Document:

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                                                                    EXHIBIT 10.1

                           PRODUCT SOURCING AGREEMENT

                                  PSA NO 900622

                    LUCENT TECHNOLOGIES AUSTRALIA PTY LIMITED

                               ABN 44 002 326 687

                                       AND
                           TELSTRA CORPORATION LIMITED

                               ABN 33 051 775 556

                                  12 JULY 2001

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                                    CONTENTS

<TABLE>
<S>                                                                                          <C>
CONTENTS                                                                                       i

SCHEDULES                                                                                    vii

1.  INTERPRETATION                                                                             9

    1.1      Definitions                                                                       9
    1.2      Interpretation                                                                   21
    1.3      Inconsistency between documents comprising agreement                             22

2.  TERM OF AGREEMENT                                                                         23

    2.1      Commencement and expiry                                                          23
    2.2      Renewal                                                                          23
    2.3      Consideration                                                                    23
    2.4      Orders prior to commencement                                                     23
    2.5      Periodic review                                                                  23
    2.6      Quarterly review                                                                 24
    2.7      Enhanced ordering process                                                        24

3.  RESPONSIBILITIES OF THE PARTIES                                                           24

    3.1      Appointment of Lucent                                                            24
    3.2      Role of Lucent                                                                   24
    3.3      EDI                                                                              25
    3.4      Telstra's commitment and discount                                                25

4.  FORECASTING                                                                               26

    4.1      Telstra to give Forecasts                                                        26
    4.2      Forecasts not binding on Telstra                                                 27
    4.3      No reliance                                                                      27
    4.4      No obligation                                                                    27
    4.5      Minimisation of stock                                                            27

5.  ORDERING AND FORMATION OF CONTRACTS                                                       27

    5.1      Purchase Orders                                                                  27
    5.2      Requirements for Purchase Orders                                                 27
    5.3      Ordering Authority                                                               28
    5.4      Lead Time                                                                        28
    5.5      Quantity of Equipment that has been Forecast but exceeding Lucent Capacity       28
    5.6      Quantity of Equipment exceeding Forecast and Lucent Capacity                     29
    5.7      Design Information Sheet                                                         29
    5.8      Request for frequencies                                                          30
    5.9      Formation of Contract and consistency                                            30
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<TABLE>
<S>                                                                                           <C>
    5.10     Right of Telstra to cancel a Purchase Order                                      30
    5.11     Carrier arrangements                                                             30
    5.12     Temporary storage and risk for Telstra                                           31
    5.13     Packing and labelling                                                            31

6.  AUSTRALIAN CONTENT                                                                        31

    6.1      Level of Australian Content                                                      31
    6.2      Australian Content                                                               32

7.  EMPLOYEES                                                                                 32

8.  REPORTS                                                                                   32

9.  NEW EQUIPMENT                                                                             33

    9.1      Programme for release                                                            33
    9.2      Approval                                                                         33
    9.3      Specification for New Equipment and testing                                      33
    9.4      Lucent to provide test facilities                                                33
    9.5      Supply of specifications                                                         34
    9.6      Statements, proofs and certificates of compliance                                34
    9.7      Type Approval                                                                    34

10. DOCUMENTATION                                                                             34

    10.1     Manufacturer's Documentation                                                     34
    10.2     Amendment of Specifications                                                      35
    10.3     No relief of responsibility                                                      35

11. TESTING                                                                                   35

    11.1     Functional system testing                                                        35
    11.2     Lucent to invite Telstra to witness testing                                      35
    11.3     Telstra may witness                                                              36
    11.4     Telstra not liable to pay costs                                                  36
    11.5     Remedies for rejected Equipment                                                  36
    11.6     Lucent's and Telstra's responsibilities                                          37
    11.7     No relief of responsibility                                                      37
    11.8     Telstra may test                                                                 37
    11.9     Compliance with Specifications                                                   37
    11.10    Independent Certifier                                                            37

12. TELSTRA DELAY                                                                             38

    12.1     Basis for extension of time                                                      38
    12.2     Application assessment for Telstra Delay                                         38
    12.3     No relief of obligations                                                         38
</TABLE>

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<TABLE>
<S>                                                                                           <C>
13. FORCE MAJEURE EVENT                                                                       38

14. KEY PERFORMANCE INDICATORS                                                                40

    14.1     Compliance with KPIs and remediation                                             40
    14.2     KPI Reports                                                                      40

15. PASSING OF PROPERTY                                                                       41

16. WARRANTIES                                                                                41

    16.1     Design Defects                                                                   41
    16.2     Design Defect obligations                                                        41
    16.3     Availability of components                                                       41
    16.4     Minimisation of costs regarding Design Defects                                   41
    16.5     Defects                                                                          42
    16.6     Additional obligations regarding Defects                                         42
    16.7     No obligation regarding Defects                                                  43
    16.8     No Defect Found                                                                  44
    16.9     Joint field investigations                                                       44
    16.10    Warranty regarding compatibility                                                 44

17. PRICES                                                                                    44

    17.1     Fixed Contract Prices                                                            44
    17.2     Prices for items not listed                                                      45
    17.3     WBV and WBP                                                                      45
    17.4     Determination of Contract Prices                                                 45
    17.5     Previous Contract Price applicable pending Determination                         45

18. VARIATIONS OF CONTRACT PRICES                                                             46

    18.1     Taxes                                                                            46
    18.2     Changes in Customs Duty                                                          46
    18.3     Dumping and countervailing duty                                                  46
    18.4     Responsibility for variations                                                    47
    18.5     Telstra not liable                                                               47
    18.6     Approval of variations                                                           47
    18.7     Lucent to make application                                                       47
    18.8     Telstra may support                                                              48
    18.9     Lucent to retain records                                                         48
    18.10    Exchange rate variation                                                          48

19. GST                                                                                       49

    19.1     Imposition of GST                                                                49
    19.2     Adjustment of GST subject to Telstra's approval                                  49
    19.3     Reductions in prices to reflect abolition or reduction of Taxes                  49
    19.4     Compliance with the Trade Practices Act                                          50
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<TABLE>
<S>                                                                                           <C>
    19.5     Lucent to retain records                                                         50
    19.6     Telstra's GST payment reduced where Lucent has received GST tax credit or
             refund from third party                                                          51
    19.7     Lucent to pay GST where Telstra is providing a taxable supply to Lucent          51

20. INVOICES AND PAYMENT                                                                      52

    20.1     Invoicing information                                                            52
    20.2     Delivery of invoices                                                             52
    20.3     EDI trading agreement                                                            52
    20.4     Payment                                                                          52
    20.5     Late payment                                                                     52

21. ACCESS TO TELSTRA'S FACILITIES AND AUDIT                                                  53

    21.1     Access                                                                           53
    21.2     Terms of access                                                                  53
    21.3     Records and audit                                                                53

22. STRUCTURED FINANCING                                                                      53

23. INTELLECTUAL PROPERTY                                                                     54

    23.1     Price includes all royalties                                                     54
    23.2     Granting of licences                                                             54
    23.3     Third party licences                                                             54
    23.4     Ownership of Lucent Intellectual Property                                        54
    23.5     Infringement                                                                     55
    23.6     Where Third Party Claim made                                                     55
    23.7     Improvements                                                                     55
    23.8     Moral rights                                                                     56
    23.9     Year 2000 Compliance                                                             56

24. CONFIDENTIALITY                                                                           57

    24.1     Confidentiality obligations                                                      57
    24.2     Permitted disclosures                                                            57
    24.3     Disclosure to the Commonwealth                                                   58
    24.4     Return of Confidential Information                                               58
    24.5     Injunctive relief                                                                58
    24.6     Public announcements                                                             58
    24.7     Enforcement                                                                      59

25. REPRESENTATIONS AND WARRANTIES                                                            59

26. INDEMNITY                                                                                 60

    26.1     Indemnity                                                                        60
    26.2     Consequential loss                                                               61
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<TABLE>
<S>                                                                                           <C>
    26.3     Limitation of liability                                                          61

27. TERMINATION                                                                               61

    27.1     Right of Telstra to terminate                                                    61
    27.2     Right of Lucent to terminate                                                     62
    27.3     Termination with notice                                                          62
    27.4     Telstra's rights on termination                                                  63
    27.5     Early termination                                                                63
    27.6     Antecedent breaches and obligations                                              63
    27.7     Surviving obligations                                                            64

28. RESOLUTION OF DISPUTES                                                                    64

    28.1     Commitment                                                                       64
    28.2     Dispute notice                                                                   64
    28.3     Good faith discussions                                                           64
    28.4     Mediation                                                                        65
    28.5     Independent expert                                                               65
    28.6     No legal proceedings                                                             66
    28.7     Continuation of obligations                                                      66

29. ASSIGNMENT                                                                                66

    29.1     Assignment requires consent                                                      66
    29.2     Telstra's rights                                                                 66
    29.3     Lucent's rights                                                                  67

30. SUBCONTRACTING                                                                            67

    30.1     Lucent may subcontract with consent                                              67
    30.2     Subcontract must be consistent                                                   67
    30.3     Removal of subcontractor                                                         67
    30.4     Lucent not relieved of obligations                                               67

31. DELEGATION BY TELSTRA                                                                     68

    31.1     Appointment                                                                      68
    31.2     Lucent to deal with agents                                                       68
    31.3     Telstra communications prevail                                                   68

32. SALE OF EQUIPMENT BY TELSTRA                                                              68

33. INSURANCE                                                                                 69

    33.1     Insurance                                                                        69
    33.2     Insurance requirements                                                           70
    33.3     Public liability insurance                                                       70
    33.4     Professional indemnity                                                           71
    33.5     Compliance with insurance policy terms                                           71
</TABLE>

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<TABLE>
<S>                                                                                           <C>
    33.6     Registration as employer                                                         71
    33.7     Evidence of insurance                                                            71
    33.8     Condition precedent                                                              71
    33.9     Dealings with Insurers                                                           71

34. OCCUPATIONAL HEALTH AND SAFETY                                                            71

35. NOTICES                                                                                   73

    35.1     Types of notice                                                                  73
    35.2     Addresses                                                                        74
    35.3     Notice takes effect                                                              74
    35.4     Deemed receipt                                                                   74

36. MISCELLANEOUS                                                                             74

    36.1     No partnership                                                                   74
    36.2     Co-operation                                                                     74
    36.3     Severance                                                                        75
    36.4     Variations                                                                       75
    36.5     Waivers                                                                          75
    36.6     Rights cumulative                                                                75
    36.7     Entire agreement                                                                 76
    36.8     Counterparts                                                                     76
    36.9     Compliance with Law                                                              76
    36.10    Law and jurisdiction                                                             76
    36.11    Attorneys                                                                        76
    36.12    Costs                                                                            76
    36.13    Stamp duty                                                                       76
    36.14    Enforcement of indemnities                                                       76
    36.15    To the extent not excluded by law                                                77
    36.16    Notification of conflict of interest                                             77
</TABLE>

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                                    SCHEDULES

<TABLE>
<S>                                    <C>
Schedule  1.........................   Agreement Details

Schedule  2.........................   Contract Prices and List of Equipment

Schedule  3.........................   Lucent Capacity

Schedule  4.........................   Sites

Schedule  5.........................   Testing

Schedule  6.........................   Specification for Lucent SWING 3.1

Schedule  7.........................   Packing and Labelling

Schedule  8.........................   Key Performance Indicators

Schedule  9.........................   Deed of Novation and Assumption

Schedule 10.........................   Design Information Sheets

Schedule 11.........................   EDI Trading Agreement

Schedule 12.........................   Variation Form

Schedule 13.........................   Purchase Orders

Schedule 14.........................   Roadmap for New Equipment
</TABLE>

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                           PRODUCT SOURCING AGREEMENT

DATE 12 July 2001

PARTIES

         LUCENT TECHNOLOGIES AUSTRALIA PTY LIMITED ABN 44 002 326 687 of Level
         21, 133 Castlereagh Street, Sydney, New South Wales ("LUCENT")

         AND

         TELSTRA CORPORATION LIMITED ABN 33 051 775 556 of 242 Exhibition
         Street, Melbourne, Victoria ("TELSTRA")

RECITALS

A.       Telstra wants to roll-out a terrestrial base radio system in the
         Territory to replace the existing DRCS which is now becoming obsolete
         and, for this purpose, has selected the Equipment offered by Lucent.

B.       Telstra also wants to use the Equipment, in addition to replacing the
         DRCS throughout the Territory, as one of the technology solutions to be
         provided by Telstra under the Commonwealth Agreement.

C.       Lucent has advised Telstra that it has the capacity to provide the
         Equipment on the terms and conditions of this Agreement. In particular,
         Lucent has advised Telstra that the Equipment has the capability and
         functionality as specified in the Specification.

D.       Telstra also wants a technology solution that is capable of enhancement
         and modification throughout the life of the solution. Lucent has
         represented to Telstra that, while the Equipment can be used initially
         to provide analogue interface to the PSTN, the Equipment can be
         enhanced to provide digital interface to the PSTN and thereby increase
         both the data communication speed available to customers and the number
         of customer connections.

E.       Telstra has selected Lucent to provide the Equipment on the terms and
         conditions set out in this Agreement so that Telstra is able to replace
         the existing DRCS throughout the Territory and otherwise achieve the
         requirements of Telstra set out in this Agreement.

F.       Lucent has agreed with Telstra that it will provide Telstra with the
         Equipment on the terms and conditions set out in this Agreement.

                                                                               8

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OPERATIVE PROVISIONS

1.       INTERPRETATION

1.1      DEFINITIONS

         The following definitions apply in this Agreement, unless the contrary
         intention appears:

         "ACDC" means the Australian Commercial Disputes Centre.

         "ACDC MEDIATION GUIDELINES" means the mediation guidelines published by
         the ACDC and which are in force from time to time.

         "ADJUSTMENT NOTE" means a document that complies with the requirements
         relating to adjustment notes set out in the Goods and Services Tax Act
         and any regulations made in relation thereto and GST ruling
         "GSTR2000/1-adjustment notes" (as amended or replaced from time to
         time). Any Adjustment Note issued to Telstra pursuant to this Agreement
         must include (without limitation):

         (a)      the words "Adjustment Note" stated prominently;

         (b)      the name and ABN of Lucent;

         (c)      Telstra's name and either Telstra's ABN or Telstra's address;

         (d)      the date of issue of the Adjustment Note;

         (e)      the difference between the price of the supply or supplies
                  before the adjustment event and the new price of the supply or
                  supplies;

         (f)      a brief explanation of the reason for the adjustment; and

         (g)      the amount of the adjustment to the GST payable or a statement
                  to the effect that the difference in the price of the taxable
                  supply or supplies includes GST.

         Lucent acknowledges that it has agreed to include all of this
         information in every Adjustment Note issued to Telstra pursuant to this
         Agreement notwithstanding that Lucent may not always have an obligation
         to provide all of this information in every Adjustment Note pursuant to
         the provisions of the Goods and Services Tax Act.

         "AGREEMENT" means the agreement between the parties constituted by:

         (a)      the General Terms and Conditions; and

         (b)      the Schedules.

         "APPLICABLE PERIOD" has the meaning given in clause 17.5.

         "AUSTRALIAN CONTENT" means the Australian content of any Equipment as
         determined in accordance with clause 6.

                                                                               9

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         "AUSTRALIAN STANDARDS" means the standards published from time to time
         by the Standards Association of Australia.

         "BUSINESS DAY" means:

         (a)      subject to paragraphs (b) and (c) of this definition, a day
                  other than a Saturday, Sunday or public holiday in the
                  Australian jurisdiction in which the obligation is to be
                  performed;

         (b)      for the purposes of clause 35, a day other than a Saturday,
                  Sunday or public holiday in Melbourne, Victoria; and

         (c)      for the purposes of Schedule 8, a day other than a Saturday,
                  Sunday or public holiday in Sydney, New South Wales.

         "CARRIER" means the person specified in item 16 of Schedule 1, or its
         replacement as notified in writing from time to time by Telstra to
         Lucent.

         "COMMENCEMENT DATE" means the date specified in item 1 of Schedule 1.

         "COMMONWEALTH" means the Commonwealth of Australia.

         "COMMONWEALTH AGREEMENT" means the agreement dated 1 June 2001 entered
         into by the Commonwealth and Telstra for the provision of untimed local
         calls and other services in the Extended Zones.

         "CONFIDENTIAL INFORMATION" of a party means all information, know-how,
         ideas, concepts, technology, manufacturing processes, industrial,
         marketing and commercial knowledge of a confidential nature (whether in
         a tangible or intangible form) relating to or developed in connection
         with or in support of the business, products, services, sales,
         marketing or technical operations of that party and includes the
         contents of this Agreement (and any matter concerned with or arising
         out of this Agreement), but does not include:

         (a)      information which is in the public domain, other than through
                  a breach of a duty of confidence;

         (b)      information rightfully received by the other party from a
                  third person who is under no obligation of confidentiality to
                  the disclosing party and who has not obtained that information
                  either directly or indirectly as a result of a breach of any
                  duty of confidence owed to the disclosing party; or

         (c)      information which has been independently developed by the
                  other party.

         "CONTRACT" has the meaning given in clause 5.9.

                                                                              10

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         "CONTRACT PRICE" means in relation to an item of Equipment for which a
         Purchase Order is placed during:

         (a)      the first 12 month period of the Initial Period, the price of
                  that item of Equipment as specified in Schedule 2, and varied
                  as expressly permitted under this Agreement; and

         (b)      each subsequent 12 month period of the Initial Term and for
                  the Subsequent Period (if any), the price determined in
                  accordance with clause 17.4, and varied as expressly permitted
                  under this Agreement.

         "CONTRACT PURPOSES" means:

         (a)      the performance of Telstra's obligations under this Agreement
                  or a Contract;

         (b)      in relation to Hardware, the use, modification, adaptation,
                  development, maintenance, repair or enhancement of the
                  Hardware;

         (c)      in relation to Software, the use of the Software;

         (d)      specifying facilities, performance, or interface requirements
                  for the items of Equipment in requests for tenders for the
                  supply of related items of equipment to Telstra or to enable
                  the interface of any equipment, hardware or software to the
                  Equipment to the extent required to operate the items of
                  Equipment in Telstra's telecommunications network; and

         (e)      the exercise by Telstra of any of its rights under this
                  Agreement or a Contract.

         "DATE FOR LOADING" means, in relation to items of Equipment the subject
         of a Purchase Order:

         (a)      the date specified in that Purchase Order;

         (b)      such other date determined in accordance with clauses 5.5 or
                  5.6; or

         (c)      such other date determined in accordance with clauses 12 or
                  13,

         when those items of Equipment must be ready for Loading.

         "DEED OF ASSUMPTION AND NOVATION" means the deed to be entered into by
         Telstra, Lucent and NDC, substantially in the form of the document set
         out in Schedule 9, on or about the same day as the Commencement Date
         pursuant to which NDC is given the right to issue Purchase Orders under
         this Agreement.

         "DEFECT" means:

         (a)      any fault, failure, degradation, deficiency, error or
                  non-conformance of an item of Equipment;

         (b)      any non-conformance of an item of Equipment with the
                  Specification;

                                                                              11

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         (c)      any functionality or performance of an item of Equipment below
                  or not in accordance with the Specification; or

         (d)      any partial performance or non-performance of an item of
                  Equipment not in accordance with the Specification.

         "DESIGN DEFECT" means a design defect in an item of Equipment which:

         (a)      results in a continuing pattern of recurrent failures of the
                  same type, and which is not due to the normal wear and tear of
                  that item of Equipment, or use of that item of Equipment not
                  in accordance with the Specification and falls outside the
                  incidence of random failures for that item of Equipment; or

         (b)      results in the misoperation or failure of that item of
                  Equipment.

         "DESIGN INFORMATION SHEET" means the document to be provided by Telstra
         to Lucent, containing the information required by Lucent, in the form
         set out in Schedule 10.

         "DESIGN WARRANTY PERIOD" means:

         (a)      subject to paragraph (b) of this definition, in relation to an
                  item of Equipment, 5 years commencing from the Date for
                  Loading for that item of Equipment; and

         (b)      in relation to a Replacement Item, 5 years commencing from the
                  day Lucent makes that Replacement Item available to Telstra in
                  accordance with clause 16.

         "DISCLOSING PARTY" means a party which discloses, communicates or gives
         access to its Confidential Information to the other party.

         "DISPUTE" has the meaning given in clause 28.1.

         "DISPUTE NOTICE" has the meaning given in clause 28.2.

         "DOCUMENTATION" means the documentation or manuals for the Equipment
         set out in Schedule 2 to be provided by Lucent to Telstra under this
         Agreement or any Contract.

         "DRCS" means Digital Radio Concentrator System.

         "EDI" means the computer to computer exchange of structured messages in
         standardised form via open communications networks.

         "EDI TRADING AGREEMENT" means the agreement to be entered into by
         Telstra and Lucent governing electronic data interchange between the
         parties, substantially in the form set out in Schedule 11.

         "ENDORSED SUPPLIER" means a supplier who has been endorsed as such by
         the Commonwealth Department of Finance and Administration in accordance
         with the

                                                                              12

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         endorsed supplier arrangements criteria that the Department publishes
         from time to time.

         "EQUIPMENT":

         (a)      means Hardware, Software, SWING Network Manager, Documentation
                  and the other items specified in Schedule 2, to be supplied by
                  Lucent pursuant to a Contract; and

         (b)      unless the context expressly provides otherwise, includes New
                  Equipment and Replacement Items.

         "EXTENDED ZONES" means the geographic area in Australia:

         (a)      in which Telstra provides services which are described as
                  Extended Zone Services;

         (b)      which would be categorised as an Extended Zone, if a new
                  service in that zone would be classified as an Extended Zone
                  Service by application of the allocation rules regarding
                  location of customers as agreed between Telstra and the
                  Commonwealth from time to time; and

         (c)      which is not a Standard Zone.

