Document:

<PAGE>   1
                                                                   Exhibit 10.14

                    ENGINEER, PROCURE AND CONSTRUCT CONTRACT

                                     BETWEEN

                           LEVEL 3 COMMUNICATIONS, LLC

                                       AND

                      NATIONAL NETWORK TECHNOLOGIES, LLC.,

                         CONTRACT NUMBER EAST 21-NE-EPC
<PAGE>   2
                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                                             <C>
RECITALS                                                                                                          1

1        DEFINITIONS; INTERPRETATION                                                                              1

2        PROJECT                                                                                                  8

3        CONTRACTOR OBLIGATIONS                                                                                   9

4        INFORMATION SUPPLIED TO CONTRACTOR AND DISCLAIMER; REPRESENTATIONS AND WARRANTIES                       15

5        ENFORCEABILITY; LOSS OR DAMAGE; TITLE                                                                   15

6        PAYMENT                                                                                                 17

         Appendix "A" Description of Project

         Appendix "B" Not Used

         Appendix "C" Confidentiality Agreement

         Appendix "D" Award Fee Computation

         Appendix "E" Program Management

         Appendix "F" Safety

         Appendix "G" Quality

         Appendix "H" Cost

         Appendix "I" Schedule

         Appendix "J" Response Times for Owner's Approval

         Appendix "K" TBD Travel and Assignment Policy

         Appendix "L" Charge Schedule
</TABLE>
<PAGE>   3
                    ENGINEER, PROCURE AND CONSTRUCT CONTRACT

THIS ENGINEER, PROCURE AND CONSTRUCT CONTRACT, is dated as of the ____ day of
__________, 1998 the ("Effective Date"), by and between Level 3 Communications,
LLC, located at 14023 Denver West Parkway, Golden, Colorado 80401, telephone
number: (303) 215-8500, a Delaware limited liability corporation ("Owner"), and
National Network Technologies, LLC., located at 26 Broadway, Suite 400, New
York, New York 10004, telephone number: (212) 847-7770, federal tax I.D.:
13-3990223, a Delaware corporation ("Contractor").

                                    RECITALS

A.       Owner desires to have constructed numerous multi-conduit fibre optic
         cable systems and other facilities (each, a "Network") in certain
         geographical areas.

B.       Owner was procured or will procure rights of way, or other necessary
         interests in real property, for the permanent placement of each
         Network.

C.       Owner desires to engage and the Contractor desires to be engaged to
         serve as the program manager which will provide program management,
         design, engineering, procurement and construction services for each
         Network described herein (the "Project", as hereinafter defined).

NOW, THEREFORE, in consideration of the sums to be paid to Contractor by Owner,
the foregoing premises and the covenants and agreements set forth herein, the
parties hereby agree as follows:

1        DEFINITIONS; INTERPRETATION

         1.1      Definitions. As used herein with capitalization of the initial
                  letter of each word, the following terms shall have the
                  following respective meanings:

                  1.1.1    "Additional Rights of Way" shall have the meaning
                           assigned to such term in Section 10.1.2.2.

                  1.1.2    "Award Fee" shall have the meaning assigned to such
                           term in Section 6.3.2.

                  1.1.3    "Base Fee" shall have the meaning assigned to such
                           term in Section 6.12.

                  1.1.4    "Business Day" shall mean any day on which commercial
                           banks are not authorized or required to be closed in
                           Denver, Colorado.

                  1.1.5    "Change in Law" shall mean any controlling change in
                           the judicial or administrative interpretation of, or
                           adoption of, any Governmental Rule,
                                                                    Page 1 of 72
<PAGE>   4
                           which is inconsistent with any Governmental Rule in
                           effect on the execution date of this Contract.

                  1.1.6    "Change in the Work Form" shall have the meaning
                           assigned to such term in Section 11.1.2.3.

                  1.1.7    "Change Order" shall mean a written order to
                           Contractor issued and signed by Owner authorizing an
                           addition to, deletion from, suspension of or other
                           modification to the Work, the Warranties or any other
                           requirement of this Contract.

                  1.1.8    "Claim" shall mean any claim by any Subcontractor or
                           Vendor of Contractor for any compensation due or
                           alleged to be due in connection with the Work.

                  1.1.9    "Completion Date" shall refer to the date specified
                           in the relevant Construction Schedule for Substantial
                           Completion of the Network or Segment.

                  1.1.10   "Construction Certificate" shall mean a Construction
                           Certificate delivered by Contractor in accordance
                           with Section 6.2.2 and duly completed and signed by
                           Contractor.

                  1.1.11   "Construction Schedule" shall mean a schedule,
                           prepared by the Contractor and for which Owner's
                           Approval has been obtained, that specifies dates and
                           milestones for the timely completion of each Network.

                  1.1.12   "Construction Work" shall refer to all Work other
                           than engineering, program management, procurement and
                           inspection Work.

                  1.1.13   "Contract" shall have the meaning assigned to such
                           term in Section 1.3.

                  1.1.14   "Contract Budget" shall have the meaning assigned to
                           such term in Section 3.2.1.

                  1.1.15   "Contract Price" shall have the meaning assigned to
                           such term in Section 6.1.

                  1.1.16   "Contractor" shall have the meaning assigned to such
                           term in the introductory paragraph of this Contract.

                  1.1.17   "Cost of Work" shall have the meaning assigned to
                           such term in Section 6.

                                                                    Page 2 of 72
<PAGE>   5
                  1.1.18   "Coverages" shall have the meaning assigned to such
                           term in Section 15.2.

                  1.1.19   "CPM" shall have the meaning assigned to such term in
                           Section 9.1.

                  1.1.20   "Day" shall mean a calendar day.

                  1.1.21   "Documents" shall mean, without limitation, all
                           written, recorded, graphic or printed matter, in
                           whatever form, including all originals, copies, and
                           drafts including without limitation, all letters,
                           e-mails, telegrams, memoranda, statements, drawings,
                           graphs, photographs, reports, notes, diaries, charts,
                           work papers, recordings, and computer printouts, and
                           all data compilations from which information can be
                           obtained or translated through detection devices into
                           reasonably usable form.

                  1.1.22   "Drawings" shall mean all graphic and pictorial
                           descriptions of the Work that must be accomplished in
                           accordance with this Contract showing the design,
                           location and dimensions of the Work including plans,
                           elevations, sections, details and diagrams.

                  1.1.23   "Effective Date" shall have the meaning assigned to
                           such term in the introductory paragraph of this
                           Contract.

                  1.1.24   "Event of Default" shall have the meaning assigned to
                           such term in Section 17.

                  1.1.25   "Final Acceptance" shall have the meaning assigned to
                           such term in Section 20.3.2.

                  1.1.26   "Final Acceptance Date" shall mean the date on which
                           Final Acceptance of all Work related to the Network
                           or Segment thereof and shall have occurred in
                           accordance with Section 20.3.

                  1.1.27   "Force Majeure Event" shall mean any cause beyond the
                           control and not due to an act or omission of the
                           party claiming the existence of the Force Majeure
                           Event, and which could not have been avoided by due
                           diligence and use of reasonable efforts by such
                           party, as a result of which it is not possible for
                           such party to avoid a delay in the performance of its
                           obligations under this Contract or to avoid an
                           increase in the cost to such party of the performance
                           of its obligations under this Contract including:

                           1.1.27.1         an earthquake, fire, epidemic,
                                            blockade, rebellion, war, riot,
                                            civil disturbance, sabotage,
                                            explosion, act of God, act of public
                                            enemy or other similar occurrence;

                                                                    Page 3 of 72
<PAGE>   6
                           1.1.27.2         a strike, labor dispute, work
                                            slowdown, work stoppage, secondary
                                            boycott, walkout or other similar
                                            occurrence;

                           1.1.27.3         Owner interference or failure of
                                            Owner to perform its obligations
                                            hereunder;

                           1.1.27.4         an expropriation, confiscation or
                                            condemnation of all or any portion
                                            of the Network or the Site; or

                           1.1.27.5         a Change in Law.

                  1.1.28   "G&A Fee" shall have the meaning assigned to such
                           term in Section 6.

                  1.1.29   "Governmental Approval" shall mean any authorization,
                           consent, approval, order, action, license, lease,
                           ruling, permit, certification, exemption, filing or
                           registration by or with any Governmental Person.

                  1.1.30   "Governmental Person" shall mean any federal, state,
                           local or foreign government, any political
                           subdivision or any governmental, quasi-governmental,
                           judicial, public or statutory instrumentality,
                           administrative agency, body or entity.

                  1.1.31   "Governmental Rule" shall mean any statute, law,
                           regulation, ordinance, rule, license, permit,
                           judgment, order, decree, concession, grant,
                           franchise, agreement, directive, guideline, policy
                           requirement, or other governmental restriction or any
                           similar form of decision of or determination by, or
                           any interpretation or administration of any of the
                           foregoing by, any Governmental Person, whether now or
                           hereafter in effect.

                  1.1.32   "Hazardous Substance" shall mean any "hazardous
                           substances" as defined in the Comprehensive
                           Environmental Response, Compensation and Liability
                           Act of 1980, as amended by the Superfund Amendments
                           and Reauthorization Act of 1986, 42 U.S.C. Section
                           9601 et seq., as amended, and any "hazardous waste"
                           as defined in the Resource Conservation and Recovery
                           Act of 1976, 42 U.S.C. Section 6901 et seq., as
                           amended, any regulated substance under subtitle 1 of
                           The Resource Conservation and Recovery Act of 1976 or
                           the Colorado Underground Storage Tank Act or any
                           substance the presence of which requires
                           investigation, remediation or other action under any
                           federal or state law, regulation or order. Hazardous
                           Substance does not include any of the foregoing
                           described substances which is or has been introduced
                           by Contractor, Subcontractors, Vendors, or anyone for
                           whom any of them may be liable.

                                                                    Page 4 of 72
<PAGE>   7
                  1.1.33   "Implementation Plan" shall have the meaning assigned
                           to such term in Section 3.1.1.

                  1.1.34   "Initial Rights of Way" shall have the meaning
                           assigned to such term in Section 10.1.2.1.

                  1.1.35   "Network" shall have the meaning assigned to such
                           term in Recital A, as more specifically described in
                           Appendix "A", as may be modified from time to time.

                  1.1.36   "Notice" shall mean a written communication between
                           the parties in substantial compliance with the
                           requirements of Section 22.8.

                  1.1.37   "Notice of Termination" shall have the meaning
                           assigned to such term in Section 12.1.

                  1.1.38   "Notice to Proceed" shall mean a Notice issued by
                           Owner to Contractor to commence the Work or any
                           portion thereof.

                  1.1.39   "OCIP" shall have the meaning assigned to such term
                           in Section 15.1.

                  1.1.40   "Oversight Engineer" shall mean such consultant or
                           consultants as Owner may engage to review the design
                           Documents, Specifications and other Documents
                           prepared by Contractor, to make periodic inspections
                           of the Work and the Project, to review Change Orders
                           and to render advice to and prepare reports for Owner
                           on such matters as Owner may from time to time
                           request, the identity of which Oversight Engineer(s)
                           shall be the subject of a Notice by Owner to
                           Contractor. An Oversight Engineer may, at Owner's
                           option, be an employee or independent contractor of
                           Owner.

                  1.1.41   "Owner" shall have the meaning assigned to such term
                           in the introductory paragraph of this Contract.

                  1.1.42   "Owner-Supplied Items" shall mean those materials,
                           equipment or other items supplied by Owner for use or
                           incorporation in the Work, identified in Section 8.

                  1.1.43   "Owner's Approval" shall mean, with respect to
                           information, Documents, Drawings, Specifications, or
                           other items to be provided by the Contractor to the
                           Owner under this Contract, that Owner has, in Owner's
                           sole discretion, approved such item. When Owner's
                           Approval is specified for an item, Contractor shall
                           provide the same to Owner in such quantities and
                           format as specified by Owner, and in sufficient time,
                           in accordance with

                                                                    Page 5 of 72
<PAGE>   8
                           this Contract, to enable Owner or the Oversight
                           Engineer, as required, to review the same and respond
                           to Contractor. In the event Owner or Oversight
                           Engineer, as appropriate, does not approve an item
                           submitted by Contractor for Owner's Approval on first
                           or subsequent submission, Contractor shall revise the
                           same and resubmit until Owner's Approval is obtained.
                           Contractor shall not be entitled to an extension of
                           the Contract Time for delays in receiving Owner's
                           Approval where Contract has failed to comply with the
                           requirements for Owner's Approval. Owner's Approval
                           shall not constitute acceptance of Work not in
                           accordance with the Contract, nor shall it constitute
                           a representation or certification that the submittal
                           is accurate or adequate, or that the Work described
                           therein will be sufficient to satisfy the
                           requirements of the Contract. Owner's Approval shall
                           be effective only if in writing; verbal approval
                           shall not constitute Owner's Approval. Unless
                           otherwise specified, anticipated response times for
                           items submitted for Owner's Approval are set forth in
                           Appendix "J".

                  1.1.44   "Partial Acceptance" shall have the meaning assigned
                           to such term in Section 20.2.

                  1.1.45   "Payment Date" shall have the meaning assigned to
                           such term in Section 6.2.3.

                  1.1.46   "Person" shall mean individual, corporation, company,
                           voluntary association, partnership, trust,
                           unincorporated organization or Governmental Person.

                  1.1.47   "Preliminary Estimate" shall have the meaning
                           assigned to such term in Section 3.2.1.

                  1.1.48   "Project" shall mean the total design, engineering,
                           procurement and construction of all the Networks,
                           including appurtenances thereto such as manholes,
                           handholes, and end user sites, as described more
                           fully in Appendix "A".

                  1.1.49   "Project Headquarters" shall mean the location of any
                           of Contractor's central office task force.

                  1.1.50   "Project Manager" shall man the project manager
                           designed by Contractor pursuant to Section 3.2.10.

                  1.1.51   "Punchlist" shall mean the list of Work, which is
                           limited to minor incidental items of work necessary
                           to correct imperfections which have no adverse effect
                           on the safety or operability of the Network or
                           Segment,

                                                                    Page 6 of 72
<PAGE>   9
                           which remains to be completed after achievement of
                           Substantial Completion of the Network or Segment.

                  1.1.52   "Quality Control Plan" or "QCP" shall have the
                           meaning assigned to such term in Section 9.4.1.

                  1.1.53   "Rights of Way" shall man those geographic areas
                           which Owner provides to the Contractor for the
                           permanent installation of the Project, regardless of
                           whether Owner's interest therein is fee title,
                           easement or otherwise, and includes Initial Rights of
                           Way and Additional Rights of Way.

                  1.1.54   "Safety Program" shall have the meaning assigned to
                           such term in Section 3.3.1.

                  1.1.55   "Site" shall mean those areas designed in writing by
                           Owner for performance of the Work and such additional
                           areas as may, from time to time, be designated in
                           writing by Owner for Contractor's use hereunder.

                  1.1.56   "Specifications" shall mean the written requirements
                           for materials, equipment, construction systems,
                           standards and workmanship for the Work, and
                           performance of related services, all in accordance
                           with the Contract, to be prepared and furnished by
                           Contractor. Contractor must obtain the Owner's
                           Approval of Specifications.

                  1.1.57   "Subcontractor" shall mean any Person with whom
                           Contractor has entered into any subcontract to
                           perform any part of the Work, or provide any
                           materials, equipment, supplies or services on behalf
                           of Contractor (and any other Person with whom any
                           Subcontractor has further subcontracted any part of
                           the Work).

                  1.1.58   "Substantial Completion" shall have the meaning
                           assigned to such term in Section 20.1.3.

                  1.1.59   "Surety" shall mean each Person executing a payment
                           and performance bond with a Subcontractor, which
                           Person must be acceptable to Owner and listed in the
                           National Registry.

                  1.1.60   "Vendor" shall mean any Person not performing Work at
                           the Site that supplies machinery, equipment,
                           materials or systems to Contractor or any
                           Subcontractor in connection with the performance of
                           the Work and completion of the Project.

                  1.1.61   "Warranties" shall mean the warranties of Contractor
                           under Section 21.

                                                                    Page 7 of 72
<PAGE>   10
                  1.1.62   "WBS" shall have the meaning assigned to such term in
                           Section 9.1.1.

                  1.1.63   "Work" shall mean all design, engineering,
                           procurement, program management, construction, labor,
                           supervision, testing, and other services, equipment,
                           systems and materials provided or to be provided by
                           Contractor necessary to achieve Final Acceptance of
                           the Project and satisfy the obligations of this
                           Contract.

         1.2      Interpretation. In this Contract, the singular includes the
                  plural and the plural the singular; references to statute or
                  regulations are to be construed as including all statutory or
                  regulatory provisions consolidating, amending or replacing the
                  statute or regulation referred to; references to "writing"
                  include printing, e-mail, typing, lithography and other means
                  of reproducing words in a tangible visible form; the words
                  "including," "includes" and "include" shall be deemed to be
                  followed by the words "without limitation" or words of similar
                  import; references to articles, sections (or subdivisions of
                  sections), exhibits, annexes, appendices, or schedules shall
                  be construed to be to this Contract unless otherwise
                  indicated; references to agreements, exhibits, appendices,
                  hereto and other contractual instruments shall, unless
                  otherwise indicated, be deemed to include all subsequent
                  amendments and other modifications to such instruments, but
                  only to the extent such amendments and other modifications are
                  not prohibited by the terms of this Contract; words not
                  otherwise defined which have well-known technical or
                  construction industry meanings, unless the context otherwise
                  requires, are used in accordance with such recognized
                  meanings; and references to Persons include their respective
                  permitted successors and assigns, and, in the case of
                  Governmental Persons, Persons succeeding to their respective
                  functions and capacities. References to a section of the
                  Contract include all subsections or parts thereof unless
                  otherwise specified.

         1.3      The Contract. This Contract shall include this Engineer,
                  Procure and Construct Contract by and between Owner and
                  Contractor and all exhibits, appendices, attachments,
                  amendments, supplements and modifications hereto and all
                  Change Orders (collectively, this "Contract"). This Contract
                  shall not be construed to create a contractual relationship of
                  any kind between Owner and a Subcontractor or Vendor or any
                  other Person other than Contractor.

2        PROJECT

         2.1      The Project is more fully described in Appendix "A". Owner
                  will further define and communicate to the Contractor Work of
                  the Project including:

                  2.1.1    objectives for the Project;

                  2.1.2    Network infrastructure design criteria;

                                                                    Page 8 of 72
<PAGE>   11
                  2.1.3    environmental and cultural resource policy,
                           guidelines, reporting protocols, and permits
                           conditions checklists;

                  2.1.4    tax payment, cost accounting and insurance policies
                           and procedures.

         2.2      Owner may change the Work at any time.

3        CONTRACTOR OBLIGATIONS

         3.1      Design and Construction. Contractor's Work shall include the
                  following:

                  3.1.1    Within thirty (30) Days of execution of the Contract,
                           Contractor shall develop and submit for Owner's
                           Approval a plan for the implementation
                           ("Implementation Plan") of the design, engineering,
                           procurement and construction of the Project as
                           required to achieve Final Acceptance of the entire
                           Project (including all Segments) and all Work in
                           accordance with this Contract.

                  3.1.2    Contractor shall provide, for Owner's Approval,
                           complete with accurate Drawings and Specifications
                           for the Project that fulfill the requirements of the
                           Contract and any requirements specified by Owner and
                           that are in accordance with all Governmental Rules
                           and industry standards.

                  3.1.3    Contractor shall make site visits on Rights of Way
                           and shall design each Network route endeavoring to
                           provide the optimum route by taking into
                           consideration environmental concerns and sub-grade
                           obstacles, as well as ease of construction,
                           endeavoring to ensure cost effectiveness. Contractor
                           shall then provide Drawings that adequately and
                           accurately depict the Network route for Owner's
                           Approval and in a manner to subdivide the Project
                           into manageable Segments of Work. Contractor shall
                           provide such Drawings in a sequence to promote the
                           earliest start of construction in priority areas.

                  3.1.4    Except for Owner-Supplied Items, Contractor shall
                           furnish, be responsible for and pay (subject to the
                           reimbursement provisions of this Contract) the cost
                           of all labor, materials, tools, equipment, insurance,
                           taxes, supervision and all other incidentals
                           necessary perform the Work and achieve Final
                           Acceptance of the entire Project in accordance with
                           the provisions of this Contract.

                  3.1.5    Contractor shall execute the Work in accordance with
                           the Construction Schedules and all Governmental
                           Approvals, using methods and equipment

                                                                    Page 9 of 72
<PAGE>   12
                           that are approved by the Owner and are prudent
                           engineering and construction practices and
                           operations.

                  3.1.6    Contractor shall comply in all respects with all
                           applicable permits, Governmental Rules, Government
                           Approvals or requirements of parties with interests
                           in the Rights of Way and pay at Contractor's own
                           expense, all charges, fees, taxes, damages, fines,
                           and penalties which may arise because of
                           non-compliance by Contractor, Subcontractors, Vendors
                           or other agents or employees of Contractor.

                  3.1.7    Contractor shall remove from the Site and maintain
                           the Site free of waste material and rubbish, clear
                           the Site of temporary structures, surplus material,
                           equipment and tools prior to the Final Acceptance
                           Date.

                  3.1.8    Contractor shall be solely responsible for and have
                           control over construction means, methods, techniques,
                           sequences, and procedures and for coordinating all
                           portions of the Work under this Contract. Contractor
                           shall evaluate and develop construction methods that
                           effect the efficient and thorough performance of the
                           Work, minimizing float in the Construction Schedule,
                           and reducing the Cost of the Work.

                  3.1.9    Contractor shall be responsible to Owner for acts and
                           omissions of Contractor's employees, Subcontractors,
                           Vendors and their agents and employees, and other
                           Persons performing portions of the Work under a
                           contract with Contractor.

                  3.1.10   Contractor shall not be relieved of obligations to
                           perform the Work in accordance with this Contract by
                           tests, inspections, or approvals performed by persons
                           other than Contractor.

                  3.1.11   Contractor shall not self-perform any portion of the
                           Construction Work without Owner's Approval.

                  3.1.12   To the extent Contractor deems necessary in
                           accordance with prudent engineering practices,
                           Contractor shall inspect the Site and surrounding
                           locations, including surface and subsurface
                           conditions for performing its obligations under this
                           Contract, and become familiar with the physical
                           requirements of the Work and hereby accepts them for
                           such performance.

         3.2      Program Management.

                  3.2.1    Within thirty (30) Days of issuance of a Notice to
                           Proceed with respect to a Network or portion thereof,
                           Contractor shall submit a Preliminary

                                                                   Page 10 of 72
<PAGE>   13
                           Estimate of the Cost of the Work for such Network
                           ("Preliminary Estimate") for Owner's Approval. Upon
                           issuance of Owner's Approval, the Preliminary
                           Estimate will become the "Contract Budget", which
                           will be used as a tool for measurement of
                           Contractor's performance.

                  3.2.2    Within thirty (30) Days issuance of a Notice to
                           Proceed with respect to a Network or portion thereof,
                           Contractor shall establish an aggressive but
                           achievable Construction Schedule for such Work for
                           Owner's Approval. The time stated in a Construction
                           Schedule in which Contractor agrees to achieve
                           Substantial Completion of the Work or any portion
                           thereof will be reasonable, adequate and sufficient.
                           On a monthly basis, Contractor shall prepare and
                           submit updates on schedules, budgets, forecasts and
                           variance reports that accurately portray the
                           Project's progress and budget financial standing in a
                           format that is acceptable to Owner. At Owner's sole
                           discretion, more frequent updates may be required
                           from time to time.

                  3.2.3    Contractor shall utilize an Internet based web page
                           reporting system provided by Owner that will contain
                           all Project Documents, Drawings, schedules and
                           reports. This system shall be developed such in a
                           manner that upon completion of the Project, it will
                           serve as the permanent archive for Project records
                           and as-built Drawings to be utilized by Owner's
                           operations and maintenance personnel.

                  3.2.4    Contractor shall, with the full cooperation of the
                           Owner, obtain, furnish, be responsible for, pay the
                           cost of and maintain in full force and effect all
                           Governmental Approvals required under applicable
                           Governmental Rules in connection with the execution,
                           performance and obligations as contemplated by this
                           Contract. Contractor shall furnish Owner a written
                           list of all Governmental Approvals required for
                           performance of the Work and the proper completion of
                           the Project and clearly identify the type of
                           Governmental Approvals that must be obtained before
                           applicable Work on any particular Network or Segment
                           can be started. The Work can and shall be performed
                           in conformity with all relevant building codes,
                           Governmental Approvals, Governmental Rules and this
                           Contract.

                  3.2.5    Contractor shall develop and implement a Quality
                           Control Plan that ensures the design of a lasting and
                           durable Network including verification, testing and
                           documentation of the design, materials and
                           installation of the Network in accordance with
                           Section 9.4.

                  3.2.6    Contractor shall develop and implement a material
                           control and purchasing plan incorporating the
                           logistics necessary for the distribution of all
                           Owner-Supplied Items and Contractor-furnished
                           materials, equipment and

                                                                   Page 11 of 72
<PAGE>   14
                           construction equipment and including inspection,
                           expediting, shipping, unloading, receiving, customs
                           clearance and claims in accordance with the
                           Construction Schedule. The material control systems
                           shall be capable of populating the Network inventory
                           system.

                  3.2.7    Contractor shall provide to Owner, on a monthly
                           basis, a list of all Subcontractors, Vendors and
                           agents of Contractor, including all relevant contact
                           information, and provide timely advice to Owner
                           concerning the status of negotiations with
                           Subcontractors and Vendors concerning any suspension
                           or termination charges related to any major component
                           of the Work. At Owner's sole discretion more frequent
                           updates may be required from time to time.

                  3.2.8    Contractor shall obtain, to the extent permitted by
                           law, waivers of liens and Claims from all
                           Subcontractors, Vendors and suppliers as of the
                           execution of each agreement with each such Person,
                           and in each case on a form approved by Owner.

                  3.2.9    Contractor shall prepare and provide to Owner final
                           geotechnical reports, including the performance of
                           all inspections, field and Site explorations and
                           testing work related thereto prior to submittal of
                           final design documents, and update the reports to
                           reflect the as-built condition of the Work.

                  3.2.10   Contractor shall designate a Project Manager,
                           acceptable to Owner, who will have full
                           responsibility for the execution of the Work and will
                           act as a single point of contact in all matters on
                           behalf of Contractor. Contractor shall not change the
                           Project Manager or any other key member of
                           Contractor's Project staff without the prior written
                           consent of Owner.

                  3.2.11   Contractor shall provide such assistance as is
                           reasonably requested by Owner in dealing with any
                           Governmental Person in any and all matters relating
                           to the Work and the Project.

                  3.2.12   Contract shall pay all taxes generated as a result of
                           the Work and administer taxing and cost accounting
                           plans furnished by Owner.

                  3.2.13   Contractor shall provide such data, reports,
                           certifications, and other documents or assistance as
                           may be reasonably requested by Owner in connection
                           with the financing of the Project provided, that the
                           provision of this information shall not in any manner
                           diminish Contractor's rights or obligations under any
                           other provision of this Contract.

                                                                   Page 12 of 72
<PAGE>   15
                  3.2.14   Contractor shall cooperate with Owner and Oversight
                           Engineer in the review of design of the Project, the
                           conduct of inspections, the development,
                           implementation and review of the Construction
                           Schedule and QCP, and other matters relating to the
                           Work.

