance as determined pursuant to the Valuation Procedure. The
consideration for any Additional Shares of Common Stock issuable pursuant to any
warrants, options or other rights to subscribe for or purchase the same shall be
the consideration received or receivable by the Corporation for issuing such
warrant, options or other rights, plus the additional consideration payable to
the Corporation upon the exercise of such warrants, options or other rights. The
consideration for any Additional Shares of Common Stock issuable pursuant to the
terms of any Convertible Securities shall be the consideration received or
receivable by the Corporation for issuing any warrants, options or other rights
to subscribe for or purchase such Convertible Securities (if any), plus the
consideration paid or payable to the Corporation in respect of the subscription
for or purchase of such Convertible Securities, plus the additional
consideration, if any, payable to the Corporation upon the exercise of the right
of conversion or exchange in such Convertible Securities.

             (iii) When Adjustments To Be Made. The adjustments required by the
preceding Sections 8(b) through (h) inclusive shall be made whenever and as
often as any specified event requiring an adjustment shall occur. For the
purpose of any adjustment, any specified event shall be deemed to have occurred
at the close of business on the date of its occurrence.

             (iv) Fractional Interests. In computing adjustments under this
Section 8, fractional interests in Common Stock shall be taken into account to
the nearest 1/100th of a share.

             (v) When Adjustment Not Required. If the Corporation shall take a
record of the holders of its Common Stock for the purpose of entitling them to
receive a dividend or distribution or subscription or purchase rights and shall,
thereafter and before the distribution thereof to shareholders, legally abandon
its plan to pay or deliver such dividend, distribution, subscription or purchase
rights, then thereafter no adjustment shall be required by reason of the taking
of such record and any such adjustment previously made in respect thereof shall
be rescinded and annulled.

         (i) Merger, Consolidation or Disposition of Assets. In case the
Corporation shall merge or consolidate into another corporation, or shall sell,
transfer or otherwise dispose of all or substantially all of its property,
assets or business to another corporation and pursuant to the terms of such
merger, consolidation or disposition, shares of common stock of the successor or
acquiring corporation are to be received by or distributed to the holders of
Common Stock of the Corporation, then each holder of Series B Preferred Stock
shall have the right thereafter to receive Stock Units each comprising the
number of shares of common stock of the successor or acquiring corporation
receivable upon or as a result of such merger, consolidation or disposition of
assets by a holder of the number of shares of Common Stock comprising a Stock
Unit immediately prior to such event. If, pursuant to the terms of such merger,
consolidation or disposition of assets, any cash, shares of stock or other
securities or property of any nature whatsoever (including warrants, options or
other subscription or purchase rights) are to be

                                       17
<PAGE>   18

received by or distributed to the holders of Common Stock of the Corporation in
addition to common stock of the successor or acquiring corporation, there shall
be an adjustment in the number of shares of Common Stock thereafter comprising a
Stock Unit to that number determined by multiplying the number of shares of
Common Stock comprising a Stock Unit immediately prior to such adjustment by a
fraction (x) the numerator of which shall be the Current Market Price per share
of Common Stock at the date of such merger, consolidation or disposition, and
(y) the denominator of which shall be such Current Market Price per share minus
the portion applicable to one share of Common Stock of any cash so distributed
and of the fair value of any and all such shares of stock, securities or other
property. Such fair value shall be determined pursuant to the Valuation
Procedure. In case of any such merger, consolidation or disposition of assets,
the successor or acquiring corporation shall expressly assume the due and
punctual observance and performance of each and every covenant and condition
contained herein to be performed and observed by the Corporation and all of the
obligations and liabilities hereunder and thereunder, subject to such
modification as shall be necessary to provide for adjustments of Stock Units
which shall be as nearly equivalent as practicable to the adjustments provided
for in this Section 8. For the purposes of this Section 8 "common stock of the
successor or acquiring corporation" shall include stock of such corporation of
any class which is not preferred as to dividends or assets over any other class
of stock of such corporation and which is not subject to redemption. The
foregoing provisions of this Section 8(i) shall similarly apply to successive
mergers, consolidations or dispositions of assets.

         (j) Other Action Affecting Common Stock. In case at any time or from
time to time the Corporation shall take any action affecting its Common Stock,
other than an action described in any of the foregoing Sections 8(b) to Section
8(i), inclusive, of this Section 8 and the actions described in clauses (i)
through (xiv) of the definition of Additional Shares of Common Stock, then,
unless in the reasonable opinion of the Board of Directors of the Corporation
such action will not have a materially adverse effect upon the rights of the
holders of the Series B Preferred Stock, the number of shares of Common Stock or
other stock comprising a Stock Unit, or the Conversion Price thereof, shall be
adjusted in such manner and at such time as the Board of Directors of the
Corporation may in good faith determine to be equitable in the circumstances.