         "EXTENDED ZONE SERVICE" means any service described as an Extended Zone
         Service in Telstra's standard form of agreement with a customer.

         "EXTENSION OF TIME" has the meaning given in clause 13(c).

         "FORECAST" has the meaning given in clause 4.1.

         "FORECAST DATE" has the meaning given in clause 4.1.

         "FORCE MAJEURE EVENT" means an event or circumstance that is beyond the
         reasonable control of Lucent and adversely affects, or is reasonably
         likely to adversely affect, the ability of Lucent to meet its
         obligations under this Agreement, being any one or more of the
         following:

         (a)      industrial conditions (being industrial disputes not confined
                  to Lucent or its subcontractors or equipment and material
                  suppliers);

         (b)      continuous inclement weather (being continuous inclement
                  weather at any site for more than 3 days constituted by rain
                  greater than 50 mm over the 3 day period);

         (c)      rain in areas with reactive clay soils (also known as "black
                  soil") which prevents 4 wheel drive vehicle and machinery
                  access necessary for Lucent to comply with its obligations
                  under this Agreement;

         (d)      a latent condition (including, without limitation, any
                  underground obstruction such as rock or facility, eg pipe, not
                  correctly marked on plans -

                                                                              13

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                  provided reasonable actions were taken by Lucent to locate any
                  such latent condition within the area);

         (e)      a change in Law (being a change that directly affects the time
                  to undertake site surveys, or receive approvals or land
                  clearances, or results in significant changes in design and
                  construction practices);

         (f)      the act of any Governmental Agency (including, without
                  limitation, refusal or revocation of a licence or consent);

         (g)      embargo, power or water shortage;

         (h)      a fire ban (being a ban that prevents the use of vehicles or
                  equipment (eg welding equipment) necessary for Lucent to
                  comply with its obligations under this Agreement);

         (i)      a delay in the granting of access under the Telecommunications
                  Act 1997 (Cth) due to an appeal by a land owner to the
                  Australian Communication Authority pursuant to the Australian
                  Communications Authority Act 1999 (Cth);

         (j)      any change in technical or industrial standards (ie that
                  results in a significant change in the planned design and
                  construction);

         (k)      vehicle wash down either at the request of the relevant
                  landowner or a Governmental Agency (eg required to prevent the
                  spread of an infectious livestock disease or noxious weed);

         (l)      inability to obtain access to any site or facility by reason
                  of any Law or action taken by any person (including, without
                  limitation, any native title claim);

         (m)      where access to any site or facility would expose any person
                  to danger or otherwise be contrary to occupational health and
                  safety requirements;

         (n)      a catastrophic event (eg fire, explosion, flood, cyclone,
                  crash) that delays the delivery of equipment or material
                  necessary for Lucent to comply with its obligations under this
                  Agreement provided no available stock or suitable alternative
                  product is available; or

         (o)      any other event or circumstance which, in the reasonable
                  opinion of Telstra, would constitute an event which is beyond
                  the reasonable control of Lucent.

         "GENERAL TERMS AND CONDITIONS" means clauses 1 to 36 inclusive, but
         excludes the Schedules.

         "GOODS AND SERVICES TAX ACT" means the A New Tax System (Goods and
         Services Tax) Act 1999 (Cth).

         "GOVERNMENTAL AGENCY" means any government or any governmental,
         semi-governmental, administrative, fiscal or judicial body, department,
         commission, authority, tribunal, agency or entity.

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         "GST" means the tax imposed by the Goods and Services Tax Act.

         "HARDWARE" means all physical items of the Equipment, including any
         hardware, equipment and firmware, and any operating system which is
         installed on such items of Equipment.

         "INDEPENDENT CERTIFIER" means the independent certifier appointed by
         the Commonwealth and Telstra under the Commonwealth Agreement for the
         purpose of certifying the delivery of technology solutions by Telstra
         under the Commonwealth Agreement.

         "INDEPENDENT EXPERT" means:

         (a)      a person who is appropriately qualified to decide a dispute of
                  a technical nature agreed by the parties; and

         (b)      if the parties cannot agree, a person nominated by the
                  President of the Institute of Arbitrators and Mediators
                  Australia (Victorian Chapter).

         "INITIAL REPORT" has the meaning given in clause 8(a)(i).

         "INITIAL TERM" means the period specified in item 2 of Schedule 1.

         "INSOLVENCY EVENT" means the happening of any of these events:

         (a)      an application is made to a court for an order or an order is
                  made that a body corporate be wound up;

         (b)      an application is made to a court for an order appointing a
                  liquidator or provisional liquidator in respect of a body
                  corporate, or one of them is appointed, whether or not under
                  an order;

         (c)      except to reconstruct or amalgamate while solvent, a body
                  corporate enters into, or revolves to enter into, a scheme of
                  arrangement, deed of company arrangement or composition with,
                  or assignment for the benefit of, all or any class of its
                  creditors, or it proposes a reorganisation, moratorium or
                  other administration involving any of them;

         (d)      a body corporate resolves to wind itself up, or otherwise
                  dissolve itself, or gives notice of intention to do so, except
                  to reconstruct or amalgamate while solvent or is otherwise
                  wound up or dissolved;

         (e)      a body corporate is or states that it is insolvent;

         (f)      as a result of the operation of section 459F(1) of the
                  Corporations Law, a body corporate is taken to have failed to
                  comply with a statutory demand;

         (g)      a body corporate is or makes a statement from which it may be
                  reasonably deduced by a party that the body corporate is the
                  subject of an event described in section 459C(2)(b) or section
                  585 of the Corporations Law;

                                                                              15

<PAGE>

         (h)      a body corporate takes any step to obtain protection or is
                  granted protection from its creditors, under any applicable
                  legislation or an administrator is appointed to a body
                  corporate;

         (i)      a person becomes an insolvent under administration as defined
                  in section 9 of the Corporations Law or action is taken which
                  could result in that event; or

         (j)      anything analogous or having a substantially similar effect to
                  any of the events specified above happens under the law of any
                  applicable jurisdiction.

         "INSURANCE POLICIES" means the insurance policies referred to in
         clauses 33.1 and 33.2.

         "INTEGRATION AND CONNECTION KITS" means the items of Equipment
         identified in Schedule 2 with the Lucent codes 800, 803, 804 and 806.

         "INTELLECTUAL PROPERTY RIGHTS" means all rights conferred by statute,
         common law or equity in or in relation to:

         (a)      inventions, tools, discoveries and novel designs, whether or
                  not registered or registrable as patents or designs, including
                  developments or improvements of equipment, circuit layouts,
                  products, technology, processes, methods or techniques;

         (b)      copyright (including future copyright) throughout the world in
                  all literary works, artistic works, computer software, and any
                  other works or subject matter in which copyright subsists and
                  may in the future subsist;

         (c)      confidential information and trade secrets; and

         (d)      trade and service marks (whether registered or unregistered).

         "IP MATERIAL" has the meaning given in clause 23.8.

         "KPIs" means the key performance indicators set out in column 2 of
         Schedule 8.

         "KPI REPORTS" has the meaning given in clause 14.2(a).

         "LAW" includes rules of common law, principles of equity, statutes,
         regulations, proclamations, ordinances, by-laws, rules, regulatory
         principles and requirements, mandatory codes of conduct, writs, orders,
         injunctions and judgments.

         "LEAD TIME" means the time specified in item 8 of Schedule 1,
         commencing from the date on which a Purchase Order is received by
         Lucent.

         "LOADING" means that:

         (a)      the items of Equipment the subject of a Purchase Order are
                  ready for collection by the Carrier; and

         (b)      in the case of any System the subject of a Purchase Order, the
                  System is ready for collection by the Carrier.

                                                                              16

<PAGE>

         "LUCENT CAPACITY" means the capacity detailed in Schedule 3.

         "LUCENT CONTRACT ADMINISTRATOR" means the person specified in item 5 of
         Schedule 1, or his or her replacement as notified in writing from time
         to time by Lucent to Telstra.

         "LUCENT DELEGATE" means the person specified in item 15 of Schedule 1,
         or his or her replacement as notified in writing from time to time by
         Lucent to Telstra.

         "LUCENT INTELLECTUAL PROPERTY" means any Intellectual Property Rights
         of Lucent or its subcontractors, whether existing as at the
         Commencement Date, or created thereafter, in or in relation to
         Material, the items of Equipment and Systems, the exercise of which is
         necessary for Contract Purposes.

         "LUCENT PURCHASING OFFICER" means the person specified in item 17 of
         Schedule 1, or his or her replacement as notified in writing from time
         to time by Lucent to Telstra.

         "MATERIAL" means material in any form, including Documentation,
         reports, products, equipment, information, Hardware, data, Software,
         software tools and software development methodologies.

         "MONTHLY REPORT" has the meaning given in clause 8.

         "NDC" means Network Design and Construction Limited ABN 64 086 174 781.

         "NEW EQUIPMENT" means:

         (a)      any functionality not included in the Specification and not
                  described as a new release of the Equipment or, subject to
                  paragraph (c) of this definition, proposed as an improvement
                  of the Equipment by Lucent;

         (b)      any new item of equipment ordered by Telstra under this
                  Agreement that is not specified in Schedule 2 as at the
                  Commencement Date; and

         (c)      modifications and enhancements to items of Equipment provided
                  under this Agreement including those specified in column 1 of
                  Schedule 14.

         "NEW TAX SYSTEM CHANGES" has the same meaning as in the A New Tax
         System (Trade Practices Amendment) Act 1999 (Cth).

         "NO DEFECT FOUND" means an item of Equipment returned to Lucent in
         accordance with clause 16.6 which Lucent has tested and found, as a
         result of that testing, to have no Defect.

         "NOTICE" has the meaning given in clause 35.1.

         "ORDERING AUTHORITY" means any one or more of the persons specified in
         item 4 of Schedule 1, or any other person notified in writing from time
         to time by Telstra to Lucent.

         "ORDERING PERIOD" has the meaning given in clause 3.4(a).

                                                                              17

<PAGE>

         "PERFORMANCE INDICATOR RIGHTS" means the rights set out in column 3 of
         Schedule 8.

         "PERIOD" has the meaning given in clause 13(c).

         "PROGRAM" means a computer program (as defined in the Copyright Act
         1968 (Cth)) in any material form (including firmware or any computer
         programs embodied in integrated circuits or other computer chips)
         together with all associated manuals and documentation.

         "PSTN" means the Public Switched Telephone Network.

         "PURCHASE ORDER" means an order Telstra places with Lucent under this
         Agreement for the supply of an item of Equipment.

         "RECIPIENT" means the party which receives or is given access to
         Confidential Information from or by the other party.

         "RECIPIENT CREATED TAX INVOICE" has the same meaning as in the Goods
         and Services Tax Act.

         "REMEDIAL PLAN" has the meaning given in clause 14(c)(i).

         "REPLACEMENT ITEM" has the meaning given in clause 16.6.

         "REPLACEMENT TURNAROUND TIME" means:

         (a)      in relation to a Design Defect, the period specified in item
                  11 of Schedule 1; and

         (b)      in relation to a Defect, the period specified in item 12 of
                  Schedule 1.

         "REVIEW DATE" has the meaning given in clause 17.4.

         "SCHEDULE" means a Schedule to the General Terms and Conditions, but
         does not include the General Terms and Conditions.

         "SITE" means a location specified in Schedule 4, or such other location
         agreed by the parties.

         "SOFTWARE" means any software or Program in any material form embedded
         in any application specific integrated circuit or other electronic
         components of the Hardware.

         "SPARES" means the items of Equipment listed under the heading "Product
         Description" as "Spares" in Schedule 2.

         "SPECIFICATIONS" means any document, specification or standard
         specified and included in Schedule 6 which sets out the technical,
         functional, environmental or other requirements or conditions relating
         to any item of Equipment and/or System (as the case may be) or any
         addition or variation to the Specifications agreed in writing by the
         parties pursuant to a Variation Form.

                                                                              18

<PAGE>

         "STANDARD ZONE" has the meaning given in the Telecommunications Act
         1997 (Cth).

         "SUBSEQUENT TERM" means, if clause 2.2 applies, the period of 12 months
         commencing on the day after the date the Initial Term expires.

         "SWING NETWORK MANAGER" means the items of Equipment listed under the
         heading "Product Description" as "Station, SNM" in Schedule 2.

         "SWING" means Subscriber Wireless Integrated Network Gateway.

         "SYSTEM" means a telecommunications transmission system comprising some
         of the items of Equipment (but excluding civil infrastructure including
         air-conditioning, shelters and power).

         "TAX INVOICE" means a document that complies with the requirements
         relating to Tax Invoices set out in the Goods and Services Tax Act and
         any regulations made in relation thereto.

         "TAXES" means taxes, duties or charges other than GST, or any tax on
         Telstra's income.

         "TELSTRA CONTRACT ADMINISTRATOR" means the person specified in item 3
         of Schedule 1, or his or her replacement as notified in writing from
         time to time by Telstra to Lucent.

         "TELSTRA DELAY" means:

         (a)      an actual or impending delay by Telstra in the performance of
                  its obligations under this Agreement, or the suspension or
                  cancellation by Telstra of access to Telstra's premises,
                  equipment or resources, or a failure by Telstra to perform its
                  obligations under this Agreement; or

         (b)      a delay caused by any activity that falls within clause
                  11.10(a).

         "TELSTRA DELEGATE" means the person specified in item 14 of Schedule 1,
         or his or her replacement as notified in writing from time to time by
         Telstra to Lucent.

         "TELSTRA INVOICE MANAGER" means the person specified in item 13 of
         Schedule 1, or his or her replacement as notified in writing from time
         to time by Telstra to Lucent.

         "TELSTRA SITE CONTACT" means the person specified in item 9 of Schedule
         1, or his or her replacement as notified in writing from time to time
         by Telstra to Lucent.

         "TERRITORY" means Australia.

         "TEST PERIOD" has the meaning given in clause 11.2(a)(i).

         "THIRD PARTY CLAIM" has the meaning given in clause 23.5.

         "TYPE APPROVAL" has the meaning given in clause 9.7.

         "VARIATION FORM" means the document in the form set out in Schedule 12.

                                                                              19

<PAGE>

         "WARRANTY PERIOD":

         (a)      in relation to an item of Equipment, means 12 months
                  commencing from the Date for Loading for that item of
                  Equipment;

         (b)      in relation to a Replacement Item, means 12 months commencing
                  from the day that Replacement Item is made available to
                  Telstra in accordance with clause 16; and

         (c)      in relation to an item of New Equipment, means 12 months
                  commencing from:

                  (i)      the Date for Loading for that item of New Equipment;
                           or

                  (ii)     in relation to an item of New Equipment specified in
                           column 1 of Schedule 14, the day that item of New
                           Equipment is made available by Lucent for collection
                           by or on behalf of Telstra.

         "WBP" means world's best practice regarding process, procedures, cost,
         performance and time to market.

         "WBV" means world's best value regarding price, performance and time to
         market.

         "WOOD-CRATE PACKING" means the packing of a System in accordance with
         item 10 of Schedule 7.

         "YEAR 2000 COMPLIANT" means in respect of a System, any item of
         Equipment or Material, that:

         (a)      the System, item of Equipment or Material can correctly
                  process Year 2000 dates, dates pre, trans and post year 2000,
                  and dates ending in 99, 00, or 01 (and that Lucent can provide
                  test cases, and both expected and actual results, to prove
                  this);

         (b)      the System, item of Equipment or Material correctly processes
                  Year 2000 as a leap year;

         (c)      the System, item of Equipment or Material continues to
                  properly operate and function pre, trans and post Year 2000;

         (d)      the System, item of Equipment or Material will not be
                  adversely affected by the date transition to Year 2000;

         (e)      the System, item of Equipment or Material continues to be
                  compatible with any other product or material which Lucent
                  supplies or has supplied to Telstra; and

         (f)      when required by Telstra, the System, item of Equipment or
                  Material has been tested in accordance with Telstra's generic
                  Year 2000 compliance documentation suite (documents YN03,
                  YN04, YN05, YN06 and YN07) and

                                                                              20

<PAGE>

                  test results have been recorded and stored and will be made
                  available to Telstra upon request.

1.2      INTERPRETATION

         In this Agreement and any Contract, unless the contrary intention
         appears:

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

         (b)      a reference to this Agreement, a Contract, an agreement or
                  other instrument, includes any variation or replacement of any
                  of them;

         (c)      a reference to:

                  (i)      a clause is a reference to a clause of the General
                           Terms and Conditions;

                  (ii)     a table, Schedule, attachment or appendix is a
                           reference to a table of, or Schedule, attachment or
                           appendix to, the General Terms and Conditions; and

                  (iii)    an item is a reference to an item of a Schedule;

         (d)      a reference to any handbook, Documentation or document is a
                  reference to the latest agreed version of that handbook,
                  Documentation or document;

         (e)      a reference to a person includes a reference to a natural
                  person, a partnership, a firm, a body corporate, a joint
                  venture, an unincorporated association or an authority as well
                  as a reference to the person's, executors, administrators,
                  successors, substitutes (including, without limitation,
                  persons taking by novation) and permitted assigns;

         (f)      a reference to a position, body, or authority of or within
                  Telstra includes:

                  (i)      a reference to any position, body or authority which
                           replaces; or

                  (ii)     supersedes it or takes over its duties;

         (g)      no provision of this Agreement will be construed adversely to
                  a party solely on the ground that the party drafted this
                  Agreement or any clause or Schedule of it;

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

         (i)      a reference to an agreement other than this Agreement includes
                  an undertaking, agreement or legally enforceable arrangement
                  or understanding whether or not in writing;

                                                                              21

<PAGE>

         (j)      where a term or condition of this Agreement or any Contract
                  applies to or refers to two or more persons, it will be
                  construed as applying to all of those persons jointly and each
                  of them severally;

         (k)      a reference to a "related body corporate" of a body corporate
                  is to a body corporate which is related to that body corporate
                  within the meaning of section 50 of the Corporations Law;

         (l)      a right or power of Telstra or Lucent under this Agreement or
                  any Contract may be exercised on behalf of Telstra or Lucent
                  respectively by the Telstra Contract Administrator and the
                  Lucent Contract Administrator respectively, their delegates or
                  any person authorised by them to do so;

         (m)      headings, bolding, and italics are inserted for convenience
                  and do not affect interpretation;

         (n)      a reference to any gender includes all genders;

         (o)      a reference to an accounting term is to be interpreted in
                  accordance with accounting standards under the Corporations
                  Law, Schedule 5 to the Corporations Regulations, and, when not
                  inconsistent with those accounting standards or that Schedule,
                  generally accepted accounting principles and practices applied
                  from time to time in Australia;

         (p)      if a period of time is specified and the period dates from the
                  given day or the day of an act or event, it is to be
                  calculated exclusive of that day;

         (q)      a reference to a month is a reference to a calendar month;

         (r)      a reference to a quarter is a reference to any consecutive 3
                  month period;

         (s)      where a word or phrase is specifically defined other parts of
                  speech or grammatical forms of that word or phrase have a
                  corresponding meaning;

         (t)      a reference to a thing (including any amount) is a reference
                  to the whole and each part of it;

         (u)      the expressions "taxable supply", "GST free supply" and "input
                  taxed supply" have the same meanings as in the Goods and
                  Services Tax Act;

         (v)      if an example is given of any thing (including a right,
                  obligation or concept), such as by saying it includes
                  something else, the example does not limit the scope of that
                  thing; and

         (w)      a reference to "$" is a reference to Australian dollars.

1.3      INCONSISTENCY BETWEEN DOCUMENTS COMPRISING AGREEMENT

         (a)      If there is an inconsistency between:

                  (i)      the General Terms and Conditions;

                                                                              22

<PAGE>

                  (ii)     a Schedule; and

                  (iii)    a document expressly incorporated by reference in:

                           (A)      the General Terms and Conditions; or

                           (B)      a Schedule,

                  the order of precedence between them will be the order listed
                  above.

         (b)      Subject to clause 5.9(b), if there is an inconsistency
                  between:

                  (i)      this Agreement;

                  (ii)     any Contract formed under this Agreement; and

                  (iii)    any Purchase Order issued under this Agreement,

                  the order of precedence between them will be the order listed
                  above.

2.       TERM OF AGREEMENT

2.1      COMMENCEMENT AND EXPIRY

         This Agreement commences on the Commencement Date and continues in
         force for the Initial Term, unless terminated earlier in accordance
         with this Agreement or at Law, or extended under clause 2.2.

2.2      RENEWAL

         Telstra may, by giving at least 6 months' notice in writing to Lucent
         before the expiry of the Initial Term, extend the term of this
         Agreement for a Subsequent Term on the same terms and conditions
         contained in this Agreement.

2.3      CONSIDERATION

         In consideration of receiving $10 from Telstra, Lucent agrees to
         provide the items of Equipment to Telstra pursuant to Contracts on the
         terms and conditions set out in this Agreement.

2.4      ORDERS PRIOR TO COMMENCEMENT

         Purchase orders placed prior to execution of this Agreement as
         specifically set out in Schedule 13 have been accepted by Lucent and
         are deemed to have been given under this Agreement and subject to all
         of its terms and conditions.

2.5      PERIODIC REVIEW

         Either the Telstra Contract Administrator or the Lucent Contract
         Administrator, as the case may be, may from time to time, but no more
         frequently than once a month, request a meeting of the parties by
         giving 2 Business Days' notice to the other party to

                                                                              23

<PAGE>

         discuss and review the manner and extent to which Lucent and Telstra
         are complying with their respective obligations under this Agreement
         and any Contract.