                  3.2.15   Contractor shall allow Owner to audit all
                           documentation reasonably requested by Owner
                           pertaining to any dispute related to the Work.
                           Contractor shall not be required to provide access to
                           those records and documentation relating to any sum
                           which is not to be directly reimbursed as a Cost of
                           the Work, which are included in the G&A Fee or Base
                           Fee, or costs expressed as a percentage of other
                           costs.

                  3.2.16   Contract shall provide and maintain field offices at
                           locations to be determined by Owner, which facilities
                           shall be in place and operational prior to the
                           commencement of construction Work to be supervised
                           through such office. Such facilities shall be for the
                           exclusive use of the Project and shall contain copies
                           of all relevant Documents, Drawings and
                           Specifications necessary to perform the Work
                           supervised from that office.

                  3.2.17   Contractor shall maintain a Project headquarters
                           office where Contractor's Program Manager,
                           engineering manager, QCP manager and other Owner
                           approved key personnel maintain full-time offices,
                           and original Documents, Drawings and Specifications
                           are maintained.

                  3.2.18   Contractor shall, no later than execution of the
                           Contract, provide Owner an organization chart
                           identifying the Program Manager through Contractor's
                           chief executive officer, which shall also specify the
                           business address and work and home telephone numbers
                           for key personnel.

                  3.2.19   contractor shall provide as-built Drawings to Owner
                           within the time specified in the Contract.

         3.3      Safety.

                  3.3.1    Within thirty (30) Days of execution of the Contract,
                           Contractor shall submit a safety program ("Safety
                           Program") for Owner's Approval. Such program shall
                           include procedures that satisfy all Governmental
                           Rules and Governmental Approvals and Rights of Way
                           owner requirements on railroads, highways, roads and
                           other Sites where the Work will be performed.

                  3.3.2    The Safety Program procedures shall be maintained and
                           amended as necessary to comply with newly obtained
                           Rights of Way requirements.

                                                                   Page 13 of 72
<PAGE>   16
                  3.3.3    Contractor shall give Notices and Comply with all
                           applicable Governmental Rules or rules and
                           regulations of Rights of Way owners bearing on the
                           safety of persons and property and their protection
                           from damage, injury or loss, including providing any
                           safety training requirement by such Rights of Way
                           Owners.

                  3.3.4    Contractor shall be responsible for initiating,
                           maintaining and providing supervision of safety
                           precautions and programs in connection with the Work.

                  3.3.5    Contractor shall take all necessary precautions and
                           be solely responsible for the safety of, and shall
                           provide protection to prevent damage, injury or loss
                           to: (i) all employees of Contractor, its
                           Subcontractors and Vendors performing the Work and
                           other Persons who may be affected thereby; (ii) the
                           Work and materials and equipment to be incorporated
                           therein; and (iii) other property at or adjacent to
                           the Site that may be affected by the Work. Owner
                           shall have no liability or responsibility for safety
                           procedures.

                  3.3.6    Contractor shall provide, erect, and maintain
                           barricades, suitable and sufficient light, pavement
                           markings, signs and other traffic control devices as
                           required to protect the Work and safety of the
                           public. Barricades shall protect roadways closed to
                           traffic, and obstructions shall be illuminated during
                           hours of darkness. Signs shall be provided to control
                           and direct traffic. Contractor shall erect signs at
                           locations where operations may interfere with the use
                           of the road by traffic, and at all intermediate
                           points where the Work crosses or coincides with an
                           existing road. Signs shall be constructed, erected
                           and maintained as required to protect the Work and
                           the safety of the public. Barricades, warning signs,
                           lights, temporary signals, and other protective
                           devices shall conform with the latest revision of the
                           "Manual on Uniform Traffic Control Devices for
                           Streets and Highways" published by the Federal
                           Highway Administration and any local version or
                           supplement thereto.

                  3.3.7    Contractor shall observe all applicable rules and
                           regulations of federal, state, county and local
                           health officials. Contractor shall not require any
                           worker to work in surroundings or under conditions
                           that are unsanitary, hazardous or dangerous to health
                           or safety. Contractor shall conduct the Work to
                           minimize obstruction to traffic. Contractor shall
                           provide for the safety and convenience of the general
                           public and the residents along the Rights of Way and
                           the protection of person and property.

                                                                   Page 14 of 72
<PAGE>   17

4        INFORMATION SUPPLIED TO CONTRACTOR AND DISCLAIMER;
         REPRESENTATIONS AND WARRANTIES

         4.1      Information Supplied. Owner has made and will make available
                  to Contractor certain information acquired in the course of
                  planning for the Project.

         4.2      Reliance. Contractor may rely on information provided by
                  Owner, provided that Contractor shall verify any information
                  in accordance with the appropriate standard of care.

         4.3      Representations and Warranties. Contractor represents,
                  warrants and covenants that:

                  4.3.1    It has the required expertise, ability, skills and
                           capacity to, and shall, perform the Work in a manner
                           consistent with this Contract.

                  4.3.2    Contractor is a corporation duly organized, validly
                           existing and in good standing under the laws of the
                           State of Delaware and has all requisite power to own
                           its properties and assets and carry on its business
                           as now conducted or proposed to be conducted.
                           Contractor is duly qualified and registered to do
                           business in each state where the Work will be
                           performed.

                  4.3.3    The execution, delivery and performance of this
                           Contract and the consummation of the transactions
                           contemplated hereby have been duly authorized by all
                           necessary corporation action and do not and will not
                           (i) require any consent or approval of the board of
                           directors or any shareholders of Contractor or any
                           other Person that has not been obtained and each such
                           consent and approval that has been obtained is in
                           full force and effect or (ii) result in a breach of
                           or a default under the certificate of incorporation
                           or by-laws of Contractor or any indenture or loan or
                           credit agreement or other material agreement or
                           instrument to which Contractor is a party or by which
                           its properties and assets may be bound or affected.

                  4.3.4    This Contract constitutes the legal, valid, and
                           binding obligations of Contractor, enforceable in
                           accordance with its respective terms.

5        ENFORCEABILITY; LOSS OR DAMAGE; TITLE

         5.1      Enforceability. Notwithstanding any other provision set forth
                  in this Contract, performance by a Surety of any of the
                  obligations of Contractor shall not relieve Contractor of
                  liability for or breach of its obligations hereunder.

         5.2      Loss or Damage.

                                                                   Page 15 of 72
<PAGE>   18
                  5.2.1    Until the date of Substantial Completion of a Network
                           or a portion thereof, Contractor assumes full
                           responsibility for replacement or repair of any
                           damage to such Network including materials,
                           equipment, supplies and maintenance equipment
                           purchased for permanent installation or use during
                           construction, regardless of whether Owner has title
                           thereto under this Contract. Such costs to repair or
                           replace damage shall be a Cost of the Work, subject
                           to the following:

                           5.2.1.1  to the extent any such damage is not covered
                                    by insurance and is attributable to the
                                    negligence or willful misconduct of
                                    Contractor, it shall be at Contractor's sole
                                    cost and expense; and

                           5.2.1.2  to the extent any such damage is covered by
                                    insurance and is attributable to the
                                    negligence or willful misconduct of
                                    Contractor, any deductible shall be at
                                    Contractor's cost and expense.

                  From and after the date of the transfer of the care, custody,
                  and control of a Network or portion thereof, Owner shall
                  assume all risks of physical loss or damage thereto and Owner
                  will and shall cause its insurers to waive rights of
                  subrogation against Contractor for loss or damage to the Work
                  which may thereafter occur, provided that this shall not limit
                  Contractor's obligations under the Warranties.

                  5.2.2    Contractor shall ensure the safe delivery of all
                           materials, equipment, supplies and other items to the
                           Site and for maintaining, insuring, storing and
                           transporting Owner-Supplied Items.

         5.3      Title. Contractor warrants that it will own and have good and
                  marketable title to all materials, equipment, tools and
                  supplies furnished by it and its Subcontractors and Vendors
                  that become part of the Network or are purchased for Owner for
                  the operation, maintenance or repair thereof, free and clear
                  of all liens. Title to all of said materials, equipment, tools
                  and supplies which shall have been delivered to the Site shall
                  pass to Owner upon the sooner of (i) incorporation into the
                  Network or (ii) payment by Owner to Contractor under Section
                  6.2 of invoiced amounts pertaining thereto. Such transfer of
                  title shall in no way affect Owner's rights as set forth in
                  any other provision of this Contract. For the purpose of
                  protecting Owner's interest in all materials, equipment, tools
                  and supplies with respect to which title has passed to Owner
                  but which remain in possession of another party, Contractor
                  shall take or cause to be taken all commercially reasonably
                  steps necessary under the laws of the appropriate jurisdiction
                  to protect Owner's title and to protect Owner against claims
                  by other parties with respect thereto.

                                                                   Page 16 of 72
<PAGE>   19
6        PAYMENT

         6.1      Contract Price. As full compensation for the Work and all
                  other obligations to be performed by Contractor under this
                  Contract, Owner shall pay Contractor the Contract Price, which
                  consists of the following three components:

                  6.1.1    the Cost of the Work as detailed in Section 6.4;

                  6.1.2    the G&A Fee as described in Section 6.7;

                  6.1.3    an Award Fee as described in Section 6.8; and

                  6.1.4    a Base Fee as described in Section 6.12.

         6.2      Progress Payments. Payment to Contractor of the Contract Price
                  shall be made as follows:

                  6.2.1    By the tenth (10th) day of each month, Contractor
                           shall submit an invoice to Owner for the Cost of the
                           Work for Work performed during the preceding month
                           plus the G&A Fee and Base Fee. Such Contractor's
                           invoice shall clearly specify the Networks which it
                           relates to and provide documentation, as required by
                           Owner, to substantiate the Cost of the Work.
                           Contractor shall not invoice Owner for any amount,
                           such as retainage, which Contractor does not intend
                           to pay to Subcontractors or Vendors upon receipt.
                           Invoices shall be addressed to the following person
                           and location or shall be deemed invalid:

                                        Todd Christianson
                                        Contracts Manager
                                        Level 3 Communications, LLC
                                        14023 Denver West Parkway
                                        Golden, Colorado 80401

                           With each invoice, Contractor shall include a
                           conditional lien waiver for amounts payable to
                           Contractor (exclusive of Subcontractors' and Vendors'
                           costs).

                  6.2.2    Contractor shall submit with each such invoice a
                           Construction Certificate describing in sufficient
                           detail for independent verification, all approved
                           materials to which it holds title and which were
                           obtained in the preceding month, the Work that has
                           been invoiced, and stating that such Work has been
                           performed in compliance with the requirements of this
                           Contract. The Construction Certificate shall be in a
                           form acceptable to Owner. The

                                                                   Page 17 of 72
<PAGE>   20
                           invoice, Construction Certificate and supporting
                           documentation shall be subject to audit on demand by
                           Owner. Should any audit of such records discover the
                           cost invoiced is in excess of the actual cost,
                           Contract shall reduce the invoice in the amount of
                           five (5) times the audited excess amount and such
                           amount shall not be part of the Cost of Work and
                           shall be borne by the Contractor.

                  6.2.3    Owner shall promptly notify Contractor concerning any
                           invoiced amount which is in dispute and any Work
                           which Owner believes was not performed in accordance
                           with the Contract (all such Work and invoiced amounts
                           in respect thereof shall be deemed in dispute until
                           otherwise agreed). Owner shall pay Contractor the
                           amount then payable and not in dispute within fifteen
                           (15) Days after receipt by Owner of Contractor's
                           invoice, all required supporting information and the
                           related Construction Certificate, which fifteenth
                           (15th) day shall be the date payment is due (the
                           "Payment Date").

                  6.2.4    Failure by Owner to pay any amount in dispute shall
                           not alleviate, diminish or modify in any respect
                           Contractor's obligation to achieve Final Acceptance
                           of the Work, and Contractor shall not cease or slow
                           down its performance hereunder on account of any such
                           amount.

                  6.2.5    Amounts not paid by Owner by the Payment Date which
                           are not disputed or the subject of withholding as
                           allowed hereunder shall begin to accrue interest at
                           the rate of one and one-tenth (1.1) of the current
                           prime rate of the Chase Manhattan Bank as follows:

                           6.2.5.1  for amounts for Work self-performed by
                                    Contractor, fifteen (15) Days after the
                                    Payment Date; and

                           6.2.5.2  for amounts payable to Subcontractors and
                                    Vendors, but only for the period for which
                                    Contractor was required to expend
                                    unreimbursed funds.

                  6.2.6    The portion of the G&A Fee payable each month shall
                           be the amount determined by multiplying the Cost of
                           the Work for such month times the G&A Fee. The
                           portion of the Base Fee payable each month shall be
                           the amount determined by multiplying the Cost of the
                           Work for such month times the Base Fee.

                  6.2.7    As a condition to final payment to a Subcontractor or
                           Vendor, Contractor shall provide to Owner full and
                           final waivers and releases of liens and, if the
                           Subcontractor or Vendor is bonded, a consent of
                           surety.

                                                                   Page 18 of 72
<PAGE>   21
                  6.2.8    Payments may be withheld on account of:

                           6.2.8.1  defective Work not remedied;

                           6.2.8.2  claims filed by third parties arising out of
                                    the Work for which Contractor is liable
                                    under this Contract;

                           6.2.8.3  failure of the Contractor to make payments
                                    to Subcontractors or Vendors for labor,
                                    materials or equipment for Work;

                           6.2.8.4  damage to the Owner or another contractor
                                    arising out of the Work for which Contractor
                                    is liable under this Contract; or

                           6.2.8.5  persistent failure to carry out the Work in
                                    accordance with the Contract.

                  6.2.9    Contractor shall, as and when requested, furnish
                           evidence satisfactory to the Owner that all amounts
                           due for labor and material furnished the Contractor
                           in connection with performance of this Contract have
                           been paid or are being paid in the normal course,
                           including union health, welfare and pension fund
                           payments and payroll taxes where applicable. Such
                           evidence shall be furnished in such form and manner
                           as requested by Owner and all statements relative
                           thereto shall, if called for by Owner, be made by
                           sworn affidavit.

         6.3      Award Fee Payments.

                  6.3.1    On a monthly basis, Owner shall meet with Contractor
                           to provide Owner's assessment of Contractor's
                           performance of the Work.

                  6.3.2    Contractor shall be eligible to receive from Owner a
                           fee ("Award Fee") which Owner, acting in its sole and
                           absolute discretion, determines is due in accordance
                           with the criteria specified in Section 6.8 and
                           Appendix "D". The Award Fee due the Contractor, if
                           any, shall be determined on a monthly basis and
                           invoiced in the following month.

         6.4      Cost of the Work. The "Cost of the Work" shall mean costs
                  necessarily and reasonably incurred by the Contractor in the
                  proper performance of the Work. Such costs shall be at rates
                  not higher than the standard paid at the place of the Network
                  except with prior consent of the Owner. The Cost of the Work
                  shall include only the items set forth in this Section 6.4.

                                                                   Page 19 of 72
<PAGE>   22
                 6.4.1    Labor Costs.

                           6.4.1.1  Wages of construction workers directly
                                    employed by the Contractor to perform the
                                    construction of the Work at the Site, or
                                    with the Owner's written approval, at
                                    off-Site workshops.

                           6.4.1.2  Base compensation (wage + time off with pay)
                                    of the Contractor's supervisory and
                                    administrative personnel, who are
                                    Owner-approved, when stationed at the Site
                                    or at Project Headquarters.

                           6.4.1.3  Base compensation (wage + time off with pay)
                                    of the Contractor's supervisory or
                                    administrative personnel, who are
                                    Owner-approved, engaged at factories,
                                    workshops or on the road, in expediting the
                                    production or transportation of materials or
                                    equipment required for the Work, but only
                                    for that portion of their time required for
                                    the Work.

                           6.4.1.4  Costs paid or incurred by the Contractor for
                                    taxes, insurance, assessments and benefits
                                    required by law or collective bargaining
                                    agreements and, for personnel not covered by
                                    such agreements, customary benefits such as
                                    sick leave, medical and health benefits,
                                    holidays, vacations and pensions, provided
                                    such costs are based on wages and salaries
                                    included in the Cost of the Work under
                                    Section 6.4.1.1 through 6.4.1.3. These costs
                                    include retirement plans, 401(k)
                                    contributions, group health, life long and
                                    short-term disability, and public duty pay.
                                    Burden costs include FICA, FUI, SUI,
                                    workers' compensation (if applicable), and
                                    GL insurance costs (if applicable). For home
                                    office personnel, the burden and benefit
                                    cost is     *    of base compensation. For
                                    field employees in the OCIP, the burden and
                                    benefit cost is     *     of base
                                    compensation. For field employees not in the
                                    OCIP, the burden and benefit cost is
                                        *   . These rates and burdens will be
                                    fixed for the term of the Contract, except
                                    as impacted by Change in Law.

                  6.4.2    Subcontract, Material and Equipment Costs. Payments
                           to be made by Contractor to Contractor's
                           Subcontractors and Vendors in accordance with Project
                           requirements and Owner-approved subcontracts and
                           purchase

                  * Portions of this exhibit marked with a "*" have been filed
                    confidentially with the Commission pursuant to a
                    confidential treatment request filed by Registrant.

                                                                   Page 20 of 72
<PAGE>   23
                           orders, inclusive of any duties, taxes or licensing
                           fees arising directly out of or that are applicable
                           thereto, other than taxes on net income.

                  6.4.3    Cost of Shared Resources. Costs associated with
                           resources that are not fully assigned to the Project,
                           costs that require accruals with periodic adjustments
                           and costs related to the use of Contractor equipment
                           will be reimbursed by the Owner as described below.
                           Examples of these costs include: Contractor owned
                           vehicles, construction equipment and test equipment;
                           Contractor owned or separately leased office,
                           warehouse, shop or laydown space; insurance and wage
                           add-ons such as workers' compensation.

                           6.4.3.1  Contractor shall develop and propose for
                                    Owner's Approval cost allocation
                                    methodologies for shared resources which
                                    represent a fair approximation of the actual
                                    cost to compensate Contractor for shared
                                    resources used in the Work. Contractor's
                                    proposal shall include supporting analysis.
                                    Upon Owner's Approval of such methodologies,
                                    Contractor shall administer them.

                           6.4.3.2  Contractor and Owner shall have the right at
                                    any time to request a review of the cost
                                    allocation methodologies if

                  6.4.4    Costs of Other Materials and Equipment. Temporary
                           Facilities and Related Items.

                           6.4.4.1  Costs, including transportation,
                                    installation, maintenance, dismantling and
                                    removal of materials, supplies, temporary
                                    facilities, machinery. equipment, and hand
                                    tools not customarily owned by the
                                    construction workers, which are provided by
                                    the Contractor at the Site and are fully
                                    consumed in the performance of the Work.
                                    Cost less salvage value on such items if not
                                    fully consumed, whether sold to others or
                                    retained by the Contractor.

                           6.4.4.2  Rental charges for temporary facilities,
                                    machinery, equipment, and hand tools not
                                    customarily owned by the construction
                                    workers, which are provided by the
                                    Contractor at the site, whether rented from
                                    the Contractor or others, and costs of
                                    transportation, installation, minor repairs
                                    and replacements, dismantling and removal
                                    thereof. Rates and quantities of equipment
                                    rented shall be subject to the Owner's prior
                                    approval.

                                                                   Page 21 of 72
<PAGE>   24
                           6.4.4.3  Costs of removal of debris from the Site.

                           6.4.4.4  Costs of business-related (non-personal)
                                    telegrams and long-distance telephone calls,
                                    postage and parcel delivery charges,
                                    telephone service at the site and reasonable
                                    petty cash expenses of Project Headquarters.

                           6.4.4.5  That portion of the reasonable travel and
                                    subsistence expenses of the Contractor's
                                    personnel incurred while traveling in
                                    discharge of duties connected with the Work.
                                    Such expenses shall not exceed Contractor's
                                    Travel and Assignment policy attached hereto
                                    as Appendix K.

                  6.4.5    Miscellaneous Costs.

                           6.4.5.1  That portion directly attributable to this
                                    Contract of premiums for insurance and
                                    bonds, except to the extent any coverage
                                    obtained is provided as part of the OCIP.

                           6.4.5.2  Sales, use, gross receipts, business and
                                    occupation or similar taxes imposed by a
                                    Governmental Person which are related to the
                                    Work and for which the Contractor is liable
                                    or required by any Governmental Person to
                                    charge the Owner in connection with any
                                    materials or Work.

                           6.4.5.3  Fees and assessments for building permits
                                    and for other permits, licenses and
                                    inspections which the Contractor is required
                                    to pay or charge as required by the
                                    Contract.

                           6.4.5.4  Fees of testing laboratories for tests
                                    required by the Contract, except those
                                    related to defective or nonconforming Work.

                           6.4.5.5  Royalties and license fees paid for the use
                                    of a particular design, process or product
                                    required by the Contract.

                           6.4.5.6  Deposits lost for causes other than the
                                    Contractor's fault or negligence.

                           6.4.5.7  Other costs specified in Appendix L.

                  6.4.6    Other Costs. Other costs incurred in the performance
                           of the Work if and to the extent approved in advance
                           in writing by the Owner.

                                                                   Page 22 of 72
<PAGE>   25
                  6.4.7    Emergencies; Repairs to Damaged Work.

                           6.4.7.1  Costs incurred by the Contractor for the
                                    emergency repair of damaged Work.

                           6.4.7.2  Costs incurred taking action to prevent
                                    threatened damage, injury or loss in case of
                                    an emergency affecting the safety of persons
                                    or property.

                  6.4.8    Equipment for Project. Construction equipment,
                           vehicles, testing equipment, computers and other
                           equipment and services (e.g. office space,
                           maintenance, etc.) which will be used solely for the
                           Project and will be required by Contractor shall be
                           leased or purchased from third party vendors using
                           the following guidelines:

                           6.4.8.1  The equipment or services shall be acquired
                                    on behalf of Owner unless otherwise directed
                                    by Owner.

                           6.4.8.2  For equipment or service that Owner desires
                                    the Contractor to lease or purchase from
                                    third party vendors, Owner shall retain
                                    title/ownership. Upon completion of the
                                    Project (or at the point the service or
                                    equipment is no longer needed for the
                                    Project), Owner will determine whether to
                                    keep the equipment or service for its
                                    ongoing in the disposal as needed and the
                                    salvage value shall accrue to Owner.

                           6.4.8.3  Generally, lease or purchase from third
                                    party vendors is preferred unless it is
                                    demonstrated that leasing equipment or
                                    service from Contractor is more efficient.
                                    Owner shall retain the right to approve the
                                    method of acquisition for equipment or
                                    services.

         6.5      Costs Not to Be Reimbursed. The Cost of the Work shall not
                  include:

                  6.5.1    Salaries and other compensation of the Contractor's
                           personnel stationed at the Contractor's principal
                           office or offices other than the Site office, except
                           as specifically provided in Sections 6.4.1.2 and
                           6.4.1.3.

                  6.5.2    Expenses of the Contractor's principal office and
                           offices other than the Site office, except as
                           otherwise specified.

                  6.5.3    Overhead and general expenses, except as may be
                           expressly included in Section 6.4.

                                                                   Page 23 of 72
<PAGE>   26
                  6.5.4    The Contractor's capital expenses, including interest
                           on the Contractor's capital employed for the Work,
                           except as otherwise provided herein.

                  6.5.5    Rental costs of machinery and equipment except as
                           specifically provided in Section 6.4.4.2.

                  6.5.6    Costs incurred due to the fault, negligence, error or
                           omission of the Contractor, Subcontractors, Vendors
                           or anyone directly employed, indirectly employed or
                           representing any of them, including costs for
                           correction of damaged, defective or nonconforming
                           Work, disposal and or replacement of materials and
                           equipment incorrectly ordered or supplied, and making
                           good damage to property not forming part of the Work.

                  6.5.7    Any cost not specifically and expressly described in
                           Section 6.4.

                  6.5.8    The cost of Owner-Supplied Items or Rights of Way or
                           anything else provided by Owner.

         6.6      Discounts, Rebates and Refunds. Cash discounts obtained in
                  payments made by the Contractor shall accrue to the Owner.
                  Trade discounts, rebates, refunds and amounts received from
                  sales of surplus materials and equipment shall accrue to the
                  Owner, and the Contractor shall make provisions so that they
                  can be secured.

         6.7      The G&A Fee shall be *  of the Cost of the Work and shall
                  compensate Contractor for the general and administrative
                  expenses, services and Work performed under this Contract.

         6.8      The maximum Award Fee payable shall be  *  of the Cost of the
                  Work. The amount of the Award Fee which Contractor will
                  receive will be based on Contractor's performance of the Work,
                  as weighted and determined by Owner in accordance with
                  Appendix "D", in the following areas:

                  6.8.1    Program Management: Timely and accurate reporting,
                           estimating, drawing completion, material control,
                           permitting and cooperation with Owner and the
                           Oversight Engineer. See Appendix "E".

                  6.8.2    Safety: Preparation, coordination and compliance with
                           all safety requirements of federal, state, local
                           laws, rules and regulations and Rights of Way owners
                           to ensure an accident free work environment. See
                           Appendix "F".

                  * Portions of this exhibit marked with a "*" have been filed
                    confidentially with the Commission pursuant to a
                    confidential treatment request filed by Registrant.

                                                                   Page 24 of 72
<PAGE>   27
                  6.8.3    Quality: Development, maintenance and reporting the
                           evidence of a Quality Control Plan to ensure the
                           integrity and durability of the Network.
                           See Appendix "G".

                  6.8.4    Cost: Timeliness and accuracy of estimates, cost
                           projections, cost management, application of
                           effective cost accounting and Contract Budget
                           compliance. See Appendix "H".

                  6.8.5    Schedule: Timely preparation and maintenance of the
                           Construction Schedule with the greatest emphasis on
                           meeting or beating all milestones and Completion
                           Dates. See Appendix "I".

         6.9      Owner's evaluation of the foregoing criteria shall be in
                  Owner's sole and absolute discretion and not subject to
                  determination by any other party or tribunal. If Contractor
                  does not agree with Owners performance rating, Owner will
                  re-evaluate the rating, but Owner's revised rating (if
                  revised) is final.

         6.10     Upon completion of each Segment and as may be more frequently
                  required by Owner, Contractor shall provide waivers and
                  releases of lien and bond rights for itself, Subcontractors
                  and Vendors.

         6.11     Within ten (10) Days of execution of the Contact, Contractor
                  shall provide a labor rate schedule, specifying name and
                  hourly/weekly rates and any addons, for key personnel of
                  Contractor performing any Work. Charges which become part of
                  the Cost of the Work for each such person shall be consistent
                  with such schedule.

         6.12     The Base Fee shall be *              of the Cost of the Work.

7        PROJECT COMPLETION TIMEFRAME

         7.1      Contractor shall perform all Work necessary so that the Final
                  Acceptance of each Network in accordance with Section 20 is no
                  later than the Completion Date specified in the relevant
                  Construction Schedule, as approved by Owner. Time is of the
                  absolute essence of this Contract. Completion Dates may be
                  changed only with Owner's Approval.

         7.2      As the design and engineering progresses, Contractor shall
                  subdivide the Work of each Network into manageable Segments as
                  shown in the Construction Schedule approved by Owner. Each of
                  these Segments shall have a Completion Date as they are
                  incorporated into the Construction Schedule.

