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                           ASIA GLOBAL CROSSING LTD.,

                                   as Company,

                 THE GUARANTORS PARTY HERETO FROM TIME TO TIME,

                                 as Guarantors,

                                       and

                    UNITED STATES TRUST COMPANY OF NEW YORK,

                                   as Trustee.

                                   INDENTURE

                          Dated as of October __, 2000

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                  INDENTURE dated as of October __, 2000, by and among Asia
Global Crossing Ltd., a Bermuda company (the "Company"), the Guarantors (as
herein defined) and United States Trust Company of New York, as trustee (the
"Trustee").

                             RECITALS OF THE COMPANY

                  The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.

                  All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.

                  NOW, THEREFORE, THIS INDENTURE WITNESSETH:

                  For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:

              ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01. DEFINITIONS

                  "144A Global Security" means a global security in the form of
Exhibit A-1 hereto bearing the Global Security Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Securities sold in reliance on Rule 144A.

                  "Acquired Debt" means, with respect to any specified Person,
(i) Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person and not
incurred in connection with, or in contemplation of, such other Person merging
with or into or becoming a Subsidiary of such specified Person, and (ii)
Indebtedness secured by a Lien encumbering any asset acquired by such specified
Person; provided such Indebtedness is existing at the time such asset is
acquired and is not incurred in connection with, or in contemplation of, such
acquisition; provided further that Indebtedness of such Person which is
redeemed, defeased, retired or otherwise repaid at the time of or immediately
upon the consummation of the transactions by which such Person becomes a
Restricted Subsidiary or is merged or consolidated with or into the Company or
any Restricted Subsidiary or such asset is acquired shall not be Indebtedness.

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

                  "Agent" means any Registrar, Paying Agent or co-registrar.

                  "all or substantially all" shall have the meaning given such
phrase in the Revised Model Business Corporation Act.

                  "Applicable Premium" means on any redemption date, the greater
of (i) 1.0% of the principal amount of such Note or (ii) the excess of (A) the
present value at such redemption date of (1) the redemption price of such Note
at the first possible redemption date pursuant to Section 3.07(a) hereof or
similar provision contained in any supplemental indenture (such redemption price
being set forth in the table in Section 3.07(a) hereof or such supplemental
indenture) plus (2) all required interest payments due on such Note through such
first possible redemption date (excluding accrued but unpaid interest), computed
using a discount rate equal to the relevant Treasury Rate plus 50 basis points
over (B) the principal amount of such Note, if greater.

                  "Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Security, the rules and
procedures of the Depositary, Euroclear and Clearstream
Banking that apply to such transfer or exchange.

                  "Asset Sale" means (i) the sale, lease, transfer, conveyance
or other disposition of any assets or rights (including, without limitation, by
way of a sale and leaseback) by the Company or any of its Restricted
Subsidiaries other than sales of inventory in the ordinary course of business
and other than any sale, lease, transfer, conveyance or other disposition of
capacity co-location space, dark fiber, rights of way or other access rights on
any cable system owned, controlled or operated by the Company or any Restricted
Subsidiary or of telecommunications capacity or transmission rights held by the
Company or any Restricted Subsidiary (provided that the sale, lease, transfer,
conveyance or other disposition of all or substantially all of the assets of the
Company and its Restricted Subsidiaries taken as a whole will be governed by the
provisions of Sections 4.14 and/or the provisions of Section 5.01 hereof and not
by the provisions of Section 4.10 hereof), and (ii) the issue or sale by the
Company or any of its Restricted Subsidiaries of Equity Interests of its
Subsidiaries, in the case of either clause (i) or (ii), whether in a single
transaction or a series of related transactions (a) that have a fair market
value in excess of $25.0 million or (b) for Net Proceeds in excess of $25.0
million. Notwithstanding the foregoing, the following items shall not be deemed
to be Asset Sales: (i) a transfer of assets by the Company to a Restricted
Subsidiary or by a Restricted Subsidiary to the Company or to another Restricted
Subsidiary, (ii) an issuance of Equity Interests by a Restricted Subsidiary to
the Company or to another Restricted Subsidiary, (iii) a Restricted Payment that
is permitted by Section 4.07 hereof, (iv) a transfer of assets by the Company or
a Restricted Subsidiary in connection with a Qualified Receivables Transaction,
(v) a disposition of obsolete, damaged or worn out property or equipment that is
no longer useful in the conduct of the business of the Company or any of its
Restricted Subsidiaries, (vi) a disposition of Cash Equivalents or investment
grade securities, (vii) transfers constituting the grant of a Permitted Lien and
(viii) the lease or sub-lease of any real or personal property in the ordinary
course of business.
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                  "Asset Sale Offer" shall have the meaning set forth in Section
4.10.

                  "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law or any similar provisions of Bermuda law for the relief of
debtors.

                  "Board of Directors" means the board of directors or other
governing body of the Company or, if the Company is owned or managed by a single
entity, the board of directors or other governing body of such entity, or, in
either case, any committee thereof duly authorized to act on behalf of such
board or governing body.

                  "Board Resolution" means a duly authorized resolution of the
Board of Directors.

                  "Business Day" means any day other than a Legal Holiday.

                  "Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized and
reflected as a liability on a balance sheet in accordance with GAAP.

                  "Capital Stock" means (i) in the case of a corporation,
corporate stock, (ii) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.

                  "Cash Equivalents" means (i) United States dollars, Japanese
Yen, Euros and British Pounds Sterling (and foreign currency exchanged into such
currencies within 180 days), (ii) securities issued or directly and fully
guaranteed or insured by the United States government or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (iii) certificates of deposit and
eurodollar time deposits with maturities of twelve months or less from the date
of acquisition, bankers' acceptances with maturities not exceeding twelve months
and overnight bank deposits, in each case with any domestic commercial bank
having capital and surplus in excess of $500 million, (iv) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clauses (ii) and (iii) above entered into with any
financial institution meeting the qualifications specified in clause (iii)
above, (v) commercial paper having one of the two highest ratings obtainable
from Moody's Investors Service, Inc. or Standard & Poor's Corporation and in
each case maturing within twelve months after the date of acquisition and (vi)
money market funds at least 95% of the assets of which constitute Cash
Equivalents of the kinds described in clauses (i)-(v) of this definition.

                  "Change of Control" means the occurrence of any of the
following: (i) any
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"person" (as such term is used in Section 13(d)(3) of the Exchange Act), other
than a Permitted Holder, is or becomes the beneficial owner, directly or
indirectly, of more than 50% of the Voting Stock (measured by voting power
rather than number of shares) of the Company and the Permitted Holders do not
have the right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of the Company (for
the purposes of this clause, such other person shall be deemed to "beneficially
own" any Voting Stock of a specified corporation held by a parent corporation if
such other person beneficially owns, directly or indirectly, more than 50% of
the Voting Stock (measured by voting power rather than by number of shares) of
such parent corporation and the Permitted Holders beneficially own, directly or
indirectly, in the aggregate a lesser percentage of Voting Stock (measured by
voting power rather than by number of shares) of such parent corporation and do
not have the right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of such parent
corporation), (ii) during any period of two consecutive years, Continuing
Directors cease for any reason to constitute a majority of the Board of
Directors of the Company, (iii) the Company consolidates or merges with or into
any other Person, other than a consolidation or merger (a) of the Company into a
Restricted Subsidiary of the Company or (b) pursuant to a transaction in which
the outstanding Voting Stock of the Company is changed into or exchanged for
cash, securities or other property with the effect that no Person, other than a
Permitted Holder, owns more than 50% of the Voting Stock (measured by voting
power rather than number of shares) of the surviving corporation immediately
following such transaction or (iv) the sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a series
of related transactions, of all or substantially all of the assets of the
Company and its Restricted Subsidiaries taken as a whole to any Person of which
more than 50% of its Voting Stock (measured by voting power rather than by
number of shares) is owned, directly or indirectly, following such transaction
or transactions by a Person other than the Permitted Holders; provided, however,
that sales, transfers, conveyances or other dispositions in the ordinary course
of business of capacity, co-location space, dark fiber, rights of way or other
access rights on cable systems owned, controlled or operated by the Company or
any Restricted Subsidiary or of telecommunications capacity or transmission
rights acquired by the Company or any Restricted Subsidiary for use in its
business, including, without limitation, for sale, lease, transfer, conveyance
or other disposition to any customer of the Company or any Restricted Subsidiary
shall not be deemed a disposition of assets for purposes of this clause (iv).
The definition of a Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance or other disposition of "all or substantially all"
of the assets of the Company and its Restricted Subsidiaries taken as a whole.
Although there is a developing body of case law interpreting the phrase
"substantially all," there is no precise established definition of such phrase
under applicable law. Accordingly, the ability of a Holder of Securities to
require the Company to purchase such Securities as a result of a sale, lease,
transfer, conveyance or other disposition of less than all of the assets of the
Company and its Restricted Subsidiaries taken as a whole to another Person or
group may be uncertain.

                  "Clearstream Banking" means Clearstream Banking, a limited
liability company (societe anonyme) organized under Luxembourg law.

                  "Company" means Asia Global Crossing Ltd., and any and all
successors
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thereto.

                  "Consolidated Capital Ratio" means, with respect to the
Company or any of its Restricted Subsidiaries, as of the date of any incurrence
of Indebtedness or issuance of Disqualified Stock or Preferred Stock, the ratio
of (i) the aggregate consolidated principal amount of Indebtedness outstanding
and the liquidation preference of Disqualified Stock as of the most recent
quarterly or annual balance sheet date, after giving pro forma effect to the
incurrence of such Indebtedness or the issuance of such Disqualified Stock and
any other Indebtedness incurred and Disqualified Stock issued since such balance
sheet date, and the receipt and application of the proceeds therefrom to (ii)
Consolidated Net Worth as of such balance sheet date after giving pro forma
effect to the issuance or sale of Equity Interests (other than Disqualified
Stock) (including Equity Interests (other than Disqualified Stock) that have
been issued upon conversion or exchange of any Indebtedness of the Company or
any Restricted Subsidiary), since the balance sheet date and the receipt and
application of the proceeds therefrom.

                  "Consolidated Cash Flow" means, with respect to the Company
for any period, the Consolidated Net Income of the Company and its Restricted
Subsidiaries for such period plus, to the extent that any of the following items
were deducted or added (without duplication) in computing such Consolidated Net
Income, (i) an amount equal to any extraordinary loss (less any extraordinary
gain) plus any net loss (less any gain) realized in connection with any Asset
Sale, plus (ii) provision for taxes based on income or profits of the Company
and its Restricted Subsidiaries for such period, plus (iii) Consolidated
Interest Expense of the Company and its Restricted Subsidiaries for such period,
whether paid or accrued and whether or not capitalized, plus (iv) any fees,
expenses or charges related to any Equity Offering, Permitted Investment,
acquisition or recapitalization or Indebtedness permitted to be incurred under
this Indenture (whether or not successful), plus (v) the amount of any non-cash
restructuring charge (excluding any such non-cash charge to the extent that it
represents an accrual of or reserve for cash expenses in any future period or
amortization of a prepaid cash expense that was paid in a prior period), plus
(vi) depreciation, amortization (including amortization of goodwill and other
intangibles and the amount of capacity available for sale charged to cost of
sales), but excluding amortization of prepaid cash expenses that were paid in a
prior period) and other non-cash expenses (excluding any such non-cash expense
to the extent that it represents an accrual of or reserve for cash expenses in
any future period or amortization of a prepaid cash expense that was paid in a
prior period) of the Company and its Restricted Subsidiaries for such period,
minus (vii) non-cash items increasing such Consolidated Net Income of the
Company and its Restricted Subsidiaries for such period (other than items that
were accrued in the ordinary course of business or that represent the reversal
of any accrual of, or cash reserve for, anticipated cash charges in any prior
period)), plus (viii) any change in Deferred Revenue, in each case, on a
consolidated basis and determined in accordance with GAAP. Notwithstanding the
foregoing, the provision for taxes on the income or profits of, and the
depreciation and amortization and other non-cash expenses of, a Restricted
Subsidiary of the Company shall be added to Consolidated Net Income to compute
Consolidated Cash Flow of the Company only to the extent that a corresponding
amount would be permitted at the date of determination to be dividended to the
Company by such Restricted Subsidiary without prior governmental approval (that
has not been obtained), and without direct or indirect restriction
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pursuant to the terms of its charter and all agreements (excluding agreements
evidencing Indebtedness incurred in accordance with clause (k) of Section 4.09
hereof, to which this provision shall not apply), instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that
Restricted Subsidiary or its shareholders, unless such restriction with respect
to the payment of dividends or similar distributions has been legally waived.

                  "Consolidated Interest Expense" for any Person means for any
period the consolidated interest expense included in a consolidated income
statement (without deduction of interest income) of such Person and its
Restricted Subsidiaries for such period, including without limitation or
duplication (or, to the extent not so included, with the addition of), (i)
amortization of debt issuance costs and original issue discount, (ii) non-cash
interest payments, (iii) the interest component of any deferred payment
obligations, (iv) the interest component of all payments associated with Capital
Lease Obligations, (v) commissions, discounts and other fees and charges
incurred in respect of Letter of Credit or bankers' acceptance financings and
(vi) net payments (if any) pursuant to Hedging Obligations.

                  "Consolidated Leverage Ratio" means, with respect to the
Company or any of its Restricted Subsidiaries, as of the date of any incurrence
of Indebtedness or issuance of Disqualified Stock or Preferred Stock, the ratio
of (i) the aggregate consolidated principal amount of Indebtedness outstanding
and the liquidation preference of Disqualified Stock as of the most recent
quarterly or annual balance sheet date, after giving pro forma effect to the
incurrence of such Indebtedness or the issuance of such Disqualified Stock and
any other Indebtedness incurred and Disqualified Stock issued since such balance
sheet date, and the receipt and application of the proceeds therefrom to (ii)
Consolidated Cash Flow for the four full fiscal quarters ending on or prior to
the date of incurrence of such Indebtedness or issuance of such Disqualified
Stock for which consolidated financial statements are available.

                  "Consolidated Net Income" means, with respect to the Company
for any period, the aggregate of the net income of the Company and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP, plus, to the extent that any of the following items were
deducted in computing such Consolidated Net Income, (a) non-recurring, non-cash
charges (other than charges arising from write-downs of assets) and (b) non-cash
compensation charges arising from stock options or other similar employee
benefit or compensation Plans; provided that (i) the net income (but not loss)
of any Restricted Subsidiary that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash (or if not in cash, to the extent actually converted
into cash) to the Company or a Restricted Subsidiary thereof by such Restricted
Subsidiary, (ii) the net income (or loss) of any Person that is not a Restricted
Subsidiary or Unrestricted Subsidiary shall be included only to the extent of
the amount of dividends or other distributions actually paid to the Company or a
Restricted Subsidiary by such Person during such period, (iii) for purposes of
clause (c) of Section 4.07 hereof, the net income of any Restricted Subsidiary
shall be excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that net income is not at
the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of the
terms of its charter or any
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agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its shareholders, unless
such restriction with respect to the payment of dividends or similar
distributions has been legally waived and except that the Company's equity in
the net income of any such Restricted Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate amount of cash that
could have been distributed by such Restricted Subsidiary during such period to
the Company or another Restricted Subsidiary as a dividend, (iv) the net income
of any Person acquired in a pooling of interests transaction for any period
prior to the date of such acquisition shall be excluded, (v) the equity of the
Company or any Restricted Subsidiary in the net income of any Unrestricted
Subsidiary shall be included in such Consolidated Net Income up to the aggregate
amount of cash (or if not in cash, to the extent actually converted into cash)
actually distributed by such Unrestricted Subsidiary during such period to the
Company or a Restricted Subsidiary as a dividend or other distribution (but not
in excess of the amount of the net income of such Unrestricted Subsidiary for
such period) and (vi) the cumulative effect of a change in accounting principles
shall be excluded.

                  "Consolidated Net Worth" means, with respect to the Company as
of any date, without duplication, the sum of (i) the consolidated equity of the
common shareholders of the Company and its consolidated Restricted Subsidiaries
as of such date plus (ii) the respective amounts reported on the Company's
balance sheet as of such date with respect to any series of Preferred Stock
(other than Disqualified Stock) that by its terms is not entitled to the payment
of dividends unless such dividends may be declared and paid only out of net
earnings in respect of the year of such declaration and payment, but only to the
extent of any cash received by the Company upon issuance of such Preferred
Stock, less (x) all write-ups (other than write-ups resulting from foreign
currency translations and write-ups of tangible assets of a going concern
business made within 12 months after the acquisition of such business)
subsequent to the date of this Indenture in the book value of any asset owned by
the Company or a consolidated Restricted Subsidiary of the Company, (y) all
investments as of such date in unconsolidated Restricted Subsidiaries and in
Persons that are not Restricted Subsidiaries, and (z) all unamortized debt
discount and expense and unamortized deferred charges as of such date, all of
the foregoing determined in accordance with GAAP.

                  "Consolidated Tangible Assets" means the total amount of
assets (less applicable reserves and other properly deductible items) which
under GAAP would be included on a consolidated balance sheet of the Company and
its Restricted Subsidiaries after deducting therefrom all Investments, goodwill,
trade names, trademarks, patents, unamortized debt discount and expense and
other like intangibles, which in each case under GAAP would be included on such
consolidated balance sheet; provided that with respect to a Restricted
Subsidiary that is not a Wholly Owned Restricted Subsidiary, its assets shall
only be included to the extent of the Company's percentage ownership of such
Restricted Subsidiary.

                  "Continuing Directors" means individuals who at the beginning
of the period of determination constituted the Board of Directors of the Company
together with any new directors whose election by such Board of Directors or
whose nomination for election by the shareholders of the Company was approved by
a vote of at least a majority of the directors of the Company then still in
office who were either directors at the beginning of such period or
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whose election or nomination for election was previously so approved or is a
designee of any one of the Permitted Holders or any combination thereof or was
nominated or elected by any such Permitted Holder(s) or any of their designees.

                  "Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.02 hereof or such other address
as to which the Trustee may give notice to the Company.

                  "Credit Facilities" is defined to mean one or more senior
credit agreements, senior loan agreements or similar senior facilities with
banks or other institutional lenders providing for revolving credit loans, term
loans, receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or Letters of Credit, in each case, as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time.

                  "Currency Agreement" means, with respect to any Person, any
foreign exchange contract, currency swap agreement or other similar agreement as
to which such Person is a party or beneficiary.

                  "Debt Securities" means any bonds, notes, debentures or other
similar instruments (excluding, in any event, (i) any Capital Lease Obligations
and (ii) any notes, bankers' acceptances or other instruments evidencing
commercial loans or equipment financing made by, and bills of exchange drawn on,
banks, other financial lending institutions or equipment vendors) issued by the
Company or by any Restricted Subsidiary (including by means of any Guarantee of
the Company or of any Restricted Subsidiary of securities of another Person),
whether in a public offering or private placement; provided, however, that in no
event shall "Debt Securities" mean Indebtedness in the form of a bank credit
facility.

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

                  "Deferred Revenue" means amounts appearing as a liability on
the financial statements of the Company and its Restricted Subsidiaries as
prepared in accordance with GAAP classified as deferred revenue to the extent of
cash received in connection therewith.

                  "Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 hereof, in
the form of Exhibit A-1 hereto except that such Note shall not bear the Global
Security Legend and shall not have the "Schedule of Exchanges of Interests in
the Global Security" attached thereto.

                  "Depositary" means, with respect to the Securities issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Securities, and any and all
successors thereto appointed as depositary hereunder and having become such
pursuant to the applicable provision of this Indenture.

                  "Designated Noncash Consideration" means the noncash
consideration received
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by the Company or any of its Restricted Subsidiaries in connection with an Asset
Sale that is so designated in an Officers' Certificate, less the amount of cash
or Cash Equivalents received in connection with a subsequent sale of such
Designated Noncash Consideration.

                  "Designated Preferred Stock" means Preferred Stock of the
Company (other than Disqualified Stock) that is issued for cash (other than to a
Restricted Subsidiary) and is so designated as Designated Preferred Stock,
pursuant to an Officers' Certificate, on the issuance date thereof.

                  "Disinterested Directors" means the non-management members of
the Board of Directors who have no relationship or interest in a particular
transaction other than their position as a director or shareholder of the
Company.

                  "Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder thereof), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
Holder thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Securities mature; provided, however, that any
Capital Stock which would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require the Company to repurchase or
redeem such Capital Stock upon the occurrence of a Change of Control or an Asset
Sale occurring prior to the final Stated Maturity of the Securities shall not
constitute Disqualified Stock if the change of control and asset sale provisions
applicable to such Capital Stock are no more favorable to the holders of such
Capital Stock than the provisions applicable to the Securities contained in
Sections 4.10 and 4.14 hereof, respectively, and such Capital Stock specifically
provides that the Company will not repurchase or redeem any such stock pursuant
to such provisions prior to the Company's repurchase of such Securities as are
required to be repurchased pursuant to Sections 4.10 and 4.14 hereof,
respectively; provided further, however, that if such Capital Stock is issued to
any employee or to any Plan for the benefit of employees of the Company or its
Subsidiaries or by any such Plan to such employees, such Capital Stock shall not
constitute Disqualified Stock solely because it may be required to be
repurchased by the Company in order to satisfy applicable statutory or
regulatory obligations or as a result of such employee's death or disability.

                  "Eligible Accounts Receivable" means the accounts receivables
(net of any reserves and allowances for doubtful accounts in accordance with
GAAP) of any Person and its Restricted Subsidiaries (determined on a
consolidated basis) that are not more than 90 days past their due date and that
were entered into in the ordinary course of business on normal payment terms as
shown on the most recent consolidated balance sheet of such Person filed with
the Commission, all in accordance with GAAP.

                  "Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).

                  "Equity Offering" means an offering for cash by the Company of
its common
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stock or Preferred Stock (other than Disqualified Stock), or options, warrants
or rights to acquire such common stock or Preferred Stock.

                  "Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.

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

                  "Exchange Securities" means the Securities issued in the
Exchange Offer pursuant to Section 2.06(f) hereof.

                  "Exchange Offer" has the meaning set forth in the applicable
Registration Rights Agreement.

                  "Exchange Offer Registration Statement" has the meaning set
forth in the applicable Registration Rights Agreement.

                  "Existing Indebtedness" means Indebtedness of the Company and
its Restricted Subsidiaries in existence on the date hereof, until such amounts
are repaid.

                  "Fair Market Value" means, with respect to any Property, the
price that could be negotiated in an arm's length transaction between a willing
seller and a willing buyer, neither of whom is under pressure or compulsion to
complete the transaction. Unless otherwise specified in this Indenture, Fair
Market Value shall be determined by the Board of Directors acting in good faith,
shall be evidenced by a resolution of the Board of Directors delivered to the
trustee, and shall be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if such
value exceeds $50.0 million.

                  "GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the date hereof.

                  "GAL Subsidiaries" means Global Access Limited, a Japanese
company, and all of its direct and indirect Subsidiaries.

                  "Global Security Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Securities issued
under this Indenture.

                  "Global Securities" means, individually and collectively, each
of the Restricted Global Securities and the Unrestricted Global Securities, in
the form of Exhibit A-1 or A-2 hereto issued in accordance with Section 2.01,
2.06(b)(iv), 2.06(d)(ii) or 2.06(f) hereof.

                  "Government Securities" means securities that are (a) direct
obligations (or certificates representing an ownership interest in such
obligations) of the United States of
<PAGE>   12
                                                                              12

America (including any agency or instrumentally thereof) of the payment of which
the full faith and credit of the United States of America is pledged, (b)
obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America or (c) obligations of a Person the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America, which, in each case, are not callable or redeemable at the
issuer's option, and shall also include a depository receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act), as custodian with respect
to any such Government Securities or a specific payment of principal of or
interest on any such Government Securities held by such custodian for the
account of the holder of such depository receipt; provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received
by the custodian in respect of the Government Securities or the specific payment
of principal of or interest on the Government Securities evidenced by such
depository receipt.

                  "Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof), of all or any part of any Indebtedness.

                  "Guarantors" means each Person that from time to time executes
a Guarantee in accordance with the provisions of this Indenture, and their
respective successors and assigns.

                  "Hedging Obligations" means, with respect to any Person, the
obligations of such Person under any Interest Rate Agreement or Currency
Agreement.

                  "HGC Subsidiaries" means Hutchison Global Crossing Holdings
Limited, a British Virgin Islands Company, and all of its direct and indirect
Subsidiaries.

                  "Holder" means a Person in whose name a Note is registered.

                  "Indebtedness" means, with respect to any Person, any
indebtedness of such Person, whether or not contingent, in respect of borrowed
money or evidenced by bonds, Securities, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof) or bankers'
acceptances or representing Capital Lease Obligations or the balance deferred
and unpaid of the purchase price of any property or representing any Hedging
Obligations, except any such balance that constitutes an accrued expense or
trade payable, if and to the extent any of the foregoing (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance sheet
of such Person prepared in accordance with GAAP, as well as all Indebtedness of
others secured by a Lien on any asset of such Person (whether or not such
Indebtedness is assumed by such Person) and, to the extent not otherwise
included, the guarantee by such Person of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date shall be (i) the
accreted value thereof, in the case of any Indebtedness issued with original
issue discount, and (ii) the principal amount thereof, together with any
interest thereon that is more than 30 days past due,
<PAGE>   13
                                                                              13

in the case of any other Indebtedness.

                  "Indenture" means this Indenture, as amended or supplemented
from time to time.

                  "Indirect Participant" means a Person who holds a beneficial
interest in a Global Security through a Participant.

                  "Initial Purchaser" shall have the meaning assigned to such
term in the applicable Offering Memorandum.

                  "Interest Rate Agreement" means, with respect to any Person,
any interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement to which such Person is a party or
beneficiary.

                  "Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees of Indebtedness or other
obligations), advances or capital contributions (excluding accounts receivable,
trade credit and commission, travel and similar advances to directors, officers
and employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or any of its Restricted Subsidiaries sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary such that, after
giving effect to any such sale or disposition, such Person is no longer a
Restricted Subsidiary of the Company or such Restricted Subsidiary, the Company
shall be deemed to have made an Investment on the date of any such sale or
disposition equal to the fair market value (or if the sale or disposition is
other than for cash, the Fair Market Value) of the Equity Interests of such
Restricted Subsidiary not sold or disposed of in an amount determined as
provided in the final paragraph of Section 4.07 hereof.

                  "Issue Date" means the applicable closing date for the sale
and original issuance of Notes of the applicable series under this Indenture.

                  "Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York or at a place of payment are
authorized by law, regulation or executive order to remain closed. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue on such payment for the intervening period.

                  "Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Securities for use by
such Holders in connection with the Exchange Offer.
<PAGE>   14
                                                                              14

                  "Letters of Credit" means one or more irrevocable direct pay
letters of credit issued by a bank or other financial institution to support the
payment of obligations of the Company.

                  "Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in, and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction); provided that in no event shall an operating lease be deemed to
constitute a Lien.

                  "Management Advances" means loans or advances made to
directors, officers or employees of the Company or any Restricted Subsidiary (i)
in respect of travel, entertainment or moving-related expenses incurred in the
ordinary course of business, (ii) in respect of moving-related expenses incurred
in connection with any closing or consolidation of any facility, or (iii) in the
ordinary course of business not exceeding $2.5 million in the aggregate at any
time outstanding.

                  "Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale or any sale
of Equity Interests permitted under Section 4.18), net of the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees, and sales commissions) and any relocation expenses
incurred as a result thereof, taxes paid or payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements), and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.

                  "Non-Recourse Debt" means Indebtedness (i) as to which neither
the Company nor any Restricted Subsidiary (a) provides any guarantee or credit
support of any kind (including any undertaking, guarantee, indemnity, agreement
or instrument that would constitute Indebtedness) or (b) is directly or
indirectly liable (as a guarantor or otherwise) and (ii) no default with respect
to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its Stated Maturity.

                  "Non-U.S. Person" means a Person who is not a U.S. Person.

                  "Note Custodian" means the Trustee, as custodian with respect
to the Securities in global form, or any successor entity thereto.

                  "Securities" has the meaning assigned to it in the preamble to
this Indenture.
<PAGE>   15
                                                                              15

                  "Notes Due 2010" has the meaning assigned to it in Section
2.01(a).

                  "Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
 .
                  "Offering Memorandum" means the Offering Memorandum, dated
_________, 2000, with respect to the Notes Due 2010, or the applicable offering
memorandum pursuant to which Securities of the same or any other series were
offered and sold.

                  "Officer" means the President, the Chief Executive Officer,
the Chief Operating Officer, the Chief Financial Officer, any Senior Vice
President, any Vice President, the Treasurer or the Secretary of the Company.

                  "Officers' Certificate" means a certificate signed by two
Officers.

                  "Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.

                  "Pari Passu Debt Securities" means any Debt Securities of the
Company or of any Guarantor which ranks pari passu in right of payment with the
Securities and any Guarantees, as applicable.

                  "Participant" means, with respect to the Depositary, Euroclear
or Clearstream Banking, a Person who has an account with the Depositary,
Euroclear or Clearstream Banking, respectively (and, with respect to The
Depository Trust Company, shall include Euroclear and Clearstream Banking).

                  "PC-1 Subsidiaries" means Pacific Crossing Ltd., a Bermuda
company, and all of its direct and indirect Subsidiaries.

                  "Permitted Business" means any business that is the same as or
related, ancillary or complementary to any of the businesses of the Company or
any of its Restricted Subsidiaries on the date hereof.

                  "Permitted Holder" means Global Crossing Ltd., Microsoft
Corporation, Softbank Corp. and their respective Affiliates.

                  "Permitted Investments" means (a) any Investment in the
Company or in any Restricted Subsidiary that is engaged in a Permitted Business;
(b) any Investment in Cash Equivalents; (c) any Investment by the Company or any
of its Restricted Subsidiaries in a Person, if as a result of such Investment
(i) such Person becomes a Restricted Subsidiary of the Company that is engaged
in a Permitted Business or (ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Restricted Subsidiary of the
Company that is
<PAGE>   16
                                                                              16

engaged in a Permitted Business; (d) any Investment that is non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.10 hereof; (e) any Investment made in a Receivables Entity in a
Qualified Receivables Transaction; (f) loans, advances or extensions of credit
to employees in the ordinary course of business; (g) obligations under Hedging
Agreements; (h) any Investment made prior to the Issue Date; (i) stock,
obligations or securities received in satisfaction of judgments in connection
with any bankruptcy proceeding or otherwise; and (j) additional Investments in
an aggregate amount not to exceed $150 million.

                  "Permitted Liens" means (i) Liens to secure Indebtedness
(other than Pari Passu Debt Securities or Subordinated Indebtedness) permitted
to be incurred under this Indenture; (ii) Liens in favor of the Company or any
Restricted Subsidiary; (iii) Liens on property of a Person existing at the time
such Person is merged with or into or consolidated with the Company or any of
its Restricted Subsidiaries; provided that such Liens were in existence prior to
the contemplation of such merger or consolidation and do not extend to any
assets other than those of the Person merged into or consolidated with the
Company or such Restricted Subsidiary; (iv) Liens on property existing at the
time of acquisition thereof by the Company or any of its Restricted
Subsidiaries, provided that such Liens were in existence prior to the
contemplation of such acquisition; (v) Liens to secure the performance of
statutory obligations, surety or appeal bonds, performance bonds or other
obligations of a like nature incurred in the ordinary course of business; (vi)
Liens existing on the date of this Indenture; (vii) Liens for taxes, assessments
or governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded, provided that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor;
(viii) Liens incurred in the ordinary course of business of the Company or any
of its Restricted Subsidiaries with respect to obligations that do not exceed
$5.0 million at any one time outstanding and that (a) are not incurred in
connection with the borrowing of money or the obtaining of advances or credit
(other than trade credit in the ordinary course of business) and (b) do not in
the aggregate materially detract from the value of the property or materially
impair the use thereof in the operation of business by the Company or such
Restricted Subsidiary; (ix) Liens with respect to assets of a Restricted
Subsidiary granted by such Restricted Subsidiary to the Company or a Restricted
Subsidiary to secure Indebtedness owing to the Company or such Restricted
Subsidiary; (x) Liens, pledges and deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of statutory obligations; (xi) Liens, pledges or deposits made to
secure the performance of tenders, bids, leases, public or statutory
obligations, sureties, stays, appeals, indemnities, performance or other similar
bonds and other obligations of like nature incurred in the ordinary course of
business (exclusive of obligations for the payment of borrowed money); (xii)
zoning restrictions, servitudes, easements, rights-of-way, restrictions and
other similar charges or encumbrances incurred in the ordinary course of
business which, in the aggregate, do not materially detract from the value of
the property subject thereto or materially interfere with the ordinary conduct
of the business of the Company or its Restricted Subsidiaries; (xiii) Liens
arising out of judgments or awards against or other court proceedings concerning
the Company or any Restricted Subsidiary with respect to which the Company or
such Restricted Subsidiary is prosecuting an appeal or proceeding for review and
the Company or such Restricted Subsidiary is maintaining
<PAGE>   17
                                                                              17

adequate reserves in accordance with GAAP; (xiv) any interest or title of a
lessor in the property subject to any lease other than a capital lease; (xv)
Liens (including extensions and renewals thereof) upon real or personal property
purchased or leased after the Issue Date; provided that (a) such Lien is created
solely for the purpose of securing Indebtedness incurred in compliance with
Section 4.09 (1) to finance the cost of the item of property or assets subject
thereto and such Lien is created prior to, at the time of or within six months
after the later of the acquisition and the incurrence of such Indebtedness or
(2) to refinance any Indebtedness previously so secured, (b) the principal
amount of the Indebtedness secured by such Lien does not exceed 100% of such
cost and (c) any such Lien shall not extend to or cover any property or assets
other than such item of property or assets; (xvi) any interest or title of a
lessor in the property subject to any Capitalized Lease or operating lease of a
Restricted Subsidiary which, in each case, is permitted under this Indenture;
(xvii) Liens encumbering customary initial deposits and margin deposits and
other Liens that are either within the general parameters customary in the
industry or incurred in the ordinary course of business, in each case, securing
Indebtedness under Hedging Agreements; and (xviii) Liens arising out of
conditional sale, title retention, consignment or similar arrangements for the
sale of goods entered into by the Company or any of its Restricted Subsidiaries
in the ordinary course of business.

                  "Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that: (i) the principal amount
(or accreted value, if applicable) of such Permitted Refinancing Indebtedness
does not exceed the principal amount of (or accreted value, if applicable), plus
accrued interest on, the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of reasonable expenses incurred
in connection therewith); (ii) such Permitted Refinancing Indebtedness has a
final maturity date later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (iii) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of payment to
the Securities, such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and is expressly subordinated in
right of payment to, the Securities on terms at least as favorable to the
Holders of the Securities as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; provided, that in no event may Indebtedness of the Company be
refinanced by means of any Indebtedness of any Restricted Subsidiary.

                  "Person" means any individual, corporation, partnership, joint
venture, limited liability company, incorporated or unincorporated association,
joint-stock company, trust, unincorporated organization or government or other
agency or political subdivision thereof or other entity of any kind.

                  "Plan" means any employee benefit plan, retirement plan,
deferred compensation plan, restricted stock plan, health, life, disability or
other insurance plan or program, employee stock purchase plan, employee stock
ownership plan, pension plan, stock
<PAGE>   18
                                                                              18

option plan or similar plan or arrangement of the Company or any Restricted
Subsidiary, or any successor plan thereof, and "Plans" shall have a correlative
meaning.

                  "Preferred Stock" of any Person means Capital Stock of such
Person of any or class or classes, however designated, that ranks prior, as to
the payment of dividends or as to the distribution of assets upon any voluntary
or involuntary liquidation, dissolution or winding-up of such Person, to shares
of Capital Stock of any other class of such Person.

                  "Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Securities issued under this Indenture
except where otherwise permitted by the provisions of this Indenture.

                  "Property" means, with respect to any Person, any interest of
such Person in any kind of property or asset, whether real, personal or mixed,
or tangible or intangible, including Capital Stock in, and other securities of,
any other Person.

                  "Purchase Money Indebtedness" means Indebtedness (including
Acquired Debt and Capital Lease Obligations, mortgage financings and purchase
money obligations) incurred for the purpose of financing all or any part of the
cost of construction, financing, installation, acquisition, lease, development,
design, engineering, financing, testing, start-up, upgrade, completion or
improvement of any assets (including licenses) used or useful in a Permitted
Business (including acquisitions of the Capital Stock of a Person that becomes a
Restricted Subsidiary to the extent of the Fair Market Value of the assets used
or useful in a Permitted Business so acquired), including any related
Securities, guarantees, collateral documents, instruments and agreements
executed in connection therewith, as the same may be amended, supplemented,
modified or restated from time to time, provided that the amount of such
Purchase Money Indebtedness does not exceed 100% of the cost of construction,
installation, acquisition, lease, development, design, engineering, financing,
testing, start-up, upgrade, completion or improvement of the assets or Capital
Stock (together with related costs and expenses).

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

                  "Qualified Receivables Transaction" means any transaction or
series of transactions that may be entered into by the Company or any of its
Subsidiaries pursuant to which the Company or any of its Subsidiaries may sell,
convey or otherwise transfer to (a) a Receivables Entity (in the case of a
transfer by the Company or any of its Subsidiaries) and (b) any other Person (in
the case of a transfer by a Receivables Entity), or may grant a security
interest in, any receivables (whether now existing or arising in the future) of
the Company or any of its Subsidiaries, and any assets related thereto
including, without limitation, all collateral securing such receivables, all
contracts and all guarantees or other obligations in respect of such
receivables, and the proceeds of such receivables.

                  "Receivables Entity" means a wholly owned Subsidiary of the
Company (or another Person in which the Company or any Subsidiary of the Company
may make an Investment and to which the Company or any Subsidiary of the Company
transfers receivables
<PAGE>   19
                                                                              19

and related assets) which engages in no activities other than in connection with
the financing of receivables and which is designated by the Board of Directors
(as provided below) as a Receivables Entity, (a) no portion of the Indebtedness
or any other Obligations (contingent or otherwise) of which (i) is guaranteed by
the Company or any Subsidiary of the Company (excluding guarantees of
Obligations (other than the principal of, and interest on, Indebtedness)
pursuant to Standard Securitization Undertakings), (ii) is recourse to or
obligates the Company or any Subsidiary of the Company in any way other than
pursuant to Standard Securitization Undertakings or (iii) subjects any property
or asset of the Company or any Subsidiary of the Company, directly or
indirectly, contingently or otherwise, to the satisfaction thereof, other than
pursuant to Standard Securitization Undertakings, (b) with which neither the
Company nor any Subsidiary of the Company has any material contract, agreement,
arrangement or understanding other than on terms no less favorable to the
Company or such Subsidiary than those that might be obtained at the time from
Persons that are not Affiliates of the Company, other than fees payable in the
ordinary course of business in connection with servicing receivables, and (c) to
which neither the Company nor any Subsidiary of the Company has any obligation
to maintain or preserve such entity's financial condition or cause such entity
to achieve certain levels of operating results. Any such designation by the
Board of Directors shall be evidenced to the Trustee by filing with the Trustee
a certified copy of the resolution of the Board of Directors giving effect to
such designation and an Officers' Certificate certifying that such designation
complied with the foregoing conditions.

                  "Related Taxes" means any taxes, charges or assessments,
including, but not limited to, sales, use, transfer, rental, ad valorem,
value-added, stamp, property, consumption, franchise, license, capital, net
worth, gross receipts, excise, occupancy, intangibles or similar taxes, charges
or assessments.

                  "Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date hereof, with respect to the Notes Due 2010, or
the applicable registration rights agreement, if any, with respect to Securities
of the same or any other series, by and among the Company and the other parties
named on the signature pages thereof, as such agreement may be amended, modified
or supplemented from time to time.

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

                  "Regulation S Global Security" means a Regulation S Temporary
Global Security or Regulation S Permanent Global Security, as appropriate.

                  "Regulation S Permanent Global Security" means a permanent
global Security in the form of Exhibit A-1 hereto bearing the Global Security
Legend and the Private Placement Legend and deposited with or on behalf of and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Regulation S
Temporary Global Security upon expiration of the Restricted Period.

                  "Regulation S Temporary Global Security" means a temporary
global Security in the form of Exhibit A-2 hereto bearing the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee, issued in a denomination
<PAGE>   20
                                                                              20

equal to the outstanding principal amount of the Securities initially sold in
reliance on Rule 903 of Regulation S.

                  "Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Administration of the Trustee (or
any successor group of the Trustee) or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.

                  "Restricted Broker-Dealer" has the meaning set forth in the
applicable Registration Rights Agreement.

                  "Restricted Definitive Note" means a Definitive Note bearing
the Private Placement Legend.

                  "Restricted Global Security" means a Global Security bearing
the Private Placement Legend.

                  "Restricted Investment" means an Investment other than a
Permitted Investment.

                  "Restricted Period" means the 40-day restricted period as
defined in Regulation S.

                  "Restricted Subsidiary" of a Person means any Subsidiary of
the referent Person that is not an Unrestricted Subsidiary; provided, however,
that the Company at its election may also designate any of its Unrestricted
Subsidiaries as a Restricted Subsidiary hereunder.

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

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

                  "Rule 903" means Rule 903 promulgated under the Securities
Act.

                  "Rule 904" means Rule 904 promulgated the Securities Act.

                  "SEC" means the Securities and Exchange Commission.

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

                  "Shelf Registration Statement" means the Shelf Registration
Statement as defined in the applicable Registration Rights Agreement.

                  "Significant Subsidiary" means any Restricted Subsidiary that
would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation
is in effect on the Issue Date, of the Company and its Restricted Subsidiaries.
<PAGE>   21
                                                                              21

                  "Special Interest" means all special interest then owing
pursuant to the applicable Registration Rights Agreement.

                  "Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Company or any
Subsidiary of the Company which are reasonably customary in securitization of
receivables transactions.

                  "Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.

                  "Subsidiary" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof) and (ii) any partnership, joint venture, limited liability
company or similar entity of which more than 50% of the capital accounts,
distribution rights, total equity and voting interests or general or limited
partnership interests, as applicable, are owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person or a combination thereof whether in the form of membership, general,
special or limited partnership or otherwise.

                  "Trade Payables" is defined to mean any accounts payable or
any other indebtedness or monetary obligation to trade creditors created,
assumed or guaranteed by the Company or any of its Restricted Subsidiaries
arising in the ordinary course of business in connection with the acquisition of
goods and services.

                  "TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date on which this Indenture is
qualified under the TIA.

                  "Treasury Rate" means, as of any date of redemption, the yield
to maturity as of such redemption date of United States Treasury securities with
a constant maturity (as compiled and published in the most recent Federal
Reserve Statistical Release H.15 (519) that has become publicly available at
least two Business Days prior to the date of redemption (or, if such Statistical
Release is no longer published, any publicly available source of similar market
data)) most nearly equal to the period from the date of redemption to _________,
2005; provided, however, that if the period from the date of redemption to
______________, 2005 is less than one year, the weekly average yield on actually
traded United States Treasury securities adjusted to a constant maturity of one
year shall be used.

                  "Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor
<PAGE>   22
                                                                              22

serving hereunder.

                  "Unrestricted Definitive Note" means one or more Definitive
Securities that do not bear and are not required to bear the Private Placement
Legend.

                  "Unrestricted Global Security" means a permanent global
Security in the form of Exhibit A-1 attached hereto that bears the Global
Security Legend and that has the "Schedule of Exchanges of Interests in the
Global Security" attached thereto, and that is deposited with or on behalf of
and registered in the name of the Depositary, representing a series of
Securities that do not bear the Private Placement Legend.

                  "Unrestricted Subsidiary" means (i) any Subsidiary of the
Company that is designated by the Board of Directors as an Unrestricted
Subsidiary pursuant to a Board Resolution; but only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt and (b) is a
Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation to maintain or preserve such
Person's financial condition or to cause such Person to achieve any specified
levels of operating results; and (c) has not guaranteed or otherwise directly or
indirectly provided credit support for any Debt Securities of the Company or any
of its Restricted Subsidiaries; provided that the Company or a Restricted
Subsidiary may pledge Capital Stock or Indebtedness of any Unrestricted
Subsidiary on a nonrecourse basis for equivalent value such that the pledgee has
no claim whatsoever against the Company or any Restricted Subsidiary other than
to obtain such Capital Stock or Indebtedness. Any such designation by the Board
of Directors shall be evidenced by filing with the Trustee a certified copy of
the Board Resolution giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
conditions and was permitted under Section 4.07 hereof. If, at any time, any
Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date (and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Company shall be in
default of such covenant). The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (i) such
Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma
basis as if such designation had occurred at the beginning of the four-quarter
reference period, and (ii) no Default or Event of Default would be in existence
following such designation.

                  "U.S. Person" means a U.S. person as defined in Rule 902(o)
under the Securities Act.

                  "Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
<PAGE>   23
                                                                              23

                  "Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.

                  "Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.

SECTION 1.02. OTHER DEFINITIONS.

<TABLE>
<CAPTION>
                                                                     Defined in
                   Term                                                Section
                   ----                                                -------

<S>                                                                  <C>
             "Additional Amounts"                                       3.09

             "Affiliate Transaction"                                    4.11

             "Asset Sale Offer"                                         4.10

             "Authentication Order"                                     2.02

             "Change in Tax Law"                                        3.08

             "Change of Control Offer"                                  4.15

             "Change of Control Payment"                                4.15

             "Change of Control Payment Date"                           4.15

             "Covenant Defeasance"                                      8.03

             "Designation"                                              4.07

             "Event of Default"                                         6.01

             "Excess Proceeds"                                          4.10

             "incur"                                                    4.09

             "Legal Defeasance"                                         8.02
</TABLE>
<PAGE>   24
                                                                              24

<TABLE>
<S>                                                                  <C>
             "Offer Amount"                                             3.11

             "Offer Period"                                             3.11

             "Paying Agent"                                             2.03

             "Permitted Indebtedness"                                   4.09

             "Purchase Date"                                            3.11

             "Registrar"                                                2.03

             "Restricted Payments"                                      4.07

             "Revocation"                                               4.07
</TABLE>

SECTION 1.03. TRUST INDENTURE ACT DEFINITIONS

                  Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.

                  The following TIA terms used in this Indenture have the
following meanings:

                  "indenture securities" means the Securities;

                  "indenture security Holder" means a Holder of a Note;

                  "indenture to be qualified" means this Indenture;

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

                  "obligor" on the Securities means the Company and any
successor obligor upon the Securities.

                  All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.

SECTION 1.04. RULES OF CONSTRUCTION.

                  Unless the context otherwise requires:

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

                  (2) an accounting term not otherwise defined has the meaning
         assigned to it
<PAGE>   25
                                                                              25

         in accordance with GAAP;

                  (3) "or" is not exclusive;

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

                  (5) provisions apply to successive events and transactions;
         and

                  (6) references to sections of or rules under the Securities
         Act shall be deemed to include substitute, replacement of successor
         sections or rules adopted by the SEC from time to time.

                            ARTICLE 2. THE SECURITIES

SECTION 2.01. FORM AND DATING.

                  (a) General.

                  The aggregate principal amount of Securities of any series
which may be authenticated and delivered under this Indenture is unlimited.

                  The Securities may be issued in one or more series. The Notes
initially include the ___% Series A Notes Due 2010 and the ____% Series B Notes
Due 2010 (together, the "Notes Due 2010").

                  The Securities and the Trustee's certificate of authentication
shall be substantially in the form of Exhibits A-1 and A-2 hereto. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule or usage or agreements to which the Company is subject. Each Note
shall be dated the date of its authentication. The Securities shall be in
denominations of $1,000 and integral multiples thereof.

                  The Securities shall be established in or pursuant to a Board
Resolution and, subject to this Section 2.01, set forth, or determined in the
manner provided, in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Securities of any
series. All Securities of any one series shall be substantially identical except
as to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to this Section 2.01) set forth,
or determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto. If any of the terms of the
series are established by action taken pursuant to a Board Resolution, a copy of
an appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate setting forth the terms of the series.

                  The terms and provisions contained in the Securities shall
constitute, and are
<PAGE>   26
                                                                              26

hereby expressly made, a part of this Indenture and the Company, the Guarantors
and the Trustee, by their execution and delivery of this Indenture, expressly
agree to such terms and provisions and to be bound thereby. However, to the
extent any provision of any Note conflicts with the express provisions of this
Indenture, the provisions of this Indenture shall govern and be controlling.

                  (b) Global Securities.

                  Securities issued in global form shall be substantially in the
form of Exhibits A-1 or A-2 attached hereto (including the Global Security
Legend thereon and the "Schedule of Exchanges of Interests in the Global
Security" attached thereto). Securities issued in definitive form shall be
substantially in the form of Exhibit A-1 attached hereto (but without the Global
Security Legend thereon and without the "Schedule of Exchanges of Interests in
the Global Security" attached thereto). Each Global Security shall represent
such of the outstanding Securities as shall be specified therein and each shall
provide that it shall represent the aggregate principal amount of outstanding
Securities from time to time endorsed thereon and that the aggregate principal
amount of outstanding Securities represented thereby may from time to time be
reduced or increased, as appropriate, to reflect exchanges and redemptions. Any
endorsement of a Global Security to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Securities represented
thereby shall be made by the Trustee or the Security Custodian, at the direction
of the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.

                  (c) Temporary Global Securities.

                  Securities offered and sold in reliance on Regulation S shall
be issued initially in the form of the Regulation S Temporary Global Security,
which shall be deposited on behalf of the purchasers of the Securities
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Clearstream Banking, duly executed by the Company and authenticated
by the Trustee as hereinafter provided. The Restricted Period shall be
terminated upon the receipt by the Trustee of (i) a written certificate from the
Depositary, together with copies of certificates from Euroclear and Clearstream
Banking certifying that they have received certification of non-United States
beneficial ownership of 100% of the aggregate principal amount of the Regulation
S Temporary Global Security (except to the extent of any beneficial owners
thereof who acquired an interest therein during the Restricted Period pursuant
to another exemption from registration under the Securities Act and who will
take delivery of a beneficial ownership interest in a 144A Global Security
bearing a Private Placement Legend, all as contemplated by Section 2.06(a)(ii)
hereof), and (ii) an Officers' Certificate from the Company. Following the
termination of the Restricted Period, beneficial interests in the Regulation S
Temporary Global Security shall be exchanged for beneficial interests in
Regulation S Permanent Global Securities pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global
Securities, the Trustee shall cancel the Regulation S Temporary Global Security.
The aggregate principal amount of the Regulation S Temporary Global Security and
the Regulation S Permanent Global Securities may from time to time be increased
or decreased by
<PAGE>   27
                                                                              27

adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.

                  (d) Euroclear and Clearstream Banking Procedures Applicable.

                  The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Clearstream Banking" and "Customer Handbook" of
Clearstream Banking shall be applicable to transfers of beneficial interests in
the Regulation S Temporary Global Security and the Regulation S Permanent Global
Securities that are held by Participants through Euroclear or Clearstream
Banking.

SECTION 2.02. EXECUTION AND AUTHENTICATION.

                  Two Officers shall sign the Securities for the Company by
manual or facsimile signature. It is not necessary for the Company's seal to be
impressed, affixed, imprinted or reproduced on the Securities.

                  If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.

                  A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.

                  The Trustee shall, upon a written order of the Company signed
by two Officers (an "Authentication Order"), authenticate Securities for
original issue up to the aggregate principal amount stated in paragraph 4 of the
Securities. The aggregate principal amount of Securities outstanding at any time
may not exceed such amount except as provided in Section 2.07 hereof.

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

SECTION 2.03. REGISTRAR AND PAYING AGENT.

                  The Company shall maintain an office or agency where
Securities of each series may be presented for registration of transfer or for
exchange ("Registrar") and an office or agency where Securities of each series
may be presented for payment ("Paying Agent"). The Registrar for each series of
Securities shall keep a register of the Securities of such series and of their
transfer and exchange. The Company may appoint one or more co-Registrars and one
or more additional paying agents for each series of Securities. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The
<PAGE>   28
                                                                              28

Company may change any Paying Agent or Registrar without notice to any Holder.
The Company shall notify the Trustee in writing of the name and address of any
Agent not a party to this Indenture. If the Company fails to appoint or maintain
another entity as Registrar or Paying Agent, the Trustee shall act as such. The
Company or any of its Subsidiaries may act as Paying Agent or Registrar.

                  The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Securities.

                  The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Securities.

                  The Trustee is authorized to enter into a letter of
representations with DTC in the form provided to the Trustee by the Company and
to act in accordance with such letter.

SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.

                  The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium or Special Interest, if any, or interest on the
Securities, and will notify the Trustee of any default by the Company in making
any such payment. While any such default continues, the Trustee may require a
Paying Agent to pay all money held by it to the Trustee. The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Securities.

SECTION 2.05. HOLDER LISTS.

                  The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders, separately by series, and shall otherwise comply with
TIA Section 312(a). If the Trustee is not the Registrar, the Company shall
furnish to the Trustee at least seven Business Days before each interest payment
date and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of the names
and addresses of the Holders of Securities, separately by series, and the
Company shall otherwise comply with TIA Section 312(a).

SECTION 2.06. TRANSFER AND EXCHANGE.

                  (a) Transfer and Exchange of Global Securities.

                  A Global Security may not be transferred as a whole except by
the Depositary to a nominee of the Depositary, by a nominee of the Depositary to
the Depositary or to another
<PAGE>   29
                                                                              29

nominee of the Depositary, the Depositary or any such nominee to a successor
Depositary or a nominee of such successor Depositary. All Global Securities of a
series will be exchanged by the Company for Definitive Securities of the same
series if (i) the Company delivers to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that it is no
longer a clearing agency registered under the Exchange Act and, in either case,
a successor Depositary is not appointed by the Company within 120 days after the
date of such notice from the Depositary or (ii) the Company in its sole
discretion determines that the Global Securities of such series (in whole but
not in part) should be exchanged for Definitive Securities and delivers a
written notice to such effect to the Trustee; provided that in no event shall a
Regulation S Temporary Global Security be exchanged by the Company for
Definitive Securities prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates determined by the Company
to be required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act. Upon
the occurrence of either of the preceding events in (i) or (ii) above,
Definitive Securities shall be issued in such names as the Depositary shall
instruct the Trustee. Global Securities also may be exchanged or replaced, in
whole or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Security of
the same series or any portion thereof, pursuant to this Section 2.06 or Section
2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and
shall be, a Global Security. A Global Security may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Security may be transferred and exchanged as provided in
Section 2.06(b),(c) or (f) hereof.

                  (b) Transfer and Exchange of Beneficial Interests in the
Global Securities.

                  The transfer and exchange of beneficial interests in the
Global Securities shall be effected through the Depositary, in accordance with
the provisions of this Indenture and the Applicable Procedures. Beneficial
interests in the Restricted Global Securities shall be subject to restrictions
on transfer comparable to those set forth herein to the extent required by the
Securities Act. Transfers of beneficial interests in the Global Securities also
shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:

                  (i) Transfer of Beneficial Interests in the Same Global
         Security. Beneficial interests in any Restricted Global Security may be
         transferred to Persons who take delivery thereof in the form of a
         beneficial interest in the same Restricted Global Security in
         accordance with the transfer restrictions set forth in the Private
         Placement Legend; provided, however, that prior to the expiration of
         the Restricted Period, transfers of beneficial interests in the
         Temporary Regulation S Global Securities may not be made to a U.S.
         Person or for the account or benefit of a U.S. Person (other than an
         Initial Purchaser). Beneficial interests in any Unrestricted Global
         Security may be transferred to Persons who take delivery thereof in the
         form of a beneficial interest in an Unrestricted Global Security of the
         same series. No written orders or instructions shall be required to be
         delivered to the Registrar to effect the transfers described in this
         Section 2.06(b)(i).

                  (ii) All Other Transfers and Exchanges of Beneficial Interests
         in Global
<PAGE>   30
                                                                              30

         Securities. In connection with all transfers and exchanges of
         beneficial interests that are not subject to Section 2.06(b)(i) above,
         the transferor of such beneficial interest must deliver to the
         Depositary either (A) (1) a written order from a Participant or an
         Indirect Participant given to the Depositary in accordance with the
         Applicable Procedures directing the Depositary to credit or cause to be
         credited a beneficial interest in another Global Security of the same
         series in an amount equal to the beneficial interest to be transferred
         or exchanged and (2) instructions given in accordance with the
         Applicable Procedures containing information regarding the Participant
         account to be credited with such increase or (B) (1) a written order
         from a Participant or an Indirect Participant given to the Depositary
         in accordance with the Applicable Procedures directing the Depositary
         to cause to be issued a Definitive Note of the same series in an amount
         equal to the beneficial interest to be transferred or exchanged and (2)
         instructions given by the Depositary to the Registrar containing
         information regarding the Person in whose name such Definitive Note
         shall be registered to effect the transfer or exchange referred to in
         (1) above, provided that in no event shall Definitive Securities be
         issued upon the transfer or exchange of beneficial interests in a
         Regulation S Temporary Global Security prior to (x) the expiration of
         the Restricted Period and (y) the receipt by the Registrar of any
         certificates determined by the Company to be required pursuant to Rule
         903 under the Securities Act. Upon consummation of an Exchange Offer by
         the Company in accordance with Section 2.06(f) hereof, the requirements
         of this Section 2.06(b)(ii) shall be deemed to have been satisfied upon
         receipt by the Registrar of the instructions contained in the Letter of
         Transmittal delivered by the Holder of such beneficial interests in the
         Restricted Global Securities. Upon satisfaction of all of the
         requirements for transfer or exchange of beneficial interests in Global
         Securities contained in this Indenture and the Securities or otherwise
         applicable under the Securities Act, the Trustee shall adjust the
         principal amount of the relevant Global Security(ies) pursuant to
         Section 2.06(h) hereof.