2.6      QUARTERLY REVIEW

         Commencing from the anniversary of the Commencement Date the Telstra
         Contract Administrator and the Lucent Contract Administrator must meet
         each quarter to discuss (among other things):

         (a)      the performance of Lucent and Telstra under this Agreement;

         (b)      the performance of Lucent under any Contract;

         (c)      the testing regime set out in this Agreement;

         (d)      pricing under this Agreement; and

         (e)      forecasting,

         for the purpose of (among other things) determining whether or not a
         variation to this Agreement is required.

2.7      ENHANCED ORDERING PROCESS

         Without limiting clause 2.5, Lucent must negotiate with Telstra in good
         faith with a view to further streamlining the ordering and delivery
         processes under this Agreement. These negotiations must address,
         without limitation, the following subject areas:

         (a)      development of an enhanced EDI ordering and invoice system;

         (b)      Lucent stock holdings for materials and equipment; and

         (c)      alternative delivery locations.

3.       RESPONSIBILITIES OF THE PARTIES

3.1      APPOINTMENT OF LUCENT

         Telstra appoints Lucent, and Lucent accepts the appointment, as a
         non-exclusive supplier of the items of Equipment.

3.2      ROLE OF LUCENT

         Lucent must:

         (a)      supply the items of Equipment to Telstra free from
                  encumbrances and otherwise in accordance with the relevant
                  Contract and this Agreement;

                                                                              24

<PAGE>

         (b)      ensure that the items of Equipment comply with all relevant
                  Australian Laws and Australian Standards or, where no
                  Australian Standards are applicable, all relevant Australian
                  industry standards;

         (c)      cooperate with Telstra to manage the ordering and forecasting
                  procedures specified in this Agreement;

         (d)      ensure it makes ready for Loading the items of Equipment that
                  are the subject of a Purchase Order by the relevant Date for
                  Loading and otherwise ensures that those items of Equipment
                  meet the requirements of the relevant Contract and this
                  Agreement; and

         (e)      notify Telstra as to the likely obsolescence of any item of
                  Equipment the subject of a Forecast, prior to receiving any
                  Purchase Order under clause 5, and, where possible, recommend
                  to Telstra alternative items of equipment.

3.3      EDI

         Lucent and Telstra will conduct ordering, invoicing and payment under
         this Agreement in accordance with the EDI Trading Agreement once the
         EDI Trading Agreement is executed by the parties.

3.4      TELSTRA'S COMMITMENT AND DISCOUNT

         (a)      Lucent agrees that Telstra is entitled to a 10% discount on
                  the Contract Price for all items of Equipment (with the
                  exception of those items of Equipment identified in Schedule 2
                  with the Lucent code numbers 400 and 401) that are the subject
                  of Purchase Orders, subject to Telstra issuing Purchase Orders
                  which have a Date for Loading that falls before or on 30
                  September 2002 ("ORDERING PERIOD") for a total value of $42
                  million (such value being inclusive of the value of purchase
                  orders the subject of clause 2.4, and also inclusive of the
                  value of Purchase Orders issued by NDC in accordance with the
                  Deed of Novation and Assumption).

         (b)      If Telstra does not issue Purchase Orders which have a Date
                  for Loading that falls within the Ordering Period for a total
                  value of $42 million (such value being inclusive of the value
                  of purchase orders the subject of clause 2.4, and also
                  inclusive of the value of Purchase Orders issued by NDC in
                  accordance with the Deed of Novation and Assumption) Telstra
                  will pay to Lucent at the end of the Ordering Period a sum
                  representing the difference between:

                  (i)      the amount that would have been payable had the 10%
                           discount not applied (that is, the Contract Price);
                           and

                  (ii)     the actual amount paid by Telstra (that is, the
                           Contract Price less 10% of that Contract Price),

                  for each item of Equipment the subject of a Purchase Order
                  issued by Telstra which has a Date for Loading that falls
                  within the Ordering Period (including

                                                                              25

<PAGE>

                  each item of Equipment the subject of a purchase order that
                  falls within clause 2.4).

         (c)      If Telstra issues Purchase Orders which have a Date for
                  Loading that falls within the Ordering Period for a total
                  value of $42 million (such value being inclusive of the value
                  of the purchase orders the subject of clause 2.4, and also
                  inclusive of the value of Purchase Orders issued by NDC in
                  accordance with the Deed of Novation and Assumption), Telstra
                  will, in respect of any additional item of Equipment the
                  subject of a Purchase Order received by Lucent from Telstra
                  under this Agreement, or issued by NDC in accordance with the
                  Deed of Novation and Assumption, for the remainder of the term
                  of this Agreement, pay an amount representing the Contract
                  Price less 10% of that Contract Price for that item of
                  Equipment.

4.       FORECASTING

4.1      TELSTRA TO GIVE FORECASTS

         (a)      Telstra will use reasonable efforts:

                  (i)      within 1 week of the Commencement Date; and

                  (ii)     by the last day of each month during the remainder of
                           the term of this Agreement,

                  (each date being a "FORECAST DATE") to give to Lucent a no
                  obligation forecast ("FORECAST") estimating either:

                           (A)      the number of Systems likely to be required
                                    by Telstra; and

                           (B)      the likely quantity of items of Equipment
                                    that is to comprise each System referred to
                                    in clause 4.1(a)(ii)(A); and

                           (C)      using the form set out in item 7 of Schedule
                                    1, the likely frequency bands for each item
                                    of Equipment referred to in clause
                                    4.1(a)(ii)(B); or

                           (D)      the number of items of Equipment likely to
                                    be required by Telstra; and

                           (E)      using the form set out in item 7 of Schedule
                                    1, the likely frequency bands for each item
                                    of Equipment referred to in clause
                                    4.1(a)(ii)(D);

                           in the 6 month period commencing after the Forecast
                           Date.

         (b)      Each Forecast given under clause 4.1(a) must exclude Systems
                  the subject of a Contract.

         (c)      As soon as Telstra becomes aware of any material inaccuracy in
                  a Forecast, Telstra will, within a reasonable time of becoming
                  aware of that material

                                                                              26

<PAGE>

                  inaccuracy but in any case no later than the next Forecast
                  issued by Telstra under this clause 4.1, update and correct
                  that material inaccuracy.

4.2      FORECASTS NOT BINDING ON TELSTRA

         While Forecasts will be made by Telstra in good faith, and will
         constitute Telstra's best estimate at that time of its likely
         requirements, Lucent acknowledges that Forecasts are given for general
         guidance only, do not oblige Telstra to purchase the items of Equipment
         forecast and do not constitute a representation of the items of
         Equipment which will be required by Telstra.

4.3      NO RELIANCE

         Without limiting clause 4.2, Lucent agrees it will not place any
         reliance upon Forecasts given by Telstra to Lucent under clause 4.1.

4.4      NO OBLIGATION

         Nothing in this Agreement, including without limitation the content of
         any Forecast, obliges Telstra to place any Purchase Order or order or
         purchase any item of Equipment from Lucent other than pursuant to
         purchase orders referred to in clause 2.4, or any Contract.

4.5      MINIMISATION OF STOCK

         The parties will negotiate in good faith to jointly develop an ordering
         profile designed to minimise the stock of Equipment held by Lucent on
         the expiry of this Agreement.

5.       ORDERING AND FORMATION OF CONTRACTS

5.1      PURCHASE ORDERS

         (a)      A Purchase Order and a completed Design Information Sheet is
                  required to order any item of Equipment under this Agreement.

         (b)      If Telstra places Purchase Orders with Lucent, it must do so
                  in accordance with and subject to this Agreement.

         (c)      Where a Purchase Order and a completed Design Information
                  Sheet is not submitted by Telstra pursuant to the EDI Trading
                  Agreement, the Ordering Authority must submit the Purchase
                  Order and the completed Design Information Sheet to the Lucent
                  Purchasing Officer.

5.2      REQUIREMENTS FOR PURCHASE ORDERS

         A Purchase Order must specify:

         (a)      the reference number of this Agreement;

         (b)      the Purchase Order number;

                                                                              27

<PAGE>

         (c)      a description of each item of Equipment ordered, including the
                  item number;

         (d)      the quantity of each item of Equipment;

         (e)      no more than one System (if any);

         (f)      at the discretion of Telstra, whether the System (if any)
                  requires Wood-Crate Packing;

         (g)      at the discretion of Telstra, the number of Integration and
                  Connection Kits;

         (h)      at the discretion of Telstra, the number of Spares;

         (i)      the place where the items of Equipment are to be installed by
                  or on behalf of Telstra, and the arrangements for the
                  collection by the Carrier of those items of Equipment from
                  Lucent on the Date for Loading;

         (j)      the Date for Loading;

         (k)      the Contract Price; and

         (l)      the invoice address.

5.3      ORDERING AUTHORITY

         A Purchase Order may only be given to Lucent by an Ordering Authority
         and Lucent agrees only to accept and act on Purchase Orders given by an
         Ordering Authority.

5.4      LEAD TIME

         The Ordering Authority must not specify a Date for Loading in any
         Purchase Order within a period less than the Lead Time, unless
         otherwise agreed in writing by Lucent.

5.5      QUANTITY OF EQUIPMENT THAT HAS BEEN FORECAST BUT EXCEEDING LUCENT
         CAPACITY

         If a Purchase Order specifies a quantity of Equipment and/or number of
         Systems that exceeds the Lucent Capacity but which has been Forecast
         Lucent must:

         (a)      for that quantity of Equipment and/or number of Systems that
                  meets the Lucent Capacity, make that quantity of Equipment
                  and/or number of Systems ready for Loading by the Date for
                  Loading specified in that Purchase Order;

         (b)      for that quantity of Equipment and/or number of Systems that
                  exceeds the Lucent Capacity by an amount of up to or equal to
                  50% of the Lucent Capacity, make that quantity of Equipment
                  and/or number of Systems ready for Loading:

                  (i)      by the Date for Loading specified in the Purchase
                           Order subject to the parties (acting reasonably)
                           agreeing a variation to the testing regime

                                                                              28

<PAGE>

                           specified in Schedule 5 for that quantity of
                           Equipment and/or number of Systems; or

                  (ii)     if no agreement is reached under clause 5.5(b)(i), on
                           a date to be agreed by the parties (acting
                           reasonably); and

         (c)      for that quantity of Equipment and/or number of Systems that
                  exceeds the Lucent Capacity by an amount greater than 50% of
                  the Lucent Capacity, make that quantity of Equipment and/or
                  number of Systems ready for Loading on a date to be agreed by
                  the parties (acting reasonably).

5.6      QUANTITY OF EQUIPMENT EXCEEDING FORECAST AND LUCENT CAPACITY

         If a Purchase Order specifies a quantity of Equipment and/or number of
         Systems which exceeds the Forecast quantity and the Lucent Capacity
         Lucent must:

         (a)      for that quantity of Equipment and/or number of Systems that
                  meets the Forecast quantity, make that quantity of Equipment
                  and/or number of Systems ready for Loading by the Date for
                  Loading specified in that Purchase Order;

         (b)      for that quantity of Equipment and/or number of Systems that
                  exceeds the Forecast quantity by an amount of up to or equal
                  to 50% of the Forecast quantity, make that quantity of
                  Equipment and/or number of Systems ready for Loading:

                  (i)      by the Date for Loading specified in that Purchase
                           Order subject to the parties (acting reasonably)
                           agreeing a variation to the testing regime specified
                           in Schedule 5 for that quantity of Equipment and/or
                           number of Systems; or

                  (ii)     if no agreement is reached under clause 5.6(b)(i), on
                           a date to be agreed by the parties (acting
                           reasonably); and

         (c)      for that quantity of Equipment and/or number of Systems that
                  exceeds the Forecast quantity by an amount greater than 50% of
                  the Forecast quantity, make that quantity of Equipment and/or
                  number of Systems ready for Loading on a date to be agreed by
                  the parties (acting reasonably).

5.7      DESIGN INFORMATION SHEET

         If Lucent (acting reasonably) disagrees with the content of a Design
         Information Sheet submitted by Telstra with a Purchase Order in
         accordance with clause 5.1, Lucent must provide its reasons to the
         Ordering Authority. Upon receiving those reasons, Telstra and Lucent
         must meet for the purpose of agreeing the content of the Design
         Information Sheet. Notwithstanding any other clause of this Agreement,
         any dispute arising in relation to the content of a Design Information
         Sheet must be decided in accordance with clauses 28.3(a) to (c)
         inclusive.

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<PAGE>

5.8      REQUEST FOR FREQUENCIES

         Within 5 Business Days after the receipt of a Purchase Order Lucent
         must notify Telstra specifying a date (being a date that falls within
         the 6 week period prior to the relevant Date for Loading) by which
         Telstra must notify Lucent of the frequency bands for the relevant
         items of Equipment.

5.9      FORMATION OF CONTRACT AND CONSISTENCY

         (a)      Each Purchase Order issued by Telstra will, upon receipt by
                  Lucent, constitute a separate binding contract between Telstra
                  and Lucent for the supply and delivery of the items of
                  Equipment specified in the Purchase Order on the terms and
                  conditions of:

                  (i)      this Agreement;

                  (ii)     the Purchase Order; and

                  (iii)    any other documents expressly incorporated in the
                           Purchase Order by reference,

                  ("CONTRACT").

         (b)      The terms of a Contract must not be inconsistent with the
                  terms of this Agreement unless otherwise agreed in writing by
                  the Telstra Contract Administrator and the Lucent Contract
                  Administrator. If there is an inconsistency which is not
                  agreed in writing by the Telstra Contract Administrator and
                  the Lucent Contract Administrator, this Agreement prevails.

5.10     RIGHT OF TELSTRA TO CANCEL A PURCHASE ORDER

         Telstra reserves the right to cancel a Purchase Order at any time
         without penalty if Lucent fails to comply with its obligations with
         respect to that Purchase Order 20 Business Days after the relevant Date
         for Loading.

5.11     CARRIER ARRANGEMENTS

         At least 2 Business Days prior to the Date for Loading for items of
         Equipment the subject of a Purchase Order, Lucent must:

         (a)      contact the Carrier to confirm the appropriate collection
                  arrangements for the those items of Equipment;

         (b)      provide the Carrier with the necessary details, including
                  pickup location, delivery location, dimensions, weight,
                  packing (on pallets) and any other details reasonably
                  requested by the Carrier; and

         (c)      inform Telstra in writing of the arrangements Lucent agrees
                  with the Carrier under this clause 5.10.

                                                                              30

<PAGE>

 5.12    TEMPORARY STORAGE AND RISK FOR TELSTRA

         (a)      Telstra may, at any time after the receipt by Lucent of a
                  Purchase Order under this clause 5 but no less than 5 Business
                  Days prior to the applicable Date for Loading, by notice in
                  writing to Lucent, notify Lucent that Telstra wishes Lucent to
                  store some or all of the items of Equipment the subject of
                  that Purchase Order by such period as Telstra (acting
                  reasonably) considers necessary, provided that such period
                  must be no more than 1 month from the applicable Date for
                  Loading.

         (b)      Within 2 Business Day of receiving a notice from Telstra under
                  clause 5.11(a), Lucent must notify Telstra in writing whether
                  it agrees to store the relevant items of Equipment.

         (c)      Any storage of items of Equipment under this clause 5.11 will
                  be at no cost to Telstra.

         (d)      If at the end of any storage period agreed under this clause
                  5.11 Telstra has not collected the relevant items of Equipment
                  Lucent must:

                  (i)      notify Telstra of Lucent's requirements for the
                           collection of those items of Equipment; and

                  (ii)     continue to store those items of Equipment until
                           Telstra or its Carrier collects those items of
                           Equipment.

                  Telstra must pay for any reasonable costs incurred by Lucent
                  in storing items of Equipment pursuant to this clause 5.11(d).

         (e)      Telstra acknowledges it bears the risk of any item of
                  Equipment stored by Lucent in accordance with this clause 5.11
                  and, accordingly, Telstra is responsible for the insurance
                  arrangements with respect to that item of Equipment.

         (f)      For the avoidance of doubt, nothing in this clause 5.11
                  affects clause 15.

5.13     PACKING AND LABELLING

         (a)      Lucent must comply with the requirements relating to packing,
                  marking and labelling of the items of Equipment as specified
                  in Schedule 7.

         (b)      Lucent must ensure that the items of Equipment are packed for
                  road freight transportation.

6.       AUSTRALIAN CONTENT

6.1      LEVEL OF AUSTRALIAN CONTENT

         (a)      The Australian Content of the items of Equipment is set out in
                  item 10 of Schedule 1.

                                                                              31

<PAGE>

         (b)      Lucent must, upon request by Telstra, provide to Telstra
                  within 20 Business Days of receiving that request, a detailed
                  timetable for maximising the Australian Content of the items
                  of Equipment.

         (c)      Lucent must as soon as possible advise Telstra of any changes
                  to the Australian Content of any item of Equipment.

6.2      AUSTRALIAN CONTENT

         The Australian Content of an item of Equipment is calculated in
         accordance with the following formula:

                          C
                  AC=(1- ---)x100
                         P-T

         where:

         AC   =   the Australian Content of an item of Equipment, expressed as
                  a percentage;

         C    =   the cost to Lucent of the components of that item of
                  Equipment which are imported, including landing charges,
                  customs duty and delivery into Australia, but excluding GST
                  applicable to those components;

         P    =   the total Contract Price of that item of Equipment including
                  associated customs duty and GST; and

         T    =   the GST applicable to the Contract Price of that item of
                  Equipment.

7.       EMPLOYEES

         If any employee, contractor, representative or agent of Lucent does not
         perform work in relation to this Agreement or any Contract to the
         reasonable satisfaction of Telstra, or engages in conduct which Telstra
         regards as unsatisfactory, Telstra may, acting reasonably and after
         consultation with Lucent, request Lucent to replace that employee,
         contractor, representative or agent or take other steps in relation to
         that employee, contractor, representative or agent, and Lucent must use
         its reasonable endeavours to comply with that request.

8.       REPORTS

         (a)      In relation to each Purchase Order, Lucent must submit to
                  Telstra:

                  (i)      an initial progress report within 1 month of the date
                           on which the Purchase Order was received by Lucent
                           under clause 5 ("INITIAL REPORT"); and

                  (ii)     monthly progress reports within 5 Business Days after
                           the relevant month, until Lucent makes ready for
                           Loading all items of Equipment specified in the
                           Purchase Order ("MONTHLY REPORT").

                                                                              32

<PAGE>

         (b)      The Initial Report must show Lucent's programme of manufacture
                  and delivery to meet the Date for Loading.

         (c)      The Ordering Authority may, in its absolute discretion, advise
                  Lucent of its preferred priority of Date for Loading in any
                  response to the Initial Report. Where Telstra's preferred
                  priority of Date for Loading differs from that set out in the
                  relevant Contract, Lucent must use reasonable endeavours to
                  comply with that preferred priority. Telstra will be liable
                  for any additional costs reasonably incurred by Lucent in
                  complying with Telstra's preferred priority, which costs must
                  be the subject of a Variation Form that has been signed by the
                  parties.

         (d)      The Monthly Reports must contain details of:

                  (i)      any variations from the programme of manufacture and
                           delivery specified in the Initial Report; and

                  (ii)     any items of Equipment made ready for Loading in the
                           relevant month with reference to this Agreement
                           number, the Contract number, and the serial and item
                           numbers of the relevant Equipment.

9.       NEW EQUIPMENT

9.1      PROGRAMME FOR RELEASE

         Lucent must comply with the roadmap specified in Schedule 14 for the
         release of the items New Equipment identified in that Schedule.

9.2      APPROVAL

         All items of New Equipment must be given Type Approval by Telstra prior
         to incorporation into the Specification and inclusion into Schedule 2
         in accordance with a Variation Form that has been signed by the
         parties.

9.3      SPECIFICATION FOR NEW EQUIPMENT AND TESTING

         As soon as practicable after the development of an item of New
         Equipment, the parties must:

         (a)      develop and document a specification for that item of New
                  Equipment; and

         (b)      develop and document agreed test definitions, procedures,
                  acceptance criteria and other provisions relating to the
                  testing of that item of New Equipment.

9.4      LUCENT TO PROVIDE TEST FACILITIES

         Unless otherwise agreed by Telstra, Lucent must provide and make
         available, at its own cost, test facilities (including test models) and
         personnel necessary to conduct the tests agreed by the parties in
         accordance with clause 9.3. Telstra must provide and make available, at
         its own cost, Telstra equipment and personnel and any third party
         equipment and personnel necessary to conduct such tests.

                                                                              33

<PAGE>

9.5      SUPPLY OF SPECIFICATIONS

         Lucent must supply Telstra with the relevant technical and functional
         specifications, in a level of detail consistent with the technical and
         functional information contained in the Specification, for all New
         Equipment which must be incorporated into Schedule 2 from time to time
         in accordance with a Variation Form that has been signed by the
         parties.

9.6      STATEMENTS, PROOFS AND CERTIFICATES OF COMPLIANCE

         (a)      Unless Telstra notifies otherwise, Lucent must, at Telstra's
                  reasonable request, provide Telstra:

                  (i)      within a reasonable time, proof that the relevant
                           item of New Equipment complies with the specification
                           for such New Equipment. That proof must contain
                           actual measurements, test results or other evidence
                           which can conclusively prove that the relevant item
                           of New Equipment complies with the specification for
                           such New Equipment;

                  (ii)     with a copy of the certificate of compliance for each
                           item of New Equipment which requires certification by
                           any relevant statutory or similarly authorised body;
                           and

                  (iii)    with a copy of the certificate of compliance with any
                           applicable standards (including, without limitation,
                           Australian Standards) from appropriately accredited
                           test houses for any item of New Equipment.

         (b)      Unless otherwise agreed by Telstra, Lucent will be responsible
                  for the cost of:

                  (i)      proving each item of New Equipment complies with the
                           specification for that item of Equipment (as agreed
                           by the parties in accordance with clause 9.3(a)); and

                  (ii)     obtaining the certificates of compliance,

                  under this clause 9.6.