8        ITEMS FURNISHED BY OWNER

     * Portions of this exhibit marked with a "*" have been filed confidentially
       with the Commission pursuant to a confidential treatment request filed by
       Registrant.

                                                                   Page 25 of 72
<PAGE>   28
         8.1      Owner will furnish Rights of Way and real estate for the
                  Project infrastructure.

         8.2      Owner will furnish the design criteria for the fiber optic
                  cable and conduit system, and facilities.

         8.3      Owner will execute purchase agreements or otherwise procure
                  the following materials in sufficient quantities to complete
                  the Project, but reserves the right to direct Contractor to
                  perform the bid and purchasing process for such items
                  ("Owner-Supplied Items"):

                  8.3.1    duct;

                  8.3.2    fiber optic cable;

                  8.3.3    handholes;

                  8.3.4    manholes;

                  8.3.5    splice cases;

                  8.3.6    fiber splice panels;

                  8.3.7    fiber locate system; and

                  8.3.8    such other items as Owner determines to provide.

         8.4      With respect to any Owner-Supplied Items for which Owner has
                  executed purchase agreements, Contractor shall issue delivery
                  orders against said purchase agreements and incorporate these
                  materials into the material control system required under
                  Section 3.2.6 to ensure compliance with the Construction
                  Schedule.

         8.5      Owner will comply with Appendix "J" Response Times for Owners
                  Approval attached hereto.

9        SCHEDULING AND QUALITY CONTROL

         9.1      Scheduling.

                  9.1.1    Scheduling of Construction. It shall be the
                           obligation of Contractor to develop, assemble,
                           coordinate and obtain Owner's Approval of a
                           Construction Schedule for each Network or portion
                           thereof as provided

                                                                   Page 26 of 72
<PAGE>   29
                           herein, which shall provide for Substantial
                           Completion thereof and all Work related thereto by
                           the Completion Date. Contractor shall prepare the
                           Construction Schedule and prepare monthly updates and
                           other reports specified herein. The critical path
                           method ("CPM") type progress schedule shall be used
                           to schedule the Work. Each Construction Schedule
                           shall include a full definition of Work to be
                           performed by Contractor, Subcontractors and Vendors
                           and showing utilization of Owner-Supplied Items and
                           Rights of Way. Each Construction Schedule shall be a
                           fully resource and cost loaded precedence network
                           plan utilizing a work breakdown structure ("WBS") for
                           defining the scheduling hierarchy and provide for the
                           planning and the execution of the Work. Each
                           Construction Schedule shall be a resource-leveled
                           schedule, which defines target dates in place of
                           initially developed early/late start dates. Each
                           Construction Schedule shall, in addition, be used for
                           planning and monitoring the progress of the. All CPM
                           Construction Schedules shall be done in the latest
                           version of MS Project. Unless otherwise approved by
                           Owner, all duration of activities for which Owner is
                           responsible shall be the duration specified in this
                           Contract.

                  9.1.2    Construction Schedule. Within thirty (30) Days after
                           issuance by Owner of a Notice to Proceed with a
                           Network or a portion thereof, Contractor shall submit
                           each Construction Schedule in CPM format, in hard
                           copy and on 3.5 inch data diskettes, which shall
                           contain all data used to produce the Construction
                           Schedule in accordance with Section 9.1. The
                           Construction Schedule shall provide information to
                           Owner detailing and describing all activities
                           required to complete the Work, their duration and
                           location. The type, WBS element, duration, location
                           where the activity will be performed and its
                           relationship to other elements of the Work shall be
                           stated for each activity shown on the Construction
                           Schedule. The Construction Schedule shall be prepared
                           such that each activity is controlled, is capable of
                           being measured and is provided with a sorting
                           capability to the established WBS elements,
                           performing organizations, dates, float and activity
                           numbers. Each Construction Schedule shall incorporate
                           as activities, Governmental Approvals, permits,
                           submittals, samples and shop drawings that will be
                           required for the Work. Design and construction
                           activities shall be scheduled separately and
                           preliminary and final design submittals shall be
                           indicated as milestone events.

                  9.1.3    Allocation of Contract Budget and Cost of the Work.
                           Contractor shall allocate such amounts among the
                           scheduled activities defined by the Construction
                           Schedule such that each activity has an allocation
                           that accurately indicates the Contract Budget and
                           Cost of the Work for such activity.

                                                                   Page 27 of 72
<PAGE>   30
                  9.1.4    Representations. Review of Construction Schedules and
                           updates by Owner shall not constitute a
                           representation by Owner that the Work can be
                           completed as shown on the Construction Schedule or
                           updates. Construction Schedules and updates shall
                           constitute a representation by Contractor as to how
                           it envisions the Work to be accomplished.

                  9.1.5    Schedule Authorization. After each Construction
                           Schedule has been developed and received Owner's
                           Approval, Contractor shall use each Construction
                           Schedule for the performance and completion of the
                           Work and by both parties to this Contract for
                           monitoring and determining actual progress and Cost
                           of the Work. Each Construction Schedule shall be used
                           to evaluate time impacts to the critical path of
                           those events for which an adjustment of time is
                           allowed under Section 11. A Construction Schedule may
                           not be amended or modified without the prior written
                           consent of Owner, except as provided in Section
                           9.1.6.

                  9.1.6    Revisions to the Construction Schedules. No change to
                           a Completion Date for a Network may be made other
                           than pursuant to Section 11. If Owner does not agree
                           to an updated or revised Construction Schedule, and a
                           dispute ensues, Contractor may upon notification to
                           Owner, in the interim while the dispute is pending,
                           amend or modify such Construction Schedule to
                           correspond to the resources and rates of production
                           to be used by the Contractor, but only for the
                           purpose of Contractor's scheduling of its effort. The
                           final resolution of the dispute shall be reflected in
                           such Construction Schedule, and, if necessary, a
                           recovery schedule will be prepared.

                  9.1.7    Orderly Progression of Work. Contractor shall at all
                           times schedule and direct its Work so that it
                           provides an orderly progression of the Work to
                           completion within the specified time for completion
                           and in general conformance with the Construction
                           Schedule and revisions accepted by Owner.

                  9.1.8    Updates. Contractor shall review and update the
                           progress of its Work each month for the duration of
                           the Project. A Construction Schedule update meeting
                           will be held each month by Owner and shall be
                           attended by Contractor. At Owner's sole discretion
                           more frequent updates may be required from time to
                           time. Actual progress of the previous month will be
                           recorded and future activities will be reviewed. Each
                           Construction Schedule shall be updated for the
                           purpose of determining:

                           9.1.8.1  actual physical percentage of completion of
                                    each Network;

                           9.1.8.2  proposed revisions to logic, duration, unit
                                    cost or unit productivity rates;

                                                                   Page 28 of 72
<PAGE>   31
                           9.1.8.3  projected future start and Completion Dates;
                                    and

                           9.1.8.4  delays affecting the Completion Date for a
                                    Network;

                  9.1.9    Progress Summary. Contractor is responsible for
                           having information and data at each monthly meeting
                           to provide the verifications set out above. As a part
                           of the monthly updating process, Contractor shall
                           prepare a narrative progress summary describing the
                           physical progress during the report period, plans for
                           the forthcoming month, potential delays and problems,
                           their estimated effect on performance and overall
                           Project completion and an explanation of corrective
                           action taken or proposed. Contractor shall submit two
                           (2) copies of the narrative progress report to Owner
                           five (5) Business Days before each schedule update
                           meeting.

                  9.1.10   Additional Information. At the monthly schedule
                           meeting, Contractor shall also provide to Owner a
                           copy of the following:

                           9.1.10.1         a ninety (90) Day computer look
                                            ahead tabular listing and bar chart
                                            schedule sorted by WBS component and
                                            activity start dates;

                           9.1.10.2         a bar chart schedule reflecting the
                                            activities shown on each
                                            Construction Schedule for the
                                            immediately succeeding six (6) month
                                            period;

                           9.1.10.3         an updated report that shows actual
                                            progress in obtaining permits as
                                            compared to each Construction
                                            Schedule;

                           9.1.10.4         a report, which shows Contractor's
                                            actual material and labor progress,
                                            as compared to each Construction
                                            Schedule;

                           9.1.10.5         a copy of data diskettes (3.5 - inch
                                            DS/HD) from which the monthly
                                            reports were prepared;

                           9.1.10.6         an updated design submittal schedule
                                            detailing submittals for the
                                            succeeding ninety (90) Days.

                           9.1.10.7         Additional information as may be
                                            requested to address questions that
                                            may arise.

                  9.1.11   A three (3) week look ahead schedule will be
                           submitted for each Network on a weekly basis that
                           indicates the two (2) forthcoming weeks and the
                           previous week. If Contractor fails to meet the
                           previous week's schedule,

                                                                   Page 29 of 72
<PAGE>   32
                           Contractor shall provide a written explanation
                           describing the cause of any deviation from the
                           planned progress.

                  9.1.12   Recovery Schedule. Contractor shall furnish
                           employees, materials, facilities and equipment to
                           work such hours, including extra shifts, overtime,
                           Sundays and holidays, as necessary to ensure the
                           completion of Work in accordance with the
                           Construction Schedule. If Contractor falls fifteen
                           (15) Days behind on any critical path activity shown
                           on the Construction Schedule, or it becomes apparent
                           that the Work may not be completed as scheduled, or
                           that milestone dates may not be achieved as
                           scheduled, Contractor shall prepare and submit a
                           recovery schedule demonstrating Contractor's program
                           and proposed plan to regain the lost schedule
                           progress. After Owner and Contractor agree upon a
                           recovery schedule, it will become a part of the
                           Construction Schedule.

         9.2      Review by Owner. Contractor shall produce and Owner shall
                  review all design and construction Documents. Owner's review
                  of or comment upon or lack of review of or comment upon any
                  Documents does not relieve Contractor from its obligation to
                  complete the Project in accordance with this Contract. Review
                  or release by Owner of any of the design and construction
                  Documents shall not relieve Contractor of any of its
                  obligations under this Contract.

         9.3      Design and Construction Documents. All design Documents
                  required for the Work shall be sufficiently complete to allow
                  Owner to review the design and authorize the start of
                  construction of all elements of the Work. Owner's responses
                  shall be delivered in accordance with Appendix "J".

         9.4      Quality Control Program.

                  9.4.1    Plan. Contractor shall establish and maintain
                           procedures to ensure the quality of Work and the
                           completed Project. The procedures shall apply to
                           design, engineering, construction and procurement of
                           the Work. The procedures shall be implemented by
                           Contractor as a "Quality Control Plan" ("QCP") and
                           shall contain information as specified herein or
                           required by Owner. The QCP shall be submitted to
                           Owner for Owner's Approval within forty-five (45)
                           Days of the date of execution of this Contract. After
                           Owner's Approval of the QCP, Contractor shall notify
                           Owner in writing of any proposed changes. Proposed
                           changes shall be subject to Owner's Approval in its
                           sole discretion. The QCP shall include at a minimum
                           the following:

                           9.4.1.1  a description of the quality control
                                    organization;

                                                                   Page 30 of 72
<PAGE>   33
                           9.4.1.2  the name, qualifications, duties,
                                    responsibilities and authorities of each
                                    person assigned a quality control function;

                           9.4.1.3  a description of the responsibilities and a
                                    resume of experience of the QCP manager;

                           9.4.1.4  procedures for preparing, reviewing and
                                    presenting submittals, including those of
                                    Subcontractors, Vendors, offsite
                                    fabricators, suppliers and purchasing
                                    agents, to ensure they conform to Contract
                                    requirements;

                           9.4.1.5  testing frequencies and procedures for each
                                    specific test, to be submitted
                                    incrementally, as technical specification
                                    sections are prepared;

                           9.4.1.6  reporting procedures, including proposed
                                    reporting formats;

                           9.4.1.7  document control system and procedures
                                    showing how design, quality and discipline
                                    coordination will be achieved; and

                           9.4.1.8  names of testing firms to be used, with
                                    licenses as appropriate.

                  9.4.2    Documentation. Contractor shall maintain current
                           records of quality control operations, activities,
                           and tests performed including the Work of Vendors and
                           Subcontractors. These records shall be in a form
                           acceptable to Owner and indicate a description of
                           Subcontractors and Vendors working on the Project,
                           the number of personnel working, the weather
                           conditions encountered, any delays encountered, and
                           acknowledgment of deficiencies noted along with the
                           corrective actions taken on current and previous
                           deficiencies. In addition, these records shall
                           include factual evidence that required activities or
                           tests have been performed, including but not limited
                           to the following:

                           9.4.2.1  type and number of quality control
                                    activities and tests involved;

                           9.4.2.2  results of quality control activities or
                                    tests;

                           9.4.2.3  nature of defects, causes for rejection,
                                    etc;

                           9.4.2.4  proposed remedial action; and

                                                                   Page 31 of 72
<PAGE>   34
                           9.4.2.5  corrective actions taken.

                           Such records shall cover both conforming and
                           defective or deficient features and shall include a
                           statement that supplies and materials incorporated in
                           the Work comply with this Contract. Legible copies of
                           such records shall be furnished weekly to Owner.

                  9.4.3    Contractor shall not commence Work until Owner has
                           accepted the QCP for that Work element.

                  9.4.4    Owner retains the right, but not the obligation, to
                           direct the location and the timing of testing
                           additional to that planned by Contractor.

10       NOTICE TO PROCEED, RIGHTS OF WAY.RELEASE AND CONSTRUCTION
         PROCEDURES

         10.1     Notice to Proceed.

                  10.1.1   Owner will issue a Notice to proceed ("Notice to
                           Proceed") to authorize Contractor to proceed with the
                           Work, or portions of the Work in respect of a
                           Network, in numerous separate stages as Owner deems
                           proper. Issuance of a Notice to Proceed shall
                           constitute a release to Contractor of the Rights of
                           Way described therein. Contractor shall not be
                           authorized or obligated to proceed to perform or
                           incur any Cost of the Work to perform any Work for
                           which a Notice to Proceed has not been issued.
                           Contractor shall review and inspect the Rights of Way
                           and Immediately advise Owner of any inadequacy of
                           which Contractor is aware or reasonably should be
                           aware.

                  10.1.2   Owner may provide a Notice to Proceed with respect to
                           Additional Rights of Way as they become available.
                           Nothing in Section 10.1 shall limit Contractor's
                           obligations to obtain all necessary licenses, permits
                           and approvals, including without limitation
                           Governmental Approvals, including without limitation
                           all access permits necessary to construct on, under
                           and over Rights of Way of other Governmental Persons
                           or owners of Rights of Way to comply with the
                           Construction Schedule. Contractor agrees to take or
                           allow no action, which may impair or delay Owner in
                           obtaining Rights of Way or which may tend to increase
                           the cost for obtaining the Rights of Way or the
                           compensation Owner may pay for Rights of Way. Owner
                           shall advise Contractor of any Rights of Way issues
                           of which it is aware which may impact the Cost of the
                           Work.

                                                                   Page 32 of 72
<PAGE>   35
                           10.1.2.1         Initial Rights of Way. The "Initial
                                            Rights of Way" are those Rights of
                                            Way selected and procured by Owner
                                            for the Project. Contractor shall
                                            design, engineer and plan its Work
                                            so that it can be constructed within
                                            the Initial Rights of Way whenever
                                            possible.

                           10.1.2.2         Additional Rights of Way. If, in
                                            order to accommodate Contractor's
                                            design, Rights of Way additional to
                                            Initial Rights of Way are desired,
                                            and if, in Owner's sole discretion,
                                            Owner agrees to acquire such
                                            additional Rights of Way, Owner
                                            shall provide them at Owner's
                                            expense whereupon they shall become
                                            "Additional Rights of Way."

                           10.1.2.3         Owner reserves the right to at its
                                            own discretion, to direct in writing
                                            Contractor to secure Additional
                                            Rights of Way on behalf of Owner.

                           10.1.2.4         If Contractor desires to incur Cost
                                            of the Work with respect to Rights
                                            of Way prior to Owner obtaining the
                                            requested Rights of Way, Contractor
                                            may request such access, which Owner
                                            may grant in its sole discretion.

                           10.1.2.5         Notices to Proceed with construction
                                            will be issued separately from
                                            Notices to Proceed with engineering
                                            and procurement.

                  10.1.3   Contractor acknowledges that as of the Effective
                           Date, Owner has not secured Rights of Way for all
                           portions of the Network.

         10.2     Commencement of Construction Work. Contractor will not perform
                  any construction Work until all Governmental Approvals
                  necessary for construction have been obtained, and Owner has
                  determined that adequate Drawings and Specifications exist to
                  allow observation of the Work by the Oversight Engineer and
                  Owner.

         10.3     Review Period. Owner will issue a Notice to Proceed for
                  Construction Work when all Governmental Approvals necessary
                  for such Construction Work have been obtained, and Owner has
                  determined that adequate Drawings and Specifications exist to
                  allow observation of the Construction Work by the Oversight
                  Engineer and Owner.

         10.4     Character of Employees. Contractor shall employ resources for
                  completing the Work to full completion in the manner and time
                  required by this Contract. All

                                                                   Page 33 of 72
<PAGE>   36
                  employees shall have the skill and experience and any licenses
                  required to perform the Work assigned to them. Any Person
                  employed by Contractor or by any Subcontractor who does not
                  perform the Work in a proper and skillful manner or conducts
                  himself or herself in a non-professional manner shall, at the
                  written request of Owner, be removed by Contractor or such
                  Subcontractor and shall not be employed on the Project without
                  the approval of Owner.

         10.5     Inspection and Testing. All materials and every part of the
                  Work shall be subject to inspection and testing by Owner.
                  Owner and the Oversight Engineer shall be allowed access to
                  all parts of the Work and shall be furnished with information
                  and assistance by Contractor as required to make a complete
                  and detailed inspection and perform any testing that such
                  entity may deem appropriate. Prior to Substantial Completion,
                  Contractor shall remove or uncover such portions of the
                  finished Work as directed. After examination by Owner or the
                  Oversight Engineer, Contractor shall restore the Work to the
                  standard required by this Contract. If the Work thus exposed
                  or examined conforms to the requirements of the Contract,
                  uncovering, removing, and restoring the Work will be paid for
                  as part of the Cost of the Work. If the Work exposed or
                  examined does not conform to the requirements of the Contract,
                  uncovering, removing, and restoring the Work shall not be part
                  of the Cost of the Work. Any Work done or materials used
                  without inspection by an authorized Owner representative may
                  be ordered uncovered, removed, or restored at Contractor's
                  expense unless Owner's representative failed to inspect the
                  Work after having been given, reasonable notice in writing
                  that the Work was to be performed. All inspections and all
                  tests conducted by Owner or the Oversight Engineer are for the
                  convenience and benefit of the Owner or the Oversight
                  Engineer. These inspections, tests or any payment do not
                  constitute acceptance of the materials, Work tested or Work
                  inspected. Owner may reject or accept any Work or materials at
                  any time prior to Substantial Completion whether or not
                  previous inspections or tests were conducted by Owner or the
                  Oversight Engineer.

         10.6     Removal of Unacceptable Work. Unacceptable Work is Work that
                  does not conform to the requirements of this Contract.
                  Unacceptable Work shall be removed and replaced so as to be
                  acceptable to Owner at Contractor's expense and shall not be
                  included in the Cost of the Work. The fact that Owner may not
                  have discovered the unacceptable Work shall not constitute an
                  acceptance of such unacceptable Work. Owner may cause
                  unacceptable Work to be remedied or removed and replaced.
                  Owner may deduct the cost of doing so from any monies due or
                  to become due to Contractor.

         10.7     Utilities, Railway and Highway Crossings.

                                                                   Page 34 of 72
<PAGE>   37
                  10.7.1   Contractor is responsible for the provision of all
                           utilities necessary for construction and operation of
                           the Project when completed. Contractor is also
                           responsible for the relocation and the temporary
                           provision of all utilities necessary to supply
                           utility service to Contractor and other utility
                           customers while existing utilities are being
                           relocated by Contractor. Contractor shall honor and
                           perform all obligations of Owner under all relocation
                           agreements to the extent Owner advises Contractor of
                           the same.

                  10.7.2   Where Contractor's operations are adjacent to utility
                           property, which if damaged might result in any
                           expense, loss, or inconvenience, Work shall not
                           commence until Contractor shall have made
                           arrangements for the protection of such property.
                           Contractor shall make arrangements for the temporary
                           use of railway and roadway crossings. Work performed
                           by Contractor on railroad or roadway Rights of Way
                           shall be performed to avoid interference with the
                           movement of trains or traffic on the railroad tracks
                           or traffic on the roadways. Contractor shall use care
                           and caution in order to avoid accidents, damage, or
                           unnecessary delay or interference with the railway
                           company's trains or property or with public or
                           private roadway traffic or property. Any loss of the
                           nature to be prevented as described in this section
                           shall be a Cost of the Work, subject to the
                           following:

                           10.7.2.1         to the extent any such loss is not
                                            covered by insurance and is
                                            attributable to the negligence or
                                            willful misconduct of Contractor, it
                                            shall be at Contractor's sole cost
                                            and expense; and

                           10.7.2.2         to the extent any such loss is
                                            covered by insurance and is
                                            attributable to the negligence or
                                            willful misconduct of Contractor,
                                            any deductible shall be at
                                            Contractor's cost and expense.

                  10.7.3   Owner shall be entitled to and receive all rebates
                           and recoveries of any nature and type arising from
                           construction and relocation of utilities. When
                           securing temporary and permanent utilities for the
                           Project, Contractor shall arrange for the utilities
                           based on usage indicated by Owner.

         10.8     Subcontracting and Purchasing.

                  10.8.1   Contractor shall pre-qualify all proposed
                           Subcontractors and Vendors for submittal to Owner for
                           Owner's Approval and obtain the Owner's Approval of
                           all proposed Subcontractor and Vendor selections and
                           agreements with a value greater than ten thousand
                           dollars ($10,000). All Work to be

                                                                   Page 35 of 72
<PAGE>   38
                           subcontracted or purchased shall be in accordance
                           with Owner-approved procedures. Contractor shall keep
                           Owner advised of all of its bidding activities for
                           subcontracts or purchase orders.

                  10.8.2   Each instruction evidencing any agreement of
                           Contractor with any Subcontractor or Vendor shall
                           provide that, pursuant to terms in form and substance
                           satisfactory to Owner, the rights of Contractor under
                           such instrument are assignable to Owner, its assigns,
                           and their respective successors and assigns upon
                           Owner's written request following default by
                           Contractor and termination or expiration of this
                           Contract, and all warranties of such Subcontractor or
                           Vendor shall run to Owner and its assigns.
                           Notwithstanding any subcontract or agreement with any
                           Subcontractor or Vendor, Contractor is solely
                           responsible for the Work, and no portion thereof
                           shall be unfinished or incomplete and the Project
                           milestones identified in each Construction Schedule
                           shall not be delayed due in whole or in part to any
                           disagreement between or among Subcontractors or
                           between any Subcontractor or Vendor and Contractor.
                           No subcontract or purchase order shall bind or
                           purport to bind Owner. Contractor shall include in
                           each of its subcontracts and material supply
                           agreements terms that are substantially similar to
                           those contained in Sections 11, 12 and 13. Contractor
                           shall provide to Subcontractors and Vendors, as
                           appropriate, copies of those provisions of this
                           Contract which the Subcontractor or Vendor shall be
                           bound on a flowdown basis, as they relate to such
                           Person's portion of the Work.

                  10.8.3   Contractor shall not utilize as a Subcontractor or
                           Vendor any Person whom Contractor owns or controls or
                           with which it is affiliated without specific advance
                           written approval by Owner.

                  10.8.4   Unless waived by Owner, Contractor shall require each
                           Subcontractor to provide a payment and performance
                           bond in a format acceptable to Owner and executed by
                           a Surety.

         10.9     Use of Explosives. Explosives shall not be used in the
                  prosecution of the Work without prior written approval of
                  Owner.

         10.10    Protection and Restoration of Property and Landscape.
                  Contractor shall preserve private and public property and
                  protect it from damage. Land monuments and property marks
                  shall not be disturbed or moved until their location has been
                  witnessed or referenced and their removal approved. Contractor
                  shall restore damaged or injured property, at Contractor's
                  expense, to a condition similar or equal to that existing
                  before the damage or injury occurred, by repairing,
                  rebuilding, or restoring the property.

                                                                   Page 36 of 72
<PAGE>   39
         10.11    Limitation on Work Hours. Contractor shall comply with state
                  and local laws and policy with respect to work hours.

11       CHANGES IN THE WORK

         11.1     Change Order.

                  11.1.1   Owner may, at any time and from time to time and
                           without notice to any Surety, authorize changes in
                           the Work, including but not limited to changes to the
                           Warranties or increase the Work or decrease the Work,
                           through issuance of a "Change Order".

                  11.1.2   In the event that Owner issues a Change Order, Owner
                           shall advise Contractor of same and Owner and
                           Contractor shall then promptly consult concerning the
                           estimated cost and impact on the relevant Contract
                           Budget and Construction Schedule of implementing the
                           Change Order. Any Change Order for engineering or
                           design Work will be issued separately from a Change
                           Order for Construction Work.

                           11.1.2.1 Following such consultation, Owner may
                                    request, and Contractor shall promptly
                                    prepare, a detailed estimate relating to the
                                    contemplated change including, a
                                    modification to the Work, projected
                                    modification of the relevant Contract
                                    Budget, a detailed identification of the
                                    effect on the Cost of the Work.

                           11.1.2.2 Contractor shall notify Owner of any effect
                                    such change could be expected to have on any
                                    Completion Dates for a Network, on the
                                    relevant Construction Schedule, on any other
                                    relevant Construction Schedule and on
                                    Contractor's ability to comply with any of
                                    its obligations hereunder, including the
                                    Warranties.

                           11.1.2.3 Contractor shall provide the information
                                    required in Sections 11.1.2.1 and 11.1.2.2
                                    in a form acceptable to Owner which shall be
                                    referred to as a "Change in the Work Form."
                                    If the parties reach agreement on the
                                    matters listed in a Change in the Work Form,
                                    such form shall be amended, if necessary, to
                                    reflect such agreement and Owner shall
                                    endorse the same "Accepted by Owner."
                                    Contractor shall promptly adjust (with
                                    approval of Owner) the relevant Construction
                                    Schedule and any other exhibits and

                                                                   Page 37 of 72
<PAGE>   40
                                    Construction Schedule requiring adjustment
                                    to indicate the effect of the change so
                                    agreed. Each Change in the Work Form, once
                                    approved in accordance with this Section
                                    11.1.2, shall become a part of the relevant
                                    Change Order.

                  11.1.3   Owner and Contractor shall use their best efforts to
                           agree upon the change to the relevant Contract Budget
                           as a result of any Change Order. Contractor shall
                           proceed with a change as ordered by Owner. No change
                           in a Contract Budget shall result from a change which
                           does not materially affect the Cost of the Work. In
                           the event Owner and Contractor are unable to agree on
                           whether a change will materially affect the Cost of
                           the Work or the applicable Completion Date for a
                           Network, Contractor shall separately record such
                           costs and the time associated therewith. Nothing in
                           this Section 11.1.3 shall alleviate, diminish, or
                           modify in any respect Contractor's obligations under
                           this Contract.