                  (iii) Transfer of Beneficial Interests to Another Restricted
         Global Security. A beneficial interest in any Restricted Global
         Security may be transferred to a Person who takes delivery thereof in
         the form of a beneficial interest in another Restricted Global Security
         of the same series if the transfer complies with the requirements of
         Section 2.06(b)(ii) above and the Registrar receives the
         following:

                           (A) if the transferee will take delivery in the form
                  of a beneficial interest in a 144A Global Security of the same
                  series, then the transferor must deliver a certificate in the
                  form of Exhibit B hereto, including the certifications in item
                  (1) thereof; and

                           (B) if the transferee will take delivery in the form
                  of a beneficial interest in a Regulation S Temporary Global
                  Security of the same series or a Regulation S Global Security
                  of the same series, then the transferor must deliver a
                  certificate in the form of Exhibit B hereto, including the
                  certifications in item (2) thereof.

                  (iv) Transfer and Exchange of Beneficial Interests in a
         Restricted Global
<PAGE>   31
                                                                              31

         Security for Beneficial Interests in the Unrestricted Global Security.
         A beneficial interest in any Restricted Global Security may be
         exchanged by any holder thereof for a beneficial interest in an
         Unrestricted Global Security of the same series or transferred to a
         Person who takes delivery thereof in the form of a beneficial interest
         in an Unrestricted Global Security of the same series if the exchange
         or transfer complies with the requirements of Section 2.06(b)(ii) above
         and:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of the beneficial interest to be
                  transferred, in the case of an exchange, or the transferee, in
                  the case of a transfer, certifies in the applicable Letter of
                  Transmittal or via the Depositary's book-entry system that it
                  is not (1) a broker-dealer, (2) a Person participating in the
                  distribution of the Exchange Securities or (3) a Person who is
                  an affiliate (as defined in Rule 144) of the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                           (C) such transfer is effected by a Restricted
                  Broker-Dealer pursuant to the Exchange Offer Registration
                  Statement in accordance with the Registration Rights
                  Agreement; or

                           (D) the Registrar receives the following:

                                    (1) if the holder of such beneficial
                  interest in a Restricted Global Security proposes to exchange
                  such beneficial interest for a beneficial interest in an
                  Unrestricted Global Security of the same series, a certificate
                  from such holder in the form of Exhibit C hereto, including
                  the certifications in item (1)(a) thereof; or

                                    (2) if the holder of such beneficial
                  interest in a Restricted Global Security proposes to transfer
                  such beneficial interest to a Person who shall take delivery
                  thereof in the form of a beneficial interest in an
                  Unrestricted Global Security of the same series, a certificate
                  from such holder in the form of Exhibit B hereto, including
                  the certifications in item (4) thereof;

         and, in each such case set forth in this subparagraph (D), if the
         Registrar so requests or if the Applicable Procedures so require, an
         Opinion of Counsel in form reasonably acceptable to the Registrar to
         the effect that such exchange or transfer is in compliance with the
         Securities Act and that the restrictions on transfer contained herein
         and in the Private Placement Legend are no longer required in order to
         maintain compliance with the Securities Act.

                  If any such transfer is effected pursuant to subparagraph (B)
or (D) above at a time when an Unrestricted Global Security has not yet been
issued, the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the
<PAGE>   32
                                                                              32

Trustee shall authenticate one or more Unrestricted Global Securities of the
same series in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to subparagraph (B) or (D)
above.

                  Beneficial interests in an Unrestricted Global Security cannot
be exchanged for, or transferred to Persons who take delivery thereof in the
form of, a beneficial interest in a Restricted Global Security.

                  (c) Transfer or Exchange of Beneficial Interests for
Definitive Securities.

                  (i) Beneficial Interests in Restricted Global Securities to
         Restricted Definitive Securities. If any holder of a beneficial
         interest in a Restricted Global Security proposes to exchange such
         beneficial interest for a Restricted Definitive Note of the same series
         or to transfer such beneficial interest to a Person who takes delivery
         thereof in the form of a Restricted Definitive Note of the same series,
         then, upon receipt by the Registrar of the following documentation:

                           (A) if the holder of such beneficial interest in a
                  Restricted Global Security proposes to exchange such
                  beneficial interest for a Restricted Definitive Note of the
                  same series, a certificate from such holder in the form of
                  Exhibit C hereto, including the certifications in item (2)(a)
                  thereof;

                           (B) if such beneficial interest is being transferred
                  to a QIB in accordance with Rule 144A, a certificate to the
                  effect set forth in Exhibit B hereto, including the
                  certifications in item (1) thereof;

                           (C) if such beneficial interest is being transferred
                  to a Non-U.S. Person in an offshore transaction in accordance
                  with Rule 903 or Rule 904, a certificate to the effect set
                  forth in Exhibit B hereto, including the certifications in
                  item (2) thereof;

                           (D) if such beneficial interest is being transferred
                  pursuant to an exemption from the registration requirements of
                  the Securities Act in accordance with Rule 144, a certificate
                  to the effect set forth in Exhibit B hereto, including the
                  certifications in item (3)(a) thereof;

                           (E) if such beneficial interest is being transferred
                  to the Company or any of its Subsidiaries, a certificate to
                  the effect set forth in Exhibit B hereto, including the
                  certifications in item (3)(b) thereof; or

                           (F) if such beneficial interest is being transferred
                  pursuant to an effective registration statement under the
                  Securities Act, a certificate to the effect set forth in
                  Exhibit B hereto, including the certifications in item (3)(c)
                  thereof,

         the Trustee shall cause the aggregate principal amount of the
         applicable Global Security to be reduced accordingly pursuant to
         Section 2.06(h) hereof, and the Company shall execute and the Trustee
         shall authenticate and deliver to the Person designated in the
<PAGE>   33
                                                                              33

         instructions a Definitive Note of the same series in the appropriate
         principal amount. Any Definitive Note issued in exchange for a
         beneficial interest in a Restricted Global Security pursuant to this
         Section 2.06(c) shall be registered in such name or names and in such
         authorized denomination or denominations as the holder of such
         beneficial interest shall instruct the Registrar through instructions
         from the Depositary and the Participant or Indirect Participant. The
         Trustee shall make available for delivery such Definitive Securities to
         the Persons in whose names such Securities are so registered. Any
         Definitive Note issued in exchange for a beneficial interest in a
         Restricted Global Security of the same series pursuant to this Section
         2.06(c)(i) shall bear the Private Placement Legend and shall be subject
         to all restrictions on transfer contained therein.

                  (ii) Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof, a
         beneficial interest in a Regulation S Temporary Global Security may not
         be exchanged for a Definitive Note or transferred to a Person who takes
         delivery thereof in the form of a Definitive Note prior to (x) the
         expiration of the Restricted Period and (y) the receipt by the
         Registrar of any certificates determined by the Company to be required
         pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act, except in
         the case of a transfer pursuant to an exemption from the registration
         requirements of the Securities Act other than Rule 903 or Rule 904.

                  (iii) Beneficial Interests in Restricted Global Securities to
         Unrestricted Definitive Securities. A holder of a beneficial interest
         in a Restricted Global Security may exchange such beneficial interest
         for an Unrestricted Definitive Note of the same series or may transfer
         such beneficial interest to a Person who takes delivery thereof in the
         form of an Unrestricted Definitive Note of the same series only if:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of such beneficial interest, in the
                  case of an exchange, or the transferee, in the case of a
                  transfer, certifies in the applicable Letter of Transmittal
                  that it is not (1) a broker-dealer, (2) a Person participating
                  in the distribution of the Exchange Securities or (3) a Person
                  who is an affiliate (as defined in Rule 144) of the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                           (C) such transfer is effected by a Restricted
                  Broker-Dealer pursuant to the Exchange Offer Registration
                  Statement in accordance with the Registration Rights
                  Agreement; or

                           (D) the Registrar receives the following:

                                    (1) if the holder of such beneficial
                  interest in a Restricted Global Security proposes to exchange
                  such beneficial interest for a Definitive Note of the same
                  series that does not bear the Private Placement Legend, a
<PAGE>   34
                                                                              34

                  certificate from such holder in the form of Exhibit C hereto,
                  including the certifications in item (1)(b) thereof; or

                                    (2) if the holder of such beneficial
                  interest in a Restricted Global Security proposes to transfer
                  such beneficial interest to a Person who shall take delivery
                  thereof in the form of a Definitive Note of the same series
                  that does not bear the Private Placement Legend, a certificate
                  from such holder in the form of Exhibit B hereto, including
                  the certifications in item (4) thereof;

         and, in each such case set forth in this subparagraph (D), if the
         Registrar so requests or if the Applicable Procedures so require, an
         Opinion of Counsel in form reasonably acceptable to the Registrar to
         the effect that such exchange or transfer is in compliance with the
         Securities Act and that the restrictions on transfer contained herein
         and in the Private Placement Legend are no longer required in order to
         maintain compliance with the Securities Act.

                  (iv) Beneficial Interests in Unrestricted Global Securities to
         Unrestricted Definitive Securities. If any holder of a beneficial
         interest in an Unrestricted Global Security proposes to exchange such
         beneficial interest for a Definitive Note of the same series or to
         transfer such beneficial interest to a Person who takes delivery
         thereof in the form of a Definitive Note of the same series, then, upon
         satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof,
         the Trustee shall cause the aggregate principal amount of the
         applicable Global Security to be reduced accordingly pursuant to
         Section 2.06(h) hereof, and the Company shall execute and the Trustee
         shall authenticate and make available for delivery to the Person
         designated in the instructions a Definitive Note of the same series in
         the appropriate principal amount. Any Definitive Note issued in
         exchange for a beneficial interest pursuant to this Section
         2.06(c)(iii) shall be registered in such name or names and in such
         authorized denomination or denominations as the holder of such
         beneficial interest shall instruct the Registrar through instructions
         from the Depositary and the Participant or Indirect Participant. The
         Trustee shall make available for delivery such Definitive Securities to
         the Persons in whose names such Securities are so registered. Any
         Definitive Note issued in exchange for a beneficial interest pursuant
         to this Section 2.06(c)(iii) shall not bear the Private Placement
         Legend.

                  (d) Transfer and Exchange of Definitive Securities for
Beneficial Interests.

                  (i) Restricted Definitive Securities to Beneficial Interests
         in Restricted Global Securities. If any Holder of a Restricted
         Definitive Note proposes to exchange such Note for a beneficial
         interest in a Restricted Global Security of the same series or to
         transfer such Restricted Definitive Securities to a Person who takes
         delivery thereof in the form of a beneficial interest in a Restricted
         Global Security of the same series, then, upon receipt by the Registrar
         of the following documentation:

                           (A) if the Holder of such Restricted Definitive Note
                  proposes to exchange such Note for a beneficial interest in a
                  Restricted Global Security of the same series, a certificate
                  from such Holder in the form of Exhibit C hereto, including
                  the
<PAGE>   35
                                                                              35

                  certifications in item (2)(b) thereof;

                           (B) if such Restricted Definitive Note is being
                  transferred to a QIB in accordance with Rule 144A, a
                  certificate to the effect set forth in Exhibit B hereto,
                  including the certifications in item (1) thereof;

                           (C) if such Restricted Definitive Note is being
                  transferred to a Non-U.S. Person in an offshore transaction in
                  accordance with Rule 903 or Rule 904, a certificate to the
                  effect set forth in Exhibit B hereto, including the
                  certifications in item (2) thereof;

                           (D) if such Restricted Definitive Note is being
                  transferred pursuant to an exemption from the registration
                  requirements of the Securities Act in accordance with Rule
                  144, a certificate to the effect set forth in Exhibit B
                  hereto, including the certifications in item (3)(a) thereof;

                           (E) if such Restricted Definitive Note is being
                  transferred to the Company or any of its Subsidiaries, a
                  certificate to the effect set forth in Exhibit B hereto,
                  including the certifications in item (3)(b) thereof; or

                           (F) if such Restricted Definitive Note is being
                  transferred pursuant to an effective registration statement
                  under the Securities Act, a certificate to the effect set
                  forth in Exhibit B hereto, including the certifications in
                  item (3)(c) thereof,

         the Trustee shall cancel the Restricted Definitive Note, increase or
         cause to be increased the aggregate principal amount of, in the case of
         clause (A) above, the appropriate Restricted Global Security of the
         same series, in the case of clause (B) above, the 144A Global Security
         of the same series, and in the case of clause (C) above, the Regulation
         S Global Security of the same series.

                  (ii) Restricted Definitive Securities to Beneficial Interests
         in Unrestricted Global Securities. A Holder of a Restricted Definitive
         Note may exchange such Note for a beneficial interest in an
         Unrestricted Global Security of the same series or transfer such
         Restricted Definitive Note to a Person who takes delivery thereof in
         the form of a beneficial interest in an Unrestricted Global Security of
         the same series only if:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the Holder, in the case of an exchange, or the
                  transferee, in the case of a transfer, certifies in the
                  applicable Letter of Transmittal that it is not (1) a
                  broker-dealer, (2) a Person participating in the distribution
                  of the Exchange Securities or (3) a Person who is an affiliate
                  (as defined in Rule 144) of the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;
<PAGE>   36

                                                                              36

                      (C) such transfer is effected by a Restricted
              Broker-Dealer pursuant to the Exchange Offer Registration
              Statement in accordance with the Registration Rights Agreement; or

                      (D) the Registrar receives the following:

                               (1) if the Holder of such Definitive Securities
              proposes to exchange such Securities for a beneficial interest in
              the Unrestricted Global Security of the same series, a certificate
              from such Holder in the form of Exhibit C hereto, including the
              certifications in item (1)(c) thereof; or

                               (2) if the Holder of such Definitive Securities
              proposes to transfer such Securities to a Person who shall take
              delivery thereof in the form of a beneficial interest in the
              Unrestricted Global Security of the same series, a certificate
              from such Holder in the form of Exhibit B hereto, including the
              certifications in item (4) thereof;

     and, in each such case set forth in this subparagraph (D), if the Registrar
     so requests or if the Applicable Procedures so require, an Opinion of
     Counsel in form reasonably acceptable to the Registrar to the effect that
     such exchange or transfer is in compliance with the Securities Act and that
     the restrictions on transfer contained herein and in the Private Placement
     Legend are no longer required in order to maintain compliance with the
     Securities Act.

     Upon satisfaction of the conditions of any of the subparagraphs in this
     Section 2.06(d)(ii), the Trustee shall cancel the Definitive Securities and
     increase or cause to be increased the aggregate principal amount of the
     Unrestricted Global Security of the same series.

              (iii) Unrestricted Definitive Securities to Beneficial Interests
     in Unrestricted Global Securities. A Holder of an Unrestricted Definitive
     Note may exchange such Note for a beneficial interest in an Unrestricted
     Global Security of the same series or transfer such Definitive Securities
     to a Person who takes delivery thereof in the form of a beneficial interest
     in an Unrestricted Global Security of the same series at any time. Upon
     receipt of a request for such an exchange or transfer, the Trustee shall
     cancel the applicable Unrestricted Definitive Note and increase or cause to
     be increased the aggregate principal amount of one of the Unrestricted
     Global Securities of the same series.

              If any such exchange or transfer from a Definitive Note to a
beneficial interest in a Global Security of the same series is effected pursuant
to subparagraphs (ii)(B), (ii)(D) or (iii) above at a time when an Unrestricted
Global Security has not yet been issued, the Company shall issue and, upon
receipt of an Authentication Order in accordance with Section 2.02 hereof, the
Trustee shall authenticate one or more Unrestricted Global Securities of the
same series in an aggregate principal amount equal to the principal amount of
Definitive Securities so transferred.

              (e) Transfer and Exchange of Definitive Securities for Definitive
Securities.
<PAGE>   37
                                                                              37
              Upon request by a Holder of Definitive Securities and such
Holder's compliance with the provisions of this Section 2.06(e), the Registrar
shall register the transfer or exchange of Definitive Securities. Prior to such
registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Definitive Securities duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to the
Registrar duly executed by such Holder or by his attorney, duly authorized in
writing. In addition, the requesting Holder shall provide any additional
certifications, documents and information, as applicable, required pursuant to
the following provisions of this Section 2.06(e).

              (i) Restricted Definitive Securities to Restricted Definitive
     Securities. Any Restricted Definitive Note may be transferred to and
     registered in the name of Persons who take delivery thereof in the form of
     a Restricted Definitive Note of the same series if the Registrar receives
     the following:

                      (A) if the transfer will be made pursuant to Rule 144A,
              then the transferor must deliver a certificate in the form of
              Exhibit B hereto, including the certifications in item (1)
              thereof;

                      (B) if the transfer will be made pursuant to Rule 903 or
              Rule 904, then the transferor must deliver a certificate in the
              form of Exhibit B hereto, including the certifications in item (2)
              thereof; and

                      (C) if the transfer will be made pursuant to any other
              exemption from the registration requirements of the Securities
              Act, then the transferor must deliver a certificate in the form of
              Exhibit B hereto, including the certifications, certificates and
              Opinion of Counsel required by item (3) thereof, if applicable.

              (ii) Restricted Definitive Securities to Unrestricted Definitive
     Securities. Any Restricted Definitive Note may be exchanged by the Holder
     thereof for an Unrestricted Definitive Note of the same series or
     transferred to a Person or Persons who take delivery thereof in the form of
     an Unrestricted Definitive Note of the same series if:

                      (A) such exchange or transfer is effected pursuant to the
              Exchange Offer in accordance with the Registration Rights
              Agreement and the Holder, in the case of an exchange, or the
              transferee, in the case of a transfer, certifies in the applicable
              Letter of Transmittal that it is not (1) a broker-dealer, (2) a
              Person participating in the distribution of the Exchange
              Securities or (3) a Person who is an affiliate (as defined in Rule
              144) of the Company;

                      (B) any such transfer is effected pursuant to the Shelf
              Registration Statement in accordance with the Registration Rights
              Agreement;

                      (C) any such transfer is effected by a Restricted
              Broker-Dealer pursuant to the Exchange Offer Registration
              Statement in accordance with the Registration Rights Agreement; or

<PAGE>   38
                                                                              38
                      (D) the Registrar receives the following:

                          (1) if the Holder of such Restricted Definitive
                 Securities proposes to exchange such Securities for an
                 Unrestricted Definitive Note of the same series, a certificate
                 from such Holder in the form of Exhibit C hereto, including the
                 certifications in item (1)(d) thereof; or

                          (2) if the Holder of such Restricted Definitive
                 Securities proposes to transfer such Securities to a Person who
                 shall take delivery thereof in the form of an Unrestricted
                 Definitive Note of the same series, a certificate from such
                 Holder in the form of Exhibit B hereto, including the
                 certifications in item (4) thereof;

                 and, in each such case set forth in this subparagraph (D), if
                 the Registrar so requests, an Opinion of Counsel in form
                 reasonably acceptable to the Company to the effect that such
                 exchange or transfer is in compliance with the Securities Act
                 and that the restrictions on transfer contained herein and in
                 the Private Placement Legend are no longer required in order to
                 maintain compliance with the Securities Act.

              (iii) Unrestricted Definitive Securities to Unrestricted
     Definitive Securities. A Holder of Unrestricted Definitive Securities may
     transfer such Securities to a Person who takes delivery thereof in the form
     of an Unrestricted Definitive Note of the same series. Upon receipt of a
     request to register such a transfer, the Registrar shall register the
     Unrestricted Definitive Securities pursuant to the instructions from the
     Holder thereof.

              (f)  Exchange Offer.

              Upon the occurrence of the Exchange Offer in accordance with the
Registration Rights Agreement, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate (i) one or more Unrestricted Global Securities in an aggregate
principal amount equal to the principal amount of the beneficial interests in
the Restricted Global Securities of the same series tendered for acceptance by
Persons that certify in the applicable Letters of Transmittal or via the
Depositary's book-entry system that (x) they are not broker-dealers, (y) they
are not participating in a distribution of the Exchange Securities and (z) they
are not affiliates (as defined in Rule 144) of the Company, and accepted for
exchange in the Exchange Offer and (ii) Definitive Securities in an aggregate
principal amount equal to the principal amount of the Restricted Definitive
Securities of the same series accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Securities, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Securities to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and make available for delivery to the Persons designated by the
Holders of Definitive Securities so accepted Definitive Securities in the
appropriate principal amount.

              (g)  Legends.
<PAGE>   39
                                                                              39
              The following legends shall appear on the face of all Global
Securities and Definitive Securities issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.

              (i)     Private Placement Legend.

                      (A) Except as permitted by subparagraph (B) below, each
              Global Security and each Definitive Note (and all Securities
              issued in exchange therefor or substitution thereof) shall bear
              the legend in substantially the following form:

     "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
     SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT
     BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND
     ANNIVERSARY OF THE ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR
     (Y) BY ANY HOLDER THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING
     THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER
     THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR
     RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A
     PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
     BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS
     BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE
     TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY),
     (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
     PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, (4) PURSUANT
     TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING
     OF REGULATION S UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE
     REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
     WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE
     HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE
     BENEFIT OF THE COMPANY THAT IT IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
     THE MEANING OF RULE 144A."

                      (B) Notwithstanding the foregoing, any Global Security or
              Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(ii),
              (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this
              Section 2.06 (and all Securities issued in exchange therefor or
              substitution thereof) shall not bear the Private Placement Legend.

          (ii) Global Security Legends. Each Global Security shall bear legends
     in substantially the following form:

     "THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
     INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE

<PAGE>   40
                                                                              40
     BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
     PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH
     NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE
     INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN
     PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL
     SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
     SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE
     TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
     COMPANY.

     UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
     DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
     THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
     DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
     DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF
     SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
     AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET,
     NEW YORK, NEW YORK) ("DTC") TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
     TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
     THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
     AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
     SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
     DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
     TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
     CO., HAS AN INTEREST HEREIN."

              (iii) Regulation S Temporary Global Security Legend. The
     Regulation S Temporary Global Security shall bear a legend in substantially
     the following form:

     "THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL SECURITY, AND
     THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
     SECURITIES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER
     THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL
     SECURITY SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON."

              (iv) Original Issue Discount Legend. Each Global Security or
Definitive Note issued in respect of Securities issued with original issue
discount shall bear a legend in the following form:

     "FOR THE PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
     CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE
     DISCOUNT; FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS SECURITY, THE ISSUE
     PRICE IS $__________, THE AMOUNT OF ORIGINAL ISSUE

<PAGE>   41
                                                                              41

     DISCOUNT IS $_________, THE ISSUE DATE IS _______, AND THE YIELD TO
     MATURITY ON THE ISSUE DATE IS ____% PER ANNUM."

              (h)  Cancellation and/or Adjustment of Global Securities.

              At such time as all beneficial interests in a particular Global
Security have been exchanged for Definitive Securities of the same series or a
particular Global Security has been redeemed, repurchased or canceled in whole
and not in part, each such Global Security shall be returned to or retained and
canceled by the Trustee in accordance with Section 2.11 hereof. At any time
prior to such cancellation, if any beneficial interest in a Global Security is
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Security of the same series or
for Definitive Securities of the same series, the principal amount of Securities
represented by such Global Security shall be reduced accordingly and an
endorsement shall be made on such Global Security by the Trustee or by the
Depositary at the direction of the Trustee to reflect such reduction; and if the
beneficial interest is being exchanged for or transferred to a Person who will
take delivery thereof in the form of a beneficial interest in another Global
Security of the same series, such other Global Security shall be increased
accordingly and an endorsement shall be made on such Global Security by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
increase.

              (i)  General Provisions Relating to Transfers and Exchanges.

              (i) To permit registrations of transfers and exchanges, the
     Company shall execute and the Trustee shall authenticate Global Securities
     and Definitive Securities upon the Company's order or at the Registrar's
     request.

              (ii) No service charge shall be made to a holder of a beneficial
     interest in a Global Security or to a Holder of a Definitive Note for any
     registration of transfer or exchange, but the Company may require payment
     of a sum sufficient to cover any transfer tax or similar governmental
     charge payable in connection therewith (other than any such transfer taxes
     or similar governmental charge payable upon exchange or transfer pursuant
     to Sections 2.10, 3.06, 3.11, 4.10, 4.15 and 9.05 hereof).

              (iii) The Registrar shall not be required to register the transfer
     of or exchange any Note selected for redemption in whole or in part, except
     the unredeemed portion of any Note being redeemed in part.

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

              (v) The Company shall not be required (A) to issue, to register
     the transfer of or to exchange any Securities during a period beginning at
     the opening of business 15 days before the day of the mailing of notice of
     redemption under Section 3.02 hereof and ending
<PAGE>   42
                                                                              42

     at the close of business on such day, (B) to register the transfer of or to
     exchange any Note so selected for redemption in whole or in part, except
     the unredeemed portion of any Note being redeemed in part or (c) to
     register the transfer of or to exchange a Note between a record date and
     the next succeeding Interest Payment Date.

              (vi) Prior to due presentment for the registration of a transfer
     of any Note, the Trustee, any Agent and the Company may deem and treat the
     Person in whose name any Note is registered as the absolute owner of such
     Note for the purpose of receiving payment of principal of and interest on
     such Securities and for all other purposes, and none of the Trustee, any
     Agent or the Company shall be affected by notice to the contrary.

              (vii) The Trustee shall authenticate Global Securities and
     Definitive Securities in accordance with the provisions of Section 2.02
     hereof.

              (viii) All certifications, certificates and Opinions of Counsel
     required to be submitted to the Registrar pursuant to this Section 2.06 to
     effect a registration of transfer or exchange may be submitted by
     facsimile.

              (ix) Each Holder of a Note agrees to indemnify the Trustee and the
     Registrar against any liability that may result from the transfer, exchange
     or assignment of such Holder's Note in violation of any provision of this
     Indenture and/or applicable United States federal or state securities law.

              (x) Neither the Trustee nor the Registrar shall have any
     obligation or duty to monitor, determine or inquire as to compliance with
     any restrictions on transfer imposed under this Indenture or under
     applicable law with respect to any transfer of any interest in any Note
     (including any transfers between or among Participants or beneficial owners
     of interests in any Global Security) other than to require delivery of such
     certificates and other documentation or evidence as are expressly required
     by, and to do so if and when expressly required by the terms of, this
     Indenture, and to examine the same to determine substantial compliance as
     to form with the express requirements hereof.

SECTION 2.07.  REPLACEMENT SECURITIES.

              If any mutilated Note is surrendered to the Trustee or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee, upon receipt of
an Authentication Order, shall authenticate a replacement Note of the same
series if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note.

              Every replacement Note is an additional obligation of the Company
and shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities of the same series duly issued
hereunder.
<PAGE>   43
                                                                              43

SECTION 2.08.  OUTSTANDING SECURITIES.

              The Securities of any series outstanding at any time are all the
Securities of such series authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation, those reductions in the interest
in a Global Security effected by the Trustee in accordance with the provisions
hereof, and those described in this Section as not outstanding. Except as set
forth in Section 2.09 hereof, a Note does not cease to be outstanding because
the Company or an Affiliate of the Company holds the Note; however, Securities
held by the Company or a Subsidiary of the Company shall not be deemed to be
outstanding for purposes of Section 3.07(b) hereof.

              If a Note is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser or protected purchaser.

              If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.

              If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Securities payable on that date, then on and after that date
such Securities shall be deemed to be no longer outstanding and shall cease to
accrue interest.

SECTION 2.09.  TREASURY SECURITIES.

              In determining whether the Holders of the required principal
amount of Securities of any series have concurred in any direction, waiver or
consent, Securities owned by the Company, or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company, shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities that the
Trustee knows are so owned shall be so disregarded.

SECTION 2.10.  TEMPORARY SECURITIES.

              Until certificates representing Securities are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of certificated Securities of the same series but may
have variations that the Company considers appropriate for temporary Securities
and as shall be reasonably acceptable to the Trustee. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities of the same series.

              Holders of temporary Securities shall be entitled to all of the
benefits of this Indenture.
<PAGE>   44
                                                                             44

SECTION 2.11.  CANCELLATION.

              The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel all Securities surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy canceled Securities (subject to the record retention requirements
of the Exchange Act). Certification of the destruction of all canceled
Securities shall be delivered to the Company. The Company may not issue new
Securities to replace Securities that it has paid or that have been delivered to
the Trustee for cancellation.

SECTION 2.12.  DEFAULTED INTEREST.

              If the Company defaults in a payment of interest on any series of
Securities, it shall pay the defaulted interest in any lawful manner plus, to
the extent lawful, interest payable on the defaulted interest, to the Persons
who are Holders of such Securities on which interest is due on a subsequent
special record date, in each case at the rate provided in the Securities and in
Section 4.01 hereof. The Company shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.

SECTION 2.13.  CUSIP NUMBERS.

              The Company in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use CUSIP numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or the omission of such numbers. The Company will promptly
notify the Trustee of any change in the CUSIP numbers.

                      ARTICLE 3. REDEMPTION AND PREPAYMENT

SECTION 3.01.  NOTICES TO TRUSTEE.

              If the Company elects to redeem Securities of any series pursuant
to the optional redemption provisions of Section 3.07 hereof, it shall furnish
to the Trustee, at least 30 days but not more than 60 days before a redemption
date, an Officers' Certificate setting forth (i) the clause of this Indenture
pursuant to which the redemption shall occur, (ii) the redemption date,

<PAGE>   45
                                                                              45

(iii) the principal amount of Securities of such series to be redeemed, (iv) the
redemption price and (v) the CUSIP numbers of the Securities of such series to
be redeemed.

SECTION 3.02.  SELECTION OF SECURITIES TO BE REDEEMED.

              If less than all of the Securities of any series are to be
redeemed or purchased in an offer to purchase at any time, the Trustee shall
select the Securities of such series to be redeemed or purchased among the
Holders of the Securities of such series in compliance with the requirements of
the principal national securities exchange, if any, on which the Securities of
such series are listed or, if the Securities of such series are not so listed,
on a pro rata basis, by lot or in accordance with any other method the Trustee
considers fair and appropriate. In the event of partial redemption by lot, the
particular Securities of such series to be redeemed shall be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption date by the Trustee from the outstanding Securities of such series
not previously called for redemption.

              The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Securities and
portions of Securities selected shall be in amounts of $1,000 or whole multiples
of $1,000; except that if all of the Securities of a Holder are to be redeemed,
the entire outstanding amount of Securities held by such Holder, even if not a
multiple of $1,000, shall be redeemed. Except as provided in the preceding
sentence, provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.

SECTION 3.03.  NOTICE OF REDEMPTION.

              Subject to the provisions of Section 3.11 hereof, at least 30 days
but not more than 60 days before a redemption date, the Company shall mail or
cause to be mailed, by first class mail, a notice of redemption to each Holder
whose Securities are to be redeemed at its registered address.

              The notice shall identify the Securities to be redeemed and shall
state:

              (a) the redemption date;

              (b) the redemption price;

              (c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Securities in principal amount equal
to the unredeemed portion shall be issued upon cancellation of the original
Note;

              (d) the name and address of the Paying Agent;

              (e) that Securities called for redemption must be surrendered to
the Paying Agent to

<PAGE>   46
                                                                              46

collect the redemption price;

              (f) that, unless the Company defaults in making such redemption
payment, interest on Securities called for redemption ceases to accrue on and
after the redemption date;

              (g) the paragraph of the Securities and/or Section of this
Indenture pursuant to which the Securities called for redemption are being
redeemed; and

              (h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Securities.

              At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.

SECTION 3.04.  EFFECT OF NOTICE OF REDEMPTION.

              Once notice of redemption is mailed in accordance with Section
3.03 hereof, Securities called for redemption become irrevocably due and payable
on the redemption date at the redemption price. A notice of redemption may not
be conditional.

SECTION 3.05.  DEPOSIT OF REDEMPTION PRICE

              Prior to 10 a.m. on the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued interest on all Securities to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, and accrued interest on, all
Securities to be redeemed.

              If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Securities or the portions of Securities called for redemption. If a Note is
redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest shall be paid to the
Person in whose name such Note was registered at the close of business on such
record date. If any Note called for redemption shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall be paid on the unpaid principal, from
the redemption date until such principal is paid, and to the extent lawful on
any interest not paid on such unpaid principal, in each case at the rate
provided in the Securities and in Section 4.01 hereof.

SECTION 3.06.  SECURITIES REDEEMED IN PART.

              Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon
<PAGE>   47
                                                                              47

the Company's written request, the Trustee shall authenticate for the Holder at
the expense of the Company a new Note of the same series equal in principal
amount to the unredeemed portion of the Note surrendered.

SECTION 3.07.  OPTIONAL REDEMPTION.

              (a) Except as set forth in Sections 3.07(b) and (c) below and in
Section 3.08 hereof, the Notes Due 2010 shall not be redeemable at the Company's
option prior to ___________ 2005. Thereafter, the Notes Due 2010 shall be
subject to redemption at any time or from time to time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest and Special Interest, if any,
thereon to the applicable redemption date, if redeemed during the twelve-month
period beginning on __________ of the years indicated below:
<TABLE>
<CAPTION>

                                                            PERCENTAGE OF
                       YEAR                              PRINCIPAL AMOUNT
                       ----                              ----------------
<S>                                                     <C>
2005................................................
2006................................................
2007................................................
2008 and thereafter.................................
</TABLE>

              (b) Notwithstanding the foregoing, at any time prior to
____________, 2003, the Company may, on any one or more occasions, redeem up to
35% of the aggregate principal amount of Notes Due 2010 originally issued
pursuant to this Indenture at a redemption price of ____________% of the
principal amount thereof, plus accrued and unpaid interest thereon to the
redemption date, with the net cash proceeds received from one or more Equity
Offerings made by the Company after the date of this Indenture; provided that at
least 65% of the aggregate principal amount of Securities originally issued
pursuant to this Indenture remain outstanding immediately after the occurrence
of any such redemption. The Company may make any such redemption upon not less
than 30 nor more than 60 days' notice (but in no event more than 90 days after
the closing of the related Equity Offering). Any such notice may be given prior
to the completion of the related Equity Offering and any such redemption may, at
the Company's discretion, be subject to the satisfaction of one or more
conditions precedent, including, but not limited to, the completion of the
related Equity Offering.

              (c) In addition, at any time prior to _________, 2005, the Notes
Due 2010 may be redeemed at the option of the Company, in whole but not in part,
upon the occurrence of a Change of Control, upon not less than 30 nor more than
60 days' prior notice (but in no event may any such redemption occur more than
90 days after the occurrence of such Change of Control) mailed by first-class
mail to each Holder's registered address, at a redemption price equal to 100% of
the principal amount thereof plus the Applicable Premium as of, and accrued and
unpaid interest, if any, to, the date of redemption.

              (d) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
<PAGE>   48
                                                                              48
SECTION 3.08.  OPTIONAL TAX REDEMPTION.

              Each series of Securities will be subject to redemption at the
option of the Company or a successor corporation at any time, in whole but not
in part, upon not less than 30 nor more than 60 days' notice, at a redemption
price equal to the principal amount thereof, plus accrued and unpaid interest
thereon to the redemption date if, as a result of any change in or amendment to
the laws or any regulations or ruling promulgated thereunder of (x) Bermuda or
any political subdivision or governmental authority thereof or therein having
the power to tax, (y) any jurisdiction, other than the United States, from or
through which payment on the Securities is made by the Company or a successor
corporation, or its paying agent in its capacity as such or any political
subdivision or governmental authority thereof or therein having the power to tax
or (z) any other jurisdiction, other than the United States, in which the
Company or a successor corporation is organized, or any political subdivision or
governmental authority thereof or therein having the power to tax, or any change
in the official application or interpretation of such laws, regulations or
rulings, or any change in the official application or interpretation of, or any
execution of or amendment to, any treaty or treaties affecting taxation to which
such jurisdiction (or such political subdivision or taxing authority) is a party
(a "Change in Tax Law"), which becomes effective on or after the date of the
Offering Memorandum, the Company or a successor corporation is or would be
required on the next succeeding interest payment date to pay Additional Amounts
with respect to such series of Securities (as described under Section 3.09
hereof), and the payment of such Additional Amounts cannot be avoided by the use
of any reasonable measures available to the Company or a successor corporation.

              In addition, each series of Securities will be subject to
redemption at the option of the Company at any time, in whole but not in part,
upon not less than 30 nor more than 60 days' notice, at a redemption price equal
to the principal amount thereof, plus accrued and unpaid interest thereon to the
redemption date, if the Person formed by a consolidation or amalgamation of the
Company or into which the Company is merged or to which the Company conveys,
transfers or leases its properties and assets substantially as an entirety is
required, as a consequence of such consolidation, amalgamation, merger,
conveyance, transfer or lease and as a consequence of a Change in Tax Law
occurring after the date of such consolidation, amalgamation, merger,
conveyance, transfer or lease, to pay Additional Amounts in respect of any tax,
assessment or governmental charge imposed on any Holder of such series of
Securities.

SECTION 3.09.  PAYMENT OF ADDITIONAL AMOUNTS.

              If any deduction or withholding for any present or future taxes,
assessments or other governmental charges of (x) Bermuda or any political
subdivision or governmental authority thereof or therein having power to tax,
(y) any jurisdiction, other than the United States, from or through which
payment on any series of Securities is made by the Company or a successor
corporation, or its paying agent in its capacity as such or any political
subdivision or governmental authority thereof or therein having the power to tax
or (z) any other jurisdiction, other than the United States, in which the
Company or a successor corporation is organized, or any political subdivision or
governmental authority thereof or therein having the power to tax shall at any
time be required by such jurisdiction (or any such political subdivision or
taxing
<PAGE>   49
                                                                              49

authority) in respect of any amounts to be paid by the Company or a successor
corporation under any series of Securities, the Company or a successor
corporation will pay to each Holder of such series of Securities as additional
interest, such additional amounts ("Additional Amounts") as may be necessary in
order that the net amounts paid to such holder of such Securities who, with
respect to any such tax, assessment or other governmental charge, is not
resident in, or a citizen of, such jurisdiction, after such deduction or
withholding, shall not be less than the amount specified in such Securities to
which such Holder is entitled; provided, however, that the Company or a
successor corporation shall not be required to make any payment of Additional
Amounts for or on account of:

              (a) Any tax, assessment or other governmental charge that would
     not have been imposed but for (i) the existence of any present or former
     connection between such Holder (or between a fiduciary, settlor,
     beneficiary, member or shareholder of, or possessor of a power over, such
     Holder, if such Holder is an estate, trust, partnership, limited liability
     company or corporation) and the taxing jurisdiction or any political
     subdivision or territory or possession thereof or area subject to its
     jurisdiction, including, without limitation, such Holder (or such
     fiduciary, settlor, beneficiary, member, shareholder or possessor) being or
     having been a citizen or resident thereof or being or having been present
     or engaged in a trade or business therein or having or having had a
     permanent establishment therein, (ii) the presentation of a Note (where
     presentation is required) for payment on a date more than 30 days after (x)
     the date on which such payment became due and payable or (y) the date on
     which payment thereof is duly provided for, whichever occurs later, or
     (iii) the presentation of a Note for payment in Bermuda or any political
     subdivision thereof or therein, unless such Note could not have been
     presented for payment elsewhere;

              (b) Any estate, inheritance, gift, sales, transfer, personal
     property or similar tax, assessment or other governmental charge;

              (c) Any tax, assessment or other governmental charge that is
     payable otherwise than by withholding from payment of principal of,
     premium, if any, or any interest on the Securities;

              (d) Any tax, assessment or other governmental charge that is
     imposed or withheld by reason of the failure by the Holder or the
     beneficial owner of the Note to comply with a request of the Company
     addressed to the Holder (i) to provide information, documents or other
     evidence concerning the nationality, residence or identity of the Holder or
     such beneficial owner or (ii) to make and deliver any
     declaration or other similar claim (other than a claim for refund of a tax,
     assessment or other governmental charge withheld by the Company) or satisfy
     any information or reporting requirements, which, in the case of (i) or
     (ii), is required or imposed by a statute, treaty, regulation or
     administrative practice of the taxing jurisdiction as a precondition to
     exemption from all or part of such tax, assessment or other governmental
     charge; or

              (e)     Any combination of items (a), (b), (c) and (d) above;

              nor shall Additional Amounts be paid with respect to any payment
of the principal of, or
<PAGE>   50
                                                                              50

any premium or interest on, any Note to any Holder who is a fiduciary or
partnership or limited liability company or other than the sole beneficial owner
of such payment to the extent such payment would be required by the laws of (x)
Bermuda or any political subdivision or governmental authority thereof or
therein having the power to tax, (y) any jurisdiction, other than the United
States, from or through which payment on the Securities is made by the Company
or a successor corporation, or its paying agent in its capacity as such or any
political subdivision or governmental authority thereof or therein having the
power to tax or (z) any other jurisdiction, other than the United States, in
which the Company or a successor corporation is organized, or any political
subdivision or governmental authority thereof or therein having the power to tax
to be included in the income for tax purposes of a beneficiary or settlor with
respect to such fiduciary or a member of such partnership, limited liability
company or beneficial owner who would not have been entitled to such Additional
Amounts had it been the Holder of such Note.

              The Company shall provide the Trustee with the official
acknowledgment of the relevant taxing authority (or, if such acknowledgment is
not available, a certified copy thereof) evidencing the payment of the
withholding taxes, if any, by the Company. Copies of such documentation shall be
made available to the Holders of the Securities or the Paying Agent, as
applicable, upon request therefor.

              All references in this Indenture to principal of, premium, if any,
and interest on the Securities shall include any Additional Amounts payable by
the Company in respect of such principal, such premium, if any, and such
interest.

SECTION 3.10.  MANDATORY REDEMPTION.

              Except as otherwise set forth in this Indenture, the Company shall
not be required to make mandatory redemption payments with respect to the
Securities.

SECTION 3.11.  OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.

              In the event that, pursuant to Section 4.10 hereof, the Company
shall be required to commence an Asset Sale Offer, it shall follow the
procedures specified below.

              The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the "Purchase
Date"), the Company shall purchase the principal amount of Securities required
to be purchased pursuant to Section 4.10 hereof (the "Offer Amount") or, if less
than the Offer Amount has been tendered, all Securities tendered in response to
the Asset Sale Offer. Payment for any Securities so purchased shall be made in
the same manner as interest payments are made.

              If the Purchase Date is on or after an interest record date and on
or before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Securities pursuant to the Asset Sale Offer.
<PAGE>   51
                                                                              51

              Upon the commencement of an Asset Sale Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:

              (a) that the Asset Sale Offer is being made pursuant to this
     Section 3.11 and Section 4.10 hereof and the length of time the Asset Sale
     Offer shall remain open;

              (b) the Offer Amount, the purchase price and the Purchase Date;

              (c) that any Note not tendered or accepted for payment shall
continue to accrue interest;

              (d) that, unless the Company defaults in making such payment, any
     Note accepted for payment pursuant to the Asset Sale Offer shall cease to
     accrue interest after the Purchase Date;

              (e) that Holders electing to have a Note purchased pursuant to an
     Asset Sale Offer may only elect to have all of such Note purchased and may
     not elect to have only a portion of such Note purchased;

              (f) that Holders electing to have a Note purchased pursuant to any
     Asset Sale Offer shall be required to surrender the Note, with the form
     entitled "Option of Holder to Elect Purchase" on the reverse of the Note
     completed, or transfer by book-entry transfer, to the Company, a
     depositary, if appointed by the Company, or a Paying Agent at the address
     specified in the notice at least three days before the Purchase Date;

              (g) that Holders shall be entitled to withdraw their election if
     the Company, the depositary or the Paying Agent, as the case may be,
     receives, not later than the expiration of the Offer Period, a telegram,
     telex, facsimile transmission or letter setting forth the name of the
     Holder, the principal amount of the Note the Holder delivered for purchase
     and a statement that such Holder is withdrawing his election to have such
     Note purchased;

              (h) that, if the aggregate principal amount of Securities
     surrendered by Holders exceeds the Offer Amount, the Company shall select
     the Securities to be purchased on a pro rata basis (with such adjustments
     as may be deemed appropriate by the Company so that only Securities in
     denominations of $1,000, or integral multiples thereof, shall be
     purchased); and

              (i) that Holders whose Securities were purchased only in part
     shall be issued new Securities equal in principal amount to the unpurchased
     portion of the Securities surrendered (or transferred by book-entry
     transfer).

              On or before 10:00 a.m. on the Purchase Date, the Company shall,
to the extent lawful,
<PAGE>   52
                                                                              52

accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount or portions thereof tendered pursuant to the Asset Sale Offer, or if less
than the Offer Amount has been tendered, all Securities tendered, and shall
deliver to the Trustee an Officers' Certificate stating that such Securities or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.11. The Company, the Depositary or the Paying Agent, as
the case may be, shall promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Securities tendered by such Holder and accepted by the
Company for purchase, and the Company shall promptly issue a new Note, and the
Trustee, upon written request from the Company shall authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.

              Other than as specifically provided in this Section 3.11, any
purchase pursuant to this Section 3.11 shall be made pursuant to the provisions
of Sections 3.01 through 3.06 hereof.

                              ARTICLE 4. COVENANTS

SECTION 4.01.  PAYMENT OF SECURITIES.

              The Company shall pay or cause to be paid the principal of,
premium, if any, and interest and Special Interest, if any, on the Securities on
the dates and in the manner provided in the Securities. Principal, premium, if
any, and interest and Special Interest, if any, shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest and Special Interest, if any, then
due. The Company shall pay all Special Interest, if any, in the same manner on
the dates and in the amounts set forth in the Registration Rights Agreement.

              The Company shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 1% per annum in excess of the then applicable interest rate on the
Securities to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest and Special Interest (without regard to any applicable grace period) at
the same rate to the extent lawful.

SECTION 4.02.  MAINTENANCE OF OFFICE OR AGENCY.

              The Company shall maintain in the Borough of Manhattan, the City
of New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Securities may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company shall give prompt written notice to the Trustee of
the
<PAGE>   53
                                                                              53

location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.

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

              The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03 hereof.

SECTION 4.03.  REPORTS.

              Whether or not required by the rules and regulations of the SEC,
so long as any Securities are outstanding, the Company will furnish to the
Trustee and the Holders of the Securities (i) all quarterly and annual financial
information that would be required to be contained in a filing with the SEC on
Forms 10-Q and 10-K if the Company was required to file such Forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" that describes the financial condition and results of operations of
the Company and its consolidated Subsidiaries and, with respect to the annual
information only, a report thereon by the Company's certified independent
accountants, and (ii) all current reports that would be required to be filed
with the SEC on Form 8-K if the Company were required to file such reports, in
each case within the time periods specified in the SEC's rules and regulations.
In addition, whether or not required by the rules and regulations of the SEC,
the Company will file a copy of all such information and reports with the SEC
for public availability within the time periods specified in the SEC's rules and
regulations (unless the SEC will not accept such a filing). Furthermore, the
Company will agree that, for so long as any Securities remain outstanding (and
regardless of the immediately preceding sentence), it will furnish to the
Holders of the Securities and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act or pursuant to the requirements of any
securities exchange, if applicable.

SECTION 4.04.  COMPLIANCE CERTIFICATE.

              (a) The Company and each Guarantor shall deliver to the Trustee
(to the extent that such Guarantor is so required under the TIA), within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
<PAGE>   54
                                                                              54

      has kept, observed, performed and fulfilled each and every covenant
      contained in this Indenture and is not in default in the performance or
      observance of any of the terms, provisions and conditions of this
      Indenture (or, if a Default or Event of Default shall have occurred,
      describing all such Defaults or Events of Default of which he or she may
      have knowledge and what action the Company is taking or proposes to take
      with respect thereto) and that to the best of his or her knowledge no
      event has occurred and remains in existence by reason of which payments on
      account of the principal of or interest, if any, on the Securities is
      prohibited or if such event has occurred, a description of the event and
      what action the Company is taking or proposes to take with respect
      thereto. For purposes of this paragraph, such compliance shall be
      determined without regard to any period of grace or requirement of notice
      provided under this Indenture.

              (b) So long as not contrary to the then current recommendations of
     the American Institute of Certified Public Accountants, the year-end
     financial statements delivered pursuant to Section 4.03(a) hereof shall be
     accompanied by a written statement of the Company's independent public
     accountants (who shall be a firm of established national reputation) that
     in making the examination necessary for certification of such financial
     statements, nothing has come to their attention that would lead them to
     believe that the Company has violated any provisions of Article 4 or
     Article 5 hereof or, if any such violation has occurred, specifying the
     nature and period of existence thereof, it being understood that such
     accountants shall not be liable directly or indirectly to any Person for
     any failure to obtain knowledge of any such violation.

              (c) The Company shall, so long as any of the Securities are
     outstanding, deliver to the Trustee, forthwith upon any Officer becoming
     aware of any Default or Event of Default, an Officers' Certificate
     specifying such Default or Event of Default and what action the Company is
     taking or proposes to take with respect thereto.

SECTION 4.05.  TAXES.

              The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Securities.

SECTION 4.06.  STAY, EXTENSION AND USURY LAWS.

              The Company and each of the Guarantors covenants (to the extent
that it may lawfully do so) that it shall not at any time insist upon, plead, or
in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company and each of the Guarantors (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it shall not, by resort to any such law, hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law has been enacted.
<PAGE>   55
                                                                              55
SECTION 4.07.  RESTRICTED PAYMENTS.

              The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make
any other payment or distribution on account of the Company's or any of its
Restricted Subsidiaries' Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the Company or
any of its Restricted Subsidiaries) or to the direct or indirect holders of the
Company's or any of its Restricted Subsidiaries' Equity Interests (other than
dividends or distributions by the Company payable in Equity Interests (other
than Disqualified Stock) of the Company, or dividends or distributions by a
Restricted Subsidiary made only to the Company or a Restricted Subsidiary of the
Company); (ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Company) any Equity Interests of the Company (other than any such
Equity Interests owned by the Company or any Restricted Subsidiary of the
Company); (iii) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness that is
subordinated to the Securities, except, in each use, a payment of interest or
principal at Stated Maturity; or (iv) make any Restricted Investment (all such
payments and other actions set forth in clauses (i) through (iv) above being
collectively referred to as "Restricted Payments"), unless

              (a) at the time of and after giving effect to such Restricted
Payment, no Default or Event of Default shall have occurred and be continuing or
would occur as a consequence thereof;

              (b) in the case of clauses (i), (ii) and (iii) above, and, in the
case of any Restricted Investment that is not an Investment in a Permitted
Business, the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the first paragraph
of Section 4.09 hereof; and

              (c) the aggregate amount (if not made in cash, the fair market
value as determined in good faith by the Board of Directors) of such Restricted
Payment and all other Restricted Payments made by the Company and its Restricted
Subsidiaries (excluding Restricted Payments permitted by clauses (ii), (iii),
(iv), (x) and (xiii) (but, in the case of clause (xiii), only to the extent that
such Restricted Payments are reflected as an expense on the income statements of
the Company) of the next succeeding paragraph), is less than the sum, without
duplication, of (i) the remainder of (x) 100% of cumulative Consolidated Cash
Flow (or, in case Consolidated Cash Flow shall be negative, less 100% of such
deficit) for the period (taken as one accounting period) beginning on the date
of this Indenture and ending on the last day of the last full fiscal quarter
immediately preceding the date of such Restricted Payment minus (y) the product
of 1.5 times the cumulative Consolidated Interest Expense of the Company from
the date of this Indenture through the last day of the last full fiscal quarter
immediately preceding the date of such Restricted Payment, plus (ii) 100% of the
aggregate net cash proceeds and the Fair Market Value of property or assets
received by the Company since the date of this

<PAGE>   56
                                                                              56
Indenture as a contribution to its common equity capital or from the issue or
sale of Equity Interests of the Company (other than Disqualified Stock) or from
the issue or sale of Disqualified Stock or Indebtedness of the Company that have
been converted into such Equity Interests (other than Equity Interests (or
Disqualified Stock or convertible debt securities) sold to a Subsidiary of the
Company), plus the amount of cash or the Fair Market Value of property or assets
received by the Company or any Restricted Subsidiary upon such conversion or
exchange, plus (iii) the aggregate amount equal to the net reduction in
Investments in Unrestricted Subsidiaries resulting from (x) dividends,
distributions, interest payments, return of capital, repayments of Investments
or other transfers of assets to the Company or any Restricted Subsidiary from
any Unrestricted Subsidiary, (y) proceeds realized by the Company or any
Restricted Subsidiary upon the sale of such Investment to a Person other than
the Company or any Subsidiary of the Company, or (z) the redesignation of any
Unrestricted Subsidiary as a Restricted Subsidiary, not to exceed in the case of
any of the immediately preceding clauses (x), (y) or (z) the aggregate amount of
Restricted Investments made by the Company or any Restricted Subsidiary in such
Unrestricted Subsidiary after the date of this Indenture, plus (iv) to the
extent that any Restricted Investment that was made after the date of this
Indenture is sold, the amount of cash or Fair Market Value of assets received
therefrom (net of any cost of disposition) not to exceed the aggregate amount of
such Restricted Investment.

              The foregoing provisions will not prohibit (i) the payment of any
dividend within 60 days after the date of declaration thereof, if at said date
of declaration such payment would have complied with the foregoing provisions;
(ii) the redemption, repurchase, retirement, defeasance or other acquisition of
any subordinated Indebtedness or Equity Interests of the Company in exchange
for, or out of the net cash proceeds of the substantially concurrent sale (other
than to a Subsidiary of the Company) of, other Equity Interests of the Company
(other than any Disqualified Stock) after the date of this Indenture; provided
that the amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement, defeasance or other acquisition shall be
excluded from clause (c)(ii) of the preceding paragraph; (iii) the defeasance,
redemption, retirement, repurchase or other acquisition of Indebtedness that is
subordinated to the Securities with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness; (iv) the payment of any dividend by a
Restricted Subsidiary of the Company to the holders of its Equity Interests on a
pro rata basis; (v) the purchase of any subordinated Indebtedness at a purchase
price not greater than 101% of the principal amount thereof following a Change
of Control pursuant to an obligation in the instruments governing such
subordinated Indebtedness to purchase or redeem such subordinated Indebtedness
as a result of such Change of Control; provided, however, that no such purchase
or redemption shall be permitted until the Company has completely discharged its
obligations described under Section 4.14 (including the purchase of all
Securities tendered for purchase by holders) arising as a result of such Change
of Control; (vi) payments or distributions, to dissenting stockholders pursuant
to applicable law, pursuant to or in connection with a consolidation, merger or
transfer of assets that complies with the provisions of this Indenture
applicable to mergers, consolidations and transfers of all or substantially all
of the property and assets of the Company and its Restricted Subsidiaries; (vii)
the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of the Company determined to be necessary or
advisable by the Board of Directors in good faith in connection with a merger or
acquisition of
<PAGE>   57
                                                                              57

assets by the Company as a Restricted Subsidiary or of a Person that is or
immediately thereafter becomes a Restricted Subsidiary otherwise permitted
pursuant to this Indenture in which at least 80% of the consideration issued or
paid by the Company and its Restricted Subsidiaries is Equity Interests of the
Company; provided that the aggregate amount of such repurchases, redemptions or
other acquisitions or retirements for value in connection with any merger or
acquisition shall not exceed the lesser of (x) 7.5% of the Consolidated Tangible
Assets of the Company and its Restricted Subsidiaries prior to the transaction
and (y) 7.5% of the Equity Interests to be issued by the Company in the
transaction (provided that the amount of such purchases shall reduce the amount
available for Restricted Payments under clause (c) (ii) of the immediately
preceding paragraph); (viii) the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of the Company or any of its
Restricted Subsidiaries held by any director, officer, employee or consultant of
the Company or any Restricted Subsidiary; provided that the aggregate price paid
for all such repurchased, redeemed, acquired or retired Equity Interests shall
not exceed $10.0 million in any twelve-month period (with unused amounts being
carried over to succeeding twelve-month periods, subject to a maximum of $15.0
million in any twelve-month period); provided further, that such amount in any
twelve-month period may be increased by an amount (to the extent not previously
applied) not to exceed (A) the cash proceeds received by the Company or any of
its Restricted Subsidiaries from the sale of Equity Interests (other than
Disqualified Stock) of the Company (to the extent contributed to the Company) to
directors, officers, employees or consultants of the Company and its Restricted
Subsidiaries that occurs after the Issue Date (provided that the amount of such
cash proceeds utilized for any such repurchase, retirement, other acquisition or
retirement for value will not increase the amount available for Restricted
Payments under clause (c)(ii) of the immediately preceding paragraph) plus (B)
the cash proceeds of key man life insurance policies received by the Company and
its Restricted Subsidiaries after the Issue Date (provided that the Company may
elect to apply all or any portion of the aggregate increase contemplated by
clauses (A) and (B) above in any single twelve-month period); (ix) repurchases
of Equity Interests deemed to occur upon exercise of stock options if such
Equity Interests represent a portion of the exercise price of such options; (x)
Investments acquired in exchange for Equity Interests (other than Disqualified
Stock), or made with the net cash proceeds received from an Equity Offering made
by the Company after June 30, 2000, (provided that the amount of any such Equity
Interests or net cash proceeds that are utilized for any such Investment shall
be excluded from clause (c)(ii) of the preceding paragraph) plus the net gain
realized in cash and not otherwise included in Consolidated Cash Flow from the
sale of Restricted Investments; (xi) the declaration and payment of dividends or
distributions to holders of any class or series of Disqualified Stock of the
Company or any of its Restricted Subsidiaries issued or incurred in accordance
with the Section 4.09 on the date on which such dividend or distribution was
scheduled to be paid in the original documentation governing such Disqualified
Stock, not including any contingent obligation to pay such dividend or
distribution prior to the date originally scheduled for the payment thereof;
(xii) the declaration and payment of dividends or distributions to holders of
any class or series of Designated Preferred Stock, not in excess of $50.0
million per year; and (xiii) other Restricted Payments in an aggregate amount
not to exceed $25.0 million.