9.7      TYPE APPROVAL

         For the purposes of this clause 9, "TYPE APPROVAL" means the completion
         by Lucent of the procedure prescribed by clauses 9.3 to 9.6 inclusive
         with respect to an item of New Equipment.

10.      DOCUMENTATION

10.1     MANUFACTURER'S DOCUMENTATION

         (a)      Lucent must provide Telstra with the Documentation that is the
                  subject of a Purchase Order.

                                                                              34

<PAGE>

         (b)      The Documentation referred to in clause 10.1(a) must provide
                  sufficient detail for Telstra to install, commission, use,
                  operate and maintain the items of Equipment and/or Systems (as
                  the case may be) in accordance with the Specifications.

         (c)      Lucent:

                  (i)      grants to Telstra a perpetual, non-exclusive,
                           world-wide, non-transferable (except as provided
                           under clause 29) licence of its Intellectual Property
                           Rights in and to the Documentation referred to in
                           clause 10.1(a) for the purpose of using and
                           reproducing that Documentation; and

                  (ii)     will obtain from any third party a perpetual,
                           non-exclusive, non-transferable (except as provided
                           under clause 29) licence of the third party's
                           Intellectual Property Rights in and to the
                           Documentation referred to in clause 10.1(a) for the
                           purpose of using and reproducing that Documentation;
                           or

                  (iii)    will procure the third party referred to in clause
                           10.1(c)(ii) to grant a perpetual, world-wide,
                           non-exclusive, non-transferable (except as provided
                           under clause 29) licence to Telstra of the third
                           party's Intellectual Property Rights in and to the
                           Documentation referred to in clause 10.1(a) for the
                           purpose of using and reproducing that Documentation.

10.2     AMENDMENT OF SPECIFICATIONS

         The parties may from time to time amend the Specifications in
         accordance with clause 36.4.

10.3     NO RELIEF OF RESPONSIBILITY

         The participation of Telstra in developing, agreeing on and documenting
         test definitions, procedures, acceptance criteria and other provisions
         relating to the testing of any item of Equipment under this Agreement
         does not relieve Lucent from its responsibilities to ensure that all
         items of Equipment comply with the Specifications and all other
         requirements of this Agreement.

11.      TESTING

11.1     FUNCTIONAL SYSTEM TESTING

         Lucent must comply with the obligations and requirements specified in
         Schedule 5 to demonstrate the compliance of the items of Equipment with
         the requirements of this Agreement.

11.2     LUCENT TO INVITE TELSTRA TO WITNESS TESTING

         (a)      Lucent must:

                                                                              35

<PAGE>

                  (i)      give Telstra no less than 2 weeks' advance notice of,
                           and relevant information concerning, any proposed
                           test of any item of Equipment and/or System (as the
                           case may be) to be carried out by Lucent and the
                           timeframe within which such tests will take place
                           ("TEST PERIOD"); and

                  (ii)     ensure that Telstra is entitled to attend and witness
                           the carrying out of those tests during the Test
                           Period, and is given the results of, and all other
                           relevant information relating to, those tests as soon
                           as practicable after the completion of the tests.

         (b)      Telstra must advise Lucent no less than 3 Business Days prior
                  to the Test Period whether Telstra will be attending the tests
                  referred to in clause 11.2(a).

11.3     TELSTRA MAY WITNESS

         Telstra reserves the right to appoint an inspecting officer to witness
         the tests referred to in clauses 11.1 and 11.2. Telstra will meet all
         costs associated with such an inspecting officer witnessing the tests
         referred to in clauses 11.1 and 11.2. The inspecting officer has the
         right to reject any item of Equipment (or component of any item of
         Equipment) and/or System (as the case may be) which does not meet the
         requirements of this Agreement. Where a third person is appointed as an
         inspecting officer Telstra must obtain from that third person an
         undertaking in writing that they have read and understood clauses 24.1,
         24.2, 24.4 and 24.7 of this Agreement and must comply with those
         clauses (unless otherwise agreed by the parties).

11.4     TELSTRA NOT LIABLE TO PAY COSTS

         Telstra will not be liable to pay for any rejected item of Equipment or
         Lucent's costs arising from Telstra's inspection of any item of
         Equipment or rejection of any item of Equipment by reason of the
         failure of that item of Equipment to meet the requirements of this
         Agreement.

11.5     REMEDIES FOR REJECTED EQUIPMENT

         If Telstra rejects any item of Equipment and/or System (as the case may
         be) for not meeting the requirements of this Agreement, Lucent must at
         no cost to Telstra, in its sole discretion but without prejudice to
         Telstra's rights arising under this Agreement or at Law:

         (a)      replace the rejected item of Equipment with equipment of a
                  similar or better quality, design or make;

         (b)      replace the rejected System with a system of a similar or
                  better quality, design or make; or

         (c)      repair the item of Equipment and/or System (as the case may
                  be) to the reasonable satisfaction of Telstra.

                                                                              36

<PAGE>

11.6     LUCENT'S AND TELSTRA'S RESPONSIBILITIES

         (a)      Lucent must provide all labour, test instruments, incidental
                  material and other facilities necessary for the conducting and
                  recording of tests carried out on items of Equipment in
                  accordance with Schedule 5.

         (b)      Without limiting clause 11.6(a), Telstra must provide all
                  Telstra and third party labour, test instruments, incidental
                  material and other facilities that may be required by Lucent
                  (acting reasonably) for the purpose of testing the
                  compatibility of any item of Equipment with Telstra's
                  telecommunications network.

11.7     NO RELIEF OF RESPONSIBILITY

         Telstra's acceptance of any item of Equipment and/or System (as the
         case may be) does not relieve Lucent from its responsibility to:

         (a)      ensure that all items of Equipment and/or Systems (as the case
                  may be) comply with the Specifications; and

         (b)      comply with its other obligations under this Agreement.

11.8     TELSTRA MAY TEST

         Telstra reserves the right to independently test, at its own cost, any
         item of Equipment and/or System (as the case may be). Telstra
         acknowledges and agrees that where it exercises its right under this
         clause 11.8, unless otherwise agreed in writing by Lucent, the Date for
         Loading specified in the relevant Contract will be extended by at least
         the time taken for Telstra to independently test the item of Equipment
         and/or System (as the case may be).

11.9     COMPLIANCE WITH SPECIFICATIONS

         Lucent warrants that, as at the relevant Date for Loading, each item of
         Equipment supplied under this Agreement or any Contract complies with
         the Specification as it pertains to that item of Equipment.

11.10    INDEPENDENT CERTIFIER

         (a)      Lucent agrees, upon receiving reasonable notice from Telstra,
                  to provide Telstra with all reasonable assistance (including,
                  without limitation, permitting the Independent Certifier to
                  witness any testing of the items of Equipment) so that Telstra
                  is able to comply with its obligations under the Commonwealth
                  Agreement with respect to the Independent Certifier.

         (b)      Telstra will take reasonable steps, when requested by Lucent,
                  to ensure the Independent Certifier maintains the
                  confidentiality of any Confidential Information obtained by
                  the Independent Certifier.

                                                                              37

<PAGE>

12.      TELSTRA DELAY

12.1     BASIS FOR EXTENSION OF TIME

         If Lucent cannot, or reasonably anticipates that it cannot, meet a Date
         for Loading solely because of a Telstra Delay Lucent must notify the
         Telstra Contract Administrator in writing as soon as reasonably
         possible, given the nature of the Telstra Delay, upon Lucent becoming
         aware of that Telstra Delay, of the nature of the Telstra Delay.

12.2     APPLICATION ASSESSMENT FOR TELSTRA DELAY

         (a)      Telstra must extend the affected Date for Loading if:

                  (i)      there is a Telstra Delay; and

                  (ii)     Lucent has notified Telstra in accordance with clause
                           12.1.

         (b)      The extension referred to in clause 12.2(a) will:

                  (i)      commence from the next Business Day after the date of
                           the occurrence of the Telstra Delay; and

                  (ii)     end on the earlier of the date:

                           (A)      the Telstra Delay ceases; or

                           (B)      such other period agreed in writing between
                                    the parties.

12.3     NO RELIEF OF OBLIGATIONS

         Unless Lucent applies for an extension of time within the time and in
         the manner set out in this clause 12, Lucent will not be relieved in
         any way or to any extent from its obligations to meet the relevant Date
         for Loading.

13.      FORCE MAJEURE EVENT

         (a)      If Lucent becomes aware of the existence or possible existence
                  of a Force Majeure Event, Lucent must promptly notify Telstra
                  specifying:

                  (i)      in a reasonable level of detail, the nature of the
                           Force Majeure Event; and

                  (ii)     the likely effect on the ability of Lucent to perform
                           under this Agreement.

         (b)      Upon the occurrence of a Force Majeure Event, Lucent must:

                  (i)      use reasonable endeavours to recommence performance
                           of its obligations directly affected by the Force
                           Majeure Event by means of

                                                                              38

<PAGE>

                           an alternate source, work-around or implementation of
                           any other mitigation strategy;

                  (ii)     continue to perform those obligations that are not
                           directly affected by the Force Majeure Event; and

                  (iii)    provide Telstra with fortnightly progress reports
                           informing Telstra of the status of the Force Majeure
                           Event and the progress of Lucent in performing the
                           affected obligations.

         (c)      Subject to clause 13(d), if a Force Majeure Event continues
                  for more than 3 consecutive days or such other period as
                  agreed between the parties (the "PERIOD"), Lucent is entitled
                  to an extension of time for meeting the relevant Date for
                  Loading commencing from the end of the Period and, provided
                  Lucent complies with clause 13(b), continuing until the Force
                  Majeure Event ceases to affect the ability of Lucent to carry
                  out its obligations with respect to that Date for Loading (the
                  "EXTENSION OF TIME").

         (d)      Before being entitled to an Extension of Time, Lucent must:

                  (i)      establish that the Force Majeure Event is one that
                           was beyond the reasonable control of Lucent;

                  (ii)     establish that the Force Majeure Event could not have
                           been reasonably circumvented by Lucent by means of an
                           alternate source, work-around or implementation of
                           any other mitigation strategy; and

                  (iii)    satisfy Telstra that it has taken all reasonable
                           steps to redeploy resources to continue to perform
                           those obligations that are not directly affected by
                           the Force Majeure Event for the purpose of:

                           (A)      expediting the performance of those
                                    obligations; and

                           (B)      lessening the impact of the Force Majeure
                                    Event on the performance of its obligations
                                    under this Agreement.

         (e)      Where more than one event or circumstance affects the ability
                  of Lucent to meet a Date for Loading, and one of the events or
                  circumstances is a Force Majeure Event, Lucent is entitled to
                  an Extension of Time. However, the period of that Extension of
                  Time will commence from the end of the Period until the time
                  the Force Majeure Event ceases to affect the ability of Lucent
                  to meet those obligations under this Agreement directly
                  affected by the Force Majeure Event.

                                                                              39

<PAGE>

14.      KEY PERFORMANCE INDICATORS

14.1     COMPLIANCE WITH KPIs AND REMEDIATION

         (a)      Lucent must comply with each of the KPIs used for measuring
                  the performance of Lucent's obligations under this Agreement.

         (b)      Telstra will measure the performance of Lucent according to
                  the extent to which Lucent has and is achieving the KPIs.

         (c)      If, in the reasonable opinion of Telstra, Lucent fails to
                  perform to the standard required by a KPI, Telstra may (among
                  other things):

                  (i)      require Lucent to submit to Telstra, within the
                           period specified by Telstra, a remedial plan
                           specifying the process to be followed by Lucent to
                           remedy a failure to perform to the standards of a KPI
                           ("REMEDIAL PLAN"); or

                  (ii)     exercise the relevant Performance Indicator Rights.

         (d)      If Lucent does not implement a Remedial Plan immediately upon
                  notification by Telstra that the Remedial Plan is acceptable
                  to Telstra, or if implementation of the Remedial Plan does
                  not, in the opinion of Telstra, result in Lucent performing to
                  the standard required by the relevant KPIs, Telstra:

                  (i)      may exercise the relevant Performance Indicator
                           Rights; or

                  (ii)     acquire the items of Equipment or any part of the
                           items of Equipment from another source.

         (e)      Without limiting any other clause of this Agreement, Lucent
                  must reimburse to Telstra all direct costs and expenses
                  reasonably incurred by Telstra in exercising its rights under
                  clause 14.1(d).

         (f)      Telstra does not need to give Lucent notice before exercising
                  its Performance Indicator Rights in accordance with this
                  clause 14.

         (g)      To the extent that a Performance Indicator Right involves a
                  cost to Lucent, Telstra and Lucent agree that the cost is a
                  reasonable and genuine pre-estimate of the anticipated or
                  actual loss which would be incurred by Telstra as a result of
                  Lucent not performing to the standard required by a KPI.

         (h)      Action taken by Telstra under this clause 14 is without
                  prejudice to any other right or remedy of Telstra whether
                  under this Agreement or at Law and does not operate as a
                  waiver of any of Telstra's rights under this Agreement or at
                  Law.

14.2     KPI REPORTS

         (a)      Lucent must provide Telstra with written reports reporting on
                  the performance of Lucent's obligations under this Agreement
                  ("KPI REPORTS").

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<PAGE>

         (b)      The KPI Reports must be provided monthly and be in the form
                  notified by the Telstra Contract Administrator to the Lucent
                  Contract Administrator from time to time.

15.      PASSING OF PROPERTY

         Property in, title to and risk in any item of Equipment and/or System
         (as the case may be) passes to Telstra on the Date for Loading.

16.      WARRANTIES

16.1     DESIGN DEFECTS

         Lucent represents and warrants to Telstra, and must ensure, that each
         item of Equipment will during the Design Warranty Period be free from
         Design Defects.

16.2     DESIGN DEFECT OBLIGATIONS

         (a)      Without prejudice to any other right or remedy of Telstra
                  (whether arising by Law or otherwise) Lucent will at no cost
                  to Telstra:

                  (i)      recover and, in its sole discretion, either repair,
                           replace or rectify any Design Defect in an item of
                           Equipment which occurs within the Design Warranty
                           Period; and

                  (ii)     deliver the repaired, replacement or rectified item
                           of Equipment to the original location of the item of
                           Equipment the subject of the Design Defect, within
                           the Replacement Turnaround Time.

         (b)      For the purposes of clause 16.2(a), the cost of Lucent will
                  include, without limitation, the recovery of the item of
                  Equipment from its location, the repair or rectification of
                  the item of Equipment, the supply of the replacement item of
                  Equipment and the re-installation of the repaired, replacement
                  or rectified item of Equipment.

16.3     AVAILABILITY OF COMPONENTS

         (a)      Lucent warrants the availability of all components, modules or
                  other items (or equivalent) for each item of Equipment needed
                  for replacement purposes during the Design Warranty Period.

         (b)      Lucent must notify Telstra as to the likely obsolescence of
                  any component, module or other item (or equivalent) referred
                  to in clause 16.3(a) 12 months prior to that component, module
                  or other item (or equivalent) becoming obsolescent.

16.4     MINIMISATION OF COSTS REGARDING DESIGN DEFECTS

         Telstra and Lucent agree to co-operate to minimise recovery and
         installation costs associated with the rectification of a Design Defect
         during the Design Warranty Period for an item of Equipment including,
         but not limited to:

                                                                              41

<PAGE>

         (a)      supply by Lucent of replacement components free of charge and
                  payment to Telstra of an agreed sum to perform the recovery
                  and re-installation of the rectified item of Equipment on site
                  (which shall be the minimum practicable cost); or

         (b)      subject to Telstra's agreement, performance of the recovery
                  and re-installation of the rectified item of Equipment on site
                  by Lucent and payment to Telstra for agreed on-site
                  supervision.

         Alternatively, the parties may agree that Telstra, at the cost of
         Lucent, may recover the affected item of Equipment and require Lucent,
         at the cost of Lucent, to rectify the item of Equipment, following
         which, Telstra may, at the cost of Lucent, re-install the rectified
         item of Equipment.

16.5     DEFECTS

         (a)      Lucent represents and warrants to Telstra, and must ensure,
                  that each item of Equipment will during the Warranty Period be
                  free from Defects.

         (b)      Subject to clause 16.7, without prejudice to any other right
                  or remedy of Telstra (whether arising by Law or otherwise)
                  Lucent must at no cost to Telstra:

                  (i)      in its sole discretion, either repair, replace or
                           rectify any Defect which occurs within the Warranty
                           Period; and

                  (ii)     deliver the repaired, replacement or rectified item
                           of Equipment to a Site nominated by Telstra,

                  within the Replacement Turnaround Time.

         (c)      For the purposes of clause 16.5(b)(ii), the Lucent Contract
                  Administrator must contact the Telstra Site Contact at least 7
                  Business Days prior to the end of the Replacement Turnaround
                  Time seeking confirmation of the Site to which the repaired,
                  replacement or rectified item of Equipment is to be delivered.
                  The Telstra Site Contact must within 2 Business Days of being
                  contacted by the Lucent Contract Administrator notify the
                  Lucent Contract Administrator of the Site and the name and
                  contact details of the person who is authorised to receive in
                  person the repaired, replacement or rectified item of
                  Equipment.

16.6     ADDITIONAL OBLIGATIONS REGARDING DEFECTS

         The parties' respective responsibilities in relation to the work
         required under clause 16.5 are as follows:

         (a)      Telstra, at its cost, is responsible for the return to Lucent
                  at its St Peters, New South Wales facility (or such other
                  location agreed by the parties) of an item of Equipment
                  suspected by Telstra as being the subject of a Defect;

                                                                              42

<PAGE>

         (b)      upon receipt of that item of Equipment, Lucent must, subject
                  to clause 16.6(c), comply with clause 16.5(b); and

         (c)      if agreed to by Telstra, Lucent must within the Replacement
                  Turnaround Time provide items of equipment ("REPLACEMENT
                  ITEMS") as replacement for items of Equipment of an earlier
                  revision level for which a direct exchange was not available,
                  provided:

                  (i)      the Replacement Item is capable of operation with the
                           relevant System and otherwise complies with all other
                           requirements of this Agreement; and

                  (ii)     the Replacement Item is the latest revision version
                           of the item of Equipment it is replacing.

16.7     NO OBLIGATION REGARDING DEFECTS

         (a)      Lucent will not be required to comply with clauses 16.5(b) and
                  16.6:

                  (i)      if the relevant Defect was caused by:

                           (A)      negligence on the part of Telstra, its
                                    officers, employees, contractors or other
                                    representatives;

                           (B)      the use of the relevant item of Equipment
                                    not in accordance with the Documentation;

                           (C)      the wilful or malicious damage by persons
                                    other than Lucent, its officers, employees,
                                    contractors or other representatives; or

                           (D)      a flood or electrical storm; or

                  (ii)     if Lucent establishes, to the satisfaction of
                           Telstra, that a Defect in an item of Software was
                           directly caused by a bug in, or interruption to the
                           use of, the relevant item of Software that was beyond
                           the reasonable control of Lucent.

         (b)      Where an item of Equipment is found by Lucent to have been
                  caused by an event described in clause 16.7(a), Lucent must:

                  (i)      advise Telstra of the cost of repairing, replacing or
                           rectifying that item of Equipment; and

                  (ii)     at Telstra's direction, repair, replace or rectify
                           that item of Equipment.

         (c)      Where Telstra pursuant to clause 16.7(b)(ii) directs Lucent to
                  repair, replace or rectify an item of Equipment, Lucent may
                  invoice Telstra for all reasonable direct costs incurred by
                  Lucent for repairing, replacing or rectifying that item of
                  Equipment as a result of an event described in clause 16.7(a).

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<PAGE>

16.8     NO DEFECT FOUND

         (a)      Where the percentage of all items of Equipment returned to
                  Lucent pursuant to clause 16.6(a) with No Defect Found is less
                  than or equal to 15% of all items of Equipment returned to
                  Lucent in any 3 consecutive months, Lucent will advise the
                  Telstra Contract Administrator in writing of that percentage
                  and, if practicable, the nature of the No Defect Found. Lucent
                  will provide reasonable assistance to Telstra so that Telstra
                  may determine the reason for such items of Equipment being
                  returned to Lucent.

         (b)      Where the percentage of all items of Equipment returned to
                  Lucent pursuant to clause 16.6(a) with No Defect Found is
                  greater than 15% of all items of Equipment returned to Lucent
                  in any 3 consecutive months, Lucent may invoice Telstra for
                  the reasonable direct costs incurred by Lucent in determining
                  those items of Equipment had No Defect Found.

16.9     JOINT FIELD INVESTIGATIONS

         Telstra may request Lucent to undertake joint field investigations or
         visit a site to resolve problems during the term of this Agreement. If
         the request is due to a Design Defect, the cost of the field
         investigation will be borne by Lucent. If the request is due to another
         problem not directly related to Lucent, then the cost will be borne by
         Telstra.

16.10    WARRANTY REGARDING COMPATIBILITY

         Lucent represents and warrants to Telstra, and must ensure, that each
         item of Equipment will, when forming part of a System, be compatible
         with any other item of Equipment that forms part of, or is used in
         connection with, that System.

17.      PRICES

17.1     FIXED CONTRACT PRICES

         (a)      The Contract Prices are fixed for items of Equipment for the
                  first 12 month period of the Initial Term for which a Purchase
                  Order is issued, with variations only allowed for:

                  (i)      volume discounts in accordance with clause 3.4;

                  (ii)     exchange rate movements in accordance with clause
                           18.10;

                  (iii)    changes to customs duty in accordance with clause
                           18.2; or

                  (iv)     changes to GST in accordance with clause 19.