                  11.1.4   Contractor may request that Owner consider a Change
                           Order for the Work. A request by Contractor for a
                           Change Order shall be made by written Notice.
                           Supporting data in the form of a Change in the Work
                           Form shall be delivered within ten (10) Business Days
                           of the request. The Change in Work Form shall be
                           accompanied by a written statement that the amount
                           requested includes all known costs amounts including
                           direct, indirect, and consequential costs, and all
                           impacts to the relevant Construction Schedule and any
                           Completion Dates. Contractor shall not make any
                           changes in the Work (including such changes that have
                           no net cost effect on the Contract Budget) without
                           the prior written consent of Owner. Owner may
                           withhold its consent in its absolute discretion.

         11.2     Extensions of Time.

                  11.2.1   The Completion Date for a Network may only be changed
                           as a result of the existence or occurrence of a Force
                           Majeure Event if such event results in a change in
                           the duration of the critical path as set forth in the
                           relevant Construction Schedule. All requests pursuant
                           to Section 11.2.1 for changes to a Completion Date
                           shall include an analysis showing the actual impact
                           of the event on the Construction Schedule and
                           affected Completion Date or Final Acceptance Date. No
                           adjustments to a Completion Date pursuant to this
                           Section 11.2.1 shall be allowed if the event did not
                           directly affect the critical path indicated in the
                           Construction Schedule. As a condition precedent to
                           Owner providing an adjustment in accordance with this
                           Section 11.2.1, Contractor must notify Owner in
                           writing of any such request within seven (7) Days of
                           the first discovery of the occurrence of said Force
                           Majeure Event and must update this notification in
                           writing every

                                                                   Page 38 of 72
<PAGE>   41
                           five (5) Days. Within ten (10) Days of the
                           termination of the said Force Majeure Event,
                           Contractor shall submit a written request for change.
                           If notification and request for change to the
                           relevant Completion Date is not received within the
                           time limits identified above, the critical path shall
                           be considered unaffected by the occurrence or
                           existence of the Force Majeure Event, and Contractor
                           shall forfeit all rights to an adjustment to such
                           Completion Date.

                  11.2.2   Rights of Way Release Delay. Adjustments to a
                           Completion Date shall not be allowed if a delay did
                           not affect the critical path indicated on the
                           relevant Construction Schedule. Contractor shall not
                           be entitled to any extension of a Completion Date to
                           the extent that the release of Rights of Way is
                           delayed by reason of the fault, negligence, act or
                           failure to act of Contractor, any Subcontractor, any
                           Vendor or any other Person for whom any of them may
                           be responsible. As a condition precedent to Owner
                           providing an adjustment other than a day-for-day
                           extension to a Completion Date in accordance with
                           this Section 11.2.2, Contractor must notify Owner in
                           writing of any such request within seven (7) Days of
                           first discovery of a delay in issuance of a Notice of
                           proceed with respect to Rights of Way affecting the
                           critical path and resulting in a seasonal restraint.
                           Within ten (10) Days of the termination of the
                           seasonal restraint, Contractor shall submit a written
                           request for change. If notification and request for
                           change to a Completion Date is not received within
                           the time limits identified above, the critical path
                           shall be considered unaffected by the occurrence of
                           the seasonal restraint and Contractor shall forfeit
                           all rights to an adjustment to such Completion Date.

                  11.2.3   Notwithstanding any other provision contained herein,
                           no Completion Date shall be adjusted for normal
                           inclement weather. Contractor shall be entitled to an
                           extension of time only if Contractor can substantiate
                           that there was greater than normal inclement weather
                           considering the full term of this Contract and using
                           a ten-year average of accumulated record mean values
                           from climatological data compiled by the U.S.
                           Department of Commerce National Oceanic and
                           Atmospheric Administration for the locale of the
                           relevant Network, and that such alleged greater than
                           normal inclement weather lengthened the critical path
                           indicated in the relevant Construction Schedule. The
                           time for completion shall be extended by the
                           appropriate number of calendar days as determined
                           from the aforesaid data and schedule analysis.

         11.3     Additional Costs

                                                                   Page 39 of 72
<PAGE>   42
                  11.3.1   Change in Law: Scope. If, as a result of any Change
                           in Law requiring a material change in the Work, the
                           Cost of the Work for a Network will exceed the
                           relevant Contract Budget, the Contract Budget with
                           respect thereto may be increased in accordance with
                           this Section 11.3.l. All requests for increases in a
                           Contract Budget under this Section 11.3.1 shall
                           include an analysis showing the actual impact of the
                           Change in Law on the Cost of the Work. No increase in
                           a Contract Budget shall be allowed if the Change in
                           Law did not directly increase the Cost of the Work.
                           As a condition precedent to Owner providing such an
                           increase, Contractor must notify Owner in writing of
                           any such request within ten (10) Days of obtaining
                           knowledge of such Change in Law. Within thirty (30)
                           Days of the date of such request, Contractor shall
                           provide Owner with the analysis of the actual impact
                           of such Change in Law referenced above. If
                           notification and the analysis are not received within
                           the time limits identified above, the Contract Budget
                           will be considered unaffected by the Change in Law
                           and Contractor shall forfeit all rights to an
                           increase in the Contract Budget with respect thereto.
                           Any increase in a Contract Budget in accordance with
                           this Section 11.3.1 shall be limited to the
                           additional costs reasonably incurred by Contractor
                           which are directly attributable to and which would
                           not have been incurred but for the Change in Law
                           giving rise to such request.

         11.4     Hazardous Substances. In the event the Contractor encounters
                  on the Site material reasonably believed to be a Hazardous
                  Substance which has not been rendered harmless, the Contractor
                  shall immediately stop Work in the area affected and report
                  the condition to the Owner in writing. Work in the affected
                  area shall not thereafter be resumed except by written
                  agreement of the Owner and Contractor if in fact the material
                  is a Hazardous Substance and has not been rendered harmless.
                  The Work in the affected area shall be resumed in the absence
                  of a Hazardous Substance or when it has been rendered harmless
                  by written agreement of the Owner and Contractor. Owner shall
                  provide Contractor information in its possession or of which
                  it is aware concerning Hazardous Materials at the Site.
                  Contractor shall not be required to perform Work in connection
                  with Hazardous Substances absent mutual agreement of Owner and
                  Contractor with respect thereto.

         11.5     Acceleration. Notwithstanding any other provisions herein, in
                  the event any extension of a Completion Date is properly due
                  under this Contract, regardless of the provision of this
                  Contract under which such extension arises, Owner shall have
                  the right, in its sole discretion, to decide whether to permit
                  the extension, relief or to require Contractor to implement a
                  recovery schedule which does not include any time extension or
                  relief. At Owner's request, Contractor shall prepare and
                  submit to Owner with its request for time extension or relief
                  at least two (2)

                                                                   Page 40 of 72
<PAGE>   43
                  alternative Change in the Work Forms setting forth the
                  proposed cost of additional Work to implement the recovery
                  schedule, both with and without a time extension or relief. If
                  Owner elects to implement the recovery schedule in lieu of an
                  extension of the affected Completion Date or relief, Owner
                  shall issue a Change Order adjusting the relevant Contract
                  Budget to account for additional costs resulting from all
                  steps necessary to accelerate the Work and implement the
                  recovery schedule.

         11.6     Failure of Owner and Contractor to agree to any adjustment
                  under this Section 11 shall be a dispute under Section 18.
                  However, nothing in this Section 11 shall excuse Contractor
                  from expeditiously proceeding with the Work required under
                  this Contract as changed pursuant to a Change Order.

12       TERMINATION FOR CONVENIENCE

         12.1     Owner may, in its sole discretion, terminate this Contract and
                  the performance of the Work in whole or, from time to time, in
                  part, if Owner determines that a termination is in Owner's
                  best interest. Owner shall notify Contractor of its decision
                  to terminate by delivering to Contractor a written Notice of
                  such termination (a "Notice Of Termination") specifying the
                  extent of termination and the effective date.

         12.2     Contractor may, in its sole discretion, terminate this
                  Contract if Contractor determines that a termination is in
                  Contractor's best interest. Contractor shall notify Owner of
                  its decision to terminate by delivering to Owner a written
                  Notice of such termination (a "Notice Of Termination") at
                  least sixty (60) Days prior to the effective date.

         12.3     In the event either party has given a Notice of Termination,
                  and except as directed by Owner, Contractor shall immediately
                  proceed with the following obligations, regardless of any
                  delay in determining or adjusting any amounts due under this
                  clause:

                  12.3.1   stop Work as specified in the Notice.

                  12.3.2   issue no further subcontracts or purchase orders for
                           materials, services, or facilities, except as
                           necessary to complete the continued portion of the
                           Contract.

                  12.3.3   terminate all subcontracts and purchase orders to the
                           extent that they relate to the Work terminated.

                                                                   Page 41 of 72
<PAGE>   44
                  12.3.4   with approval of and at the direction of Owner,
                           settle all outstanding liabilities and termination
                           settlement proposals arising from the termination of
                           subcontracts and purchase orders or assign to Owner,
                           all of Contractors rights, titles, and interests in
                           the subcontracts terminated, in which case Owner
                           shall have the right to settle or to pay any
                           termination settlement proposal arising out of those
                           terminations.

                  12.3.5   as directed by Owner, Contractor shall transfer title
                           and deliver to Owner the fabricated parts,
                           unfabricated parts, Work in process, completed Work,
                           supplies, other material produced or acquired for the
                           Work terminated, completed or partially completed
                           plans, drawings, information, and other property
                           that, if this Contract had been completed, would be
                           required to be furnished to Owner.

                  12.3.6   complete performance in accordance with this Contract
                           of all of the Work not terminated.

                  12.3.7   take any action that may be necessary, or that Owner
                           may direct, for the protection and preservation of
                           the property related to this Contract that is in the
                           possession of Contractor and in which Owner has or
                           may acquire an interest.

                  12.3.8   use its best efforts to sell, only as authorized by
                           Owner, any property of the types referred to in
                           subparagraph 12.3.5 above provided. However,
                           Contractor is not required to extend credit to any
                           purchaser and may acquire the property under the
                           conditions prescribed and at prices approved by
                           Owner. The proceeds of any transfer or disposition
                           will be applied to reduce any payments to be made by
                           Owner under this Contract or paid in any other manner
                           directed by Owner.

         12.4     Contractor shall submit to Owner a list of termination
                  inventory not previously disposed of and excluding items
                  authorized for disposition by Owner. Within forty-five (45)
                  Days of receipt of this list, Owner will accept title to those
                  items.

         12.5     After termination, Contractor shall submit a final termination
                  settlement proposal to Owner, which includes wind down cost,
                  pro-rata portions of the G&A Fee and Base Fee and an adjusted
                  Award Fee in the form and with the certification prescribed by
                  Owner. Contractor shall submit the proposal promptly, but no
                  later than ninety (90) Days from the effective date at
                  termination, unless extended in writing by Owner upon written
                  request of Contractor within such ninety (90) Day period.
                  However, if Owner determines that the facts justify it, a
                  termination settlement proposal may be received and acted on
                  after ninety (90) Days or any reasonable extension thereof. If
                  Contractor fails to submit the proposal within the time
                  allowed, Owner may determine, on the basis of information
                  available, the

                                                                   Page 42 of 72
<PAGE>   45
                  amount, if any, due Contractor because of the termination and
                  shall pay the amount determined.

         12.6     With respect to terminated Work, Contractor shall be paid the
                  Cost of the Work, the G&A Fee and Base Fee applicable thereto
                  incurred prior to the effective date of the termination, and
                  such amount of the Award Fee as Owner deems proper in its sole
                  and absolute discretion. However, the total amount paid to
                  Contractor for the Cost of the Work may not exceed the
                  Contract Budget with respect thereto as reduced by the amount
                  of payments previously made. The Contract shall be amended,
                  and Contractor paid the agreed amount.

         12.7     In no event shall Contractor be entitled to any lost profits
                  or other consequential or indirect damages as a result of a
                  partial or complete termination, or any breach of this
                  Contract by Owner.

13       SUSPENSION OF ALL OR PART OF WORK

         13.1     Owner may at any time and for any reason, order, in writing,
                  Contractor to suspend, all or any part of the Work required
                  under this Contract for the period of time that Owner
                  determines appropriate for the convenience of Owner.

         13.2     If the performance of all or any part of the Work is suspended
                  pursuant to Section 13.1 by an act of Owner in the
                  administration of this Contract and affects the critical path
                  of Work, by Owner's failure to act within the time specified
                  in this Contract (or within a reasonable time if not
                  specified), an adjustment in the relevant Contract Budget or
                  Completion Date shall be made pursuant to a Change Order for
                  any increase in the cost or time for the performance of this
                  Contract necessarily caused by the suspension by Owner.

         13.3     No change of a Contract Budget or Completion Date shall be
                  made under this Section 13 based on any suspension caused by
                  Owner if Contractor's performance would have been so suspended
                  by any other cause, including the fault or negligence of
                  Contractor, a Subcontractor, a Vendor or anyone for whom any
                  of them may be responsible, or for which a price adjustment or
                  extension of any Completion Date is provided for or excluded
                  under any other term or condition of this Contract.

         13.4     During periods that Work is suspended, Contractor shall be
                  responsible for the Work under this Contract and shall prevent
                  damage to the Project, provide for drainage, and shall erect
                  necessary temporary structures, signs, or other facilities
                  required to maintain the Project. During any suspension
                  period, Contractor shall maintain in a growing condition all
                  newly established plantings, seedlings, and

                                                                   Page 43 of 72
<PAGE>   46
                  soddings furnished under the Contract, and shall protect new
                  tree growth and other vegetative growth against injury.

14       [NOT USED]

         14.1     Not Used.

15       INSURANCE

         15.1     Owner Controlled Insurance Program. Owner, through its Owner
                  Controlled Insurance Program ("OCIP"), will provide at its
                  expense (which shall not be part of the Cost of the Work)
                  certain insurance coverages for Contractor and certain
                  Subcontractors, after completion of the enrollment process for
                  Contractor and eligible Subcontractors. In addition to any
                  insurance provided by Owner, Contractor shall be responsible
                  for providing certain insurance as specified below.

         15.2     Coverage to be Provided by Owner. The coverages to be provided
                  through the OCIP (the "Coverages") include builders' risk
                  property insurance, commercial general liability insurance
                  (excluding automobile liability), railroad protective
                  liability as required by the railroads and statutory workers'
                  compensation insurance and employer's liability insurance, as
                  more specifically described below. The Coverages provided will
                  apply to the operations of Contractor and each eligible and
                  enrolled (as hereinafter described) Subcontractor and other
                  insureds at the Site. Off-Site operations of Contractor and
                  eligible Subcontractors in performance of Work will be covered
                  only if all operations at such site are identified and solely
                  dedicated to the Work. Contractor shall be responsible for
                  advising Owner of its intention to establish a dedicated
                  off-site location, and to request OCIP coverage approval for
                  such sites or operations. The coverage provided by Owner will
                  be subject to terms, conditions and other provisions,
                  including exclusions and limitations, contained in the
                  insurance policies issued to Owner.

                  15.2.1   Liability Coverage. The OCIP will provide the
                           following liability coverage to Contractor and all
                           eligible and enrolled Subcontractors during the
                           period starting on the date of issuance of the Notice
                           to Proceed for Contractor (or such other date as
                           mutually agreed) and for each eligible and enrolled
                           Subcontractor starting on the date of commencement of
                           Work by such Subcontractor, and ending on the Final
                           Acceptance Date (or other period specified below):

                           15.2.1.1         Commercial general liability
                                            (including umbrella or excess
                                            liability coverage as necessary to
                                            achieve required limits) for bodily
                                            injury, property damage, personal
                                            injury and advertising injury,
                                            including contractual liability,
                                            completed

                                                                   Page 44 of 72
<PAGE>   47
                                            operations and products liability:
                                            Limits will be $100,000,000 per
                                            occurrence; with general aggregate
                                            limits of $100,000,000 and
                                            products/completed operations
                                            aggregate limits of $100,000,000.
                                            Limits are annual limits of
                                            liability shared by all insureds.
                                            Primary coverage will use Insurance
                                            Services' Office commercial general
                                            liability "occurrence" form CG 0001
                                            (or its equivalent) specifically
                                            including coverage for liability
                                            arising out of an agreement or
                                            contract in connection with
                                            construction or demolition
                                            operations on or near any railroad,
                                            with no exclusion for explosion,
                                            collapse or underground hazards. No
                                            coverage will be provided for
                                            products liability for any product
                                            manufactured, assembled, or
                                            otherwise worked upon away from the
                                            Site, unless such manufacturing or
                                            assembly is expressly required by
                                            the terms of the Contract.
                                            Products/completed operations
                                            coverage will remain in effect for
                                            ten (10) years from the date of
                                            Final Acceptance. The limit of
                                            liability for the extended
                                            products/completed operations
                                            coverage applies as a one (1) time
                                            separate aggregate limit for the
                                            entire period of the ten-year
                                            extension. The addition of insureds
                                            shall not operate to increase such
                                            limit. Coverage also includes sudden
                                            and accidental pollution occurrences
                                            subject to compliance with certain
                                            notification requirements.

                           15.2.1.2         Railroad protective liability: as
                                            required by the railroad agreements.

                  Owner shall demand reinstatement of any limits of liability,
                  which have been exhausted due to claim of Owner's other
                  contractors. Owner shall use best efforts to notify Contractor
                  in the event annual aggregate reserves are less than
                  $50,000,000.

                  15.2.2   Workers' Compensation Coverage. During the period
                           commencing on the date of issuance of the Notice to
                           Proceed (or such other date as mutually agreed) and
                           ending on the Final Acceptance Date, Contractor and
                           all eligible and enrolled Subcontractors will, at
                           Owner's expense, be covered under the applicable laws
                           relating to workers' compensation and employer's
                           liability insurance, for all of their employees
                           performing construction Work at the Site and at
                           dedicated off-Site locations approved by Owner and
                           its insurer except as specified below. Contractor and
                           each eligible and enrolled Subcontractor will be
                           issued a separate workers' compensation employer's
                           liability policy which will continue until the
                           earlier to occur of

                                                                   Page 45 of 72
<PAGE>   48
                           the Final Acceptance Date or until all Site
                           activities have been completed. No coverage will be
                           provided for any warranty or other Work performed
                           following Final Acceptance. In no event shall the
                           provision of the Coverages or the OCIP render Owner
                           an employer with respect to Contractor or
                           Subcontractor.

                           15.2.2.1 Owner will not provide workers' compensation
                                    coverage in any of the monopolistic state
                                    fund states, or Canada. Contractor must
                                    provide its own workers' compensation
                                    coverage in these states or Canada.

                  15.2.3   Property Insurance. The OCIP will include builder's
                           risk property insurance, which shall protect against
                           property loss as specified below during the period
                           starting on the date of issuance of the Notice to
                           Proceed and ending on the Final Acceptance Date.

                           15.2.3.1 Minimum Scope. The property insurance will
                                    cover all real and tangible personal
                                    property to be incorporated into the Work
                                    for "all risks" of loss, subject to standard
                                    policy terms, conditions and exclusions,
                                    covering all buildings, structures,
                                    fixtures, materials and supplies at the Site
                                    including inland transit and off-Site
                                    storage.

                           15.2.3.2 Exclusions. The OCIP property insurance will
                                    not cover any personal property of
                                    Contractor or Subcontractor, including
                                    tools, equipment, scaffolding, staging
                                    towers, and forms, rented or owned by
                                    Contractor or any Subcontractor, the capital
                                    value of which is not included in the Cost
                                    of the Work or any shanties or other
                                    structures erected for the sole convenience
                                    of the workers. Owner will not be
                                    responsible for any loss or damage to said
                                    excluded items, and the indemnifications by
                                    Contractor set forth in the Contract shall
                                    include any claims or causes of actions
                                    brought by any Person as a result of loss or
                                    damage to such excluded items.

         15.2.4   Contractor and Owner Responsibility for Deductibles and
                  Self-Insured Retentions. Owner will be responsible for
                  deductibles or self-insured retentions with respect to the
                  Coverages. However, Owner's responsibility will apply only
                  after Contractor has paid any amounts for loss or damage
                  specified below, irrespective of the actual insurance policy
                  deductible. Contractor's obligation to pay these amounts
                  (which shall not be part of the Cost of the Work) shall remain
                  uninsured and will not be covered by the OCIP Coverages.

                                                                   Page 46 of 72
<PAGE>   49
                           15.2.4.1 Commercial General Liability Policy. With
                                    respect to any claims under the policy
                                    described in Section 15.2.1.1, Contractor
                                    shall pay the first $5,000 per occurrence to
                                    the extent losses payable are attributable
                                    to acts or omissions of Contractor, its
                                    employees, agents, officers or
                                    Subcontractors or any other Persons
                                    performing any of the Work for whom
                                    Contractor may be contractually or legally
                                    responsible.

                           15.2.4.2 Builders' Risk. With respect to any claims
                                    under the policy described in Section
                                    15.2.3, Contractor shall pay the first
                                    $25,000 per occurrence for all perils to the
                                    extent losses payable are attributable to
                                    acts or omissions of Contractor, its
                                    employees, agents, officers or
                                    Subcontractors or any other Persons
                                    performing any of the Work for whom
                                    Contractor may be contractually or legally
                                    responsible.

                  15.2.5   Eligibility of Subcontractors for Coverage.
                           Subcontractors shall be eligible for coverage under
                           the OCIP only if they perform Work at the Site and/or
                           a pre-approved dedicated off-Site location. With
                           respect to the worker's compensation and employer's
                           liability policies, coverage will be provided only
                           for certain workers, as specified in Section 15.2.2.
                           No insurance coverage provided by Owner under the
                           OCIP shall extend to the activities or products of
                           the following:

                           15.2.5.1 any person and/or organization that
                                    fabricates and/or manufactures products,
                                    materials and/or supplies away from the
                                    Site;

                           15.2.5.2 any architect, engineer, soil tester, or
                                    surveyor and their consultants except where
                                    required by Contract;

                           15.2.5.3 truckers, material dealers, vendors,
                                    suppliers, and owner/operators (independent
                                    contractors), whose operations(s) and/or
                                    employee(s) is/are engaged solely in the
                                    loading, hauling and/or unloading of
                                    material, supplies and/or equipment to or
                                    from the Site;

                           15.2.5.4 unless such employee(s) is/are dedicated
                                    full time to the Work, as evidenced by
                                    payroll records, any employee(s) of an
                                    enrolled Contractor or Subcontractor of any
                                    tier, which is/are engaged solely in the
                                    loading, hauling and/or

                                                                   Page 47 of 72
<PAGE>   50
                                    unloading of material, supplies and/or
                                    equipment to or from the Site;

                           15.2.5.5 any employee(s) of an enrolled Contractor
                                    and Subcontractor of any tier, that does not
                                    work and/or generate payroll at the Site;

                           15.2.5.6 any employee(s) of an enrolled Contractor
                                    and Subcontractor of any tier, that
                                    occasionally visits the Site to make
                                    deliveries, pick up supplies and or
                                    personnel, to perform supervisory and/or
                                    progress inspection, or for any other
                                    reason,

                           15.2.5.7 any day labor employees (labor service
                                    employees whose coverage is provided by
                                    their employer); or

                           15.2.5.8 any other entity specifically determined by
                                    Owner to be excluded.

                  15.2.6   Cooperation. Contractor and all Subcontractors shall
                           cooperate fully in the implementation and
                           administration of the OCIP and provide any
                           information or records requested by Owner or its
                           insurance representative regarding all aspects of the
                           OCIP, including claims, audit, payroll records and
                           safety procedures. Delays in reporting information to
                           Owner or its insurance representative will result in
                           delays in payment to Contractor. Contractor and all
                           Subcontractors shall comply with the terms and
                           conditions of the Coverages.

                  15.2.7   Verification of Coverage. Contractor shall
                           acknowledge that it has received copies of binders or
                           other appropriate evidence of coverage with respect
                           to the OCIP. Owner will deliver copies of each
                           original workers' compensation policy to Contractor
                           promptly upon Owner's receipt thereof.

         15.3     Insurance Coverage to be Provided by Contractor and
                  Subcontractors. Contractor shall provide insurance as
                  described herein and ensure that all Subcontractors provide
                  insurance as described herein, and shall ensure that all such
                  insurance is maintained in full force and effect as specified
                  herein from the date of issuance of the Notice to Proceed to
                  the date of expiration of the warranty period hereunder. All
                  insurance is to be placed with insurers admitted as such at
                  the locations of the Work with an A.M. Best and Company rating
                  level of A- or better, Class VII or better, or as otherwise
                  approved by Owner in its sole discretion.

                                                                   Page 48 of 72
<PAGE>   51
                  15.3.1   Required Coverage. Contractor and Subcontractors
                           shall provide and maintain liability insurance as
                           specified below. Contractor's commercial general
                           liability insurance for off-Site exposures,
                           automobile liability and aircraft liability (if
                           applicable) policies shall protect Contractor, and to
                           the extent of Contractor's indemnity obligations
                           contained in the Contract protect Owner, and any
                           other persons required in writing to be added as
                           additional insureds to Contractor's coverage.

                  15.3.2   Minimum Scope. Liability insurance shall include the
                           following (or broader) coverage.

                           15.3.2.1 Insurance Services Office commercial general
                                    liability coverage "occurrence" form CG 0001
                                    (Ed. 11/88), or its equivalent, with no
                                    exclusion for explosion, collapse or
                                    underground hazards, only as respects
                                    Contractor operations and exposures
                                    off-Site;

                           15.3.2.2 Insurance Service Office form number CA 0001
                                    (Ed. 1/87) or equivalent covering Automobile
                                    Liability, including hired and non-owned
                                    automobile liability;

                           15.3.2.3 workers' compensation insurance complying
                                    with the applicable worker's compensation
                                    laws, including employer's liability,
                                    specifically limiting coverage to exclude
                                    payroll covered under the OCIP. Contractor
                                    and Subcontractors must supply workers'
                                    compensation coverage in all monopolistic
                                    state fund states and Canada;

                           15.3.2.4 aircraft liability insurance in all cases
                                    where any aircraft is used on the Project
                                    that is owned, leased or chartered by
                                    Contractor or any of its employees, agents,
                                    officers, or Subcontractors or other Persons
                                    for whom Contractor may be legally or
                                    contractually responsible, protecting
                                    against claims for damages resulting from
                                    such use. The policy shall include coverage
                                    for hull damage covering the aircraft hull,
                                    engines and all aircraft equipment for "all
                                    risks" of damage for the full replacement of
                                    the aircraft, and liability insurance for
                                    bodily injury (including death), passenger
                                    liability and property damage liability. Any
                                    aircraft intended for use in performance of
                                    the Work, the aircraft crew, flight path and
                                    altitude, including landing of any aircraft
                                    on the Site or on any property owned by
                                    Owner shall be subject to review and
                                    acceptance by Owner prior to any such usage

                                                                   Page 49 of 72
<PAGE>   52
                                    occurs. If any aircraft are leased or
                                    chartered with crew and/or pilot, evidence
                                    of non-owned aircraft liability insurance
                                    will be acceptable but must be provided
                                    prior to use of the aircraft;

                           15.3.2.5 professional liability insurance policy
                                    (including errors and omissions). Such
                                    coverage shall be continued for a period of
                                    not less than three (3) years after
                                    acceptance of the completed Project by Owner
                                    and evidence to this effect will be provided
                                    to Owner in the form of annual certificates
                                    of insurance. Contractor shall cause its
                                    insurer for this coverage to notify Owner of
                                    any reduction in coverage or material change
                                    within thirty (30) Days of such change.
                                    Where professional services are performed by
                                    a Subcontractor, evidence of coverage from
                                    Subcontractor shall satisfy this
                                    requirement.