              The Board of Directors may not designate any Subsidiary of the
Company (other than a newly created Subsidiary in which no Investment has been
made (other than the amount
<PAGE>   58
                                                                              58

required to capitalize such Subsidiary in connection with its organization))
as an Unrestricted Subsidiary (a "Designation") unless: (i) no Default or Event
of Default shall have occurred and be continuing at the time of or after giving
effect to such Designation; (ii) the Company would, immediately after giving
effect to such Designation, have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the first paragraph of Section 4.09; and
(iii) the Company would not be prohibited under this Indenture from making an
Investment at the time of such Designation (assuming the effectiveness of such
Designation for purposes of clauses (a) and (b) of this Section 4.07) in an
amount equal to the fair market value of the net Investment of the Company or
any other Restricted Subsidiary in such Subsidiary on such date.

              In the event of any such Designation, all outstanding Investments
owned by the Company and its Restricted Subsidiaries in the Subsidiary so
designated will be deemed to be an Investment made as of the time of such
Designation and will reduce the amount available for Restricted Payments under
the first paragraph or second paragraph of this Section 4.07, as applicable, or
Permitted Investments, as applicable. All such outstanding Investments will be
deemed to constitute Restricted Payments in an amount equal to the fair market
value of such Investments at the time of such Designation.

              A Designation may be revoked (a "Revocation") by a resolution of
the Board of Directors delivered to the Trustee, provided that the Company will
not make any Revocation unless: (i) no Default or Event of Default shall have
occurred and be continuing at the time of or after giving effect to such
Revocation; and (ii) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred at such
time, have been permitted to be incurred at such time for all purposes under
this Indenture.

              The amount of a Restricted Payment (other than cash) shall be the
Fair Market Value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company (or such
Restricted Subsidiary, as the case may be) pursuant to the Restricted Payment.

SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
SUBSIDIARIES.

              The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or consensual restriction
on the ability of any Restricted Subsidiary to (i)(a) pay dividends or make any
other distributions to the Company or any of its Restricted Subsidiaries (1) on
its Capital Stock or (2) with respect to any other interest or participation in,
or measured by, its profits, or (b) pay any indebtedness owed to the Company or
any of its Restricted Subsidiaries, (ii) make loans or advances to the Company
or any of its Restricted Subsidiaries or (iii) transfer any of its properties or
assets to the Company or any of its Restricted Subsidiaries. However, the
foregoing restrictions will not apply to encumbrances or restrictions existing
under or by reason of (a) Existing Indebtedness as in effect on the date of this
Indenture, (b) agreements as in effect as of the date of this Indenture, (c)
Indebtedness or any agreement pursuant to which such Indebtedness was issued,
incurred in accordance with clause (g), (h), (i), (k) or (n) of the second
paragraph of Section 4.09 hereof, provided that such (A) encumbrances or
restrictions are customary with respect to such types of Indebtedness (as
<PAGE>   59
                                                                              59
determined in good faith by the Chief Financial Officer of the Company), (B) the
encumbrance or restriction applies only in the event of a payment default or a
default with respect to a financial covenant contained in such Indebtedness or
agreement and (C) the Board of Directors determines that any such encumbrance or
restriction will not materially affect the Company's ability to pay principal,
premium, interest and Additional Amounts pursuant to the terms of the Securities
and this Indenture, (d) this Indenture, the Securities and the Exchange
Securities, (e) applicable law, (f) any instrument governing Indebtedness or
Capital Stock of a Person acquired by the Company or any of its Restricted
Subsidiaries as in effect at the time of such acquisition (except to the extent
such Indebtedness was incurred or Capital Stock was issued in connection with or
in contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or its Subsidiaries, or the property or assets of the Person or its
Subsidiaries, so acquired, provided, that in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred, (g) in
the case of clause (iii) of the first paragraph of this Section 4.08, (A)
existing by virtue of any transfer of, agreement to transfer, option or right to
transfer with respect to, or Lien on, any property or assets of the Company or
any Restricted Subsidiary not otherwise prohibited by this Indenture, or (B)
arising or agreed in the ordinary course of business, not relating to any
Indebtedness, and that do not, individually or in the aggregate, materially
detract from the value of property or assets of the Company or Restricted
Subsidiary to the Company or any Restricted Subsidiary, and that the Board of
Directors determines will not materially affect the Company's ability to pay
principal, premium, interest and Additional Amounts pursuant to the terms of the
Securities and this Indenture, (h) customary non-assignment provisions entered
into in the ordinary course of business in leases, licenses and other contracts
to the extent the provisions restrict the transfer, sublicensing or any license
or subletting of any lease or the assignment of rights under such contract, (i)
purchase money obligations for property acquired in the ordinary course of
business that impose restrictions of the nature described in clause (iii) above
on the property so acquired, (j) any agreement for the sale or other disposition
of a Restricted Subsidiary that restricts distributions by that Restricted
Subsidiary pending its sale or other disposition, (k) Permitted Refinancing
Indebtedness, provided that the restrictions contained in the agreements
governing such Permitted Refinancing Indebtedness are no more restrictive, taken
as a whole, than those contained in the agreements governing the Indebtedness
being refinanced, (l) Liens securing Indebtedness otherwise permitted to be
incurred pursuant to the provisions of Section 4.12 hereof that limit the right
of the Company or any of its Restricted Subsidiaries to dispose of the assets
subject to such Lien, (m) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements and other similar
agreements entered into in the ordinary course of business and (n) restrictions
on cash or other deposits or net worth imposed by customers under contracts
entered into in the ordinary course of business, (o) restrictions created in
connection with any Receivables Facility that, in the good faith determination
of the Board of Directors are necessary or advisable to effect such Receivables
Facility; provided, however, that such restrictions apply only to such
Receivables Entity; or (p) any encumbrances or restrictions of the type referred
to in clauses (i), (ii) and (iii) above imposed by any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings of the contracts, instruments or obligations
referred to in clauses (a) through (o) above, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith
<PAGE>   60
                                                                              60

judgment of the Board of Directors, no more restrictive with respect to such
dividend and other payment restrictions than those contained in the dividend or
other payment restrictions prior to such amendments, modifications, restatement,
renewal, increase, supplement, refunding, replacement or refinancing.

SECTION 4.09.  INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.

              The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company will not issue any Disqualified Stock and will not permit
any of its Restricted Subsidiaries to issue any Disqualified Stock or Preferred
Stock; provided, however, that the Company may incur Indebtedness (including
Acquired Debt) or issue shares of Disqualified Stock and its Restricted
Subsidiaries may incur Indebtedness or issue Disqualified Stock or Preferred
Stock if either:

              (i) the Consolidated Leverage Ratio is less than 6.0 to 1.0 prior
     to December 31, 2002, or 5.5 to 1.0 thereafter; or

              (ii) the Consolidated Capital Ratio is less than 2.25 to 1.0.

              Notwithstanding the foregoing, the provisions of the paragraph set
forth above will not apply to the incurrence of any of the following items of
Indebtedness (collectively, "Permitted Indebtedness"):

              (a) The incurrence by the Company of Indebtedness represented by
        the Securities and the Exchange Securities and any Guarantees thereof;

              (b) The incurrence by the Company or any of its Restricted
        Subsidiaries of Existing Indebtedness;

              (c) The incurrence of Indebtedness by the Company to any
        Restricted Subsidiary or Indebtedness of any Restricted Subsidiary to
        the Company or any other Restricted Subsidiary or the issuance of shares
        of Preferred Stock by a Restricted Subsidiary to the Company or any
        other Restricted Subsidiary (but only for so long as such Indebtedness
        or shares of Preferred Stock are held by the Company or such Restricted
        Subsidiary);

              (d) The incurrence by the Company or any of its Restricted
        Subsidiaries of Capital Lease Obligations (other than leases of backhaul
        services) incurred for the purpose of financing all or any part of the
        purchase price or cost of construction or improvement of property, plant
        or equipment used in the business of the Company or such Restricted
        Subsidiary, including all Permitted Refinancing Indebtedness incurred to
        refund, refinance or replace any Indebtedness incurred pursuant to this
        clause (d), in an aggregate principal amount not to exceed $25.0 million
        at any time outstanding;

              (e) The incurrence by the Company or any of its Restricted
        Subsidiaries of
<PAGE>   61
                                                                              61

     Indebtedness pursuant to acquisitions of capacity made in the ordinary
     course of business;

              (f) The incurrence by the Company or any of its Restricted
     Subsidiaries of Hedging Obligations that are incurred for the purpose of
     fixing or hedging interest or foreign currency exchange rate risk with
     respect to any floating rate Indebtedness that is permitted by the terms of
     this Indenture to be outstanding;

              (g) The incurrence by the Company or any of its Restricted
     Subsidiaries of Acquired Debt;

              (h) The incurrence by the Company or any of its Restricted
     Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
     net proceeds of which are used to refund, refinance or replace Indebtedness
     (other than intercompany Indebtedness) that was permitted by this Indenture
     to be incurred pursuant to the immediately preceding paragraph hereof or
     clauses (a), (b), (d), (e), (g), (h), (i), (k), (m), (n) or (o) of this
     paragraph;

              (i) The incurrence by the Company or any of its Restricted
     Subsidiaries of additional Indebtedness not otherwise permitted to be
     incurred pursuant to this paragraph in an aggregate principal amount (or
     accreted value, as applicable) at any time outstanding, including all
     Permitted Refinancing Indebtedness incurred to refund, refinance or replace
     any Indebtedness incurred pursuant to this clause (i), not to exceed $100.0
     million;

              (j) The incurrence of Indebtedness by a Receivables Entity in a
     Qualified Receivables Transaction, provided that the proceeds thereof are
     applied in accordance with Section 4.10 hereof;

              (k) The incurrence by the Company or any Restricted Subsidiary of
     Purchase Money Indebtedness;

              (l) Letters of Credit that are cash collateralized; Indebtedness
     (A) in respect of performance, surety or appeal bonds or letters of credit
     supporting Trade Payables, in each case provided in the ordinary course of
     business, and (B) arising from agreements providing for indemnification,
     adjustment of purchase price or similar obligations, or from guarantees or
     letters of credit, surety bonds or performance bonds securing any
     obligations of the Company or any of its Restricted Subsidiaries pursuant
     to such agreements, in any case incurred in connection with the disposition
     of any business, assets or Restricted Subsidiary of the Company (other than
     guarantees of Indebtedness incurred for the purpose of financing such
     acquisition by the Person acquiring all or any portion of such business,
     assets or Restricted Subsidiary), in a principal amount not to exceed the
     gross proceeds actually received by the Company or any Restricted
     Subsidiary in connection with such disposition;

              (m) Indebtedness of the Company that by its terms or by the terms
     of any agreement or instrument pursuant to which such Indebtedness is
     incurred (x) is expressly made subordinate in right of payment to the
     Securities and (y) provides that no payment with respect thereto other than
     interest may be made prior to the payment in full of all of the
<PAGE>   62
                                                                              62

     Company's obligations under the Securities except with the proceeds of a
     capital contribution, the sale of Capital Stock (other than Disqualified
     Stock) of the Company or other Indebtedness incurred pursuant to this
     clause (m) or Permitted Refinancing Indebtedness incurred to refund,
     refinance or replace any Indebtedness incurred pursuant to this clause (m),
     not in excess of $200.0 million at any time outstanding except to the
     extent such Indebtedness in excess thereof also provides that no payment of
     interest may be made prior to the payment in full of all of the Company's
     obligations under the Securities except as provided above;

              (n) The incurrence by the Company or any of its Restricted
     Subsidiaries of Indebtedness under one or more Credit Facilities or Letters
     of Credit, in an aggregate principal amount at any one time outstanding not
     to exceed the greater of (x) $200.0 million and (y) 85.0% of Eligible
     Accounts Receivable not sold or pledged for Indebtedness incurred under
     clause (j), including all Permitted Refinancing Indebtedness incurred to
     refund, refinance or replace any Indebtedness incurred pursuant to this
     clause (n);

              (o) The guarantee by the Company or any Restricted Subsidiary of
     Indebtedness of the Company or any Restricted Subsidiary of the Company
     that was permitted to be incurred by another provision of this Section
     4.09; and

              (p) Indebtedness arising from the honoring by a bank or other
     financing institution of a check, draft or similar instrument drawn against
     insufficient funds in the ordinary course of business, provided that such
     Indebtedness is extinguished within two business days of its incurrence.

              The Company will not, and will not permit any of its Restricted
Subsidiaries to, incur any Indebtedness (including Permitted Indebtedness) that
is contractually subordinated in right of payment to any other Indebtedness of
the Company or such Restricted Subsidiary unless such Indebtedness is also
contractually subordinated in right of payment to the Securities on
substantially identical terms; provided, however, that no Indebtedness of the
Company shall be deemed to be contractually subordinated in right of payment to
any other Indebtedness of the Company solely by virtue of being unsecured.

                 Notwithstanding any other provision of this Section 4.09, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary may
incur pursuant to this Section 4.09 shall not be deemed to be exceeded with
respect to any outstanding Indebtedness solely as a result of fluctuations in
the exchange rate of currencies.

              For purposes of determining any particular amount of Indebtedness
under this Section 4.09, guarantees, Liens or obligations with respect to
letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included. For purposes of
determining any particular amount of Indebtedness under this Section 4.09, if
any such Indebtedness denominated in a foreign currency is subject to a Currency
Agreement with respect to U.S. dollars covering all principal of, premium, if
any, and interest payable on such Indebtedness, the amount of such Indebtedness
expressed in U.S. dollars will be as provided in such Currency Agreement. For
purposes of determining compliance with this Section 4.09, (A)
<PAGE>   63
                                                                              63

in the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness described in the above clauses, the Company, in its
sole discretion, shall classify (and from time to time may reclassify) such item
of Indebtedness and only be required to include the amount and type of such
Indebtedness in one of such clauses and (B) the principal amount of Indebtedness
issued at a price that is less than the principal amount thereof shall be equal
to the amount of the liability in respect thereof determined in conformity with
GAAP.

SECTION 4.10.  ASSET SALES

              The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, consummate any Asset Sale unless, (i)
the Company (or such Restricted Subsidiary, as the case may be) receives
consideration at the time of such Asset Sale at least equal to the fair market
value (as determined in good faith by the Board of Directors (including as to
the value of all noncash consideration) and set forth in an Officer's
Certificate delivered to the Trustee) of the assets or Equity Interests issued
or sold or otherwise disposed of and (ii) at least 75% of the consideration
therefor is in the form of cash and/or Cash Equivalents, and (iii) the Net
Proceeds received by the Company (or such Restricted Subsidiary, as the case may
be) from such Asset Sale are applied within 360 days following the receipt of
such Net Proceeds (a) to repay, redeem or repurchase outstanding pari passu
Indebtedness of the Company or Indebtedness of any Restricted Subsidiary;
provided that in the event that such Restricted Subsidiary is a Guarantor, the
Indebtedness to be redeemed or repurchased ranks at least pari passu to the
Guarantee given by such Restricted Subsidiary, (b) to reinvest, or enter into a
legally binding agreement to reinvest, such Net Proceeds (or any portion
thereof) in assets that are used or useful in a Permitted Business or in the
Capital Stock of a Person engaged in a Permitted Business that is or immediately
thereafter becomes a Restricted Subsidiary or (c) in any combination permitted
by clauses (a) and (b). Pending the final application of any such Net Proceeds,
the Company or such Restricted Subsidiary may invest such Net Proceeds in Cash
Equivalents. The balance of such Net Proceeds, after the application of such Net
Proceeds as described in the immediately preceding clauses (a) and (b), shall
constitute "Excess Proceeds."

              When the aggregate amount of Excess Proceeds equals or exceeds
$15.0 million, the Company will be required to and, at the election of the
Company, at any earlier time, the Company, may make an offer to all Holders of
Securities and pari passu Indebtedness (an "Asset Sale Offer") to purchase the
maximum principal amount of Securities and pari passu Indebtedness that may be
purchased out of the Excess Proceeds, at a purchase price in cash in an amount
equal to 100% of the principal amount thereof, plus accrued and unpaid interest
thereon to the date of purchase, in accordance with the procedures set forth in
Article 3 of this Indenture and the agreements governing such pari passu
Indebtedness. To the extent that any Excess Proceeds remain after consummation
of an Asset Sale Offer, the Company may use such Excess Proceeds for any purpose
not otherwise prohibited by this Indenture. If the aggregate principal amount of
Securities and pari passu Indebtedness tendered into such Asset Sale Offer by
holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select
the Securities and pari passu Indebtedness to be purchased on a pro rata basis.
Upon completion of such Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero for purposes of the first sentence of this paragraph.
<PAGE>   64
                                                                              64

              The amount of (i) any liabilities (as shown on the Company's (or
such Restricted Subsidiary's, as the case may be) most recent balance sheet) of
the Company or any Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Securities or any
guarantee thereof) that are assumed by the transferee of any such assets
pursuant to an agreement that releases the Company or any Restricted Subsidiary
from all liability in respect thereof, (ii) Indebtedness of any Restricted
Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset
Sale, to the extent that the Company and each other Restricted Subsidiary are
released from any guarantee of payment of the principal amount of such
Indebtedness in connection with such Asset Sale (iii) any securities, Securities
or other obligations received by the Company (or such Restricted Subsidiary, as
the case may be) from such transferee that are converted by the Company (or such
Restricted Subsidiary, as the case may be) into cash and/or Cash Equivalents (to
the extent of the cash and/or Cash Equivalents received) within 180 days
following the receipt thereof, (iv) the Fair Market Value of any assets used or
useful in a Permitted Business received in such Asset Sale and (v) any
Designated Noncash Consideration received by the Company or any of its
Restricted Subsidiaries in such Asset Sale having an aggregate Fair Market
Value, taken together with all other Designated Noncash Consideration received
pursuant to this clause (v) that is at that time outstanding, not to exceed 10%
of Consolidated Tangible Assets at the time of receipt of such Designated
Noncash Consideration, will be deemed to be cash and/or Cash Equivalents for
purposes of this provision.

              The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act, and any other securities laws and regulations to the extent
such laws and regulations are applicable in connection with the purchase of the
Securities as a result of an Asset Sale Offer. To the extent that the provisions
of any securities laws or regulations conflict with the Asset Sale provisions of
this Indenture, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under the
Asset Sale provisions of this Indenture by virtue thereof.

SECTION 4.11.  TRANSACTIONS WITH AFFILIATES.

              The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless
(i) such Affiliate Transaction is on terms that are not materially less
favorable to the Company or the relevant Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Restricted Subsidiary with an unrelated Person and (ii) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $25.0 million, the Company
delivers to the Trustee a resolution of the Board of Directors set forth in an
Officers' Certificate certifying that such Affiliate Transaction complies with
clause (i) above and that such Affiliate Transaction is approved by a majority
of the Disinterested Directors and (iii) with respect to any Affiliate
Transaction or series of related Affiliate Transactions (other than with
Microsoft Corporation, Softbank Corp. or any of their respective Affiliates)
involving aggregate consideration in excess of $50.0 million, the Company
<PAGE>   65
                                                                              65

delivers to the Trustee an opinion as to the fairness to the Holders of such
Affiliate Transaction from a financial point of view from an accounting,
appraisal or investment banking firm of national standing.

              Notwithstanding the foregoing, the following items shall not be
deemed to be Affiliate Transactions: (i) (a) the entering into, maintaining or
performance of any employment contract, collective bargaining agreement, Plan,
related trust agreement or any other similar arrangement for or with any
employee, officer, consultant or director heretofore or hereafter entered into
in the ordinary course of business, (b) the payment of compensation, performance
of indemnification or contribution obligations, or an issuance, grant or award
of stock, options, or other equity-related interests or other securities to
employees, officers, consultant or directors in the ordinary course of business,
(c) any transaction in the ordinary course of business not involving more than
$250,000 in any one case, or (d) Management Advances and payments in respect
thereof, (ii) transactions between or among the Company and/or its Restricted
Subsidiaries or any Receivables Entity, (iii) payment of reasonable directors
fees, (iv) any sale or other issuance of Equity Interests (other than
Disqualified Stock) of the Company, (v) Affiliate Transactions in effect or
approved by the Board of Directors on the date of this Indenture, including any
amendments thereto (provided that the terms of such amendments are not
materially less favorable to the Company or the relevant Restricted Subsidiary
than the terms of such agreement prior to such amendment), (vi) any transaction
between the Company or any Restricted Subsidiary, on the one hand, and any
Affiliate of the Company engaged primarily in a Permitted Business on the other
hand, (A) in the ordinary course of business and consistent with commercially
reasonable practices or (B) approved by a majority of the Disinterested
Directors, (vii) any payment pursuant to any tax sharing agreement between the
Company and any other Person with which the Company files a consolidated tax
return or with which the Company is part of a consolidated group for tax
purposes, provided that such payment is not greater than that which the Company
would be required to pay as a stand-alone taxpayer, (viii) the existence of, or
the performance by the Company or any of its Restricted Subsidiaries of its
obligations under the terms of any stockholders agreement (including any
registration rights agreement or purchase agreement related thereto) to which it
is a party as of the Issue Date and any similar agreements which it may enter
into thereafter that are otherwise permitted by this Indenture; provided,
however, that the existence of, or the performance by the Company or any of its
Restricted Subsidiaries of obligations under any future amendment to any such
existing agreement or under any similar agreement entered into after the Issue
Date shall only be permitted by this clause (viii) to the extent that the terms
of any such amendment or new agreement are not otherwise materially adverse to
the interests of the Holders, and (ix) Restricted Payments that are permitted by
Section 4.07 hereof.

SECTION 4.12.  LIENS.

              The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create, incur, assume or otherwise cause or suffer to exist or
become effective any Lien of any kind (other than Permitted Liens) upon any of
their property or assets, now owned or hereafter acquired, unless all payments
due under this Indenture and the Securities are secured on an equal and ratable
basis with the obligations so secured until such time as such obligations are no
longer secured by a Lien.
<PAGE>   66
                                                                              66

SECTION 4.13.  CORPORATE EXISTENCE.

              Subject to Article 5 hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Subsidiaries, in accordance with the respective organizational documents
(as the same may be amended from time to time) of the Company or any such
Subsidiary and (ii) the rights (charter and statutory), licenses and franchises
of the Company and its Subsidiaries; provided, however, that the Company shall
not be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Subsidiaries, if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries,
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders of the Securities.

SECTION 4.14.  OFFER TO REPURCHASE UPON CHANGE OF CONTROL.

              (a) Upon the occurrence of a Change of Control, each Holder of
Securities will have the right to require the Company to purchase all or any
part (equal to $1,000 or an integral multiple thereof) of such Holder's
Securities pursuant to the offer described below (the "Change of Control Offer")
at a purchase price in cash (the "Change of Control Payment") equal to 101% of
the aggregate principal amount thereof, plus accrued and unpaid interest and
Special Interest thereon to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date); provided, however, that the Company shall not
be obligated to repurchase Securities pursuant to this covenant in the event
that it has exercised its rights to redeem all of the Securities as described in
Sections 3.07 and 3.08 hereof. Within 30 days following any Change of Control,
the Company will mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to purchase
Securities on the date specified in such notice, which date shall be no earlier
than 30 and no later than 60 days from the date such notice is mailed (the
"Change of Control Payment Date"), in accordance with the procedures required by
this Indenture and described in such notice. The Company will comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations to the extent such laws and regulations are applicable in
connection with the purchase of Securities as a result of a Change of Control.
To the extent that the provisions of any securities laws or regulations conflict
with any of the provisions of this Section 4.14, the Company will comply with
the applicable securities laws and regulations and will be deemed not to have
breached its obligations under this covenant by virtue thereof.

              (b) On the Change of Control Payment Date, the Company will, to
the extent lawful, (1) accept for payment all Securities or portions thereof
properly tendered pursuant to the Change of Control Offer, (2) deposit with the
Paying Agent an amount equal to the Change of Control Payment in respect of all
Securities or portions thereof so tendered and (3) deliver or cause to be
delivered to the Trustee Securities so accepted together with an Officers'
Certificate stating the aggregate principal amount of Securities or portions
thereof being purchased by the Company. The Paying Agent will promptly mail or
deliver to each Holder of Securities so tendered the Change of Control Payment
for such Securities, and the Trustee will
<PAGE>   67
                                                                              67

promptly authenticate and mail or deliver (or cause to be transferred by book
entry) to each Holder a new Note equal in principal amount to any unpurchased
portion of Securities surrendered, if any; provided that each such new Note will
be in a principal amount of $1,000 or an integral multiple thereof. The Company
will publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.

         (c) Notwithstanding anything to the contrary in this Section 4.14, the
Company shall not be required to make a Change of Control Offer upon the
occurrence of a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.14, and purchases all Securities
validly tendered and not withdrawn under such Change of Control Offer.

Section 4.15.  Business Activities.

         The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in any business other than a Permitted Business, and
will not become an instrument company subject to regulation under the Investment
Company Act of 1940, as amended.

Section 4.16.
                               [Reserved]

Section 4.17.

                               [Reserved]

Section 4.18. Issuances and Sales of Equity Interests in Wholly Owned Restricted
Subsidiaries.

         The Company (i) shall not, and shall not permit any of its Restricted
Subsidiaries to, transfer, convey, sell, lease or otherwise dispose of any
Equity Interests in East Asia Crossing Ltd. and its Wholly Owned Restricted
Subsidiaries or any Wholly Owned Restricted Subsidiary of the Company that
directly or indirectly owns such Subsidiaries to any Person (other than the
Company or a Wholly Owned Restricted Subsidiary of the Company) and (ii) shall
not permit East Asia Crossing Ltd. and its Wholly Owned Restricted Subsidiaries
or any Wholly Owned Restricted Subsidiary of the Company that directly or
indirectly owns such Subsidiaries to issue any of its Equity Interests (other
than, if necessary, shares of its Capital Stock constituting directors'
qualifying shares) to any Person other than to the Company or a Wholly Owned
Restricted Subsidiary of the Company, except in the case (a) such transfer,
conveyance, sale, lease or other disposition, together with all prior transfers,
conveyances, sales, leases or other dispositions, does not exceed 20% of the
Equity Interest in East Asia Crossing Ltd. and its Wholly Owned Restricted
Subsidiaries or such Wholly Owned Restricted Subsidiary of the Company and (b)
the Net Proceeds from such transfer, conveyance, sale, lease or other
disposition are applied either (A) to repay outstanding Indebtedness permanently
under the Credit Facilities of the Company or its Restricted Subsidiaries or (B)
to make an offer to all Holders of Securities to purchase all or any part of
such Holders' Securities at a purchase price in cash in an amount equal to ___%
of the principal amount thereof plus accrued and unpaid
<PAGE>   68
                                                                              68

interest thereon to the date of purchase, in accordance with Section 9(b) on the
back of the Note.

Section 4.19.  Payments For Consent.

         Neither the Company nor any of its Restricted Subsidiaries shall,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder of any Securities for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Securities unless such consideration is offered to be
paid or is paid to all Holders of the Securities that consent, waive or agree to
amend such terms or provisions of this Indenture or the Securities in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.

Section 4.20.  Money for Payments to Be Held In Trust.

         If the Company shall at any time act as its own Paying Agent, it will,
on or before each due date of the principal, premium, interest or Special
Interest, if any, with respect to the Securities, segregate and hold in trust
for the benefit of the Persons entitled thereto a sum sufficient to pay the
principal, premium, interest or Special Interest, if any, so becoming due until
such sums shall be paid to such Persons or otherwise disposed of as herein
provided, and will promptly notify the Trustee of its action or failure so to
act.

         Whenever the Company shall have one or more Paying Agents for the
Securities, it will, on or before each due date of the principal, premium,
interest or Special Interest, if any, with respect to the Securities, deposit
with a Paying Agent a sum in same day funds (or New York Clearing House funds if
such deposit is made prior to the date on which such deposit is required to be
made) sufficient to pay the principal, premium, interest or Special Interest, if
any, so becoming due (or at the option of the Company, payment of interest may
be mailed by check to the Holders of the Securities at their respective
addresses set forth in the register of Holders of Securities; provided that all
payments with respect to Securities represented by one or more permanent global
Securities will be paid by wire transfer of immediately available funds to the
account of the Depository Trust Company or any successor thereto) such sum to be
held in trust for the benefit of the Persons entitled to such principal,
premium, interest or Special Interest, if any, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of such action or any
failure so to act.

         The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:

         (a) hold all sums held by it for the payment of the principal of,
    premium, if any, or interest on Securities in trust for the benefit of the
    Persons entitled thereto until such sums shall be paid to such Persons or
    otherwise disposed of as herein provided;

         (b) give the Trustee notice of any default by the Company (or any other
    obligor upon the Securities) in the making of any payment of principal,
    premium, interest or Special
<PAGE>   69
                                                                              69

    Interest, if any;

         (c) at any time during the continuance of any such default, upon the
    written request of the Trustee, forthwith pay to the Trustee all sums so
    held in trust by such Paying Agent; and

         (d) acknowledge, accept and agree to comply in all respects with the
    provisions of this Indenture relating to the duties, rights and obligations
    of such Paying Agent.

         The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such money.

         Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal, premium, interest or
Special Interest, if any, with respect to a Note and remaining unclaimed for two
years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Company at the request of the Company or (if then
held by the Company) shall be discharged from such trust; and the Holder of such
Note shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, shall at
the expense of the Company cause notice to be promptly sent to each Holder that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such notification any unclaimed
balance of such money then remaining will be repaid to the Company.

Section 4.21.  Future Guarantees.

         If any Restricted Subsidiary guarantees any Debt Securities issued by
the Company, then (i) the Company shall promptly notify the Trustee of such
guarantee, (ii) the Trustee shall, in turn, notify each Holder and (iii) the
Company shall cause this Indenture to be amended to make such Restricted
Subsidiary a Guarantor hereunder. Prior to the execution of such amendment, each
such Restricted Subsidiary required to become a Guarantor pursuant to the
provisions of this Section 4.21 shall be deemed a Guarantor hereunder for
purposes of determining the rights and obligations hereunder.

                              ARTICLE 5. SUCCESSORS

Section 5.01.  Merger, Consolidation, or Sale of Assets.

         The Company shall not, directly or indirectly, consolidate or merge
with or into (whether
<PAGE>   70
                                                                              70

or not the Company is the surviving corporation), or sell, assign, transfer,
convey or otherwise dispose of all or substantially all of its properties and
assets, in one or more related transactions, to another Person unless: (i) the
Company is the surviving corporation or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States, any state
thereof or the District of Columbia, or Bermuda; (ii) the Person formed by or
surviving any such consolidation or merger (if other than the Company) or the
Person to which such sale, assignment, transfer, conveyance or other disposition
shall have been made assumes all the obligations of the Company under the
Registration Rights Agreement, the Securities and this Indenture pursuant to a
supplemental indenture in a form and substance reasonably satisfactory to the
Trustee; (iii) immediately after such transaction no Default or Event of Default
exists; and (iv) except in the case of a merger of the Company with or into a
Restricted Subsidiary of the Company, the Company or the Person formed by or
surviving any such consolidation or merger (if other than the Company), or to
which such sale, assignment, transfer, conveyance or other disposition shall
have been made will, immediately after such transaction and after giving pro
forma effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the first paragraph
of Section 4.09 hereof or the Consolidated Leverage Ratio would be no greater
than such ratio immediately prior to such transaction if the ratio prior to such
transaction is positive or greater than or equal to such ratio if the ratio
prior to such transaction is negative. The Company shall not, directly or
indirectly, lease all or substantially all of its properties or assets, in one
or more related transactions, to any other Person. The provisions of this
covenant will not be applicable to a sale, assignment, transfer, conveyance or
other disposition of assets between or among the Company and its Restricted
Subsidiaries.

Section 5.02.  Successor Corporation Substituted.

         Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 5.01 hereof, the successor corporation
formed by such consolidation or into or with which the Company is merged or to
which such sale, assignment, transfer, lease, conveyance or other disposition is
made shall succeed to, and be substituted for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Securities except in the case of a sale of all
of the Company's assets that meets the requirements of Section 5.01 hereof.

                        ARTICLE 6. DEFAULTS AND REMEDIES

Section 6.01.  Events of Default.
<PAGE>   71
                                                                              71

         "Events of Default" wherever used herein with respect to any series of
Securities means any one of the following events:

         (i) default for 30 days in the payment when due of interest on the
    Securities of such series;

         (ii) default in the payment when due of the principal of, or premium,
    if any, on, the Securities of such series;

         (iii) default in the payment of principal and interest on any
    Securities required to be purchased pursuant to Sections 4.10 and 4.14 or
    the failure by the Company or any of its Restricted Subsidiaries to comply
    with Section 5.01;

         (iv) failure by the Company or any of its Restricted Subsidiaries for
    60 days after written notice from the Trustee or holders of 25% or more of
    the aggregate principal amount of the Securities of a series to comply with
    any of its other agreements in this Indenture with respect to the Securities
    of such series or the Securities of such series;

         (v) default under any mortgage, indenture or instrument under which
    there may be issued or by which there may be secured or evidenced any
    Indebtedness for money borrowed by the Company or any of its Subsidiaries
    (or the payment of which is guaranteed by the Company or any of its
    Subsidiaries) whether such Indebtedness or guarantee now exists, or is
    created after the date of this Indenture, which default shall constitute
    failure to pay the principal of such Indebtedness at Stated Maturity (after
    giving effect to any applicable grace periods and any extensions thereof) or
    results in the acceleration of such Indebtedness prior to its Stated
    Maturity and, in each case, the principal amount of any such other
    Indebtedness, together with the principal amount of any other such
    Indebtedness which has not been paid or the maturity of which has been so
    accelerated, aggregates $25.0 million or more;

         (vi) failure by the Company or any of its Restricted Subsidiaries to
    pay final judgments not subject to appeal aggregating in excess of $25.0
    million (net of applicable insurance coverage which is acknowledged in
    writing by the insurer), which judgments are not paid, discharged or stayed
    for a period of 60 days following the entry of the final judgment or order
    that causes the aggregate amount for all such final judgments or orders
    outstanding and not paid, discharged or stayed to exceed $25.0 million;

         (vii) except as provided by this Indenture, any Guarantee of the
    Securities by a Significant Subsidiary or any group of Restricted
    Subsidiaries that, taken together, would constitute a Significant Subsidiary
    shall be held in any judicial proceeding to be unenforceable or invalid or
    shall cease for any reason to be in full force and effect or any Guarantor
    that is a Significant Subsidiary or any group of Guarantors that, taken
    together, would constitute a Significant Subsidiary , or any Person acting
    on behalf of any Guarantor or Guarantors, shall deny or disaffirm its
    obligations under its Guarantee of the Securities of such series;
<PAGE>   72
                                                                              72

         (viii)  the Company or any Restricted Subsidiary that is a Significant
    Subsidiary or any group of Restricted Subsidiaries that, taken together,
    would constitute a Significant Subsidiary:

                 (a) commences a voluntary case,

                 (b) consents to the entry of an order for relief against it in
         an involuntary case,

                 (c) consents to the appointment of a custodian of it or for all
         or substantially all of its property,

                 (d) makes a general assignment for the benefit of its
         creditors, or

                 (e) generally is not paying its debts as they become due; and

         (ix)    a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:

                 (a) is for relief against the Company or any Restricted
         Subsidiary that is a Significant Subsidiary or any group of Restricted
         Subsidiaries that, taken together, would constitute a Significant
         Subsidiary,

                 (b) appoints a custodian of the Company or any Restricted
         Subsidiary that is a Significant Subsidiary or any group of Restricted
         Subsidiaries that, taken together, would constitute a Significant
         Subsidiary; or

                 (c) orders the liquidation of the Company or any Restricted
         Subsidiary that is a Significant Subsidiary or any group of Restricted
         Subsidiaries that, taken together, would constitute a Significant
         Subsidiary;

                 and the order or decree remains unstayed and in effect for 60
         consecutive days.

Section 6.02.  Acceleration.

         If any Event of Default with respect to outstanding Securities of any
series occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Securities of such series, by written
notice to the Company, may declare all the Securities of such series to be due
and payable immediately. Notwithstanding the foregoing, if an Event of Default
specified in clause (viii) or (ix) of Section 6.01 hereof with respect to
outstanding Securities of any series occurs with respect to the Company, any
Restricted Subsidiary that constitutes a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Subsidiary, all outstanding Securities of such series shall be due and payable
immediately without further action or notice. The Holders of a majority in
aggregate principal amount of the then outstanding Securities of such series by
<PAGE>   73
                                                                              73

written notice to the Trustee may on behalf of all of the Holders of Securities
of such series rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium that has become due
solely because of the acceleration) have been cured or waived.

         If an Event of Default with respect to outstanding Notes Due 2010
occurs by reason of any willful action (or inaction) taken (or not taken) by or
on behalf of the Company with the intention of avoiding payment of the premium
that the Company would have had to pay if the Company then had elected to redeem
the Notes Due 2010 pursuant to Section 3.07 hereof, then, upon acceleration of
the Securities, an equivalent premium shall also become and be immediately due
and payable to Holders of Notes Due 2010, to the extent permitted by law,
anything in this Indenture or in the Securities to the contrary notwithstanding.
If an Event of Default occurs prior to ____________, 2005 by reason of any
willful action (or inaction) taken (or not taken) by or on behalf of the Company
with the intention of avoiding the prohibition on redemption of the Notes Due
2010 prior to such date, then, upon acceleration of the Securities, an
additional premium shall also become and be immediately due and payable in an
amount, for each of the years beginning on [_______] of the years set forth
below, as set forth below (expressed as a percentage of the aggregate principal
amount to the date of payment that would otherwise be due but for the provisions
of this sentence):

<TABLE>
<CAPTION>
              Year                                      Percentage
              ----                                      ----------
<S>                                                     <C>
              2000__________%
              2001__________%
              2002__________%
              2003__________%
              2004__________%
</TABLE>

Section 6.03.  Other Remedies.

         If an Event of Default with respect to outstanding Securities of any
series occurs and is continuing, the Trustee may pursue any available remedy to
collect the payment of principal, premium, if any, and interest and Special
Interest, if any, on the Securities of such series or to enforce the performance
of any provision of the Securities or this Indenture.

         The Trustee may maintain a proceeding even if it does not possess any
of the Securities of such series or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Holder of a Note of such
series in exercising any right or remedy accruing upon an Event of Default shall
not impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. All remedies are cumulative to the extent permitted by law.

Section 6.04.  Waiver of Past Defaults.

         Holders of not less than a majority in aggregate principal amount of
the then outstanding Securities of any series by notice to the Trustee may on
behalf of the Holders of all of the
<PAGE>   74
                                                                              74

Securities of such series waive an existing Default or Event of Default with
respect to such series and its consequences hereunder, except a continuing
Default or Event of Default in the payment of the principal of, premium and
Special Interest, if any, or interest on, the Securities of such series
(including in connection with an offer to purchase) (except a rescission of
acceleration of the Securities by the Holders of at least a majority in
aggregate principal amount thereof and waiver of the payment default that
resulted from such acceleration). Upon any such waiver, such Default shall cease
to exist with respect to such series, and any Event of Default with respect to
such series arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.

Section 6.05.  Control by Majority.

         Holders of a majority in principal amount of the then outstanding
Securities of any series may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Securities or that
may involve the Trustee in personal liability.

Section 6.06.  Limitation on Suits.

         A Holder of a Note of any series may pursue a remedy with respect to
this Indenture to the extent it relates to the Securities of such series, or the
Securities of such series only if:

         (a) the Holder gives to the Trustee written notice of a continuing
Event of Default with respect to such series;

         (b) the Holders of at least 25% in principal amount of the then
outstanding Securities of such series make a written request to the Trustee to
pursue the remedy;

         (c) such Holder of a Note or Holders of Securities offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;

         (d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and

         (e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Securities of such series do not give the Trustee
a direction inconsistent with the request.

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

Section 6.07.  Rights of Holders of Securities to Receive Payment.
<PAGE>   75
                                                                              75

         Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium and Special Interest,
if any, and interest on the Note, on or after the respective due dates expressed
in the Note (including in connection with an offer to purchase), or to bring
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of such Holder.

Section 6.08.  Collection Suit by Trustee.

         If an Event of Default specified in Section 6.01(i) or (ii) hereof
occurs and is continuing with respect to the Securities of any series, the
Trustee is authorized to recover judgment in its own name and as trustee of an
express trust against the Company for the whole amount of principal of, premium
and Special Interest, if any, and interest remaining unpaid on the Securities of
such series and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.

Section 6.09.  Trustee May File Proofs of Claim.

         The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Securities allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Securities), its creditors or its
property and shall be entitled and empowered to participate as a member, voting
or otherwise, of any official committee of creditors appointed in such matter
and shall be entitled and empowered to collect, receive and distribute any money
or other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.

Section 6.10.  Priorities.

         If the Trustee collects any money with respect to a series of
Securities pursuant to this Article 6, it shall pay out the money in the
following order:
<PAGE>   76
                                                                              76

         First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;

         Second: to Holders of Securities of such series for amounts due and
unpaid on the Securities of such series for principal, premium and Special
Interest, if any, and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities of such series
for principal, premium and Special Interest, if any, and interest, respectively;
and

         Third: to the Company or to such party as a court of competent
jurisdiction shall direct.

         The Trustee may fix a record date and payment date for any payment to
Holders of Securities pursuant to this Section 6.10.

Section 6.11.  Undertaking for Costs.

         In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of
a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Securities of any series.

                               ARTICLE 7. TRUSTEE

Section 7.01.  Duties of Trustee.

         (a) If an Event of Default with respect to any series of Securities has
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree of care and skill
in its exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs.

         (b) Except during the continuance of an Event of Default:

         (i) the duties of the Trustee shall be determined solely by the express
    provisions of this Indenture and the Trustee need perform only those duties
    that are specifically set forth in this Indenture and no others, and no
    implied covenants or obligations shall be read into this Indenture against
    the Trustee; and

         (ii) in the absence of bad faith on its part, the Trustee may
    conclusively rely, as to the truth of the statements and the correctness of
    the opinions expressed therein, upon
<PAGE>   77
                                                                              77

    certificates or opinions furnished to the Trustee and conforming to the
    requirements of this Indenture. However, the Trustee shall examine the
    certificates and opinions to determine whether or not they conform to
    the requirements of this Indenture (but need not confirm or investigate
    the accuracy of mathematical calculations or other facts stated therein
    or otherwise verify the contents thereof).

         (c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

         (i) this paragraph does not limit the effect of paragraph (b) of this
    Section 7.01;

         (ii) the Trustee shall not be liable for any error of judgment made in
    good faith by a Responsible Officer, unless it is proved that the Trustee
    was negligent in ascertaining the pertinent facts; and

         (iii) the Trustee shall not be liable with respect to any action it
    takes or omits to take in good faith in accordance with a direction received
    by it pursuant to Section 6.05 hereof.

         (d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.

         (e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or expense
including reasonable attorneys' fees that might be incurred by it in compliance
with such request or direction.

         (f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.

Section 7.02.  Rights of Trustee.

         (a) The Trustee may conclusively rely upon any document believed by it
    to be genuine and to have been signed or presented by the proper Person. The
    Trustee need not investigate any fact or matter stated in the document. The
    Trustee shall receive and retain financial reports and statements of the
    Company as provided herein, but it shall have no duty to review or analyze
    such reports or statements to determine compliance with covenants or other
    obligations of the Company.

         (b) Before the Trustee acts or refrains from acting, it may require an
    Officers' Certificate or an Opinion of Counsel or both. The Trustee shall
    not be liable for any action it takes or omits to take in good faith in
    reliance on such Officers' Certificate or Opinion of Counsel. The Trustee
    may consult with counsel of its selection and the advice of such counsel or
    any Opinion of Counsel shall be full and complete authorization and
    protection
<PAGE>   78
                                                                              78

    from liability in respect of any action taken, suffered or omitted by
    it hereunder in good faith and in reliance thereon.

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

         (d) The Trustee shall not be liable for any action it takes or omits to
    take in good faith that it believes to be authorized or within the rights or
    powers conferred upon it by this Indenture.

         (e) Unless otherwise specifically provided in this Indenture, any
    demand, request, direction or notice from the Company shall be sufficient if
    signed by an Officer of the Company.

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

Section 7.03.  Individual Rights of Trustee.

         The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.

Section 7.04.  Trustee's Disclaimer.

         The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities or any
money paid to the Company or upon the Company's direction under any provision of
this Indenture, it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the
Securities or any other document in connection with the sale of the Securities
or pursuant to this Indenture other than its certificate of authentication.

Section 7.05.  Notice of Defaults.

         (a) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this
<PAGE>   79
                                                                              79

Indenture.

         (b) If a Default or Event of Default with respect to a series of
Securities occurs and is continuing and if it is known to the Trustee, the
Trustee shall mail to Holders of such series of Securities a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders of such series of Securities.

Section 7.06.  Reports by Trustee to Holders of the Securities.

         Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Securities remain outstanding,
the Trustee shall mail to the Holders of the Securities a brief report dated as
of such reporting date that complies with TIA Section 313(a) (but if no event
described in TIA Section 313(a) has occurred within the twelve months preceding
the reporting date, no report need be transmitted). The Trustee also shall
comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail all
reports as required by TIA Section 313(c).

         A copy of each report at the time of its mailing to the Holders of
Securities shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Securities are listed in accordance with TIA Section
313(d). The Company shall promptly notify the Trustee when the Securities are
listed on any stock exchange.

Section 7.07.  Compensation and Indemnity.

         The Company shall pay to the Trustee from time to time such
compensation for its acceptance of this Indenture and services hereunder as the
parties shall agree from time to time. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Trustee promptly upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.

         The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable
<PAGE>   80
                                                                              80

fees and expenses of such counsel. The Company need not pay for any settlement
made without its consent, which consent shall not be unreasonably withheld or
delayed.

         The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.

         To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Securities. Such Lien shall survive the satisfaction and
discharge of this Indenture.

         When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(viii) or (ix) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.

         The Trustee shall comply with the provisions of TIA Section 313(b)(2)
to the extent applicable.

Section 7.08.  Replacement of Trustee.

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

         The Trustee may resign in writing at any time and be discharged from
the trust hereby created with respect to one or more series of Securities by so
notifying the Company. The Holders of a majority in principal amount of the then
outstanding Securities of any series may remove the Trustee with respect to such
series by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee with respect to one or more series of Securities if:

         (a) the Trustee fails to comply with Section 7.10 hereof;

         (b) the Trustee is adjudged a bankrupt or an insolvent or an order for
    relief is entered with respect to the Trustee under any Bankruptcy Law;

         (c) a custodian or public officer takes charge of the Trustee or its
    property; or

         (d) the Trustee becomes incapable of acting.

         If, as to any series of Securities, the Trustee resigns or is removed
or if a vacancy exists in the office of Trustee for any reason, the Company
shall promptly appoint a successor Trustee for such series of Securities. Within
one year after the successor Trustee takes office, the Holders of a majority in
principal amount of the then outstanding Securities of such series may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
<PAGE>   81
                                                                              81

         If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Securities of at least 10% in principal amount of the then
outstanding Securities of such series may petition any court of competent
jurisdiction for the appointment of a successor Trustee for such series of
Securities.

         If the Trustee, after written request by any Holder of a Note of any
series who has been a Holder of a Note of such series for at least six months,
fails to comply with Section 7.10 hereof, such Holder of a Note may petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee for such series of Securities.

         In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one but not all series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one series
shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which shall:

         (a) contain such provisions as shall be necessary of desirable to
transfer and confirm to, and to vest in, each successor Trustee all the rights,
powers, trusts and duties of the retiring Trustee with respect to the Securities
of the series to which the appointment of such successor Trustee relates;

         (b) contain such provisions as shall be necessary or desirable to
confirm that all the rights, powers, trusts and duties of the retiring Trustee
with respect to the Securities of the series as to which the retiring Trustee is
not retiring shall continue to be vested in the retiring Trustee; and

         (c) add to or change any of the provisions of this Indenture as shall
be necessary or desirable to provide for or facilitate the administration of the
trusts hereunder by two Trustees; provided, however, that nothing contained
herein or in such supplemental Indenture shall constitute such Trustee to be
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust hereunder separate and apart from any trust hereunder administered by the
other such Trustee.

         Upon the execution and delivery of such supplemental Indenture, the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Securities of that series to
which the appointment of such successor Trustee relates. The successor Trustee
shall mail a notice of its succession to Holders of the Securities of such
series. The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
<PAGE>   82
                                                                              82

Section 7.09.  Successor Trustee by Merger, etc.

         If the Trustee as to any series of Securities consolidates, merges or
converts into, or transfers all or substantially all of its corporate trust
business to, another corporation, the successor corporation without any further
act shall be the successor Trustee as to such series of Securities.

Section 7.10.  Eligibility; Disqualification.

         There shall at all times be a Trustee hereunder with respect to each
series of Securities that is a corporation organized and doing business under
the laws of the United States of America or of any state thereof that is
authorized under such laws to exercise corporate trustee power, that is subject
to supervision or examination by federal or state authorities and that has a
combined capital and surplus of at least $100.0 million as set forth in its most
recent published annual report of condition.

         This Indenture shall always have a Trustee with respect to each series
of Securities who satisfies the requirements of TIA Section 310(a)(1), (2) and
(5). The Trustee is subject to TIA Section 310(b).

Section 7.11.  Preferential Collection of Claims Against Company.

         The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.

               ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01.  Option to Effect Legal Defeasance or Covenant Defeasance.

         The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof applied to all outstanding Securities of any
series upon compliance with the conditions set forth below in this Article 8.

Section 8.02.  Legal Defeasance and Discharge.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Securities of
any series on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that
the Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Securities of such series, which shall thereafter
be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and
the other Sections of this Indenture referred to
<PAGE>   83
                                                                              83

in (a) and (b) below, and to have satisfied all of its obligations under such
Securities and this Indenture (and the Trustee, on demand of and at the expense
of the Company, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Securities of
such series to receive payments in respect of the principal of, premium, if any,
and interest on such Securities when such payments are due from the trust
referred to below; (b) the Company's obligations with respect to the Securities
of such series concerning issuing temporary Securities, registration of
Securities, mutilated, destroyed, lost or stolen Securities and the maintenance
of an office or agency for payment and money for security payments held in
trust; (c) the rights, powers, trusts, duties and immunities of the Trustee, and
the Company's obligations in connection therewith; and (d) the Legal Defeasance
provisions of this Indenture. Subject to compliance with this Article 8, the
Company may exercise its option under this Section 8.02 notwithstanding the
prior exercise of its option under Section 8.03 hereof.

Section 8.03.  Covenant Defeasance.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and each Guarantor shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from their respective obligations under the covenants contained in
Article 5 and in Sections 4.03, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.14, 4.15,
4.16, 4.17, 4.18 and 4.19 hereof with respect to the outstanding Securities of
any series on and after the date the conditions set forth in Section 8.04 are
satisfied (hereinafter, "Covenant Defeasance"), and the Securities of such
series shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Securities shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Securities of such series, the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03, subject to the satisfaction of the conditions set forth in Section
8.04 hereof, Sections 6.01(iii) through 6.01(vii) hereof and 6.01(x) hereof
shall not constitute Events of Default.

Section 8.04.  Conditions to Legal or Covenant Defeasance.

         The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Securities of any series:

         In order to exercise either Legal Defeasance or Covenant Defeasance:
<PAGE>   84
                                                                              84

         (a) the Company must irrevocably deposit, or cause to be deposited,
with the Trustee, in trust, for the benefit of the Holders of the Securities of
such series, cash in U.S. dollars, non-callable Government Securities, or a
combination thereof, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest due on the outstanding Securities of
such series on the Stated Maturity thereof or on the applicable redemption date,
as the case may be, and the Company must specify whether the Securities of such
series are being defeased to maturity or to a particular redemption date;

         (b) in the case of Legal Defeasance, the Company must deliver to the
Trustee an Opinion of Counsel (which may be subject to customary assumptions and
exclusions) in the United States reasonably acceptable to the Trustee confirming
that the Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or since the date of this Indenture, there has been a
change in the applicable federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm that, the Holders
of the outstanding Securities of such series will not recognize income, gain or
loss for federal income tax purposes as a result of such Legal Defeasance, and
will be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Legal Defeasance had
not occurred;

         (c) in the case of Covenant Defeasance, the Company must deliver to the
Trustee an Opinion of Counsel in the United States reasonably acceptable to the
of the outstanding Securities of such series will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance,
and such Holders will be subject to federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such
Covenant Defeasance had not occurred;

         (d) no Default or Event of Default with respect to such series shall
have occurred and be continuing on the date of such deposit (other than a
Default or Event of Default resulting from the borrowing of funds to be applied
to such deposit) or insofar as Events of Default from bankruptcy or insolvency
events are concerned, at any time in the period ending on the 91st day after the
date of deposit;

         (e) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;

         (f) the Company must deliver to the Trustee an Opinion of Counsel
(which may be subject to customary assumptions and exclusions) in the United
States reasonably acceptable to the Trustee to the effect that after the 91st
day following the deposit, the trust funds will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights and remedies generally;

         (g) the Company must deliver to the Trustee an Officers' Certificate
stating that the
<PAGE>   85
                                                                              85

deposit was not made by the Company with the intent of preferring the Holders of
the Securities of such series over other creditors of the Company, or with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others;

         (h) the Company must deliver to the Trustee an Opinion of Counsel in
Bermuda reasonably acceptable to the Trustee to the effect that the Holders of
the outstanding Securities will not be adversely affected under Bermuda law; and

         (i) the Company must deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel in the United States reasonably acceptable to the
Trustee, each stating that all conditions precedent provided for or relating to
Legal Defeasance or Covenant Defeasance, as applicable, have been complied with.

SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.

         Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as Paying
Agent) as the Trustee may determine, to the Holders of such Securities of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.

         The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding
Securities.

         Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

SECTION 8.06.  REPAYMENT TO COMPANY.

         Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, interest
or Special Interest, if any, on any Note and remaining unclaimed for two years
after such principal, and premium, if any, or interest has become due and
payable shall be paid to the Company on its request or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Note shall
thereafter, as a secured creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Company.

SECTION 8.07.  REINSTATEMENT.
<PAGE>   86
                                                                              86

         If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying
Agent is permitted to apply all such money in accordance with Section 8.02 or
8.03 hereof, as the case may be; provided, however, that, if the Company makes
any payment of principal of, premium, if any, or interest on any Note following
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
held by the Trustee or Paying Agent.

SECTION 8.08.  SURVIVAL.

         The Trustee's rights under this Article 8 shall survive termination of
this Indenture.

                   ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER

SECTION 9.01.  WITHOUT CONSENT OF HOLDERS OF SECURITIES.

         Notwithstanding Section 9.02 hereof, the Company, the Guarantors and
the Trustee may amend or supplement this Indenture, the Guarantees or the
Securities without the consent of any Holder of a Note:

         (a) to cure any ambiguity, defect or inconsistency;

         (b) to provide for uncertificated Securities in addition to or in place
of certificated Securities or to alter the provisions of Article 2 hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;

         (c) to provide for the assumption of the Company's or any Guarantor's
obligations to the Holders of the Securities by a successor to the Company or a
Guarantor pursuant to Article 5 or Article 10 hereof;

         (d) to make any change that would provide any additional rights or
benefits to the Holders of the Securities or that does not adversely affect the
legal rights hereunder of any Holder of a Note, in the good faith judgment of
the Board of Directors;

         (e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;

         (f) to allow any Guarantor to execute a supplemental indenture and/or a
Guarantee with respect to the Securities;

         (g) to add to, change or eliminate any of the provisions of this
Indenture in respect of
<PAGE>   87
                                                                              87

one or more series of Securities, provided that any such addition, change or
elimination (A) shall neither (i) apply to any Note of any series created prior
to the execution of such supplemental indenture and entitled to the benefit of
such provision nor (ii) modify the rights of the Holder of any such Note with
respect to such provision or (B) shall become effective only when there is no
such Note outstanding;

         (h) to establish the form or terms of Securities of any series as
permitted by Article 2;

         (i) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee with respect to the Securities of one or more series and
to add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee.

         Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company and the Guarantors in the
execution of any amended or supplemental indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.

SECTION 9.02.  WITH CONSENT OF HOLDERS OF SECURITIES.

         Except as provided below in this Section 9.02, the Company, a Guarantor
(with respect to a Guarantee or this Indenture to which it is a party) and the
Trustee may amend or supplement this Indenture (including Section 3.11, 4.10 and
4.15 hereof), the Securities and the Guarantees with the consent of the Holders
of at least a majority in principal amount of the then outstanding Securities of
each series affected thereby voting as a single class (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Securities), and, subject to Sections 6.04 and 6.07 hereof, any existing
Default or Event of Default with respect to any series of Securities (other than
a Default or Event of Default in the payment of the principal of, premium, if
any, or interest on the Securities, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of this
Indenture, the Securities or the Guarantees may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Securities
of each series affected thereby voting as a single class (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Securities).

         Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Securities of each series affected
thereby as aforesaid, and upon receipt by the Trustee of the documents described
in Section 7.02 hereof, the Trustee shall join with the Company in the execution
of such amended or supplemental indenture unless such amended or supplemental
<PAGE>   88
                                                                              88

indenture directly affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may in its discretion,
but shall not be obligated to, enter into such amended or supplemental
indenture.

         A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Securities, or which modifies
the rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.

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

         After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of Securities affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the then outstanding
Securities of each series affected thereby voting as a single class may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Securities. However, without the consent of each Holder
affected, an amendment or waiver under this Section 9.02 may not (with respect
to any Securities held by a non-consenting Holder):

         (a) reduce the principal amount of Securities of each series whose
Holders must consent to an amendment, supplement or waiver;

         (b) reduce the principal of or change the fixed maturity of any Note or
alter or waive any of the provisions with respect to the redemption of the
Securities of any series, other than provisions relating to Sections 3.11 or
4.15 hereof;

         (c) reduce the rate of or change the time for payment of interest,
including default interest, on any Note;

         (d) waive a Default or Event of Default in the payment of principal of
or premium or Special Interest, if any, or interest on the Securities of any
series (except a rescission of acceleration of the Securities by the Holders of
at least a majority in aggregate principal amount of the then outstanding
Securities of each series and a waiver of the payment default that resulted from
such acceleration;

         (e) make any Note payable in money other than that stated in the
Securities;

         (f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Securities to receive
payments of principal of or premium, interest or Special Interest, if any, on
the Securities;
<PAGE>   89
                                                                              89

         (g) waive a redemption payment with respect to any Note, other than a
payment required by Section 3.11 or 4.15 hereof;

         (h) make any change in the foregoing amendment and waiver provisions.

SECTION 9.03.  COMPLIANCE WITH TRUST INDENTURE ACT.

         Every amendment or supplement to this Indenture or the Securities shall
be set forth in a amended or supplemental indenture that complies with the TIA
as then in effect.

SECTION 9.04.  REVOCATION AND EFFECT OF CONSENTS.

         Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.

SECTION 9.05.  NOTATION ON OR EXCHANGE OF SECURITIES.

         The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Securities may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Securities of the same series that
reflect the amendment, supplement or waiver.

         Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.

SECTION 9.06.  TRUSTEE TO SIGN AMENDMENTS, ETC.

         The Trustee shall sign any amended or supplemental indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in relying upon an Officer's Certificate and an Opinion of Counsel
stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture and that such amendment is the legal,
valid and binding obligation of the Company and any Guarantors, enforceable
against them in accordance with their terms, subject to customary exceptions,
and complies with the provisions hereof (including Section 9.03).
<PAGE>   90
                                                                              90

SECTION 9.07.  EFFECT OF SUPPLEMENTAL INDENTURES.

         Upon the execution of any supplemental indenture under this Article 9,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

SECTION 9.08.  REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.

         Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article 9 may, and
shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities of any series so modified as to
conform, in the opinion of the Trust and the Company, to any such supplemental
indenture may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for outstanding Securities of such series.

                             ARTICLE 10. GUARANTEES

SECTION 10.01.  GUARANTEE.

         Subject to this Article 10, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the
Securities or the obligations of the Company hereunder or thereunder, that: (a)
the principal of and interest on the Securities will be promptly paid in full
when due, whether at maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on the Securities, if any, if
lawful, and all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (b) in case of any extension
of time of payment or renewal of any Securities or any of such other
obligations, that same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same immediately.
Each Guarantor agrees that this is a guarantee of payment and not a guarantee of
collection.

         The Guarantors hereby agree that their obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Securities or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Guarantee shall not be discharged except by complete
performance of the obligations
<PAGE>   91
                                                                              91

contained in the Securities and this Indenture.

         If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.

         Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (y) in the event of any declaration of acceleration of
such obligations as provided in Article 6 hereof, such obligations (whether or
not due and payable) shall forthwith become due and payable by the Guarantors
for the purpose of this Guarantee. The Guarantors shall have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Guarantee.

SECTION 10.02.  LIMITATION ON GUARANTOR LIABILITY.

         Each Guarantor, and by its acceptance of Securities, each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
of such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law to the extent
applicable to any Guarantee. To effectuate the foregoing intention, the Trustee,
the Holders and the Guarantors hereby irrevocably agree that the obligations of
such Guarantor under its Guarantee and this Article 10 shall be limited to the
maximum amount as will, after giving effect to such maximum amount and all other
contingent and fixed liabilities of such Guarantor that are relevant under such
laws, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under this Article 10, result
in the obligations of such Guarantor under its Guarantee not constituting a
fraudulent transfer or conveyance.

SECTION 10.03.  EXECUTION AND DELIVERY OF GUARANTEE.

         To evidence its Guarantee set forth in Section 10.01, each Guarantor
hereby agrees that a notation of such Guarantee substantially in the form
included in Exhibit D shall be endorsed by an Officer of such Guarantor on each
Note authenticated and delivered by the Trustee and that this Indenture shall be
executed on behalf of such Guarantor by an Officer thereof.

         Each Guarantor hereby agrees that its Guarantee set forth in Section
10.01 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such
<PAGE>   92
                                                                              92

Guarantee.

         If an Officer whose signature is on this Indenture or on the Guarantee
no longer holds that office at the time the Trustee authenticates the Note on
which a Guarantee is endorsed, the Guarantee shall be valid nevertheless.

         The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this Indenture on behalf of the Guarantors.

         In the event that any Restricted Subsidiary guarantees any Debt
Securities issued by the Company subsequent to the date of this Indenture, if
required by Section 4.22 hereof, the Company shall cause such Restricted
Subsidiary to execute supplemental indentures to this Indenture and Guarantees
in accordance with Section 4.22 hereof, and this Article 10, to the extent
applicable.

SECTION 10.04.  GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.

         No Guarantor may consolidate with or merge with or into (whether or not
such Guarantor is the surviving Person) another Person whether or not affiliated
with such Guarantor unless:

         (a) subject to Section 10.05 hereof, the Person formed by or surviving
any such consolidation or merger (if other than a Guarantor or the Company)
unconditionally assumes all the obligations of such Guarantor, pursuant to a
supplemental indenture in form and substance reasonably satisfactory to the
Trustee, under the Securities, this Indenture, the Registration Rights Agreement
and the Guarantee on the terms set forth herein or therein; and

         (b) immediately after giving effect to such transaction, no Default or
Event of Default exists.

         In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Guarantee endorsed upon the Securities and the due and punctual performance of
all of the covenants and conditions of this Indenture to be performed by the
Guarantor, such successor Person shall succeed to and be substituted for the
Guarantor with the same effect as if it had been named herein as a Guarantor.
Such successor Person thereupon may cause to be signed any or all of the
Guarantees to be endorsed upon all of the Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee. All the Guarantees so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Guarantees theretofore and
thereafter issued in accordance with the terms of this Indenture as though all
of such Guarantees had been issued at the date of the execution hereof.

         Notwithstanding clauses (a) and (b) above, nothing contained in this
Indenture or in any of the Securities shall prevent any consolidation or merger
of a Guarantor with or into the Company or another Guarantor, or shall prevent
any sale or conveyance of the property of a
<PAGE>   93
                                                                              93

Guarantor as an entirety or substantially as an entirety to the Company, another
Guarantor or a Restricted Subsidiary.

SECTION 10.05.  RELEASES FOLLOWING SALE OF ASSETS.

         In the event of a sale or other disposition of all of the assets of any
Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all of the capital stock of any Guarantor, then such Guarantor
(in the event of a sale or other disposition, by way of such a merger,
consolidation or otherwise, of all of the capital stock of such Guarantor) or
the Person acquiring the property (in the event of a sale or other disposition
of all or substantially all of the assets of such Guarantor) will be released
and relieved of any obligations under its Guarantee; provided that the Net
Proceeds of such sale or other disposition are applied in accordance with the
applicable provisions of this Indenture, including without limitation Section
4.10 hereof. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the applicable provisions
of this Indenture, including without limitation Section 4.10 hereof, the Trustee
shall execute any documents reasonably required in order to evidence the release
of any Guarantor from its obligations under its Guarantee.

         Any Guarantor not released from its obligations under its Guarantee
shall remain liable for the full amount of principal of and interest on the
Securities and for the other obligations of any Guarantor under this Indenture
as provided in this Article 10.

                     ARTICLE 11. SATISFACTION AND DISCHARGE

SECTION 11.01.  SATISFACTION AND DISCHARGE OF INDENTURE.

         This Indenture shall be discharged and will cease to be of further
effect as to all Securities of any series issued hereunder, when either

         (a) all such Securities theretofore authenticated and delivered (except
lost, stolen or destroyed Securities which have been replaced or paid and
Securities for whose payment money has theretofore been deposited in trust and
thereafter repaid to the Company) have been delivered to the Trustee for
cancellation; or

         (b)

         (i)      all Securities of such series not theretofore delivered to
                  such Trustee for cancellation have become due and payable by
                  reason of the making of a notice of redemption or otherwise or
                  will become due and payable within one year and the Company or
                  a Guarantor, has irrevocably deposited or caused to be
                  deposited with such Trustee as trust funds in trust an amount
                  of money sufficient to pay and discharge the entire
                  Indebtedness on such Securities not theretofore delivered to
                  the Trustee for cancellation for principal, premium, accrued
                  interest and Special Interest, if any, to the date of maturity
<PAGE>   94
                                                                              94

                  or redemption;

         (ii)     no Default or Event of Default with respect to this Indenture,
                  so far as it relates to the Securities of such series, or the
                  Securities of such series shall have occurred and be
                  continuing on the date of such deposit or shall occur as a
                  result of such deposit and such deposit will not result in a
                  breach or violation of, or constitute a default under, any
                  other instrument to which the Company or a Guarantor, is a
                  party or by which the Company or a Guarantor is bound;

         (iii)    the Company or a Guarantor has paid or caused to be paid all
                  sums payable by it under this Indenture in respect of the
                  Securities such series; and

         (iv)     the Company has delivered irrevocable instructions to the
                  Trustee under this Indenture to apply the deposited money
                  toward the payment of the Securities of such series at
                  maturity or the redemption date, as the case may be.

         In addition, the Company must deliver an Officers' Certificate and an
Opinion of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge with respect to the Securities of such series have
been satisfied.

SECTION 11.02.  APPLICATION OF TRUST MONEY.

         Subject to the provisions of the last paragraph of Section 4.19 hereof,
all money deposited with the Trustee pursuant to Section 11.01 hereof shall be
held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as Paying Agent) as the Trustee may
determine, to Persons entitled thereto, of the principal (and premium, if any),
interest and Special Interest, if any, for whose payment such money has been
deposited with the Trustee.

         If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 11.01 hereof by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Securities
shall be revived and reinstated as though such deposit had occurred pursuant to
Section 11.01 hereof; provided that if the Company has made any payment of
principal of, premium, if any, or interest on any Securities because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the money or
Government Securities held by the Trustee or Paying Agent.

                            ARTICLE 12. MISCELLANEOUS

SECTION 12.01.  TRUST INDENTURE ACT CONTROLS.

         If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by
<PAGE>   95
                                                                              95

TIA Section 318(c), the imposed duties shall control.

SECTION 12.02.  NOTICES.

         Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:

         If to the Company and/or any Guarantor:

                  Asia Global Crossing Ltd.
                  Wessex House
                  45 Reid Street
                  Hamilton HM 12 Bermuda
                  Telecopier No.: (441) 296-8606
                  Attention: Secretary of the Company

         With a copy to:

                  Simpson Thacher & Bartlett
                  425 Lexington Avenue
                  New York, NY  10017
                  Telecopier No.:  (212) 455-2502
                  Attention:  Alan Klein, Esq.

         If to the Trustee:

                  United States Trust Company of New York
                  114 West 47th Street - 25th Floor
                  New York, New York  10036
                  Telecopier No.:(212) 852-1626
                  Attention:  Cynthia Chaney

         With a copy to:

                  [Winston & Strawn
                  200 Park Avenue
                  New York, NY 10166
                  Telecopier No.:(212) 294-4700
                  Attention:  Jeffrey H. Elkin, Esq.]

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

         All notices and communications (other than those sent to Holders) shall
be deemed to
<PAGE>   96
                                                                              96

have been duly given: at the time delivered by hand, if personally delivered;
five Business Days after being deposited in the mail, postage prepaid, if
mailed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.

         Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.

         If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it except that any notice or communication to the Trustee shall be
deemed to have been duly given to the Trustee when received at the Corporate
Trust Office of the Trustee.

         If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.

SECTION 12.03. COMMUNICATION BY HOLDERS OF SECURITIES WITH OTHER HOLDERS OF
SECURITIES.

         Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).

SECTION 12.04.  CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

         Upon any request or application by the Company to the Trustee to take
any action under this Indenture, except with respect to the initial
authentication of Securities on the date of this Indenture, the Company shall
furnish to the Trustee:

         (a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and

         (b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 12.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.

SECTION 12.05.  STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

         Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
<PAGE>   97
                                                                              97

         (a) a statement that the Person making such certificate or opinion has
read such covenant or condition;

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

         (c) a statement that, in the opinion of such Person, he or she has or
they have made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or condition
has been satisfied; and

         (d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.

SECTION 12.06.  RULES BY TRUSTEE AND AGENTS.

         The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.

SECTION 12.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
SHAREHOLDERS.

         No past, present or future director, officer, employee, incorporator or
shareholder of the Company or any Guarantor, as such, shall have any liability
for any obligations of the Company or such Guarantor under the Securities, the
Subsidiary Guarantees, this Indenture or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the Securities.

SECTION 12.08.  GOVERNING LAW.

THIS INDENTURE, THE SECURITIES AND THE GUARANTEES SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 12.09.  CURRENCY INDEMNITY.

         U.S. dollars are the sole currency of account and payment for all sums
payable by the Company and the Guarantors under or in connection with the
Securities, including damages. Any account received or recovered in a currency
other than dollars (whether as a result of, or the enforcement of, a judgment or
order of a court of any jurisdiction, in the liquidation, dissolution or other
winding-up of the affairs of the Company or the Guarantors or otherwise) by any
Holder of a Note in respect of any sum expressed to be due to it from the
Company or the Guarantors shall only constitute a discharge to the Company and
the Guarantors to the extent of the dollar amount which the recipient is able to
purchase with the amount so received or recovered in that other currency on the
date of that receipt or recovery (or, if it is not practicable
<PAGE>   98
                                                                              98

to make that purchase on that date, on the first date on which it is practicable
to do so). If that dollar amount is less than the dollar amount expressed to be
due to the recipient under any Note, the Company and the Guarantors shall
indemnify it against any loss sustained by it as a result. In any event, the
Company and the Guarantors shall indemnify the recipient against the cost of
making any such purchase. For the purposes of this paragraph, it will be
sufficient for the Holder of a Note to certify in a satisfactory manner
(indicating the sources of information used) that it would have suffered a loss
had an actual purchase of dollars been made with the amount so received in that
other currency on the date of receipt or recovery (or, if a purchase of dollars
on such date had not been practicable, on the first date on which it would have
been practicable, it being required that the need for a change of date be
certified in the manner mentioned above). These indemnities constitute a
separate and independent obligation from the Company's and the Guarantors' other
obligations, shall give rise to a separate and independent cause of action,
shall apply irrespective of any indulgence granted by any Holder of a Note and
shall constitute in full force and effect despite any other judgment, order,
claim or proof for a liquidated amount in respect of any sum due under any Note.

SECTION 12.10.  CONSENT TO JURISDICTION AND SERVICE.

         To the fullest extent permitted by applicable law, the Company and each
of the Guarantors hereby irrevocably submit to the jurisdiction of any Federal
or State court located in the Borough of Manhattan in The City of New York, New
York in any suit, action or proceeding based on or arising out of or relating to
this Agreement or any Securities or Exchange Securities, and irrevocably agree
that all claims in respect of such suit or proceeding may be determined in any
such court. The Company and each of the Guarantors irrevocably waive, to the
fullest extent permitted by law, any objection which they may have to the laying
of the venue of any such suit, action or proceeding brought in such a court and
any claim that any suit, action or proceeding brought in such a court has been
brought in an inconvenient forum. The Company and each of the Guarantors agree
that final judgment in any such suit, action or proceeding brought in such a
court shall be conclusive and binding upon the Company and each such Guarantor
and may be enforced in the courts of Bermuda (or any other courts to the
jurisdiction of which the Company or such Guarantor is subject) by a suit upon
such judgment, provided that service of process is effected upon the Company or
such Guarantor in the manner specified herein or as otherwise permitted by law.
The Company and each of the Guarantors hereby irrevocably designate and appoint
CT Corporation System, 1633 Broadway - 23rd Floor, New York, New York (the
"Process Agent"), as the authorized agent of the Company and each such Guarantor
upon whom process may be served in any such suit or proceeding, it being
understood that the designation and appointment of the Process Agent as such
authorized agent shall become effective immediately without any further action
on the part of the Company or any Guarantor. The Company and each of the
Guarantors hereby represent to each Initial Purchaser that they have notified
the Process Agent of such designation and appointment and that the Process Agent
has accepted the same in writing. The Company and each of the Guarantors hereby
irrevocably authorize and direct the Process Agent to accept such service. The
Company and each of the Guarantors further agree that service of process upon
the Process Agent and written notice of said service to the Company mailed by
prepaid registered first class mail or delivered to the Process Agent at its
principal office, shall be deemed in every respect effective service of process
upon the Company and each Guarantor in
<PAGE>   99
                                                                              99

any such suit or proceeding. Nothing herein shall affect the right of any
Initial Purchaser or any person controlling any Initial Purchaser to serve
process in any other matter permitted by law. The Company and each of the
Guarantors further agree to take any and all action, including the execution and
filing of any and all such documents and instruments as may be necessary to
continue such designation and appointment of the Process Agent in full force and
effect so long as the Company or any Guarantor has any outstanding obligations
under this Agreement, the Securities, the Exchange Securities or this Indenture.
To the extent that the Company or any Guarantor has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of note, attachment prior to judgment, attachment in aid of
execution, executor or otherwise) with respect to itself or its property, the
Company and each such Guarantor hereby irrevocably waive such immunity in
respect of their respective obligations under this Agreement, to the extent
permitted by law.

SECTION 12.11.  NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

         This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.

SECTION 12.12.  SUCCESSORS.

         All agreements of the Company in this Indenture and the Securities
shall bind its successors. All agreements of the Trustee in this Indenture shall
bind its successors.

SECTION 12.13.  SEVERABILITY.

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

SECTION 12.14.  COUNTERPART ORIGINALS.

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

SECTION 12.15.  TABLE OF CONTENTS, HEADINGS, ETC.

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

                       [Indenture signature page follows]
<PAGE>   100
                                                                             100

                           [Indenture signature page]

Dated as of ___________, 2000

                         ASIA GLOBAL CROSSING LTD.

                         BY:

                              NAME:
                              TITLE:

                         UNITED STATES TRUST COMPANY OF NEW YORK, AS TRUSTEE

                         BY:

                              NAME:
                              TITLE:
<PAGE>   101
                                   EXHIBIT A-1

                                 (Face of Note)

       [INSERT THE GLOBAL SECURITY LEGENDS, IF APPLICABLE PURSUANT TO THE
                          PROVISIONS OF THE INDENTURE]
       [INSERT THE PRIVATE PLACEMENT LEGEND, IF APPLICABLE PURSUANT TO THE
                          PROVISIONS OF THE INDENTURE]
                     [INSERT ORIGINAL ISSUE DISCOUNT LEGEND]

                                                                           CUSIP

                  __% [SERIES A] [SERIES B] SECURITIES DUE ____
No.                                                                  $

                            ASIA GLOBAL CROSSING LTD.

promises to pay to Cede & Co.

or registered assigns, the principal sum of

Dollars on _______, ____.

                 Interest Payment Dates: _________ and ________

                    Record Dates: ___________ and __________.

                            ASIA GLOBAL CROSSING LTD.

                                  By:

                                            Name:
                                            Title:

                                  By:

                                            Name:
                                            Title:

This is one of the

Securities referred to in the

within-mentioned Indenture:

UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee

By:                               Dated:  _________, ____
Name:
Title:

<PAGE>   102
                                 (Back of Note)

__% [Series A] [Series B] Securities due ____

         Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated. For the purposes
of this Note, the term "Securities" shall refer only to the Company's __%
Securities due ____.

         1.   INTEREST.

         Asia Global Crossing Ltd., a Bermuda company (the "Company"), promises
to pay interest on the principal amount of this Note at __% per annum from
_______, ____ until maturity [and shall pay the Special Interest payable
pursuant to Section __ of the Registration Rights Agreement referred to below].
The Company shall pay interest and Special Interest semi-annually on _______ and
_______ of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an "Interest Payment Date"). Interest on the
Securities shall accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of issuance; provided that
if there is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be _________, ____. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is
1.0% per annum in excess of the rate then in effect; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Special Interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.

         2.   METHOD OF PAYMENT.

         The Company shall pay interest on the Securities (except defaulted
interest) and Special Interest to the Persons who are registered Holders of
Securities at the close of business on the _________ or ________ next preceding
the Interest Payment Date, even if such Securities are canceled after such
record date and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture with respect to defaulted interest. The Securities
shall be payable as to principal, premium and Special Interest, if any, and
interest at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest and Special Interest may be made by check mailed to
the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of immediately available funds shall be
required with respect to principal of and interest, premium and Special Interest
on, all Global Securities and all other Securities the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.

         3.   PAYING AGENT AND REGISTRAR.
<PAGE>   103
         Initially, United States Trust Company of New York, the Trustee under
the Indenture, shall act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to any Holder. The Company or any
of its Restricted Subsidiaries may act in any such capacity.

         4.   INDENTURE.

         The Company issued the Securities under an Indenture dated as of
October __, 2000 ("Indenture") among the Company, the Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"). The
Securities are subject to all such terms, and Holders are referred to the
Indenture and the TIA for a statement of such terms. To the extent any provision
of this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling.

         5.   OPTIONAL REDEMPTION.

         (a) Except as set forth in subparagraph (b) below and in Section 6
hereof, the Securities shall not be redeemable at the Company's option at any
time.

         (b) At any time prior to their maturity, the Securities may be redeemed
at the option of the Company, in whole but not in part, upon the occurrence of a
Change of Control, upon not less than 30 nor more than 60 days' prior notice
(but in no event may any such redemption occur more than 90 days after the
occurrence of such Change of Control) mailed by first-class mail to each
Holder's registered address, at a redemption price equal to 100% of the
principal amount thereof plus the Applicable Premium as of, and accrued and
unpaid interest, if any, to, the date of redemption.

         (c) Any redemption pursuant to this Section 5 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 of the Indenture.

         6.   OPTIONAL TAX REDEMPTION.

         The Securities shall be subject to redemption at the option of the
Company or a successor corporation at any time, in whole but not in part, upon
not less than 30 nor more than 60 days' notice, at a redemption price equal to
the principal amount thereof, plus accrued and unpaid interest thereon to the
redemption date if, as a result of any change in or amendment to the laws or any
regulations or ruling promulgated thereunder of (x) Bermuda or any political
subdivision or governmental authority thereof or therein having the power to
tax, (y) any jurisdiction, other than the United States, from or through which
payment on the Securities is made by the Company or a successor corporation, or
its paying agent in its capacity as such or any political subdivision or
governmental authority thereof or therein having the power to tax or (z) any
other jurisdiction, other than the United States, in which the Company or a
successor corporation is organized, or any political subdivision or governmental
authority thereof or therein having the power to tax, or any change in the
official application or interpretation of such laws,
<PAGE>   104
regulations or rulings, or any change in the official application or
interpretation of, or any execution of or amendment to, any treaty or treaties
affecting taxation to which such jurisdiction (or such political subdivision or
taxing authority) is a party (a "Change in Tax Law"), which becomes effective on
or after ____________, ____, the Company or a successor corporation is or would
be required on the next succeeding interest payment date to pay Additional
Amounts with respect to the Securities (as described under Section 7 hereof),
and the payment of such Additional Amounts cannot be avoided by the use of any
reasonable measures available to the Company or a successor corporation.

         In addition, the Securities shall be subject to redemption at the
option of the Company at any time, in whole but not in part, upon not less than
30 nor more than 60 days' notice, at a redemption price equal to the principal
amount thereof, plus accrued and unpaid interest thereon to the redemption date,
if the Person formed by a consolidation or amalgamation of the Company or into
which the Company is merged or to which the Company conveys, transfers or leases
its properties and assets substantially as an entirety is required, as a
consequence of such consolidation, amalgamation, merger, conveyance, transfer or
lease and as a consequence of a Change in Tax Law occurring after the date of
such consolidation, amalgamation, merger, conveyance, transfer or lease, to pay
Additional Amounts in respect of any tax, assessment or governmental charge
imposed on any Holder of Securities.

         7.   PAYMENT OF ADDITIONAL AMOUNTS.

         If any deduction or withholding for any present or future taxes,
assessments or other governmental charges of (x) Bermuda or any political
subdivision or governmental authority thereof or therein having power to tax,
(y) any jurisdiction, other than the United States, from or through which
payment on the Securities is made by the Company or a successor corporation, or
its paying agent in its capacity as such or any political subdivision or
governmental authority thereof or therein having the power to tax or (z) any
other jurisdiction, other than the United States, in which the Company or a
successor corporation is organized, or any political subdivision or governmental
authority thereof or therein having the power to tax shall at any time be
required by such jurisdiction (or any such political subdivision or taxing
authority) in respect of any amounts to be paid by the Company or a successor
corporation under the Securities, the Company or a successor corporation shall
pay to each Holder of Securities as additional interest, such additional amounts
("Additional Amounts") as may be necessary in order that the net amounts paid to
such holder of such Securities who, with respect to any such tax, assessment or
other governmental charge, is not resident in, or a citizen of, such
jurisdiction, after such deduction or withholding, shall not be less than the
amount specified in such Securities to which such Holder is entitled; provided,
however, that the Company or a successor corporation shall not be required to
make any payment of Additional Amounts for or on account of:

         (a) Any tax, assessment or other governmental charge that would not
have been imposed but for (i) the existence of any present or former connection
between such Holder (or between a fiduciary, settlor, beneficiary, member or
shareholder of, or possessor of a power over, such Holder, if such Holder is an
estate, trust, partnership, limited liability company or corporation) and the
taxing jurisdiction or any political subdivision or territory or possession
thereof or area subject to its jurisdiction, including, without limitation, such
Holder (or such fiduciary, settlor, beneficiary, member, shareholder or
possessor) being or having been a citizen
<PAGE>   105
or resident thereof or being or having been present or engaged in a trade or
business therein or having or having had a permanent establishment therein, (ii)
the presentation of a Note (where presentation is required) for payment on a
date more than 30 days after (x) the date on which such payment became due and
payable or (y) the date on which payment thereof is duly provided for, whichever
occurs later, or (iii) the presentation of a Note for payment in Bermuda or any
political subdivision thereof or therein, unless such Note could not have been
presented for payment elsewhere;

         (b) Any estate, inheritance, gift, sales, transfer, personal property
or similar tax, assessment or other governmental charge;

         (c) Any tax, assessment or other governmental charge that is payable
otherwise than by withholding from payment of principal of, premium, if any, or
any interest on the Securities;

         (d) Any tax, assessment or other governmental charge that is imposed or
withheld by reason of the failure by the Holder or the beneficial owner of the
Note to comply with a request of the Company addressed to the Holder (i) to
provide information, documents or other evidence concerning the nationality,
residence or identity of the Holder or such beneficial owner or (ii) to make and
deliver any declaration or other similar claim (other than a claim for refund of
a tax, assessment or other governmental charge withheld by the Company) or
satisfy any information or reporting requirements, which, in the case of (i) or
(ii), is required or imposed by a statute, treaty, regulation or administrative
practice of the taxing jurisdiction as a precondition to exemption from all or
part of such tax, assessment or other governmental charge; or

         (e) Any combination of items (a), (b), (c) and (d) above;

         nor shall Additional Amounts be paid with respect to any payment of the
principal of, or any premium or interest on, any Note to any Holder who is a
fiduciary or partnership or limited liability company or other than the sole
beneficial owner of such payment to the extent such payment would be required by
the laws of (x) Bermuda or any political subdivision or governmental authority
thereof or therein having the power to tax, (y) any jurisdiction, other than the
United States, from or through which payment on the Securities is made by the
Company or a successor corporation, or its paying agent in its capacity as such
or any political subdivision or governmental authority thereof or therein having
the power to tax or (z) any other jurisdiction, other than the United States, in
which the Company or a successor corporation is organized, or any political
subdivision or governmental authority thereof or therein having the power to tax
to be included in the income for tax purposes of a beneficiary or settlor with
respect to such fiduciary or a member of such partnership, limited liability
company or beneficial owner who would not have been entitled to such Additional
Amounts had it been the Holder of such Note.

         The Company shall provide the Trustee with the official acknowledgment
of the relevant taxing authority (or, if such acknowledgment is not available, a
certified copy thereof) evidencing the payment of the withholding taxes, if any,
by the Company. Copies of such documentation shall be made available to the
Holders of the Securities or the Paying Agent, as applicable, upon request
therefor.

         All references in the Indenture to principal of, premium, if any, and
interest on the
<PAGE>   106
Securities shall include any Additional Amounts payable by the Company in
respect of such principal, such premium, if any, and such interest.

         8.   MANDATORY REDEMPTION.

         Except as set forth in Section 9 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Securities.

         9.   REPURCHASE AT OPTION OF HOLDER.

         (a)  Upon the occurrence of a Change of Control, the Company shall make
an offer (a "Change of Control Offer") to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of each Holder's Securities at a
purchase price equal to 101% of the aggregate principal amount thereof, plus
accrued and unpaid interest and Special Interest thereon, if any, to the date of
repurchase (the "Change of Control Payment"); provided, however, that the
Company shall not be obligated to repurchase Securities pursuant to this
subparagraph in the event that it has exercised its rights to redeem all of the
Securities as described in Section 5(c) hereof. Within 30 days following any
Change of Control, the Company shall mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture.

         (b)  The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, consummate any Asset Sale unless, (i)
the Company (or such Restricted Subsidiary, as the case may be) receives
consideration at the time of such Asset Sale at least equal to the fair market
value (as determined in good faith by the Board of Directors (including as to
the value of all noncash consideration) and set forth in an Officer's
Certificate delivered to the Trustee) of the assets or Equity Interests issued
or sold or otherwise disposed of and (ii) at least 75% of the consideration
therefor is in the form of cash and/or Cash Equivalents, and (iii) the Net
Proceeds received by the Company (or such Restricted Subsidiary, as the case may
be) from such Asset Sale are applied within 360 days following the receipt of
such Net Proceeds (a) to repay, redeem or repurchase outstanding pari passu
Indebtedness of the Company or Indebtedness of any Restricted Subsidiary;
provided that in the event that such Restricted Subsidiary is a Guarantor, the
Indebtedness to be redeemed or repurchased ranks at least pari passu to the
Guarantee given by such Restricted Subsidiary (b) to reinvest, or enter into a
legally binding agreement to reinvest, such Net Proceeds (or any portion
thereof) in assets that are used or useful in a Permitted Business or in the
Capital Stock of a Person engaged in a Permitted Business that is or immediately
thereafter becomes a Restricted Subsidiary or (c) in any combination permitted
by clauses (a) and (b). Pending the final application of any such Net Proceeds,
the Company or such Restricted Subsidiary may invest such Net Proceeds in Cash
Equivalents. The balance of such Net Proceeds, after the application of such Net
Proceeds as described in the immediately preceding clauses (a) and (b), shall
constitute "Excess Proceeds."

         (c)  When the aggregate amount of Excess Proceeds equals or exceeds
$15.0 million (taking into account income earned on such Excess Proceeds), the
Company shall be required to and, at the election of the Company, at an earlier
time, the Company, may make an offer to all Holders of Securities and pari passu
Indebtedness (an "Asset Sale Offer") to
<PAGE>   107
purchase the maximum principal amount of Securities and pari passu Indebtedness
that may be purchased out of the Excess Proceeds, at a purchase price in cash in
an amount equal to 100% of the principal amount thereof, plus accrued and unpaid
interest thereon to the date of purchase, in accordance with the procedures set
forth in Article 3 of the Indenture and the agreements governing such pari passu
Indebtedness. To the extent that any Excess Proceeds remain after consummation
of an Asset Sale Offer, the Company may use such Excess Proceeds for any purpose
not otherwise prohibited by the Indenture. If the aggregate principal amount of
Securities and pari passu Indebtedness tendered into such Asset Sale Offer by
Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select
the Securities and pari passu Indebtedness to be purchased on a pro rata basis.
Upon completion of such Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero for purposes of the first sentence of this paragraph.

         10.  NOTICE OF REDEMPTION.

         Notice of redemption shall be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Securities are to be
redeemed at its registered address. Securities in denominations larger than
$1,000 may be redeemed in part but only in whole multiples of $1,000, unless all
of the Securities held by a Holder are to be redeemed. On and after the
redemption date interest shall cease to accrue on Securities or portions thereof
called for redemption.

         11.  DENOMINATIONS, TRANSFER, EXCHANGE.

         The Securities are in registered form without coupons in denominations
of $1,000 and integral multiples of $1,000. The transfer of Securities may be
registered and Securities may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Securities for a period of 15 days before a selection of
Securities to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.

         12.  PERSONS DEEMED OWNERS.

         The registered Holder of a Note may be treated as its owner for all
purposes under the Indenture.

         13.  AMENDMENT, SUPPLEMENT AND WAIVER.

         Subject to certain exceptions, the Indenture, the Securities or any
Guarantee may be amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the then outstanding Securities voting
as a single class, and any existing default or compliance with any provision of
the Indenture, the Securities or any Guarantee may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Securities
voting as a single class. Without the consent of any Holder of a Note, the
Indenture,
<PAGE>   108
the Securities or any Guarantee may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Securities in
addition to or in place of certificated Securities, to provide for the
assumption of the Company's or any Guarantor's obligations to Holders of the
Securities in case of a merger or consolidation, to make any change that would
provide any additional rights or benefits to the Holders of the Securities or
that does not adversely affect the legal rights under the Indenture of any such
Holder, to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the TIA, or to allow any
Guarantor to execute a supplemental indenture to the Indenture.

         14.  DEFAULTS AND REMEDIES.

         (a)  Events of Default under the Indenture include: (i) the failure to
pay interest on, or Special Interest, if any, with respect to the Securities,
when the same becomes due and payable if such default continues for a period of
30 days, (ii) the failure to pay principal of any Securities when such principal
becomes due and payable, at maturity, upon redemption or otherwise; (iii)
failure by the Company or any Restricted Subsidiary to comply with Sections
4.10, 4.14 or 5.01 of the Indenture; (iv) failure by the Company or any
Restricted Subsidiary for 60 days after written notice form the Trustee or
holders of 25% or more of the aggregate principal amount of the Securities to
comply with any of its other agreements in the Indenture or this Note; (v)
default under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Company or any of its Restricted Subsidiaries (or the payment of
which is guaranteed by the Company or any of its Restricted Subsidiaries)
whether such Indebtedness or guarantee now exists, or is created after the date
of the Indenture, which default shall constitute failure to pay the principal of
such Indebtedness at Stated Maturity (after giving effect to any applicable
grace periods and any extensions thereof ) or results in the acceleration of
such Indebtedness prior to its Stated Maturity and, in each case, the principal
amount of any such other Indebtedness, together with the principal amount of any
other such Indebtedness which has not been paid or the maturity of which has
been so accelerated, aggregates $25.0 million or more; (vi) failure by the
Company or any of its Restricted Subsidiaries to pay final judgments not subject
to appeal aggregating in excess of $25.0 million (net of applicable insurance
coverage which is acknowledged in writing by the insurer), which judgments are
not paid, discharged or stayed for a period of 60 days following the entry of
the final judgment or order that causes the aggregate amount for all such final
judgments or orders outstanding and not paid, discharged or stayed to exceed
$25.0 million; (vii) except as permitted by the Indenture, any Guarantee of the
Securities of this series by a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary
shall be held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor that is a
Significant Subsidiary or any group of Guarantor, that, taken together, would
constitute a Significant Subsidiary, or any Person acting on behalf of any
Guarantor or Guarantors, shall deny or disaffirm its obligations under its
Guarantee; and (viii) certain events of bankruptcy or insolvency with respect to
the Company or any of the Company's Restricted Subsidiaries.

         (b)  If any Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the outstanding Securities,
by written notice, to the Company, may declare all the Securities to be due and
payable. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all
<PAGE>   109
outstanding Securities shall become due and payable without further action or
notice. Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding Securities may direct the Trustee in
its exercise of any trust or power. The Trustee may withhold from Holders of the
Securities notice of any continuing Default or Event of Default (except a
Default or Event of Default relating to the payment of principal or interest) if
it determines that withholding notice is in their interest. The Holders of a
majority in principal amount of the then outstanding Securities by notice to the
Trustee may on behalf of the Holders of all of the Securities waive any existing
Default or Event of Default and its consequences under the Indenture, except a
continuing Default or Event of Default in the payment of interest on, or
principal of, the Securities. The Company shall deliver to the Trustee annually
a statement regarding compliance with the Indenture, and the Company, upon
becoming aware of any Default or Event of Default, deliver to the Trustee a
statement specifying such Default or Event of Default.

         15.  ADDITIONAL RESTRICTED SUBSIDIARY GUARANTEES.

         If any Restricted Subsidiary guarantees any Debt Securities issued by
the Company after ___________, then such Restricted Subsidiary shall become a
Guarantor and execute a supplemental indenture and deliver an Opinion of
Counsel, in accordance with the terms of the Indenture.

         16.  TRUSTEE DEALINGS WITH COMPANY.

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

         17.  NO RECOURSE AGAINST OTHERS.

         A director, officer, employee, incorporator or shareholder, of the
Company or any Guarantor, as such, shall not have any liability for any
obligations of the Company or any Guarantor under the Securities, any Guarantee
or the Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.

         18.  AUTHENTICATION.

         This Note shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent.

         19.  ABBREVIATIONS.

         Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entirety), JT TEN (= joint tenants with right of survivorship and not as tenants
in common), CUST (= Custodian), and U/G/M/A (=
<PAGE>   110
Uniform Gifts to Minors Act).

         20.  ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL SECURITIES AND
RESTRICTED DEFINITIVE SECURITIES.

         In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Securities shall have all the rights set forth in the
Registration Rights Agreement.

         21.  CUSIP NUMBERS.

         Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Securities or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

         The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:

         Asia Global Crossing Ltd.
         Wessex House
         45 Reid Street
         Hamilton HM 12, Bermuda
         Attention:  Secretary of the Company

                                 ASSIGNMENT FORM

To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to

--------------------------------------------------------------------------------
                  (Insert assignee's soc. sec. or tax I.D. no.)

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

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

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

--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)

and irrevocably appoint

to transfer this Note on the books of the Company. The agent may substitute
another to act for him.

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

Date:
<PAGE>   111
                                       Your Signature:
                                       (Sign exactly as your name appears on the
                                       face of this Note)

                                       Tax Identification No:

                                       SIGNATURE GUARANTEE:

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

                                             Signatures must be guaranteed by an
                                             "eligible guarantor institution"
                                             meeting the requirements of the
                                             Registrar, which requirements
                                             include membership or participation
                                             in the Security Transfer Agent
                                             Medallion Program ("STAMP") or such
                                             other "signature guarantee program"
                                             as may be determined by the
                                             Registrar in addition to, or in
                                             substitution for, STAMP, all in
                                             accordance with the Securities
                                             Exchange Act of 1934, as amended.
<PAGE>   112
                       OPTION OF HOLDER TO ELECT PURCHASE

         If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:

         Section 4.10        Section 4.15

         If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: $________

Date:

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

                                       Tax Identification No:

                                       SIGNATURE GUARANTEE:

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

                                             Signatures must be guaranteed by an
                                             "eligible guarantor institution"
                                             meeting the requirements of the
                                             Registrar, which requirements
                                             include membership or participation
                                             in the Security Transfer Agent
                                             Medallion Program ("STAMP") or such
                                             other "signature guarantee program"
                                             as may be determined by the
                                             Registrar in addition to, or in
                                             substitution for, STAMP, all in
                                             accordance with the Securities
                                             Exchange Act of 1934, as amended.
<PAGE>   113
           SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL SECURITY(1)

         The following exchanges of a part of this Global Security for an
interest in another Global Security or for a Definitive Note, or exchanges of a
part of another Global Security or Definitive Note for an interest in this
Global Security, have been made:

<TABLE>
<CAPTION>
                                                               Principal Amount
                        Amount of             Amount of         of this Global      Signature of
                         decrease              increase             Security          authorized
                       in Principal          in Principal       following such       officer of
                      Amount of this        Amount of this         decrease          Trustee or
Date of Exchange     Global Security        Global Security      (or increase)      Note Custodian
----------------     ---------------        ---------------      -------------      --------------
<S>                  <C>                    <C>                <C>                  <C>

</TABLE>

--------------
(1) This should be included only if the Note is issued in global form.
<PAGE>   114
                                   EXHIBIT A-2

                (Face of Regulation S Temporary Global Security)

         UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR Securities IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC") TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

         THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF
THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL SECURITY
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.

         THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF
THE ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT
WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING
THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO
LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE
BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE
<PAGE>   115
REVERSE OF THIS SECURITY), (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES
ACT, (4) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (5) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A.

         THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL SECURITY,
AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
Securities, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE
HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL SECURITY
SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.

         FOR THE PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL
ISSUE DISCOUNT; FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS SECURITY, THE ISSUE
PRICE IS $[______], THE AMOUNT OF ORIGINAL ISSUE DISCOUNT IS $[______], THE
ISSUE DATE IS _______, 2000, AND THE YIELD TO MATURITY ON THE ISSUE DATE IS
[_______]% PER ANNUM.
<PAGE>   116
                                                                           CUSIP

                 [___]% [SERIES A] [SERIES B] SECURITIES DUE ___

No.                                                                  $

                            ASIA GLOBAL CROSSING LTD.

promises to pay to Cede & Co.

or registered assigns, the principal sum of

Dollars on ______.

                  Interest Payment Dates: _______ and _______.

                    Record Dates: ________ and July _______.

                            ASIA GLOBAL CROSSING LTD.

                             By:
                                     Name:
                                     Title:

                             By:
                                     Name:
                                     Title:

This is one of the

Securities referred to in the

within-mentioned Indenture:

UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee

By:                                  Dated: ______
Name:
Title:
<PAGE>   117
                (Back of Regulation S Temporary Global Security)

_____% [Series A] [Series B] Securities due ____

Capitalized terms used herein shall have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated. For the purposes of this
Note, the term "Securities" shall refer only to the Company's [____]% Securities
due ____.

         1.   INTEREST.

         Global Crossing Holdings Ltd., a Bermuda company (the "Company"),
promises to pay interest on the principal amount of this Note at __% per annum
from _______, until maturity [and shall pay the Special Interest payable
pursuant to Section __ of the Registration Rights Agreement referred to below].
The Company shall pay interest and Special Interest semi-annually on __________
and _______ of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an "Interest Payment Date"). Interest on the
Securities shall accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of issuance; provided that
if there is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be ________. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is
1.0% per annum in excess of the rate then in effect; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Special Interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.

         Until this Regulation S Temporary Global Security is exchanged for one
or more Regulation S Permanent Global Securities, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Security shall in all other respects be
entitled to the same benefits as other Securities under the Indenture.

         2.   METHOD OF PAYMENT.

         The Company shall pay interest on the Securities (except defaulted
interest) and Special Interest to the Persons who are registered Holders of
Securities at the close of business on the ________ or ______ next preceding the
Interest Payment Date, even if such Securities are canceled after such record
date and on or before such Interest Payment Date, except as provided in Section
2.12 of the Indenture with respect to defaulted interest. The Securities shall
be payable as to principal, premium and Special Interest, if any, and interest
at the office or agency of the Company maintained for such purpose within or
without the City and State of New York, or, at the option of the Company,
payment of interest and Special Interest may be made by check mailed to the
Holders at their addresses set forth in the register of Holders, and
<PAGE>   118
provided that payment by wire transfer of immediately available funds shall be
required with respect to principal of and interest, premium and Special Interest
on, all Global Securities and all other Securities the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.

         3.   PAYING AGENT AND REGISTRAR.

         Initially, United States Trust Company of New York, the Trustee under
the Indenture, shall act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to any Holder. The Company or any
of its Restricted Subsidiaries may act in any such capacity.

         4.   INDENTURE.

         The Company issued the Securities under an Indenture dated as of
October __, 2000 ("Indenture") among the Company, the Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"). The
Securities are subject to all such terms, and Holders are referred to the
Indenture and the TIA for a statement of such terms. To the extent any provision
of this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling.

         5.   OPTIONAL REDEMPTION.

         (a)  Except as set forth in subparagraph (b) below and in Section 6
hereof, the Securities shall not be redeemable at the Company's option at any
time.

         (b)  At any time prior to their maturity, the Securities may be
redeemed at the option of the Company, in whole but not in part, upon the
occurrence of a Change of Control, upon not less than 30 nor more than 60 days'
prior notice (but in no event may any such redemption occur more than 90 days
after the occurrence of such Change of Control) mailed by first-class mail to
each Holder's registered address, at a redemption price equal to 100% of the
principal amount thereof plus the Applicable Premium as of, and accrued and
unpaid interest, if any, to, the date of redemption.

         (c)  Any redemption pursuant to this Section 5 shall be made pursuant
to the provisions of Sections 3.01 through 3.06 of the Indenture.

         6.   OPTIONAL TAX REDEMPTION.

         The Securities shall be subject to redemption at the option of the
Company or a successor corporation at any time, in whole but not in part, upon
not less than 30 nor more than 60 days' notice, at a redemption price equal to
the principal amount thereof, plus accrued and
<PAGE>   119
unpaid interest thereon to the redemption date if, as a result of any change in
or amendment to the laws or any regulations or ruling promulgated thereunder of
(x) Bermuda or any political subdivision or governmental authority thereof or
therein having the power to tax, (y) any jurisdiction, other than the United
States, from or through which payment on the Securities is made by the Company
or a successor corporation, or its paying agent in its capacity as such or any
political subdivision or governmental authority thereof or therein having the
power to tax or (z) any other jurisdiction, other than the United States, in
which the Company or a successor corporation is organized, or any political
subdivision or governmental authority thereof or therein having the power to
tax, or any change in the official application or interpretation of such laws,
regulations or rulings, or any change in the official application or
interpretation of, or any execution of or amendment to, any treaty or treaties
affecting taxation to which such jurisdiction (or such political subdivision or
taxing authority) is a party (a "Change in Tax Law"), which becomes effective on
or after ____________, the Company or a successor corporation is or would be
required on the next succeeding interest payment date to pay Additional Amounts
with respect to the Securities (as described under Section 7 hereof), and the
payment of such Additional Amounts cannot be avoided by the use of any
reasonable measures available to the Company or a successor corporation.

         In addition, the Securities shall be subject to redemption at the
option of the Company at any time, in whole but not in part, upon not less than
30 nor more than 60 days' notice, at a redemption price equal to the principal
amount thereof, plus accrued and unpaid interest thereon to the redemption date,
if the Person formed by a consolidation or amalgamation of the Company or into
which the Company is merged or to which the Company conveys, transfers or leases
its properties and assets substantially as an entirety is required, as a
consequence of such consolidation, amalgamation, merger, conveyance, transfer or
lease and as a consequence of a Change in Tax Law occurring after the date of
such consolidation, amalgamation, merger, conveyance, transfer or lease, to pay
Additional Amounts in respect of any tax, assessment or governmental charge
imposed on any Holder of Securities.

         7.   PAYMENT OF ADDITIONAL AMOUNTS.

         If any deduction or withholding for any present or future taxes,
assessments or other governmental charges of (x) Bermuda or any political
subdivision or governmental authority thereof or therein having power to tax,
(y) any jurisdiction, other than the United States, from or through which
payment on the Securities is made by the Company or a successor corporation, or
its paying agent in its capacity as such or any political subdivision or
governmental authority thereof or therein having the power to tax or (z) any
other jurisdiction, other than the United States, in which the Company or a
successor corporation is organized, or any political subdivision or governmental
authority thereof or therein having the power to tax shall at any time be
required by such jurisdiction (or any such political subdivision or taxing
authority) in respect of any amounts to be paid by the Company or a successor
corporation under the Securities, the Company or a successor corporation shall
pay to each Holder of Securities as additional interest, such additional amounts
("Additional Amounts") as may be necessary in order that the net amounts paid to
such holder of such Securities who, with respect to any such tax, assessment or
other governmental charge, is not resident in, or a citizen of, such
jurisdiction, after such deduction or withholding, shall not be less than the
amount specified in
<PAGE>   120
such Securities to which such Holder is entitled; provided, however, that the
Company or a successor corporation shall not be required to make any payment of
Additional Amounts for or on account of:

         (a)  Any tax, assessment or other governmental charge that would not
have been imposed but for (i) the existence of any present or former connection
between such Holder (or between a fiduciary, settlor, beneficiary, member or
shareholder of, or possessor of a power over, such Holder, if such Holder is an
estate, trust, partnership, limited liability company or corporation) and the
taxing jurisdiction or any political subdivision or territory or possession
thereof or area subject to its jurisdiction, including, without limitation, such
Holder (or such fiduciary, settlor, beneficiary, member, shareholder or
possessor) being or having been a citizen or resident thereof or being or having
been present or engaged in a trade or business therein or having or having had a
permanent establishment therein, (ii) the presentation of a Note (where
presentation is required) for payment on a date more than 30 days after (x) the
date on which such payment became due and payable or (y) the date on which
payment thereof is duly provided for, whichever occurs later, or (iii) the
presentation of a Note for payment in Bermuda or any political subdivision
thereof or therein, unless such Note could not have been presented for payment
elsewhere;

         (b)  Any estate, inheritance, gift, sales, transfer, personal property
or similar tax, assessment or other governmental charge;

         (c)  Any tax, assessment or other governmental charge that is payable
otherwise than by withholding from payment of principal of, premium, if any, or
any interest on the Securities;

         (d)  Any tax, assessment or other governmental charge that is imposed
or withheld by reason of the failure by the Holder or the beneficial owner of
the Note to comply with a request of the Company addressed to the Holder (i) to
provide information, documents or other evidence concerning the nationality,
residence or identity of the Holder or such beneficial owner or (ii) to make and
deliver any declaration or other similar claim (other than a claim for refund of
a tax, assessment or other governmental charge withheld by the Company) or
satisfy any information or reporting requirements, which, in the case of (i) or
(ii), is required or imposed by a statute, treaty, regulation or administrative
practice of the taxing jurisdiction as a precondition to exemption from all or
part of such tax, assessment or other governmental charge; or

         (e)  Any combination of items (a), (b), (c) and (d) above;

         nor shall Additional Amounts be paid with respect to any payment of the
principal of, or any premium or interest on, any Note to any Holder who is a
fiduciary or partnership or limited liability company or other than the sole
beneficial owner of such payment to the extent such payment would be required by
the laws of (x) Bermuda or any political subdivision or governmental authority
thereof or therein having the power to tax, (y) any jurisdiction, other than the
United States, from or through which payment on the Securities is made by the
Company or a successor corporation, or its paying agent in its capacity as such
or any political subdivision or governmental authority thereof or therein having
the power to tax or (z) any other jurisdiction, other than the United States, in
which the Company or a successor corporation is organized, or
<PAGE>   121
any political subdivision or governmental authority thereof or therein having
the power to tax to be included in the income for tax purposes of a beneficiary
or settlor with respect to such fiduciary or a member of such partnership,
limited liability company or beneficial owner who would not have been entitled
to such Additional Amounts had it been the Holder of such Note.

         The Company shall provide the Trustee with the official acknowledgment
of the relevant taxing authority (or, if such acknowledgment is not available, a
certified copy thereof) evidencing the payment of the withholding taxes, if any,
by the Company. Copies of such documentation shall be made available to the
Holders of the Securities or the Paying Agent, as applicable, upon request
therefor.

         All references in the Indenture to principal of, premium, if any, and
interest on the Securities shall include any Additional Amounts payable by the
Company in respect of such principal, such premium, if any, and such interest.

         8.   MANDATORY REDEMPTION.

         Except as set forth in Section 9 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Securities.

         9.   REPURCHASE AT OPTION OF HOLDER.

         (a)  Upon the occurrence of a Change of Control, the Company shall make
an offer (a "Change of Control Offer") to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of each Holder's Securities at a
purchase price equal to 101% of the aggregate principal amount thereof, plus
accrued and unpaid interest and Special Interest thereon, if any, to the date of
repurchase (the "Change of Control Payment"); provided, however, that the
Company shall not be obligated to repurchase Securities pursuant to this
subparagraph in the event that it has exercised its rights to redeem all of the
Securities as described in Section 5(c) hereof. Within 30 days following any
Change of Control, the Company shall mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture.

         (b)  The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, consummate any Asset Sale unless, (i)
the Company (or such Restricted Subsidiary, as the case may be) receives
consideration at the time of such Asset Sale at least equal to the fair market
value (as determined in good faith by the Board of Directors (including as to
the value of all noncash consideration) and set forth in an Officer's
Certificate delivered to the Trustee) of the assets or Equity Interests issued
or sold or otherwise disposed of and (ii) at least 75% of the consideration
therefor is in the form of cash and/or Cash Equivalents, and (iii) the Net
Proceeds received by the Company (or such Restricted Subsidiary, as the case may
be) from such Asset Sale are applied within 360 days following the receipt of
such Net Proceeds (a) to repay, redeem or repurchase outstanding pari passu
Indebtedness of the Company or Indebtedness of any Restricted Subsidiary;
provided that in the event that such Restricted Subsidiary is a Guarantor, the
Indebtedness to be redeemed or repurchased ranks
<PAGE>   122
at least pari passu to the Guarantee given by such Restricted Subsidiary, (b) to
reinvest, or enter into a legally binding agreement to reinvest, such Net
Proceeds (or any portion thereof) in assets that are used or useful in a
Permitted Business or in the Capital Stock of a Person engaged in a Permitted
Business that is or immediately thereafter becomes a Restricted Subsidiary or
(c) in any combination permitted by clauses (a) and (b). Pending the final
application of any such Net Proceeds, the Company or such Restricted Subsidiary
may invest such Net Proceeds in Cash Equivalents. The balance of such Net
Proceeds, after the application of such Net Proceeds as described in the
immediately preceding clauses (a) and (b), shall constitute "Excess Proceeds."

         (c)  When the aggregate amount of Excess Proceeds equals or exceeds
$15.0 million (taking into account income earned on such Excess Proceeds), the
Company shall be required to and, at the election of the Company, at an earlier
time, the Company, may make an offer to all Holders of Securities and pari passu
Indebtedness (an "Asset Sale Offer") to purchase the maximum principal amount of
Securities and pari passu Indebtedness that may be purchased out of the Excess
Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof, plus accrued and unpaid interest thereon to the date
of purchase, in accordance with the procedures set forth in Article 3 of the
Indenture and the agreements governing such pari passu Indebtedness. To the
extent that any Excess Proceeds remain after consummation of an Asset Sale
Offer, the Company may use such Excess Proceeds for any purpose not otherwise
prohibited by the Indenture. If the aggregate principal amount of Securities and
pari passu Indebtedness tendered into such Asset Sale Offer by Holders thereof
exceeds the amount of Excess Proceeds, the Trustee shall select the Securities
and pari passu Indebtedness to be purchased on a pro rata basis. Upon completion
of such Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero
for purposes of the first sentence of this paragraph.