         (b)      Upon a determination being made for new Contract Prices in
                  accordance with clause 17.4, the new Contract Prices are fixed
                  for items of Equipment until the day of the next determination
                  being made in accordance with clause 17.4, with variations
                  only allowed for:

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<PAGE>

                  (i)      volume discounts in accordance with clause 3.4;

                  (ii)     exchange rate movements in accordance with clause
                           18.10;

                  (iii)    changes to customs duty in accordance with clause
                           18.2; or

                  (iv)     changes to GST in accordance with clause 19.

17.2     PRICES FOR ITEMS NOT LISTED

         Lucent must ensure that the prices offered to Telstra for items not
         listed in Schedule 2 are calculated in a manner consistent with the
         principles on which the Contract Prices were calculated.

17.3     WBV AND WBP

         (a)      Telstra is committed to purchasing the items of Equipment at
                  WBV and WBP and Lucent is committed to supplying the items of
                  Equipment at WBV and WBP.

         (b)      Lucent agrees:

                  (i)      in conjunction with Telstra, to develop and agree on
                           the principles for defining and measuring WBV and
                           WBP; and

                  (ii)     to carry out value engineering studies to develop,
                           and to implement, more efficient practices and
                           processes which provide the items Equipment to
                           Telstra at WBV and WBP.

17.4     DETERMINATION OF CONTRACT PRICES

         Lucent must, on reasonable request by Telstra, participate in
         negotiations with Telstra to agree to variations to the Contract Price
         for each 12 month period after the anniversary date of the Commencement
         Date ("REVIEW DATE"). If within 60 days after the revised prices are
         submitted by Lucent to Telstra, the parties are unable to agree to the
         revised prices, the matter must be referred to the Telstra Delegate and
         the Lucent Delegate within a further 7 days for determination. Until
         such a determination is made both parties will continue to abide by
         their obligations under this Agreement and clause 17.5 will apply until
         the determination by the Telstra Delegate and the Lucent Delegate. If
         the Telstra Delegate and the Lucent Delegate are not able to make a
         determination, Telstra or Lucent may in its absolute discretion
         terminate this Agreement.

17.5     PREVIOUS CONTRACT PRICE APPLICABLE PENDING DETERMINATION

         Telstra must pay the Contract Prices applicable for the immediately
         preceding period for items of Equipment ordered in the period following
         the Review Date until the new Contract Prices are determined under
         clause 17.4 ("APPLICABLE PERIOD"). As soon as reasonably practicable
         after the new Contract Prices are determined, the parties must make any
         necessary adjustment between the Contract Prices paid and

                                                                              45

<PAGE>

         the new Contract Prices for the Applicable Period to put the parties in
         the position which they would have been in (excluding interest) had the
         new Contract Prices applied from the first day following the day the
         Contract Prices are determined under clause 17.4.

18.      VARIATIONS OF CONTRACT PRICES

18.1     TAXES

         Lucent must ensure the Contract Prices:

         (a)      specify the GST exclusive amount, the GST payable on the
                  Contract Prices and the GST inclusive amount; and

         (b)      include customs duty for each item of Equipment.

18.2     CHANGES IN CUSTOMS DUTY

         Except for variations due to announced future changes in the rates of
         customs duty as at the Commencement Date, if the amount of customs duty
         included in the Contract Price is varied at any time after the
         Commencement Date and the date an item of Equipment is entered for home
         consumption by reason of:

         (a)      an alteration in legislation affecting customs duty;

         (b)      an alteration in the Schedule of Tariff Concession Orders;

         (c)      an alteration in a Tariff By-law;

         (d)      the issue of a ruling or an alteration in a ruling or advice
                  of the Comptroller-General of Customs, the Commissioner of
                  State Revenue or a Collector of Customs;

         (e)      the allowance to Lucent of a refund or drawback of duty in
                  respect of the Equipment;

         (f)      a decision of the Administrative Appeals Tribunal or a Court;
                  or

         (g)      the introduction or removal of a Ministerial determination on
                  decision,

         then the amount of customs duty applicable to that portion of the
         Equipment affected by any one or more of the above factors will vary
         proportionately with the movement in the rate of customs duty properly
         payable on, or the value of duty properly applicable to, the Equipment
         immediately before the alteration, ruling, advice, allowance, decision
         or determination takes effect.

18.3     DUMPING AND COUNTERVAILING DUTY

         Lucent is responsible for any dumping duty, countervailing duty,
         interim dumping duty, interim countervailing duty or cash security
         deposits imposed under any Law

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<PAGE>

         and any resultant GST in respect of an item of Equipment at any time
         after the Commencement Date.

18.4     RESPONSIBILITY FOR VARIATIONS

          Where there is a variation in the amount of customs duty under this
         clause 18, the applicable variation in the amount of customs duty will
         be borne by Telstra from the date of effect of the variation whether or
         not it is retrospective.

18.5     TELSTRA NOT LIABLE

         Telstra is not liable for:

         (a)      any increases in customs duty or additional taxes or
                  additional duties or penalties which may be imposed on Lucent
                  as the result of any error, act or omission on behalf of
                  Lucent, including the failure to make items of Equipment ready
                  by the Date for Loading; or

         (b)      any administrative, financial or other charges (except as
                  provided in clause 18.7) in relation to increases or decreases
                  in customs duty as a result of an alteration, ruling, advice,
                  allowance, decision or determination.

18.6     APPROVAL OF VARIATIONS

         (a)      Lucent must apply in writing to Telstra for approval (which
                  approval must not be unreasonably withheld or delayed) of all
                  variations in customs duty in respect of an item of Equipment.

         (b)      Upon Telstra giving its approval for the variation, Lucent
                  must prepare a revised Schedule 2 for execution by the parties
                  and incorporation into this Agreement.

18.7     LUCENT TO MAKE APPLICATION

         Lucent must, upon agreement between the parties (acting reasonably):

         (a)      make application for a refund or drawback of customs duty;

         (b)      make application through the Department of Industry, Science
                  and Resources for a Ministerial determination or decision, in
                  accordance with Part XVI of the Customs Act 1901 (Cth);

         (c)      challenge any decision of the Comptroller-General of Customs,
                  a Collector of Customs, a Commissioner of State Revenue, the
                  Commissioner of Taxation, a Deputy Commissioner of Taxation,
                  the Administrative Appeals Tribunal or a Court, or any
                  Ministerial determination or decision; or

         (d)      make application for a Tariff Concession Order or Tariff
                  By-law,

         which affects the amount of customs duty payable in respect of the
         Equipment and keep Telstra informed of the progress or results of any
         such application or challenge.

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<PAGE>
         The parties must use reasonable endeavours to agree the basis of
         reimbursement (if any) to Lucent for making any application or
         challenge under this clause 18.7 or assisting Telstra under clause
         18.8(b) before the application or challenge is made.

18.8     TELSTRA MAY SUPPORT

         (a)      Telstra may support any application referred to in clause 18.7
                  either direct to the relevant Minister, Comptroller-General of
                  Customs, the Commissioner of State Revenue, Collector of
                  Customs, the Commissioner of Taxation, Deputy Commissioner of
                  Taxation, the Administrative Appeals Tribunal or Court, or
                  through Lucent.

         (b)      Lucent must, if requested by Telstra, provide all reasonable
                  assistance to Telstra with respect to any action by Telstra
                  under this clause 18.8.

18.9     LUCENT TO RETAIN RECORDS

         Without limiting clause 21.3, Lucent must retain for the term of this
         Agreement or such other period as may be agreed and, at the request of
         Telstra, produce for inspection all papers, books and documents in its
         possession or control relating to the matters referred to in this
         clause 18 and provide Telstra on request with a copy of all
         applications, documents and communications.

18.10    EXCHANGE RATE VARIATION

         (a)      The exchange rate on which Contract Prices are based (if
                  applicable) as at any date an invoice is submitted to Telstra
                  under this Agreement, and the percentage of the Contract Price
                  for any Equipment which is subject to exchange variation, are
                  specified in Schedule 2.

         (b)      If the exchange rate applicable on the date of Lucent's
                  invoice varies more than 2% from the exchange rate specified
                  in Schedule 2 on which the Contract Price is based, then the
                  Contract Price will vary as follows:

                      EX1
                 VCP=(---xPCP)+BCP
                      EX2

                  where:

                  VCP   =  the varied Contract Price;

                  EX1   =  the exchange rate specified in Schedule 2;

                  EX2   =  the exchange rate applicable at the date of Lucent's
                           invoice;

                  PCP   =  the amount of the Contract Price subject to the
                           relevant exchange rate variation; and

                  BCP   =  the Contract Price minus the PCP.

                                                                              48

<PAGE>

         (c)      Adjustments under this clause 18.10 must be based on the spot
                  selling rate quoted by Westpac Banking Corporation for the
                  sale of $ for the relevant currency.

         (d)      Lucent must consolidate such adjustments for exchange rate
                  variation into a monthly statement and presented to Telstra at
                  the end of each month.

19.      GST

19.1     IMPOSITION OF GST

         If GST is imposed on any supply made by Lucent under this Agreement,
         Telstra must pay, in addition to any (GST-exclusive) consideration for
         the supply payable or to be provided by Telstra under any other clause
         of this Agreement, an additional amount calculated by multiplying the
         prevailing GST rate by that (GST-exclusive) consideration. Such payment
         is subject to Lucent issuing a Tax Invoice to Telstra:

         (a)      on the same invoice on which such additional GST amount is
                  charged to Telstra;

         (b)      that meets all the requirements set out in the defined term in
                  clause 1 for "Tax Invoice"; and

         (c)      that lists each separate product or service purchased by
                  Telstra under this Agreement as individual line items on the
                  invoice.

19.2     ADJUSTMENT OF GST SUBJECT TO TELSTRA'S APPROVAL

         If for any reason the amount recovered by Lucent from Telstra under
         clause 19.1 differs from either:

         (a)      the amount of GST payable at law by Lucent and Telstra has
                  provided a written approval or instruction to make an
                  adjustment to the amount paid which instruction or approval
                  will not be unreasonably withheld or delayed; or

         (b)      an amount payable which has been agreed with Telstra in
                  respect of the relevant supply,

         the amount payable by Telstra to Lucent will be adjusted accordingly
         (and, if an adjustment arises from an adjustment event for the purposes
         of the Goods and Services Tax Act, a corresponding Adjustment Note that
         meets the requirements set out for Adjustment Notes must be issued).

19.3     REDUCTIONS IN PRICES TO REFLECT ABOLITION OR REDUCTION OF TAXES

         Any reductions to the actual total costs of Lucent as may be attributed
         to:

         (a)      the supplies made under this Agreement;

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<PAGE>

         (b)      changes to the tax system as described in the ACCC Pricing
                  Guidelines on price exploitation released from time to time
                  relating to Part VB of the Trade Practices Act 1974 (the
                  "ACT"), any price exploitation provisions in the Act and in
                  any applicable State or Territory Fair Trading Legislation;
                  and

         (c)      the Goods and Services Tax Act,

         must be passed on to Telstra. Accordingly, Lucent agrees that the
         (GST-exclusive) consideration payable by Telstra under this Agreement
         must be reduced in line with the principle that the "net dollar margin"
         of Lucent must remain constant after taking account of reductions
         occurring either:

         (d)      directly as a result of the abolition of or reduction in taxes
                  payable by Lucent under the New Tax System legislation
                  (excluding reductions resulting from changes to the rates of
                  income tax); or

         (e)      indirectly by way of reductions in the prices (excluding any
                  amounts referrable to GST) charged by suppliers to Lucent and
                  input tax credits Lucent can claim in respect of acquisitions
                  of goods and services from suppliers to Lucent,

         but allowing for recoupment of costs directly related to compliance
         with the New Tax System changes, but excluding any general business
         costs as described in the ACCC Pricing Guidelines referred to above.
         Telstra reserves the right to do its own calculations to verify such
         price reductions and seek further information from Lucent to explain
         such price reductions.

19.4     COMPLIANCE WITH THE TRADE PRACTICES ACT

         If Telstra is dissatisfied with the reduction in the (GST-exclusive)
         consideration nominated or explained by Lucent pursuant to clause 19.3,
         Lucent must, upon receipt of a written request from Telstra, provide
         details sufficient to assure Telstra, acting reasonably, that Lucent
         has passed through to Telstra in the form of lower prices the benefit
         obtained or received by Lucent from any abolition or reduction of
         Taxes, (including but not limited to sales tax), undertaken in
         conjunction with the introduction of a GST or any subsequent change in
         the GST rate. Telstra reserves the right to initiate such a request at
         any time during the period of this Agreement or such other period as
         Telstra reasonably determines is necessary to show no further ongoing
         cost reductions have occurred under clause 19.3.

19.5     LUCENT TO RETAIN RECORDS

         Without limiting clause 21.3, Lucent must retain for the period of this
         Agreement and such additional period as agreed by the parties to show
         all ongoing cost reductions under clause 19.3 have occurred and at the
         reasonable request of Telstra, produce for inspection all papers, books
         and documents in Lucent's possession or control relating to the matters
         referred to in clause 19.3 and if the details provided under clause
         19.3 are not sufficient, provide Telstra on request with a copy of all
         applications, documents and communications. Failure to comply will
         result in Telstra withholding payments until compliance is complete.

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<PAGE>

19.6     TELSTRA'S GST PAYMENT REDUCED WHERE LUCENT HAS RECEIVED GST TAX CREDIT
         OR REFUND FROM THIRD PARTY

         Notwithstanding any other clause in this Agreement, Lucent must not be
         entitled to recover from Telstra any amount of GST which Lucent has
         paid or is liable to pay in relation to or in connection with any
         supply acquired by Lucent from a third party where Telstra is directly
         reimbursing these costs if Lucent has received, or is entitled to
         receive, any form of tax credit for, or refund of, that GST.

19.7     LUCENT TO PAY GST WHERE TELSTRA IS PROVIDING A TAXABLE SUPPLY TO LUCENT

         To the extent that any monies payable to Telstra under any other clause
         in this Agreement are regarded, for the purposes of the Goods and
         Services Tax Act, as consideration (in whole or in part) for a taxable
         supply made by Telstra such as (without limitation):

         (a)      in circumstances where Telstra is foregoing the right to sue;
                  or

         (b)      releasing Lucent from any Telstra claim in return for receipt
                  of compensation payment(s) (including, without limitation,
                  payment of liquidated damages),

         from Lucent under this Agreement, Lucent must pay an additional amount
         to Telstra calculated by multiplying the prevailing GST rate by the
         consideration payable to Telstra for the relevant supply under such
         other clause. In respect of any such taxable supply, the parties
         acknowledge and agree that Lucent will issue and provide to Telstra
         when directed by Telstra, a valid Recipient Created Tax Invoice at the
         same time as making payment for the supply to Telstra and Telstra must
         not issue a Tax Invoice. For the purposes of satisfying the
         requirements of the Goods and Services Tax Act and the additional
         requirements as determined by the Commissioner of Taxation from time to
         time, the parties agree that:

         (a)      Lucent must when directed by Telstra, issue Recipient Created
                  Tax Invoices in respect of any supplies by Telstra under this
                  Agreement;

         (b)      Telstra will not issue Tax Invoices in respect of any supply
                  by Telstra to Lucent under this Agreement where a Recipient
                  Created Tax Invoice is requested;

         (c)      Telstra acknowledges that it is registered for GST when it
                  enters into this Agreement and that it will notify Lucent if
                  it ceases to be registered; and

         (d)      Lucent acknowledges that it is registered when it enters into
                  this Agreement and that it will notify Telstra if it ceases to
                  satisfy any of the requirements for issuing Recipient Created
                  Tax Invoices as set out in the Good and Services Tax Act or as
                  determined by the Commissioner of Taxation from time to time.

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<PAGE>

20.      INVOICES AND PAYMENT

20.1     INVOICING INFORMATION

         Lucent must ensure that any invoice given to Telstra under this
         Agreement specifies the following details:

         (a)      the reference number of this Agreement;

         (b)      the Purchase Order number;

         (c)      the items of Equipment ordered;

         (d)      the quantity of each item of Equipment made ready for Loading;
                  and

         (e)      the Contract Price of each item of Equipment and invoice
                  total.

20.2     DELIVERY OF INVOICES

         (a)      Lucent must submit invoices for payments due by Telstra to
                  Lucent in respect of items of Equipment to the Telstra Invoice
                  Manager.

         (b)      Lucent must not submit an invoice to Telstra in respect of
                  items of Equipment unless Lucent has made ready for Loading
                  those items of Equipment by the applicable Date for Loading in
                  accordance with the terms of this Agreement and the relevant
                  Contract.

20.3     EDI TRADING AGREEMENT

         If the parties agree that invoices are to be transmitted
         electronically, Lucent must direct those invoices in an agreed format
         to Telstra's EDI mailbox as notified by Telstra.

20.4     PAYMENT

         Subject to Lucent complying with clauses 20.1 and 20.2, Telstra must
         pay the amount of each invoice within the later of:

         (a)      30 days after an invoice is received by Telstra; or

         (b)      30 days after Lucent has made ready for Loading the items of
                  Equipment the subject of the invoice in accordance with the
                  requirements of this Agreement.

20.5     LATE PAYMENT

         If any moneys due to a party under this Agreement remain unpaid after
         the date upon, or the expiration of the period within, which they
         should have been paid, then the matter will be referred at that party's
         request to the Telstra Delegate and the Lucent Delegate for resolution.

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<PAGE>

21.      ACCESS TO TELSTRA'S FACILITIES AND AUDIT

21.1     ACCESS

         Upon request from Lucent, Telstra must arrange for reasonable access to
         sites as agreed from time to time to enable Lucent to perform its
         obligations under this Agreement or any Contract, on such conditions as
         Telstra may reasonably require.

21.2     TERMS OF ACCESS

         Lucent's access to or use of any of Telstra's buildings or sites will
         be subject to Telstra's security, administrative arrangements and
         regulations notified by Telstra to Lucent from time to time,
         particularly those arrangements and regulations in relation to
         Telstra's interception and monitoring obligations.

21.3     RECORDS AND AUDIT

         (a)      Lucent must keep full and proper books of accounts and records
                  relating to the performance of Lucent's obligations under this
                  Agreement during the Term and for 7 years after the
                  termination or expiry of this Agreement.

         (b)      Lucent must comply with the record keeping requirements of the
                  Archives Act 1983 (Cth) for all records created for Telstra
                  for 7 years after the expiry or termination of this Agreement,
                  or such length of time as Telstra is part owned by the
                  Commonwealth, whichever is the earlier.

         (c)      Telstra or its personnel or both of them may, with the
                  agreement of Lucent (such agreement not to be unreasonably
                  withheld), enter any premises occupied by Lucent on reasonable
                  notice, and at reasonable times, to inspect, audit and, with
                  the agreement of Lucent (such agreement not to be unreasonably
                  withheld), take copies of the books, records and documents of
                  Lucent's business which directly relate to this Agreement.

         (d)      Lucent must give Telstra reasonable assistance in any
                  activities conducted under this clause 21.3, provided that if
                  any audit conducted under this clause 21.3 establishes that
                  Lucent has complied with this Agreement Telstra will pay
                  Lucent's reasonable costs in providing such assistance.

         (e)      This clause 21.3 does not limit any other clause of this
                  Agreement.

22.      STRUCTURED FINANCING

         Lucent:

         (a)      acknowledges Telstra may enter into structured financing
                  arrangements with a third party relating to the items of
                  Equipment, this Agreement or any Contract, including without
                  limitation, sale and lease-back type arrangements; and

         (b)      must provide reasonable assistance and provide reasonable
                  information and execute all documents acceptable to Lucent
                  which are reasonably required by

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<PAGE>

                  Telstra for the implementation of any structured financing
                  arrangement provided:

                  (i)      Telstra pays Lucent's reasonable costs incurred in
                           complying with this clause 22; and

                  (ii)     Telstra ensures that no structured financing
                           arrangement affects Telstra's payment obligations
                           under this Agreement or any Contract.

23.      INTELLECTUAL PROPERTY

23.1     PRICE INCLUDES ALL ROYALTIES

         Lucent represents and warrants that the Contract Price includes all
         amounts payable for or in respect of all Intellectual Property Rights
         referred to in this clause 23 and clause 10.1.

23.2     GRANTING OF LICENCES

         Lucent grants a perpetual, non-exclusive, royalty-free,
         non-transferable licence (including the right to sub-license) to:

         (a)      Telstra;

         (b)      a related body corporate of Telstra in Australia; and

         (c)      any other entity in Australia to which a material part of
                  Telstra's assets relating to this Agreement are transferred,
                  assigned or vested as part of a merger or reconstruction of
                  Telstra,

         to exercise the Lucent Intellectual Property for the Contract Purposes.

23.3     THIRD PARTY LICENCES

         Lucent must:

         (a)      obtain licences of all Intellectual Property Rights (other
                  than Lucent Intellectual Property) which is owned or
                  controlled by any third party supplier of any item of
                  Equipment (or component thereof) on terms and conditions no
                  less favourable than those specified in clause 23.2 (unless
                  Telstra otherwise agrees); or

         (b)      procure the grant to Telstra of licences to use the
                  Intellectual Property Rights referred to in clause 23.3(a) on
                  terms and conditions no less favourable than those specified
                  in clause 23.2 (unless Telstra otherwise agrees).

23.4     OWNERSHIP OF LUCENT INTELLECTUAL PROPERTY

         Lucent represents and warrants to Telstra, as at the Commencement Date
         and at all times after the Commencement Date, that the Lucent
         Intellectual Property is the

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<PAGE>

         property of Lucent or its subcontractors, and that Lucent has the right
         and power to grant the licences referred to in clauses 23.2, 23.7 and
         10.1.

23.5     INFRINGEMENT

         Lucent indemnifies Telstra and its officers, employees, contractors and
         agents against all liability, loss, damages, costs or expenses
         (including, without limitation, legal costs and expenses) which may be
         incurred by any of them arising out of or in connection with any claim,
         action or proceedings ("THIRD PARTY CLAIM") by any person alleging
         infringement of that person's Intellectual Property Rights on grounds
         in any way related to the Contract Purposes.