                  15.3.3   Limits. The limits for such policies are:

                           15.3.3.1 commercial general liability (for bodily
                                    injury, property damage, personal injury and
                                    advertising injury): $5,000,000 per
                                    occurrence and in the aggregate for
                                    Contractor and $1,000,000 per occurrence and
                                    in the aggregate for Subcontractors.
                                    Contractor shall provide this policy on a
                                    project specific basis, and the cost thereof
                                    shall not be a Cost of the Work.

                           15.3.3.2 automobile liability (for bodily injury and
                                    property damage): $5,000,000 per accident
                                    for Contractor and $1,000,000 per accident
                                    for Subcontractors.

                           15.3.3.3 workers' compensation and employer's
                                    liability (for bodily injury or disease):
                                    Statutory limits for workers' compensation
                                    and $1,000,000 per accident for employer's
                                    liability.

                           15.3.3.4 aircraft liability: $50,000,000 per
                                    occurrence.

                           15.3.3.5 professional liability: $10,000,000 per
                                    claim.

         15.4     Additional Coverage to be Provided by Contractor and
                  Subcontractor. During (i) the period prior to
                  Contractors/Subcontractors enrollment into the OCIP and (ii)
                  the period following the Final Acceptance Date and prior to
                  expiration of the warranty period hereunder, Contractor and
                  Subcontractors shall maintain in full

                                                                   Page 50 of 72
<PAGE>   53
                  force and effect all insurance as specified in Section 15.3,
                  covering all Work performed during such periods.

         15.5     Other Insurance Requirements.

                  15.5.1   Endorsements and Waivers. Liability insurance
                           policies required to be provided by Contractor
                           hereunder shall contain or be endorsed to contain the
                           following provisions:

                           15.5.1.1 Owner, its members, directors, officers,
                                    employees and agents and such other parties
                                    as may be designated in writing shall, to
                                    the extent of Contractor's indemnity
                                    obligations contained in the Contract, be
                                    covered as additional insureds under
                                    Contractor's and Subcontractor's commercial
                                    general liability policies, up to the limits
                                    required in Section 15.3.3.l.

                           15.5.1.2 Contractor's and Subcontractor's commercial
                                    general and automobile liability insurance
                                    shall apply separately to each insured
                                    against whom a claim is made or suit is
                                    brought, except with respect to the limits
                                    of the insurer's liability.

                           15.5.1.3 Each policy (including the workers
                                    compensation and employer's liability
                                    policies) shall include a waiver of any
                                    right of subrogation against Owner, (and its
                                    members, directors, officers, employees and
                                    agents).

                           15.5.1.4 Each policy (including the worker's
                                    compensation and employer's liability
                                    policies) shall be endorsed to state that
                                    coverage shall not be suspended, voided,
                                    canceled or reduced in coverage or in limits
                                    except after sixty (60) Days' prior written
                                    notice by certified mail, return receipt
                                    requested, has been given to Owner. Such
                                    endorsement shall not include any limitation
                                    of liability of the insurer for failure to
                                    provide such notice.

                  15.5.2   Verification of Coverage.

                           15.5.2.1 Contractor agrees to deposit with Owner, on
                                    or before the date of issuance of the Notice
                                    to Proceed, certificates of insurance and
                                    required endorsements for all policies
                                    required to be provided under Section 15.3.

                                                                   Page 51 of 72
<PAGE>   54
                           15.5.2.2 Not less than fifteen (15) Days prior to the
                                    expiration date of any policy of insurance
                                    required by Section 15.3, Contractor shall
                                    deliver to Owner a binder or certificate of
                                    insurance with respect to each renewal
                                    policy. Required endorsements and
                                    certificates of insurance applicable to each
                                    renewal policy shall be delivered to Owner
                                    within thirty (30) Days of the renewal date.

         15.6     Owner's Right to Remedy Breach by Contractor. If Contractor
                  fails to provide insurance as required herein, Owner shall
                  have the right but not the obligation, to purchase such
                  insurance. In such event Owner shall be entitled to withhold
                  any premiums paid from such amount which may currently be due
                  Contractor or which shall become due Contractor in the future.

         15.7     Disclaimer. Contractor acknowledges that Owner is not an
                  agent, partner or guarantor of the OCIP insurers, and is not
                  responsible for any claims or disputes between Contractor or
                  its Subcontractors and the OCIP insurers. Contractor shall
                  obtain a similar acknowledgment from all Subcontractors
                  covered by the OCIP. Any type of insurance coverage or
                  increase in limits not provided by the OCIP which Contractor
                  or its Subcontractors require for their own protection or on
                  account of statute, will be the responsibility of Contractor
                  and each Subcontractor at its own expense. The Coverages are
                  set forth in full in the respective insurance policy forms and
                  the description of such policies contained herein or in
                  Owner's project insurance manual are not intended to be
                  complete or to alter or amend any provision of the actual
                  insurance policies and in matters, if any, in which the
                  description herein conflicts with such policies, the
                  provisions of the actual insurance policies shall govern.

         15.8     Owner's Right to Modify Insurance Program. Owner reserves the
                  option to exclude Contractor or any Subcontractor from the
                  OCIP or to terminate the OCIP, in whole or in part, at any
                  time upon ninety (90) Days' written notice to Contractor, and
                  also reserves the option, at any time, to require additional
                  insurance to be provided by Contractor/Subcontractor or to
                  revise the requirements for Contractor/Subcontractor-provided
                  insurance. Any such action shall be deemed an Owner directed
                  change entitling Contractor/Subcontractor to an increase for
                  the costs incurred by Contractor/Subcontractor due to such
                  change (with an appropriate change to the Contract Budget)
                  (i.e., the cost of procuring substitute coverage for the OCIP
                  coverage no longer being provided and the cost of any
                  additional insurance required to be provided by
                  Contractor/Subcontractor. Contractor/Subcontractor shall
                  provide to Owner all such information or records as may be
                  required or helpful in determining Contractor's/
                  Subcontractor's costs.

                                                                   Page 52 of 72
<PAGE>   55
         15.9     Subcontractor Insurance Requirements. Each subcontract with a
                  Subcontractor eligible for OCIP coverage shall provide that
                  the Subcontractor agrees to participate in the OCIP.
                  Contractor shall ensure that all Subcontractors are required
                  to comply with all applicable insurance requirements contained
                  in the Contract and with all requirements imposed by the
                  insurance policies. Contractor shall have sole responsibility
                  for monitoring Subcontractor's compliance with such
                  requirements. Contractor shall require each Subcontractor to
                  include Owner and such other persons who are identified in
                  writing to be added as additional insureds to Subcontractor's
                  coverage. Owner and its designated agent shall have the right
                  to contact Subcontractors directly in order to verify the
                  above coverages.

         15.10    Other Conditions.

                  15.10.1  Dividends or Return Premiums. The cost of premiums
                           for the Coverages will be paid by Owner. Owner will
                           receive and pay, as the case may be, all adjustments
                           in such costs by way of dividend, return premium,
                           retrospective adjustment or otherwise. Contractor
                           hereby relinquishes any claims to such dividends,
                           retentions, retrospective premium adjustments or
                           other form of return premium, and agrees to execute
                           and deliver to Owner any and all instruments of
                           assignment as may be requested by Owner to confirm
                           its right to receive the same. Contractor shall
                           obtain a similar relinquishment and agreement to
                           provide further assurances from all Subcontractors
                           eligible for OCIP coverage. Rights of cancellation of
                           all policies provided to Contractor and Subcontractor
                           by Owner are assigned to Owner.

                  15.10.2  Property Loss Insurance Proceeds. Contractor agrees,
                           and shall obtain a similar agreement from all
                           Subcontractors, that any insurance recoveries for
                           property loss covered under the property insurance
                           shall be for the account of Owner and payable to
                           Owner.

                  15.10.3  Due Care Required. Nothing contained in this Section
                           shall relieve Contractor or any Subcontractor of its
                           obligation to exercise due care in the performance of
                           the Work and to complete the Work in strict
                           compliance with this Contract.

                  15.10.4  Disclaimer. Nothing contained in this Section shall
                           in any way act as a limitation of the liability of
                           Contractor, Subcontractor or anyone for whom any of
                           them may be liable legally or contractually, for
                           damage or injury, including death, which arises out
                           of the obligations of Contractor, Subcontractor or
                           any one for whom any

                                                                   Page 53 of 72
<PAGE>   56
                           of them may be liable legally or contractually, under
                           this Contract or the applicable subcontract. Further,
                           in no event shall the OCIP or Owner's decision to
                           include or exclude any Work, Contractor or
                           Subcontractors from or in the OCIP create any
                           liability on Owner's part.

         15.11    Contractor Obligations.

                  15.11.1  Contractor shall enroll in the OCIP by obtaining the
                           necessary information and forms from Owner or its
                           designee. In addition, Contractor shall notify its
                           Subcontractors of the procedure for enrolling in the
                           OCIP. Contractor and its Subcontractors, of any tier,
                           shall not commence work until all insurance
                           requirements are met. These requirements in part
                           include: Contractor furnishing (and causing each of
                           its Subcontractor's at any tier to furnish) to Owner
                           or its designee, in a form satisfactory to Owner, an
                           estimate of labor costs (listed by Standard Workers'
                           Compensation Insurance classification) to be incurred
                           in connection with Work at the Site, other insurance
                           related information that Owner or the insurer may
                           need to effect and maintain Owner provided coverage.

                  15.11.2  Contractor shall not violate any conditions of the
                           Coverages. All requirements imposed by the Coverages
                           upon, and to be performed by, Contractor shall
                           likewise be imposed on, assumed and performed by each
                           of the Subcontractors. The Contractor agrees and will
                           require each Subcontractor to agree to keep and
                           maintain an accurate and classified record of its
                           payroll data and information in accordance with the
                           requirements of the insurance company or companies
                           issuing the Coverages or as otherwise required. The
                           Contractor and their Subcontractors agree to permit
                           their books and records to be examined and audited
                           periodically by the insurance company or companies
                           issuing the Coverages, Owner or their respective
                           representatives.

                  15.11.3  Contractor shall furnish each bidding and negotiating
                           Subcontractor eligible for coverage under the OCIP, a
                           copy of this Section 15 of the Contract and shall
                           make the same requirement of their eligible
                           Subcontractors.

                  15.11.4  Contractor will be required to participate in the
                           claim reporting procedures of the OCIP. Contractor
                           agrees to assist and cooperate in every reasonable
                           manner possible in connection with the adjustment of
                           all claims arising out of operations within the scope

                                                                   Page 54 of 72
<PAGE>   57
                           of the Work provided for by the applicable Contract,
                           and to cooperate with the insurer in all claims and
                           demands which Owner's insurers are called upon to
                           adjust or to defend against. Contractor shall take
                           all necessary action to assure that its
                           Subcontractors, of all tiers, comply with any such
                           request for assistance and cooperation.

                  15.11.5  Monthly Payroll Reports. All Contractors and their
                           Subcontractors of all tiers shall submit monthly
                           payrolls and worker-hour reports to Owner and/or its
                           designee on the OCIP-3: OCIP Monthly On-site Payroll
                           Report. The OCIP-3 reporting form will be provided to
                           all Contractors and Subcontractors at time of
                           enrollment into the OCIP. Failure to submit these
                           reports may result in funds being held or delayed
                           from monthly progress payments. An OCIP-3 must be
                           submitted for each month, including zero (0) payrolls
                           if applicable, until completion of the work under
                           each contract. For those Contractors/Subcontractors
                           performing Work under multiple Contracts, a separate
                           Payroll Report is required for each Contract under
                           which Work is being performed.

         15.12    Audit and Adjustment of Insurance Credits.

                  15.12.1  Owner, at its option and as applicable, may adjust
                           the amount and monies due the Contractor as
                           summarized below:

                  15.12.2  Initial Insurance Credit Eliminated from Bid.

                          15.12.2.1 Contractor and Subcontractors of any tier
                                    shall submit their bids excluding all cost
                                    for the Coverages described in Section 15.2.
                                    Contractor shall also identify those costs
                                    for insurance, which would be added back to
                                    its bid price should Owner elect to not
                                    include Contractor and/or Subcontractor in
                                    the OCIP. Contractor shall summarize its
                                    alternate cost for the Coverages to be
                                    provided by the OCIP, including
                                    Subcontractors of all tiers on the attached
                                    OCIP-1 and OCIP-2 forms.

                          15.12.2.2 If Owner elects to not include Contractor
                                    or any Subcontractor in the OCIP,
                                    Contractor's and/or Subcontractor's contract
                                    amount will be amended to include the
                                    insurance costs as indicated on the OCP-1
                                    form.

                  15.12.3  Cost per Payroll Dollar Rate.

                                                                   Page 55 of 72

<PAGE>   58
                          15.12.3.1 Upon acceptance of the Contractor in the
                                    OCIP, Owner and/or its designee will
                                    determine a cost per payroll dollar rate for
                                    the average cost of project site insurance
                                    based upon the information submitted on the
                                    OCIP-1 form. The cost per payroll dollar
                                    rate will be established by the following
                                    formula for the Work of each Contractor and
                                    each Subcontractor, of any tier, performed
                                    under this Contract.

                                    [Total Contractor Insurance Premiums
                                    multiplied by plus Award Fee percentage,
                                    Base Fee percentage & G&A Fee percentage)]
                                    divided by total payroll for the Contract
                                    cost = per payroll dollar rate.

16       INDEMNIFICATION

         16.1     To the fullest extent permitted by law, Contractor shall
                  defend, indemnify and hold harmless Owner and the Oversight
                  Engineer and any owner of Rights of Way required to be
                  indemnified by Owner, their successors and assigns and their
                  shareholders, officers, directors, agents and employees and
                  any affected third party or political subdivision, from and
                  against any and all claims, damages, losses, liabilities,
                  costs and expenses, including attorneys' fees, resulting from
                  claims of third parties to the extent such claims, damages,
                  losses, liabilities, costs and expenses, including attorneys'
                  fees arise out of, relate to or result from Contractor's
                  breach or failure to perform in accordance with the Contract,
                  or the negligence or willful misconduct of Contractor or
                  anyone for whom it is responsible or liable. Such obligation
                  shall not be construed to negate, abridge, or reduce other
                  rights or obligations of indemnity, which would otherwise
                  exist under this Contract.

         16.2     To the fullest extent permitted by law, Contractor shall
                  defend, indemnify and hold harmless Owner, the Oversight
                  Engineer and any owner of Rights of Way required to be
                  indemnified by Owner, their successors and assigns and their
                  shareholders, officers, directors, agents and employees, from
                  and against any and all claims by any governmental or taxing
                  Owner claiming taxes based on income of Contractor or any of
                  its Subcontractors or Vendors or any of their respective
                  agents or employees with respect to any payment for the work
                  made to or earned by Contractor or any of its Subcontractors
                  or Vendors or any of their respective agents or employees
                  under this Contract.

         16.3     To the fullest extent permitted by law, Contractor shall
                  defend and hold harmless Owner, the Oversight Engineer and any
                  owner of Rights of Way required to be indemnified by Owner,
                  their successors and assigns and their shareholders, officers,
                  directors, agents and employees and any affected third party
                  or political

                                                                   Page 56 of 72
<PAGE>   59
                  subdivision, from and against any and all claims, damages,
                  losses, liabilities, costs and expenses, including attorneys'
                  fees, arising out of or relating to the failure of Contractor,
                  its employees, agents, officers, Vendors or Subcontractors or
                  any other Persons performing any of the Work to comply with
                  any applicable Governmental Rule.

         16.4     Contractor shall properly guard the Work and areas affected by
                  the Work to prevent any person or persons from being injured
                  by it or by the condition of the site, and shall in all
                  respects comply with any and all provisions of the law and of
                  local ordinances relating to the maintenance of danger
                  signals, barriers, lights, and similar safeguards respecting
                  falling materials and in and about all excavations,
                  protruding nails, hoists, openings, scaffolding, stairways,
                  other parts of the Work and adjacent areas where the same are
                  required.

         16.5     To the fullest extent permitted by law, Contractor shall
                  defend, indemnify and hold harmless Owner, the Oversight
                  Engineer and any owner of Rights of Way required to be
                  indemnified by Owner, their successors and assigns and their
                  shareholders, officers, directors, agents and employees and
                  any affected third party or political subdivision from and
                  against any and all claims for infringement resulting from the
                  use of any patented design, device, material or process, or
                  any trademark or copyright, and shall indemnify Owner for any
                  claims, damages, losses, liabilities, costs and expenses,
                  including attorneys' fees, which it may become obligated to
                  pay by reason of any infringement, during the prosecution or
                  after the completion of the Project, except to the extent such
                  claim arises out of Owner-Supplied Items. If Owner is enjoined
                  from completion of the Project or any part thereof, or from
                  the use, operation or enjoyment of the Project or any part
                  thereof as a result of such claim or legal action or any
                  litigation based thereon, Contractor shall promptly arrange to
                  have such injunction removed at no cost to Owner. Owner's
                  acceptance of Contractor's engineering design and/or proposed
                  or supplied materials and equipment shall not be construed to
                  relieve Contractor of any obligation hereunder.

         16.6     To the fullest extent permitted by law, Contractor shall
                  defend, indemnify and hold harmless Owner, the Oversight
                  Engineer and any owner of Rights of Way required to be
                  indemnified by Owner, their successors and assigns and their
                  shareholders, officers, directors, agents and employees from
                  and against any and all Claims for non-payment filed in
                  connection with the Work, including all expenses and
                  attorneys' fees incurred in discharging any Claims for
                  non-payment.

         16.7     The foregoing obligations shall not be construed to negate,
                  abridge, or reduce other rights or obligations, which would
                  otherwise exist in favor of a party indemnified hereunder.

                                                                   Page 57 of 72
<PAGE>   60
         16.8     In claims against any person or entity indemnified under this
                  Section 16 by an employee of Contractor, a Subcontractor, a
                  Vendor, anyone directly or indirectly employed by them or
                  anyone for whose acts they may be liable, the indemnification
                  obligation under this section shall not be limited by a
                  limitation on amount or type of damages, compensation or
                  benefits payable by or for Contractor or a Subcontractor under
                  workers' or workmen's compensation acts, disability benefit
                  acts or other employee benefit acts.

         16.9     In no event shall either party be liable to the other for any
                  indirect, consequential, special, punitive or exemplary
                  damages or lost profits, except to the extent such claims are
                  included in third party claims for which indemnification is
                  due hereunder. Without limiting Contractor's obligations with
                  respect to the Work, Owner waives and releases Contractor for
                  any damages for delay arising out of Contractor's failure to
                  achieve a Completion Date.

         16.10    Indemnities against, releases from, assumptions of and
                  limitations on liability expressed in this Contract, as well
                  as waivers of subrogation rights, shall apply even in the
                  event of the fault, negligence (whether active, passive, joint
                  or concurrent) or strict liability of the party indemnified or
                  released or whose liability is limited or assumed or against
                  whom rights of subrogation are waived and shall be effective
                  to, and only to, the maximum extent allowable by law and in
                  the event such provision is determined to exceed the maximum
                  scope allowed by law, said provision shall be interpreted and
                  enforced so as to preserve the indemnity, release or
                  limitation to the maximum extent allowable. Such indemnities
                  against, releases from, assumptions of and limitations on
                  liability expressed in this Contract, as well as waivers of
                  subrogation rights, shall extend to the officers, directors,
                  employees, licensors, agents, partners and related entities of
                  such party and its partners and related entities.

17       DEFAULT

         17.1     Default of Contract by Contractor. Contractor shall be
                  immediately in default hereunder (an "Event of Default") upon
                  the occurrence of any one or more of the other events or
                  conditions set forth below and continuation thereof for ten
                  (10) Days following delivery to Contractor of a Notice from
                  Owner to cure such event or condition; provided that if such
                  event or condition is susceptible of being cured but cannot
                  reasonably be cured within such ten (10) Day period and
                  Contractor commences to cure such event or condition within
                  such ten (10) Day period and continues to diligently prosecute
                  such cure then Contractor shall be entitled to a reasonable
                  period of time not exceeding ninety (90) Days to complete such
                  cure:

                  17.1.1       Contractor fails to promptly begin the Work under
                               the Contract; or

                                                                   Page 58 of 72
<PAGE>   61
                  17.1.2       Contractor fails to perform the Work with
                               sufficient workers and equipment or with
                               sufficient materials so as to give reasonable
                               assurance that Final Acceptance of all Work will
                               be achieved by the respective Completion Date; or

                  17.1.3       Contractor performs the Work not in accordance
                               with the requirements of this Contract or refuses
                               to remove and replace rejected materials or
                               unacceptable Work; or

                  17.1.4       Contractor refuses to remove any worker not
                               acceptable to owner; or

                  17.1.5       Contractor discontinues the prosecution of the
                               Work; or

                  17.1.6       Contractor fails to resume Work which has been
                               discontinued within a reasonable time after
                               Notice to do so; or

                  17.1.7       Contractor shall have become insolvent, or
                               generally does not pay its debts as they become
                               due, or admits in writing its inability to pay
                               its debts, or makes an assignment or the benefit
                               of credits; or

                  17.1.8       Contractor allows any final judgment against it
                               arising out of the prosecution of the Work to go
                               unsatisfied for more than thirty (30) Days; or

                  17.1.9       insolvency, receivership, reorganization, or
                               bankruptcy proceedings shall have been commenced
                               by or against Contractor; or

                  17.1.10      Contractor breaches any material agreement,
                               representation or warranty contained in this
                               Contract; or

                  17.1.11      Contractor shall have assigned or transferred
                               this Contract or any right or interest herein,
                               except as expressly permitted under Section 22.2;
                               or

                  17.1.12      any representation or warranty made by Contractor
                               in this Contract or any certificate, schedule,
                               instrument or other document delivered by
                               Contractor pursuant to this contract shall have
                               been false or materially misleading when made; or

                  17.1.13      Contractor shall have failed to make payment when
                               due for labor, equipment or materials in
                               accordance with its agreements with
                               Subcontractors or Vendors or shall have failed to
                               comply with any Governmental Rule or failed to
                               reasonably comply with the instructions of Owner
                               consistent with this Contract; or

                                                                   Page 59 of 72
<PAGE>   62
                  17.1.14      Contractor fails to achieve Final Acceptance of a
                               Network or Segment and all Work related thereto
                               by the relevant Completion Date.

         17.2     Remedies Upon Default by Contractor.

                  17.2.1       If an Event of Default shall have occurred and be
                               continuing that either is not curable under this
                               Contract or has not been cured within the period
                               allowed by the Contract, Owner or its assignee
                               shall have the following rights and remedies that
                               may be available to Owner, or such assignee, at
                               law or in equity, and Contractor shall have the
                               following obligations subject to the
                               reimbursement provisions of Section 6:

                               17.2.1.1     Owner, without prejudice to any of
                                            its other rights or remedies, may
                                            terminate this Contract forthwith by
                                            delivery of a Notice of Termination
                                            to Contractor.

                               17.2.1.2     Owner shall have the right to
                                            require Contractor to withdraw from
                                            the Site, assign Contractor's
                                            subcontracts or purchase agreements
                                            to Owner and remove materials,
                                            equipment, tools, instruments,
                                            debris, or waste materials from the
                                            site as Owner may direct, and Owner
                                            may take possession, without
                                            incurring any liability to
                                            Contractor, of any or all designs,
                                            drawings, and Site facilities of
                                            Contractor that Owner deems
                                            necessary to completion of the Work.

                               17.2.1.3     Owner shall have the right to take
                                            the prosecution of the Work from
                                            Contractor and Owner may appropriate
                                            or use Contractor's materials,
                                            equipment, tools and instruments
                                            located at the site of the Project
                                            which are to be consumed or
                                            incorporated in the Work as may be
                                            suitable and acceptable and may
                                            enter into an agreement for the
                                            completion of the Work in accordance
                                            with the terms and provisions of
                                            this Contract, or use other methods,
                                            as in the opinion of Owner, will be
                                            required for the completion of the
                                            Project.

                               17.2.1.4     Owner shall have the right to use
                                            all design and construction
                                            Documents and Specifications that
                                            have been prepared by Contractor.

         17.3     Default of Contract by Owner. If Owner fails to pay Contractor
                  any properly invoiced amount finally determined in a binding
                  proceeding to be due and payable in accordance with Section 6
                  hereof, Contractor may, upon thirty (30) Days'

                                                                   Page 60 of 72
<PAGE>   63
                  written notice to Owner, terminate this Contract and recover
                  from Owner payment for all Work performed and reasonable
                  termination expenses. If Owner cures its default by making
                  full payment of sums finally determined to be due and payable
                  before or during the Notice period, then Contractor shall not
                  be entitled to terminate the Contract. Payment of interest
                  shall not excuse or cure any default in payment.

         17.4     Upon a determination by a court of competent jurisdiction that
                  termination of Contractor or its successor in interest
                  pursuant to any provision of this Contract was wrongful, such
                  termination will be deemed converted to a termination for
                  convenience and the Contractor's remedies shall be limited to
                  those set forth in Section 12.5.

18       DISPUTE RESOLUTION

         18.1     In the event a dispute arises between Owner and Contractor
                  regarding the application, interpretation or breach of any
                  provision of this Contract, the aggrieved party shall promptly
                  notify the other party to this Contract of its intent to
                  invoke this dispute resolution procedure within fifteen (15)
                  Business Days after the dispute arises. If the parties shall
                  have failed to resolve the dispute within fifteen (15)
                  Business Days after delivery of such notice, each party shall,
                  within fifteen (15) Business Days thereafter nominate a senior
                  officer of its management to meet at any mutually agreed
                  location, to resolve the dispute in an amicable and peaceful
                  manner. Should the parties be unable to resolve the dispute to
                  their mutual satisfaction within fifteen (15) Business Days
                  after such nomination, each party shall have the right to
                  pursue litigation.

         18.2     Continuance Of Work During Dispute. At all times during the
                  course of the dispute resolution process and during the course
                  of litigation, Contractor shall continue with the Work as
                  directed, in a diligent manner and without delay, or conform
                  to Owner's decision or order, and shall be governed by all
                  applicable provisions of the Contract.

19       COOPERATION BETWEEN CONTRACTORS

         19.1     Owner reserves the right to contract for and perform other or
                  additional work, on or near the Work covered by this Contract.

         19.2     If other separate contracts are awarded within the limits of
                  the Work, Contractor shall conduct its Work without
                  unreasonably interfering or hindering the progress or
                  completion of the work being performed by other contractors.
                  All contractors working on the Project shall cooperate with
                  each other as directed by Owner.

                                                                   Page 61 of 72
<PAGE>   64
20       COMPLETION AND ACCEPTANCE

         20.1     Substantial Completion.

                  20.1.1   Contractor shall provide Notice to Owner when
                           Contractor has completed an entire Network or a
                           portion thereof, except for Punchlist items and final
                           clean up. Owner or the Oversight Engineer will
                           approve a Punchlist of items remaining to be
                           completed for Final Acceptance. By providing a Notice
                           of completion, Contractor has ensured that the
                           Network or Segment has been constructed in accordance
                           with the requirements of this Contract, may be
                           operated without damage to the Network, Segment, or
                           any other property on or off the Site, without injury
                           to any Person, and is ready for initial operation.