         10.  NOTICE OF REDEMPTION.

         Notice of redemption shall be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Securities are to be
redeemed at its registered address. Securities in denominations larger than
$1,000 may be redeemed in part but only in whole multiples of $1,000, unless all
of the Securities held by a Holder are to be redeemed. On and after the
redemption date interest shall cease to accrue on Securities or portions thereof
called for redemption.

         11.  DENOMINATIONS, TRANSFER, EXCHANGE.

         The Securities are in registered form without coupons in denominations
of $1,000 and integral multiples of $1,000. The transfer of Securities may be
registered and Securities may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any
<PAGE>   123
Securities for a period of 15 days before a selection of Securities to be
redeemed or during the period between a record date and the corresponding
Interest Payment Date.

         This Regulation S Temporary Global Security is exchangeable in whole or
in part for one or more Global Securities only (i) on or after the termination
of the 40-day restricted period (as defined in Regulation S) and (ii) upon
presentation of certificates (accompanied by an Opinion of Counsel, if
applicable) required by Article 2 of the Indenture. Upon exchange of this
Regulation S Temporary Global Security for one or more Global Securities, the
Trustee shall cancel this Regulation S Temporary Global Security.

         12.  PERSONS DEEMED OWNERS.

         The registered Holder of a Note may be treated as its owner for all
purposes under the Indenture.

         13.  AMENDMENT, SUPPLEMENT AND WAIVER.

         Subject to certain exceptions, the Indenture, the Securities or any
Guarantee may be amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the then outstanding Securities voting
as a single class, and any existing default or compliance with any provision of
the Indenture, the Securities or any Guarantee may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Securities
voting as a single class. Without the consent of any Holder of a Note, the
Indenture, the Securities or any Guarantee may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated
Securities in addition to or in place of certificated Securities, to provide for
the assumption of the Company's or any Guarantor's obligations to Holders of the
Securities in case of a merger or consolidation, to make any change that would
provide any additional rights or benefits to the Holders of the Securities or
that does not adversely affect the legal rights under the Indenture of any such
Holder, to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the TIA, or to allow any
Guarantor to execute a supplemental indenture to the Indenture.

         14.  DEFAULTS AND REMEDIES.

         (a)  Events of Default under the Indenture include: (i) the failure to
pay interest on, or Special Interest, if any, with respect to the Securities,
when the same becomes due and payable if such default continues for a period of
30 days, (ii) the failure to pay principal of any Securities when such principal
becomes due and payable, at maturity, upon redemption or otherwise; (iii)
failure by the Company or any Restricted Subsidiary to comply with Sections
4.10, 4.14 or 5.01 of the Indenture; (iv) failure by the Company or any
Restricted Subsidiary for 60 days after written notice from the Trustee or
holder of 25% or more of the aggregate principal amount of the Securities to
comply with any of its other agreements in the Indenture or this Note; (v)
default under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Company or any of its Restricted Subsidiaries (or the payment of
which is guaranteed by the Company or any of its Restricted Subsidiaries)
whether such Indebtedness or guarantee
<PAGE>   124
now exists, or is created after the date of the Indenture, which default shall
constitute failure to pay the principal of such Indebtedness at Stated Maturity
(after giving effect to any applicable grace periods and any extensions thereof)
or results in the acceleration of such Indebtedness prior to its Stated Maturity
and, in each case, the principal amount of any such other Indebtedness, together
with the principal amount of any other such Indebtedness which has not been paid
or the maturity of which has been so accelerated, aggregates $25.0 million or
more; (vi) failure by the Company or any of its Restricted Subsidiaries to pay
final judgments not subject to appeal aggregating in excess of $25.0 million
(net of applicable insurance coverage which is acknowledged in writing by the
insurer), which judgments are not paid, discharged or stayed for a period of 60
days following the entry of the final judgment or order that causes the
aggregate amount for all such final judgments or orders outstanding and not
paid, discharged or stayed to exceed $25.0 million; (vii) except as permitted by
the Indenture, any Guarantee of the Securities of this series by a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken together, would
constitute a Significant Subsidiary shall be held in any judicial proceeding to
be unenforceable or invalid or shall cease for any reason to be in full force
and effect or any Guarantor that is a Significant Subsidiary or any group of
Guarantors that, take together would constitute a Significant Subsidiary, or any
Person acting on behalf of any Guarantor or Guarantors, , shall deny or
disaffirm its obligations under its Guarantee; and (viii) certain events of
bankruptcy or insolvency with respect to the Company or any of the Company's
Restricted Subsidiaries.

         (b)  If any Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the outstanding Securities,
by written notice to the Company, may declare all the Securities to be due and
payable. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all outstanding
Securities shall become due and payable without further action or notice.
Holders may not enforce the Indenture or the Securities except as provided in
the Indenture. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Securities may direct the Trustee in
its exercise of any trust or power. The Trustee may withhold from Holders of the
Securities notice of any continuing Default or Event of Default (except a
Default or Event of Default relating to the payment of principal or interest) if
it determines that withholding notice is in their interest. The Holders of a
majority in principal amount of the then outstanding Securities by notice to the
Trustee may on behalf of the Holders of all of the Securities waive any existing
Default or Event of Default and its consequences under the Indenture, except a
continuing Default or Event of Default in the payment of interest on, or
principal of, the Securities. The Company shall deliver to the Trustee annually
a statement regarding compliance with the Indenture, and the Company, upon
becoming aware of any Default or Event of Default, deliver to the Trustee a
statement specifying such Default or Event of Default.

         15.  ADDITIONAL RESTRICTED SUBSIDIARY GUARANTEES.

         If any Restricted Subsidiary guarantees any Debt Securities issued by
the Company after _________, then such Restricted Subsidiary shall become a
Guarantor and execute a supplemental indenture and deliver an Opinion of
Counsel, in accordance with the terms of the Indenture.
<PAGE>   125
         16.  TRUSTEE DEALINGS WITH COMPANY.

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

         17.  NO RECOURSE AGAINST OTHERS.

         A director, officer, employee, incorporator or shareholder, of the
Company or any Guarantor, as such, shall not have any liability for any
obligations of the Company or any Guarantor under the Securities, any Guarantee
or the Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.

         18.  AUTHENTICATION.

         This Note shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent.

         19.  ABBREVIATIONS.

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

         20.  ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL SECURITIES AND
RESTRICTED DEFINITIVE SECURITIES.

         In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Securities shall have all the rights set forth in the
Registration Rights Agreement.

         21.  CUSIP Numbers.

         Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Securities or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

         The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
<PAGE>   126
         Asia Global Crossing Ltd.
         Wessex House
         45 Reid Street
         Hamilton HM 12, Bermuda
         Attention:  Secretary of the Company
<PAGE>   127
                                 ASSIGNMENT FORM

To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to

--------------------------------------------------------------------------------
                  (Insert assignee's soc. sec. or tax I.D. no.)

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

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

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

--------------------------------------------------------------------------------
              (Print or type assignee's name, address and zip code)

and irrevocably appoint

to transfer this Note on the books of the Company. The agent may substitute
another to act for him.

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

                              Tax Identification No:

                              SIGNATURE GUARANTEE:

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

                                 Signatures must be guaranteed by an "eligible
                                 guarantor institution" meeting the requirements
                                 of the Registrar, which requirements include
                                 membership or participation in the Security
                                 Transfer Agent Medallion Program ("STAMP") or
                                 such other "signature guarantee program" as may
                                 be determined by the Registrar in addition to,
                                 or in substitution for, STAMP, all in
                                 accordance with the Securities Exchange Act of
                                 1934, as amended.
<PAGE>   128
                       OPTION OF HOLDER TO ELECT PURCHASE

              If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:

               Section 4.10         Section 4.15

              If you want to elect to have only part of the Note purchased by
the Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: $___________

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

                              Tax Identification No:

                              SIGNATURE GUARANTEE:

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

                                 Signatures must be guaranteed by an "eligible
                                 guarantor institution" meeting the requirements
                                 of the Registrar, which requirements include
                                 membership or participation in the Security
                                 Transfer Agent Medallion Program ("STAMP") or
                                 such other "signature guarantee program" as may
                                 be determined by the Registrar in addition to,
                                 or in substitution for, STAMP, all in
                                 accordance with the Securities Exchange Act of
                                 1934, as amended.
<PAGE>   129
         SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL SECURITY

              The following exchanges of a part of this Regulation S Temporary
Global Security for an interest in another Global Security, or of other
Restricted Global Securities for an interest in this Regulation S Temporary
Global Security, have been made:

<TABLE>
<CAPTION>
                                                        Principal Amount
                   Amount of           Amount of         of this Global       Signature of
                    decrease            increase            Security           authorized
                  in Principal        in Principal       following such        officer of
   Date of       Amount of this      Amount of this         decrease           Trustee or
   Exchange     Global Security     Global Security       (or increase)      Note Custodian
   --------     ---------------     ---------------       -------------      --------------
<S>             <C>                 <C>                 <C>                  <C>
</TABLE>
<PAGE>   130
                                    EXHIBIT B

                         FORM OF CERTIFICATE OF TRANSFER

Asia Global Crossing Ltd.
45 Reid Street
Hamilton HM 12, Bermuda
Attention:  Secretary of the Company

United States Trust Company of New York
114 West 47th Street - 25th Floor
New York, New York  10036
Attention:  Corporate Trust Division

              Re:  [   ]% Securities due

              Reference is hereby made to the Indenture, dated as of October __,
2000 (the "Indenture"), among Asia Global Crossing Ltd., as issuer (the
"Company"), the Guarantors and United States Trust Company of New York, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

              ______________, (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to __________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:

[CHECK ALL THAT APPLY]

1.   CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE 144A
     GLOBAL SECURITY OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is
     being effected pursuant to and in accordance with Rule 144A under the
     United States Securities Act of 1933, as amended (the "Securities Act"),
     and, accordingly, the Transferor hereby further certifies that the
     beneficial interest or Definitive Note is being transferred to a Person
     that the Transferor reasonably believed and believes is purchasing the
     beneficial interest or Definitive Note for its own account, or for one or
     more accounts with respect to which such Person exercises sole investment
     discretion, and such Person and each such account is a "qualified
     institutional buyer" within the meaning of Rule 144A in a transaction
     meeting the requirements of Rule 144A and such Transfer is in compliance
     with any applicable blue sky securities laws of any state of the United
     States. Upon consummation of the proposed Transfer in accordance with the
     terms of the Indenture, the transferred beneficial interest or Definitive
     Note will be subject to the restrictions on transfer enumerated in the
     Private
<PAGE>   131
     Placement Legend printed on the 144A Global Security and/or the Definitive
     Note and in the Indenture and the Securities Act.

2.   CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
     TEMPORARY REGULATION S GLOBAL SECURITY, THE REGULATION S GLOBAL SECURITY OR
     A DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being effected
     pursuant to and in accordance with Rule 903 or Rule 904 under the
     Securities Act and, accordingly, the Transferor hereby further certifies
     that (i) the Transfer is not being made to a person in the United States
     and (x) at the time the buy order was originated, the Transferee was
     outside the United States or such Transferor and any Person acting on its
     behalf reasonably believed and believes that the Transferee was outside the
     United States or (y) the transaction was executed in, on or through the
     facilities of a designated offshore securities market and neither such
     Transferor nor any Person acting on its behalf knows that the transaction
     was prearranged with a buyer in the United States, (ii) no directed selling
     efforts have been made in contravention of the requirements of Rule 903(b)
     or Rule 904(b) of Regulation S under the Securities Act, (iii) the
     transaction is not part of a plan or scheme to evade the registration
     requirements of the Securities Act and (iv) if the proposed transfer is
     being made prior to the expiration of the Restricted Period, the transfer
     is not being made to a U.S. Person or for the account or benefit of a U.S.
     Person (other than an Initial Purchaser). Upon consummation of the proposed
     transfer in accordance with the terms of the Indenture, the transferred
     beneficial interest or Definitive Note will be subject to the restrictions
     on Transfer enumerated in the Private Placement Legend printed on the
     Regulation S Global Security, the Temporary Regulation S Global Security
     and/or the Definitive Note and in the Indenture and the Securities Act.

3.   CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
     INTEREST IN A DEFINITIVE NOTE PURSUANT TO ANY PROVISION OF THE SECURITIES
     ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being effected in
     compliance with the transfer restrictions applicable to beneficial
     interests in Restricted Global Securities and Restricted Definitive
     Securities and pursuant to and in accordance with the Securities Act and
     any applicable blue sky securities laws of any state of the United States,
     and accordingly the Transferor hereby further certifies that (check one):

         (a) such Transfer is being effected pursuant to and in accordance with
     Rule 144 under the Securities Act;

                                       or

         (b) such Transfer is being effected to the Company or a subsidiary
     thereof;

                                       or

         (c) such Transfer is being effected pursuant to an effective
     registration statement under the Securities Act and in compliance with the
     prospectus delivery requirements of the Securities Act.
<PAGE>   132
4.   CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN
     UNRESTRICTED GLOBAL SECURITY OR OF AN UNRESTRICTED DEFINITIVE NOTE.

         (a) CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
     being effected pursuant to and in accordance with Rule 144 under the
     Securities Act and in compliance with the transfer restrictions contained
     in the Indenture and any applicable blue sky securities laws of any state
     of the United States and (ii) the restrictions on transfer contained in the
     Indenture and the Private Placement Legend are not required in order to
     maintain compliance with the Securities Act. Upon consummation of the
     proposed Transfer in accordance with the terms of the Indenture, the
     transferred beneficial interest or Definitive Note will no longer be
     subject to the restrictions on transfer enumerated in the Private Placement
     Legend printed on the Restricted Global Securities, on Restricted
     Definitive Securities and in the Indenture.

         (b) CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is
     being effected pursuant to and in accordance with Rule 903 or Rule 904
     under the Securities Act and in compliance with the transfer restrictions
     contained in the Indenture and any applicable blue sky securities laws of
     any state of the United States and (ii) the restrictions on transfer
     contained in the Indenture and the Private Placement Legend are not
     required in order to maintain compliance with the Securities Act. Upon
     consummation of the proposed Transfer in accordance with the terms of the
     Indenture, the transferred beneficial interest or Definitive Note will no
     longer be subject to the restrictions on transfer enumerated in the Private
     Placement Legend printed on the Restricted Global Securities, on Restricted
     Definitive Securities and in the Indenture.

         (c) CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer
     is being effected pursuant to and in compliance with an exemption from the
     registration requirements of the Securities Act other than Rule 144, Rule
     903 or Rule 904 and in compliance with the transfer restrictions contained
     in the Indenture and any applicable blue sky securities laws of any State
     of the United States and (ii) the restrictions on transfer contained in the
     Indenture and the Private Placement Legend are not required in order to
     maintain compliance with the Securities Act. Upon consummation of the
     proposed Transfer in accordance with the terms of the Indenture, the
     transferred beneficial interest or Definitive Note will not be subject to
     the restrictions on transfer enumerated in the Private Placement Legend
     printed on the Restricted Global Securities or Restricted Definitive
     Securities and in the Indenture.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.

                                           [Insert Name of Transferor]

                                           By:
                                              Name:
                                              Title:

Dated:              ,
<PAGE>   133
                       ANNEX A TO CERTIFICATE OF TRANSFER

1. The Transferor owns and proposes to transfer the following:

                            [CHECK ONE OF (a) OR (b)]

     (a) a beneficial interest in the:

               (i)  144A Global Security (CUSIP________), or
              (ii)  Regulation S Global Security (CUSIP________): or

     (b) a Restricted Definitive Note.

2. After the Transfer the Transferee will hold:

                                   [CHECK ONE]

     (d)  a beneficial interest in the:

               (i)  144A Global Security (CUSIP________), or
              (ii)  Regulation S Global Security (CUSIP________), or
             (iii)  Unrestricted Global Security (CUSIP________); or

     (e) a Restricted Definitive Note; or

     (f) an Unrestricted Definitive Note, in accordance with the terms of the
         Indenture.
<PAGE>   134
                                    EXHIBIT C

                         FORM OF CERTIFICATE OF TRANSFER

Asia Global Crossing Ltd.
45 Reid Street
Hamilton HM 12, Bermuda
Attention:  Secretary of the Company

United States Trust Company of New York
114 West 47th Street - 25th Floor
New York, New York  10036
Attention:  Corporate Trust Division

         Re:  ______% Securities due

                             (CUSIP ______________)

         Reference is hereby made to the Indenture, dated as of October __, 2000
(the "Indenture"), among Asia Global Crossing Ltd., as issuer (the "Company"),
the Guarantors and [United States Trust Company of New York], as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.

         ____________, (the "Owner") owns and proposes to exchange the Note[s]
or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:

1. EXCHANGE OF RESTRICTED DEFINITIVE SECURITIES OR BENEFICIAL INTERESTS IN A
RESTRICTED GLOBAL SECURITY FOR UNRESTRICTED DEFINITIVE SECURITIES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL SECURITY.

         (a) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL SECURITY TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL SECURITY. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Security for a beneficial interest in an Unrestricted Global Security in
an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Global Securities and pursuant to and in accordance with the
United States Securities Act of 1933, as amended (the "Securities Act"), (iii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global
Security is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
<PAGE>   135
         (b) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL SECURITY TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Security for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Definitive Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.

         (c) CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL SECURITY. In connection with the Owner's
Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Security, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.

         (d) CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Securities
and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Unrestricted Definitive Note is being acquired in compliance with
any applicable blue sky securities laws of any state of the United States.

2. EXCHANGE OF RESTRICTED DEFINITIVE SECURITIES OR BENEFICIAL INTERESTS IN
RESTRICTED GLOBAL SECURITIES FOR RESTRICTED DEFINITIVE SECURITIES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL SECURITIES.

         (a) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL SECURITY TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Security for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
<PAGE>   136
         (b) CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL
INTEREST IN A RESTRICTED GLOBAL SECURITY. In connection with the Exchange of the
Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE]
144A Global Security, Regulation S Global Security, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner's own account
without transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Securities and
pursuant to and in accordance with the Securities Act, and in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Security and in the Indenture and the Securities Act.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.

                                  ___________________________________
                                  [Insert Name of Owner]

                                  By:_______________________________
                                     Name:
                                     Title:

Dated: __________
<PAGE>   137
                                    EXHIBIT D

                          FORM OF NOTATION OF GUARANTEE

         For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of October__, 2000 (the "Indenture") among
Asia Global Crossing Ltd., the Guarantors signatories thereto and United States
Trust Company of New York, as trustee (the "Trustee"), (a) the due and punctual
payment of the principal of, premium, if any, and interest on the Securities (as
defined in the Indenture), whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal and
premium, and, to the extent permitted by law, interest, and the due and punctual
performance of all other obligations of the Company to the Holders or the
Trustee all in accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Securities or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to the
Holders of Securities and to the Trustee pursuant to the Guarantee and the
Indenture are expressly set forth in Article 10 of the Indenture and reference
is hereby made to the Indenture for the precise terms of the Guarantee. Each
Holder of a Note, by accepting the same, (a) agrees to and shall be bound by
such provisions and (b) appoints the Trustee attorney-in-fact for such purpose.

                                 [GUARANTOR(S)]

                                 BY: ____________________________
                                     Name:
                                     Title:
<PAGE>   138
                                    EXHIBIT E

                         FORM OF SUPPLEMENTAL INDENTURE
                    TO BE DELIVERED BY SUBSEQUENT GUARANTORS

         SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") dated as of
____________________, among _____________________ (the "Guarantor"), a
subsidiary of Asia Global Crossing Ltd. (or its successor), a company organized
under the laws of Bermuda (the "Company"), and United States Trust Company of
New York, as trustee under the indenture referred to below (the "Trustee").

                               W I T N E S S E T H

         WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of October 20, 2000, providing
for the issuance of an aggregate principal amount at maturity of $[___________]
of [__]%Securities due ___ (the "Securities");

         WHEREAS, Section 4.22 of the Indenture provides that, under certain
circumstances, the Company is required to cause the Guarantor to execute and
deliver to the Trustee a Subsidiary Guarantee on the terms and conditions set
forth herein; and

         WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.

         NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Securities as follows:

         1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.

         2. INDENTURE PROVISION PURSUANT TO WHICH SUBSIDIARY GUARANTEE IS GIVEN.
This Supplemental Indenture is being executed and delivered pursuant to Section
4.22 of the Indenture.

         3. AGREEMENTS TO SUBSIDIARY GUARANTEE. The Guarantor hereby agrees as
follows:

         (a) The Guarantor, jointly and severally with all other Guarantors, if
any, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
regardless of the validity and enforceability of the Indenture, the Securities
and the obligations of the Company under the Indenture and the

<PAGE>   139
Securities, that:

                  (i) the principal of, premium and Special Interest, if any,
and interest on the Securities shall be promptly paid in full when due, whether
at maturity, by acceleration, redemption or otherwise, and interest on the
overdue principal of, premium, interest and Special Interest, if any, on the
Securities, to the extent lawful, and all other obligations of the Company to
the Holders or the Trustee thereunder shall be promptly paid in full, all in
accordance with the terms thereof; and

                  (ii) in case of any extension of time for payment or renewal
of any Securities or any of such other obligations, that the same shall be
promptly paid in full when due in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.

         Notwithstanding the foregoing, in the event that this Subsidiary
Guarantee would constitute or result in a violation of any applicable fraudulent
conveyance or similar law of any relevant jurisdiction, the liability of the
Guarantor under this Supplemental Indenture and its Subsidiary Guarantee shall
be limited to such amount as will not, after giving effect thereto, and to all
other liabilities of the Guarantor, result in such amount constituting a
fraudulent transfer or conveyance.

         4. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEES

         (a) To evidence its Subsidiary Guarantee set forth in this Supplemental
Indenture, the Guarantor hereby agrees that a notation of such Subsidiary
Guarantee substantially in the form of Annex A hereto shall be endorsed by an
officer of such Guarantor on each Note authenticated and delivered by the
Trustee after the date hereof.

         (b) Notwithstanding the foregoing, the Guarantor hereby agrees that its
Subsidiary Guarantee set forth herein shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.

         (c) If an officer whose signature is on this Supplemental Indenture or
on the Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.

         (d) The delivery of the Note by the Trustee, after the authentication
thereof under the Indenture, shall constitute due delivery of the Subsidiary
Guarantee set forth in this Supplemental Indenture on behalf of the Guarantor.

         (e) The Guarantor hereby agrees that its obligations hereunder shall be
unconditional, regardless of the validity, regularity or enforceability of the
Securities or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
hereof or thereof, the recovery of any judgment
<PAGE>   140
against the Company, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor.

         (f) The Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest, notice and all demands whatsoever and covenants that its Subsidiary
Guarantee made pursuant to this Supplemental Indenture will not be discharged
except by complete performance of the obligations contained in the Securities
and the Indenture or pursuant to Section 5(b) of this Supplemental Indenture.

         (g) If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Supplemental Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then, and in every such
case, subject to any determination in such proceeding, the Guarantor, the
Trustee and the Holders shall be restored severally and respectively to their
former positions hereof and thereafter all rights and remedies of the Guarantor,
the Trustee and the Holders shall continue as though no such proceeding had been
instituted.

         (h) The Guarantor hereby waives and will not in any manner whatsoever
claim or take the benefit or advantage of, any rights of reimbursement,
indemnity or subrogation or any other rights against the Company or any other
Guarantor as a result of any payment by such Guarantor under its Subsidiary
Guarantee. The Guarantor further agrees that, as between the Guarantors, on the
one hand, and the Holders and the Trustee, on the other hand:

                  (i) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Article 6 of the Indenture for the purposes of the
Subsidiary Guarantee made pursuant to this Supplemental Indenture,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby; and

                  (ii) in the event of any declaration of acceleration of such
obligations as provided in Article 6, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantor for the purpose
of the Subsidiary Guarantee made pursuant to this Supplemental Indenture.

         (i) The Guarantor shall have the right to seek contribution from any
other non-paying Guarantor, if any, so long as the exercise of such right does
not impair the rights of the Holders under the Subsidiary Guarantee made
pursuant to this Supplemental Indenture.

         (j) The Guarantor covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of the Indenture or this Subsidiary Guarantee; and
the Guarantor (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the
<PAGE>   141
execution of every such power as though no such law had been enacted.

         5. GUARANTOR MAY CONSOLIDATE, ETC. ON CERTAIN TERMS

         (a) Except as set forth in Articles 4 and 5 of the Indenture, nothing
contained in the Indenture, this Supplemental Indenture or in the Securities
shall prevent any consolidation or merger of the Guarantor with or into the
Company or any other Guarantor or shall prevent any transfer, sale or conveyance
of the property of the Guarantor as an entirety or substantially as an entirety,
to the Company or any other Guarantor.

         (b) Except as set forth in Article 5 of the Indenture, upon the sale or
disposition of all of the Capital Stock of the Guarantor by the Company or the
Subsidiary of the Company, or upon the consolidation or merger of the Guarantor
with or into any Person, or the sale of all or substantially all of the assets
of the Guarantor (in each case, other than to an Affiliate of the Company), such
Guarantor shall be deemed automatically and unconditionally released and
discharged from all obligations under this Subsidiary Guarantee without any
further action required on the part of the Trustee or any Holder if no Default
shall have occurred and be continuing; provided, that in the event of an Asset
Sale (including a sale of the Capital Stock of the Guarantor), the Net Cash
Proceeds therefrom are treated in accordance with Section 4.10 of the Indenture.
Except with respect to transactions set forth in the preceding sentence, the
Company and the Guarantor covenant and agree that upon any such consolidation,
merger or transfer of assets, the performance of all covenants and conditions of
this Supplemental Indenture to be performed by such Guarantor shall be expressly
assumed by supplemental indenture satisfactory in form and substance to the
Trustee, by the corporation formed by such consolidation, or into which the
Guarantor shall have merged, or by the corporation which shall have acquired
such property. Upon receipt of an Officers' Certificate of the Company or the
Guarantor, as the case may be, to the effect that the Company or such Guarantor
has complied with the first sentence of this Section 5(b), the Trustee shall
execute any documents reasonably requested by the Company or the Guarantor, at
the cost of the Company or such Guarantor, as the case may be, in order to
evidence the release of such Guarantor from its obligations under its Subsidiary
Guarantee endorsed on the Securities and under the Indenture and this
Supplemental Indenture.

         6. RELEASES UPON RELEASE OF SUBSIDIARY GUARANTEE OF GUARANTEED
INDEBTEDNESS.

         Concurrently with the release or discharge of the Guarantor's guarantee
of the payment of [DESCRIBE INDEBTEDNESS THE GUARANTEE OF WHICH GAVE RISE TO THE
DELIVERY OF THIS SUPPLEMENTAL INDENTURE] ("Guaranteed Debt") (other than a
release or discharge by or as a result of payment under such guarantee of
Guaranteed Indebtedness), the Guarantor shall be automatically and
unconditionally released and relieved of its obligations under this Supplemental
Indenture and its Subsidiary Guarantee made pursuant to Section 4 of this
Supplemental Indenture. Upon delivery by the Company to the Trustee of an
Officer's Certificate to the effect that such release or discharge has occurred,
the Trustee shall execute any documents reasonably required in order to evidence
the release of the Guarantor from its obligations under this Supplemental
Indenture and its Subsidiary Guarantee made pursuant
<PAGE>   142
hereto; provided such documents shall not affect or impair the rights of the
Trustee and Paying Agent under Section 7.07 of the Indenture.

         7. NEW YORK LAW TO GOVERN.

         The internal law of the State of New York shall govern and be used to
construe this Supplemental Indenture.

         8. COUNTERPARTS.

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

         9. EFFECT OF HEADINGS.

         The Section headings herein are for convenience only and shall not
effect the construction hereof.

                         [Signatures on following page]
<PAGE>   143
         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.

<TABLE>
<S>                                        <C>
Dated:                                     [Guarantor]

                                           By:
                                              Name:
                                              Title:

Dated:                                     as Trustee

                                           By:
                                              Name:
                                              Title:
</TABLE>
<PAGE>   144
                        ANNEX A TO SUPPLEMENTAL INDENTURE
              FORM OF NOTATION OF SUBSIDIARY GUARANTEE ON SECURITY

         For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of October__, 2000 (the "Indenture") among
Asia Global Crossing Ltd., the Guarantors signatories thereto and United States
Trust Company of New York, as trustee (the "Trustee"), (a) the due and punctual
payment of the principal of, premium, if any, and interest on the Securities (as
defined in the Indenture), whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal and
premium, and, to the extent permitted by law, interest, and the due and punctual
performance of all other obligations of the Company to the Holders or the
Trustee all in accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Securities or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to the
Holders of Securities and to the Trustee pursuant to the Subsidiary Guarantee
and the Indenture are expressly set forth in Article 10 of the Indenture and
reference is hereby made to the Indenture for the precise terms of the Note
Guarantee. Each Holder of a Note, by accepting the same, (a) agrees to and shall
be bound by such provisions and (b) appoints the Trustee attorney-in-fact of
such Holder for such purpose.

                                          [Guarantor]

                                          By:
                                             Name:

                                             Title:
<PAGE>   145
                             CROSS-REFERENCE TABLE*

<TABLE>
<CAPTION>
Trust Indenture Act Section                                    Indenture Section
<S>                                                            <C>
310(a)(1)                                                            7.10
(a)(2)                                                               7.10
(a)(3)                                                               N.A.
(a)(4)                                                               N.A.
(a)(5)                                                               7.10
(b)                                                                  7.10
(c)                                                                  N.A.
311(a)                                                               7.11
(b)                                                                  7.11
(i)(c)                                                               N.A.
312(a)                                                               2.05
(b)                                                                  12.03
(c)                                                                  12.03
313(a)                                                               7.06
(b)(2)                                                               7.07
(c)                                                                  7.06; 12.02
(d)                                                                  7.06
314(a)                                                               4.03; 12.02
(c)(1)                                                               12.04
(c)(2)                                                               12.04
(c)(3)                                                               N.A.
(e)                                                                  12.05
(f)                                                                  N.A.
315(a)                                                               7.01
(b)                                                                  7.05; 12.02
(A)(c)                                                               7.01
(d)                                                                  7.01
(e)                                                                  6.11
316(a)(last sentence)                                                2.09
(a)(1)(A)                                                            6.05
(a)(1)(B)                                                            6.04
(a)(2)                                                               N.A.
(b)                                                                  6.07
(c)                                                                  2.12
317(a)(1)                                                            6.08
(a)(2)                                                               6.09
(b)                                                                  2.04
318(a)                                                               12.01
(b)                                                                  N.A.
(c)                                                                  12.01
</TABLE>
N.A. means not applicable
* This Cross-Reference Table is not part of the Indenture.
<PAGE>   146
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                      Page
                                                                                                      ----

<S>                                                                                                   <C>
Recitals of the Company                                                                                 1

ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE                                                   1
         Section 1.01.  Definitions                                                                     1
         Section 1.02.  Other Definitions                                                              21
         Section 1.03.  Trust Indenture Act Definitions                                                22
         Section 1.04.  Rules of Construction                                                          23

ARTICLE 2. THE SECURITIES                                                                              23
         Section 2.01.  Form and Dating                                                                23
         Section 2.02.  Execution and Authentication                                                   25
         Section 2.03.  Registrar and Paying Agent                                                     26
         Section 2.04.  Paying Agent to Hold Money in Trust                                            26
         Section 2.05.  Holder Lists                                                                   26
         Section 2.06.  Transfer and Exchange                                                          27
         Section 2.07.  Replacement Securities                                                         41
         Section 2.08.  Outstanding Securities                                                         41
         Section 2.09.  Treasury Securities                                                            41
         Section 2.10.  Temporary Securities                                                           42
         Section 2.11.  Cancellation                                                                   42
         Section 2.12.  Defaulted Interest                                                             42
         Section 2.13.  CUSIP Numbers                                                                  42

ARTICLE 3.  REDEMPTION AND PREPAYMENT                                                                  43
         Section 3.01.  Notices to Trustee                                                             43
         Section 3.02.  Selection of Securities to Be Redeemed                                         43
         Section 3.03.  Notice of Redemption                                                           43
         Section 3.04.  Effect of Notice of Redemption                                                 44
         Section 3.05.  Deposit of Redemption Price                                                    44
         Section 3.06.  Securities Redeemed in Part                                                    45
         Section 3.07.  Optional Redemption                                                            45
         Section 3.08.  Optional Tax Redemption                                                        46
         Section 3.09.  Payment of Additional Amounts                                                  47
         Section 3.10.  Mandatory Redemption                                                           49
         Section 3.11.  Offer to Purchase by Application of Excess Proceeds                            49

ARTICLE 4.  COVENANTS                                                                                  51
         Section 4.01.  Payment of Securities                                                          51
         Section 4.02.  Maintenance of Office or Agency                                                51
</TABLE>
<PAGE>   147
<TABLE>
<S>                                                                                                   <C>
         Section 4.03.  Reports                                                                        52
         Section 4.04.  Compliance Certificate                                                         52
         Section 4.05.  Taxes                                                                          53
         Section 4.06.  Stay, Extension and Usury Laws                                                 53
         Section 4.07.  Restricted Payments                                                            53
         Section 4.08.  Dividend and Other Payment Restrictions Affecting Restricted
                              Subsidiaries                                                             57
         Section 4.09.  Incurrence of Indebtedness and Issuance of Preferred Stock                     58
         Section 4.10.  Asset Sales                                                                    61
         Section 4.11.  Transactions with Affiliates                                                   63
         Section 4.12.  Liens                                                                          64
         Section 4.13.  Corporate Existence                                                            64
         Section 4.14.  Offer to Repurchase Upon Change of Control                                     64
         Section 4.15.  Business Activities                                                            65
         Section 4.16.  [Reserved]                                                                     66
         Section 4.17.  [Reserved]                                                                     66
         Section 4.18.  Issuances and Sales of Equity Interests in Wholly Owned Restricted
                              Subsidiaries                                                             66
         Section 4.19.  Payments For Consent                                                           66
         Section 4.20.  Money for Payments to Be Held In Trust                                         66
         Section 4.21.  Future Guarantees                                                              68

ARTICLE 5.  SUCCESSORS                                                                                 68
         Section 5.01.  Merger, Consolidation, or Sale of Assets                                       68
         Section 5.02.  Successor Corporation Substituted                                              69

ARTICLE 6.  DEFAULTS AND REMEDIES                                                                      69
         Section 6.01.  Events of Default                                                              69
         Section 6.02.  Acceleration                                                                   71
         Section 6.03.  Other Remedies                                                                 72
         Section 6.04.  Waiver of Past Defaults                                                        72
         Section 6.05.  Control by Majority                                                            72
         Section 6.06.  Limitation on Suits                                                            73
         Section 6.07.  Rights of Holders of Securities to Receive Payment                             73
         Section 6.08.  Collection Suit by Trustee                                                     73
         Section 6.09.  Trustee May File Proofs of Claim                                               74
         Section 6.10.  Priorities                                                                     74
         Section 6.11.  Undertaking for Costs                                                          75

ARTICLE 7.  TRUSTEE                                                                                    75
         Section 7.01.  Duties of Trustee                                                              75
         Section 7.02.  Rights of Trustee                                                              76
         Section 7.03.  Individual Rights of Trustee                                                   77
</TABLE>
<PAGE>   148
<TABLE>
<S>                                                                                                   <C>
         Section 7.04.  Trustee's Disclaimer                                                           77
         Section 7.05.  Notice of Defaults                                                             77
         Section 7.06.  Reports by Trustee to Holders of the Securities                                78
         Section 7.07.  Compensation and Indemnity                                                     78
         Section 7.08.  Replacement of Trustee                                                         79
         Section 7.09.  Successor Trustee by Merger, etc                                               80
         Section 7.10.  Eligibility; Disqualification                                                  81
         Section 7.11.  Preferential Collection of Claims Against Company                              81

ARTICLE 8.  LEGAL DEFEASANCE AND COVENANT DEFEASANCE                                                   81
         Section 8.01.  Option to Effect Legal Defeasance or Covenant Defeasance                       81
         Section 8.02.  Legal Defeasance and Discharge                                                 81
         Section 8.03.  Covenant Defeasance                                                            82
         Section 8.04.  Conditions to Legal or Covenant Defeasance                                     82
         Section 8.05.  Deposited Money and Government Securities to be Held in Trust; Other
                              Miscellaneous Provisions                                                 84
         Section 8.06.  Repayment to Company                                                           84
         Section 8.07.  Reinstatement                                                                  85
         Section 8.08.  Survival                                                                       85

ARTICLE 9.  AMENDMENT, SUPPLEMENT AND WAIVER                                                           85
         Section 9.01.  Without Consent of Holders of Securities                                       85
         Section 9.02.  With Consent of Holders of Securities                                          86
         Section 9.03.  Compliance with Trust Indenture Act                                            88
         Section 9.04.  Revocation and Effect of Consents                                              88
         Section 9.05.  Notation on or Exchange of Securities                                          88
         Section 9.06.  Trustee to Sign Amendments, etc                                                88

ARTICLE 10.  GUARANTEES                                                                                89
         Section 10.01.  Guarantee                                                                     89
         Section 10.02.  Limitation on Guarantor Liability                                             90
         Section 10.03.  Execution and Delivery of Guarantee                                           91
         Section 10.04.  Guarantors May Consolidate, etc., on Certain Terms                            91
         Section 10.05.  Releases Following Sale of Assets                                             92

ARTICLE 11.  SATISFACTION AND DISCHARGE                                                                92
         Section 11.01.  Satisfaction and Discharge of Indenture                                       92
         Section 11.02.  Application of Trust Money                                                    93

ARTICLE 12.  MISCELLANEOUS                                                                             94
         Section 12.01.  Trust Indenture Act Controls                                                  94
         Section 12.02.  Notices                                                                       94
         Section 12.03.  Communication by Holders of Securities with Other Holders of Securities       95
</TABLE>
<PAGE>   149
<TABLE>
<S>                                                                                                   <C>
         Section 12.04.  Certificate and Opinion as to Conditions Precedent                            96
         Section 12.05.  Statements Required in Certificate or Opinion                                 96
         Section 12.06.  Rules by Trustee and Agents                                                   96
         Section 12.07.  No Personal Liability of Directors, Officers, Employees and Shareholders      97
         Section 12.08.  Governing Law                                                                 97
         Section 12.09.  Currency Indemnity                                                            97
         Section 12.10.  Consent to Jurisdiction and Service                                           98
         Section 12.11.  No Adverse Interpretation of Other Agreements                                 99
         Section 12.12.  Successors                                                                    99
         Section 12.13.  Severability                                                                  99
         Section 12.14.  Counterpart Originals                                                         99
         Section 12.15.  Table of Contents, Headings, etc                                              99
</TABLE><PAGE>   1
                                                                    Exhibit 10.4

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

                               EAST ASIAN CROSSING

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

                               PROJECT DEVELOPMENT

                                       AND

                              CONSTRUCTION CONTRACT

                                     BETWEEN

                        KDD SUBMARINE CABLE SYSTEMS INC.

                                       AND

                            ASIA GLOBAL CROSSING LTD.

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

                          DATED AS OF DECEMBER 17, 1999

                      -------------------------------------
<PAGE>   2
                                TABLE OF CONTENTS

                          GENERAL TERMS AND CONDITIONS

<TABLE>
<CAPTION>
Article                                                                                                        PAGE
-------                                                                                                        ----
<S>                                                                                                             <C>
1        Provision of System.................................................................................... -1-
2        Documents Forming the Entire Contract.................................................................. -2-
3        Definitions............................................................................................ -2-
4        Contract Price........................................................................................ -16-
5        Terms of Payment by Purchaser......................................................................... -20-
6        Contract Variations................................................................................... -23-
6A       Optional Upgrades..................................................................................... -25-
7        Responsibilities for Permits; Compliance with Laws; Hong Kong Cable Station........................... -29-
8        Route Survey.......................................................................................... -31-
9        Acceptance............................................................................................ -32-
10       Warranty.............................................................................................. -36-
11       Contractor Support; Use of Segment for Restoration Protection......................................... -41-
12       Purchaser's Obligations............................................................................... -42-
13       Termination for Default............................................................................... -43-
14       Termination for Convenience........................................................................... -45-
15       Suspension............................................................................................ -47-
16       Title and Risk of Loss................................................................................ -48-
17       Force Majeure......................................................................................... -48-
18       Intellectual Property................................................................................. -49-
19       Infringement.......................................................................................... -55-
20       Safeguarding of Information and Technology............................................................ -56-
21       Export Control........................................................................................ -57-
22       Liquidated Damages.................................................................................... -57-
23       Limitation of Liability/Indemnification............................................................... -58-
24       Counterparts.......................................................................................... -60-
25       Design and Performance Responsibility; Subcontractors................................................. -60-
26       Product Changes....................................................................................... -61-
27       Risk and Insurance.................................................................................... -62-
28       Plant and Work Rules.................................................................................. -65-
29       Right of Access and Review............................................................................ -65-
30       Quality Assurance; First Application.................................................................. -66-
31       Documentation......................................................................................... -67-
32       Training.............................................................................................. -67-
33       Settlement of Disputes/Arbitration/Litigation......................................................... -67-
34       Applicable Law........................................................................................ -69-
35       Notices............................................................................................... -69-
36       Publicity and Confidentiality......................................................................... -70-
37       Assignment............................................................................................ -71-
38       Relationship of the Parties........................................................................... -72-
</TABLE>

                                      -i-
<PAGE>   3
<TABLE>
<CAPTION>
Article                                                                                                        PAGE
-------                                                                                                        ----
<S>                                                                                                            <C>
39       Successors Bound...................................................................................... -73-
40       Article Captions; Joint Drafting...................................................................... -73-
41       Severability.......................................................................................... -73-
42       Guarantor............................................................................................. -73-
43       Survival of Obligations............................................................................... -73-
44       Non-Waiver............................................................................................ -73-
45       Language.............................................................................................. -74-
46       Entire Agreement...................................................................................... -74-
</TABLE>

<TABLE>
<CAPTION>
<S>               <C>
Exhibit A         Network Configuration
Exhibit B         Form of Parent Guaranty
Exhibit C         Form of Consent and Agreement
Exhibit D-1       Form of Opinion for Contractor
Exhibit D-2       Form of Opinion for Guarantor
Exhibit E         Form of Escrow Agreement
Exhibit F         First Office Applications
Exhibit G         Subcontractors
Exhibit H         Intellectual Property
Exhibit I         Landing Licenses
Exhibit J         Examples of Contractor Permits
Exhibit K         Examples of Owner Permits
Exhibit L         Form of Supplement
Exhibit M         Form of Indemnity and Confirmation Agreement
</TABLE>

                                      -ii-
<PAGE>   4
                             PROJECT DEVELOPMENT AND
                              CONSTRUCTION CONTRACT

                  This Project Development and Construction Contract
("Contract") is made as of the 17th day of December, 1999 between KDD Submarine
Cable Systems Inc., a Japanese corporation organized and existing under the laws
of Japan, and having its principal office in Tokyo, Japan (hereinafter
"Contractor") and Asia Global Crossing Ltd., a corporation organized and
existing under the laws of Bermuda, and having its principal office in Hamilton,
Bermuda (hereinafter "Purchaser").

                  WHEREAS, Purchaser desires to establish a fiber optic cable
system, to be known as the East Asian Crossing Cable System (hereinafter, and as
more fully defined herein, the "System"), which will be used to provide service
among the Segments as described in Exhibit A hereto;

                  WHEREAS, Contractor is in the business of designing,
constructing, installing, supplying, delivering and manufacturing fiber optic
cable systems and is familiar with the general business of the fiber optic cable
system industry;

                  WHEREAS, Purchaser seeks to purchase and own the System and
wishes to engage Contractor to perform the Work and Upgrade Work; and

                  WHEREAS, Contractor is willing to perform the Work and Upgrade
Work on a turn-key, fixed-price basis in accordance with and subject to the
terms hereof.

                  NOW, THEREFORE, in consideration of the premises and for other
good and valuable considerations, receipt of which is hereby acknowledged, it
has been agreed as follows:

ARTICLE 1         PROVISION OF SYSTEM

                  In consideration of the Contract Price and the Upgrade Prices,
the Contractor hereby agrees to perform the Work and the Upgrade Work, on a
turn-key, fixed price basis, and to provide Purchaser with the System meeting
the System Performance Requirements on or before the Scheduled RFS Date(s) and
the System Upgrades meeting the requirements of Article 6A, all in accordance
with the terms hereof.

                  Contractor understands that parts of the System comprising
portions of the cable stations in Qingdao, China, and Shima, Japan, are intended
to be installed by other contractor(s) (the components of the System described
in this sentence are herein referred to as the "Other Facilities"). The
Contractor agrees to reasonably cooperate with Purchaser and such other
contractor(s), as necessary, including with respect to (i) formulating and
carrying out installation, (ii) Contractor's and each such other contractor's
obligation to formulate testing procedures and (iii) ensuring that the System
properly interoperates with the Other Facilities to which it will be connected;
provided that the Contractor shall not be responsible for problems with
interoperability within the System caused by equipment installed by such other
contractors so
<PAGE>   5
                                                                               2

long as Contractor has complied with the provisions of this Agreement and of the
Technical Volume regarding interoperability, such equipment and such other
contractors.

ARTICLE 2         DOCUMENTS FORMING THE ENTIRE CONTRACT

                  This Contract consists of these commercial Terms and
Conditions, Exhibits A through M, and the following documents (in the form of
attachments, including appendices, attached hereto), which shall be read and
construed as part of the Contract:

         -        Provisioning Schedule, Appendix 1, Upgrade Provisioning
                  Schedule, Appendix 1A

         -        Billing Schedule, Appendix 2, Upgrade Billing Schedule,
                  Appendix 2A

         -        Plan of Work, Appendix 3, Upgrade Plan of Work, Appendix 3A

         -        Invoice Format, Appendix 4, Form of Contractor's Certificate,
                  Appendix 4A

         -        Progress Schedule, Appendix 5, Upgrade Progress Schedule,
                  Appendix 5A

         -        Technical Volume (includes Route Information), Appendix 6

                  In the event of any inconsistency between the Terms and
Conditions and the above listed documents, the Terms and Conditions shall
prevail. The Appendices listed above have no order of precedence.

ARTICLE 3         DEFINITIONS

                  Terms used herein which are not defined herein, but which have
common meanings when used in the telecommunications industry, shall have such
common meanings when used herein. Definitions are as described in the specific
Articles. Except as otherwise defined the following definitions shall apply
throughout the Contract:

                  AAA has the meaning set forth in Sub-Article 33(B).

                  ACCEPTANCE TESTING means (i) with respect to a Segment, a
         Phase or the System, the tests described in the System Commissioning
         and Acceptance section of the Technical Volume or developed pursuant to
         such section by mutual agreement of the Parties (with 15 days prior
         notice to the Independent Engineer) and designed to verify that such
         Segment or the System meets the applicable Performance Requirements and
         (ii) with respect to any System Upgrade, the tests described in the
         System Commissioning and Acceptance section of the Technical Volume or
         developed pursuant to such section by mutual agreement of the Parties
         (with 15 days prior notice to the Independent Engineer) and designed to
         verify that the System Upgrade meets the applicable Performance
         Requirements.

                  ACCESS RIGHTS means all ownership, easement, wayleaves and/or
         other property rights, from both private and governmental entities,
         both on land and below the surface of the water (including, without
         limitation, agreements to use borepipes, conduits and ducts, install
         manholes and to lease space in cable stations) necessary to access, use
         and occupy cable stations and the sites for cable stations (including,
         without limitation, to land and
<PAGE>   6
                                                                               3

         install the submarine cable and related equipment and to bring such
         cable from the ocean to the cable stations) in order for the Purchaser
         to own, operate and maintain the System.

                  ACTUAL KNOWLEDGE means the actual knowledge of any executives
         with management responsibility for the Contract.

                  AJIGAURA CABLE STATION means the System cable station to be
         located in Ajigaura, Japan to be built on land to be provided by the
         Purchaser.

                  ASSIGNMENT has the meaning set forth in Sub-Article 37(A).

                  BANK ESCROW AGENT means The Chase Manhattan Bank or Deutsche
         Bank, New York Branch, as chosen by Purchaser, in its capacity as
         escrow agent under the Payment Escrow Agreement, and its successors in
         such capacity.

                  BANKRUPTCY EVENT means an event specified in Sub-Article
         13(A)(3) or 13(A)(4) with Contractor as the "other Party".

                  BILLING MILESTONES means the billing milestones set forth in
         Appendix 6.

                  BILLING SCHEDULE means a billing schedule attached hereto as
         Appendix 2.

                  BRANCHING UNIT 1 means the branching unit in Segment B
         attached to the System off the coast of Taiwan, which would allow the
         System to be connected to the Shar Fu Cable Station at a location
         capable of interconnecting with major telecommunications carriers, as
         more specifically described in the Technical Volume.

                  BRANCHING UNIT 2 means the branching unit in Segment E
         attached to the System off the coast of Taiwan which would allow the
         System to be connected to the Shar Fu Cable Station at a location
         capable of interconnecting with major telecommunications carriers, as
         more specifically described in the Technical Volume.

                  BRANCHING UNIT 3 means the branching unit in Segment H
         attached to the System off the coast of Korea, which would allow the
         System to be connected to the Taean Cable Station at a location capable
         of interconnecting with major telecommunications carriers, as more
         specifically described in the Technical Volume.

                  BRANCHING UNIT 4 shall mean the branching unit in Segment J
         attached to the System off the coast of Korea, which would allow the
         System to be connected to the Taean Cable Station at a location capable
         of interconnecting with major telecommunications carriers, as more
         specifically described in the Technical Volume.

                  CERTIFICATE OF COMMERCIAL ACCEPTANCE means a certificate
         issued by Purchaser in accordance with Sub-Article 9(D) to Contractor
         certifying that a Segment, a Phase, the System or a System Upgrade is
         Ready for Commercial Acceptance.
<PAGE>   7
                                                                               4

                  CERTIFICATE OF FINAL ACCEPTANCE means a certificate issued by
         Purchaser in accordance with Sub-Article 9(E) to Contractor certifying
         that the System or a System Upgrade is Ready for Final Acceptance.

                  CERTIFICATE OF PROVISIONAL ACCEPTANCE means a certificate
         issued by Purchaser in accordance with Sub-Article 9(C) to Contractor
         certifying that a Segment, a Phase, the System or a System Upgrade is
         Ready for Provisional Acceptance.

                  CIF means cost, insurance and freight, as defined in
         Incoterms.

                  CODE means the Internal Revenue Code of 1986, as amended from
         time to time.

                  COMMISSIONING REPORT means a written report from Contractor
         demonstrating that the System (or a Segment, if Purchaser agrees to
         accept it) is Ready for Commercial Acceptance or Provisional
         Acceptance, as the case may be, and has passed all Acceptance Testing
         and all other acceptance and performance requirements set forth in the
         System Commissioning and Acceptance section of the Technical Volume.

                  CONFIDENTIAL INFORMATION has the meaning set forth in
         Sub-Article 36(B).

                  CONSENT means a Consent and Agreement to be entered into among
         Contractor, Purchaser and the financing parties described in
         Sub-Article 37(C) and substantially in the form of Exhibit C hereto,
         with such changes therein as made pursuant to Sub-Article 37(C) hereto.

                  CONTRACT means this agreement, specifically consisting of the
         documents described in Article 2, and shall be deemed to include any
         amendments thereto or Contract Variations pursuant to Article 6
         (Contract Variations).

                  CONTRACT COUNTRIES means Taiwan, Hong Kong, S.A.R., China, the
         People's Republic of China, the Republic of Korea and Japan, or any
         political subdivision thereof or taxing authority therein.

                  CONTRACT PRICE means the Initial Contract Price, plus any
         variations pursuant to Article 6 (Contract Variations), Taxes as set
         forth in Sub-Article 4(B) and other adjustments to the Contract Price
         provided for in this Contract.

                  CONTRACT TAXES has the meaning set forth in Sub-Article
         4(B)(1).

                  CONTRACT VARIATION has the meaning set forth in Sub-Article
         6(A).

                  CONTRACTOR means the entity that executed this Contract as the
         Contractor and that will be responsible for the performance of the Work
         (and if applicable, Upgrade Work) under this Contract and shall include
         its permitted successors and/or assigns.
<PAGE>   8
                                                                               5

                  CONTRACTOR PERMITS means (i) all permits that the Contractor
         needs to conduct its business, (ii) all Permits which the Contractor
         must obtain in order to carry out its operations to perform the Work
         and (iii) minor and routine construction and building Permits such as
         licenses to install electricity and plumbing. Exhibit J hereto contains
         a list of sample Contractor Permits; provided that such list is not
         meant to be complete or exclusive.

                  DATE OF COMMERCIAL ACCEPTANCE, PROVISIONAL ACCEPTANCE OR FINAL
         ACCEPTANCE means the date set forth in the Certificate of Commercial
         Acceptance, Certificate of Provisional Acceptance or Certificate of
         Final Acceptance, as the case may be; provided, that for purposes of
         Article 22 (Liquidated Damages) only, such date shall be deemed to be
         the date that Purchaser receives a complete Commissioning Report or an
         Upgrade Commissioning Report, as the case may be, demonstrating that a
         Segment, a Phase, the System or a System Upgrade, as the case may be,
         is Ready for Commercial Acceptance, Ready for Provisional Acceptance or
         Ready for Final Acceptance in accordance with Article 9 (Acceptance).

                  DEFAULT means an Event of Default or any event, condition or
         occurrence which with the giving of notice or passage of time or both
         would be an Event of Default.

                  DELIVERABLE SOFTWARE has the meaning set forth in Sub-Article
         18(C).

                  DELIVERABLE SOFTWARE ESCROW has the meaning set forth in
         Sub-Article 18(H).

                  DELIVERABLE TECHNICAL MATERIAL has the meaning set forth in
         Sub-Article 18(B).

                  DISPUTE ACCOUNT means the Dispute Account to be created under
         the Payment Escrow Agreement.

                  EVENT OF DEFAULT has the meaning set forth in Sub-Article
         13(A).

                  EXCLUDED TAX means a Tax described in any of the following
         clauses:

                  (i) any franchise, excess profits, net worth, capital or
         capital gains Tax, as well as any Tax on doing business or imposed on
         net or gross income or receipts (including minimum and alternative
         minimum Taxes measured by any items of Tax preference), but in each
         case excluding Taxes that are or are in the nature of sales, use,
         excise, license, stamp, rental, ad valorem, value added or property
         Taxes (other than property taxes on property owned by the Contractor
         and not intended to be incorporated into the System);

                  (ii) any Taxes imposed by a jurisdiction other than one in
         which (a) the Contractor is or is treated as engaged in activities
         contemplated by or in fulfillment of the Contract or (b) the Purchaser
         or its affiliates has a nexus to such jurisdiction and the Tax imposed
         is attributable to that nexus;
<PAGE>   9
                                                                               6

                  (iii) Taxes imposed on the Contractor as a result of
         Contractor's gross negligence or willful misconduct; or

                  (iv) any import duty, other import related charges, sales or
         use tax, VAT, consumption tax or property tax imposed by any
         Non-Contract Country in respect of Supplies brought into such
         Non-Contract Country for testing, modification or other similar
         purposes prior to being installed or used outside such Non-Contract
         Country.

                  EXPEDITED UPGRADE has the meaning set forth in Sub-Article
         6A(L).

                  FINAL COMMISSIONING REPORT AND FINAL UPGRADE COMMISSIONING
         REPORT means a written report from Contractor demonstrating that the
         System (or a Segment, if Purchaser agrees to accept it) is Ready for
         Final Acceptance and has passed all Acceptance Testing and all other
         acceptance and performance requirements set forth in the System
         Commissioning and Acceptance section of the Technical Volume.

                  FINAL SURVEY REPORT means the final survey report described in
         the Marine Installation section of the Technical Volume.

                  FOB means free on board as defined in the International
         Chamber of Commerce, Guide to Incoterms (1990).

                  FORCE MAJEURE has the meaning set forth in Sub-Article 17(A).

                  GLOBAL MARINE means Global Marine Systems Ltd.

                  GUARANTOR means KDD Corporation, a Japanese corporation and
         the ultimate parent company of the Contractor.

                  GUARANTY means the guaranty to be entered into by the
         Guarantor in favor of the Purchaser, to be substantially in the form of
         Exhibit B hereto.

                  HONG KONG CABLE STATION means the System cable station to be
         located in Hong Kong, S.A.R., China.

                  INCOTERMS means the International Chamber of Commerce, Guide
         to Incoterms (1990).

                  INDEPENDENT ENGINEER means Conexart Technologies, Inc., or a
         similarly qualified successor in the capacity as the engineer to the
         financing sources specified in Sub-Article 37(C) who has agreed to be
         bound by the confidentiality provisions of this Contract and who is not
         affiliated with a competitor of Contractor.

                  INFORMATION has the meaning set forth in Sub-Article 20(A).
<PAGE>   10
                                                                               7

                  INITIAL CONTRACT PRICE has the meaning set forth in
         Sub-Article 4(A)(1).