23.6     WHERE THIRD PARTY CLAIM MADE

         If a Third Party Claim is made:

         (a)      the party against whom the Third Party Claim is made must use
                  reasonable endeavours to notify the other party as soon as is
                  practicable;

         (b)      Lucent will have the carriage of and must at its own cost
                  conduct the defence of the Third Party Claim, but may not
                  settle it without Telstra's prior written consent (which will
                  not be unreasonably withheld where the settlement does not
                  adversely affect Telstra's rights under this Agreement); and

         (c)      if the Third Party Claim is successful, or if it is agreed
                  that there is an infringement of the Intellectual Property
                  Rights of the relevant person, Lucent must:

                  (i)      if possible, replace or modify the affected item
                           Equipment and/or System (as the case may be) (but
                           without adversely affecting its functionality or
                           performance) to render its use by Telstra
                           non-infringing; or

                  (ii)     at no cost to Telstra, render the relevant activity
                           non-infringing by procuring for Lucent or Telstra (as
                           the case requires) the right to exercise the
                           Intellectual Property Rights of the relevant person.

23.7     IMPROVEMENTS

         (a)      Title and interest in any improvements to the Lucent
                  Intellectual Property made by or on behalf of Telstra will
                  vest in and belong to Lucent.

         (b)      Lucent grants to Telstra:

                  (i)      a royalty free, exclusive (in Australia)
                           non-transferable licence (except to an entity
                           referred to in clauses 23.2(b) and 23.2(c)) for a
                           period of 12 months from the time the improvements
                           referred to in clause 23.7(a) are put into active
                           commercial use by Telstra; and

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                  (ii)     after the expiry of the period referred to in clause
                           23.7(b)(i), a perpetual, non-exclusive, royalty-free,
                           non-transferable licence (except to an entity
                           referred to in clauses 23.2(b) and 23.2(c))
                           (including the right to sub-licence),

                  to use, modify, adapt, develop, repair, maintain or enhance
                  those improvements.

23.8     MORAL RIGHTS

         In relation to the Lucent Intellectual Property the subject of the
         licences in clauses 23.2, 23.7 and 10.1 (together for the purposes of
         this clause 23.8 "IP MATERIAL"), Lucent gives its irrevocable consent,
         and will procure the irrevocable consent of each of its officers,
         employees, contractors and representatives, to Telstra in its absolute
         discretion for the Contract Purposes, reproducing, publishing, copying,
         adapting, performing, communicating, showing or exhibiting in or to the
         public, materially disturbing, destroying, mutilating, altering or in
         any other way changing the IP Material, or otherwise using the IP
         Material (or a substantial part or adaptation of it):

         (a)      with or without attribution of authorship;

         (b)      with or without any other materials comprised in the IP
                  Material;

         (c)      with or without any other text, data, title, sounds or images
                  (whether animated or not);

         (d)      in any medium;

         (e)      in any context; or

         (f)      in any way it sees fit.

23.9     YEAR 2000 COMPLIANCE

         (a)      In addition to and without limiting Lucent's obligations
                  pursuant to this Agreement and pursuant to Laws which cannot
                  be excluded Lucent agrees and represents that any System, item
                  of Equipment or Material licensed or otherwise provided to
                  Telstra under this Agreement is Year 2000 Compliant. If such
                  System, item of Equipment or Material proves not to be Year
                  2000 Compliant at any time or Telstra reasonably considers
                  that such System, item of Equipment or Material is not likely
                  to be Year 2000 Compliant, Lucent must:

                  (i)      promptly make the System, item of Equipment or
                           Material Year 2000 Compliant (by providing such
                           updates and/or services as may be required), at no
                           cost to Telstra; and

                  (ii)     indemnify Telstra against all loss which may be
                           suffered or incurred by Telstra arising out of or in
                           connection with the failure of the System, item of
                           Equipment or Material to be Year 2000 Compliant.

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         (b)      If Lucent becomes aware of any failure of any System, item of
                  Equipment or Material licensed or otherwise provided to
                  Telstra under this Agreement to be Year 2000 Compliant at any
                  time, Lucent must immediately notify Telstra in writing.

24.      CONFIDENTIALITY

24.1     CONFIDENTIALITY OBLIGATIONS

         A Recipient must:

         (a)      take all action reasonably necessary to maintain the
                  confidentiality of the Disclosing Party's Confidential
                  Information;

         (b)      not disclose the Disclosing Party's Confidential Information
                  to any person except as permitted under clause 24.2;

         (c)      use or reproduce the Disclosing Party's Confidential
                  Information only for the purposes of this Agreement;

         (d)      not make, assist or permit any person (including its
                  representatives) to make any unauthorised use, disclosure or
                  reproduction of the Disclosing Party's Confidential
                  Information;

         (e)      take all steps reasonably necessary to secure the Disclosing
                  Party's Confidential Information against theft, loss or
                  unauthorised disclosure;

         (f)      take reasonable steps to ensure that any person who has access
                  to Confidential Information of the Disclosing Party through it
                  or on its behalf does not use, reproduce or disclose that
                  Confidential Information other than in accordance with this
                  Agreement;

         (g)      take reasonable steps to enforce the confidentiality
                  obligations imposed or required to be imposed by this
                  Agreement including diligently prosecuting at its cost any
                  breach or threatened breach of such confidentiality
                  obligations by a person to whom it has disclosed Confidential
                  Information of the Disclosing Party; and

         (h)      on request by the Disclosing Party provide and update promptly
                  a list of all its representatives to whom Confidential
                  Information of the Disclosing Party has been disclosed.

24.2     PERMITTED DISCLOSURES

         This Agreement does not prohibit the disclosure by a Recipient of
         Confidential Information of the Disclosing Party:

         (a)      to a representative of the Recipient who needs to know the
                  Confidential Information for the purposes of this Agreement as
                  long as the Recipient takes reasonable steps to ensure that
                  the representative is fully aware of the

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                  confidential nature of the Confidential Information of the
                  Disclosing Party before the disclosure is made;

         (b)      which is required to be disclosed by Law, provided that the
                  Recipient has:

                  (i)      given the Disclosing Party sufficient notice to
                           enable the Disclosing Party to seek a protective
                           order or other relief from disclosure; and

                  (ii)     provided all assistance and co-operation which the
                           Disclosing Party reasonably considers necessary for
                           that purpose; or

         (c)      in respect of which the Disclosing Party has given its consent
                  to disclosure or use, which consent may be given or withheld
                  in its absolute discretion.

24.3     DISCLOSURE TO THE COMMONWEALTH

         Notwithstanding any other provision of this Agreement, Telstra may
         disclose any information, including Confidential Information:

         (a)      as required or authorised by the Telstra Corporation Act 1991
                  (Cth); and

         (b)      as required by the listing rules of any stock exchange where
                  Telstra's securities are listed or quoted.

24.4     RETURN OF CONFIDENTIAL INFORMATION

         Each party agrees to deliver to the other party all documents (other
         than the Recipient's internal documents) and other materials in any
         medium in the possession or under the power or control of the party or
         any of its representatives which contain or refer to any Confidential
         Information of the other party on the earlier of:

         (a)      demand by the other party; or

         (b)      the time the documents and other materials are no longer
                  required for the purposes of this Agreement.

24.5     INJUNCTIVE RELIEF

         Each party acknowledges that damages may not be a sufficient remedy for
         any breach of this clause 24 and each party is entitled to seek
         specific performance or injunctive relief (as appropriate) as a remedy
         for any breach or threatened breach by the other party, in addition to
         any other remedies available at Law.

24.6     PUBLIC ANNOUNCEMENTS

         Telstra or Lucent may not make any public announcement in relation to
         this Agreement, including the fact that it exists, without the prior
         written approval of the other party (acting reasonably) on such terms
         and conditions as Telstra and Lucent agree.

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24.7     ENFORCEMENT

         Each party:

         (a)      must take all reasonable steps required by the other party to:

                  (i)      protect the confidentiality of each other party's
                           Confidential Information; and

                  (ii)     enforce any obligation of confidence imposed or
                           required to be imposed by this Agreement or
                           otherwise,

                  and must immediately notify the other party of any information
                  which comes to its attention regarding any actual or potential
                  disclosure or unauthorised use of or access to, Confidential
                  Information or Intellectual Property Rights of that other
                  party; and

         (b)      undertakes, in the case of uncertainty:

                  (i)      on its part; or

                  (ii)     in the case of Lucent, of its representatives,

                  as to the confidentiality of any Confidential Information of
                  the other party, to procure and ensure that the Confidential
                  Information of that other party must be treated as
                  confidential and not within the public domain.

25.      REPRESENTATIONS AND WARRANTIES

         Lucent represents and warrants to Telstra as at the Commencement Date
         and at all times after the Commencement Date, that:

         (a)      it has full power and authority to enter into, perform and
                  observe its obligations under this Agreement and any Contract;

         (b)      it has taken all necessary action to authorise the execution,
                  delivery and performance of this Agreement in accordance with
                  its terms;

         (c)      the execution, delivery and performance by it of this
                  Agreement do not and will not violate:

                  (i)      any law, regulation, authorisation, ruling, consent,
                           judgment, order, official directive or decree of any
                           governmental agency;

                  (ii)     its constitution or other constituent documents; or

                  (iii)    any encumbrance, undertaking or document which is
                           binding upon it or on any of its assets;

         (d)      this Agreement constitutes its legal, valid and binding
                  obligations and is enforceable in accordance with its terms
                  subject to any necessary stamping

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                  and registration requirements and to equitable principles and
                  laws generally affecting creditors' rights;

         (e)      it is not aware of any fact which would prevent any insurance
                  policy applicable to this Agreement sustaining a claim being
                  made in the context of the performance of this Agreement,
                  including any non-compliance with conditions precedent to the
                  operation of that insurance policy;

         (f)      an Insolvency Event does not exist and is not likely to arise
                  in relation to Lucent;

         (g)      Lucent's systems are Year 2000 Compliant;

         (h)      a conflict of interest or risk of conflict of interest does
                  not exist and is not likely to arise in relation to the
                  performance of Lucent's obligations under this Agreement;

         (i)      all items of Equipment, Materials, work and any services
                  comply with all legal requirements and the requirements of all
                  governmental agencies and applicable Australian Standards and
                  Telstra standards and are otherwise suitable in all respects
                  for their purpose as contemplated by this Agreement or any
                  Contract;

         (j)      where no Australian Standard or Telstra standard is applicable
                  to any items of Equipment, Material, work or services, that it
                  has acted in accordance with current industry standards;

         (k)      in entering into this Agreement it has relied upon its own
                  interpretation of any information provided by Telstra and has
                  satisfied itself of its ability to perform its obligations
                  under this Agreement; and

         (i)      it holds and will continue to hold Endorsed Supplier status.

26.      INDEMNITY

26.1     INDEMNITY

         Subject to clauses 26.2 and 26.3, Lucent indemnifies Telstra against
         any cost, liability, loss or damage incurred or suffered by Telstra
         arising out of or in connection with:

         (a)      a breach of this Agreement or any Contract by Lucent;

         (b)      a wilful, unlawful or negligent act or omission of Lucent or
                  its officers, employees, agents or subcontractors;

         (c)      any injury to or death of a natural person, and any loss of or
                  damage to a third party's property, real or personal, caused
                  or contributed to by Lucent or its officers, employees, agent
                  or subcontractors;

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         (d)      any workers' compensation claim made against Telstra by or in
                  relation to any personnel employed or contracted by Lucent to
                  perform work in relation to this Agreement;

         (e)      any claim, act or proceeding by a third party against Telstra
                  caused or contributed to by Lucent or its officers, employees,
                  agents or subcontractors; and

         (f)      any loss of or damage to property of Telstra, real or
                  personal, caused or contributed to by Lucent or its officers,
                  employees, agents or subcontractors.

26.2     CONSEQUENTIAL LOSS

         Notwithstanding any other clause of this Agreement, a party shall not
         be liable to the other party for loss of profit, revenue or opportunity
         except for such losses arising out of or in connection with a:

         (a)      Third Party Claim; or

         (b)      claim falling within clauses 26.1(c), (d) or (f).

26.3     LIMITATION OF LIABILITY

         Notwithstanding any other clause of this Agreement, but subject to
         clause 26.2, the maximum aggregate liability of a party to the other
         party under or in connection with this Agreement, other than:

         (a)      a Third Party Claim;

         (b)      a claim falling within clause 24;

         (c)      a claim falling within clauses 26.1(c), (d) or (f); or

         (d)      to the extent that the liability arises from the wilful
                  misconduct or unlawful acts or omissions of the first party,

         is limited to 150% of the aggregate of the Contract Prices for all
         items of Equipment for which Purchase Orders have been received by
         Lucent under this Agreement at the time when the liability is
         determined.

27.      TERMINATION

27.1     RIGHT OF TELSTRA TO TERMINATE

         (a)      Telstra may, without prejudice to any other rights and
                  remedies it may have under this Agreement or at Law,
                  immediately terminate a Contract or this Agreement in whole or
                  in part, if:

                  (i)      Lucent commits a material breach of a Contract or
                           this Agreement which is capable of rectification and
                           Lucent does not rectify the breach within 30 days of
                           receipt of a notice in writing from Telstra;

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                  (ii)     Lucent commits a material breach of a Contract or
                           this Agreement which is not capable of rectification;

                  (iii)    the Telstra Delegate and the Lucent Delegate are
                           unable to make a determination under clause 17.4;

                  (iv)     an Insolvency Event occurs in relation to Lucent; or

                  (v)      in the reasonable opinion of Telstra, a material
                           change in ownership or control of Lucent occurs which
                           adversely affects Telstra's rights or Lucent's
                           ability to perform its obligations under any Contract
                           or this Agreement, or which is otherwise contrary to
                           Telstra's interests.

         (b)      For the avoidance of doubt, the cancellation of a Contract
                  under clause 5.10 is not a termination of the Contract for the
                  purposes of this clause 27.1.

27.2     RIGHT OF LUCENT TO TERMINATE

         Lucent may, without prejudice to any other rights and remedies it may
         have under this Agreement or at Law, immediately terminate a Contract
         or this Agreement in whole or in part by notice in writing to Telstra,
         if:

         (a)      Telstra commits a material breach of a Contract or this
                  Agreement and Telstra does not rectify the breach within 30
                  days of receipt of a notice in writing from Lucent;

         (b)      the Telstra Delegate and the Lucent Delegate are unable to
                  make a determination under clause 17.4; or

         (c)      an Insolvency Event occurs in relation to Telstra.

27.3     TERMINATION WITH NOTICE

         (a)      In addition to its rights under clause 27.1, Telstra may
                  terminate this Agreement in whole or in part at any time by
                  giving Lucent not less than 90 Business Days notice in writing
                  of the termination.

         (b)      Telstra and Lucent acknowledge that under the Commonwealth
                  Agreement the Commonwealth has the right, by written notice to
                  Telstra, and on reasonable grounds, to require Telstra to
                  cease, or procure any sub-contractor of Telstra to cease,
                  using any sub-contractor.

         (c)      Lucent agrees that if the Commonwealth exercises its right
                  referred to in clause 27.3(b) with respect to Lucent, Telstra
                  may, upon receiving the written notice referred to in that
                  clause, immediately terminate this Agreement by giving such
                  notice to Lucent.

         (d)      Where possible, Telstra will use reasonable endeavours to give
                  to Lucent prior notice of any intention of the Commonwealth
                  under the Commonwealth Agreement to remove Lucent.

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27.4     TELSTRA'S RIGHTS ON TERMINATION

         Upon termination of a Contract or this Agreement under clause 27.1,
         Telstra may:

         (a)      cease making any payment due under the relevant Contract or
                  this Agreement, as the case requires, for items of Equipment
                  not made ready for Loading by the Date for Loading;

         (b)      recover from Lucent all monies paid for any item of Equipment
                  but not yet made ready for Loading or works or services not
                  completed or provided under the relevant Contract or this
                  Agreement, as the case requires; and

         (c)      apply (without notice) any amount due from Telstra to Lucent
                  under this Agreement or any Contract towards the satisfaction
                  of:

                  (i)      any loss recoverable by Telstra from Lucent in
                           consequence of Lucent's breach of this Agreement or
                           any Contract; and

                  (ii)     any amounts payable by Lucent to Telstra under this
                           Agreement or any Contract, or any other agreement
                           between Telstra and Lucent,

         and Lucent authorises Telstra to do anything (including, without
         limitation, to execute documents) that is required for the purposes of
         clauses 27.4(a) to (c) inclusive.

27.5     EARLY TERMINATION

         If Telstra terminates this Agreement early under clauses 27.3(a) or (c)
         then, in addition to the application of clause 27.4:

         (a)      Lucent must complete its obligations under any Purchase Order
                  existing at the date of termination; and

         (b)      Telstra's obligation to pay (to the extent that it has not
                  already paid) any sums to Lucent will be no more than the sum
                  of properly incurred, undisputed and unpaid invoice amounts
                  payable under any Contracts in existence at the time of the
                  notice to terminate and any reasonable costs incurred by
                  Lucent in relation to the exercise of its rights under this
                  clause 27.5(b).

27.6     ANTECEDENT BREACHES AND OBLIGATIONS

         The expiry or termination of this Agreement or any Contract does not
         affect:

         (a)      either party's rights in respect of any breach occurring
                  before termination; or

         (b)      the obligations of the parties to make a payment under this
                  Agreement or any Contract due before termination.

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27.7     SURVIVING OBLIGATIONS

         Clauses 10.1(c), 14, 16.1, 16.2, 16.3, 16.5, 16.6, 16.7 16.9, 18.7, 19,
         21.3, 23, 24, 25, 26, 27.4, 27.5, 27.6, 27.7, 28, 33.1, 33.2, 33.3,
         33.5, 34(d), 35 and 36.14 survive the termination or expiry of this
         Agreement or any Contract.

28.      RESOLUTION OF DISPUTES

28.1     COMMITMENT

         Both parties acknowledge that they wish to make the terms of this
         Agreement work and are committed to resolving any disputes,
         controversies or differences ("DISPUTES") promptly should they arise.

28.2     DISPUTE NOTICE

         If a Dispute arises between Telstra and Lucent in relation to this
         Agreement, either of the parties may by notice to the other party
         specifying reasonable details of the Dispute ("DISPUTE NOTICE") refer
         the Dispute for resolution in accordance with this clause.

28.3     GOOD FAITH DISCUSSIONS

         (a)      If a Dispute Notice is given under clause 28.2, Telstra and
                  Lucent must procure that the Telstra Contract Administrator
                  and the Lucent Contract Administrator promptly meet and engage
                  in good faith discussions with the bona fide objective of
                  resolving the Dispute by agreement.

         (b)      If after a period of 10 Business Days (or such other period as
                  may be agreed) from the date on which a Dispute Notice is
                  delivered to a party, the Telstra Contract Administrator and
                  the Lucent Contract Administrator have not been able to
                  resolve the Dispute, either of them may then (but no earlier),
                  by notice, escalate the Dispute.

         (c)      If either party escalates the Dispute under clause 28.3(b),
                  Telstra and Lucent must procure that the Telstra Delegate and
                  the Lucent Delegate meet and engage in good faith discussions
                  with the bona fide objective of resolving the Dispute by
                  agreement.

         (d)      If after a period of 10 Business Days (or such other period as
                  may be agreed) from the date on which a meeting referred to
                  clause 28.3(c) took place the Telstra Delegate and the Lucent
                  Delegate have not been able to resolve the Dispute, either
                  party may then (but no earlier) refer the Dispute:

                  (i)      to mediation in accordance with clause 28.4 if the
                           Dispute is of a commercial or legal nature or if
                           otherwise agreed; or

                  (ii)     to an Independent Expert in accordance with clause
                           28.5, if the Dispute is of a technical nature.

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28.4     MEDIATION

         (a)      Any referral of a Dispute to mediation must be made by notice
                  to the other party including a statement of the matters in
                  Dispute.

         (b)      The mediation must be conducted in accordance with the ACDC
                  Mediation Guidelines in force from time to time and the
                  provisions of this clause 28.4. In the event of any
                  inconsistency between them, the provisions of this clause 28.4
                  will prevail.

         (c)      Mediations are to be conducted in private.

         (d)      The parties must notify each other no later than 48 hours
                  prior to mediation of the names of their representatives who
                  will attend the mediation.

         (e)      Nothing in this clause 28.4 is intended to suggest that the
                  parties are able to refuse the other party's chosen
                  representatives or to limit other representatives of the
                  parties attending during the mediation.

         (f)      The terms of any mediation, settlement agreements and any
                  information relating to the existence, conduct, status or
                  outcomes of the mediation is deemed to be Confidential
                  Information of each party and may be published or announced
                  only with the consent of all parties and in terms agreed by
                  the parties.

         (g)      The mediation will terminate in accordance with the ACDC
                  Mediation Guidelines.

         (h)      The parties will bear their own costs of the mediation
                  including the costs of any representatives and will each bear
                  half the costs of the mediator.

         (i)      Any agreement between the parties resulting from mediation
                  will bind the parties on its terms.

28.5     INDEPENDENT EXPERT

         (a)      Any referral of a Dispute to an Independent Expert must be
                  made by notice to the other party including a statement of the
                  matters in Dispute.

         (b)      Each party must provide to the Independent Expert a written
                  submission, incorporating all documentation, information
                  (confidential or otherwise), materials and statements of
                  persons relevant to the controversy or dispute.

         (c)      The parties agree that the Independent Expert's decision in
                  respect of the Dispute will be final and binding upon the
                  parties.

         (d)      The Independent Expert will act as an independent expert, not
                  as an arbitrator.

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         (e)      The fees of the Independent Expert will be borne in such
                  proportion and in such manner as the Independent Expert
                  decides, having regard to all relevant circumstances.