                  20.1.2   Within thirty (30) Days after receipt of Notice
                           pursuant to Section 20.1.1, Owner shall advise
                           Contractor in writing of any defects, deficiencies or
                           deviations from the Contract requirements or
                           workmanship. Contractor shall, at its own cost and
                           expense, correct such defects, deficiencies and/or
                           deviations immediately. As soon as any such defects,
                           deficiencies and/or deviations are corrected (or as
                           soon as the thirty (30) Day period for such notice
                           has expired if Owner does not advise Contractor of
                           any such items within the period), Owner shall accept
                           such Work in writing or they shall be deemed
                           accepted.

                  20.1.3   Substantial Completion of a Network or any Segment,
                           as the case may be, and the Work with respect thereto
                           ("Substantial Completion") shall be deemed to have
                           occurred on the earlier of

                           20.1.3.1 beneficial use or occupancy by Owner; or

                           20.1.3.2 when all of the following have occurred:

                                    20.1.3.2.1       Contractor has corrected,
                                                     pursuant to the provisions
                                                     of Section 20.1.2, all
                                                     defects, deficiencies
                                                     and/or deviations in
                                                     respect of the Network or
                                                     Segment, as the case may
                                                     be, and Owner has accepted
                                                     such corrections in
                                                     writing;

                                    20.1.3.2.2       Contractor has received all
                                                     the required Governmental
                                                     Approvals pursuant to
                                                     Section 3.1.2;

                                    20.1.3.2.3       Owner's Approval has been
                                                     given to a Punchlist in
                                                     respect of the Network or
                                                     Segment;

                                                                   Page 62 of 72
<PAGE>   65
                                    20.1.3.2.4       all authorities having
                                                     jurisdiction over the
                                                     Network or Segment, as the
                                                     case may be, have given
                                                     their approval of the
                                                     Network or Segment, as the
                                                     case may be, for use for
                                                     its intended purpose; and

                                    20.1.3.2.5       the entire Network or
                                                     Segment, as the case may
                                                     be, is fully operational
                                                     and available to be
                                                     utilized by Owner for its
                                                     intended purposes.

         20.2     Partial Acceptance. If at any time during the prosecution of
                  the Project, Contractor achieves, in regard to a Network or
                  Segment, satisfaction with respect to the Network or Segment,
                  of all conditions and terms set forth in regard to Segments in
                  Section 20.3, and upon written notice requesting same, Owner
                  may, but shall not be required to, accept said Network or
                  Segment ("Partial Acceptance").

         20.3     Final Acceptance of a Segment.

                  20.3.1   Promptly after Substantial Completion of a Network or
                           Segment, Contractor shall perform all Work, if any,
                           which was waived for purposes of Substantial
                           Completion, and shall satisfy all other of its
                           obligations under this Contract, including ensuring
                           that the Network or Segment has been completed and
                           all components have been properly adjusted and
                           tested.

                  20.3.2   Final acceptance ("Final Acceptance") of a Network or
                           Segment shall be deemed to have occurred when all of
                           the following have occurred:

                           20.3.2.1 all requirements of the Contract with
                                    respect thereto shall have been fully
                                    satisfied and all requirements for
                                    Substantial Completion of the subject
                                    Network or Segment shall have been fully
                                    satisfied; and

                           20.3.2.2 Owner shall have received all Drawings
                                    (including as-built drawings of the subject
                                    Segment), Specifications, test data, and
                                    other technical information required
                                    hereunder related to the subject Network or
                                    Segment; and

                           20.3.2.3 all special tools purchased by Contractor
                                    as, provided herein shall have been
                                    delivered to Owner and all replacement spare
                                    parts shall have been purchased for delivery
                                    to Owner free and clear of liens; and

                                                                   Page 63 of 72
<PAGE>   66
                           20.3.2.4 all Contractor's and Subcontractor's
                                    personnel, supplies, equipment, waste
                                    materials, rubbish and temporary facilities
                                    shall have been removed from the Site; and

                           20.3.2.5 Contractor shall have delivered to Owner a
                                    certification to the effect that Contractor
                                    claims no additional charges or adjustments
                                    pursuant to Section 11 or otherwise, other
                                    than those charges or adjustments of which
                                    Contractor has notified Owner; and

                           20.3.2.6 the Punchlist items shall have been
                                    completed to the reasonable satisfaction of
                                    Owner and all of Contractor's other
                                    obligations under this Contract shall have
                                    been satisfied in full or waived, provided
                                    that Contractor may delay completion of any
                                    landscaping and planting contained in the
                                    Punchlist in accordance with generally
                                    recognized forestry and landscaping
                                    practices, but in no case longer than nine
                                    (9) months, and Owner shall have delivered
                                    to Contractor a Notice of Final Acceptance
                                    to the effect of the foregoing.

                  20.3.3   The occurrence of the Final Acceptance Date shall not
                           relieve Contractor from any of its continuing
                           obligations hereunder.

                  20.3.4   The date which Final Acceptance of the Network or
                           Segment or a specified portion thereof occurs shall
                           be the "Final Acceptance Date".

                                                                   Page 64 of 72
<PAGE>   67
21       WARRANTY

         21.1     Contractor's warranties in respect of the Work (the
                  "Warranties") are as follows. Contractor warrants to Owner
                  that:

                  21.1.1   all Construction Work shall be performed in a good
                           and workmanlike manner and be free from defects;

                  21.1.2   materials and equipment furnished under this Contract
                           shall be of good quality and new and be free from
                           defects;

                  21.1.3   all professional services Work will be consistent
                           with the standard of care and diligence practiced by
                           recognized professionals performing similar services,
                           and be free from material defects; and

                  21.1.4   all Work shall meet all of the requirements of this
                           Contract.

         21.2     Owner shall look to the vendor or manufacturer for warranty
                  claims on Owner-Supplied Items or items specifically required
                  by Owner, provided Contractor shall provide reasonable
                  assistance in enforcement of same.

         21.3     Contractor shall, for the protection of Owner, demand from all
                  Vendors and make available to Owner warranties satisfying the
                  requirements of this Section 21. Contractor's liability with
                  respect to such equipment and materials obtained from vendors
                  shall be limited to procuring such warranties and rendering
                  reasonable assistance in enforcement of same.

         21.4     Work not conforming to the Warranties, including substitutions
                  not properly approved and authorized, shall be considered
                  defective. Contractor shall furnish satisfactory evidence as
                  to the kind and quality of materials and equipment.

         21.5     Contractor shall promptly correct Work rejected by Owner for
                  failing to conform to the Warranties, whether observed before
                  or after Substantial Completion and whether or not fabricated,
                  installed or completed. Contractor shall bear all costs of
                  correcting such rejected Work, including additional testing
                  and inspections and compensation for Owner's expenses made
                  necessary thereby.

         21.6     Warranties shall commence on Substantial Completion of such
                  Work except for items completed and accepted on an earlier
                  date in accordance with Section 20.2, and for items completed
                  later with the express written consent of Owner, when such
                  Work is accepted by Owner. Notwithstanding the forgoing
                  provisions of this Section 21, if this Contract is terminated
                  in accordance with Sections 12 or 18, Warranties in respect of
                  all Work performed by Contractor under this Contract

                                                                   Page 65 of 72
<PAGE>   68
                  prior to such termination shall be deemed to commence the
                  effective date of such termination.

         21.7     If at any time within one (1) year after the date on which the
                  Warranties commenced on a Network or Segment or any portion
                  thereof, such Segment, Sub- Segment or portion thereof is
                  found to be not in accordance with the Warranties, Contractor
                  shall correct it promptly after receipt of written Notice from
                  Owner unless Owner has previously given Contractor a written
                  acceptance of such condition. This one (1) year period shall
                  be extended with respect to portions of Work first performed
                  after the applicable Partial Acceptance Date or Final
                  Acceptance Date by the period of time between the applicable
                  Partial Acceptance Date or Final Acceptance Date and the date
                  of completion of such Work. Owner shall give such Notice
                  promptly after discovery of any such condition. Work required
                  under this Section 21.4 shall, unless necessitated by
                  Contractor's failure to perform as required under the Contract
                  or negligence or willful misconduct, be a Cost of the Work.

         21.8     Contractor's Warranties shall apply to any such re-done Work
                  and shall last as to the re-done Work until the latest of: (i)
                  the expiration of the relevant original Warranty Period; (ii)
                  the expiration of any Warranty Period with respect to
                  repurchased equipment; or (iii) one (1) year after completion
                  of any re-done Work.

         21.9     Without in any way derogating Contractor's own representations
                  and warranties (including Warranties) and Contractor's other
                  obligations with respect to all of the Work, Contractor shall
                  obtain from all Subcontractors or Vendors and cause to be
                  extended to Owner prudent representations, warranties,
                  guarantees and obligations with respect to design, materials,
                  workmanship, equipment, tools and supplies furnished by such
                  Subcontractors or Vendors. All representations, warranties,
                  guarantees and obligations of Subcontractors or Vendors shall
                  be: (i) so written as to survive all Owner and Contractor
                  inspections, tests and approvals; and (ii) run directly to and
                  be enforceable by Owner, its successors and assigns.
                  Contractor shall deliver to Owner promptly following execution
                  thereof duly executed copies of all contracts containing such
                  representations, warranties, guarantees and obligations.
                  Contractor shall assign to Owner, at no additional cost, all
                  of Contractor's rights and interest in all extended warranties
                  for periods exceeding the applicable warranty period which
                  were received by Contractor from any of its Subcontractors or
                  Vendors.

         21.10    Upon receipt from Owner of a Notice of failure of any of the
                  Work to satisfy any Subcontractor or Vendor warranty,
                  representation or guarantee obtained by Contractor, Contractor
                  shall be responsible for enforcing or performing any such
                  representation, warranty or guarantee. Owner's rights under
                  this Section 21.1 shall commence at the time such
                  representation, warranty or guarantee is furnished and

                                                                   Page 66 of 72
<PAGE>   69
                  shall continue until the expiration of Contractor's relevant
                  Project Warranty (including extensions for re-warranties).
                  Until such expiration, the cost of any equipment, material,
                  labor (including re-engineering) or shipping shall be for the
                  account of Contractor if such cost is covered by such a
                  Project Warranty and Contractor shall be required to replace
                  or repair defective equipment, material or workmanship
                  furnished by Subcontractors.

         21.11    Commencing on the expiration of each of the respective
                  Warranties, or such later date as is provided with respect to
                  re-done Work, Owner shall be responsible for enforcing all
                  representations, warranties and guarantees from Subcontractors
                  and Vendors, but Contractor shall provide reasonable
                  assistance to Owner in enforcing such representations,
                  warranties and guarantees, when and as reasonably requested by
                  Owner.

         21.12    Except in cases of an emergency requiring immediate curative
                  action by Contractor, within five (5) Days of receipt by
                  Contractor of a Notice from Owner specifying a failure of any
                  of the Work to satisfy Contractor's Warranties, or of any
                  Subcontractor or Vendor representation, warranty or guarantee
                  which Contractor is responsible to enforce, Contractor and
                  Owner shall mutually agree when and how Contractor shall
                  remedy said violation; provided, however, that in case of
                  emergency requiring immediate curative action, Contractor and
                  Owner shall so agree on such remedy immediately upon Notice by
                  Owner of such emergency. If Contractor does not use its best
                  efforts to proceed to complete said remedy within the time
                  agreed to, or should Contractor and Owner fail to reach such
                  an agreement within such five (5) Day period (or immediately,
                  in the case of emergency conditions), Owner, after Notice to
                  Contractor, shall have the right to perform or have performed
                  by third parties the necessary remedy and the costs thereof
                  shall be borne by Contractor.

         21.13    The obligations contained in this Section 21 WARRANTY, govern
                  and supersede any other terms in this Contract which address
                  warranties, guarantees, or the quality of the Work and are
                  Contractor's sole warranty and guarantee obligations and
                  Owner's exclusive remedies with respect thereto. Contractor
                  shall have no warranty obligation or liability for defects in
                  the Work unless Owner demonstrates the warranty claim is not
                  attributable to Contractor's reliance upon or use of data,
                  design criteria, drawings, specifications or other information
                  furnished by Owner.

         21.14    Contractor makes no representations, covenants, warranties, or
                  guarantees, express or implied, other than those expressly set
                  forth herein. The parties' rights, liabilities,
                  responsibilities and remedies with respect to the Work shall
                  be exclusively those expressly set forth in this Contract.

                                                                   Page 67 of 72
<PAGE>   70
22       MISCELLANEOUS PROVISIONS

         22.1     Governing Law and Venue. THE PARTIES AGREE THIS CONTRACT SHALL
                  BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE
                  STATE OF COLORADO. THE PARTIES FURTHER AGREE THAT ANY
                  LITIGATION ARISING OUT OF THIS CONTRACT SHALL BE TRIED IN
                  DENVER COUNTY, COLORADO, OR THE UNITED STATES DISTRICT COURT
                  FOR THE DISTRICT OF COLORADO AND NOT ELSEWHERE.

         22.2     Successors and Assigns. This Contract shall be binding upon
                  and inure to the benefit of Owner and Contractor and their
                  successors, assigns, and legal representatives. Without the
                  prior consent of Contractor, Owner may, upon reasonable
                  advance written notice, assign all or part of its right,
                  title, and interest in this Contract. Contractor shall not
                  assign this Contract or any right to receive payment hereunder
                  without the prior written consent of Owner. Contractor may not
                  delegate any of its duties hereunder except as expressly
                  otherwise permitted herein. Contractor's assignment or
                  delegation of any of its Work hereunder, whether permitted
                  hereunder or not, shall relieve Contractor of its
                  responsibility for the Work assigned or delegated.

         22.3     Third Party Beneficiary. It is specifically agreed between the
                  parties executing this Contract that it is not intended by any
                  of the provisions of any part of this Contract to create in
                  the public or any member thereof a third party beneficiary
                  hereunder, or to authorize anyone not a party to this Contract
                  to maintain a suit for personal injuries or property damage
                  pursuant to the terms or provisions of this Contract. The
                  duties, obligations and responsibilities of the parties to
                  this Contract with respect to third parties shall remain as
                  imposed by law.

         22.4     Designation of Representatives. Owner and Contractor shall
                  each designate an individual or individuals that shall be
                  authorized to make decisions and bind the parties on matters
                  relating to this Contract. These representatives shall live in
                  the general vicinity of the Work. Such designation shall be in
                  writing and may be changed by a subsequent writing. The
                  parties may also designate technical representatives who shall
                  be authorized to investigate and report on matters relating to
                  the Project and negotiate on behalf of each of the parties but
                  who do not have authority to bind Owner.

         22.5     Entire Agreement: Amendments. This Contract, including its
                  exhibits, appendixes and attachments contains the entire
                  understanding of the parties with respect to this subject
                  matter. This Contract supersedes all prior agreements and
                  understandings between the parties with respect to its subject
                  matter. This

                                                                   Page 68 of 72
<PAGE>   71
                  Contract may be amended only by a written instrument duly
                  executed by the parties or their respective successors or
                  assigns.

         22.6     Independent Contractors. Contractor is an independent
                  contractor and nothing lien shall be construed as constituting
                  any relationship with Owner other than that of owner and
                  independent contractor, nor shall it be construed as creating
                  any relationship whatsoever between Owner and Contractor's
                  employees. Neither Contractor, nor any of its employees, are
                  or shall be deemed employees of Owner. Contractor has sole
                  liability and responsibility as a principal for its agents,
                  Subcontractors, Vendors and all others it hires to perform or
                  assist in performing the Work.

         22.7     Liens and Claims. If Contractor shall fail promptly to
                  discharge any nothing contained herein or claim upon the
                  Project, or upon any materials, equipment or structures
                  encompassed therein, or upon the premises upon which they are
                  located, Owner shall promptly notify Contractor in writing and
                  Contractor shall then satisfy or defend any such liens or
                  Claims. If Contractor either does not promptly satisfy such
                  liens or Claims or does not give Owner reasons in writing
                  satisfactory to Owner for not causing the release of such lien
                  or paying such Claims, Owner shall have the right, at its
                  option, after written Notice to Contractor, to cause the
                  release, pay or settle such lien or Claims by agreement and
                  Contractor shall within five (5) Days of request by Owner,
                  reimburse Owner for all costs incurred by Owner to discharge
                  such lien or Claims including administrative costs, attorneys'
                  fees and other expenses. Contractor shall have the right to
                  contest any such lien provided it first provides to Owner a
                  bond or other assurances of payment reasonably satisfactory to
                  Owner, in the amount of such lien or Claim in form and
                  substance satisfactory to Owner.

         22.8     Notice and Communications. Any Notice pursuant to the terms
                  and conditions of this Contract shall be in writing and: (i)
                  delivered personally; or (ii) sent by certified mail, return
                  receipt requested; or (iii) sent by a recognized overnight
                  mail or courier service, with delivery receipt requested, to
                  the following addresses (or to such other address as may from
                  time to time be specified in writing by Contractor or Owner):

                  If to Contractor:

                           National Network Technologies, LLC.
                           26 Broadway, Suite 400
                           New York, NY 10004
                           Attn:    Daniel Corbett, VP of Engineering
                           Ph:      (212) 837-7700
                           Fax:     (212) 837-7917

                                                                   Page 69 of 72
<PAGE>   72
                  If to Owner:

                           Raouf Abdel
                           Level 3 Communications, LLC
                           14023 Denver West Parkway
                           Golden, Colorado 80401
                           Ph:      (303) 215-8554
                           Fax:     (303) 218-8388

                           with a copy to:

                           Level 3 Communications, LLC
                           1450 Infinite Drive
                           Louisville, Colorado 80027
                           Attention:  General Counsel
                           Fax: (303) 926-3467

                  Notices shall be effective when received by the party to whom
                  addressed. Any technical or other communications pertaining to
                  the Work shall be between designated representatives appointed
                  by the parties. Each party shall notify the other in writing
                  of the name of such representatives. Contractor's
                  representatives shall be satisfactory to Owner, have knowledge
                  of the Work and be available at all reasonable times for
                  consultation. Each party's representative shall be authorized
                  to act on behalf of such party in matters concerning the Work.

         22.9     Ownership of Documents. All design and construction Documents
                  and Specifications shall become Owner's property upon
                  preparation and Contractor shall retain and furnish Owner with
                  copies of all such design and construction Documents and
                  Specifications as they are completed. Notwithstanding anything
                  to the foregoing, Owner shall not receive title to proprietary
                  Contractor or third party property. All Documents,
                  Specifications and information prepared or obtained by
                  Contractor in connection with the performance of its
                  obligations under this Contract such as, by way of
                  illustration and not limitation, studies, technical and other
                  reports, shop drawings, record drawings and the like, shall
                  also be retained and become the property of Owner upon
                  preparation or receipt. Copies of all such Documents,
                  Specifications and information shall be furnished, in a form
                  and manner acceptable to Owner, upon receipt or completion
                  thereof by Contractor.

         22.10    Severability. The invalidity or unenforceability of any
                  portion or provision of this Contract shall not affect the
                  validity or enforceability of any other portion or provision.
                  Any invalid or unenforceable portion or provision shall be
                  deemed severed from this Contract and the balance of this
                  Contract shall be construed and

                                                                   Page 70 of 72
<PAGE>   73
                  enforced as if this Contract did not contain such invalid or
                  unenforceable portion or provision.

         22.11    Survival. Certain obligations of Contractor shall survive the
                  termination of this Contract including the obligations of
                  Contractor under Sections 16, 19, and 21 and terms which by
                  their very nature extend beyond termination or completion of
                  the job.

         22.12    Waiver. Either party's waiver of any breach or failure to
                  enforce any of the terms, covenants, conditions or other
                  provisions of this Contract at any time shall not in any way
                  affect, limit, modify or waive that party's right thereafter
                  to enforce or compel strict compliance with every term,
                  covenant, condition or other provision, any course of dealing
                  or custom of the trade notwithstanding.

         22.13    Headings. The headings contained herein are included solely
                  for the convenience of the parties.

         22.14    Confidentiality. If Owner and Contractor have not done so
                  prior to execution of this Contract, each agrees to execute a
                  Confidentiality Agreement contemporaneously with the execution
                  of this Contract in a form substantially similar to the form
                  attached hereto as Appendix "C". The provisions of the
                  Confidentiality Agreement shall survive the expiration or
                  termination of this Contract. Contractor shall require
                  Subcontractors and Vendors to execute and abide by similar
                  confidentiality requirements.

         22.15    Publicity. Neither party shall publish or use any advertising,
                  sales, promotions, press releases or other publicity matters
                  which use the other party's logo, trademarks or service marks
                  without the prior written approval of the other party. Neither
                  party is licensed hereunder to conduct business under any
                  logo, trademark, service mark, or trade name (or any
                  derivative thereof) of the other.

         22.16    Solicitation of Employment. Neither party shall, during the
                  term of this Agreement or for a period of one hundred eighty
                  (180) days thereafter, directly or indirectly for itself or on
                  behalf of, or in conjunction with, any other person,
                  partnership, corporation, business or organization, solicit
                  employment of an employee of the other with whom that party or
                  its personnel have had contact during the course of the
                  Project under this Contract, unless that party has obtained
                  the written consent of the other to such solicitation.

                                                                   Page 71 of 72
<PAGE>   74
IN WITNESS WHEREOF, the parties have caused this Contract to be duly executed
and delivered as of the date and the year above written.

                                             LEVEL 3 COMMUNICATIONS, LLC

                                             By: _______________________________

                                             Title: ____________________________

Attest: ________________________________________________

                                             NATIONAL NETWORK TECHNOLOGIES, LLC.

                                             By: _______________________________

                                             Title: ____________________________

Attest: ________________________________________________

                                                                   Page 72 of 72
<PAGE>   75
                                  APPENDIX "A"

                           DESCRIPTION OF THE PROJECT

Upon Issuance, Notices to Proceed shall be sequentially numbered under the
appropriate city.

A.1      New York, NY

A.2      Boston, MA

A.3      Philadelphia, PA

A.4      Northern New Jersey

A.5      Stamford, CT

<PAGE>   76
                                  APPENDIX "C"

                            NON-DISCLOSURE AGREEMENT

                  This Agreement is made and entered into by and between
NATIONAL NETWORK TECHNOLOGIES, LLC, a Delaware limited liability company, and
its affiliates (collectively "NNT"), and LEVEL 3 COMMUNICATIONS, LLC a Delaware
limited liability company, and its affiliates (collectively "LEVEL 3") (each
being a "party" or collective "parties").

1. DISCLOSURE. The parties intend to engage in discussions concerning a
potential business relationship (the "Proposed Relationship"). In connection
therewith, Level 3 and NNT may disclose to each other technical, financial
and/or other information, material, or data which is written, oral or in any
other form, electronic or otherwise (collectively "Data") which is considered
confidential and proprietary.

2. CONFIDENTIAL DATA. "Confidential Data" means (a) any Data disclosed by or on
behalf of a party ("disclosing party") to the other party ("receiving party"),
including, without limitation, (i) any materials, trade secrets, know-how,
formulas, processes, algorithms, ideas, strategies, inventions, data, network
configurations, system architecture, designs, flow charts, drawings, proprietary
information, business and marketing plans, financial and operational
information, and all other non-public information, material or data relating to
the current and/or future business and operations of the disclosing party, and
(ii) any information, material or data provided by third party vendors of the
disclosing party; and (b) any analyses, compilations, studies, summaries,
extracts or other documentation prepared by the receiving party based on the
Data disclosed by the disclosing party.

3. PUBLIC DATA. Notwithstanding any other provision of this Agreement, Data
shall not be, or shall cease to be, Confidential Data hereunder: (a) if such
Data is known to the receiving party prior to disclosure thereof by the
disclosing party; (b) after such Data is published or becomes available to
others, without restriction and without breach of this Agreement by the
receiving party; (c) after such Data becomes available to the receiving party
from others having no obligation to hold such Data in confidence; or (d) if such
Data is developed by the receiving party independently of any disclosure of such
Data by the disclosing party.

4. NON-DISCLOSURE OBLIGATION. Unless otherwise agreed to in writing by the
disclosing party, the receiving party agrees (a) not to disclose the
Confidential Data; (b) use the same degree of care and diligence to protect such
Confidential Data from disclosure to others as such party employs or should
reasonably employ to so protect its own information of like importance (but in
no event less than reasonable care); and (c) not to reproduce or copy the
Confidential Data, in whole or in part, except as necessary for the evaluation
or conduct of the Proposed Relationship. Notwithstanding the foregoing, the
receiving party may disclose the Confidential Data, to such of the receiving
party's consultants, agents and affiliates (collectively "receiving party
representative") which the receiving party reasonably and in good faith believes
should be
<PAGE>   77
involved in the evaluation or performance of the Proposed Relationship, provided
such receiving party representative is informed of this Agreement and agrees to
be bound by the terms hereof, and the receiving party uses best efforts to cause
the receiving party representative to observe the terms of this Agreement. The
receiving party agrees that a breach of this Agreement by a receiving party
representative shall constitute a breach by the receiving party. In the event
that the receiving party is required by applicable law, rule, regulation or
lawful order or ruling of any court, government agency or regulatory commission
to disclose any Confidential Data, the receiving party agrees that it will
provide the disclosing party with prompt notice of such request(s) to enable the
disclosing party to seek an appropriate protective order or to take steps to
protect the confidentiality of such Confidential Data.

5. NO ADDITIONAL RIGHTS. The receiving party shall not have any rights or
obligations respecting the Confidential Data other than those specifically set
forth in this Agreement. Without limiting the generality of any other provision
of this Agreement: (a) no license is hereby or otherwise granted, directly or
indirectly, under any patent, copyright or other proprietary right of the
disclosing party or its third party vendors; and (b) neither party shall be
obligated to disclose Data to the other party or to enter into any further
agreements relating to the Proposed Relationship or Data. A party may terminate
discussions regarding the Proposed Relationship at any time. The receiving party
shall, upon written request of the disclosing party, return to the disclosing
party all Confidential Data, including all copies thereof, disclosed hereunder.
The receiving party's obligations under this Agreement respecting the
Confidential Data shall survive termination of said discussions.

6. INJUNCTIVE RELIEF. Both parties acknowledge and agree that the disclosing
party and/or its third party vendors (as the case may be) own all rights, title
and interest in the Confidential Data. Both parties further acknowledge and
agree that the unauthorized disclosure of the Confidential Data will cause
irreparable harm to the disclosing party. As a result of the unique nature of
the Confidential Data, in addition to all other remedies available, the
disclosing party shall be entitled to seek injunctive and other extraordinary
relief in a court of competent jurisdiction in order to enforce the receiving
party's obligations hereunder.

7. OTHER PROVISIONS. The parties further agree that: (a) this Agreement shall be
governed by the laws of the State of Nebraska; (b) this Agreement sets forth the
entire agreement and understanding between the parties with respect to the
subject matter hereof, and none of the terms of this Agreement may be amended or
modified except by a written instrument signed by both parties; (c) a party may
waive any rights under this Agreement only by written waiver duly signed by such
party, and no failure to exercise or delay in exercising a right under this
Agreement shall constitute a waiver of such right; (d) this Agreement shall
inure only to the benefit of the parties hereto, and the rights and obligations
of each party under this Agreement may not be assigned or delegated without the
consent of the other party; (e) no provision of this Agreement shall affect,
limit or restrict either party's right to engage in any business in any place
and at any time, whatsoever, provided the receiving party does not disclose the
Confidential Data in violation of this Agreement; (f) each party agrees not to
advertise, or otherwise make known to others, any
<PAGE>   78
information regarding this Agreement or the Proposed Relationship except as may
be required by law; (g) neither party makes any representations or warranties as
to the accuracy or completeness of any Data disclosed hereunder; (h) the
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement;
(i) all notices under this Agreement must be in writing and shall be deemed to
have been delivered to and received by a party, and will otherwise become
effective, on the date of actual delivery thereof (by personal delivery, express
delivery service or certified mail) to the Notice Address of such party set
forth below; (j) this Agreement may be executed in counterparts; and (k) this
Agreement is dated for all reference purposes October 14, 1998.