                  INITIAL UPGRADE PRICE has the meaning set forth in Sub-Article
         4(A)(2).

                  INSTALLATION INTERVAL has the meaning set forth in Sub-Article
         6A(L)(1).

                  INTELLECTUAL PROPERTY has the meaning set forth in Sub-Article
         18(A).

                  LANDING COUNTRY(IES) means each country in which the System
         connects to a cable station.

                  LANDING LICENSES means those licenses comparable to a License
         to Land and Operate a Submarine Cable System pursuant to the Submarine
         Cable Landing Act, 47 U.S.C. 34-39, which licenses are specifically
         described in Exhibit I hereto.

                  LAWS means any laws, ordinances, regulations, rules, orders,
         proclamations, requirements of governmental authorities or treaties.

                  LUCENT means Lucent Technologies Inc.

                  MANUFACTURING MATERIALS has the meaning set forth in
         Sub-Article 13(B).

                  NON-CONTRACT COUNTRIES means all countries, or any political
         subdivision thereof or taxing authority therein, other than the
         Contract Countries.

                  NON-SHIP COSTS has the meaning set forth in Sub-Article
         10(A)(2).

                  NOTICE OF TERMINATION has the meaning set forth in Sub-Article
         14(A).

                  OWNER PERMITS means all Permits required to be obtained from
         governmental authorities pursuant to Laws that the Purchaser needs to
         own and operate the System and which the Purchaser would have had to
         obtain if it were constructing the System itself. Exhibit K contains a
         sample list of Owner Permits; provided that such list is not meant to
         be complete or exclusive.

                  PARTY(IES) means either of the Purchaser and/or the
         Contractor, as appropriate.

                  PAYMENT ESCROW AGREEMENT means that escrow agreement to be
         entered into among the Contractor, Purchaser, and the Bank Escrow
         Agent, substantially in the form of Exhibit E hereto, with such changes
         therein as are reasonably requested by the Bank Escrow Agent, as
         amended modified or supplemented from time to time.

                  PERFORMANCE REQUIREMENTS means (i) with respect to a Segment,
         a Phase or the System, the applicable System Performance Requirements
         set forth or to be developed by mutual agreement pursuant to the
         Transmission Performance section of the System
<PAGE>   11
                                                                               8

         Description section of the Technical Volume, (ii) with respect to any
         System Upgrade, the System Performance Requirements set forth in or to
         be developed by mutual agreement pursuant to the Technical Volume or
         (iii) in each case, such other Segment, Phase, System or System Upgrade
         performance levels as mutually agreed by the Parties, including the
         System acceptance limits included in the impairment budgets.

                  PERMITS means all Access Rights, permits, pipeline and cable
         crossing agreements, approvals, "no objections",
         permissions-in-principle, authorizations, consents, customs clearances,
         registrations, certificates, rights-of-way, certificates of occupancy,
         licenses, including without limitation, export and import licenses and
         similar authorizations, landing permits, orders, vessel and crew
         authorizations/visas, permission for the operation of navigational aids
         and radio systems and similar authorizations necessary to complete the
         Work and operate and maintain the System (other than any of the
         foregoing (i) relating to the ownership, operation and maintenance by
         Purchaser of the System and not necessary until after the System is
         Ready for Final Acceptance, (ii) which is or would be needed by
         Purchaser to engage in any business outside the business of developing,
         owning and operating a submarine cable system or (iii) which is or
         would be needed at any time by any purchaser or lessee of capacity on
         the System). Permits include all of the foregoing whether required to
         be obtained from governmental entities or private parties. The term
         Permits includes all Contractor Permits and all Owner Permits, but
         excludes Purchaser Permits.

                  PHASE 1A means Segments A and C and that portion of Segment B
         containing Branching Unit 1 and the ten (10) kilometers of stubbed
         cable from Branching Unit 1 towards the Shar Fu Cable Station, all as
         more fully described in the Technical Volume.

                  PHASE 1A PRICE has the meaning set forth in Sub-Article 4(A).

                  PHASE 1B means Segment B (less that portion included in Phase
         1A), Segments D, E (including Branching Unit 2), F, G, H (including
         Branching Unit 3), I, J (including Branching Unit 4), K and L, all as
         more fully described in the Technical Volume.

                  PHASE 1B PRICE has the meaning set forth in Sub-Article 4(A).

                  PLAN OF WORK means the Plan of Work attached as Appendix 3
         hereto.

                  PROVISIONING SCHEDULE means the price schedule attached hereto
         in Appendix 1.

                  PURCHASER means Asia Global Crossing Ltd. and shall include
         its permitted successors and assigns.

                  PURCHASER HINDRANCE has the meaning set forth in Article 12
         hereof.

                  PURCHASER PERMITS means, collectively, all Landing Licenses.
<PAGE>   12
                                                                               9

                  QINGDAO CABLE STATION means the System cable station to be
         located in Qingdao, China, which shall be furnished by Purchaser.

                  READY FOR COMMERCIAL ACCEPTANCE means

                  (i)      for any Segment, that

                           (a)      if the Phase including such Segment is not
                                    at the same time also Ready for Commercial
                                    Acceptance, the Purchaser has consented, in
                                    its sole discretion, to accept such Segment
                                    as Ready for Commercial Acceptance,

                           (b)      such Segment has been substantially
                                    completed and has the ability to carry
                                    commercial traffic between the two landing
                                    points of such Segment meeting performance
                                    criteria of ITU-T G.826 as defined in the
                                    System Performance section of the Technical
                                    Volume and has line monitoring and
                                    protection switching capability,

                           (c)      Contractor has tested and provided for STM-1
                                    and/or STM-16 interconnectivity capability
                                    to the Segment terminal equipment according
                                    to ITU-T G.826 or, if a different interface
                                    rate is used, an equivalent standard,

                           (d)      Contractor has substantially performed its
                                    obligations under Article 18 (Intellectual
                                    Property) then required to be performed by
                                    it, and

                           (e)      all Permits are obtained for such Segment,
                                    and copies of such Permits with English
                                    translations are delivered to Purchaser, and

                  (ii)     for any Phase, that

                           (a)      such Phase has been substantially completed
                                    and has the ability to carry commercial
                                    traffic operating at 20 Gb/s per fiber pair
                                    on four fiber pair between the various
                                    landing points of such Phase meeting
                                    performance criteria of ITU-T G.826 as
                                    defined in the System Performance section of
                                    the Technical Volume, has line monitoring
                                    and per Segment protection switching
                                    capability and has network management
                                    capability,

                           (b)      Contractor has tested and provided for STM-1
                                    and/or STM-16 interconnectivity capability
                                    to the System terminal equipment according
                                    to ITU-T G.826 or if a different interface
                                    rate is used, an equivalent standard,
<PAGE>   13
                                                                              10

                           (c)      Contractor has substantially performed its
                                    obligations under Article 18 (Intellectual
                                    Property) then required to be performed by
                                    it, and

                           (d)      all Permits are obtained for such Phase,
                                    copies of such Permits with English
                                    translations are delivered to Purchaser, and

                  (iii)    for the System, that

                           (a)      the System has been substantially completed
                                    and has the ability to carry commercial
                                    traffic throughout the System (operating at
                                    20 Gb/s per fiber pair on four fiber pair)
                                    meeting performance criteria of ITU-T G.826
                                    as defined in the System Performance section
                                    of the Technical Volume, has line monitoring
                                    and per Segment protection switching
                                    capability and has network management
                                    capability,

                           (b)      Contractor has tested and provided for STM-1
                                    and/or STM-16 interconnectivity capability
                                    to the System terminal equipment according
                                    to ITU-T G.826, or, if a different interface
                                    rate is used, an equivalent standard,

                           (c)      Contractor has substantially performed its
                                    obligations under Article 18 (Intellectual
                                    Property) then required to be performed by
                                    it,

                           (d)      all Permits are obtained for the System, and
                                    copies of such Permits with English
                                    translations are delivered to Purchaser, and

                           (e)      the System has self-healing ring protection
                                    capability, and

                  (iv)     for any System Upgrade, the System is Ready for
                           Commercial Acceptance at the capacity specified for
                           such System Upgrade.

                  READY FOR FINAL ACCEPTANCE means

                  (i)      for the System, that

                           (a)(I)   the System has successfully and continuously
                                    (other than by reason of Force Majeure in
                                    which case the test period shall be extended
                                    for a time period agreed between the
                                    Parties) functioned in compliance with the
                                    System Performance Requirements during the
                                    period of ninety (90) consecutive days after
                                    the Date of Provisional Acceptance, or

                           (II)     if the System shall have failed to meet the
                                    System Performance Requirements at any time
                                    during such period (other than by reason of
                                    Force Majeure), the Contractor has corrected
                                    such failure and
<PAGE>   14
                                                                              11

                                    the System has successfully and continuously
                                    (other than by reason of Force Majeure in
                                    which case the test period shall be extended
                                    for a time period agreed between the
                                    Parties) functioned in compliance with the
                                    System Performance Requirements for such
                                    additional period of time not to exceed
                                    ninety (90) days (and not to end prior to
                                    the date ninety (90) days after the Date of
                                    Provisional Acceptance) as reasonably
                                    determined by the Purchaser as being
                                    sufficient to confirm that such failure has
                                    been corrected and that no other failures
                                    are likely to appear,

                           (b)      all deficiencies noted in the Certificate of
                                    Provisional Acceptance have been corrected
                                    (other than minor deficiencies which will
                                    not affect the operation of the System, in
                                    respect of which an equitable adjustment to
                                    the Contract Price will be made), and

                           (c)      Contractor has complied in all material
                                    respects with Article 18 (Intellectual
                                    Property), and

                  (ii)     for any System Upgrade, that

                           (a)(I)   the System Upgrade has successfully
                                    functioned in compliance with the System
                                    Performance Requirements during the period
                                    of ninety (90) days after the Date of
                                    Provisional Acceptance of the System
                                    Upgrade, or

                           (II)     if the System Upgrade shall have failed to
                                    meet the System Performance Requirements
                                    during such period, the Contractor has
                                    corrected such failure and the System
                                    Upgrade has successfully functioned in
                                    compliance with the System Performance
                                    Requirements for such additional period of
                                    time not to exceed ninety (90) days as
                                    reasonably determined by the Purchaser as
                                    sufficient to confirm that such failure has
                                    been corrected, and

                           (b)      all deficiencies noted in the Certificate of
                                    Provisional Acceptance have been corrected
                                    (other than minor deficiencies which will
                                    not affect the operation of the System, in
                                    respect of which an equitable adjustment of
                                    the Contract Price will be made), and

                           (c)      Contractor has complied in all material
                                    respects with Article 18 (Intellectual
                                    Property).

                  READY FOR PROVISIONAL ACCEPTANCE means

                  (i)      with respect to any Segment,
<PAGE>   15
                                                                              12

                           (a)      if the Phase including such Segment is not,
                                    at the same time, also Ready for Provisional
                                    Acceptance, the Purchaser has consented, in
                                    its sole discretion, to accept such Segment
                                    as Ready for Provisional Acceptance,

                           (b)      such Segment is complete in all material
                                    respects (and in any event is Ready for
                                    Commercial Acceptance),

                           (c)      the results of Acceptance Testing of such
                                    Segment demonstrate that such Segment has
                                    satisfied the System Performance
                                    Requirements,

                           (d)      Contractor has substantially performed its
                                    obligations under Article 18 (Intellectual
                                    Property) then required to be performed by
                                    it,

                           (e)      all Permits are obtained for such Segment,
                                    and copies of such Permits with English
                                    translations are delivered to Purchaser, and

                  (ii)     with respect to any Phase, such Phase is complete in
                           all material respects (and in any event is Ready for
                           Commercial Acceptance), all Segments of such Phase
                           are Ready for Provisional Acceptance with per Segment
                           protection capability, line monitoring and network
                           management capability,

                  (iii)    with respect to the System, the System is complete in
                           all material respects (and in any event is Ready for
                           Commercial Acceptance), all Segments are Ready for
                           Provisional Acceptance with per Segment protection
                           capability, line monitoring and network management
                           capability and self-healing ring protection
                           capability, and

                  (iv)     with respect to any System Upgrade, the results of
                           Acceptance Testing of such System Upgrade demonstrate
                           that such System Upgrade is complete in all material
                           respects and is sufficient to realize the Performance
                           Requirements.

                  REPRESENTATIVES has the meaning set forth in Article 36(B).

                  RETAINAGE means (a) in the case of the System, an amount equal
         to*    of the Initial Contract Price and (b) in the case of each System
         Upgrade, an amount equal to*    of the Initial Upgrade Price.

                  RETESTING has the meaning set forth in Sub-Article 9(B)(3).

                  ROUTE SURVEY means the route survey described in the Route
         Survey, Cable Loading and Marine Operations section of the Technical
         Volume.

                  SCHEDULED PHASE 1A RFS DATE has the meaning set forth in
         Sub-Article 9(A).

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.

<PAGE>   16
                                                                              13

                  SCHEDULED PHASE 1B RFS DATE has the meaning set forth in
         Sub-Article 9(A).

                  SCHEDULED RFS DATE(S) means any of the Scheduled Phase 1A RFS
         Date, the Scheduled Phase 1B RFS Date and/or the Scheduled System RFS
         Date.

                  SCHEDULED SYSTEM RFS DATE has the meaning set forth in
         Sub-Article 9(A).

                  SCHEDULED UPGRADE DATE means for any System Upgrade, the date
         by which the Contractor agrees such System Upgrade will be Ready for
         Provisional Acceptance or Commercial Acceptance.

                  SEGMENT means any of Segments A through L.

                  SEGMENT A means the portion of the System containing the Shima
         Cable Station and the four fiber pair facility from Shima, Japan to
         Branching Unit 1.

                  SEGMENT B means the portion of the System containing the Shar
         Fu Cable Station and the four fiber pair facility from and including
         Branching Unit 1 to Shar Fu, Taiwan and landing in Shar Fu in a
         location capable of interconnecting with major telecommunications
         carriers.

                  SEGMENT C means the portion of the System containing the four
         fiber pair facility from Branching Unit 1 to Lantau Island, Hong Kong,
         S.A.R., China and landing in Lantau Island in a location capable of
         interconnecting with major telecommunications carriers and that portion
         of the Hong Kong Cable Station necessary to operate Segment C as a part
         of Phase 1A.

                  SEGMENT D means the portion of the System containing the Hong
         Kong Cable Station, less the portion thereof delivered as part of
         Segment C, and the four fiber pair facility from Hong Kong, S.A.R.,
         China to Branching Unit 2.

                  SEGMENT E means the portion of the System containing the four
         fiber pair facility from and including Branching Unit 2 to Shar Fu,
         Taiwan and landing in Shar Fu in a location capable of interconnecting
         with major telecommunications carriers.

                  SEGMENT F means the portion of the System containing the four
         fiber pair facility from Branching Unit 2 to Qingdao, China and landing
         in Qingdao in a location capable of interconnecting with major
         telecommunications carriers.

                  SEGMENT G means the portion of the System containing the
         Qingdao Cable Station and the four fiber pair facility from Qingdao,
         China to Branching Unit 3.
<PAGE>   17
                                                                              14

                  SEGMENT H means the portion of the System containing the two
         fiber pair facility from and including Branching Unit 3 to Taean, Korea
         and landing in Taean in a location capable of interconnecting with
         major telecommunications carriers.

                  SEGMENT I means the portion of the System containing the two
         fiber pair facility from Branching Unit 3 to Branching Unit 4.

                  SEGMENT J means the portion of the System containing the Taean
         Cable Station and the two fiber pair facility from and including
         Branching Unit 4 to Taean, Korea and landing in Taean in a location
         capable of interconnecting with major telecommunications carriers.

                  SEGMENT K means the portion of the System containing the four
         fiber pair facility from Branching Unit 4 to Ajigaura, Japan and
         landing in Ajigaura, in a location capable of interconnecting with
         major telecommunications carriers.

                  SEGMENT L means the portion of the System containing the
         Ajigaura Cable Station and the four fiber pair facility from Ajigaura,
         Japan to Shima, Japan and landing in Shima in a location capable of
         interconnecting with major telecommunications carriers.

                  SHAR FU CABLE STATION means the System cable station to be
         located in Shar Fu, Taiwan.

                  SHIMA CABLE STATION means the cable station to be located in
         Shima, Japan, which shall be furnished by Purchaser.

                  SHIP COSTS has the meaning set forth in Sub-Article 10(A)(2).

                  SHIP PERIOD has the meaning set forth in Sub-Article 10(A).

                  SOFTWARE ESCROW AGREEMENT means the escrow agreement described
         in Sub-Article 18(H).

                  SUBCONTRACTOR means a contractor, vendor, supplier, licensor
         or other person having a direct or indirect contract with the
         Contractor or with any other Subcontractor of the Contractor who has
         been hired specifically to assist the Contractor in certain specified
         areas of its performance of its obligations under this Contract
         including, without limitation, performance of any part of the Work.

                  SUPPLIES means any and all materials, plant, machinery,
         equipment, hardware and items supplied by the Contractor under this
         Contract.

                  SUSPENSION means a suspension in all or part of the Work
pursuant to Sub-Article 15(A) or 15(B).
<PAGE>   18
                                                                              15

                  SYSTEM means the fiber optic cable system as described in
         Exhibit A and the Technical Volume.

                  SYSTEM PERFORMANCE REQUIREMENTS has the meaning set forth in
         Section 2 of the Technical Volume.

                  SYSTEM UPGRADE has the meaning set forth in Sub-Article 6A(A).

                  TAEAN CABLE STATION means the cable station to be located in
         Taean, Korea.

                  TAX means any tax, duty, levy, charge or custom (including,
         without limitation, any sales or use tax, VAT or octroi duty relating
         to the Contract items and fiscal stamps connected with Contract
         legalization) imposed or collected by any taxing authority or agency
         (domestic or foreign).

                  TECHNICAL VOLUME means the Technical Volume attached hereto as
         Appendix 6.

                  TRANSFEREE means any entity to which Purchaser assigns rights
         hereunder pursuant to Sub-Article 37(D) hereof.

                  UPGRADE BILLING SCHEDULE means the billing schedule attached
         hereto as Appendix 2A.

                  UPGRADE COMMISSIONING REPORT means a written report from
         Contractor demonstrating that a System Upgrade is Ready for Commercial
         Acceptance or Provisional Acceptance, as the case may be, and has
         passed all Acceptance Testing and all other acceptance and performance
         requirements set forth in the System Commissioning and Acceptance
         section of the Technical Volume.

                  UPGRADE OPTION PERIOD has the meaning set forth in Sub-Article
         6A(B).

                  UPGRADE PERIOD has the meaning set forth in Sub-Article 6A(E).

                  UPGRADE PLAN OF WORK means the plan of work attached hereto as
         Appendix 3A.

                  UPGRADE PRICE means, for any System Upgrade, the Initial
         Upgrade Price for such System Upgrade, plus any variations pursuant to
         Article 6 (Contract Variations), Taxes as set forth in Sub-Article 4(B)
         and other adjustments to such Upgrade Price provided for in this
         Contract.

                  UPGRADE PROVISIONING SCHEDULE means the provisioning schedule
         attached hereto as Appendix 1A.

                  UPGRADE WARRANTY PERIOD has the meaning set forth in
         Sub-Article 10(A).
<PAGE>   19
                                                                              16

                  UPGRADE WORK means the activities and services to be performed
         or provided by Contractor under Article 6A (Optional Upgrades).

         *

                  WARRANTY PERIOD has the meaning set forth in Sub-Article
         10(A).

                  WORK means all activities and services (other than the
         activities and services specified in this Contract to be provided by
         Purchaser) necessary to be performed or provided in developing,
         planning, engineering, designing, manufacturing, constructing,
         delivering, installing and testing the System until the System is Ready
         for Final Acceptance, including without limitation, designating,
         coordinating and obtaining all Permits, except for the Purchaser
         Permits. Whether or not used in conjunction with the term "Supplies",
         the term "Work" shall always be deemed to include the provision of the
         relevant Supplies, unless the context requires otherwise.

                  YEAR 2000 COMPLIANT means, when used with respect to any
         software or materials, that such software or materials will operate
         accurately and, without interruption, accept, possess and in all manner
         retain full functionality when referring to, or involving, any year or
         date in the twentieth or twenty first centuries.

ARTICLE 4         CONTRACT PRICE

         A.       Contract Price

                  1.       The initial Contract Price for the Work, in United
                           States Dollars (US$) is a fee of       *      (the
                           "Initial Contract Price") which is composed of the
                           Phase 1A Price of    *     (the "Phase 1A Price")
                           and the Phase 1B price of      *      (the "Phase 1B
                           Price). The Initial Contract Price does not include
                           the cost of optional upgrades which are described in
                           Article 6A (Optional Upgrades), any contract
                           variations as provided for in Article 6 (Contract
                           Variations) or any Taxes. The Initial Contract Price
                           includes all charges for CIF and all costs and
                           expenses incurred in obtaining all Permits (including
                           Access Rights).

                  2.       The initial Upgrade Price for any Upgrade Work, in
                           United States Dollars (US$) is the fixed fee set
                           forth in Sub-Article 6A(G), payable as set forth in
                           Appendix 2A (the "Initial Upgrade Price"). No Initial
                           Upgrade Price includes the cost of any contract
                           variations as provided for in Article 6 (Contract
                           Variations) or any Taxes.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.

<PAGE>   20
                                                                              17

                  3.       (a)      The Provisioning Schedule sets forth the
                                    Contractor's breakdown of the Initial
                                    Contract Price among various aspects of the
                                    Work. If the actual cost of any aspect of
                                    the Work is greater or less than that set
                                    forth in the Provisioning Schedule, such
                                    fact shall not cause any change in the
                                    Initial Contract Price.

                           (b)      At its discretion, the Purchaser may direct
                                    the Contractor to deliver either Universal
                                    Joints conforming to qualified Universal
                                    Jointing Consortium Technology or Contractor
                                    proprietary joints as spares, in such
                                    quantities as provided in the Provisioning
                                    Schedule; such direction may be given during
                                    the course of the Work, but not later than
                                    such date as the Parties shall mutually
                                    agree, and such direction, whichever spare
                                    joint type is selected, shall not cause any
                                    change in the Initial Contract Price.

                  4.       Without the prior written consent of the Purchaser,
                           which consent shall not be unreasonably withheld or
                           delayed, the Contractor shall not arrange for any

                           (a)      Access Right which requires payments to be
                                    made by the Purchaser or made after the
                                    System is Ready for Provisional Acceptance,
                                    or

                           (b)      Permit which requires aggregate payments in
                                    excess of $250,000 to be made by Purchaser
                                    or made after the System is Ready for
                                    Provisional Acceptance.

                  5.       The Contractor and the Purchaser will share equally
                           the costs and expenses of the Payment Escrow Agent.

         B.       Taxes, Levies and Duties

                  1.       The Initial Contract Price and each Initial Upgrade
                           Price, as stated in Sub-Article 4(A) above, excludes
                           any Tax. The Contract Price and each Upgrade Price
                           shall without duplication be adjusted for any Tax
                           imposed on or in connection with this Contract
                           (including, without limitation, the execution and
                           delivery of this Contract, the Work, the Upgrade Work
                           and the Supplies, but excluding any Excluded Taxes)
                           (any such Taxes, other than Excluded Taxes, are
                           hereinafter referred to as "Contract Taxes").
                           Contractor has provided a good faith estimate of the
                           Contract Taxes payable by the Purchaser; it being
                           understood that the Contractor shall have no
                           liability under this Contract or otherwise to the
                           Purchaser for any errors or omissions in such
                           estimate or any losses arising therefrom. The
                           Contractor shall be responsible for any Excluded Tax
                           that might be incurred by the Contractor as well as
                           any Tax described in clause (iv) of the definition of
                           Excluded Tax.
<PAGE>   21
                                                                              18

                  2.       The Purchaser will be ultimately responsible for the
                           payment of all Contract Taxes (including, without
                           limitation, Contract Taxes that are VAT, octroi
                           duties relating to Contract items and fiscal stamps,
                           etc. connected with Contract legalizations to the
                           authorities in their countries). In the case of any
                           Contract Taxes paid by the Contractor, the Contractor
                           shall submit payment on the Purchaser's behalf and
                           Contractor will be reimbursed by the Purchaser in
                           accordance with Article 5 (Terms of Payment by
                           Purchaser).

                  3.       The Contractor agrees to use reasonable efforts,
                           including, without limitation, by registering for VAT
                           and any applicable sales Taxes in any country, state
                           or other jurisdiction where legally required, to
                           cooperate with and assist Purchaser in its efforts
                           (i) to have Supplies which are the subject of this
                           Contract made exempt from Contract Taxes, whether in
                           the manufacture of the Supplies or related to the
                           importation or location or installation of the
                           Supplies, (ii) to request revisions, drawbacks,
                           remissions, reclassifications or the like to the
                           jurisdictions identified by the Purchaser; or (iii)
                           to reduce or eliminate Contract Taxes (including the
                           provision of applicable certifications and forms) and
                           to obtain any available refunds of Contract Taxes,
                           provided that the Contractor shall not be required to
                           act other than in accordance with the relevant Laws
                           then in force. The Purchaser shall reimburse the
                           Contractor, in accordance with Article 5, for any
                           reasonable costs (including the reasonable fees and
                           expenses of legal counsel, accountants and other
                           advisors) incurred by the Contractor under this
                           Sub-Article 4(B)(3), provided that Purchaser was
                           notified and has consented to the incurrence of such
                           costs, fees and expenses. Contractor shall not be
                           required to cooperate with and assist Purchaser in
                           its efforts under this Sub-Article 4(B)(3) or to take
                           any action hereunder which in the Contractor's good
                           faith judgment would incur any costs or if in
                           Contractor's good faith judgment it would be
                           advisable to obtain the advice of counsel,
                           accountants or other advisors prior to cooperating
                           with or assisting purchaser or taking any action,
                           unless in each case, Purchaser has agreed to
                           reimburse Contractor under the foregoing proviso.

                  4.       Prior to the Date of Provisional Acceptance with
                           respect to a Phase, the System or any System Upgrade,
                           the Contractor shall provide evidence of having made
                           all payments for Taxes included in the Contract Price
                           or Upgrade Price or described in clause (iv) of the
                           definition of Excluded Taxes, other than VAT due on
                           payments of the Contract Price or Upgrade Price made
                           on or after the Date of Provisional Acceptance of the
                           System or System Upgrade, which evidence shall be
                           provided within sixty (60) days of the date of each
                           such payment.

                  5.       As part of Work or any Upgrade Work, the Contractor
                           shall obtain at its expense, on Purchaser's behalf,
                           any import license or other official
<PAGE>   22
                                                                              19

                           authorization and carry out all customs formalities
                           necessary for the importation or exportation of goods
                           in connection with such Work or Upgrade Work. With
                           respect to each Contract Country, the Purchaser
                           agrees to be the Importer or Exporter of Record or
                           designate an Importer or Exporter of Record/Consignee
                           on its behalf, unless, in either case, in the
                           Purchaser's reasonable opinion such action could
                           expose the Purchaser to a possible material burden or
                           risk, in which case Contractor or an affiliate shall
                           be the Importer or Exporter of Record; provided that
                           if Contractor or an affiliate is not legally
                           permitted by the laws of the relevant jurisdiction to
                           be Importer or Exporter of Record, Purchaser and
                           Contractor agree to discuss a mutually agreeable
                           solution. Purchaser must provide a Letter of
                           Authorization from any third party designate stating
                           it agrees to be the Importer or Exporter of Record on
                           Purchaser's behalf and identify the name and address
                           of the designated Importer or Exporter of Record.

                  6.       The Supplies to be installed or held on land shall be
                           delivered to the agreed point at the named place of
                           destination and shall be consigned to the Purchaser.

         C.       Withholding Tax

                  1.       If withholding for any Tax is required in respect of
                           any payment to the Contractor, the Purchaser shall
                           (i) withhold the appropriate amount from such
                           payment, (ii) pay such amount to the relevant
                           authorities in accordance with the applicable Laws
                           and (iii) in the case of any such withholding in
                           respect of a Contract Tax (other than any withholding
                           that would not have been required if the Contractor
                           had satisfied its other Tax payment obligations) and
                           subject to the Contractor's satisfying the
                           obligations set forth in the last sentence of this
                           Sub-Article 4(C)(1), pay the Contractor an additional
                           amount such that the net amount received by the
                           Contractor is the amount the Contractor would have
                           received in the absence of such withholding. In such
                           a case, the Purchaser shall provide to the
                           Contractor, as soon as reasonably practicable, a
                           certified copy of an official tax receipt for any Tax
                           which is retained from any payment due to the
                           Contractor or for any Tax which is paid on behalf of
                           the Contractor. All such receipts shall be in the
                           name of the Contractor. The Contractor agrees to
                           complete accurately and timely provide to the
                           Purchaser or, if required, to the applicable Taxing
                           authority, such forms, certifications or other
                           documents as may be requested in timely manner by
                           Purchaser, in order to allow it to make payments to
                           the Contractor without any deduction or withholding
                           on account of withholding Taxes (or at a reduced rate
                           thereof) or to receive a refund of any amounts
                           deducted or withheld on account of withholding Taxes.

                  2.       If the Contractor shall become aware that it is
                           entitled to receive a refund or credit from a
                           relevant taxing or governmental authority in respect
                           of a
<PAGE>   23
                                                                              20

                           Contract Tax as to which the Purchaser has paid an
                           additional amount pursuant to Sub-Article 4(C)(1)
                           above, the Contractor shall promptly notify the
                           Purchaser of the availability of such refund or
                           credit and shall, within 30 days after receipt of a
                           request by the Purchaser (whether as a result of
                           notification that it has made to the Purchaser or
                           otherwise), make a claim to such taxing or
                           governmental authority for such refund or credit at
                           the Purchaser's expense. If the Contractor receives a
                           refund or credit in respect of a Contract Tax as to
                           which the Purchaser has paid an additional amount
                           pursuant to Sub-Article 4(C)(1) above, or if, as a
                           result of the Purchaser's payment of such additional
                           amounts, the Contractor or any other member of an
                           affiliated group, as defined in section 1504(a) of
                           the Code, of which the Contractor is a member,
                           receives a credit against Taxes imposed on its income
                           or franchise taxes imposed on it by the country under
                           the laws of which it is organized or any political
                           subdivision thereof, the Contractor shall promptly
                           notify the Purchaser of such refund or credit and
                           shall within 30 days from the date of receipt of such
                           refund or benefit of such credit pay over the amount
                           of such refund or benefit of such credit (including
                           any interest paid or credited by the relevant taxing
                           or governmental authority with respect to such refund
                           or credit) to the Purchaser (but only to the extent
                           of the additional payments made by the Purchaser
                           under Sub-Article 4(C)(1) above with respect to the
                           Contract Tax giving rise to such refund or credit),
                           net of all out-of-pocket expenses of the Contractor
                           which it would not have incurred but for the
                           application of this paragraph; provided, however,
                           that the Purchaser, upon the request of the
                           Contractor agrees to repay the amount paid over to
                           the Purchaser (plus penalties, interest or other
                           charges due to the appropriate authorities in
                           connection therewith) to the Contractor in the event
                           the Contractor is required to repay such refund or
                           credit to such relevant authority.

ARTICLE 5         TERMS OF PAYMENT BY PURCHASER

         A.       General Conditions of Payment

                  1.       All payments shall be made and all invoices shall be
                           rendered in US Dollars (US$). The Purchaser shall be
                           responsible for and shall pay all costs and fees for
                           payment, as well as the banking and wiring costs. All
                           banking documents and correspondence must be in
                           English.

         B.       Invoice Procedures

                  1.       All invoices for Work shall be submitted according to
                           the Billing Schedule, provided, that the appropriate
                           Billing Milestones have been achieved. All invoices
                           for Work shall have a certificate in the form of
                           Appendix 4A attached.
<PAGE>   24
                                                                              21

                  2.       Any Contract Variations shall be invoiced and paid in
                           accordance with the terms of the Contract Variation
                           as specified in Article 6 (Contract Variations).

                  3.       Invoices for Upgrade Work shall be submitted
                           according to the Upgrade Billing Schedule and shall
                           be paid in accordance with this Article 5.

                  4.       Invoices for amounts not described in Sub-Sections 1
                           through 3 above, which may become payable hereunder,
                           shall be submitted after applicable costs have been
                           incurred or such other time as may be specified in
                           this Contract, and shall be accompanied by a
                           certificate of the Contractor explaining such amount
                           and certifying that it is payable.

                  5.       The Contractor shall render all invoices to the
                           following address or facsimile number:

                                    Asia Global Crossing Ltd.
                                    Wessex House, 2nd Floor
                                    45 Reed Street
                                    Hamilton, HM12, Bermuda
                                    Facsimile:  (441) 296-8606
                                    Telephone:  (441) 296-8600
                                    Attn:  Robert Klug

                           with a copy to the Independent Engineer.

         C.       Payment Procedures

                  1.       The Purchaser shall pay the Contractor, and the
                           Contractor shall accept payment, in accordance with
                           this Article 5 (Terms of Payment by Purchaser).
                           Purchaser agrees to pay an initial payment to
                           Contractor in the amount of     *      . Within three
                           business days of the later of the time (i) this
                           Contract is executed and delivered by all Parties and
                           (ii) the conditions set forth in Article 42 hereof
                           are fulfilled by the Parties, the first portion of
                           the initial payment, in the amount of      *       ,
                           shall be paid by Purchaser to Contractor. Failure to
                           receive this payment shall entitle Contractor, upon 5
                           business days' notice to Purchaser of intent to
                           suspend, to immediately suspend Work hereunder. The
                           second portion of the initial payment, in the amount
                           of      *      , shall be paid by Purchaser 56 days
                           after payment of the first portion of the initial
                           payment.

                  2.       Invoices given to the Purchaser (and the Independent
                           Engineer) on or before the last day of any month
                           shall, subject to Sub-Article 5(C)(5) below, be due
                           and payable on the last day of the next month or such
                           other time as may be specified in this Contract.

     *Material omitted and separately filed with the Commission under an
application for confidential treatment.
<PAGE>   25
                                                                              22

                  3.       Invoices not paid when due shall accrue late payment
                           charges from the day, following the day, on which
                           payment was due until the day on which it is paid.
                           Invoices for such late payment charges shall not be
                           issued for an amount less than U.S. $1,000. Late
                           payment charges shall be computed at the rate of one
                           percent (1%) per month calculated on a daily basis.

                  4.       In the event that the Purchaser has an objection to
                           any invoice or other payment obligation or any amount
                           owing by Contractor to Purchaser shall not have been
                           paid when due, the Purchaser shall promptly notify
                           the Contractor of such objection and such amount, and
                           the Purchaser and Contractor shall make every
                           reasonable effort to settle promptly the dispute
                           concerning the payment(s) in question. In the event
                           such dispute is not settled within ninety (90) days
                           of notification of objection, the Contractor and the
                           Purchaser will promptly execute and deliver a Payment
                           Escrow Agreement substantially in the form of Exhibit
                           E hereto, with such changes therein as the Bank
                           Escrow Agent may reasonably request, and the
                           Purchaser will have the right to withhold payment of
                           the disputed amount(s) (or withhold from the invoice
                           amount a sum equal to the amount purportedly owing by
                           Contractor) so long as it deposits, in full, such
                           disputed amount(s) into the Dispute Account.

                           (a)      Provided such disputed amount is placed into
                                    the Dispute Account in a timely manner, the
                                    Purchaser shall not be deemed to be in
                                    breach of or in default for failing to pay
                                    Contractor and the Contractor shall continue
                                    to perform all of its obligations hereunder.

                           (b)      The Bank Escrow Agent will distribute the
                                    disputed amount in accordance with the terms
                                    of the Payment Escrow Agreement.

                           (c)      In addition, the prevailing Party shall be
                                    entitled to receive from the Dispute Account
                                    an amount equal to the interest earned by
                                    the Bank Escrow Agent on the distributed,
                                    disputed amount, which shall be distributed
                                    by the Bank Escrow Agent under clause (b)
                                    above.

                           The Contractor and the Purchaser will share equally
                           the costs and expenses of the Bank Escrow Agent.

                  5.       The Purchaser shall make timely payments for that
                           portion of the invoice not in dispute in accordance
                           with Sub-Article 5(C) or such payments will be
                           assessed extended payment charges as set forth in
                           Sub-Article 5(C)(4). Pending resolution of the
                           dispute, the Purchaser may not withhold payment
                           (unless also subject to dispute) on any other invoice
                           concerning different goods and/or services submitted
                           by Contractor.
<PAGE>   26
                                                                              23

                  6.       The Retainage for the System, or any System Upgrade
                           shall be invoiced on the Date of Final Acceptance of
                           the System, or such System Upgrade, as the case may
                           be and shall be payable as set forth in Sub-Article
                           5(C)(2).

ARTICLE 6         CONTRACT VARIATIONS

         A. Either Party may request, during construction of the System or any
System Upgrade, by written order, a contract variation ("Contract Variation")
requiring additions or alterations to, deviations or deductions from the System
or System Upgrade. If the other Party consents, in its sole discretion, this
change will be formalized as an amendment to this Contract by a Contract
Variation; provided, that the Contractor will not unreasonably withhold its
consent to a Contract Variation requested by the Purchaser; and provided
further, that Purchaser will not unreasonably withhold its consent to a Contract
Variation requested by the Contractor so long as such Contract Variation does
not affect the Contract Price, any Upgrade Price, any Scheduled RFS Date, any
Scheduled Upgrade Date, any warranties or the Performance Standards.

         B. A Contract Variation shall not become effective unless and until the
price adjustment, the terms and schedule of payment and the extension of time
and all other terms have been mutually agreed upon by the Parties (and the
Parties shall act reasonably and in good faith in connection with all such
terms) and such Contract Variation is signed by an authorized representative of
each Party. Each Contract Variation shall be incorporated as an amendment to the
Contract.

         C. Contractor may seek a Contract Variation for any change, after the
date hereof, of any Law (except those, and to the extent, affecting only Taxes
or wages) which requires a change in the Work or the Upgrade Work or affects the
costs (other than wages) incurred or to be incurred by the Contractor or any
combination of the foregoing and Purchaser shall agree to any such change in
Work or Upgrade Work as may be required and to an equitable adjustment to the
Contract Price or the applicable Upgrade Price; provided, that the Contractor
shall not be entitled to any increase in the Contract Price for any change of
Law resulting from any act or omission of Contractor. As of the date hereof,
neither Party has Actual Knowledge of any proposed change in any Law that would
require a change in the Work or the Upgrade Work.

         D. The Initial Contract Price is based on the assumption that the SDH
low speed interconnect configuration shall be as set forth in the System
Description section of the Technical Volume. Purchaser may elect to change such
configuration by eliminating, replacing or adding optical interfaces and SDH
equipment each with respect to one or more Segments, where all such elections
(i.e. eliminations, replacements or additions of optical interfaces) to such
interconnect configuration shall be implemented using equipment as listed in the
Provisioning Schedule or as otherwise mutually agreed by the Parties. If
Purchaser makes any such election, both Parties shall agree to an equitable
adjustment, up or down, based on the prices set forth in the Provisioning
Schedule, to the Contract Price and/or the Scheduled RFS Date, as necessary for
each such election. The equitable adjustment shall take into account the actual
costs incurred by Contractor, including but not limited to, costs associated
with canceling firm commitments.
<PAGE>   27
                                                                              24

         E. The Initial Contract Price is based on the assumption that the land
provided by Purchaser for the Ajigaura Cable Station is adequate for the
construction of a cable station. If Contractor and Purchaser determine that such
land is not adequate for construction of a cable station, Contractor and
Purchaser agree to negotiate, in good faith, a Contract Variation, which will
provide for Contractor to acquire suitable land in the near vicinity of the
existing PC-1 cable station in Ajigaura so that such PC-1 cable station and the
proposed Ajigaura Cable Station may be appropriately connected by Contractor at
a reasonable cost. Such Contract Variation will provide for an equitable
adjustment to the Contract Price and/or the Scheduled Phase 1B RFS Date, as
necessary.

         F. The Initial Contract Price is based on the configuration set forth
in Exhibit A. Purchaser, at its option, may elect to change such configuration,
including but not limited to, for example, by eliminating any landing in
mainland China and the Qingdao Cable Station, by the Purchaser provision of the
Taean Cable Station, or by moving the Phase 1B landing site in Japan from
Ajigaura to Maruyama. If Purchaser makes any such election, both Parties shall
agree to an equitable adjustment, up or down, based on the prices set forth in
the Provisioning Schedule, to the Contract Price and/or the Scheduled RFS Date,
as necessary for each such election. The equitable adjustment shall take into
account the actual costs incurred by Contractor, including but not limited to,
costs associated with canceling firm commitments.

         G. The Initial Contract Price is based on the assumption that
conventional Forward Error Correction ("FEC"), as more fully described in the
Technical Volume, will initially be used for Phase 1A if the development of high
gain FEC ("Super FEC"), as more fully described in the Technical Volume, is not
completed in time, in the reasonable judgment of Contractor and Purchaser, to be
used for Phase 1A. Conventional FEC may also be used for up to 80Gb/s capacity
in Phase 1B, if Super FEC is not available at the time. Conventional FEC
equipment provided either in Phase 1A or Phase 1B will be replaced with Super
FEC equipment, as required to meet Performance Requirements, when such equipment
becomes available within a time frame to be mutually agreed upon by Purchaser
and Contractor. The replacement of conventional FEC with Super FEC, on Phase 1A
and/or Phase 1B if required, will be at Contractor's sole cost and expense. In
implementing Super FEC, as required, Contractor will not impair service of
existing System traffic. If necessary, Contractor, upon receiving authorization
from Purchaser, will arrange for the rerouting of traffic on a service path on
the installed System to a protection path on the installed System in order to
implement the System Upgrade so as not to incur traffic disruption. Contractor
will remove and will retain all Conventional FEC equipment that is replaced with
Super FEC.

         H. This Contract contemplates that Contractor will acquire all Access
Rights for the System (except for the land used for the Other Facilities and for
the Ajigaura Cable Station) and upon acceptance of the Segment or Phase
containing such Access Rights pursuant to Article 9 hereof, title to such Access
Rights will vest in Purchaser and risk of loss shall transfer, all in accordance
with Article 9(F) hereof. If Purchaser reasonably determines that for any reason
it is advantageous to Purchaser (for example, for tax or regulatory reasons) for
Purchaser to acquire ownership of any Access Rights (which may be as owner,
lessee or easement holder, etc.) prior to such acceptance, then Contractor shall
cause such ownership to be transferred to Purchaser rather than acquired or held
by Contractor. In each such case Contractor shall deliver an Indemnity and
<PAGE>   28
                                                                              25

Confirmation Agreement substantially in the form attached as Exhibit M hereto.
If Contractor obtains Actual Knowledge that such ownership would be advantageous
to Purchaser, Contractor will promptly so notify Purchaser.

ARTICLE 6A        OPTIONAL UPGRADES

         A. This Article includes the terms and conditions governing an option
for future upgrades to the System (each a "System Upgrade") that may be
exercised by Purchaser during the Upgrade Option Period.

         B. The option period ("Upgrade Option Period") during which Purchaser
may place orders to upgrade the System shall end   *   years after the Date of
Final Acceptance of the System and shall commence with respect to System
Upgrades on June 16, 2001; provided that Contractor will not be required to
complete a System Upgrade prior to the Date of Commercial Acceptance of the
System or Date of Provisional Acceptance of the System, whichever is earlier.

         C. Purchaser may from time to time exercise an option, during the
Upgrade Option Period, to upgrade the System, in accordance with the terms and
conditions contained in this Article, by providing notice pursuant to Article
35.

            Each System Upgrade shall consist of an incremental increase
in the System capacity in integral multiples of           *
around the ring network. Each System Upgrade shall increase the capacity of all
Segments by equal increments for service and protection capacity and shall
include all necessary spares, documentation and training attendant to such
System Upgrade. For each System Upgrade, the System capacity shall be    *
                                                        except at Taean, Korea,
where the System capacity shall be         *
                               Purchaser shall provide a separate notice
pursuant to Article 35 for each System Upgrade.

         D. While Contractor only anticipates the need for dry plant
modifications to achieve each System Upgrade, Contractor reserves the right to
replace or supplement wet plant equipment, including repeaters and cable, if
Contractor determines that such replacement or supplement is reasonably
necessary to provide a particular System Upgrade that meets the Performance
Requirements.*

         E. In implementing each System Upgrade, Contractor will not impair
service of existing System traffic. Contractor, upon receiving authorization
from Purchaser, may reroute traffic on a service path on the installed System to
a protection path on the installed System in order to implement the System
Upgrade so as not to incur traffic disruption.

         F. The performance of the System, at the end of each Upgrade Period,
shall be consistent with  *

     *Material omitted and separately filed with the Commission under an
application for confidential treatment.
<PAGE>   29
                                                                              26

         G. The System Upgrades shall be provided by Contractor at the following
fixed prices payable as set forth in the Upgrade Billing Schedule, Appendix 2A:

<TABLE>
<CAPTION>
                  Each Upgrade of System                                Fixed Initial Upgrade Price(s)
                   Capacity  *        :                                  for *
                   --------------------                                  ----------------------------
<S>                  *                                                   <C>  *

</TABLE>

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   30
<TABLE>
<CAPTION>
                  Each Upgrade of System                                Fixed Initial Upgrade Price(s)
                   Capacity of *      :                                  for *
                   --------------------                                  ----------------------------
<S>                            *                                        <C>  *

</TABLE>

         Amounts payable for System Upgrades in increments of more than  *
will be increased in accordance with the foregoing schedule. For example, if the
first System Upgrade is for    *     , the Price would be      *       . An
initial payment may be invoiced at the time a System Upgrade is ordered in the
amount of    *    of the fixed Initial Upgrade Price for such Upgrade plus, if
applicable, the additional amounts set forth below.  *   Such initial payment,
including any additional payment described above shall be part of the Initial
Upgrade Price stated above for such System Upgrade and shall not be an increase
to such System Upgrade's Initial Upgrade Price.

         H. The plan of work for any System Upgrade is included in the Upgrade
Plan of Work, Appendix 3A.

         I. The provisioning schedule for any System Upgrade is included in the
Upgrade Provisioning Schedule, Appendix 1A.

         J. Contractor shall have no obligation to perform a System Upgrade (and
no liability for failure to perform a System Upgrade) if Purchaser, its
representatives, employees or agents (other than Contractor) shall have modified
the System in such a way as to make it more difficult (unless there is an
equitable adjustment to the Upgrade Work) or more costly (unless such cost is
provided for by Purchaser) for Contractor to perform such System Upgrade,
provided that Contractor shall be relieved of its obligation to perform such
System Upgrade (and shall have no liability for failure to perform such System
Upgrade) if such modification makes it impossible for Contractor to perform such
System Upgrade.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   31
                                                                              28

         K. Contractor agrees that the installation, testing and acceptance of
each System Upgrade will occur not later than the date (the "Scheduled Upgrade
Date") which is       *         after notice in the case of a requested System
Upgrade of not more than    *    per fiber pair for all four fiber pairs and
        *        after notice in the case of a requested System Upgrade of not
more than    *     per fiber pair for all four fiber pairs. In each case, such
period shall begin upon the giving of notice pursuant to paragraph C of this
Article 6A and shall be subject to the proviso contained in Sub-Article 6A(B).
Purchaser will use reasonable efforts to try to forecast its System Upgrade
capacity requirements so as to give earlier notice of an estimated time of
upgrade to Contractor. The Parties agree that where overlapping occurs because
the Purchaser exercises an option for a System Upgrade prior to the completion
of a previously elected System Upgrade, the Parties will agree in good faith to
a mutually acceptable delivery schedule and price adjustment. Should a need for
a special upgrade (in addition to the foregoing, for example, a System Upgrade
of more than    *     ) arise, the Parties will negotiate in good faith to meet
Purchaser's needs.

         L. 1 In addition to, and apart from the other provisions of this
Article 6A, Contractor agrees that unless and until instructed otherwise by
Purchaser, Contractor will (at no cost or expense to Purchaser, except as set
forth in this Sub-Article) at all times (except during the Installation Interval
defined below) from the date the System is Ready for Provisional Acceptance
until the end of the Upgrade Option Period, cause to be substantially installed
at each cable station, sufficient equipment so as to be able to cause testing
and acceptance of the Expedited Upgrade within     *    of Purchaser's upgrade
election, sufficient equipment to provide Purchaser with a System Upgrade of 20
Gb/s of fully protected capacity  (10 Gb/s of service on each of two Fiber Pair
and 10 Gb/s of protection on each of the remaining two Fiber Pair) (an
"Expedited Upgrade"). An Expedited Upgrade will include 10 Gb/s on each Fiber
Pair, as more fully described in the Technical Volume. Upon Purchaser's Upgrade
Election, the Contractor will in good faith develop with the Purchaser a plan to
most expeditiously finish installation and test such equipment. Purchaser agrees
that it will not place such substantially installed Expedited Upgrade Equipment
into service without prior written consent of the Contractor. The fixed price
payable for each Expedited Upgrade (fully installed, tested and accepted) will
be            *              of the price of the next scheduled System Upgrade
which may be ordered for Expedited Upgrades. Notwithstanding any other provision
to the contrary contained herein, title (free and clear of all liens other than
those deriving through or from the Purchaser) and risk of loss to such Expedited
Upgrade equipment shall vest in the Purchaser when it is substantially
installed. All relevant Taxes with respect to the installation and transfer of
title to such Expedited Upgrade shall be invoiced by Contractor and paid by
Purchaser in accordance with this Contract. Such price shall be payable on a
similar basis as the System Upgrade Billing Schedule. Purchaser will accept the
Factory acceptance test report on Expedited Upgrades, but such report must show
that the equipment left the Factory working as a unit. Whenever Purchaser orders
an Expedited Upgrade, Contractor shall replace the equipment used for such
Upgrade so that it substantially installs the equipment for the next Expedited
Upgrade within           *             of testing and acceptance of the ordered
Expedited Upgrade. "Installation Interval" is any period during which Contractor
is not obligated to have Expedited Upgrade Equipment substantially installed
pursuant to this Sub-Article 6A(L)(1). Expedited Upgrades may be ordered during
the periods when Purchaser is waiting for a System Upgrade pursuant to
Sub-Article 6A(K) above. Expedited Upgrades shall be in addition to System

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   32
                                                                            29

Upgrades and shall not affect the schedule set forth in Sub-Article 6A(G) above,
except that Contractor shall not be obligated to install more than     *      of
capacity in the System. The capacity of all Expedited Upgrades installed will be
subtracted from the System Upgrade schedule in inverse order and the Price of
such reduced System Upgrades shall be adjusted accordingly based upon the prices
set forth in the Upgrade Provisioning Schedule. Expedited Upgrades shall be
considered "Upgrade Work" for all purposes of this Contract. The provisions of
Sub-Articles 6A (B), (C) (first paragraph only), (D), (E), (F) and (J) shall
apply to Expedited Upgrades. * If requested by Purchaser, at any time during the
six (6) month period immediately preceding the expiration of the Upgrade Option
Period, Contractor shall use reasonable efforts to sell (at Purchaser's cost)
any equipment for an Expedited Upgrade which has been substantially installed
but not activated, to other customers. Notwithstanding the foregoing sentence,
if, at the end of the Upgrade Option Period, equipment for an Expedited Upgrade
has been installed in accordance with this Sub-Article, but not activated,
Purchaser shall pay Contractor for such equipment in accordance with the Payment
terms of this Contract, provided that if Contractor has sold such equipment in
accordance with the foregoing sentence, the proceeds of such sale (less
Contractor's costs in connection with its efforts to sell) shall be deducted
from the price owed by Purchaser to Contractor.

                  2. The Expedited Upgrade Price and supporting equipment
availability are based on            *               being provided for
interconnectivity. With respect to any Expedited Upgrade, Purchaser may elect
(i) to exclude from such Expedited Upgrade some or all           *
                     and/or (ii) to include other            *
         . If Purchaser elects (i) and/or (ii), both Parties shall agree to
an equitable adjustment, up or down, based on the prices set forth in the
Provisioning Schedule, to the Expedited Upgrade Price and the supporting
equipment availability and an equitable adjustment in the schedule for the
Expedited Upgrade, as needed in the event Purchaser elects (ii) above.

ARTICLE 7         RESPONSIBILITIES FOR PERMITS; COMPLIANCE WITH LAWS; HONG KONG
                  CABLE STATION.

         A. Upon written request of the Contractor, the Purchaser shall
reasonably cooperate with and assist the Contractor to obtain all Permits, to
the extent that Purchaser's cooperation and assistance are necessary for
Contractor to expeditiously and cost-efficiently obtain such Permits. The
Purchaser agrees to respond reasonably promptly to any such request from
Contractor; provided, that, the failure of Purchaser to comply with such request
shall not give rise to a Purchaser Hindrance unless (i) the requested
cooperation was required by Law and (ii) Purchaser failure is due to gross
negligence or willful misconduct. Contractor shall reimburse reasonable outside
counsel fees, reasonable independent consultant fees and other reasonable
out-of-pocket expenses incurred by Purchaser in connection with such
cooperation. Further, the Purchaser agrees that it will not impede or interfere
with Contractor's abilities to perform its obligations under paragraph B of this
Article 7. Upon notice from Contractor with respect to a Permit or receipt by
Purchaser of a copy of a Permit, Purchaser shall fulfill all conditions of such
Permit

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   33
                                                                              30

and perform all responsibilities thereunder, except to the extent that such
conditions or responsibilities are those of the Contractor under the Work.
Contractor will inform Purchaser as to any such conditions or responsibilities
that are not ordinary and routine (based on industry standards) and obtain
Purchaser's consent thereto prior to arranging for any such Permit. Purchaser
(and its representatives and lawyers) may, at its sole option and expense,
participate with Contractor in the process of obtaining any Permits to the
extent it deems reasonably necessary; provided, that any such participation
shall not relieve or alter any of Contractor's obligations under this Contract
with respect to obtaining all Permits and shall not, by itself, be deemed to
impede or interfere with Contractor.

         B. Subject to paragraph C below, the Contractor shall have the
responsibility for obtaining, at the Contractor's sole cost and expense, all
Permits on Purchaser's behalf. The Contractor will cause all Permits ultimately
required to be held by Purchaser but not initially issued in the name of
Purchaser to be assignable to Purchaser, and to be assigned to Purchaser at the
time title to the System (or any Segment) is transferred to Purchaser pursuant
to this Contract. Contractor shall be responsible to pay any transfer fees in
connection with any such assignment. Subject to Sub-Article 4(A)(4), Purchaser
shall be responsible for payment of all Permit fees and other costs and expenses
due with respect to any Permit after the Date of Provisional Acceptance of the
System.

         C. The Contractor shall not be responsible for obtaining Purchaser
Permits, but the Contractor will cooperate with the Purchaser in connection
therewith. Purchaser shall reimburse reasonable outside counsel fees, reasonable
independent consultant fees and other reasonable out-of-pocket expenses incurred
by Contractor in connection with such cooperation.

         D. Any delay in obtaining or failure to obtain any Owner Permit shall
constitute a Force Majeure and be treated as described in Article 17 (Force
Majeure), except to the extent such delay is a result of Contractor's negligence
or willful misconduct. No Force Majeure shall be granted with respect to
Contractor Permits.

         E. Except with respect to variations necessitated by complying with any
changes, enacted after the date hereof, in any Laws (the costs with respect to
which shall be borne by the Purchaser unless such change is a result of any act
or omission by Contractor), the Contractor shall be responsible for the payment
of any and all costs incurred as a result of the need to vary design, drawings,
plans or procedures to comply with any of the circumstances set forth in this
Article. The Contractor shall, before making any variations from the designs,
drawings, plans or procedures that may be necessitated by so complying with any
Laws and that would represent a material change to the overall design of the
System, give to the Purchaser written notice, specifying the variations proposed
to be made, and the reasons for making them. As of the date hereof, neither
Party has Actual Knowledge of any proposed changes in the Laws which would
necessitate any such variation.

         F. The Contractor shall comply with all applicable Laws in performing
the Work, (ii) give all notices required by any Laws to be given to any
authority and (iii) perform or permit the performance by authorized persons of
any inspection required by the said Laws. All Work and the Project, upon
completion, will comply with all applicable Laws.
<PAGE>   34
                                                                              31

         G. As part of the Initial Contract Price, the Contractor shall obtain,
at its own risk and expense, any export and import license and other official
authorization and carry out all customs formalities for the exportation and
importation of goods and, where necessary, for their transit through another
country.

         H. Within 30 days after the date of execution of this Contract, the
Contractor will prepare and deliver to the Purchaser a detailed list of Permits
that to its knowledge are required to be obtained under current law in order to
complete the Work and shall update such list from time to time if it becomes
aware of changes in Permit requirements. Such list, as updated from time to
time, shall set forth the projected dates of filing for such Permits and an
estimate of when such Permits are expected to be obtained. Without limiting
Contractor's liabilities in respect of Sub-Articles 7(B), Contractor shall have
no liability in respect of the accuracy of the information furnished under this
Sub-Article, except in the case of gross negligence or willful misconduct.