28.6     NO LEGAL PROCEEDINGS

         Neither Telstra nor Lucent may commence legal proceedings (other than
         for urgent interlocutory relief) in relation to any Dispute unless the
         dispute resolution procedures set out in this clause 28 have been
         followed and either:

         (a)      if the Dispute was referred to mediation, the mediation has
                  terminated under clause 28.4(g); or

         (b)      if the Dispute was referred to an Independent Expert, the
                  Independent Expert has made a decision under clause 28.5(c).

28.7     CONTINUATION OF OBLIGATIONS

         Notwithstanding the existence of a Dispute, the parties must continue
         to perform their obligations under this Agreement to the extent that
         such obligations are not the subject of the Dispute.

29.      ASSIGNMENT

29.1     ASSIGNMENT REQUIRES CONSENT

         Subject to clauses 29.2 and 29.3, neither party may transfer, assign,
         mortgage, charge or otherwise encumber or dispose of any of its rights
         under this Agreement or any Contract without the prior written consent
         of the other party.

29.2     TELSTRA'S RIGHTS

         (a)      Telstra may, without the consent of Lucent, transfer, assign,
                  novate, mortgage, charge or otherwise encumber or dispose of
                  any of its rights under this Agreement or any Contract to:

                  (i)      a related body corporate in Australia or any other
                           entity to which a material part of Telstra's assets
                           relating to this Agreement are transferred, assigned
                           or vested as part of a merger or reconstruction of
                           Telstra;

                  (ii)     NDC, or any subcontractor who is also an Ordering
                           Authority, provided NDC or that subcontractor is an
                           Australian related body corporate of Telstra; or

                  (iii)    a body corporate or entity in Australia which is
                           owned by, part of or an emanation or organ of the
                           government of the Commonwealth.

         (b)      Telstra may, with the consent of Lucent (which consent must
                  not be unreasonably withheld or delayed), transfer, assign,
                  novate, mortgage, charge or otherwise encumber or dispose of
                  any of its rights under this Agreement or

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                  any Contract to an entity in connection with any structured
                  financing arrangement entered into in accordance with clause
                  22.

29.3     LUCENT'S RIGHTS

         Lucent may, with the consent of Telstra (which consent must not be
         unreasonably withheld or delayed) transfer, assign, novate, mortgage,
         charge or otherwise encumber or dispose of any of its rights under this
         Agreement or any Contract to a related body corporate or any other
         entity to which a material part of Lucent's assets relating to this
         Agreement are transferred, assigned or vested as part of a merger or
         reconstruction of Lucent.

30.      SUBCONTRACTING

30.1     LUCENT MAY SUBCONTRACT WITH CONSENT

         Lucent must not subcontract the performance of all or part of its
         obligations under this Agreement or a Contract without Telstra's prior
         written consent.

30.2     SUBCONTRACT MUST BE CONSISTENT

         Unless Telstra otherwise agrees, the terms of any subcontract entered
         in accordance with clause 30.1 must be consistent with the terms of
         this Agreement and Lucent must, on request by Telstra, provide Telstra
         with a complete copy (excluding prices) of any subcontract entered into
         by Lucent (and any subcontract entered into under that subcontract)
         pursuant to clause 30.1.

30.3     REMOVAL OF SUBCONTRACTOR

         (a)      Lucent acknowledges that under the Commonwealth Agreement the
                  Commonwealth may, by written notice to Telstra, and on
                  reasonable grounds, request Telstra to procure any
                  subcontractor of Telstra to cease using any subcontractor of
                  that subcontractor.

         (b)      Telstra may, by written notice to Lucent, and on reasonable
                  grounds (including, without limitation, by reason of the
                  Commonwealth exercising the right referred to in clause
                  30.3(a)), require Lucent to immediately cease using any
                  subcontractor of Lucent.

30.4     LUCENT NOT RELIEVED OF OBLIGATIONS

         Lucent is:

         (a)      not in any way relieved from any of its obligations or
                  liabilities under this Agreement or any Contract, and Telstra
                  will have no liability to Lucent or any subcontractor of
                  Lucent, by or as a result of:

                  (i)      any consent by Telstra to the entry by Lucent into a
                           subcontract; and

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                  (ii)     the termination, amendment or variation of a
                           subcontract by Lucent, or any consent by Telstra to
                           any such termination, amendment or variation; and

         (b)      liable to Telstra for all acts or omissions of its
                  subcontractors (and any of their officers, employees, agents
                  and contractors) as fully as if they were the acts or
                  omissions of Lucent.

31.      DELEGATION BY TELSTRA

31.1     APPOINTMENT

         Telstra may, at its sole discretion, at any time during the term of
         this Agreement, appoint agents to exercise its rights and perform its
         duties under this Agreement. If Telstra appoints an agent under this
         clause 31.1, it must notify Lucent in writing specifying:

         (a)      the name of the agent;

         (b)      the contact details of the agent;

         (c)      the matters which the agent is authorised to attend to on
                  Telstra's behalf; and

         (d)      that the agent has executed an undertaking in writing that
                  they have read and understood clauses 24.1, 24.2, 24.4 and
                  24.7 of this Agreement and has agreed to comply with those
                  clauses (unless otherwise agreed by the parties).

31.2     LUCENT TO DEAL WITH AGENTS

         Lucent must deal with all agents appointed by Telstra under clause 31.1
         in relation to the matters delegated to them until such time as Telstra
         notifies Lucent that the agents are no longer its agents for those
         matters.

31.3     TELSTRA COMMUNICATIONS PREVAIL

         In the event of any inconsistency between communications from Telstra
         and communications from an agent appointed by Telstra under clause
         31.1, the communications from Telstra will prevail to the extent of the
         inconsistency.

32.      SALE OF EQUIPMENT BY TELSTRA

         Lucent acknowledges that Telstra may sell all or some of the items of
         Equipment to a related body corporate. If any related body corporate of
         Telstra buys any of the items of Equipment from Telstra, Lucent agrees
         that the related body corporate enjoys the benefit of each of the terms
         and conditions of this Agreement which are made in favour of Telstra,
         to the extent that those terms and conditions relate to the items of
         Equipment bought by that related body corporate.

                                                                              68

<PAGE>

33.      INSURANCE

33.1     INSURANCE

         Lucent must at its cost take out and maintain during the term of this
         Agreement and for 3 years after the expiration or termination of this
         Agreement or the last extant Contract that survives the expiration or
         termination of this Agreement (whichever is the later):

         (a)      subject to clause 33.4, a professional indemnity insurance
                  policy which must be endorsed to cover each employee,
                  sub-contractor, agent, designer or consultant of Lucent for
                  any claims that may arise under or in relation to this
                  Agreement;

         (b)      a comprehensive public and products liability insurance policy
                  to cover all sums which Lucent or Telstra may become legally
                  liable to pay consequent on:

                  (i)      the death of or bodily injury (including disease or
                           illness) to any natural person; and

                  (ii)     loss of, or damage to, real or personal property
                           (including the loss of use thereof);

         (c)      an insurance policy to cover all risks of loss, damage and
                  destruction (howsoever arising) including the indemnities
                  provided for in clause 26;

         (d)      motor vehicle insurance covering vehicle damage, liability for
                  death of or bodily injury to any person and for loss to third
                  party property caused by or arising from the use of all owned
                  and non-owned vehicles in the performance of this Agreement
                  and Lucent must ensure that all of its subcontractors and
                  other agents obtain such cover in respect of any vehicles
                  owned or operated by those subcontractors or agents;

         (e)      insurance in respect of all claims and liabilities arising
                  whether at common law or under statute relating to workers'
                  compensation or employer's liability from any accident or
                  injury to any person employed by Lucent in connection with
                  this Agreement and Lucent must ensure that all of its
                  subcontractors (if any) are similarly insured in respect of
                  their employees. Such insurance must comply with the laws of
                  the relevant jurisdiction in which the obligations of this
                  Agreement are carried out;

         (f)      insurance for each item of Equipment up to the applicable Date
                  for Loading, for an amount not less than their replacement
                  value;

         (g)      a policy of insurance against any and all liability or loss of
                  any kind whatsoever arising directly or indirectly from the
                  use, non-use, failure, breakage or any other act, omission or
                  matter arising in respect of any plant, equipment, tools,
                  appliances and other property owned, rented or hired by Lucent
                  and used in relation to this Agreement; and

                                                                              69

<PAGE>

         (h)      other insurance policies which a prudent person engaged in a
                  similar business or undertaking to that of Lucent would
                  effect.

33.2     INSURANCE REQUIREMENTS

         Lucent must ensure that each insurance policy required to be taken out
         by it under clause 33.1:

         (a)      contains on an annual basis a minimum cover of:

                  (i)      subject to clause 33.4, $20 million per claim in
                           respect of professional indemnity insurance;

                  (ii)     $20 million per claim for public liability insurance;

                  (iii)    $20 million per claim for products liability
                           insurance;

                  (iv)     $10 million in respect of motor vehicle insurance;
                           and

                  (v)      in any other case, as required by Law;

         (b)      is taken out with reputable insurers which are acceptable to
                  Telstra;

         (c)      subject to clause 33.3, names Telstra as an insured in a
                  manner acceptable to Telstra;

         (d)      is not amended or cancelled without Telstra's prior written
                  consent;

         (e)      subject to clause 33.3, includes a cross liability clause with
                  wording which is acceptable to Telstra;

         (f)      complies with the laws of the relevant jurisdiction in which
                  the obligations in this Agreement are to be performed; and

         (g)      includes any terms which Telstra may reasonably require.

33.3     PUBLIC LIABILITY INSURANCE

         Telstra and Lucent acknowledge and agree that:

         (a)      Lucent has represented to Telstra that Lucent has a world-wide
                  public liability insurance policy and accordingly it is unable
                  to include in such insurance policy:

                  (i)      Telstra as named insurer; or

                  (ii)     a cross liability clause in which Lucent's insurer
                           would waive all rights of subrogation or action
                           against Telstra; and

                                                                              70

<PAGE>

         (b)      due to clause 33.3(a), but without limiting clause 26, Lucent
                  indemnifies Telstra against any loss, cost or expense Telstra
                  incurs as a result of Lucent's insurer exercising a right of
                  subrogation against Telstra.

33.4     PROFESSIONAL INDEMNITY

         Telstra and Lucent acknowledge and agree that Lucent has represented to
         Telstra that Lucent self-insures for professional indemnity claims, and
         for so long as Lucent so self-insures Lucent is not required to comply
         with clauses 33.1(a) and 33.2(a)(i).

33.5     COMPLIANCE WITH INSURANCE POLICY TERMS

         Subject to clause 33.4, Lucent must comply with all of the terms and
         conditions of any insurance policy taken out by Lucent under clauses
         33.1 and 33.2.

33.6     REGISTRATION AS EMPLOYER

         Lucent must ensure that it is registered as an employer pursuant to all
         applicable Law relating to workers' compensation.

33.7     EVIDENCE OF INSURANCE

         Lucent must on request by Telstra, promptly provide to Telstra:

         (a)      copies of the Insurance Policies;

         (b)      a certificate of currency for the Insurance Policies; and

         (c)      evidence of the matters referred to in clauses 33.3 and 33.4.

33.8     CONDITION PRECEDENT

         No Contract Prices will be payable to Lucent until Lucent has effected
         all Insurances Policies and complied with clause 33.7.

33.9     DEALINGS WITH INSURERS

         Subject to any requirement of Law, Lucent must at all times keep
         Telstra informed of its dealings with its insurers or brokers (as the
         case may be) when calling upon the Insurance Policies for any event,
         act or omission in connection with this Agreement.

34.      OCCUPATIONAL HEALTH AND SAFETY

         (a)      Lucent must as a minimum, comply with, and ensure that its
                  personnel and subcontractors comply with:

                  (i)      any Laws, codes of practice and Australian Standards;
                           and

                  (ii)     Telstra environmental and occupational health and
                           safety policy, procedures and measures provided by
                           Telstra to Lucent from time to time,

                                                                              71

<PAGE>

                  which are applicable to this Agreement with respect to the
                  supply of the items of Equipment.

         (b)      Lucent will inform itself of all environmental and
                  occupational health and safety policies, procedures or
                  measures implemented or adopted by Telstra which are
                  applicable to this Agreement with respect to the supply of the
                  items of Equipment and which are notified by Telstra to Lucent
                  from time to time.

         (c)      Lucent acknowledges that Telstra does not purport to be an
                  expert on environmental or occupational health and safety
                  issues, nor does it purport to have the capacity to supervise,
                  review or audit Lucent's performance under this Agreement.
                  However, where Telstra becomes aware of an issue in relation
                  to the supply of the items of Equipment, and it informs Lucent
                  in writing that Lucent is:

                  (i)      not supplying the items of Equipment in compliance
                           with this clause 34; or

                  (ii)     supplying the items of Equipment in such a way as to
                           endanger the environment or the health and safety of
                           Lucent's employees or Telstra's employees, plant,
                           equipment or materials,

                  Lucent must promptly take all reasonable steps to remedy any
                  non-compliance. If the non-compliance has not been remedied
                  within 7 days of Lucent receiving the notice Telstra may
                  direct Lucent to suspend the Date for Loading of the items of
                  Equipment affected by any non-compliance with the requirements
                  of this clause 34 until such time as Lucent complies with its
                  obligations under this clause 34.

         (d)      Without limiting clause 26, Lucent must indemnify Telstra and
                  its officers, servants and agents against any direct costs,
                  losses, damages, expenses, actions, proceedings, judgments,
                  suits, claims, awards, demands and liabilities of any kind
                  including any reasonable costs or expenses arising out of
                  Lucent's failure to comply with its obligations under the
                  Occupational Health & Safety (Commonwealth Employment) Act
                  1991 (Cth), or any other Commonwealth, State or Territory
                  legislation that imposes obligations on Lucent in relation to
                  the manufacture, supply or installation of any plant,
                  equipment or substances.

         (e)      Lucent must provide Telstra with information in relation to
                  the items of Equipment which will enable Telstra, in
                  reasonably relying upon that information, to safely and in an
                  environmentally sound manner, undertake the operations or
                  activities referred to below (in so far as they are relevant
                  to any item of Equipment):

                  (i)      the transportation of the items of Equipment;

                  (ii)     the storage of the items of Equipment;

                                                                              72

<PAGE>

                  (iii)    the use of an item of Equipment for the purpose for
                           which it was designed;

                  (iv)     the testing and inspecting of the items of Equipment
                           (including details of the recommended frequency of
                           inspection and testing);

                  (v)      installation of the items of Equipment;

                  (vi)     commissioning practices and procedures;

                  (vii)    operating procedures;

                  (viii)   maintenance and service procedures;

                  (ix)     cleaning procedures;

                  (x)      the use of any substances recommended for any aspect
                           of the items of Equipment life cycle, for example in
                           its operation or maintenance, whether or not that
                           substance is supplied by Lucent;

                  (xi)     dismantling procedures (where the items of Equipment
                           are capable of being dismantled);

                  (xii)    the implementation of systems of work necessary for
                           the safe and environmentally sound use of the items
                           of Equipment;

                  (xiii)   the provision of appropriate safety warnings and
                           decals;

                  (xiv)    the installation of all necessary emergency
                           procedures; and

                  (xv)     the provision of information that will equip Telstra
                           with the necessary knowledge, to introduce the
                           training and develop the skills necessary for persons
                           undertaking each of the above activities.

35.      NOTICES

35.1     TYPES OF NOTICE

         A notice, approval, consent or other communication in connection with
         this Agreement, or any Contract ("NOTICE"):

         (a)      must be in writing; and

         (b)      must be left at the address of the addressee, or sent by
                  prepaid ordinary post (airmail if posted to or from a place
                  outside Australia) to the address of the addressee or sent by
                  facsimile to the facsimile number of the addressee which is
                  specified in this clause 35 or if the addressee notifies
                  another address or facsimile number then to that address or
                  facsimile number.

                                                                              73

<PAGE>

35.2     ADDRESSES

         The address and facsimile number of each party is:

         TELSTRA                                       LUCENT

         ADDRESS:                                      ADDRESS:

         Manager Supply, Access Equipment              Contracts Manager
         Corporate Supply                              Telstra Account
         6th Floor                                     Level 2
         242 Exhibition Street                         79 Victoria Parade
         Melbourne Vic 3000                            Collingwood Vic 3066

         FACSIMILE: (03) 9574 3577                     FACSIMILE: (03) 8413 9301

35.3     NOTICE TAKES EFFECT

         A notice takes effect from the time it is received unless a later time
         is specified in it.

35.4     DEEMED RECEIPT

         A letter or facsimile is taken to be received:

         (a)      in the case of a posted letter, on the third (seventh, if
                  posted to or from a place outside Australia) Business Day
                  after posting; and

         (b)      in the case of facsimile, on production of a transmission
                  report by the machine from which the facsimile was sent which
                  indicates that the facsimile was sent in its entirety to the
                  facsimile number of the recipient.

36.      MISCELLANEOUS

36.1     NO PARTNERSHIP

         Nothing in this Agreement or any Contract may be deemed to constitute a
         partnership, joint venture, agency or other legal relationship between
         Telstra and Lucent other than that of supplier and purchaser and
         nothing contained in this Agreement or any Contract authorises either
         party to waive any obligation for which the other party may be
         responsible or to incur any liability on behalf of the other party.

36.2     CO-OPERATION

         (a)      Lucent must sign all documents and do all things necessary or
                  desirable to give effect to this Agreement and will procure
                  its representatives to declare, make or sign all documents and
                  do all things necessary or desirable to give full effect to
                  this Agreement.

         (b)      In addition to and notwithstanding any other obligation under
                  this Agreement, Lucent will:

                                                                              74

<PAGE>

                  (i)      to the extent practical, co-operate with Telstra in
                           the pursuit of a Telstra's business objectives
                           relevant to this Agreement as advised in writing by
                           Telstra from time to time;

                  (ii)     pursue best practice in the delivery of the items of
                           Equipment pursuant to this Agreement; and

                  (iii)    as soon as practicable consult with Telstra on any
                           matter arising which may materially affect the
                           performance by Lucent of its obligations under this
                           Agreement.

         (c)      Except to the extent stated to the contrary in this Agreement,
                  any consent, approval, condition or thing required to be done
                  pursuant to this Agreement must not be capriciously or
                  unreasonably reached, withheld, given or carried out by
                  Lucent.

36.3     SEVERANCE

         If the whole or any part of a provision of this Agreement or any
         Contract is void, unenforceable or illegal in a jurisdiction it is
         severed from the remainder for the purposes of enforcement in that
         jurisdiction. The remainder of this Agreement or that Contract (as the
         case requires) has full force and effect and the validity or
         enforceability of that provision in any other jurisdiction is not
         affected. This clause 36.3 has no effect if the severance alters the
         basic nature of this Agreement or the relevant Contract or is contrary
         to public policy.

36.4     VARIATIONS

         (a)      Any term of this Agreement or a Contract may at any time be
                  varied provided the variation is contained in a Variation Form
                  that has been signed by the parties.

         (b)      Any aspect of the Schedules may be varied provided the
                  variation is contained in a Variation Form that has been
                  signed by the parties.

36.5     WAIVERS

         (a)      A provision of or a right created under this Agreement or any
                  Contract may not be waived except in writing executed by the
                  party granting the waiver.

         (b)      A failure by a party to insist upon a strict performance of
                  any of the terms and conditions of this Agreement or any
                  Contract is not be deemed a waiver of any subsequent breach or
                  default of the terms and conditions of this Agreement or any
                  Contract.

36.6     RIGHTS CUMULATIVE

         Except as expressly provided to the contrary in this Agreement or any
         Contract, the rights, powers and remedies provided in this Agreement or
         any Contract are

                                                                              75

<PAGE>

         cumulative with and not exclusive of the rights, powers or remedies
         provided by Law independently of this Agreement or any Contract.

36.7     ENTIRE AGREEMENT

         This Agreement and any Contract constitutes the entire agreement
         between the parties concerning the transactions contemplated by them
         and supersedes all previous negotiations and agreements concerning this
         transaction.

36.8     COUNTERPARTS

         This Agreement may be executed in any number of counterparts and the
         counterparts taken together will constitute one Agreement.

36.9     COMPLIANCE WITH LAW

         Lucent must, at its own cost, comply with all Laws and the lawful
         requirements of any statutory or other competent authority to the
         extent that they may apply to Lucent, the Equipment or the performance
         of this Agreement.

36.10    LAW AND JURISDICTION

         (a)      This Agreement and each Contract are governed by the laws of
                  Victoria.

         (b)      Each party submits to the non-exclusive jurisdiction of the
                  courts of Victoria, and any courts which may hear appeals from
                  those courts in respect of any proceedings in connection with
                  this Agreement.

36.11    ATTORNEYS

         Each attorney who executes this Agreement on behalf of a party declares
         that the attorney has no notice of the revocation or suspension by the
         grantor or in any manner of the power of attorney under the authority
         of which the attorney executes this Agreement and has no notice of the
         death of the grantor.

36.12    COSTS

         Each party must bear and is responsible for its own costs (including
         without limitation legal costs) in connection with the negotiation,
         preparation, execution, completion and carrying into effect of this
         Agreement or any Contract.

36.13    STAMP DUTY

         Lucent must bear all stamp duty on or in respect of this Agreement and
         any instrument or transaction contemplated by this Agreement or any
         Contract.

36.14    ENFORCEMENT OF INDEMNITIES

         (a)      It is not necessary for a party to incur expense or make
                  payment before enforcing a right of indemnity conferred by
                  this Agreement or any Contract.

                                                                              76

<PAGE>

         (b)      Each indemnity in this Agreement or any Contract is a
                  continuing obligation, separate and independent from the other
                  obligations of the parties and survives termination or
                  expiration of this Agreement or the relevant Contract.