LEVEL 3 COMMUNICATIONS, LLC                   NATIONAL NETWORK
("LEVEL 3")                                   TECHNOLOGIES, LLC ("NNT")

By: _______________________________           By: ______________________________
Name: _____________________________           Name: ____________________________

Notice Address:                               Notice Address:

         3555 Farnam Street                            26 Broadway
         Suite 200                                     Suite 400
         Omaha, Nebraska  68131                        New York, New York  10005
         Attn:  General Counsel                        Attn:  Larry Lundy
<PAGE>   79
                                  APPENDIX "D"

                              AWARD FEE COMPUTATION

         *

Award Fee Scoring Table:

                   Rating                          Possible Score
                   Outstanding                            *
                   Very Good                              *
                   Good                                   *
                   Average                                *
                   Needs Improvement                      *

<TABLE>
<CAPTION>
                                                                                                          Weighted
                               Instruction                              Score           Weight              Score
<S>                                                                     <C>             <C>               <C>
A     Determine score in area of Program Management
      and multiply by weight                                                             *
B     Determine score in area of Work on the basis of
      Safety and multiply by weight                                                      *
C     Determine scare in area of Quality and multiply by
      weight                                                                             *
D     Determine score in area of Cost and multiply by
      weight                                                                             *
E     Determine score in area of Schedule and multiply
      by weight                                                                          *
F     Total the weighted scores (maximum      *     )                                    *
</TABLE>

  * Portions of this exhibit marked with a "*" have been filed confidentially
with the Commission pursuant to a confidential treatment request filed by
Registrant.
<PAGE>   80
Step 3.  Determine Award Fee due for month.

<TABLE>
<S>                                           <C>                                <C>
                      1                                  2                                  3
             *                                *                                    *
</TABLE>

  * Portions of this exhibit marked with a "*" have been filed confidentially
with the Commission pursuant to a confidential treatment request filed by
Registrant.
<PAGE>   81
                                  APPENDIX "E"

                               PROGRAM MANAGEMENT

Program Management is the timely, efficient and systematic management and
execution of the design, engineering, procurement and construction for the
Project. Owner's expectations for a successful Program Management effort for the
Project will be directly linked to: 1) timely and accurate reporting, estimating
and scheduling; 2) thorough and detailed execution of the permitting and design
process; 3) proactive and aggressive cost and schedule reduction techniques; 4)
high level of accuracy in development of allocation methodologies for Allocated
Costs when compared to actual costs; 5) innovative and efficient management of
material procurement and control; 6) sound and safe construction techniques; 7)
efficient reporting and subcontract administration; and 8) cooperative and
efficient communication with the Owner and Oversight Engineer.

Program Management scoring is as follows:

Outstanding:

Consistently far exceeds Owner's expectations for the criteria.

Very Good:

Generally exceeds Owner's expectations for the criteria.

Good:

Meets Owner's expectations for the criteria.

Average:

Does not regularly meet or exceed Owner's expectations for the criteria.

Needs Improvement:

Typically below Owner's expectations for the criteria.
<PAGE>   82
                                  APPENDIX "F"
                                     SAFETY

Safety of Persons, property and equipment is a primary concern in executing the
Project. All Work shall be performed during hours acceptable to Owner,
Governmental Persons and private land owners and in a safe and workmanlike
manner. In addition to complying with Contractor's internal safety policies, the
latest requirements of the Occupational Safety and Health Act ("OSHA") of 1970,
the Construction Safety Act of 1969, and all standards and regulations which
have been or shall be promulgated Governmental Persons shall be followed in
every case. Contractor shall operate and maintain all equipment in a manner
which ensures the safety of Persons, surrounding property and the equipment
itself. Contractor's safety rating shall be based on the criteria specified
below, which shall apply to all Work, including Work performed by
Subcontractors, Vendors or others. However, the rates for "recordable
occupational injuries or illnesses" shall apply only to Work performed by
contractor with its own forces.

Outstanding

-    Always maintains an exemplary level of safety with zero tolerance for
     unsafe acts.

-    Continually takes steps to raise employee awareness of safety through
     extensive hazard analysis and training; always complies with Governmental
     rules; and employees, subcontractors, vendors and agents awareness of
     maintaining zero (0) safety related incidents is extremely high.

-    Contractor experiences a rate of less than 1.6 for OSHA "recordable
     occupational injuries or illnesses" in its performance of the Project.

Very Good:

-    Well above average in nearly all established parameters for safety with
     zero tolerance for unsafe acts.

-    Periodically takes steps to raise employee awareness of safety through
     hazard analysis and training; almost always complies with Governmental
     Rules; and employees, subcontractors, vendors and agents awareness of
     maintaining zero (0) safety related incidents is well above average.

-    Contractor experiences a rate of 1.6 and greater to less than 2.0 for OSHA
     "recordable occupational injuries or illnesses" in its performance of the
     Project.

Good:

-    Above average in a majority of established parameters for safety with zero
     tolerance for unsafe acts.

-    Usually takes steps to raise employee awareness of safety through hazard
     analysis and training; typically complies with Governmental rules; and
     employees, subcontractors, vendors and agents awareness of maintaining zero
     (0) safety related incidents is above average.
<PAGE>   83
-    Contractor experiences a rate of 2.0 and greater to less than 2.5 for OSHA
     "recordable occupational injuries or illnesses" in its performance of the
     Project.

Average:

-    Average performance across the established parameters for safety, and/or
     exhibits some tolerance for unsafe acts.

-    Periodically (but not frequently) takes steps to raise employee awareness
     of safety through hazard analysis and training; regularly complies with
     Governmental rules; and employees, subcontractors, vendors and agents
     awareness of maintaining zero (0) safety related incidents is average.

-    Contractor experiences a rate of 2.5 and greater to less than 3.0 for OSHA
     "recordable occupational injuries or illnesses" in its performance of the
     Project.

Needs Improvement:

-    Well below average performance across the established parameters for safety
     and or exhibits tolerance for unsafe acts.

-    Infrequently takes steps to raise employee awareness of safety through
     hazard analysis and training; is lax in complying with Governmental rules:
     and employees, subcontractors, vendors and agents awareness of maintaining
     zero (0) safety related incidents is extremely low.

-    Requires Program management commitment to correct.

-    Contractor experiences a rate of 3.0 and greater for OSHA "recordable
     occupational injuries or illnesses" in its performance of the Project.
<PAGE>   84
                                  APPENDIX "G"
                                     QUALITY

Quality is essential to ensuring capital investment Yields lasting and durable
assets. All installation work shall be performed in accordance with the
Specifications of the Owner, Governmental Persons, private land owners and
Contractor's internal quality policies. Achieving high quality will require, at
a minimum, that: 1) minimal re-engineering be done; 2) specifications are
adhered to; 3) ROW restoration requires few return trips; 4) damage to private
property is minimized; 5) damage to public property including another utilities
is minimized; 6) Facilities are turned over with short punch lists; 7) outside
plant inventory records are well maintained and accurate; and 8) as-built
drawings are highly accurate. Additionally, effective Program Management will
require that: the website information provided by Contractor is accurate and can
be used for daily progress monitoring, minimizing permit application
re-submittals and governmental agency impacts / issues. Contractor's quality
rating shall be based on the following criteria:

Outstanding:

Always maintains an exemplary level of quality with all expectations exceeded.
For example, engineering drawings are error free; construction is performed in
full compliance with permit requirements and specifications.

Very Good:

Well above average in nearly all established parameters for quality with all
expectations met. For example, permits are nearly always applied for correctly
and re-submittals, if any, do not cause delays or extra expenses; ROW
restoration is excellent with very few return trips required to do additional
cleanup.

Good:

Above average in a majority of established parameters for quality with most
expectations met. For example, facilities are completed with short punch-lists
and minimal delays are incurred; a few unnecessary specification deviations are
made, but are corrected promptly.

Average:
<PAGE>   85
                                  APPENDIX "H"

                                      COST

Contractor will be substantially evaluated based on the total cost of the
Project (excluding Award Fee but including G&A Fee and all Owner provided
materials). Prior to actual costs being available, Owner will evaluate
Contractor's performance based on budget projections (including the likelihood
of achieving budget projections). As actual costs become available, they will be
factored into the evaluation.

The Owner's expectations for the per mile cost of the Scope of the Work are
specified below. They are based on comparable work as of the Effective Date. In
the event actual costs are significantly different from those below through no
fault of Contractor, Owner may elect to change the per mile costs stated below
in its sole discretion.

Owner will use the costs specified below as general guidelines but will also
consider other factors as part of the subjective evaluation. Factors such as a
change in conditions, directions of Owner which impact the cost and the
effectiveness of Contractor's cost management program will be considered.

Owner's estimated costs and the respective ratings as shown below for each
Network will be determined within thirty (30) Days after the respective Contract
Budget is approved.

<TABLE>
<CAPTION>
         Rating                             Cost
         ------                             ----
<S>                                 <C>
         Outstanding                <$                per mile
         Very Good                  $________________ to $______________ per mile
         Good                       $________________ to $______________ per mile
         Average                    $________________ to $______________ per mile

         Needs Improvement          >$                per mile

         Outstanding                <$                per building
         Very Good                  $________________ to $______________ per building
         Good                       $________________ to $______________ per building
         Average                    $________________ to $______________ per building
         Needs Improvement          >$_______________ per building
</TABLE>

When applying these targets during each month, Owner will take into account the
Segments that have been completed and the performance targets will be applied
accordingly.
<PAGE>   86
                                  APPENDIX "I"
                                    SCHEDULE

Contractor will be evaluated based on completion of route miles and buildings
and completion of the overall Project.

Owner will use the performance targets below as general guidelines but will also
consider other factors such as a change in conditions, directions of Owner which
impact the schedule and the effectiveness of Contractor's schedule management
program.

The performance levels for route miles and buildings completion are:

<TABLE>
<CAPTION>
                                            Percentage of Route Miles Completed
         Rating                [date]       [date]        [date]        [date]        [date]       [date]
         ------
<S>                            <C>          <C>           <C>           <C>           <C>          <C>
         Outstanding           20-25%       50-60%        95-100%       100%          x            x
         Very Good             15-20%       40-50%        80-95%        95-100%       x            x
         Good                  10-15%       30-40%        70-80%        90-95%        100%         x
         Average               5-10%        25-30%        60-70%        80-90%        95-100%      100%
         Needs                 0-5%         <25%          <60%          <80%          <95%         <100%
         Improvement
</TABLE>

<TABLE>
<CAPTION>
                                            Percentage of Route Buildings Completed
         Rating                [date]       [date]        (date]        (date]        (date]       [date]
         ------
<S>                            <C>          <C>           <C>           <C>           <C>          <C>
         Outstanding           20-25%       50-60%        95-100%       100%          x            x
         Very Good             15-20%       40-50%        80-95%        95-100%       x            x
         Good                  10-15%       30-40%        70-80%        90-95%        100%         x
         Average               5-10%        25-30%        60-70%        80-90%        95-100%      100%
         Needs                 0-5%         <25%          <60%          <80%          <95%         <100%
         Improvement
</TABLE>

The Owner will consider changes to the performance levels if there is a
significant variation from the initial planned approach.
<PAGE>   87

                APPENDIX "J" RESPONSES TIMES FOR OWNER'S APPROVAL

The Owner will pass to the Contractor as much information Owner can provide at
the time of the execution of the contract, items 2.1.1 through 2.1.4 as
specified in section 2 PROJECT within five (5) days. If the Contractor deems
that the information the Owner supplied is insufficient for items 2.1.1 through
2.1.4 as specified in section 2 PROJECT. The Contractor will notify the Owner
within five (5) business days of the impact that may affect items 2.1.1 through
2.1.4 in section 2 PROJECT.

<TABLE>
<CAPTION>
        Contractors' Action                                 Owners Response
-------------------------------------------------------------------------------
<S>                                                        <C>
Implementation Plan                                        15 business days
-------------------------------------------------------------------------------
Drawings and Specifications                                10 business days
-------------------------------------------------------------------------------
Re-Submittals                                              10 business days
-------------------------------------------------------------------------------
Pre-qualification of Subcontractors/Vendors                10 business days
-------------------------------------------------------------------------------
Subcontractor/Vendor Award Letter                          5 business days
-------------------------------------------------------------------------------
Subcontractor/Vendor Notice to Proceed                     5 business days
-------------------------------------------------------------------------------
Material Purchase Orders                                   5 business days
-------------------------------------------------------------------------------
</TABLE>

The Contractor shall submit one (1) original and two *(2) copies of design
Drawings or Documents for the review and approval by the Owner. These design
Drawings or Documents shall be free of all extraneous pencil, ink crayon of
other markings and are to be of a quality which will produce clear and legible
copies. Within 10 business days of receipt by Owner, Owner will transmit one (1)
set of Drawings or Documents to the Contractor with corrections and changes
noted thereon or indicating approval.

Where such Drawings or Documents have been indicated as "approved" or "approved
as noted" no resubmission is required. Where such Drawings or Documents have
been indicated as "approved as noted-resubmit" or disapproved" the Contractor
shall make corrections and changes indicated and resubmit (1) original and two
(2) copies of design Drawings or Documents for the review and approval by the
Owner. Within 10 working days of receipt by Owner, Owner will transmit one (1)
set of Drawings or Documents to the Contractor with corrections and changes
noted thereon or indicating approval.

No work shall commence until the Contractor has received "approval" or "approved
as noted" Drawings or Documents.
<PAGE>   88
No changes or corrections other than the changes and corrections noted by the
Owner shall be made to any Drawings or Documents except by resubmission of such
Drawings or Documents with the revisions appropriately noted.

The Owner shall notify the Contractor within five (5) business days by a copy of
the Award letter for subcontractor services. The Owner shall notify the
Contractor within five (*5) business days with a copy of the Notice to proceed
including the approved CPM construction schedule for subcontractor services.

The Owner shall notify the Contractor within five (5) business days by
submitting copies of all purchase orders for permanent materials as specified in
section 8. The purchase orders shall identify description of item, quantities,
project identification and delivery date with delivery location.

If Contractor falls fifteen (15) days behind on any critical path activity shown
on the approved Construction Schedule, the Owner shall review and comment within
five (5) business days the Contractor's Recovery Schedule as specified in
section 9.1.12.
<PAGE>   89
                                   APPENDIX K

                        NATIONAL NETWORK TECHNOLOGIES LLC

                                  TRAVEL POLICY

General: Employees shall be reimbursed for reasonable travel and subsistence
expenses incurred while traveling on company business, provided that such travel
has been authorized in advance by the employee's supervisor. The most
cost-effective means of travel and subsistence shall be used in all
circumstances. Reimbursements shall be made only for expenses incurred in
accordance with the following guidelines.

Airline Tickets: All air travel shall be by Economy Class. The lowest-cost
Economy Fare for whichever specific destination at the approximate time required
by the employee shall be purchased, regardless of possible frequent flyer
mileage considerations. If an employee chooses to upgrade to Business Class or
First Class, only the lowest-cost Economy Class fare available for that route
shall be reimbursed. Airline tickets shall be obtained from travel agents
approved by the company, except for emergency travel, in which case the nature
of the emergency shall be described in a memo by the employee attached to his
expense statement.

Local Transportation: Employees shall use public transportation wherever
practical. Rental cars may be used only if public transportation is not
available, or if the use of public transportation would substantially increase
the amount of time required to travel between local destinations. If an
employee's personal automobile is used for business travel, the company shall
reimburse the employee at the rate of 32.5 cents per mile. That mileage rate
reimbursement is intended to cover all costs related to the automobile including
gas, oil, insurance, depreciation, and repairs, both routine and emergency,
including collision and comprehensive damage. If an employee uses his personal
automobile for business travel, he shall carry adequate automobile liability,
________ and comprehensive insurance coverage, and the company shall not
reimburse any costs related to the automobile other than the 32.5 cents per
mile, plus parking and tolls.

Hotel: Hotels shall be utilized which are of moderate cost (e.g. Hampton Inns),
based on the locality. Laundry charges are not reimbursable unless the employee
is out of town for six consecutive nights. Pay-TV and Movie charges will not be
reimbursed.

Meals: The cost of meals will be reimbursed if the employee is required to stay
out of town overnight. The cost of meals shall be reasonable based on the
locality, and in general should not exceed $35 per day. The cost of alcoholic
beverages is not reimbursable. If an employee pays for meals for another
employee, the employee who incurs the cost shall show the name(s) of the other
employee(s) on his expense report.
<PAGE>   90
Receipts: Original receipts (not copies) shall be attached to the employee's
expense report for all expenses over $25. Credit cards must be used for air
fare, hotel, and rental cars, and should also be used for all other expenses
wherever possible.<PAGE>   1
                                                                   EXHIBIT 10.11

                             AMERIGROUP CORPORATION
                           2000 EQUITY INCENTIVE PLAN

1.       PURPOSE OF PLAN

         The name of this plan is the AMERIGROUP Corporation 2000 Equity
Incentive Plan (the "Plan"). The purpose of the Plan is to provide additional
incentive to those officers, employees, and nonemployee directors of and
consultants and advisors to the Company and its Parents, Subsidiaries and
Affiliates (as hereinafter defined) whose contributions are essential to the
growth and success of the Company's business, in order to strengthen the
commitment of such persons to the Company and its Parents, Subsidiaries and
Affiliates, motivate such persons to faithfully and diligently perform their
responsibilities and attract and retain competent and dedicated persons whose
efforts will result in the long-term growth and profitability of the Company and
its Parents, Subsidiaries and Affiliates. To accomplish such purposes, the Plan
provides that the Company may grant Incentive Stock Options, Nonqualified Stock
Options, Restricted Stock, Phantom Stock, Stock Bonuses and Other Awards. From
and after the consummation of a Public Offering, the Board may determine that
the Plan is intended, to the extent applicable, to satisfy the requirements of
section 162(m) of the Code and shall be interpreted in a manner consistent with
the requirements thereof.

2.       DEFINITIONS

         For purposes of the Plan, the following terms shall be defined as set
forth below:

         a. "Administrator" means the Board, or if and to the extent the Board
does not administer the Plan, the Committee, in accordance with Section 3
hereof.

         b. "Affiliate" means any corporation 50% or more of the voting power of
the outstanding voting securities of which is owned by the Company, its Parents
or its Subsidiaries, or by any other Affiliate.

         c. "Award" means an award of Incentive Stock Options, Nonqualified
Stock Options, Restricted Stock, Phantom Stock, Stock Bonus or Other Awards
under the Plan.

         d. "Award Agreement" means, with respect to any Award, the written
agreement between the Company and the Participant setting forth the terms and
conditions of the Award.

         e. "Board" means the Board of Directors of the Company.

         f. "Cause" means, unless a Participant is a party to a written
employment agreement with the Company, Parent, Subsidiary or Affiliate which
contains a definition of "cause," "termination for cause," or any other similar
term or phrase, in which case "Cause" shall have the meaning set forth in such
agreement, conduct involving one or more of the following: (i) the substantial
and continuing gross and willful failure of the Participant to render services
to the Company or any Parent, Subsidiary or Affiliate in accordance with the
Participant's obligations

1
<PAGE>   2
and position with the Company, Parent, Subsidiary or Affiliate, which failure
materially and adversely affects or could materially and adversely affect the
business, prospects, financial condition, operations, property or affairs of the
Company or any Parent, Subsidiary or Affiliate, after 30 day's notice from the
President of the Company or any Parent, Subsidiary or Affiliate, such notice
setting forth in reasonable detail the nature of such failure, and in the event
the Participant fails to cure such breach or failure within 30 days of notice
from the Company or any Parent, Subsidiary or Affiliate, if such breach or
failure is capable of cure; (ii) dishonesty, gross negligence, breach of
fiduciary duty; (iii) the commission by the Participant of an act of fraud or
embezzlement, as found by a court of competent jurisdiction, which results in
material loss, damage or injury to the Company or any Parent, Subsidiary or
Affiliate, whether directly or indirectly, or the commission by the Participant
of any other action with the intent to injure materially the Company or any
Parent, Subsidiary or Affiliate which could, in the reasonable opinion of the
President of the Company, result in material harm to the Company or any Parent,
Subsidiary or Affiliate; (iv) the conviction of the Participant of a felony,
either in connection with the performance of his or her obligations to the
Company, Parent, Subsidiary or Affiliate or which shall materially adversely
affect the Participant's ability to perform his obligations to the Company,
Parent, Subsidiary or Affiliate; or (v) material breach of the terms of an
agreement with the Company or any Parent, Subsidiary or Affiliate, provided that
the Company or any Parent, Subsidiary or Affiliate provides the Participant with
adequate notice of such breach and the Participant fails to cure such breach, if
the breach is reasonably curable, within thirty (30) days after receipt of such
notice.

         g. "Change in Capitalization" means any increase, reduction, or change
or exchange of Shares for a different number or kind of shares or other
securities or property by reason of a reclassification, recapitalization,
merger, consolidation, reorganization, issuance of warrants or rights, stock
dividend, stock split or reverse stock split, combination or exchange of shares,
repurchase of shares, change in corporate structure or otherwise; or any other
corporate action, such as declaration of a special dividend, that affects the
capitalization of the Company.

         h. "Change in Control" means the first to occur of any one of the
events set forth in the following paragraphs:

                  (i) any Person is or becomes the "Beneficial Owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company (not including in the securities Beneficially Owned by
such Person any securities acquired directly from the Company) representing 25%
or more of the Company's then outstanding securities, excluding any Person who
becomes such a Beneficial Owner in connection with a transaction described in
clause (A) of paragraph (iii);

                  (ii) the following individuals cease for any reason to
constitute a majority of the number of directors then serving: individuals who,
on the effective date of a Public Offering, constitute the Board of Directors
and any new director (other than a director whose initial assumption of office
is in connection with an actual or threatened election contest, including but
not limited to a consent solicitation, relating to the election of directors of
the Company) whose appointment or election by the Board of Directors or
nomination for election by the Company's

2
<PAGE>   3
stockholders was approved or recommended by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors on the Effective
Date or whose appointment, election or nomination for election was previously so
approved or recommended;

                  (iii) there is consummated a merger or consolidation of the
Company with any other corporation other than (A) a merger or consolidation
which results in the directors of the Company immediately prior to such merger
or consolidation continuing to constitute at least a majority of the board of
directors of the Company, the surviving entity or any parent thereof, or (B) a
merger or consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (not including in the
securities Beneficially Owned by such Person any securities acquired directly
from the Company) representing 25% or more of the combined voting power of the
Company's then outstanding securities; or

                  (iv) the stockholders of the Company approve a plan of
complete liquidation or dissolution of the Company or there is consummated an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets, other than a sale or disposition by the Company of all
or substantially all of the Company's assets to an entity at least a majority of
the board of directors of which comprises individuals who were directors of the
Company immediately prior to such sale or disposition.

         i. "Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor thereto.

         j. "Committee" means any committee or subcommittee the Board may
appoint to administer the Plan. If at any time or to any extent the Board shall
not administer the Plan, then the functions of the Administrator specified in
the Plan shall be exercised by the Committee. From and after the consummation of
a Public Offering, the composition of the Committee shall at all times consist
solely of persons who are (i) "Nonemployee Directors" as defined in Rule 16b-3
issued under the Exchange Act, and (ii) unless otherwise determined by the
Board, "outside directors" as defined in section 162(m) of the Code.

         k. "Common Stock" means the common stock, par value $0.01 per share, of
the Company.

         l. "Company" means AMERIGROUP Corporation, a Delaware corporation (or
any successor corporation).

         m. "Disability" means (1) any physical or mental condition that would
qualify a Participant for a disability benefit under any long-term disability
plan maintained by the Company (or by the Parent, Subsidiary or Affiliate by
which he is employed); (2) when used in connection with the exercise of an
Incentive Stock Option following termination of employment, disability within
the meaning of section 22(e)(3) of the Code; or (3) such other condition as may
be determined in the sole discretion of the Administrator to constitute
Disability.

3
<PAGE>   4
         n. "Eligible Recipient" means an employee, officer, director (including
a nonemployee director), consultant or advisor of the Company or of any Parent,
Subsidiary or Affiliate.

         o. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.

         p. "Exercise Price" means the per share price at which a holder of an
Option may purchase the Shares issuable upon exercise of the Option.

         q. "Fair Market Value" as of a particular date shall mean the fair
market value of a share of Common Stock as determined by the Administrator in
its sole discretion; provided that (i) if the Common Stock is admitted to
trading on a national securities exchange, fair market value of a share of
Common Stock on any date shall be the closing sale price reported for such share
on such exchange on the last day preceding such date on which a sale was
reported, (ii) if the Common Stock is admitted to quotation on the National
Association of Securities Dealers Automated Quotation ("Nasdaq") System or other
comparable quotation system and has been designated as a National Market System
("NMS") security, fair market value of a share of Common Stock on any date shall
be the closing sale price reported for such share on such system on the last
date preceding such date on which a sale was reported, or (iii) if the Common
Stock is admitted to quotation on the Nasdaq System but has not been designated
as an NMS security, fair market value of a share of Common Stock on any date
shall be the average of the highest bid and lowest asked prices of such share on
such system on the last date preceding such date on which both bid and ask
prices were reported.

4
<PAGE>   5
         r. "Immediate Family" means any child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law or sister-in-law, including adoptive
relationships of the Participant; trusts for the benefit of such immediate
family members; or partnerships in which such immediate family members are the
only partners.

         s. "Incentive Stock Option" shall mean an Option that is an "incentive
stock option" within the meaning of section 422 of the Code, or any successor
provision, and that is designated by the Committee as an Incentive Stock Option.

         t. "Nonqualified Stock Option" means any Option that is not an
Incentive Stock Option, including any Option that provides (as of the time such
Option is granted) that it will not be treated as an Incentive Stock Option.

         u. "Option" means an Incentive Stock Option, a Nonqualified Stock
Option, or either or both of them, as the context requires.

         v. "Other Award" means an Award granted pursuant to Section 12 hereof.

         w. "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations in the chain (other than the Company) owns stock possessing 50% or
more of the combined voting power of all classes of stock in one of the other
corporations in the chain.

         x. "Participant" means any Eligible Recipient selected by the
Administrator, pursuant to the Administrator's authority in Section 3 hereof, to
receive grants of Options or awards of Restricted Stock, Phantom Stock, Stock
Bonus or Other Awards. A Participant who receives the grant of an Option is
sometimes referred to herein as "Optionee."

         y. "Person" shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except
that such term shall not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an employee benefit
plan of the Company or any of its Affiliates, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, or (iv) a
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company.

         z. "Phantom Stock" means the right to receive in cash the Fair Market
Value of a Share granted pursuant to Section 9 hereof.

         aa. "Public Offering" means the first underwritten initial public
offering of Shares by the Company.

         bb. "Restricted Stock" means Shares subject to certain restrictions
granted pursuant to Section 8 hereof.

                                       5
<PAGE>   6
         cc. "Shares" means shares of Common Stock and any successor security.

         dd. "Stock Bonus" means the right to receive a Share granted pursuant
to Section 10 hereof.

         ee. "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations (other than the last corporation) in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain.