         (k) No Adjustments for Certain Transactions. Notwithstanding anything
to the contrary contained herein, the number of shares of Common Stock
comprising a Stock Unit and the Current Conversion Price per Stock Unit shall
not be adjusted, nor be subject to adjustment, on account of the granting of any
rights under a phantom stock plan, stock appreciation rights plan or other
deferred compensation plan to officers, directors or employees of the
Corporation or its affiliates, if (i) no shares of Common Stock are issued or
required to be issued under any such plan and (ii) the only consideration paid
or payable to any participant in such plan is cash.

9.       Notice to Holders of Series B Preferred Stock.

         (a) Notice of Adjustment of Stock Unit or Current Conversion Price.
Whenever the number of shares of Common Stock comprising a Stock Unit or the
Current Conversion Price per Stock Unit shall be adjusted pursuant to Section 8,
the Corporation shall forthwith obtain a certificate signed by the president of
the Corporation and the principal financial officer of the Corporation, setting
forth, in reasonable detail, the event requiring the adjustment and the method
by which such adjustment was calculated (including a statement of the fair
value, as

                                       18
<PAGE>   19

determined by the Board of Directors of the Corporation, of any evidences of
indebtedness, shares of stock, other securities or property or warrants, options
or other subscription or purchase rights referred to in Section 8(c), Section
8(h)(ii) or Section 8(i)) and specifying the number of shares of Common Stock
comprising a Stock Unit and (if such adjustment was made pursuant to Section
8(i) or Section 8(j)) describing the number and kind of any other shares of
stock comprising a Stock Unit, and any change in the Current Conversion Price
thereof after giving effect to such adjustment or change. The Corporation shall
promptly, and in any case within 10 days after the making of such adjustment,
cause a signed copy of such certificate to be delivered to each holder of Series
B Preferred Stock. The Corporation shall keep at its office or agency copies of
all such certificates and cause the same to be available for inspection at said
office during normal business hours by any holder of Series B Preferred Stock or
any prospective purchaser of Series B Preferred Stock designated by a holder.

         (b) Notice of Certain Corporate Action. In case the Corporation shall
propose (i) to pay any dividend payable in cash or in stock of any class to the
holders of its Common Stock or to make any other distribution to the holders of
its Common Stock, or (ii) to offer to the holders of its Common Stock rights to
subscribe for or to purchase any Additional Shares of Common Stock or shares of
stock of any class or any other securities, rights or options, or (iii) to
effect any reclassification of its Common Stock (other than a reclassification
involving only the subdivision or combination of outstanding shares of Common
Stock), or (iv) to effect any capital reorganization, or (v) to effect any
consolidation, merger or sale, change to the Corporation's charter or bylaws,
transfer or other disposition of all or substantially all of its property,
assets or business, or (vi) to effect the liquidation, dissolution or winding up
of the Corporation, then in each such case, the Corporation shall give to each
holder of Series B Preferred Stock, a notice, certified by the president of the
Corporation and the principal financial officer of the Corporation, of such
proposed action, which shall specify the date on which a record is to be taken
for the purposes of such stock dividend, distribution or rights, or the date on
which such reclassification, reorganization, consolidation, merger, sale, change
to the Corporation's charter or bylaws, transfer, disposition, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of Common Stock, if any such date is to be fixed, and
shall also set forth such facts with respect thereto as shall be reasonably
necessary to indicate the effect of such action on the Common Stock and the
number and kind of any other shares of stock which will comprise a Stock Unit,
and the Current Conversion Price thereof, after giving effect to any adjustment
which will be required as a result of such action. Such notice shall be so given
in the case of any action covered by clause (i) or (ii) above at least twenty
days prior to the record date for determining holders of the Common Stock for
purposes of such action, and in the case of any other such action, at least
thirty days prior to the date of the taking of such proposed action or the date
of participation therein by the holders of Common Stock, whichever shall be the
earlier.

10.      No Impairment. Other than in connection with the amendment of its
Articles of Incorporation approved by the requisite number of stockholders, the
Corporation will not, through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Corporation but will at all times in good
faith assist in the carrying out of all the provisions of this Certificate and
in the taking of all action as may be necessary or appropriate in order to
protect the conversion rights of the holders of the

                                       19
<PAGE>   20

Series B Preferred Stock against impairment. Without limiting the generality of
the foregoing, the Corporation (i) will not permit the par value of any shares
of stock at the time receivable upon the conversion of the Series B Preferred
Stock to exceed the Current Conversion Price then in effect, (ii) will take all
such action as may be necessary or appropriate in order that the corporation may
validly and legally issue fully paid non-assessable shares of stock on the
conversion of the Series B Preferred Stock, and (iii) will not issue any
Additional Shares of Common Stock or Convertible Securities or take any action
which results in any adjustment of the Current Conversion Price or the number of
shares comprising a Stock Unit if the total number of shares of Common Stock
issuable after such issuance or action upon the conversion or payment of all
outstanding dividends on, all of the then outstanding shares of Series B
Preferred Stock will exceed the total number of shares of Common Stock then
authorized by the Corporation's Articles of Incorporation and available for the
purpose of issue upon such conversion or payment of such dividend.

                                       20

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