36.15    TO THE EXTENT NOT EXCLUDED BY LAW

         The rights, duties and remedies granted or imposed under the provisions
         of this Agreement operate to the extent not excluded by Law.

36.16    NOTIFICATION OF CONFLICT OF INTEREST

         If a conflict of interest or risk of conflict of interest arises,
         Lucent must notify Telstra immediately of that conflict of interest or
         risk of conflict of interest, including a description of the conflict
         of interest and how Lucent intends to minimise any affect on Telstra.

EXECUTED as an agreement.

SIGNED for
TELSTRA CORPORATION LIMITED:

/s/ Mark Comer                       /s/ T. Pearson
_________________________            ___________________________________________
Signature of witness                 Signature of authorised representative

MARK COMER                           T. PEARSON
_________________________            ___________________________________________
Name                                 Name

SIGNED for
LUCENT TECHNOLOGIES AUSTRALIA
PTY LIMITED:

/s/ Don Baldwin                      /s/ Bart Vogel
_________________________            ___________________________________________
Signature of witness                 Signature of authorised representative

DON BALDWIN                          BART VOGEL
_________________________            ___________________________________________
Name                                 Name

                                                                              77<PAGE>

                                                                    EXHIBIT 10.2

                              DEED OF NOVATION AND
                                   ASSUMPTION

                           TELSTRA CORPORATION LIMITED
                               ABN 33 051 775 556

                     NETWORK DESIGN AND CONSTRUCTION LIMITED
                               ABN 64 086 174 781

                    LUCENT TECHNOLOGIES AUSTRALIA PTY LIMITED
                               ABN 44 002 326 687

                                                        JULY 2001
                                                        REF: PAD:CC 02-1265-1942

<PAGE>

                         DEED OF NOVATION AND ASSUMPTION

DATE   July 2001

PARTIES

         TELSTRA CORPORATION LIMITED ABN 33 051 755 556 of Level 41, 242
         Exhibition Street, Melbourne, Victoria, 3000 ("PRINCIPAL")

         NETWORK DESIGN AND CONSTRUCTION LIMITED ABN 64 086 174 781 of Level 12,
         35 Collins Street, Melbourne, Victoria, 3000 ("CONTRACTOR")

         LUCENT TECHNOLOGIES AUSTRALIA PTY LIMITED ABN 44 002 326 687 of Level
         21, 133 Castlereagh Street, Sydney, New South Wales, 2000 ("SUPPLIER")

RECITALS

A.       The Principal and the Supplier are parties to the PSA and the Principal
         and the Contractor are parties to the Construction Contract.

B.       The parties intend that, during the performance of the WUC, the
         Contractor will issue Purchase Orders under the PSA in respect of
         Equipment to be supplied by the Supplier under the PSA.

C.       Whilst the Principal and the Supplier wish to preserve the rights and
         obligations that they have to each other under the PSA, they intend
         that certain of the rights and obligations of the Principal should also
         be assumed by the Contractor so that those rights and obligations may
         be enjoyed by and be enforceable against the Contractor.

D.       The assumption of some of the rights and obligations of the Principal
         by the Contractor will be on the terms and conditions of the General
         Conditions and this deed.

OPERATIVE PROVISIONS

1.       INTERPRETATION

1.1      DEFINITIONS

         The following definitions apply in this deed, unless the contrary
         intention appears:

         "CONSTRUCTION CONTRACT" means the construction contract to be entered
         into between Telstra and the Contractor on pursuant to which the
         Contractor is to carry out the WUC.

         "EFFECTIVE DATE" means 12 July 2001.

         "EQUIPMENT" has the same meaning given in the PSA.

         "GENERAL CONDITIONS" means the general conditions of novation and
         assumption as set out in Attachment 1 to this deed.

         "PRICE LIST" means the price list for the Equipment that may be the
         subject of Purchase Orders. The Price List is set out in the PSA.

<PAGE>

         "PSA" means the product sourcing agreement number 900622 entered into
         between the Principal and the Supplier on 11 July 2001, a copy of which
         is set out in Attachment 2 to this deed, as varied from time to time,
         and which (among other things) sets out the terms and conditions on
         which the Principal acquires Equipment from the Supplier.

         "PURCHASE ORDER" means the agreement between the Contractor and the
         Supplier created from time to time in accordance with this deed and the
         PSA following the issue by the Contractor of a purchase order under the
         PSA. The terms and conditions of the Purchase Order are specified in
         the PSA.

         "WUC" means the whole of the work which the Contractor is or may be
         required to carry out and complete in accordance with the Construction
         Contract.

1.2      RULES FOR INTERPRETING THIS DEED

         The terms used in this deed have the same meaning as in the General
         Conditions, unless the contrary intention appears. Clauses 1.2, 8 and 9
         of the General Conditions apply to this deed.

2.       INCORPORATION OF GENERAL CONDITIONS

2.1      Each party to this deed agrees that the General Conditions are
         incorporated into this deed as if they were set out in full in this
         deed.

2.2      In the event of any inconsistency, ambiguity or conflict between this
         deed and the General Conditions, this deed shall take precedence.

2.3      The parties agree that:

         (a)      the Contractor is entitled to issue Purchase Orders under the
                  PSA in accordance with this deed; and

         (b)      any such Purchase Orders issued by the Contractor will be
                  assumed by the Contractor in accordance with this deed and the
                  Construction Contract.

3.       NOMINATION OF EXCLUDED OBLIGATIONS

3.1      Without limiting any future exercise by the Principal of its rights
         under clause 3 of the General Conditions, the Principal nominates in
         Attachment 3 to this deed certain obligations contained in the PSA
         which arise in connection with Purchase Orders which the Contractor is
         not obliged to perform.

3.2      The purported or actual performance by the Contractor of any excluded
         obligation referred to in clause 3.1 of this deed shall be ineffective,
         and the Supplier agrees the Principal is not in any way responsible to
         the Supplier for any loss incurred or suffered by the Supplier arising
         from or in respect of any purported or actual performance by the
         Contractor of any such excluded obligation.

                                                                              2.

<PAGE>

4.       EXERCISE OF RIGHTS UNDER THE PURCHASE ORDER

4.1      Without limiting any future exercise by the Principal of its rights
         under clause 4 of the General Conditions, the Principal nominates in
         Attachment 3 to this deed certain rights arising from the PSA in
         connection with Purchase Orders which the Contractor is not entitled to
         exercise.

4.2      The purported or actual exercise by the Contractor of any excluded
         right referred to in clause 4.1 of this deed shall be ineffective, and
         the Supplier agrees the Principal is not in any way responsible to the
         Supplier for any loss incurred or suffered by the Supplier arising from
         or in respect of any purported or actual exercise by the Contractor of
         any such excluded right.

4.3      The Contractor must, from time to time when requested to do so by the
         Principal, nominate a person or persons as specified in Attachment 4
         who is authorised to deal with the Principal and the Supplier in
         relation to:

         (a)      ordering;

         (b)      quality assurance;

         (c)      the compliance with those clauses of the PSA regarding the
                  effect of price changes as a consequence of changes in
                  taxation or currency values; and

         (d)      warehousing and distribution,

         with respect to Equipment that is the subject of a Purchase Order
         issued by the Contractor under the PSA in accordance with this deed.

5.       TITLE IN EQUIPMENT

         Title, risk and ownership in Equipment the subject of a Purchase Order
         will pass from the Supplier to the Contractor at the time title, risk
         and ownership would have passed from the Supplier to the Principal
         under the PSA.

6.       CONFIDENTIALITY AND CONFIRMATION

6.1      The Contractor acknowledges that the terms of the PSA are confidential
         to the Principal and the Supplier and that, unless otherwise agreed by
         the Principal and the Supplier, it has no right or entitlement to
         obtain, view or have knowledge of any of the terms and conditions of
         the PSA that relate to the excluded obligations and rights referred to
         in clauses 3 or 4 of this deed. In particular, the Contractor
         acknowledges and agrees that, unless otherwise agreed by the Principal
         and the Supplier, it has no right or entitlement to obtain, view or
         have knowledge of any of the prices in the PSA payable by the Principal
         for the supply of Equipment under the PSA.

6.2      The Contractor confirms that it has reviewed the obligations and rights
         under the PSA which it is assuming under this deed.

                                                                              3.

<PAGE>

7.       PRICE LIST

7.1      The parties agree that the PSA prices, as determined by reference to
         the Price List, will apply to Equipment ordered by the Contractor
         pursuant to a Purchase Order issued by the Contract under the PSA in
         accordance with this deed.

7.2      The Price List may be varied by the Principal and the Supplier in
         accordance with the terms and conditions of the PSA. The Principal will
         notify the Contractor in writing of any variations to the Price List.

8.       LIQUIDATED DAMAGES

         If, in relation to delays or failures in the supply of Equipment that
         is the subject of a Purchase Order issued by the Contractor in
         accordance with this deed:

         (a)      liquidated damages are or may be payable by; or

         (b)      any other remedial action is or may be taken against,

         the Supplier under the PSA, the Contractor must claim and manage the
         claim for those liquidated damages, or take any other relevant remedial
         action, on behalf of the Principal. The Contractor must give the
         Principal prior written notice of any claims for liquidated damages
         made, or any other relevant remedial action taken, against the
         Supplier.

9.       VARIATION OF PSA

         If the PSA is varied as between the Principal and the Supplier, the
         Principal will notify the Contractor of any relevant varied terms and
         conditions. Purchase Orders issued by the Contractor after notification
         of the variation are issued on the terms and conditions of the varied
         PSA.

10.      NON-TELSTRA ORDERS

         A Purchase Order must not be issued by the Contractor, or accepted by
         the Supplier, for Equipment unless the Equipment is to be used or
         applied for the benefit of the Principal.

11.      OWNERSHIP

11.1     The parties acknowledge that the Principal may sell all or some of the
         issued shares of the Contractor. Within a reasonable time after the
         occurrence of that sale, the Principal and the Supplier will meet at a
         time, day and place reasonably determined by the Principal (after
         consultation with the Supplier) to discuss whether that sale has any
         impact on the continuation of this deed.

11.2     For the avoidance of doubt, unless otherwise expressly agreed to by the
         Principal and the Supplier, the sale by the Principal of all or some of
         the issued shares of the Contractor does not relieve any party from
         complying with the terms and conditions of this deed, including
         Purchase Orders received by the Supplier prior to the date of that
         sale, and does not in any way affect the Principal's right to issue
         purchase orders with the Supplier under the PSA.

                                                                              4.

<PAGE>

12.      NOTICES

12.1     A notice, approval, consent or other communication in connection with
         this deed:

         (a)      must be given by a person authorised by the relevant party to
                  do so;

         (b)      must be in writing in the English language;

         (c)      must be marked for the attention of the person referred to in
                  clause 12.1(d) of this deed; and

         (d)      must be left at the address of the addressee, or sent by
                  prepaid ordinary post (airmail if posted to a place outside
                  the country in which it is posted) to the address of the
                  addressee, or sent by facsimile to the facsimile number of the
                  addressee in Australia which is specified in this clause 12,
                  or if the addressee notifies another address or facsimile
                  number in Australia then to that address or facsimile number.

         The address and facsimile number of each party is:

         THE PRINCIPAL
         Attention:
         Address:

         Facsimile:

         THE CONTRACTOR
         Attention:
         Address:

         Facsimile:

         THE SUPPLIER
         Attention: Alexander Woolley
         Address: Level 2, 79 Victoria Parade
                  COLLINGWOOD VIC 3066

         Facsimile: (03) 8413 9301
         Ph: (03) 8413 9014

12.2     Unless a later time is specified in it a notice, approval, consent or
         other communication takes effect from the time it is received.

12.3     A letter or facsimile is taken to be received:

         (a)      in the case of a posted letter, on the third (seventh, if
                  posted to a place outside the country in which it is posted)
                  day after posting; and

         (b)      in the case of a facsimile, on production of a transmission
                  report by the machine from which the facsimile was sent which
                  indicates that the facsimile was sent in its

                                                                              5.

<PAGE>

                  entirety to the facsimile number of the recipient notified for
                  the purpose of this clause 12.

13.      COUNTERPARTS

         This deed may be executed in any number of counterparts which, when
         taken together, shall constitute one instrument.

14.      OPERATION

         This deed shall operate on and from the Effective Date.

                                                                              6.

<PAGE>

                                  ATTACHMENT 1

                  GENERAL CONDITIONS OF NOVATION AND ASSUMPTION

1.       DEFINITIONS AND INTERPRETATION

1.2      DEFINITIONS

         The following words have these meanings in these General Conditions
         unless the contrary intention appears:

         "DEED" means the Deed of Novation and Assumption to which these General
         Conditions are attached and which incorporates the General Conditions;
         and

         "GENERAL CONDITIONS" means the general conditions set out in this
         Attachment 1.

1.2      INTERPRETATION

         In these General Conditions, unless the contrary intention appears:

         (a)      references to days mean calendar days and references to a
                  person includes an individual, firm or a body corporate or
                  unincorporate;

         (b)      the time for doing any act or thing under the Deed shall, if
                  it ends on a Saturday, Sunday or Statutory or public holiday,
                  be deemed to end on the day next following which is not a
                  Saturday, Sunday or Statutory or public holiday;

         (c)      clause headings and subclause headings in these General
                  Conditions shall not form part of these General Conditions and
                  shall not be used in the interpretation of the Deed;

         (d)      words in the singular include the plural and words in the
                  plural include the singular, according to the requirements of
                  the context. Words importing a gender include every gender;

         (e)      communications between the parties shall be in the English
                  language;

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

         (g)      a reference to any of the words 'include', 'includes' and
                  'including' is read as if followed by the words 'without
                  limitation';

         (h)      except as expressly provided in these General Conditions,
                  terms have the same meaning as in the PSA, Purchase Order and
                  the Deed;

                                                                              7.

<PAGE>

         (i)      unless expressly provided in these General Conditions, a
                  reference to these General Conditions or other instrument
                  includes any variation or replacement of either of them;

         (j)      a reference to a recital or clause is a reference to a recital
                  or clause of the Deed; and

         (k)      where an expression is defined, another part of speech or
                  grammatical form of that expression has a corresponding
                  meaning.

2.       ASSUMPTION BY THE CONTRACTOR

2.1      On and from the Effective Date, the Contractor:

         (a)      assumes and is bound by all of the terms and conditions of
                  each Purchase Order:

                  (i)      issued by the Contractor under the PSA in accordance
                           with the Deed; and

                  (ii)     which bind the Principal as and when the Principal
                           notifies the Contractor that the Purchase Order is
                           effective;

         (b)      subject to clause 3 of these General Conditions, must perform
                  all of the obligations of the Principal under or in connection
                  with such Purchase Order as if it were the Principal; and

         (c)      subject to clause 4 of these General Conditions, may exercise
                  all rights of the Principal under or in connection with such
                  Purchase Order as if it were the Principal.

2.2      Except as expressly provided in the Deed, clause 2.1 of these General
         Conditions does not release the Principal from its obligations under a
         Purchase Order that falls within clause 2.1(a)(ii) of these General
         Conditions or affect or limit, in any way, the Principal's rights under
         such Purchase Order. The Principal and the Contractor are severally
         obliged to perform the obligations of the Principal under that Purchase
         Order.

2.3      To avoid doubt, a right which arises by virtue of the exercise by the
         Contractor of a right under clause 2.1(c) of these General Conditions
         may be exercised by the Principal.

2.4      References in a Purchase Order that falls within clause 2.1(a) of these
         General Conditions to the Principal are also to be read as references
         to the Contractor.

3.       NOMINATION OF EXCLUDED OBLIGATIONS

3.1      As between the Principal and the Contractor, the Contractor will not be
         responsible for performing the obligations specified in clause 3.1 of
         the Deed, and the Contractor will be relieved from any liability
         arising from its failure to perform any of those obligations.

3.2      Clause 3.1 of these General Conditions takes effect as between the
         Principal and the Contractor only and does not operate to diminish or
         otherwise affect the Supplier's rights under clause 2 of these General
         Conditions.

                                                                              8.

<PAGE>

3.3      The Principal may nominate further excluded obligations under the PSA
         by written notice to the Supplier and the Contractor.

3.4      A nomination by the Principal under clause 3.3 of these General
         Conditions may by written notice to the Supplier and the Contractor be
         revoked or amended by the Principal, but only so as to take effect
         after the date of the revocation or amendment.

3.5      The Contractor agrees not to perform the obligations nominated under
         clause 3.3 of these General Conditions.

4.       EXERCISE OF RIGHTS UNDER THE PURCHASE ORDER

4.1      The Contractor must not exercise the rights specified in clause 4.1 of
         the Deed. The purported or actual exercise by the Contractor of any
         such excluded right shall be ineffective, and the Contractor shall
         indemnify the Principal against any loss incurred or suffered by the
         Principal or any claim, action, suit or demand brought or made against
         the Principal by the Supplier or by any other person arising from or in
         respect of any such purported or actual exercise.

4.2      The Principal may nominate further excluded rights under the PSA which
         must not be exercised by the Contractor, by written notice to the
         Supplier and the Contractor.

4.3      A nomination by the Principal under clause 4.2 of these General
         Conditions may by written notice to the Supplier and the Contractor be
         revoked or amended by the Principal, but only so as to take effect
         after the date of the revocation or amendment.

4.4      The Contractor agrees not to exercise the rights nominated under clause
         4.2 of these General Conditions.

4.5      Subject to clause 5 of these General Conditions and to avoid doubt, a
         right nominated by the Principal under clause 4.2 of these General
         Conditions may be exercised by the Principal.

5.       NO DUPLICATION OF THE SUPPLIER'S RIGHTS AND OBLIGATIONS

5.1      Proper performance by either the Principal or the Contractor of an
         obligation of the Principal under a Purchase Order will satisfy in full
         the Supplier's rights to have that obligation performed.

5.2      Proper performance by the Supplier of an obligation of the Supplier
         under a Purchase Order will satisfy in full both the Principal's and
         the Contractor's rights to have that obligation performed.

6.       TERMINATION

6.1      Except in relation to rights and obligations that:

         (a)      survive the termination or expiry of a Purchase Order; or

         (b)      arise in relation to Purchase Orders to which the Contractor
                  has become bound by virtue of clause 2 of these General
                  Conditions,

                                                                              9.

<PAGE>

         the Deed terminates:

                  (i)      upon the termination or expiry of the PSA or the
                           Construction Contract, whichever occurs earlier; or

                  (ii)     14 days after the day the Principal gives notice to
                           the other parties of its intention to terminate this
                           Deed.

7.       COSTS

7.1      Each party must bear its own costs, charges and expenses (including,
         without limitation), legal expenses in connection with the Deed except
         that the Principal, subject to clause 7.2 of these General Conditions,
         agrees to pay or reimburse the other parties for stamp duty, fees,
         taxes and charges payable in connection with the Deed.

7.2      If a goods and services tax or any similar tax ("GST") is imposed on
         any supply made by the Principal to another party under the Deed, the
         Principal may recover from the recipient of the supply, an amount on
         account of GST, to be calculated by multiplying the GST-exclusive
         market value of the supply by the prevailing GST rate.

8.       FURTHER ASSURANCES

         Each party agrees, at its own expense, to:

         (a)      execute and cause its successors to execute documents and do
                  everything else necessary or appropriate to bind the party and
                  its successors under the Deed; and

         (b)      use its best endeavours to cause relevant third parties to do
                  likewise to bind every person intended to be bound under the
                  Deed.

9.       GOVERNING LAW, JURISDICTION AND SERVICE OF PROCESS

9.1      The Deed will be interpreted under and governed by the laws of the
         State of Victoria.

9.2      The parties submit to the exclusive jurisdiction of the courts of the
         State of Victoria and any courts that may hear appeals from those
         courts in respect of any proceedings in connection with the Deed.

                                                                             10.

<PAGE>

                                  ATTACHMENT 2

                                       PSA

                                                                             11.

<PAGE>

                                  ATTACHMENT 3

            EXCLUDED PSA CLAUSES (NOT RELEVANT TO PERFORMING DUTIES)

3.4, 18.9, 27 (except to the extent that the Contractor is able to rely upon
clause 27 to terminate any Purchase Order), 29, 31 and 32.

                                                                             12.

<PAGE>

                                  ATTACHMENT 4

                                NOMINATED PERSONS

Attention:

Address:

Facsimile

(Or his or her delegate)

                                                                             13.

<PAGE>

EXECUTED as a deed

SIGNED, SEALED and DELIVERED for
TELSTRA CORPORATION LIMITED under power           /s/ KENNETH BENSON
of attorney in the presence of:                   ______________________________
                                                  Signature of attorney

/s/ PAULA BERTOLI                                 KENNETH BENSON
_______________________________________           ______________________________
Signature of witness                              Name

PAULA BERTOLI                                     June 4, 1999
_______________________________________           ______________________________
Name                                              Date of power of attorney

SIGNED, SEALED and DELIVERED for
NETWORK DESIGN AND CONSTRUCTION
LIMITED under power of attorney in the            /s/ PHILLIP HASTINGS
presence of:                                      ______________________________
                                                  Signature of attorney

/s/ J. A. PUTHERFORD                              PHILLIP HASTINGS
_______________________________________           ______________________________
Signature of witness                              Name

J. A. PUTHERFORD                                  May 21, 1998
_______________________________________           ______________________________
Name                                              Date of power of attorney

                                                                             14.

<PAGE>

SIGNED, SEALED and DELIVERED for
LUCENT TECHNOLOGIES AUSTRALIA PTY
LIMITED under power of attorney in the
presence of:
                                                  /s/ Bart Vogel
                                                  ______________________________
                                                  Signature of attorney

/s/ Don Baldwin                                   BART VOGEL
_______________________________________           ______________________________
Signature of witness                              Name

DON BALDWIN
_______________________________________           ______________________________
Name                                              Date of power of attorney

                                                                             15.

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