         I. Upon written request of the Contractor, the Purchaser shall
reasonably cooperate with and assist the Contractor in the Contractor's
obtaining land for, and constructing, the Hong Kong Cable Station to the extent
that Purchaser's cooperation and assistance are necessary for Contractor to
obtain land for, and construct, such station in accordance with the time frame
set forth in the Plan of Work. The Purchaser agrees to respond reasonably
promptly to any such request from Contractor; provided, that the failure of
Purchaser to comply with such request shall not give rise to a Purchaser
Hindrance unless (i) the requested cooperation was required by Law and (ii)
Purchaser's failure is due to gross negligence or willful misconduct. Contractor
shall reimburse reasonable outside counsel fees, reasonable independent
consultant fees and other reasonable out-of-pocket expenses incurred by
Purchaser in connection with such cooperation. Purchaser's cooperation pursuant
to this paragraph I of Article 7 shall not relieve or alter any of Contractor's
obligations under this Contract with respect to obtaining land for, and
constructing, the Hong Cable Station, and shall not, by itself, be deemed to
impede or interfere with Contractor.

ARTICLE 8         ROUTE SURVEY

         A. The Contractor shall produce a Desk Top Study, the Route Survey and,
where prudent, a Burial Assessment Survey, and select the cable route for the
System in accordance with the information in the Final Route Survey Report and
such Burial Assessment Survey. Contractor shall be permitted to make changes, at
its discretion, to the route selection, if necessary for operational reasons,
without additional cost to Purchaser. The Contractor shall review with the
Purchaser the route for the System, and the results of the Burial Assessment
Survey, within 20 business days of the presentation of the Final Route Survey
Report, which Report must include the results of such Burial Assessment Survey.

         B. Any changes to the route selection requested by Purchaser shall be
treated as a Contract Variation in accordance with Article 6 (Contract
Variations).
<PAGE>   35
                                                                              32

         C. Any changes to any aspect of the Work due to any Desk Top Study,
Route Survey, Burial Assessment Survey or Final Route Survey Report will not
result in any change to the Initial Contract Price.

         D. The Contractor will perform the Desktop Study, Route Survey and
Burial Assessment Survey, and engineer and design the cable route, using
generally accepted practices in the industry. In the engineering and design of
the cable route the Contractor will give due consideration to the interests of
the Purchaser and shall in good faith try to satisfy such interests,
particularly (but without limitation) regarding survivability, maintainability
and tax consequences, in each case arising from the location of the cable.

ARTICLE 9         ACCEPTANCE

         A.       General

                  1.       The Acceptance Testing shall be performed by the
                           Contractor. The Purchaser and its designated
                           representatives (including the Independent Engineer)
                           may observe, at their own expense, the Contractor's
                           tests and review the test results. Purchaser may
                           request the Contractor to conduct and/or may itself
                           conduct any additional tests that are commercially
                           reasonable under the circumstances to demonstrate
                           compliance with the provisions of this Agreement and
                           the specifications in the Technical Volume. If such
                           additional tests do demonstrate that the provisions
                           of this Agreement and the specifications in the
                           Technical Volume have been complied with, then the
                           Purchaser shall be responsible for paying the costs
                           (which, for the avoidance of doubt, shall include the
                           reasonable travel and living expenses of Contractor's
                           additional personnel, if any, required by such tests)
                           of such additional tests, and any delay beyond the
                           Contractor's schedule for completion of its tests
                           caused by such process shall be a Force Majeure. If,
                           however, such additional tests demonstrate that the
                           provisions of this Agreement or the specifications in
                           the Technical Volume have not been complied with,
                           then it shall be the Contractor's responsibility to
                           pay the costs (which, for the avoidance of doubt,
                           shall include the reasonable travel and living
                           expenses of Purchaser's additional personnel, if any,
                           required by such tests) of such additional tests, and
                           any delay caused by such process shall not be a Force
                           Majeure.

                  2.       Until the Date of Final Acceptance of the System or
                           if a System Upgrade is requested by Purchaser, the
                           Date of Final Acceptance of such System Upgrade, the
                           Purchaser agrees to allow Contractor access to all
                           Segments of the System.

                  3.       The Purchaser shall issue a Certificate of Commercial
                           Acceptance in accordance with the provisions of
                           Sub-Article 9(D)(1).
<PAGE>   36
                                                                              33

                  4.       Once a Segment of the System, a Phase of the System,
                           the System, or a System Upgrade is Ready for
                           Provisional Acceptance, the Purchaser shall issue a
                           Certificate of Provisional Acceptance, provided, that
                           it is within the Purchaser's sole discretion as to
                           whether to accept a Segment.

                  5.       Once the System or a System Upgrade is Ready for
                           Final Acceptance, the Purchaser shall issue a
                           Certificate of Final Acceptance.

                  6.       The Purchaser shall not unreasonably withhold or
                           delay issuance of a Certificate of Commercial
                           Acceptance, a Certificate of Provisional Acceptance
                           or a Certificate of Final Acceptance.

                  7.       The Contractor agrees that the Date of Provisional
                           Acceptance or Commercial Acceptance of Phase 1A of
                           the System will occur by December 31, 2000 (as such
                           date may be extended under Article 6 (Contract
                           Variations), Article 17 (Force Majeure) or otherwise
                           under this Contract or by agreement of the Parties,
                           the "Scheduled Phase 1A
                           RFS Date").

                  8.       The Contractor agrees that the Date of Provisional
                           Acceptance or Commercial Acceptance of Phase 1B of
                           the System and of the System will occur by June 15,
                           2001 (as such date may be extended under Article 6
                           (Contract Variations), Article 17 (Force Majeure) or
                           otherwise under this Contract or by agreement of the
                           Parties, the "Scheduled Phase 1B RFS Date" and the
                           "Scheduled System RFS Date").

                  9.       The Date of Commercial Acceptance, Provisional
                           Acceptance and Final Acceptance, as the case may be,
                           shall be deemed to have occurred with respect to a
                           Segment, a Phase, the System or a System Upgrade if a
                           Certificate of Commercial Acceptance, a Certificate
                           of Provisional Acceptance or a Certificate of Final
                           Acceptance, as the case may be, is issued with
                           respect thereto.

         B.       Notice of Acceptance or Rejection

                  1.       Within thirty (30) days of receipt by Purchaser and
                           Independent Engineer of a complete Commissioning
                           Report or Upgrade Commissioning Report, as the case
                           may be, the Purchaser must issue notification to the
                           Contractor of the following:

                           (a)      issuance of a Certificate of Provisional
                                    Acceptance in accordance with Sub-Article
                                    9(C); or

                           (b)      rejection of a Certificate of Provisional
                                    Acceptance, but instead issuance of a
                                    Certificate of Commercial Acceptance in
                                    accordance with Sub-Article 9(D) below; or
<PAGE>   37
                                                                              34

                           (c)      rejection of the Segment, the Phase, the
                                    System or the System Upgrade in its existing
                                    condition and issuance of neither a
                                    Certificate of Provisional Acceptance nor a
                                    Certificate of Commercial Acceptance, and in
                                    the case of the System or the System
                                    Upgrade, a written explanation of reasons
                                    for rejection (it being understood that
                                    acceptance of a Segment is at the sole
                                    discretion of the Purchaser).

                           If the Purchaser (or the Independent Engineer on its
                           behalf) fails to respond with such notification
                           within thirty (30) days, then the Date of Provisional
                           Acceptance of the Segment (subject to Purchaser's
                           consent), the Phase, the System or System Upgrade
                           shall be deemed to be the date occurring thirty (30)
                           days after such Commissioning Report or Upgrade
                           Commissioning Report, as the case may be, was
                           received by the Purchaser.

                  2.       On receipt of a notice from the Purchaser pursuant to
                           Sub-Articles 9(B)(1)(b) or (c) above, the Contractor
                           shall be entitled to address any disputes and explain
                           any discrepancies to the Purchaser. Unless Purchaser,
                           for good cause, rejects such explanation, it shall
                           issue a new notice pursuant to Sub-Article 9(B)(1)
                           above, which shall be deemed to have been issued on
                           the date of the original notice.

                  3.       In case of rejection, and if the explanation by the
                           Contractor as in Sub-Article 9(B)(2) above is not
                           accepted, for good cause, by the Purchaser, the
                           Contractor shall carry out the necessary corrective
                           actions and will effect a new series of Acceptance
                           Testing ("Retesting"). After receipt by Purchaser and
                           Independent Engineer of the new Commissioning Report
                           or Upgrade Commissioning Report, as the case may be,
                           describing the corrective action and the results of
                           Retesting, the Purchaser will be granted a new period
                           of thirty (30) days to analyze the new Report
                           according to the provisions of Sub-Article 9(B)(1)
                           and any new notice of the Purchaser shall apply from
                           the date the Purchaser receives such new
                           Commissioning Report or Upgrade Commissioning Report,
                           as the case may be.

         C.       Provisional Acceptance

                  1.       The Certificate of Provisional Acceptance may have
                           annexed to it a list of any outstanding deficiencies
                           to be corrected by the Contractor.

                  2.       The Contractor shall, as soon as reasonably
                           practicable, correct, at its sole cost and expense,
                           such deficiencies and complete the Work or Upgrade
                           Work indicated on all such listed items so as to
                           comply in all material respects with the requirements
                           of this Contract, provided that the Purchaser allows
                           Contractor the necessary access to the Segment(s) as
                           the
<PAGE>   38
                                                                              35

                           Contractor needs to correct such deficiencies and
                           complete the Work or Upgrade Work. The Contractor
                           shall give the Purchaser reasonable notice of its
                           requirement for such access.

         D.       Commercial Acceptance

                  1.       A Certificate of Commercial Acceptance shall be
                           issued by Purchaser with respect to a Segment, a
                           Phase, the System or a System Upgrade if the results
                           of the Acceptance Testing demonstrate that such
                           Segment, such Phase, the System or such System
                           Upgrade does not justify the issuance of a
                           Certificate of Provisional Acceptance, but
                           nevertheless, such Segment, such Phase, the System or
                           such System Upgrade is Ready for Commercial
                           Acceptance; provided, that acceptance of a Segment
                           shall be in the sole discretion of the Purchaser.

                  2.       Each Certificate of Commercial Acceptance shall have
                           annexed to it a list of all outstanding items to be
                           completed by the Contractor.

                  3.       The Contractor shall, as soon as reasonably
                           practicable, remedy, at its sole cost and expense,
                           the outstanding items, provided that the Purchaser
                           allows Contractor the necessary access to the
                           Segment(s) as the Contractor needs to remedy such
                           outstanding items. The Contractor shall give the
                           Purchaser reasonable notice of its requirement for
                           such access. Notwithstanding the above, provided that
                           Contractor has been allowed access to the Segment(s)
                           as required in Sub-Article 9(A)(2), the Contractor
                           shall continue to carry the risk of loss for any
                           outstanding item until such item is no longer
                           outstanding.

                  4.       When the outstanding items referenced in Sub-Article
                           9(D)(3) above have been remedied, and the Segment(s),
                           the Phase, the System or the System Upgrade is
                           otherwise Ready for Provisional Acceptance, the
                           Purchaser will promptly issue a Certificate of
                           Provisional Acceptance; provided, that acceptance of
                           a Segment shall be in the sole discretion of the
                           Purchaser.

                  5.       The issuance of a Certificate of Commercial
                           Acceptance with respect to a Segment, a Phase, the
                           System or a System Upgrade shall in no way relieve
                           the Contractor from its obligation to provide a
                           Segment, a Phase, the System or System Upgrade
                           conforming with the Performance Requirements at the
                           time of the issuance of a Certificate of Commercial
                           Acceptance.

         E.       Final Acceptance

                  1.       Within thirty (30) days of the date of receipt by
                           Purchaser and Independent Engineer of the Final
                           Commissioning Report or Final Upgrade Commissioning
                           Report, as the case may be, the Purchaser shall issue
                           a
<PAGE>   39
                                                                              36

                           Certificate of Final Acceptance or reject such
                           Report. If the Purchaser neither issues a Certificate
                           of Final Acceptance nor rejects such Report within
                           such thirty (30) day period, then the Date of Final
                           Acceptance of the System or the System Upgrade shall
                           be deemed to be the date occurring thirty (30) days
                           after such Final Commissioning Report or Final
                           Upgrade Commissioning Report, as the case may be, was
                           received by the Purchaser.

         F.       Title and Risk of Loss

                  1.       If the Purchaser, in its sole discretion, chooses to
                           accept a Segment prior to accepting a Phase or the
                           System, then upon the issuance of a Certificate of
                           Commercial Acceptance or a Certificate of Provisional
                           Acceptance with respect to such Segment by the
                           Purchaser in accordance with this Contract, title
                           (free and clear of all liens other than those
                           deriving through or from the Purchaser) to such
                           Segment shall vest in the Purchaser. A statement of
                           the time of passage of title in such Certificate
                           shall be final and conclusive.

                  2.       Upon the issuance of a Certificate of Commercial
                           Acceptance or a Certificate of Provisional Acceptance
                           with respect to a Phase or the System by the
                           Purchaser in accordance with this Contract, title
                           (free and clear of all liens other than those
                           deriving through or from the Purchaser) to such Phase
                           or the System shall vest in the Purchaser. A
                           statement of the time of passage of title in such
                           Certificate shall be final and conclusive.

                  3.       Upon the issuance of a Certificate of Commercial
                           Acceptance or a Certificate of Provisional Acceptance
                           with respect to a System Upgrade by the Purchaser in
                           accordance with this Contract, title to such System
                           Upgrade shall vest in the Purchaser. A statement of
                           the time of passage of title in such Certificate
                           shall be final and conclusive.

                  4.       As from the date of vesting of title in a Segment, a
                           Phase, the System or a System Upgrade, the Purchaser
                           shall, except as set forth in the following sentence,
                           assume the risk of loss in respect of all parts of
                           such Segment, such Phase, the System or System
                           Upgrade and responsibility for its maintenance. As
                           stated in Sub-Article 9(A)(2), the Contractor will be
                           allowed access to such Segment(s), and, so long as
                           the Contractor has been allowed access to such
                           Segment(s) as may be required, the Contractor shall
                           continue to carry the risk of loss with respect of
                           each item outstanding under Sub-Article 9(C)(1) and
                           9(D)(2) until such item is no longer outstanding.

ARTICLE 10        WARRANTY

         A. The Contractor warrants that the System and each System Upgrade,
including its spares, shall be free from defects in supplies, workmanship and
design for a period of five (5) years

<PAGE>   40
                                                                              37

      from the Date of Provisional Acceptance of the System or such System
Upgrade, as the case may be, (hereinafter "Warranty Period" and "Upgrade
Warranty Period"), with Ship Costs being covered for the first two (2) years of
the Warranty Period (the "Ship Period") and the Purchaser being responsible for
all Ship Costs thereafter; provided, that (i) if the Scheduled System RFS Date
is extended because of a Purchaser Hindrance or because of an affirmative
decision by the Purchaser to extend such RFS Date, the Warranty Period and the
Ship Period with respect to Phase 1A shall terminate on the date that is five
(5) years and two (2) years, respectively, after the Scheduled System RFS Date
(without giving effect to extensions because of a Purchaser Hindrance or because
of an affirmative decision by Purchaser to extend such RFS Date) and (ii) if the
construction of Phase 1B is terminated by the Purchaser for its convenience,
such that Phase 1A becomes the entire System, the Warranty Period and the Ship
Period with respect to Phase 1A shall terminate on the date that is five (5)
years and two (2) years, respectively, after the Scheduled Phase 1A RFS Date
(for purposes of this Article 10, "Adjusted Date of System Provisional
Acceptance").

                  1.       During the Warranty Period for the System or the
                           Upgrade Warranty Period for a System Upgrade, the
                           Contractor shall make good, by repair or replacement,
                           at its sole option, any defects in the System or such
                           System Upgrade, as the case may be, including any
                           spares, which may become apparent or be discovered
                           due to imperfect workmanship, faulty design or faulty
                           material supplied by the Contractor, or any act,
                           neglect or omission on the Contractor's part.

                           (a)      If at any time within the Warranty Period or
                                    the Upgrade Warranty Period for a System
                                    Upgrade any defect occurs which causes the
                                    System or such System Upgrade, as the case
                                    may be, to fail to meet its overall
                                    Performance Requirements, the Contractor
                                    shall repair or replace such part or parts.
                                    In making such repairs, Contractor may make
                                    changes to the System or such System
                                    Upgrade, as the case may be, or substitute
                                    equipment of later or comparable design,
                                    provided the changes, modifications, or
                                    substitutions under normal and proper use do
                                    not cause the System or such System Upgrade
                                    as the case may be to fail to meet the
                                    Performance Requirements.

                           (b)      The Contractor shall use reasonable efforts
                                    to minimize the period of time that any
                                    Segment or the System is out of service for
                                    testing and repair. The Purchaser agrees to
                                    cooperate with the Contractor to facilitate
                                    the Contractor's repair activity.

                           (c)      It is understood that if there is a problem
                                    on the System, the Purchaser may immediately
                                    dispatch the maintenance authority to effect
                                    repairs. If and to the extent that such
                                    problem is determined to be caused by a
                                    defect in the System covered by this
                                    warranty, the Contractor shall reimburse the
                                    Purchaser for its actual Non-Ship Costs
                                    incurred and, with respect to any such
                                    repair relating to a defect identified in
                                    good faith by Purchaser in writing prior to
                                    the

<PAGE>   41
                                                                              38

                                    end of the Ship Period, actual Ship Costs
                                    incurred. If the Purchaser has entered into
                                    arrangements whereby maintenance is all or
                                    partially covered by a "lump sum" payment
                                    covering a specific period (e.g., an annual
                                    fixed fee operations and maintenance
                                    contract), then Contractor understands that
                                    Purchaser may not actually incur costs with
                                    respect to any particular warranty repair.
                                    In such a case, Contractor agrees that the
                                    Purchaser is still entitled to a payment
                                    from Contractor in connection with such
                                    warranty repair. The Contractor and
                                    Purchaser will agree in good faith to an
                                    equitable method of determining the industry
                                    standard typical costs for such a repair
                                    based upon what the repair would have
                                    actually cost had it been paid under a
                                    specific maintenance agreement and such
                                    typical costs shall be reimbursed to
                                    Purchaser.

                                    (i)     The Contractor shall be given
                                            advance notice and be entitled to
                                            have a representative on board ship
                                            to observe at sea repairs and shall
                                            be given the earliest possible
                                            notice of any such repair.

                                    (ii)    Subject to the foregoing and to
                                            Sub-Article 10(D), any repair by the
                                            Purchaser shall not in any way
                                            diminish the Contractor's obligation
                                            under the warranty. Any equipment
                                            discovered to be defective or faulty
                                            and recovered during a warranty
                                            repair shall be returned to the
                                            Contractor at its request.

                           (d)      In the event that the Contractor fails to
                                    make the repair or to make reasonable
                                    efforts to minimize the period of time that
                                    the System is out of service for repair, the
                                    Purchaser may repair the System or the
                                    System Upgrade and the Contractor shall
                                    reimburse the Purchaser for Non-Ship Costs
                                    and, with respect to any such repair
                                    relating to a defect identified in good
                                    faith by Purchaser in writing prior to the
                                    end of the Ship Period, Ship Costs.

                                    (i)     The Contractor shall be given
                                            advance notice and be entitled to
                                            have a representative on board ship
                                            to observe at sea repairs and shall
                                            be given the earliest possible
                                            notice of any such repair.

                                    (ii)    Subject to the foregoing, any repair
                                            by the Purchaser shall not in any
                                            way diminish the Contractor's
                                            obligation under the warranty. Any
                                            equipment discovered to be defective
                                            or faulty and recovered during a
                                            warranty repair shall be returned to
                                            the Contractor at its request.
<PAGE>   42
                                                                              39

            2.    Contractor shall bear the Ship Costs of only those repairs of
                  the defects identified in good faith by Purchaser in writing
                  prior to the end of the Ship Period. However, the Contractor
                  shall bear the Non-Ship Costs of each repair, replacement or
                  improvement required during the Warranty Period.

                  As used herein, "Ship Cost" means the costs of operating a
                  vessel, including but not limited to running and standing
                  charges for the vessel (including but not limited to labor
                  charges for the vessel's crew, at sea insurance, port charges,
                  fuel and lube oils, consumables, cable loading, cable
                  unloading, navigation and maritime communications) as well as
                  the costs associated with the use and operation of a remotely
                  operated vehicle and the tracked self propelled burial tool
                  and "Non-Ship Costs" means the costs of making a repair,
                  including the cost of components, equipment or materials
                  requiring replacement, the cost of any additional equipment
                  necessary to effect the repair, the cost of making the repair,
                  including the cost of reburying any previously buried portion,
                  the cost of labor and engineering assistance or development
                  required to make the repair and all necessary associated
                  costs, such as, but not limited to, shipping and customs and
                  services that may be required to make the repair, but
                  excluding any of the foregoing which are Ship Costs.

            3.    The Contractor shall effect all warranty repairs of the System
                  and shall supply all necessary repair materials. However, the
                  Contractor may use, with the consent of the Purchaser, which
                  shall not be unreasonably withheld, the materials needed to
                  effect a repair from the Purchaser's available spare
                  materials. The Contractor shall promptly replace in kind such
                  materials supplied from the Purchaser's spare materials or at
                  the option of the Purchaser, reimburse the Purchaser for such
                  materials at its original purchase price. The replacement of
                  or reimbursement for such materials shall be made at a time
                  mutually agreed to by the Purchaser and the Contractor.

            4.    The Contractor warrants that services furnished hereunder will
                  be performed in a workmanlike manner using materials free from
                  defects except when such materials are provided by the
                  Purchaser (it being understood that all materials arranged for
                  directly by Contractor, whether or not purchased in the name
                  of Purchaser, are not materials provided by the Purchaser). If
                  such services prove to be not so performed and Purchaser
                  notifies the Contractor within six (6) months from the
                  completion of the service or before the end of the Warranty
                  Period, whichever is later, the Contractor will promptly
                  correct the defect.

            5.    Any part which replaces a defective part during the applicable
                  Warranty Period or Upgrade Warranty Period, shall be covered
                  by these warranties for the remaining Warranty Period and Ship
                  Period, if any, or Upgrade Warranty Period, as the case may
                  be, of the part which was replaced or, if
<PAGE>   43
                                                                              40

                  longer, six months from the date of replacement. The foregoing
                  is not meant to limit any separate warranty that may apply to
                  the replacement part. However, the Warranty Period shall never
                  exceed five (5) years from the Date of Provisional Acceptance
                  of the System and the Upgrade Warranty Period for any System
                  Upgrade shall never exceed five (5) years from the Date of
                  Provisional Acceptance of such System Upgrade, in each such
                  Warranty Period, such Date of Provisional Acceptance shall be
                  defined to include the first proviso contained in Sub-Article
                  10(A). Further, Ship Costs shall be included only with respect
                  to defects identified by Purchaser in writing during the first
                  two (2) years from the Date of Provisional Acceptance of the
                  System or Adjusted Date of System Provisional Acceptance, as
                  the case may be, and shall be included with respect to such
                  defect until it is repaired.

      B. The Contractor represents and warrants that the Design Life of the
System is twenty-five (25) years. The Contractor warrants that (i) the System
shall be designed so that during the Design Life Period no pattern of failure
shall develop that causes the System (as upgraded from time to time by System
Upgrades) to fail to meet its reliability as set forth in the System Performance
Requirements (as upgraded from time to time by System Upgrades) over the Design
Life Period and (ii) the System shall be designed with sufficient transmission
margin to be upgradable to a capacity of 640 Gb/s per fiber pair. Contractor
shall have no liability with respect to the design warranty set forth in clause
(ii) of this Sub-Article unless and until Contractor shall have failed to
perform a System Upgrade requested by Purchaser. The Design Life Period shall
run for twenty-five (25) years from the Date of Provisional Acceptance of the
System (whether or not any System Upgrades are done). In the event the System is
not so designed as provided in the first two sentences of this Sub-Article,
Contractor shall effect such reengineering and redesign and make such repairs or
replace such parts as may be necessary to correct such deficiency. The
Contractor shall bear the costs of all repairs and parts and of the
reengineering and redesign necessary to effect such repairs and replacements and
the Ship Costs incurred in connection with such repairs and replacements. The
Contractor warrants that all Supplies, Deliverable Software and Deliverable
Technical Materials are Year 2000 Compliant.

      C. The warranties provided above in Sub-Articles 10(A) and (B) by the
Contractor shall not apply to defects or failures of performance, which result
from damage caused by acts or omissions of the Purchaser or its agents,
employees or representatives or third parties (other than the Contractor or its
Subcontractors), or which result from modifications, misuse, neglect, accident
or abuse, repair, storage or maintenance by other than the Contractor or its
Subcontractors or, use in a manner not in accordance with the System Description
or other causes set forth in Article 17 (Force Majeure).

      D. THE FOREGOING WARRANTY IS EXCLUSIVE AND IS IN LIEU OF ALL OTHER EXPRESS
AND IMPLIED WARRANTIES INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WHICH ARE SPECIFICALLY
DISCLAIMED.

<PAGE>   44
                                                                              41

      E. The Contractor shall, in accordance with its normal operating
practices, investigate any defective part or parts repaired or replaced pursuant
to this Article 10 to determine the type of defect and the cause of failure of
the part or parts. The Contractor shall provide a written report to the
Purchaser on the results of the investigation, if any.

      F. The Contractor agrees that the foregoing provisions of this Article 10
may be enforced, on behalf of Purchaser, by the entity or entities performing
operation, administration or maintenance services for the System.

ARTICLE 11  CONTRACTOR SUPPORT; USE OF SEGMENT FOR RESTORATION PROTECTION

      A. For a period of ten (10) years from the applicable Date of Provisional
Acceptance or Date of Commercial Acceptance of the System whichever is earlier,
the Contractor will make available to the Purchaser replacement parts and repair
service for the System as may be reasonably necessary for its operation,
maintenance or repair. Where identical parts cannot be supplied, the Contractor
shall provide fully compatible parts with characteristics equal or superior to
those originally provided by the Contractor. Such parts and services shall be
provided under commercially reasonable conditions of price and delivery.

      B. Notwithstanding Sub-Article 11(A), if for any reason the Contractor or
Contractor's suppliers intend to cease or ceases manufacturing or having
manufactured identical or fully compatible replacement parts, the Contractor
shall use reasonable efforts to give one year's prior written notice to the
Purchaser to allow the Purchaser to order from the Contractor any required
replacement parts and shall provide full details of the arrangements to provide
equivalents.

      C. Once the Purchaser has accepted a Segment of the System, the Purchaser
shall be entitled to use, without charge, any other unaccepted Segment or
Segments of the System solely for purposes of instituting restoration protection
in the System (a "Restoration Segment"); provided that:

            1.    Contractor shall be relieved from its obligations pursuant to
                  Article 22, to pay liquidated damages with respect to any
                  Restoration Segment for any delays in the Contractor's Work
                  directly resulting from, and only to the extent of,
                  Purchaser's usage of such Restoration Segment or Segments for
                  restoration protection purposes;

            2.    Contractor shall be compensated for any payment milestones
                  delayed or made unachievable arising out of or as a result of
                  Purchaser's use of such Restoration Segment or Segments for
                  restoration protection purposes; and

            3.    Purchaser shall be responsible for all maintenance costs that
                  would not have been incurred but for Purchaser's use of such
                  Restoration Segment or Segments for restoration protection
                  purposes.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   45
                                                                              42

            The Purchaser's use of any unaccepted Segment or Segments for
restoration protection purposes shall in no way obligate the Purchaser to accept
such other Segment or Segments, nor shall it be deemed to constitute an
acceptance by the Purchaser of any such other Segment or Segments, and the title
and any risk of loss associated with any such other Segment or Segments shall
remain with the Contractor.

ARTICLE 12  PURCHASER'S OBLIGATIONS

      A. If the Purchaser's failure to perform any of its express obligations
under this Contract directly results in an increase in the costs of performance
or the time required for performance of any of the Contractor's duties or
obligations under this Contract, such failure shall be deemed a "Purchaser
Hindrance." In the event of a Purchaser Hindrance, the Contractor shall be
entitled, as appropriate, to (i) an equitable extension of time for completion
of its Work or the Upgrade Work if the Purchaser Hindrance meets the
requirements for a Force Majeure delay, (ii) reimbursement for all such
additional costs incurred, and (iii) to the extent necessary in light of
Purchaser's failure and the adjustments made in accordance with clauses (i) and
(ii) above, an equitable adjustment of the Work and/or Upgrade Work. The
Contractor shall not be entitled to any other right or remedy with respect to a
Purchaser Hindrance.

            1.    The Contractor's remedies described in clauses (i), (ii) and
                  (iii) above are conditioned upon the Contractor informing the
                  Purchaser promptly of any potential Purchaser Hindrance, and
                  using reasonable efforts to minimize any such additional costs
                  or delay.

            2.    The Contractor shall promptly provide to the Purchaser an
                  estimate of the anticipated additional costs and time required
                  to complete the Work or Upgrade Work and request relief from
                  contractual obligations or duties, as appropriate. Purchaser
                  shall, upon notification, make advance payment to Contractor
                  for the estimated amount of anticipated additional costs;
                  provided that Purchaser may deposit such amount into the
                  Dispute Account and Sub-Article 5(C)(4) shall apply.
                  Contractor shall without limiting Purchaser's obligations in
                  the foregoing sentence, discuss such costs with Purchaser upon
                  Purchaser's request.

            3.    As soon as reasonably practicable after the actual costs
                  become known to the Contractor, the Contractor shall provide a
                  statement of such actual costs to the Purchaser.

            4.    If the estimated amount is greater than the amount of actual
                  costs, then the Contractor shall reimburse the Purchaser. If
                  the amount of actual costs incurred is greater than the
                  estimated amount, then the Purchaser shall reimburse the
                  Contractor for any shortfall in accordance with Article 5
                  (Terms of Payment of Purchaser).
<PAGE>   46
                                                                              43

ARTICLE 13  TERMINATION FOR DEFAULT

      A. Either Party may, by written Notice of Termination for Default,
effective fifteen (15) days after receipt or such later date as specified in the
notice, terminate the whole or any part of this Contract if any one of the
following circumstances continues after such notice (each an "Event of
Default"):

            1.    In the case of the Purchaser, (a) if Contractor fails to
                  comply in any material respect with any of the terms and
                  conditions of this Contract and such failure shall continue
                  for thirty (30) days after written notice from Purchaser to
                  Contractor specifying the failure and demanding that the same
                  be remedied; provided that, if such default cannot be
                  reasonably corrected within such thirty (30) day period, an
                  Event of Default with respect to Contractor shall not be
                  deemed to occur until the expiration of such further period,
                  not to exceed ninety (90) days, as reasonably required to
                  correct such failure, if the Contractor commences, within such
                  thirty (30) day period, and continues diligently at all times
                  thereafter, to take reasonable steps to correct the failure as
                  soon as possible, or (b) any representation or warranty made
                  by Contractor herein or in any certificate, statement or
                  document given pursuant to the terms hereof shall prove to be
                  false, incorrect or misleading in any material respect as of
                  the date on which it was made and any material adverse
                  consequences to Purchaser caused thereby shall not have been
                  remedied within thirty (30) days after written notice thereof
                  shall have been given to Contractor by Purchaser; or (c) the
                  Contractor fails to cause the System to be Ready for
                  Provisional Acceptance within 200 days after the Scheduled
                  System RFS Date;

            2.    If the other Party defaults on any of its payment obligations
                  and does not cure such default within a period of thirty (30)
                  days (or such longer period as the non-breaching Party may
                  authorize in writing) after receipt of written notice
                  demanding cure (subject to dispute provisions);

            3.    If the other Party shall commence a voluntary case or other
                  proceeding seeking liquidation, reorganization or other relief
                  with respect to itself or its debts under any bankruptcy,
                  insolvency or other similar law now or hereafter in effect or
                  seeking the appointment of a trustee, receiver, liquidator,
                  custodian or other similar official of it or any substantial
                  part of its property, or shall consent to any such relief or
                  to the appointment of or taking possession by any such
                  official in an involuntary case or other proceeding commenced
                  against it, or shall make a general assignment for the benefit
                  of creditors, or shall fail generally to pay its debts as they
                  become due, or shall take any corporate action to authorize
                  any of the foregoing;

            4.    If an involuntary case or other proceeding shall be commenced
                  against the other Party seeking liquidation, reorganization or
                  other relief with respect
<PAGE>   47
                                                                              44

                  to it or its debts under any bankruptcy, insolvency or other
                  similar law now or hereafter in effect or seeking the
                  appointment of a trustee, receiver, liquidator, custodian or
                  other similar official of it or any substantial part of its
                  property, and such involuntary case or other proceeding shall
                  remain undismissed and unstayed for a period of 60 days; or an
                  order for relief shall be entered against the other Party;

            5.    The Guaranty shall for any reason cease to be in full force
                  and effect or the Guarantor shall repudiate any of its
                  obligations thereunder.

      B. If this Contract is terminated by the Purchaser as provided in
Sub-Article 13(A), the Purchaser, in addition to any other rights provided in
this Article, and upon payment to Contractor of all monies due and owing as set
forth in Sub-Article 13(C) below, may require the Contractor to transfer title
and deliver to the Purchaser in the manner and to the extent directed by the
Purchaser any completed equipment, material or supplies, and such partially
completed cable and materials, parts, tools, dies, jigs, fixtures, plans,
drawings, information, and contract rights (hereinafter collectively
"Manufacturing Materials") as the Contractor has had specifically produced or
specifically acquired for the performance of such part of this Contract as has
been terminated and which, if this Contract had been completed, would have been
required to be furnished to the Purchaser; and the Contractor shall, upon the
direction of the Purchaser, protect and preserve property in the Contractor's
possession in which the Purchaser has an interest.

      C. If the Contract is terminated by Contractor as provided in Sub-Article
13(A), the Purchaser shall pay, in addition to any other damages payable
pursuant to Sub-Article 13(E) below, the total of:

            1.    the cost of settling and paying claims arising out of the
                  termination of Work under the contracts and orders, as
                  provided in Sub-Article 14(B)(3) below which are properly
                  chargeable to the terminated portion of this Contract; and

            2.    the reasonable costs of settlement including accounting,
                  legal, clerical and other expenses necessary for the
                  preparation of settlement claims and supporting data with
                  respect to the terminated portion of this Contract and for
                  termination and settlement of contracts thereunder, together
                  with reasonable storage, transportation and other costs
                  incurred in connection with the protection, preservation and
                  disposition of property proper to this Contract.

      D. Force Majeure or Purchaser Hindrance events shall not constitute a
default or provide a basis for termination under this Article.

      E. Regardless of any termination of this Contract as provided in
Sub-Article 13(A), neither Party shall be relieved from any liability for
damages or otherwise which may have been incurred by reason of any breach of
this Contract.
<PAGE>   48
                                                                              45

      F. Without limitation to the foregoing, in the event that Purchaser
terminates this Contract pursuant to Sub-Article 13(A), the Contractor shall be
liable to Purchaser (without duplication) for the total of all costs and
expenses reasonably incurred by Purchaser in completing the Work or in
correcting deficiencies in the Work to the extent that the payments made to
Contractor pursuant to this Contract, together with such costs and expenses,
exceed the Contract Price.

ARTICLE 14  TERMINATION FOR CONVENIENCE

      A. The performance of Work under this Contract may be terminated by the
Purchaser in whole, or in part, at its discretion. The Purchaser shall deliver
to the Contractor a written notice specifying the extent to which performance of
Work under this Contract is terminated, and the date upon which such termination
becomes effective (a "Notice of Termination"). Upon termination, the Purchaser
will make payment to Contractor of all monies due and owing as set forth in
Sub-Article 14(D) below.

      B. After receipt of such Notice of Termination, and except as otherwise
directed by the Purchaser, the Contractor shall:

            1.    Stop Work under this Contract on the date and to the extent
                  specified in the Notice of Termination;

            2.    Place no further orders or contracts for materials, services
                  or facilities except as may be necessary for completion of
                  such portion of Work under this Contract as is not terminated;

            3.    Use reasonable efforts to terminate all orders and contracts
                  to the extent that they relate to the performance of Work
                  terminated by the Notice of Termination;

            4.    Assign to the Purchaser, in the manner, at the time, and to
                  the extent directed by the Purchaser, all of the Contractor's
                  rights, title and interest under the orders and contracts so
                  terminated;

            5.    Use reasonable efforts to settle all outstanding liabilities
                  and all claims arising out of such termination of orders and
                  contracts, with the Purchaser's approval or ratification to
                  the extent required;

            6.    Transfer title and deliver to the Purchaser in the manner, at
                  the time and to the extent (if any) directed for the
                  fabricated or unfabricated parts, work in process, completed
                  work, supplies and other material produced as a part of, or
                  acquired in connection with, the performance of the Work
                  terminated by the Notice of Termination;

            7.    Use reasonable efforts to sell, in the manner, at the time, to
                  the extent and at the price or prices directed or authorized
                  by the Purchaser, any property
<PAGE>   49
                                                                              46

                  of the types referred to in Sub-Article 14(B)(6) above
                  provided, however, that the Contractor:

                  (a)   shall not be required to extend credit to any buyer; and

                  (b)   may acquire any such property under the conditions
                        prescribed by and at a price approved by the Purchaser;

                  and provided further that the net proceeds of any such
                  transfer or disposition shall be applied in reduction of any
                  payments to be made by the Purchaser to the Contractor under
                  this Contract or, if no such payments are due, paid in such
                  other manner as the Purchaser may direct;

            8.    Complete performance of such part of the Work which was not
                  terminated by the Notice of Termination; and

            9.    Take such action as may be necessary, or as the Purchaser may
                  reasonably direct, for the protection and preservation of the
                  property related to this Contract which is in the Contractor's
                  possession and in which the Purchaser has acquired or may
                  acquire an interest.

      C. After such Notice of Termination, the Contractor shall submit to the
Purchaser a written termination claim. Such claim shall be submitted promptly,
but, unless otherwise extended, in no event later than six months from the
effective date of termination.

      D. In the settlement of any such partial or total termination claim, the
Purchaser shall pay to the Contractor the total of:

            1.    all amounts invoiced in accordance with the Contract plus, for
                  Work or Supplies which have been done, provided or are in
                  progress, but which have not been invoiced, an amount
                  calculated by reference to the prices set forth in the
                  Provisioning Schedule and to the amount of such Work or
                  Supplies done or provided;

            2.    the cost of settling and paying claims arising out of the
                  termination of Work under the contracts in orders, as provided
                  in Sub-Article 14(D)(3) below which are properly chargeable to
                  the terminated portion of this Contract; and

            3.    the reasonable costs of settlement including accounting,
                  legal, clerical and other expenses necessary for the
                  preparation of settlement claims and supporting data with
                  respect to the terminated portion of this Contract and for
                  termination and settlement of contracts thereunder, together
                  with reasonable storage, transportation and other costs
                  incurred in connection with the protection and disposition of
                  property proper to this Contract.
<PAGE>   50
                                                                              47

      E. In arriving at the amount due to the Contractor under this Article 14,
all unliquidated payments made to the Contractor, any liability which the
Contractor may have to the Purchaser, and the agreed price for, or the proceeds
of sale of any materials, supplies or other things acquired by the Contractor or
sold, pursuant to the provisions of this Article 14, and not otherwise recovered
by or credited to the Purchaser shall be deducted.

      F. The Purchaser may, from time to time, under such terms and conditions
as they prescribe approve partial payments and payments on account against costs
incurred by the Contractor in connection with the terminated portion of this
Contract. If such payments total in excess of the amount finally agreed or
determined to be due under this Article 14, such excess shall be refunded, upon
demand, by the Contractor to the Purchaser.

      G. For a period of one year after final settlement under this Contract,
the Contractor shall preserve and make available to the Purchaser at reasonable
times at the Contractor's office, but without direct charge to the Purchaser,
all supporting books, records and documents required to be kept relating to the
terminated Work.

ARTICLE 15  SUSPENSION

      A. The Purchaser may, at its convenience, order the Contractor to suspend
all or part of the Work for such period of time as the Purchaser determines to
be appropriate. If, as a result of such Suspension, the Contractor incurs
additional costs or losses in the discharge of its responsibilities under this
Contract, and where such suspension, losses or costs are not caused by the
Contractor's act or omission and could not have been reasonably prevented by the
Contractor, the Contractor shall be allowed an equitable adjustment to the
Contract Price or the Provisioning Schedule in Appendix 1 and an equitable
extension in the time required for performance.

      B. Upon the occurrence of:

            (i) an Event of Default by the Purchaser;

            (ii) any transfer prior to the Date of Final Acceptance of any
      portion of the System except in accordance with Article 37; or

            (iii) any supplement executed by a Transferee shall not be in full
      force and effect;

the Contractor, in addition to any other rights provided in Article 14, may
suspend performance of its obligations and all Work and (in the case of clause
(i)) Upgrade Work.

      C. Every forty-five (45) days, during the period of Suspension, the
Parties shall meet formally and review the circumstances surrounding the
Suspension including without limitation, the anticipated date of re-commencing
Work.

      D. Thereafter, if the Suspension continues for a total of one hundred and
eighty (180) days, the Contractor may terminate the Contract by notice to the
Purchaser and the Contract shall
<PAGE>   51
                                                                              48

be deemed to have been terminated by Purchaser, effective on the date of
Contractor's notice, in accordance with Sub-Article 14(A) and the remaining
provisions of Article 14 shall apply.

ARTICLE 16  TITLE AND RISK OF LOSS

      A. Except as provided in Article 18 (Intellectual Property), Article 20
(Safeguarding of Information and Technology) and Article 21 (Export Control),
title to all Supplies provided by the Contractor hereunder for incorporation in
or attachment to a Segment shall pass to and vest in the Purchaser in accordance
with Article 9 (Acceptance). Risk of loss or damage to all Supplies provided by
the Contractor for incorporation in or attachment to such Segment shall pass to
and vest in the Purchaser in accordance with Article 9. Upon termination of this
Contract pursuant to Article 13 (Termination for Default) or 14 (Termination for
Convenience), the Purchaser may require, upon full payment of all amounts due
thereunder (provided that, without limiting Purchaser's obligation to make any
such payment, if this Contract is terminated by Purchaser because of a
Bankruptcy Event full payment shall not be required prior to the transfer of
title), that title to the equipment, materials and supplies, which has not
previously passed to the Purchaser, pass to the Purchaser, free and clear of all
liens, claims, charges and other encumbrances other than those deriving through
Purchaser.

      B. Upon the passage of title in accordance with the terms of Article 13
(except a transfer described in the proviso of the last sentence of Sub-Article
16(A)), the Contractor warrants that all parts, materials, and equipment to
which title has passed will be free and clear of all liens, claims, charges and
other encumbrances other than those deriving through the Purchaser.

ARTICLE 17  FORCE MAJEURE

      A. The Contractor shall not be responsible for any loss, damage, delay or
failure of performance resulting directly or indirectly from any cause which is
beyond its reasonable control ("Force Majeure"), including but not limited to:
delay in obtaining or failure to obtain any Owner Permits (subject to the
provisions of Sub-Article 7(D)); acts of God or of the public enemy; acts or
failures to act (other than with respect to Contractor Permits) of any
governmental authority unless resulting from any act or omission of Contractor;
war or warlike operations, civil war or commotion, mobilizations or military
call-up, and acts of similar nature; revolution, rebellions, sabotage, and
insurrections or riots; fires, floods, epidemics quarantine restrictions;
strikes, and other labor actions; freight embargoes; unworkable weather (so long
as Contractor shall have taken reasonably foreseeable unworkable weather into
account when planning its Work schedule; trawler or anchor damage caused by
other marine activity such as fishing, marine research and marine development;
acts or omissions of transporters; or a Purchaser Hindrance, but only to the
extent that the obligation underlying such Hindrance is not performed at the
time contemplated by the Plan of Work, provided that the following shall not
constitute Force Majeures: (i) a loss by Contractor of employees (other than by
reason of Force Majeure), (ii) strikes and other labor actions involving the
Contractor's own work force, (iii) the first 5 days of unworkable weather
(unless any such day occurs during the 30 days immediately preceding the then
Scheduled RFS Date), (iv) the failure (other than by reason of Force Majeure) of
any subcontractor, supplier or transporter to perform its obligations to
Contractor (including on
<PAGE>   52
                                                                              49

account of insolvency), (v) the unavailability of any raw materials or
components, unless such raw materials or components are generally unavailable in
the marketplace at the time Contractor should have ordered them or are
unavailable by reason of force majeure or (vi) any increase in Contractor's
costs.

      B. If any such Force Majeure causes an increase in the time or costs
required for performance of any of its duties or obligations, the Contractor
shall be entitled to an equitable extension of time for completion of the Work
or the Upgrade Work, as the case may be, but not any adjustment in the Contract
Price nor any reimbursement for any such additional costs incurred.

      C. Increase in cost due to Purchaser Hindrance will be as provided for in
Article 12 (Purchaser's Obligations).

      D. The Contractor shall inform the Purchaser promptly with written
notification, and in all cases within fourteen (14) days of discovery and
knowledge, of any occurrence covered under this Article and shall use its
reasonable efforts to minimize such additional delays. The Contractor shall
promptly provide an estimate of the anticipated time required to complete the
Work or the Upgrade Work. Contractor shall be entitled to an equitable extension
of time resulting from the Force Majeure condition, but only to the extent that
such Force Majeure actually causes a delay in the timely completion of the Work
or Upgrade Work after all reasonable efforts to minimize such a delay have been
made.

      E. Within thirty (30) days of receipt of such a notice from Contractor,
the Purchaser and the Independent Engineer may provide a written response. The
absence of a response shall not be deemed as acceptance of Contractor's notice
and request for additional time.

      F. If a Force Majeure continues for a total of two hundred (200) days,
either Party may terminate the Contract by notice to the other and the Contract
shall be deemed to have been terminated by Purchaser, effective on the date of
the terminating Party's notice, in accordance with Sub-Article 14(A) and the
remaining provisions of Article 14 shall apply to such termination.

      G. Every 45 days during the period of Force Majeure, the Parties shall
meet and review the circumstances surrounding the Force Majeure, including,
without limitation, the anticipated date of recommencing work.

ARTICLE 18  INTELLECTUAL PROPERTY

      A.    Ownership

            All right, title, and interest in and to all Intellectual Property
(excluding Project Patent Rights) created or developed by Contractor in the
course of its performance under this Contract that is (a) specifically and
exclusively applicable to the System or a System Upgrade; and (b) either (i)
embodied in Deliverable Technical Material (as that term is defined in
Sub-Article 18(B) below) or (ii) embodied in the System or a System Upgrade (the
"Project
<PAGE>   53
                                                                              50

Intellectual Property"), is and shall remain the sole property of Purchaser.
Contractor represents that as of the date of this Contract, no software is
planned to be developed that would be included as Project Intellectual
Property.* All right, title and interest in and to all Intellectual Property
created or developed by Contractor before commencing its performance under this
Contract, or created or developed by Contractor exclusively in connection with
activities other than its performance under this Contract, or created or
developed by Contractor in the course of its performance under this Contract
that is not Project Intellectual Property, and all Project Patent Rights
(collectively, the "Contractor Intellectual Property"), is and shall remain the
sole property of Contractor. Unless otherwise expressed in this Contract, no
license is implied or granted herein to Purchaser to any Contractor Intellectual
Property by virtue of this Contract, nor by the transmittal or disclosure of any
such Contractor Intellectual Property to Purchaser. Any Contractor Intellectual
Property disclosed, furnished, or conveyed to Purchaser that is marked as
"Proprietary" or "Confidential" (or if transmitted orally is identified as being
proprietary or confidential in a subsequent writing) shall be treated in
accordance with the provisions of Article 20 (Safeguarding of Information and
Technology). As used herein, "Intellectual Property" means any information,
computer or other apparatus programs, software, specifications, drawings,
designs, sketches, tools, market research or operating data, prototypes,
records, documentation, works of authorship or other creative works, ideas,
concepts, methods, inventions, discoveries, improvements, or other business,
financial and/or technical information (whether or not protectable or
registrable under any applicable intellectual property law). As used herein,
"Project Patent Rights" means all inventions, discoveries, methods and
improvements of a patentable nature created or developed by Contractor in the
course of its performance under this Contract. Project Intellectual Property
will include the materials to be listed in Exhibit H, to be created mutually by
the Parties within thirty (30) days of execution of this Contract, as it may be
amended from time to time by mutual agreement of the Parties.

      B.    Licenses

            Contractor shall furnish to Purchaser, upon the transfer of title to
any portion of the System or a System Upgrade pursuant to Article 9, copies of
all technical information, specifications, drawings, designs, sketches, tools,
operating data, records, documentation and/or other types of engineering or
technical data or information reasonably relating to the operation, maintenance
or repair of each component of such portion of the System or System Upgrade as
delivered by Contractor (the "Deliverable Technical Material"). Deliverable
Technical Material shall not be deemed to include Deliverable Software.
Contractor grants to Purchaser a perpetual, royalty-free, non-transferable
(except under the circumstances specified in Sub-Article 18(F) below) license to
use and reproduce those Deliverable Technical Materials owned, controlled, or
developed by Contractor and all Contractor Intellectual Property included in or
necessary to use all the Deliverable Technical Materials for purposes of
fulfilling Purchaser's obligations under this Contract and using and operating
the System (as upgraded by any System Upgrades) supplied by Contractor with the
right to employ third parties (under appropriate written

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   54
                                                                              51

obligations respecting confidentiality) to assist Purchaser in fulfilling its
obligations under this Contract and in using and operating the System (as
upgraded by any System Upgrades), but with no right to sublicense. Contractor
grants to Purchaser a perpetual, royalty-free, non-transferable (except under
the circumstances specified in Sub-Article 18(F) below) license to use and
reproduce those portions of Deliverable Technical Materials owned or controlled
by third parties (but only to the extent of any rights which may have been
granted to Contractor by such third parties) for the purpose of fulfilling
Purchaser's obligations under this Contract and using and operating the System
supplied by Contractor with the right to employ third parties (under appropriate
written obligations respecting confidentiality) to assist Purchaser in
fulfilling its obligations under this Contract and in using and operating the
System (as upgraded by any System Upgrades), but with no right to sublicense.
Except as set forth in this provision, no license under Contractor's patents,
copyrights, trade or service marks, trade secrets or other intellectual property
rights protectable under law in the United States or any foreign country is
granted to Purchaser. It is expressly understood that it shall not be a
violation of this license for Purchaser, on its own behalf or through third
parties (under appropriate written obligations respecting confidentiality)
specifically employed for the purpose, to use and reproduce Deliverable
Technical Material that is not Project Intellectual Property to modify the
System (as upgraded by any System Upgrades) or connect the System (as upgraded
by any System Upgrades) to other systems, provided that Purchaser may not use
the Deliverable Technical Materials that is not Project Intellectual Property in
achieving such modification or interconnection for any purpose other than
determining the technical configuration, systems interface and/or
interoperability requirements of the System (as upgraded by any System Upgrades)
as delivered by Contractor (subject to the rights of third parties therein and
thereto), and subject to the limitations on Contractor's obligations as set
forth in Articles 10(D) and 19(A) concerning any such modification or
interconnection.

      C.    Deliverable Software

            Contractor shall furnish to the Purchaser, upon transfer of title to
any portion of the System or System Upgrade pursuant to Article 9, copies of all
computer or other apparatus programs and software, in executable form, and
related documentation relating to the operation, maintenance, or repair of the
computer systems of such portion of the System or System Upgrade, as the case
may be, as delivered by Contractor (the "Deliverable Software"). In the case of
Contractor Intellectual Property, such copies of programs and software shall
consist solely of executable code provided in offline media (e.g., tapes, or
diskettes) for restoration purposes, sufficient to operate, maintain or repair
the computer systems of such portion of the System or System Upgrade, as the
case may be, as delivered by Contractor, and in the case of Project Intellectual
Property, such programs and software shall be delivered in both source and
object code forms. Contractor shall furnish to Purchaser, from time to time
during the Warranty Period or any Upgrade Warranty Period, copies of all
computer or other apparatus programs and software, in executable form (and in
the case of Project Intellectual Property, in source code form), and related
documentation that Contractor may develop to correct errors or to maintain
Deliverable Software previously furnished to Purchaser, which shall also be
treated as Deliverable Software for purposes of this Contract upon delivery
thereof to Purchaser. Contractor grants to Purchaser a perpetual, royalty-free,
non-transferable (except under the circumstances specified in Sub-Article 18(F)
below) license to use and reproduce the Deliverable Software
<PAGE>   55
                                                                              52

Materials owned, controlled, or developed by Contractor for the purpose of
fulfilling Purchaser's obligations under this Contract and using and operating
the System (as upgraded by any System Upgrades) supplied by Contractor with the
right to employ third parties (under appropriate written obligations respecting
confidentiality) to assist Purchaser in fulfilling its obligations under this
Contract and in using and operating the System (as upgraded by any System
Upgrades), but with no right to sublicense. Contractor grants to Purchaser a
perpetual, royalty-free, non-transferable (except under the circumstances
specified in Sub-Article 18(F) below) license to use and reproduce those
portions of Deliverable Software owned or controlled by third parties (but only
to the extent of any rights which may have been granted to Contractor by such
third parties) for the purpose of fulfilling Purchaser's obligations under this
Contract and using and operating the System (as upgraded by any System Upgrades)
supplied by Contractor with the right to employ third parties (under appropriate
written obligations respecting confidentiality) to assist Purchaser in
fulfilling its obligations under this Contract and in using and operating the
System (as upgraded by any System Upgrades), but with no right to sublicense.
These licenses shall be limited to the right to use Deliverable Software that is
not Project Intellectual Property only with the particular type of computer
equipment or substantially similar replacement equipment for which such
Deliverable Software was provided in the System (as upgraded by any System
Upgrades) as supplied by Contractor.

            1.    Confidentiality

                  Purchaser shall keep the Deliverable Software that is not
                  Project Intellectual Property confidential in accordance with
                  Article 20 (Safeguarding of Information and Technology) and
                  Article 21 (Export Control) and agrees to use its best efforts
                  to see that its employees, consultants, and agents, and other
                  users of such software, comply with the provisions of this
                  Contract. Purchaser also agrees to refrain from taking any
                  steps, such as reverse assembly or decompilation, to derive a
                  source code equivalent of any object code that is furnished by
                  Contractor; provided that Contractor is willing when requested
                  by Purchaser and is able to maintain the Deliverable Software
                  that is not Project Intellectual Property in accordance with
                  the terms of a support and maintenance agreement to be entered
                  into on such terms to be agreed upon by the Parties, which
                  terms shall in all events contain assurances of support and
                  maintenance that are commercially reasonable and in any event
                  at least as favorable as those provided by Contractor to other
                  licensees, or Contractor is willing and able to enter into an
                  agreement to maintain the Deliverable Software upon terms
                  reasonably comparable to the pertinent terms of the initial
                  agreement to be entered into by the Parties with regard to
                  support and maintenance after the expiration or termination
                  thereof or does not go insolvent or bankrupt to thereby
                  trigger a software escrow event in accordance with Article
                  18(G) (Escrow). In the case of insolvency or bankruptcy of
                  Contractor, Purchaser shall limit any derivation of a source
                  code equivalent to that portion of the Deliverable Software
                  that is Contractor Intellectual Property. Purchaser shall not
                  under any circumstances take any steps to derive a source code
                  equivalent from that
<PAGE>   56
                                                                              53

                  portion of the Deliverable Software comprising commercial,
                  off-the-shelf software developed or provided by third parties.

            2.    Backup Copies

                  Purchaser may make and retain two archive copies in executable
                  form of the Deliverable Software that is not Project
                  Intellectual Property. Any copy will contain the same
                  copyright notice and proprietary markings as are on the
                  original software and shall be subject to the same
                  restrictions as the originals.

            3.    Termination of Software Licenses

                  In the event of (i) use by the Purchaser of Deliverable
                  Software that is not Project Intellectual Property in a manner
                  other than that permitted in Sub-Article 18(C) or (ii) any
                  other material breach of this Article 18 by Purchaser that in
                  either event is not cured within sixty (60) days from receipt
                  by Purchaser of written notice of such impermissible use or
                  breach, Contractor, at its option, may terminate the rights
                  granted to Purchaser pursuant to this Article, upon written
                  notice to Purchaser, which termination shall take effect no
                  sooner than sixty (60) days following receipt by Purchaser of
                  a subsequent written notice of termination. Upon termination,
                  Purchaser shall either return or destroy, at Contractor's
                  option, all copies of Deliverable Software that is not Project
                  Intellectual Property furnished under this Contract.

            4.    Indemnification

                  In the event of (i) use by Purchaser of Deliverable Software
                  that is not Project Intellectual Property furnished hereunder
                  other than that permitted in Sub-Article 18(C) or (ii) any
                  other material breach of this Article 18 by Purchaser, the
                  Purchaser shall indemnify and hold Contractor harmless from
                  any and all third party claims resulting therefrom whether
                  arising from a defect in the software or otherwise.