3.       ADMINISTRATION.

         a. The Plan shall be administered by the Board or, at the Board's sole
discretion, by the Committee, which shall serve at the pleasure of the Board.
Pursuant to the terms of the Plan, the Administrator shall have the power and
authority, without limitation:

                  (i) to select those Eligible Recipients who shall be
Participants;

                  (ii) to determine whether and to what extent Options or awards
of Restricted Stock, Phantom Stock, Stock Bonus or Other Awards are to be
granted hereunder to Participants;

                  (iii) to determine the number of Shares to be covered by each
Award granted hereunder;

                  (iv) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of each Award granted hereunder;

                  (v) to determine the terms and conditions, not inconsistent
with the terms of the Plan, which shall govern all written instruments
evidencing Options or awards of Restricted Stock, Phantom Stock, Stock Bonus or
Other Awards granted hereunder;

                  (vi) to adopt, alter and repeal such administrative rules,
guidelines and practices governing the Plan as it shall from time to time deem
advisable; and

                  (vii) to interpret the terms and provisions of the Plan and
any Award issued under the Plan (and any Award Agreement relating thereto), and
to otherwise supervise the administration of the Plan.

         b. The Administrator may, in its absolute discretion, without amendment
to the Plan, (i) accelerate the date on which any Option granted under the Plan
becomes exercisable, waive or amend the operation of Plan provisions respecting
exercise after termination of employment or otherwise adjust any of the terms of
such Option, and (ii) accelerate the lapse of restrictions, or waive any
condition imposed hereunder, with respect to any Restricted Stock or Phantom
Stock

6
<PAGE>   7
or otherwise adjust any of the terms applicable to any such Award; provided that
no action under this Section 3(b) shall adversely affect any outstanding Award
without the consent of the holder thereof.

         c. All decisions made by the Administrator pursuant to the provisions
of the Plan shall be final, conclusive and binding on all persons, including the
Company and the Participants. No member of the Board or the Committee, nor any
officer or employee of the Company acting on behalf of the Board or the
Committee, shall be personally liable for any action, determination, or
interpretation taken or made in good faith with respect to the Plan, and all
members of the Board or the Committee and each and any officer or employee of
the Company acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company in respect of any such action,
determination or interpretation.

         d. With respect to participants who are not "covered employees" within
the meaning of Section 162(m) of the Code and who are not subject to the
reporting requirements of Section 16(a) of the Exchange Act, the Board or the
Committee, as the case may be, may in its discretion delegate its authority
under this Section 3 to an officer of the Company.

4.       SHARES RESERVED FOR ISSUANCE UNDER THE PLAN.

         a. The total number of Shares reserved and available for issuance under
the Plan shall be 4,128,000 Shares based upon the capitalization of the
Company prior to the stock split effected in connection with the Public
Offering. Such Shares may consist, in whole or in part, of authorized and
unissued Shares or treasury shares. The grant of Phantom Stock shall not reduce
the number of shares of Common Stock with respect to which Awards may be granted
pursuant to the Plan.

         b. To the extent that (i) an Option expires or is otherwise cancelled
or terminated without being exercised as to the underlying Shares, or (ii) any
Shares subject to any award of Restricted Stock, Phantom Stock or Other Awards
are forfeited, such Shares shall again be available for issuance in connection
with future Awards granted under the Plan. If any Shares have been pledged as
collateral for indebtedness incurred by a Participant in connection with the
exercise of an Option and such Shares are returned to the Company in
satisfaction of such indebtedness, such Shares shall again be available for
issuance in connection with future Awards granted under the Plan.

         c. From and after the date that the Plan is intended to comply with the
requirements of Section 162(m) of the Code, the aggregate number of Shares with
respect to which Awards (including Awards payable in cash but denominated in
Common Stock, i.e., Phantom Stock) may be granted to any individual Optionee
during any fiscal year shall not exceed 1,000,000.

5.       EQUITABLE ADJUSTMENTS

         In the event of any Change in Capitalization, an equitable substitution
or proportionate adjustment shall be made in (i) the aggregate number and/or
kind of shares of common stock

7
<PAGE>   8
reserved for issuance under the Plan, (ii) the kind, number and/or option price
of shares of stock or other property subject to outstanding Options granted
under the Plan, and (iii) the kind, number and/or purchase price of shares of
stock or other property subject to outstanding awards of Restricted Stock,
Phantom Stock and Other Awards granted under the Plan, in each case as may be
determined by the Administrator, in its sole discretion. Such other equitable
substitutions or adjustments shall be made as may be determined by the
Administrator, in its sole discretion. Without limiting the generality of the
foregoing, in connection with a Change in Capitalization, the Administrator may
provide, in its sole discretion, for the cancellation of any outstanding Awards
in exchange for payment in cash or other property of the Fair Market Value of
the Shares covered by such Awards reduced, in the case of Options, by the
exercise price thereof.

6.       ELIGIBILITY.

         The Participants under the Plan shall be selected from time to time by
the Administrator, in its sole discretion, from among Eligible Recipients. The
Administrator shall have the authority to grant to any Eligible Recipient
Incentive Stock Options, Nonqualified Stock Options, Restricted Stock, Phantom
Stock, a Stock Bonus or Other Awards, provided that directors of the Company or
any Parent, Subsidiary or Affiliate, and individuals who are consultants or
advisors to the Company or any Parent, Subsidiary or Affiliate, who are not also
employees of the Company or of any Parent or Subsidiary may not be granted
Incentive Stock Options.

8
<PAGE>   9
7.       OPTIONS.

         a. General. Options may be granted alone or in addition to other Awards
granted under the Plan. Any Option granted under the Plan shall be evidenced by
an Award Agreement in such form as the Administrator may from time to time
approve. The provisions of each Option need not be the same with respect to each
Participant. Participants who are granted Options shall enter into an Award
Agreement with the Company, in such form as the Administrator shall determine,
which Award Agreement shall set forth, among other things, the Exercise Price of
the Option, the term of the Option and provisions regarding exercisability of
the Option granted thereunder. The Options granted under the Plan may be of two
types: (i) Incentive Stock Options and (ii) Nonqualified Stock Options. To the
extent that any Option does not qualify as an Incentive Stock Option, it shall
constitute a separate Nonqualified Stock Option. More than one Option may be
granted to the same Participant and be outstanding concurrently hereunder.
Options granted under the Plan shall be subject to the terms and conditions set
forth in paragraphs (b)-(m) of this Section 7 and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Administrator shall deem desirable.

         b. Exercise Price. The per share Exercise Price of Shares purchasable
under an Option shall be determined by the Administrator in its sole discretion
at the time of grant but shall not, in the case of Incentive Stock Options, be
less than 100% of the Fair Market Value per Share on such date (110% of the Fair
Market Value per Share on such date if, on such date, the Eligible Recipient
owns (or is deemed to own under the Code) stock possessing more than 10% (a "Ten
Percent Owner") of the total combined voting power of all classes of Common
Stock).

         c. Option Term. The term of each Option shall be fixed by the
Administrator, but no Option shall be exercisable more than ten years after the
date such Option is granted. If the Eligible Participant is a Ten Percent Owner,
an Incentive Stock Option may not be exercisable after the expiration of five
years from the date such Incentive Stock Option is granted.

         d. Exercisability. Options shall be exercisable at such time or times
and subject to such terms and conditions, including the attainment of
preestablished corporate performance goals, as shall be determined by the
Administrator in the Award Agreement or after the time of grant, provided that
no action under this Section 7(d) following the time of grant shall adversely
affect any outstanding Option without the consent of the holder thereof. The
Administrator may also provide that any Option shall be exercisable only in
installments, and the Administrator may waive such installment exercise
provisions at any time, in whole or in part, based on such factors as the
Administrator may determine in its sole discretion.

         e. Early Exercise. The Administrator may provide at the time of grant
or any time thereafter, in its sole discretion, that any Option shall be
exercisable with respect to Shares that otherwise would not then be exercisable,
provided that, in connection with such exercise, the Optionee enters into a form
of Restricted Stock Award Agreement approved by the Administrator.

9
<PAGE>   10
         f. Method of Exercise. Options may be exercised in whole or in part by
giving written notice of exercise to the Company specifying the number of Shares
to be purchased, accompanied by payment in full of the aggregate Exercise Price
of the Shares so purchased in cash or its equivalent, as determined by the
Administrator. As determined by the Administrator, in its sole discretion,
payment in whole or in part may also be made (i) by means of any cashless
exercise procedure approved by the Administrator, (ii) in the form of
unrestricted Shares or Shares of Restricted Stock already owned by the Optionee
for at least six months on the date of surrender or by the withholding of Shares
that would otherwise be issued pursuant to the option exercise, in each case to
the extent the Shares have a Fair Market Value on the date of surrender equal to
the aggregate option price of the Shares as to which such Option shall be
exercised, provided that, in the case of an Incentive Stock Option, the right to
make payment in the form of already owned Shares or Restricted Stock or withheld
shares may be authorized only at the time of grant, (iii) loans pursuant to
paragraph (h) of this Section 7, or (iv) any combination of the foregoing. If
payment of the Exercise Price is made in whole or in part in the form of
Restricted Stock, the Shares received upon the exercise of such Option shall be
restricted in accordance with the original terms of the Restricted Stock award
in question, except that the Administrator may direct that such restrictions
shall apply only to that number of Shares equal to the number of Shares
surrendered upon the exercise of such Option.

         g. Rights as Stockholder. An Optionee shall have no rights to dividends
or any other rights of a stockholder with respect to the Shares subject to the
Option until the Optionee has given written notice of exercise, has paid in full
for such Shares, has satisfied the requirements of Section 15 hereof and, if
requested, has given the representation described in paragraph (b) of Section 16
hereof.

         h. Loans. The Company or any Parent, Subsidiary or Affiliate may make
loans available to Optionees in connection with the exercise of outstanding
Options. Such loans shall (i) be evidenced by promissory notes entered into by
the Optionees in favor of the Company or any Parent or Subsidiary, (ii) bear
interest at the applicable federal interest rate or such other rate as the
Administrator shall determine, (iii) be subject to such other terms and
conditions, not inconsistent with the Plan, as the Administrator shall
determine, (iv) be made only with full recourse against the Optionee and (v) be
subject to Board approval (or to approval by the Administrator to the extent the
Board may delegate such authority); provided that each loan shall comply with
all applicable laws, regulations and rules of the Board of Governors of the
Federal Reserve System and any other governmental agency having jurisdiction. In
no event may the principal amount of any such loan exceed the aggregate Exercise
Price less the par value (if any) of the Shares covered by the Option, or
portion thereof, exercised by the holder. Unless the Administrator determines
otherwise, when a loan is made, Shares having an aggregate Fair Market Value at
least equal to the principal amount of the loan shall be pledged by the Optionee
to the Company as security for payment of the unpaid balance of the loan, and
such pledge shall be evidenced by a pledge agreement, the terms of which shall
be determined by the Administrator, in its sole discretion.

         i. Nontransferability of Options. The Optionee shall not be permitted
to sell,

10
<PAGE>   11
transfer, pledge or assign any Option other than by will and the laws of descent
and distribution and all Options shall be exercisable during the Participant's
lifetime only by the Participant, in each case, except as set forth in the
following two sentences. During an Optionee's lifetime and following a Public
Offering, the Administrator may, in its discretion, permit the transfer,
assignment or other encumbrance of an outstanding Option if such Option is a
Nonqualified Stock Option or an Incentive Stock Option that the Administrator
and the Participant intend to change to a Nonqualified Stock Option. Subject to
the approval of the Administrator and to any conditions that the Administrator
may prescribe, an Optionee may, upon providing written notice to the Company,
elect to transfer any or all Options described in the preceding sentence (i) to
members of his or her Immediate Family, provided that no such transfer by any
Participant may be made in exchange for consideration, or (ii) by instrument to
an inter vivos or testamentary trust in which the Options are to be passed to
beneficiaries upon the death of the Participant.

         j. Termination of Employment or Service. Except as otherwise provided
in an Award Agreement, if a Participant's employment with or service as a
director, consultant or advisor to the Company or any Parent, Subsidiary or
Affiliate terminates for any other reason than Cause, (i) Options granted to
such Participant, to the extent that they are exercisable at the time of such
termination, shall remain exercisable for a period of not less than 90 days
after such termination (six months in the case of termination by reason of death
or Disability), on which date they shall expire, and (ii) Options granted to
such Optionee, to the extent that they were not exercisable at the time of such
termination, shall expire on the date of such termination. In the event of the
termination of an Optionee's employment for Cause, all outstanding Options
granted to such Participant shall expire on the date of such termination.
Notwithstanding the foregoing, no Option shall be exercisable after the
expiration of its term.

         k. Nontransferability of Option Shares. Each Award Agreement evidencing
the grant of an Option shall provide that, prior to the occurrence of a Public
Offering, the Optionee shall not be permitted to sell, transfer, pledge,
hypothecate or assign Shares acquired upon exercise of an Option except by will
or the laws of descent and distribution.

         l. Limitation on Incentive Stock Options. To the extent that the
aggregate Fair Market Value of Shares with respect to which Incentive Stock
Options are exercisable for the first time by an Optionee during any calendar
year under the Plan and any other stock option plan of the Company shall exceed
$100,000, such Options shall be treated as Nonqualified Stock Options. Such Fair
Market Value shall be determined as of the date on which each such Incentive
Stock Option is granted.

         m. Nonemployee Director Formula Stock Options. The provisions of this
Section 7(m) shall apply only to grants of Nonqualified Stock Options to a
member of the Board who is not an employee of the Company and who owns less than
one percent of the voting power of the Company (a "Nonemployee Director").

                  (i) General. Nonemployee Directors shall receive Nonqualified
Stock Options under the Plan as set forth in this Section 7(m). The exercise
price per share of Common Stock purchasable pursuant to a Nonqualified Stock
Option granted to Nonemployee Director shall be

11
<PAGE>   12
the Fair Market Value of a Share of Common Stock on the date of grant.

                  (ii) Timing of Grant. As of the date of a Public Offering,
each Nonemployee Director then serving shall be granted a Nonqualified Stock
Option to purchase such number of Shares of Common Stock (including no Shares)
as may be determined by the Administrator in its sole discretion. Immediately
following his or her first election or appointment to the Board, each
Nonemployee Director shall be granted a Nonqualified Stock Option to purchase
such number of Shares of Common Stock (including no Shares) as may be determined
by the Administrator in its sole discretion, and immediately following each
annual meeting of stockholders, each Nonemployee Director (other than a
Nonemployee Director who is first appointed or elected to the Board at that
meeting) shall be granted a Nonqualified Stock Option to purchase such number of
Shares of Common Stock (including no Shares) as may be determined by the
Administrator in its sole discretion.

                  (iii) Method and Time of Payment. Each Nonqualified Stock
Option granted under this Section 7(m) shall be exercised in the manner
described in Section 7(f).

                  (iv) Term and Exercisability. Each Nonqualified Stock Option
granted under this Section 7(m) shall (1) become exercisable as the
Administrator in its sole discretion may provide in an applicable Award
Agreement and (2) expire ten years from the date of grant.

                  (v) Termination. Except as the Administrator in its sole
discretion may otherwise provide in an applicable Award Agreement, and subject
to the Administrator's amendment authority pursuant to Section 13, in the event
of the termination of a Nonemployee Director's service with the Company other
than for Cause, any outstanding Nonqualified Stock Option held by such
Nonemployee Director under this Section 7(m), to the extent that it is
exercisable on the date of such termination, may be exercised by such
Nonemployee Director (or, if applicable, by his or her executors, administrator,
legatees or distributees) during such period as may be provided in the Award
Agreement (or as may be otherwise determined by the Administrator) but in no
event following the expiration of such Nonqualified Stock Option, and the
remainder of the Nonqualified Stock Option which is not exercisable on the date
of such termination shall expire upon such termination. In the event of the
termination of a Nonemployee Director's service with the Company for Cause, all
outstanding Nonqualified Stock Options granted to such Nonemployee Director
shall expire. For purposes of the Plan, any termination of a Nonemployee
Director's service with the Company shall be deemed not to occur if the
Nonemployee Director continues to serve as consultant, employee or in any other
capacity.

8.       RESTRICTED STOCK.

         a. General. Awards of Restricted Stock may be issued either alone or in
addition to other Awards granted under the Plan and shall be evidenced by an
Award Agreement. The Administrator shall determine the Eligible Recipients to
whom, and the time or times at which, Awards of Restricted Stock shall be made;
the number of Shares to be awarded; the price, if any, to be paid by the
Participant for the acquisition of Restricted Stock; and the Restricted Period
(as defined in Section 8(d)) applicable to awards of Restricted Stock. The
provisions of the awards

12
<PAGE>   13
of Restricted Stock need not be the same with respect to each Participant.

         b. Purchase Price. The price per Share, if any, that a Recipient must
pay for Shares purchasable under an award of Restricted Stock shall be
determined by the Administrator in its sole discretion at the time of grant.

         c. Awards and Certificates. The prospective recipient of an Award of
Restricted Stock shall not have any rights with respect to any such Award,
unless and until such recipient has executed an Award Agreement evidencing the
Award and delivered a fully executed copy thereof to the Company, within such
period as the Administrator may specify after the award date. Each Participant
who is granted an award of Restricted Stock shall be issued a stock certificate
in respect of such shares of Restricted Stock, which certificate shall be
registered in the name of the Participant and shall bear an appropriate legend
referring to the terms, conditions, and restrictions applicable to any such
Award, provided that the Company may require that the stock certificates
evidencing Restricted Stock granted hereunder be held in the custody of the
Company until the restrictions thereon shall have lapsed, and that, as a
condition of any award of Restricted Stock, the Participant shall have delivered
a stock power, endorsed in blank, relating to the Shares covered by such Award.

         d. Nontransferability. Any Award of Restricted Stock granted pursuant
to this Section 8 shall be subject to the restrictions on transferability set
forth in this paragraph (d). During such period as may be set by the
Administrator in the Award Agreement (the "Restricted Period"), the Participant
shall not be permitted to sell, transfer, pledge, hypothecate or assign Shares
of Restricted Stock awarded under the Plan except by will or the laws of descent
and distribution, provided that the Administrator may, in its sole discretion,
provide for the lapse of such restrictions in installments and may accelerate or
waive such restrictions in whole or in part based on such factors and such
circumstances as the Administrator may determine in its sole discretion. The
Administrator may also impose such other restrictions and conditions, including
the achievement of preestablished corporate performance goals, on awarded
Restricted Stock as it deems appropriate. In no event shall the Restricted
Period end with respect to a Restricted Stock Award prior to the satisfaction by
the Participant of any liability arising under Section 15 hereof. Any attempt to
dispose of any Restricted Stock in contravention of any such restrictions shall
be null and void and without effect.

         e. Rights as a Stockholder. Except as provided in Section 8(c) and (d),
the Participant shall possess all incidents of ownership with respect to Shares
of Restricted Stock during the Restricted Period, including the right to receive
or reinvest dividends with respect to such Shares and to vote such Shares.
Certificates for unrestricted Shares shall be delivered to the Participant
promptly after, and only after, the Restricted Period shall expire without
forfeiture in respect of such awards of Restricted Stock except as the
Administrator, in its sole discretion, shall otherwise determine.

         f. Termination of Employment. The rights of Participants granted an
Award of Restricted Stock upon termination of employment with or service as a
director of or consultant or advisor to the Company or any Parent, Subsidiary or
Affiliate for any reason during the

13
<PAGE>   14
Restricted Period shall be set forth in the Award Agreement governing such
Award.

         g. Early Exercise Options. The Administrator shall award Restricted
Stock to a Participant upon the Participant's early exercise of an Option under
Section 7(e) hereof. Unless otherwise determined by the Administrator, the lapse
of restrictions with respect to such Restricted Stock shall occur on the same
schedule as the Option for which the Restricted Stock was exercised.

         h. Loans. In the sole discretion of the Administrator, loans may be
made to Participants in connection with the purchase of Restricted Stock under
substantially the same terms and conditions as provided in Section 7(h) of the
Plan with respect to the exercise of Options.

9.       PHANTOM STOCK

         (a) Vesting. At the time of the grant of Shares of Phantom Stock, the
Committee may impose such restrictions or conditions to the vesting of such
Shares (including the achievement of preestablished corporate performance goals)
as it, in its sole discretion, deems appropriate, to be contained in the Award
Agreement. The Committee may divide such Phantom Stock into classes and assign
different vesting conditions for each class. Provided that all conditions to the
vesting of a share of Phantom Stock are satisfied, and except as provided in
Section 9(c), upon the satisfaction of all vesting conditions with respect to a
Share of Phantom Stock, such Share shall vest.

         (b) Benefit Upon Vesting. Upon the vesting of a Share of Phantom Stock,
the Participant shall be entitled to receive, within 30 days of the date on
which such Share vests, an amount in cash or Common Stock with a Fair Market
Value equal to the sum of (1) the Fair Market Value of a Share of Common Stock
on the date on which such Share of Phantom Stock vests and (2) the aggregate
amount of cash dividends paid with respect to a Share of Common Stock during the
period commencing on the date on which the Share of Phantom Stock was granted
and terminating on the date on which such Share vests.

         (c) Termination of Employment. The rights of Participants granted an
Award of Phantom Stock upon termination of employment with or service as a
director of or consultant or advisor to the Company or any Parent, Subsidiary or
Affiliate for any reason before the Phantom Stock vests shall be set forth in
the Award Agreement governing such Award.

10.      STOCK BONUS AWARDS

         In the event that the Committee grants a Stock Bonus, a certificate for
the shares of Common Stock constituting such Stock Bonus shall be issued in the
name of the Participant to whom such grant was made and delivered to such
Participant as soon as practicable after the date on which such Stock Bonus is
payable.

11.      EFFECT OF CHANGE IN CONTROL.

14
<PAGE>   15
         Except as otherwise provided in an Award Agreement, all outstanding
Shares of Restricted Stock and Phantom Stock granted to a Participant which have
not theretofore vested shall immediately vest and all restrictions on such
Shares shall immediately lapse, and each Option granted to a Participant and
outstanding at such time shall become fully and immediately exercisable, if (i)
there is a Change in Control following a Public Offering and (ii) the
Participant's employment with or service as a director, consultant or advisor to
the Company or any Parent, Subsidiary or Affiliate is terminated by such entity
for any reason other than for Cause within 2 years following the Change in
Control, or the Participant terminates employment with (or other service to) the
Company or any Parent, Subsidiary or Affiliate within 2 years following the
Change in Control and after there is a material adverse change in the nature or
status of the Participant's duties or responsibilities from those in effect
immediately prior to the Change in Control.

12.      OTHER AWARDS.

         Other forms of Awards ("Other Awards") valued in whole or in part by
reference to, or otherwise based on, Common Stock may be granted either alone or
in addition to other Awards under the Plan. Subject to the provisions of the
Plan, the Administrator shall have sole and complete authority to determine the
persons to whom and the time or times at which such Other Awards shall be
granted, the number of Shares to be granted pursuant to such Other Awards and
all other conditions of such Other Awards.

13.      AMENDMENT AND TERMINATION.

         The Board may amend, alter or discontinue the Plan, but no amendment,
alteration, or discontinuation shall be made that would impair the rights of a
Participant under any Award theretofore granted without such Participant's
consent. Unless the Board determines otherwise, the Board shall obtain approval
of the Company's stockholders for any amendment that would require such approval
in order to satisfy the requirements of section 162(m), section 422 of the Code,
stock exchange rules or other applicable law. The Administrator may amend the
terms of any Award theretofore granted, prospectively or retroactively, but,
subject to Section 4 of Plan, no such amendment shall impair the rights of any
Participant without his or her consent.

14.      UNFUNDED STATUS OF PLAN.

         The Plan is intended to constitute an "unfunded" plan for incentive
compensation. With respect to any payments not yet made to a Participant by the
Company, nothing contained herein shall give any such Participant any rights
that are greater than those of a general creditor of the Company.

15.      WITHHOLDING TAXES.

         (a) Whenever cash is to be paid pursuant to an Award, the Company shall
have the right to deduct therefrom an amount sufficient to satisfy any federal,
state and local withholding

15
<PAGE>   16
tax requirements related thereto. Whenever Shares are to be delivered pursuant
to an Award, the Company shall have the right to require the Participant to
remit to the Company in cash an amount sufficient to satisfy any federal, state
and local withholding tax requirements related thereto. With the approval of the
Administrator, a Participant may satisfy the foregoing requirement by electing
to have the Company withhold from delivery Shares or by delivering Shares
already owned by the Participant for at least six months, in each case, having a
value equal to the minimum amount of tax required to be withheld. Such shares
shall be valued at their Fair Market Value on the date of which the amount of
tax to be withheld is determined. Fractional share amounts shall be settled in
cash. Such an election may be made with respect to all or any portion of the
shares to be delivered pursuant to an Award.

         (b) If the Participant makes a disposition, within the meaning of
Section 424(c) of the Code and regulations promulgated thereunder, of any Share
or Shares issued to such Participant pursuant to such Participant's exercise of
an Incentive Stock Option, and such disposition occurs within the two-year
period commencing on the day after the date of grant or within the one-year
period commencing on the day after the date of exercise, such Participant shall,
within ten (10) days of such disposition, notify the Company thereof and
thereafter immediately deliver to the Company any amount of federal, state or
local income taxes and other amounts which the Company informs the Participant
the Company is required to withhold.

16.      GENERAL PROVISIONS.

         a. Shares shall not be issued pursuant to the exercise of any Award
granted hereunder unless the exercise of such Award and the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act and the requirements of any stock exchange upon which
the Common Stock may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.

         b. The Administrator may require each person acquiring Shares to
represent to and agree with the Company in writing that such person is acquiring
the Shares without a view to distribution thereof. The certificates for such
Shares may include any legend that the Administrator deems appropriate to
reflect any restrictions on transfer.

         c. All certificates for Shares delivered under the Plan shall be
subject to such stock-transfer orders and other restrictions as the
Administrator may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Common Stock may then be listed, and any applicable federal or state
securities law, and the Administrator may cause a legend or legends to be placed
on any such certificates to make appropriate reference to such restrictions.

         d. Nothing contained in the Plan shall prevent the Board from adopting
other or additional compensation arrangements, subject to stockholder approval,
if such approval is required; and such arrangements may be either generally
applicable or applicable only in specific cases. The adoption of the Plan shall
not confer upon any Eligible Recipient any right to

16
<PAGE>   17
continued employment or service with the Company or any Parent, Subsidiary or
Affiliate, as the case may be, nor shall it interfere in any way with the right
of the Company or any Parent, Subsidiary or Affiliate to terminate the
employment or service of any of its Eligible Recipients at any time.

         e. The Plan and all Awards shall be governed by the laws of the State
of Delaware without regard to its principles of conflict of laws.

17.      STOCKHOLDER APPROVAL; EFFECTIVE DATE OF PLAN.

         a. The grant of any Award hereunder shall be contingent upon
stockholder approval of the Plan being obtained within 12 months before or after
the date the Board adopts the Plan.

         b. Subject to the approval of the Plan by the stockholders of the
Company within twelve (12) months before or after the date the Plan is adopted
by the Board, the Plan shall take effect upon its adoption by the Board.

18.      TERM OF PLAN.

         No Award shall be granted pursuant to the Plan on or after the tenth
anniversary of the Effective Date, but Awards theretofore granted may extend
beyond that date.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}]]