      D.    Trademarks, Tradenames, etc.

            No rights are granted herein to either Party to use any
identification (such as, but not limited to tradenames, trademarks, service
marks or symbols, and abbreviations, contractions, or simulations thereof) owned
or used by the other Party or its parent company or its affiliates to identify
itself or its affiliates or any of its products or services. Each Party agrees
that it will not, without the prior written permission of the other Party, use
such identification in advertising, publicity, packaging, labeling, or in any
other manner to identify itself or any of its products, services, or
organizations, or represent directly or indirectly that any product, service, or
organization of it is a product, service, or organization of the other Party or
its affiliates, or that any product or service of a Party is made in accordance
with or utilizes any intellectual property of the other Party or its affiliates.

      E.    DISCLAIMER, LIMITATION OF LIABILITY
<PAGE>   57
                                                                              54

            CONTRACTOR REPRESENTS THAT ANY INFORMATION OR INTELLECTUAL PROPERTY
FURNISHED IN CONNECTION WITH THIS CONTRACT SHALL BE TRUE AND ACCURATE TO THE
BEST OF ITS KNOWLEDGE AND BELIEF, BUT CONTRACTOR SHALL NOT BE HELD TO ANY
LIABILITY FOR UNINTENTIONAL ERRORS OR OMISSIONS THEREIN. EXCEPT AS EXPRESSLY
PROVIDED, CONTRACTOR MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESSLY OR
IMPLIEDLY. BY WAY OF EXAMPLE, BUT NOT OF LIMITATION, CONTRACTOR AND ITS PARENT
COMPANY AND AFFILIATES MAKES NO REPRESENTATIONS OR WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF INFORMATION OR
INTELLECTUAL PROPERTY DISCLOSED OR PROVIDED HEREUNDER WILL NOT INFRINGE ANY
PATENT OR OTHER INTELLECTUAL PROPERTY RIGHT OF A THIRD PARTY. EXCEPT AS
OTHERWISE PROVIDED IN THIS CONTRACT, CONTRACTOR AND ITS PARENT AND AFFILIATES
SHALL NOT BE HELD TO ANY LIABILITY WITH RESPECT TO ANY CLAIM BY PURCHASER OR ANY
THIRD PARTY CLAIM AGAINST PURCHASER ON ACCOUNT OF, OR ARISING FROM, PURCHASER'S
USE OF INFORMATION OR INTELLECTUAL PROPERTY DISCLOSED OR PROVIDED BY CONTRACTOR.

      F.    Transferability

            The licenses granted to Purchaser by Contractor in the Deliverable
Technical Materials and Deliverable Software are personal and non-transferable,
except that Purchaser may assign or transfer such licenses to an affiliated
entity under common control with the Purchaser or to any entity succeeding to
Purchaser's entire interest in the System (as upgraded by any System Upgrades)
as a result of reorganization or restructuring of the Purchaser or in the event
of a change of control of the Purchaser.

      G.    Deliverable Software Escrow

            Within sixty (60) days of the Date of Provisional Acceptance or
Commercial Acceptance of any portion of the System or any System Upgrade,
Contractor shall deliver copies of source code and related documentation for
that portion of Deliverable Software that is Contractor Intellectual Property
(but not that portion of Deliverable Software comprising commercial,
off-the-shelf software, or software developed or provided by third parties) to a
third party commercial software escrow service, and from time to time as it
becomes available, copies of source code for updates, maintenance releases, or
other new versions of the Deliverable Software that is Contractor Intellectual
Property that is reasonably relating to the operation, maintenance or repair of
the computer systems of any portion of the System or any System Upgrade as
delivered by Contractor during the System's twenty-five (25) year Design Life
Period.

            A detailed listing of commercial, off-the-shelf software, or
software developed or provided by third parties to be included in the
Deliverable Software shall be delivered by Contractor to Purchaser within sixty
(60) days of the Date of Provisional Acceptance of any portion of the System or
any System Upgrade, as the case may be.
<PAGE>   58
                                                                              55

            The escrow service shall be authorized by Contractor to release the
escrowed software to Purchaser within five (5) business days after the receipt
of notice by Purchaser that (i) a Bankruptcy Event has occurred, (ii) that the
Contractor is no longer engaged in the business of operating or maintaining, or
providing support for other parties in operating or maintaining, systems
comparable to the System (as modified by System Upgrades) or (iii) that
Purchaser has terminated the Contract pursuant to Article 12 (Termination for
Default) due to Contractor's default, unless Contractor agrees to continue to
support Purchaser with respect to Deliverable Software.

ARTICLE 19  INFRINGEMENT

      A. The Contractor agrees to defend or settle at its own expense all suits
for infringement of any patent, copyright, trademark or other form of
intellectual property right in any country of the world, for the use and
operation of the System (as upgraded by any System Upgrades) as supplied by
Contractor and for any component part thereof or material or equipment used
therein (or the manufacture of any material or the normal use thereof) provided
by the Contractor or on its behalf pursuant to this Contract and will hold the
Purchaser harmless from all expense of defending any such suit and all payments
for final judgment assessed on account of such infringement, except such
infringement or claim arising from:

            1.    The Contractor's adherence to the Purchaser's directions in
                  the design and configuration of the System (as upgraded by any
                  System Upgrades) or to use materials, parts or equipment of
                  the Purchaser's selection; or

            2.    Such material, parts or equipment furnished to the Contractor
                  by the Purchaser, other than in each case, items of the
                  Contractor's design or selection or the same as any of the
                  Contractor's commercial merchandise or in processes or
                  machines of the Contractor's design or selection used in the
                  manufacture of such standard products or parts; or

            3.    Use of the System (as upgraded by any System Upgrades) or the
                  materials, parts or equipment furnished by Contractor other
                  than for the purposes indicated in, or reasonably to be
                  inferred from, this Contract or in conjunction with other
                  products; or

            4.    Modification of the System (as upgraded by any System
                  Upgrades) or the materials, parts or equipment furnished by
                  the Contractor, or connection of the System to another system
                  by any person or entity other than Contractor, without prior
                  expressed written approval by Contractor.

      B. The Purchaser will, at its own expense, defend all suits against the
Contractor for such excepted infringement and hold the Contractor harmless from
all expense of defending any such suit and from all payments by final judgment
assessed against the Contractor on account of such excepted infringement.
<PAGE>   59
                                                                              56

      C. The Contractor and the Purchaser agree to give each other prompt
written notice of claims and suits for infringement, full opportunity and
authority to assume the sole defense, including appeals and, upon request and at
its own expense, the other agrees to furnish all information and assistance
available to it for such defense.

      D. If all or any portion of the System (as upgraded by any System
Upgrades) or any material, part or equipment provided by the Contractor or on
its behalf is held to constitute an infringement (excluding such excepted
infringements specified in Sub-Article 19(A)) and is subject to an injunction
restraining its use or any order providing for its delivery up to or
destruction, or if in respect of any such claim of infringement the Contractor
deems it advisable to do so, the Contractor shall at its own expense either:

            1.    Procure for the Purchaser the right to retain and continue to
                  use the System, the affected portion thereof, or any such
                  material, part or equipment without interruption for the
                  Purchaser;

            2.    Replace or modify the System, the affected portion thereof, or
                  any material, part or equipment so that it becomes
                  noninfringing while continuing to meet the Performance
                  Requirements or

            3.    If the remedies specified in Sub-Articles 19(D)(1) an 19(D)(2)
                  are not feasible, refund to the Purchaser the full purchase
                  price paid for the System, the affected portion thereof, or
                  any material, part or equipment found to be infringing.

      E. In no event shall the Purchaser make any admission or settle any claim
in relation with any claim for infringement without Contractor's consent.

ARTICLE 20  SAFEGUARDING OF INFORMATION AND TECHNOLOGY

      A. In performance of this Contract, it may be mutually advantageous to the
Parties hereto to share certain specifications, designs, plans, drawings,
software, market research or operating data, prototypes, or other business,
financial, and or/technical information related to products, services, or
systems which are proprietary to the disclosing Party or its affiliates (and in
the case of Contractor, Contractor's parent company) (together with this
Contract and related documents, "Information"). The Parties recognize and agree
that Information includes information that was supplied in contemplation hereof
prior to execution of this Contract, and further agree that Information includes
information in both tangible and intangible form.

      B. Unless such Information was previously known to the Party receiving
such Information free of any obligation to keep it confidential, or such
Information has been or is subsequently made public through other than
unauthorized disclosure by the receiving Party or is independently developed by
the receiving Party (as documented by the records of the receiving Party), it
shall be kept confidential by the Party receiving such Information, shall be
disclosed only in the performance of this Contract, and may not be disclosed for
any other purposes except upon such terms as may be agreed upon in writing by
the Party owning such Information. The
<PAGE>   60
                                                                              57

receiving Party may disclose such Information to other persons, upon the
furnishing Party's prior written authorization, but solely to perform acts which
this Article expressly authorizes the receiving Party to perform itself and
further provided such other person agrees in writing (a copy of which writing
will be provided to the furnishing Party at its request) to the same conditions
respecting disclosure and use of Information contained in this Article and to
any other reasonable conditions requested by the furnishing Party. Nothing
herein shall prevent a Party from disclosing Information (a) upon the order of
any court or administrative agency, (b) upon the request or demand of, or
pursuant to any regulation of, any regulatory agency or authority, (c) to the
extent reasonably required in connection with the exercise of any remedy
hereunder and (d) to a Party's legal counsel or independent auditors.

      C. The Purchaser may disclose Information to its lenders and their
representatives in connection with obtaining financing for the System, provided
that each such lender or their representative is informed in writing of and
agrees to abide by the confidentiality terms contained in this Contract. Any
such disclosure of Information shall be subject to the restrictions in
Sub-Article 20(B).

ARTICLE 21  EXPORT CONTROL

            The Parties acknowledge that any products, software, and technical
information (including, but not limited to, services and training) provided by
either Party under this Contract are or may be subject to export laws and
regulations of the United States and the destination country(ies) and any use or
transfer of such products, software and technical information must be authorized
under those Laws. The Parties agree that they will not use, distribute, transfer
or transmit the products, software or technical information (even if
incorporated into other products) except in compliance with export Laws. If
requested by either Party, the other Party agrees to sign all necessary
export-related documents as may be required to comply with export Laws.

ARTICLE 22  LIQUIDATED DAMAGES

      A. If Phase 1A of the System is not Ready for Commercial Acceptance or
Provisional Acceptance within fourteen (14) days (the "Grace Period") following
the Scheduled Phase 1A RFS Date, as it may have been extended under:

            1. Article 6 (Contract Variations);

            2. Article 17 (Force Majeure);

            3. Article 15 (Suspension); or

            4. Other arrangements as agreed between the Purchaser and the
               Contractor;

then Contractor shall pay to Purchaser for each day of delay following the
expiration of the Grace Period for up to 200 days or, if earlier, to the day
Contractor begins making payments under

<PAGE>   61
                                                                              58

Paragraph B of this Article 22, by way of pre-estimated and liquidated damages
for the delay and not as a penalty, an amount equal to 0.05% of the Phase 1A
Price for the System, subject to the maximum aggregate amount set forth in
paragraph D of this Article 22.

      B. If the System is not Ready for Commercial Acceptance or Provisional
Acceptance by the Scheduled System RFS Date, as it may have been extended under:

            1.    Article 6 (Contract Variations);

            2.    Article 17 (Force Majeure);

            3.    Article 15 (Suspension); or

            4.    Other arrangements as agreed between the Purchaser and the
                  Contractor;

then Contractor shall pay to Purchaser for each day of delay, for up to 200
days, by way of preestimated and liquidated damages for the delay and not as a
penalty, an amount equal to 0.05% of the Initial Contract Price for the System,
less, if the Date of Commercial Acceptance or Date of Provisional Acceptance of
Phase 1A and/or Phase 1B has occurred, the Phase 1A Price and/or the Phase 1B
Price, as the case may be, subject to the maximum aggregate amount set forth in
paragraph D of this Article 22.

      C. If a System Upgrade is not Ready for Commercial Acceptance or
Provisional Acceptance by the Scheduled Upgrade Date, as it may have been
extended under:

            1.    Article 6 (Contract Variations);

            2.    Article 17 (Force Majeure);

            3.    Article 15 (Suspension); or

            4.    Other arrangements as agreed between the Purchaser and the
                  Contractor;

then Contractor shall pay to Purchaser for each day of delay, for up to 90 days,
by way of preestimated and liquidated damages for the delay and not as a
penalty, an amount equal to .05% of the Initial Upgrade Contract Price.

      D. In no event will the aggregate amount of Liquidated Damages exceed 10%
of the Initial Contract Price.

ARTICLE 23  LIMITATION OF LIABILITY/INDEMNIFICATION

      A. NOTWITHSTANDING ANY OTHER PROVISION IN THIS CONTRACT, AND IRRESPECTIVE
OF ANY FAULT, NEGLIGENCE OR GROSS NEGLIGENCE OF ANY KIND, IN NO EVENT SHALL
EITHER PARTY OR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS BE LIABLE
FOR ANY CONSEQUENTIAL,

<PAGE>   62
                                                                              59

INCIDENTAL, INDIRECT, RELIANCE OR SPECIAL (INCLUDING PUNITIVE) DAMAGES,
INCLUDING, BUT NOT LIMITED TO, LOSS OF REVENUE, LOSS OF BUSINESS OPPORTUNITY OR
THE COSTS ASSOCIATED WITH THE USE OF RESTORATION FACILITIES RESULTING FROM ITS
FAILURE TO PERFORM PURSUANT TO THE TERMS AND CONDITIONS OF THIS CONTRACT.

      B. EXCEPT AS SET FORTH BELOW IN THE LAST TWO SENTENCES OF THIS SUB-ARTICLE
23(B), THE CONTRACTOR'S MAXIMUM AGGREGATE LIABILITY, WHETHER IN TORT, CONTRACT
OR OTHERWISE, EXCEPT FOR CLAIMS RELATING TO SYSTEM UPGRADES, SHALL NOT EXCEED
ONE HUNDRED PERCENT (100%) OF THE CONTRACT PRICE. THE CONTRACTOR'S MAXIMUM
AGGREGATE LIABILITY FOR CLAIMS RELATING TO SYSTEM UPGRADES (IF CONTRACTOR CAN
PROVE THAT THE SYSTEM WAS DESIGNED WITH SUFFICIENT TRANSMISSION MARGIN AND THUS
SUCH CLAIMS DO NOT ARISE UNDER CLAUSE (ii) OF SUB-ARTICLE 10(B)) SHALL NOT
EXCEED ONE HUNDRED PERCENT (100%) OF THE APPLICABLE UPGRADE PRICE. THE FOREGOING
LIMITATION SHALL NOT APPLY TO CLAIMS UNDER SUB-ARTICLES 19(A) AND 23(C). IF
CONTRACTOR CANNOT PROVE THAT THE SYSTEM WAS DESIGNED WITH SUFFICIENT
TRANSMISSION MARGIN FOR A SYSTEM UPGRADE, THE CONTRACTOR'S MAXIMUM AGGREGATE
LIABILITY FOR CLAIMS ARISING UNDER CLAUSE (ii) OF SUB-ARTICLE 10(B) SHALL NOT
EXCEED ONE HUNDRED PERCENT (100%) OF THE UPGRADEABILITY LIABILITY LIMIT.

      C. Contractor, at its expense, shall defend, indemnify and hold harmless
Purchaser, its affiliates, agents, subcontractors and employees (collectively,
the "Indemnitees") against any and all claims, proceedings, demands, costs,
expenses, liabilities (including without limitation, reasonable legal fees), and
judgements for losses (collectively, "Liabilities") asserted against or incurred
by any Indemnitee, arising out of, or in connection with (a) this Contract,
and/or the performance thereof by Contractor or any of its subcontractors, or
(b) the operation and maintenance of the System prior to the risk of loss
passing to Purchaser, resulting from acts or omissions of Contractor or any
Subcontractor, regardless of whether involving errors, negligence or willful
misconduct or resulting from, strict liability or statutory liability, except to
the extent that such Liabilities were caused by the negligent acts or willful
misconduct of Purchaser. The defense, indemnification and save harmless
obligation is specifically conditioned on the following: (i) Purchaser providing
prompt notification in writing of any such Liability when it obtains Actual
Knowledge thereof, unless such failure shall not have materially impaired
Contractor's ability to defend against such claim; (ii) Contractor having
control of the defense of any such action, claim or demand and of all
negotiations for its settlement or compromise; and (iii) Purchaser cooperating,
at Contractor's expense, in a reasonable way to facilitate the defense of such
claim or demand or the negotiations for its settlement. The Purchaser, at its
option, shall be entitled to participate, at its own expense, in any proceeding,
claim or demand involving an Indemnitee.

      D. Purchaser, at its expense, shall defend, indemnify and hold harmless
Contractor, its agents, subcontractors and employees against any and all claims,
demands, and judgments for losses due to any act or omission, arising out of, or
in connection with this Contract or, after risk of loss passes to Purchaser, the
operation or maintenance of the System, to the extent such losses
<PAGE>   63
                                                                              60

were caused by the negligence or willful misconduct of the Purchaser, its
subcontractors, employees or agents (other than Contractor). The defense,
indemnification and save harmless obligation is specifically conditioned on the
following (i) Contractor providing prompt notification in writing of any such
claim or demand when it obtains Actual Knowledge thereof, unless such failure
shall not have materially impaired Purchaser's ability to defend against such
claim; (ii) Purchaser having control of the defense of any such action, claim or
demand and of all negotiations for its settlement or compromise; and (iii)
Contractor cooperating, at Purchaser's expense, in a reasonable way to
facilitate the defense of such claim or demand or the negotiations for its
settlement.

ARTICLE 24  COUNTERPARTS

            This Contract may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

ARTICLE 25  DESIGN AND PERFORMANCE RESPONSIBILITY; SUBCONTRACTORS

      A. The Contractor shall be solely responsible for the engineering and
design of and for all details of the System and the System Upgrades and for the
adequacy thereof.

      B. The Contractor's responsibility for engineering and designing of the
System and the System Upgrades shall not in any way be diminished, nor shall the
Contractor's design approach be restricted or limited by, the Purchaser's
acceptance of the Contractor's guidance or recommendations as to engineering
standards and design specifications, or by the Purchaser's approval, suggestions
or recommendations on any aspect of the engineering or design.

      C. Purchaser shall use reasonable efforts in assisting the Contractor, at
Contractor's expense, to obtain in a timely manner accurate information required
for the Contractor to perform the Work and the Upgrade Work, which Contractor
cannot expeditiously and cost-effectively obtain from any source other than the
Purchaser.

      D. The Contractor will select Subcontractors in connection with the
performance of the Work such that all Work provided by any such Subcontractors
meet the System specifications set out in the Technical Volume hereto and the
reliability and performance requirements set forth in this Contract. Regardless
of whether or not the Contractor obtains approval from the Purchaser of a
Subcontractor or whether the Contractor uses a Subcontractor recommended or
designated by the Purchaser, use by the Contractor of a Subcontractor will not,
under any circumstances: (i) give rise to any claim by the Contractor against
the Purchaser if such Subcontractor breaches its subcontract or contract with
the Contractor; (ii) give rise to any claim by such Subcontractor against the
Purchaser; (iii) create any contractual obligation by the Purchaser to the
Subcontractor; (iv) give rise to a waiver by the Purchaser of its rights to
reject any defects or deficiencies or defective Work; or (v) in any way release
the Contractor from being solely responsible to the Purchaser for the Work to be
performed under this Contract.
<PAGE>   64
                                                                              61

      E. The Contractor is the general contractor for the Work and remains
responsible for all of its obligations under this Contract, including the Work,
regardless of whether a subcontract or supply agreement is made or whether the
Contractor relies upon any Subcontractor to any extent. The Contractor's use of
Subcontractors for any of the Work will in no way increase the Contractor's
rights or diminish the Contractor's liabilities to the Purchaser with respect to
this Contract, and in all events the Contractor's rights and liabilities
hereunder with respect to the Purchaser will be as though the Contractor had
itself performed such Work. The Contractor will be liable for any delays caused
by any Subcontractor as if such delays were caused by the Contractor.

      F. The terms of this Contract will in all events be binding upon the
Contractor regardless of and without regard to the existence of any inconsistent
terms in any agreement between the Contractor and any Subcontractor whether or
not and without regard to the fact that the Purchaser may have directly and/or
indirectly had notice of any such inconsistent term.

      G. The Contractor must make all payments to all Subcontractors (except in
the case of legitimate disputes between the Contractor and any such
Subcontractor arising out of the agreement between the Contractor and such
Subcontractor) in accordance with the respective agreements between the
Contractor and its Subcontractors such that Subcontractors will not be in a
position to enforce liens and/or other rights against the Purchaser, the System
or any part thereof.

      H. If a proposed Subcontractor of major Supplies is not listed on Exhibit
G hereto, Contractor shall obtain approval thereof from Purchaser, which
approval will not be unreasonably withheld. Contractor will not terminate any
such listed or approved subcontractor except for good cause (taking into account
the interests of Purchaser) and after consultation with Purchaser;*

      I. Purchaser shall have the option to designate Global Marine as the
Subcontractor that will perform all (or such portion designated by Purchaser) of
the marine installation work for the System and Contractor shall utilize such
company for such purpose if so requested by Purchaser.

      J. Contractor hereby explicitly waives and agrees not to assert any
defense or claim it may have against Purchaser based upon the fact that
Purchaser is an affiliate of Global Marine unless Purchaser and Global Marine
have acted together in bad faith toward Contractor under and in connection with
this Contract.

ARTICLE 26  PRODUCT CHANGES

            The Contractor may at any time make changes to the System or System
Upgrades furnished pursuant to this Contract, or modify the drawings and
published specifications relating thereto, or substitute equipment of later
design, provided the changes, modifications, or substitutions under normal and
proper use do not impact upon the form, fit, expected life or function of the
System as provided in the System Performance Requirements.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   65
                                                                              62

ARTICLE 27  RISK AND INSURANCE

      A. The Contractor shall at all times maintain, and upon request, the
Contractor shall furnish the Purchaser with certificates, or other reasonable
evidence, that Contractor maintains, the following insurance or has adequate
self-insurance (other than as required to comply with any statutory insurance
requirements); provided, that the following insurance coverages may be combined
or in different form so long as Contractor maintains insurance consistent with
the following requirements:

            1.    Workmen's Compensation and Employers Liability Insurance (with
                  a limit of not less than    *    for any one incident or
                  series of incidents arising from one event or such higher
                  limit as may be required by the laws of any jurisdiction)
                  covering the officers and employees of the Contractor for all
                  compensation or other benefits required of the Contractor by
                  the laws of any nation or political sub-division thereof to
                  which the Contractor and its operations under this Contract
                  are subject in respect of injury of death of any such
                  employee.

            2.    Comprehensive General Public Liability Insurance, covering
                  personal injury and/or property damage, with combined single
                  limits of not less than       *      for claims of injury or
                  death of any persons or loss of or damage to property
                  resulting from any one accident. This insurance to be extended
                  to provide Marine Comprehensive General Liability including
                  liabilities arising out of the operation of subsea equipment.

            3.    Comprehensive Automobile Liability insurance covering all
                  vehicles and automotive equipment owned, hired, or in the
                  custody and control of Contractor and complying with all
                  applicable legislation with limits not less than    *
                  combined single limit for the death or injury of any person
                  per accident and not less than     *      for the loss or
                  damage to property resulting from any one accident.

            4.    Excess Liability Coverage over that required in Sub-Articles
                  27(A)(1), (2) and (3) with minimum limits of     *     for
                  any one accident or occurrence.

            5.    All Risk Insurance in respect of all property of Contractor,
                  its respective officers, agents and employees connected with
                  the performance of the Work against all loss or damage from
                  whatever cause.

            6.    Conventional Marine Hull and Machinery Insurance including War
                  Risks or any vessel(s) owned, operated or chartered by the
                  Contractor, in an amount equal to the full value thereof. In
                  the event of damage to or loss of such vessel(s), the
                  Contractor agrees to look to its insurance carrier for payment
                  of such loss or damage and hereby releases the Purchaser and
                  waives any claims against the Purchaser for the loss of such
                  vessel(s)

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   66
                                                                              63

                  unless due to the negligence of Purchaser, its agent or
                  representatives (other than Contractor).

            7.    All vessels are to be entered in a Mutual Protection and
                  Indemnity Association with a full and unlimited entry or to
                  have Marine Protection and Indemnity Insurance with a limit of
                  not less than     *      including coverage for illness,
                  injury or death of crew members (unless covered under
                  Workmen's Compensation Insurance), Contractual Liability
                  Coverage, Collision and Tower's Liability, Removal of Wreck
                  and Debris and Third Party Liability.

            8.    Specialist Operations Insurance with a limit of not less than
                       *      as per London Wording 1993 or equivalent.

            9.    Transit Insurance including inland, air, and Marine Cargo
                  coverage including War (other than on land) in an amount
                  sufficient to cover the expected highest value of any one
                  shipment. Coverage to include Institute Cargo Clauses, all
                  risks 1.1.63, Institute War Clauses, London Malicious Damage
                  Clause, and Institute Strikes Riots and Civil Commotion
                  Clauses
                  or their equivalent.

            10.   Marine Cargo or equivalent is required to protect, for full
                  cost, against all risks of physical loss or damage to the
                  plant, equipment and supplies to be included in the System
                  (other than War Risks) beginning with when each such item is
                  ready for shipping and ending when the submersible plant and
                  equipment are placed overside the cable laying vessel and when
                  the equipment and supplies are delivered to the cable
                  stations, central offices, or network operation center. The
                  coverage continues to cover cable lying on the seabed.

            11.   Sea Bed or equivalent coverage (including an Old Mines and
                  Torpedoes Clause, including other derelict weapons of War) is
                  required to protect, for full cost, against all risks of
                  physical loss or damage to the submersible plant and equipment
                  described in Sub-Article 27(A)(10) above. See last paragraph.

            12.   War Risks or equivalent coverage is required to protect
                  against damage to, seizure by and/or destruction of the System
                  by means of war, piracy, takings at sea and other warlike
                  operations until discharge of the submersible plant and
                  equipment. For the purposes of this Article "discharge of the
                  submersible plant and equipment" shall be deemed to take place
                  when the plant and equipment reaches the sea bottom, as far as
                  the submersible plant and equipment is concerned, and when the
                  plant is off-loaded in the respective terminal country, as far
                  as non-submersible plant is concerned.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   67
                                                                              64

            13.   Pollution Liability (EIL) insurance for installation
                  operations and as arising from the use of vessels in an amount
                  not less than       *       or such higher sum as may be
                  required to meet any legal requirement in area of operations.

            The Comprehensive General Liability Insurance required pursuant to
Sub-Article 27(A)(2) above, shall include Contractual Liability Coverage which
shall specifically apply to the obligations assumed by the Contractor under the
Terms and Conditions of this Contract.

      B.    1.    All the foregoing insurances shall be effected with a
                  creditworthy insurer and shall be endorsed to provide
                  Purchaser with at least thirty (30) days prior written notice
                  of cancellation or material change.

            2.    All the foregoing insurances shall name Purchaser and its
                  lenders as an additional insured as to operations hereunder,
                  in which event the Contractor's insurance shall be primary to
                  any insurance carried by Purchaser.

            3.    The limits specified herein are minimum requirements and shall
                  not be construed in any way as limits of liability or as
                  constituting acceptance by Purchaser of such responsibility
                  for financial liabilities in excess of such limits. The
                  Contractor shall bear all deductibles applicable to any
                  insurance.

            4.    If it is judicially determined that the monetary limits of
                  insurance required hereunder or of any indemnity voluntarily
                  assumed under the Terms and Conditions of this Contract which
                  the Contractor agrees will be supported either by available
                  liability insurance or voluntarily self-insured, in part or
                  whole, exceeds the maximum limits permitted under applicable
                  law, it is agreed that said insurance requirements or
                  indemnity shall automatically be amended to conform to the
                  maximum monetary limits permitted under such law.

            5.    Contractor shall take reasonable steps to provide that any
                  sub-contractor engaged by it has in effect or will effect
                  Employer's Liability, Workmen's Compensation, Hull and
                  Machinery and Protection and Indemnity insurances and any
                  other insurances required by law, together with such other
                  insurances as the Contractor may consider necessary.

            6.    If the Contractor fails to effect or keep in force any of the
                  insurances required under this Contract, Purchaser may effect
                  and keep in force any such insurances and pay such premiums as
                  may be necessary for that purpose and from time to time deduct
                  the amount so paid by Purchaser from any money due or which
                  may become due to the Contractor hereunder or recover the same
                  as a debt due from the Contractor, provided that Purchaser is
                  not in Default.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   68
                                                                              65

            7.    Each Party shall give the other prompt notification of any
                  claim with respect to any of the insurances to be provided
                  hereunder, accompanied by full details giving rise to such
                  claim. Each Party shall afford the other all such assistance
                  as may be required for the preparation and negotiation of
                  insurance claims.

            8.    Contractor shall report to Purchaser as soon as practicable
                  all accidents or occurrences resulting in injuries to
                  Contractor's employees or third parties, or damage to property
                  of third parties, arising out of our during the course of
                  services for Purchaser by Contractor.

      C. The Contractor may organize such reasonable levels of deductibles,
excesses and self-insurance as it considers appropriate and which are within
prudent industry standards.

      D. The insurance requirements of this Article 27 will remain in place with
respect to each Segment, each Phase, the System or System Upgrade, as the case
may be, and will not in any way be diminished or reduced until the transfer of
title and risk of loss shall have passed to Purchaser of such Segment, such
Phase, System or System Upgrade, as the case may be, even in the event of the
sale of substantially all the assets of the Contractor by way of a merger,
consolidation or sale of assets.

ARTICLE 28  PLANT AND WORK RULES

            Employees and agents of each Party shall, while on the premises of
the other or its subcontractors, comply with all plant rules and governmental
regulations.

ARTICLE 29  RIGHT OF ACCESS AND REVIEW

      A. The Contractor shall permit access by the Purchaser or its quality
assurance (QA) Representatives (other than a competitor of the Contractor or any
affiliate of a competitor) to the Contractor's premises where the work will be
performed, including factories, cable stations and other such facilities, and
will use its best endeavors to secure rights of access to premises of its
subcontractors where the work will be performed, having subcontracts or orders
in the amount of, or equivalent to U.S. $125,000 or more, in accordance with the
Contractor's contractual arrangements with its Subcontractors, and allow the
Purchaser or its QA Representative to:

            1.    audit the Contractor's quality assurance system and its
                  application to the Work and Upgrade Work, including
                  manufacture, development and raw materials and components
                  provision;

            2.    inspect all parts of the Work and Upgrade Work to the extent
                  reasonably practicable to ensure that their quality meets the
                  Specification; and

            3.    perform activities with respect to cable stations and other
                  civil works such as, but not limited to, survey, installation,
                  commissioning, acceptance and other construction and/or
                  operational activities.
<PAGE>   69
                                                                              66

Each of the foregoing rights of access shall be conditional upon (i) Purchaser
giving Contractor reasonable notice, (ii) exercising such rights of access
during normal business hours and (iii) the Purchaser and/or the QA
Representatives accessing factories, cable stations and other such facilities in
a manner that avoids disruption of the work that is being performed on such
premises. The Purchaser shall provide the name(s) of each such visitor prior to
the visit. The Contractor shall not be responsible for any costs, including
travel and accommodation costs, of the Purchaser or its representatives.

      B. The right of access shall also allow for the Purchaser and/or its QA
Representatives to be aboard the vessel(s) during installation and the route
survey, provided accommodations are available. The Contractor shall not be
responsible for any costs of the Purchaser or its representatives, except for
living expenses on board the vessel which includes one (1) daily telex or fax,
all other travel and accommodation costs for the Purchaser or its QA
Representatives shall be for the account of the Purchaser.

      C. Any right of access shall not be construed as creating any obligation
requiring the Contractor or its subcontractors to disclose trade secrets or
proprietary information. Further, such right of access may be conditioned on the
execution of a confidentiality and non-disclosure agreement and/or subject to
routine building or security rules, regulations or procedures.

      D. Any exercise of any right of the Purchaser under this Contract to
inspect, audit, visit or to observe or to review or approve any part of the Work
or System Upgrades shall not be construed as limiting any obligation of
Contractor hereunder, including without limitation, under Articles 1 and 10
hereof.

      E. Contractor will have access to the System as necessary to accomplish
its responsibilities under this Contract and in order to make repairs and to
make System Upgrades. Contractor will provide reasonable notice of its need for
access and will take reasonable steps to minimize disruptions to the operation
of the System.

      F. Contractor shall give the Purchaser reasonable prior written notice of
each monthly project management review meeting with respect to the status of the
construction and/or installation of the System, and Purchaser's representatives
and the Independent Engineer shall at their cost be permitted to attend and
participate in such meetings.

ARTICLE 30  QUALITY ASSURANCE; FIRST APPLICATION

      A. All equipment, material and supplies provided under this Contract shall
be inspected and tested by representatives designated by the Contractor to the
extent reasonably practical to assure that the quality of the equipment,
materials and supplies being incorporated is sufficient to realize the System
Performance Requirements. The inspection and test program established for such
equipment, materials and supplies shall be consistent with commercial practices
normally employed by the Contractor in the construction of submarine cable
systems. The foregoing shall not be construed as limiting any of the
Contractor's obligations under this Contract.
<PAGE>   70
                                                                              67

      B. The Contractor represents that the list in Exhibit F identifies (i) all
major System elements and subsystems and (ii) all Deliverable Software, which
have not been used, as of the date hereof, in any other currently operating
submarine cable system, the qualification plans for which are more fully
described in the First Office Application section of the Quality Plan section of
the Technical Volume.

ARTICLE 31  DOCUMENTATION

            The Contractor shall furnish to the Purchaser one set of the
standard documentation in the English language for the System provided
hereunder. Such documentation shall be provided prior to the Acceptance testing.
Additional copies of the documentation are available at additional cost.

ARTICLE 32  TRAINING

            The Contractor will provide, as part of the Initial Contract Price,
any and all training, as more particularly described in the training section of
Appendix 6, necessary for the operation and maintenance of the System. Any
person who is to receive such training, prior to the receipt of such training,
shall be obligated to execute a confidentiality and non-disclosure agreement
containing terms substantially similar to Article 36.

ARTICLE 33  SETTLEMENT OF DISPUTES/ARBITRATION/LITIGATION

      A. The Parties shall endeavor to settle amicably by mutual discussions any
disputes, differences, or claims whatsoever related to this Contract.

      B. Failing such amicable settlement, any controversy, claim or dispute
arising under or relating to this Contract, including the existence, validity,
interpretation, performance, termination or breach thereof, shall, if both
Parties agree in writing thereto, finally be settled by arbitration in
accordance with the International Arbitration Rules of the American Arbitration
Association ("AAA"), taking into account the Japan American Trade Arbitration
Agreement, dated as of September 16, 1952. Unless the Parties agree to a sole
arbitrator, there shall be three (3) arbitrators, with each Party appointing one
arbitrator, who collectively will select a third. The language of the
arbitration shall be English. The Arbitrator will not have authority to award
punitive damages to either Party. Each Party shall bear its own expenses, but
the Parties shall share equally the fees and expenses of the Arbitration
Tribunal and the AAA. This Contract shall be enforceable, and any arbitration
award shall be final, and judgment thereon may be entered in any court of
competent jurisdiction. In any such arbitration, the decision in any prior
arbitration under this Contract shall not be deemed conclusive of the rights as
among themselves of the Parties hereunder. The arbitration shall be held in New
York, New York, U.S.A.

      C.    1.    If both Parties do not agree to arbitration pursuant to
                  paragraph (B) above, then either Party may institute suit in
                  the Supreme Court of the State of New York sitting in New York
                  County or the United States District Court of the Southern
                  District of New York, or any appellate court from any thereof.
<PAGE>   71
                                                                              68

            2.    Each Party hereby irrevocably and unconditionally submits to
                  the non-exclusive jurisdiction of any New York State or
                  Federal court sitting in The City of New York, and any
                  appellate court from any thereof, in any action or proceeding
                  arising out of or relating to this Contract, and each Party
                  hereby irrevocably and unconditionally agrees that all claims
                  in respect of such action or proceeding may be heard and
                  determined in such New York State court or, to the extent
                  permitted by law, in such Federal court. Each Party hereby
                  irrevocably and unconditionally waives, to the fullest extent
                  it may effectively do so, any defense of an inconvenient forum
                  to the maintenance of such action or proceeding in any such
                  court and any right of jurisdiction on account of the place of
                  residence or domicile of either Party. The Contractor hereby
                  irrevocably and unconditionally appoints CT Corporation System
                  (the "New York Process Agent"), with an office on the date
                  hereof at 111 Eighth Avenue, 13th Floor, New York, New York
                  10011, as its agent to receive on behalf of the Contractor and
                  its respective property service of copies of the summons and
                  complaint and any other process which may be served in any
                  such action or proceeding in any such New York State or
                  Federal court and agrees promptly to appoint a successor New
                  York Process Agent in The City of New York (which successor
                  Process Agent shall accept such appointment in a writing prior
                  to the termination for any reason of the appointment of the
                  initial New York Process Agent). In any such action or
                  proceeding in such New York State or Federal court sitting in
                  The City of New York, such service may be made on the
                  Contractor by delivering a copy of such process to the
                  Contractor in care of the appropriate Process Agent at such
                  Process Agent's above address and by depositing a copy of such
                  process in the mails by certified or registered air mail,
                  addressed to the Contractor at its address referred to in
                  Article 35 of this Contract (such service to be effective upon
                  such receipt by the appropriate Process Agent and the
                  depositing of such process in the mails as aforesaid). The
                  Contractor hereby irrevocably and unconditionally authorizes
                  and directs such Process Agent to accept such service on its
                  behalf. As an alternate method of service, the Contractor also
                  irrevocably and unconditionally consents to the service of any
                  and all process in any such action or proceeding in such New
                  York State or Federal court sitting in The City of New York by
                  mailing of copies of such process to the Contractor, as the
                  case may be, by certified or registered air mail at its
                  address referred to in Article 35 of this Contract. The
                  Contractor agrees that, to the fullest extent permitted by
                  applicable law, a final judgment in any such action or
                  proceeding shall be conclusive and may be enforced in other
                  jurisdictions by suit on the judgment or in any other manner
                  provided by law.

            3.    WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
                  FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY
                  HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
                  INDIRECTLY
<PAGE>   72
                                                                              69

                  ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
                  TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
                  TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
                  THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
                  HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
                  WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
                  FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
                  PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
                  BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
                  IN THIS PARAGRAPH.

      D. THE OBLIGATIONS OF EACH PARTY IN RESPECT OF THIS CONTRACT DUE TO ANY
PARTY SHALL, NOTWITHSTANDING ANY JUDGMENT IN A CURRENCY (THE "JUDGMENT
CURRENCY") OTHER THAN DOLLARS, BE DISCHARGED ONLY TO THE EXTENT THAT ON THE
BUSINESS DAY FOLLOWING RECEIPT BY SUCH PARTY OF ANY SUM ADJUDGED TO BE SO DUE IN
THE JUDGMENT CURRENCY SUCH PARTY MAY IN ACCORDANCE WITH NORMAL BANKING
PROCEDURES PURCHASE DOLLARS WITH THE JUDGMENT CURRENCY; IF THE AMOUNT OF DOLLARS
SO PURCHASED IS LESS THAN THE SUM ORIGINALLY DUE TO SUCH PARTY IN DOLLARS, EACH
PARTY AGREES, AS A SEPARATE OBLIGATION AND NOTWITHSTANDING ANY SUCH JUDGMENT, TO
INDEMNIFY SUCH PARTY AGAINST SUCH LOSS, AND IF THE AMOUNT OF DOLLARS SO
PURCHASED EXCEEDS THE SUM ORIGINALLY DUE TO ANY PARTY TO THIS CONTRACT, EACH
PARTY AGREES TO REMIT TO SUCH PARTY, SUCH EXCESS.

ARTICLE 34  APPLICABLE LAW

            THIS CONTRACT SHALL BE CONSTRUED AND GOVERNED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, UNITED STATES, EXCLUDING ITS CONFLICTS OF LAW
PROVISIONS AND EXCLUDING THE CONVENTION FOR THE INTERNATIONAL SALE OF GOODS.

ARTICLE 35  NOTICES

      A. Any notices, consent, approval, or other communication pursuant to this
Contract shall be in writing, in the English language, and shall be deemed to be
duly given or served on a Party if sent to the Party at the address stipulated
in Sub-Article 35(B) and if sent by any one of the following means only:

            1.    Sent by hand: Such communication shall be deemed to have been
                  received on the day of delivery provided receipt of delivery
                  is obtained.
<PAGE>   73
                                                                              70

            2.    Sent by facsimile: Such communication shall be deemed to have
                  been received, under normal service conditions, twenty-four
                  (24) hours following the time of dispatch or on confirmation
                  by the receiving Party, whichever is earlier.

            3.    Sent by an internationally recognized courier service: Such
                  communication shall be deemed to have been received, under
                  normal service conditions, on the day it was received or on
                  the third day after it was dispatched, whichever is earlier.

      B. For purposes of this Article, the names, addresses and fax numbers of
the Parties are as detailed below. Any change to the name, address, and
facsimile numbers may be made at any time by giving thirty (30) days prior
written notice.

Contractor:

KDD Submarine Cable Systems Inc.
KDD Building, 3-2, Nishi-shinjuku 2-chome
Shinjuku-ku, Tokyo 163-8525, Japan
Facsimile:  81-3-3347-7237
            81-3-3347-8462
Telephone:  81-3-3347-8460
Attn:  Tatsuhide Nagasawa, Managing Director, EAC Project Manager

Purchaser:

Asia Global Crossing Ltd.
Wessex House, 2nd Floor
45 Reed Street
Hamilton, HM12, Bermuda
Facsimile:  (441) 296-8606
Telephone: (441) 296-8600
Attn:  S. Wallace Dawson, Jr.

with a copy to the Independent Engineer.

ARTICLE 36  PUBLICITY AND CONFIDENTIALITY

      A. No information relating to this Contract shall be released by either
Party to any newspaper, magazine, journal or other written, oral or visual
medium without the prior written approval of an authorized representative of the
other Party; provided that, subject to Article 20 (Safeguarding of Information
and Technology) and the following Sub-Article, this Article shall not restrict
either Party from (i) responding to customary press inquiries or otherwise
making public or private statements in the normal course of business, so long as
consistent with a mutually agreed press-release and (ii) assisting in the
obtaining of financing in accordance with Sub-Article 37(C), including the
publication of a financial tombstone.
<PAGE>   74
                                                                              71

      B. This Contract and any non-public information, written or oral, with
respect to this Contract, "Confidential Information", will be kept confidential
and shall not be disclosed, in whole or in part, to any person other than
affiliates, officers, directors, employees, agents or representatives of a Party
(collectively, "Representatives") who need to know such Confidential Information
for the purpose of negotiating and executing this Contract. Each Party agrees to
inform each of its Representatives of the non-public nature of the Confidential
Information and to direct such persons to treat such Confidential Information in
accordance with the terms of this Article. Nothing herein shall prevent a Party
from disclosing Confidential Information (a) upon the order of any court or
administrative agency, (b) upon the request or demand of, or pursuant to any
regulation of, any regulatory agency or authority, (c) to the extent reasonably
required in connection with the exercise of any remedy hereunder, (d) to a
Party's legal counsel or independent auditors, (e) prospective lenders to the
Purchaser or Purchaser's parent or affiliate companies, (f) to the extent
required, to any actual or proposed person or entity which will provide any
operation, administrative or maintenance services with respect to the System or
any part thereof and (g) to any actual or proposed assignee of all or part of
its rights hereunder provided that such actual or proposed assignee agrees in
writing to be bound by the provisions of this Article.

ARTICLE 37  ASSIGNMENT

      A. Except as provided in this Article, neither Party shall assign this
Contract or any right or interest under this Contract, nor delegate any work or
obligation to be performed under this Contract ("Assignment"), without the other
Party's prior written consent which shall not be unreasonably withheld (it being
understood that it shall be deemed to be reasonable to withhold consent to the
assignment of this Contract or any rights, interest or obligations hereunder to
a competitor of Contractor or an affiliate of a competitor or uncreditworthy
party).

      B. The Contractor has the right to assign all or any part of its rights
under this Contract, or to delegate all or any part of its duties hereunder at
any time without the Purchaser's consent to a successor to substantially all the
assets of the Contractor by way of a merger, consolidation or sale of assets;
provided that in the case of any assignment or delegation pursuant to this
Sub-Article 37(B), such assignee or delegee shall assume in writing all
liabilities, warranties, representations and obligations of Contractor under
this Contract. The Contractor shall give the Purchaser written notice 30 days
prior to any assignment or delegation. Contractor shall remain jointly and
severally liable with any assignee or delegee described in this paragraph.

      C. The Parties acknowledge that Purchaser may finance construction of the
System on a "project finance" basis and that in connection therewith the
financing parties will require that such financing be secured by certain assets
of Purchaser (including but not limited to this Contract). The Purchaser may, in
connection with any such project financing grant a collateral assignment of the
System and/or its rights and obligations under this Contract to any such
financing parties, and in connection therewith, the Contractor will execute and
deliver a Consent, substantially in the form of Exhibit C hereto; provided that
Contractor agrees to make such changes or additions to such form as may be
reasonably requested by such financing parties and Purchaser, and such financing
parties may transfer in accordance with such Consent. Contractor will also
deliver an Opinion in the form of Exhibit D hereto, and a similar opinion of
Guarantor's
<PAGE>   75
                                                                              72

counsel with respect to the Guaranty, to Purchaser and such financing parties
and such other documents as are reasonably requested by such financing parties.

      D. The Purchaser has the right to assign all of its rights and delegate
all of its duties under this Contract to any other entity to whom all of
Purchaser's rights and interests in the System have been transferred. Purchaser
also has the right (i) to assign all of its rights hereunder with respect to any
particular Landing Assets to any Transferee, including the right to receive
invoices relating thereto, (ii) to assign Permits with respect to such Landing
Assets, or have Permits with respect to such Landing Assets issued in the name
of, such Transferee and (iii) to transfer such Landing Assets or have such
Landing Assets transferred directly to, such Transferee; provided that such
Transferee shall execute a supplement to this Contract whereby it becomes
jointly and severally liable, together with Purchaser, for all of Purchaser's
obligations under this Contract. "Landing Assets" means, with respect to each
jurisdiction where a portion of the System is located, all or part of such
portion of the System located therein. It is understood that the Purchaser, at
its option, may assign and transfer rights with respect to Landing Assets in
different jurisdictions to different Transferees. Purchaser contemplates
effecting the foregoing assignment pursuant to a Supplement substantially in the
form of Exhibit L hereto, and the Contractor agrees to execute and deliver such
Supplement. Purchaser shall not transfer any of its rights under this Contract
or the System except in accordance with the foregoing. Any assignment or
transfer by Purchaser not expressly permitted by Sub-Article 37(C) or (D) shall
be of no force and effect. Any assignment or transfer by Purchaser which results
in any increase in costs or any loss, damage, delay or failure of performance
shall constitute a Force Majeure, and, without limiting the applicability of
Article 17 (Force Majeure), Purchaser shall be responsible for any increase in
costs resulting therefrom.

     *

ARTICLE 38  RELATIONSHIP OF THE PARTIES

            All work performed by a Party under this Contract shall be performed
as an independent contractor and not as an agent of the other and no persons
furnished by a Party shall be considered the employees or agents of the other.
Each Party shall be responsible for its employees' compliance with all Laws
while performing under this Contract. This Contract shall not form a joint
venture or partnership between the Parties.

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.
<PAGE>   76
                                                                              73

ARTICLE 39  SUCCESSORS BOUND

            This Contract shall be binding on the Contractor and the Purchaser
and their respective successors and permitted assigns.

ARTICLE 40  ARTICLE CAPTIONS; JOINT DRAFTING

      A. The captions of the Articles do not form part of this Contract and
shall not have any effect on the interpretation thereof.

      B. This Contract has been fully negotiated between, and jointly drafted
by, the Parties hereto.

ARTICLE 41  SEVERABILITY

            If any of the provisions of this Contract shall be invalid or
unenforceable, such invalidity or unenforceability shall not invalidate or
render unenforceable the entire Contract, but rather the entire Contract shall
be construed as if not containing the particular invalid or unenforceable
provision or provisions and the rights and obligations of the Contractor and the
Purchaser shall be construed and enforced accordingly. In the event such invalid
or unenforceable provision is an essential and material element of this
Contract, the Parties shall promptly negotiate a replacement provision.

ARTICLE 42  GUARANTOR

            The Contractor agrees to cause the Guarantor to execute and deliver
the Guaranty to Purchaser within ten (10) days of the execution of this
Agreement.

ARTICLE 43  SURVIVAL OF OBLIGATIONS

            The Parties' rights and obligations, which, by their nature would
continue beyond the termination, cancellation or expiration of this Contract,
including, but not limited to, those contained in Sub-Article 4(B) (Taxes,
Levies and Duties) and Sub-Article 4(C) (Withholding Tax), Article 18
(Intellectual Property), Article 20 (Safeguarding of Information and
Technology), Article 21 (Export Control) and Article 23 (Limitation of
Liability/Indemnification) shall survive termination, cancellation or expiration
hereof. Article 10 (Warranty) and Article 11 (Contractor Support), shall survive
termination, cancellation or expiration hereof, if and only if, this Contract is
terminated by Purchaser pursuant to Sub-Article 13(A).

ARTICLE 44  NON-WAIVER

            A waiver of any of the terms and conditions of this Contract, or the
failure of either Party strictly to enforce any such term or condition, on one
or more occasions shall not be
<PAGE>   77
                                                                              74

construed as a waiver of the same or of any other term or condition of this
Contract on any other occasion.

ARTICLE 45  LANGUAGE

            This Contract has been executed in the English language and English
will be the controlling language for interpretation of this Contract.

ARTICLE 46  ENTIRE AGREEMENT

            This Contract supersedes all prior oral or written understanding
between the Parties and constitutes the entire agreement with respect to the
subject matter herein. Such terms and conditions shall not be modified or
amended except by a writing signed by authorized representatives of all Parties.
<PAGE>   78
                                                                              75

            This Contract is executed as of the date first set forth above in
the location set forth below the signature of the duly authorized representative
of each Party, as set forth below.

                                    KDD SUBMARINE CABLE SYSTEMS INC.

                                    By:______________________________________
                                       Name:
                                       Title:

                                    ASIA GLOBAL CROSSING LTD.

                                    By:______________________________________
                                       Name:
                                       Title:
<PAGE>   79
                                                                       EXHIBIT A
                                                        TO CONSTRUCTION CONTRACT

* Material omitted and separately filed with the Commission under an
  application for confidential treatment.

<PAGE>   80
                                                                     EXHIBIT B
                                                                          TO
                                                         CONSTRUCTION CONTRACT

                            FORM OF PARENT GUARANTY

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

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

                                   GUARANTY

                                      by

                                     [ ]

                                 in favor of

                        [NAME OF GLOBAL CROSSING SUB]

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

                               Dated as of [ ]

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

------------------------------------------------------------------------------
------------------------------------------------------------------------------
<PAGE>   81
            This GUARANTY, made as of [ ], 1999 by [_________________], a
[________] corporation (the "Guarantor"), in favor of [NAME OF GLOBAL CROSSING
SUB], a Bermuda corporation (the "Purchaser").

                                R E C I T A L S

            (A) Pursuant to the Project Development and Construction Contract
(as the same may from time to time be amended, modified or supplemented, the
"Contract") dated as of [
        ] between [ ], a [ ] corporation (together with any successor or
assignee under the Contract, the "Contractor"), and the Purchaser, the
Contractor has agreed to design, build and install the System.

            (B) The Purchaser has required, as a condition precedent to entering
into the Contract, that the Guarantor execute and deliver this Guaranty. The
Purchaser would not enter into the Contract with the Contractor but for the
execution and delivery of this Guaranty by the Guarantor.

            (C) In furtherance of the business purposes of the Guarantor, the
Guarantor desires to guaranty all of the obligations of the Contractor under the
Contract as provided herein.

            (D) The Guarantor is the owner either directly or indirectly of all
of the capital stock of the Contractor.

            NOW, THEREFORE, based upon the foregoing, and in order to induce the
Purchaser to enter into the Contract, the Guarantor hereby agrees as follows:

                                  ARTICLE 1

                                 Definitions

            Section 1.1. Definitions. Capitalized terms not otherwise defined in
this Guaranty shall have the meanings ascribed to them in the Contract. As used
in this Guaranty, the following terms have the following meanings unless the
context otherwise requires:

            "Guarantied Obligations" has the meaning ascribed to such term in
Section 2.1.

            "Guaranty" means this Guaranty, as it may be amended, supplemented
or otherwise modified from time to time in writing signed by the Guarantor and
the Purchaser.

                                  ARTICLE 2

                                 The Guaranty

            Section 2.1. The Guaranty. Except as expressly set forth herein, the
Guarantor hereby unconditionally guarantees to Purchaser the full and punctual
performance by Contractor
<PAGE>   82
                                                                               2

(i) of the Work required under the Contract (including Upgrade Work, when and if
an upgrade is ordered) and/or the payment of damages which become due, owing or
incurred under or in connection with the Contract (including, without
limitation, liquidated damages), for Contractor's failure to perform such Work,
(or Upgrade Work as the case may be) in each case subject to the limitations on
liability therefor expressly set forth in the Contract and (ii) of the covenants
and other obligations of the Contractor under the Contract (including all
warranties) (collectively, the "Guarantied Obligations"). The Guarantor and the
Purchaser expressly acknowledge that (i) subject to Section 2.5 below, default
by the Contractor or the failure of the Contractor to perform any Guarantied
Obligation in the time required in each case under the Contract is a condition
of the exercise of this Guaranty and (ii) in no event shall the Guarantied
Obligations exceed the Contractor's obligations and liabilities under the
Contract. If the Purchaser requests the Guarantor to perform any Guarantied
Obligation (other than the payment of money) the Guarantor may undertake to
satisfy such obligation by causing another qualified person to perform such
Guarantied Obligation or, in its sole discretion, by assigning such obligation
to a qualified party; provided, that such assignment shall not relieve the
Guarantor of any liability for the performance of such obligation unless and
until such obligation has been completely performed. The Guarantied Obligations
shall conclusively be deemed to have been created in reliance upon this
Guaranty.

            Section 2.2. Termination of Guaranty. Except as expressly set forth
herein, (a) this Guaranty shall remain in full force and effect with respect to
the Guarantied Obligations, including, without limitation, all obligations such
as covenants and warranties which survive completion of the Work and all
obligations under any supplements, extensions, amendments, Upgrades or Contract
Variations, until terminated in accordance with paragraph (b) below.

            (b) This Guaranty shall terminate with respect to each of the
Guarantied Obligations described below on the respective dates described below
(each a "Termination Date") subject to the survival of certain obligations and
liabilities as expressly described in the last paragraph (c) below:

                  (i) with respect to all Guarantied Obligations (except for any
      longer periods for those Guarantied Obligations described in clauses
      (b)(ii) and (b)(iii) below) on the date occurring ten (10) years after the
      Date of Provisional Acceptance of the System;

                  (ii) with respect to all Guaranteed Obligations relating to or
      in connection with Contractor's obligation to implement System Upgrades
      (including, without limitation, Contractor's warranties as to
      Upgradeability contained in Article 10(B)(ii) of the Contract), on the
      earlier of (A) the last date of the Upgrade Option Period or (B) the Date
      of Final Acceptance of the last possible System Upgrade provided for in
      the Contract; provided, that such Termination Date shall not limit any
      longer period with respect to any elected System Upgrade in accordance
      with clause (b)(iii) below; and
<PAGE>   83
                                                                               3

                  (iii) with respect to all Guarantied Obligations relating to
      or in connection with each System Upgrade elected during the Upgrade
      Option Period, on the date occurring ten (10) years after the Date of
      Provisional Acceptance of such System Upgrade.

            (c) If a Guarantied Obligation has become due, owing or performable
prior to the Termination Date relating to such Guarantied Obligation, then this
Guaranty shall continue only with respect to such Guarantied Obligation until
fully performed. For example:

                  (i) pursuant to Article 10(A) of the Contract, if a defect
      covered by the Warranty Period is identified in good faith just prior to
      the Termination Date set forth in clause (b)(i) above, the Guarantor's
      obligations under this Guaranty shall continue with respect to such
      Guarantied Obligation, not withstanding such Termination Date, until
      Contractor performs all of its obligations under the Contract with respect
      to such defect, or

                  (ii) if Purchaser elects a System Upgrade just prior to the
      Termination Date set forth in clause (b)(ii) above, Guarantor's obligation
      under this Guaranty shall continue with respect to such Guarantied
      Obligation, not withstanding such Termination Date, until Contractor
      performs all its obligations under the Contract with respect to such
      System Upgrade.

            (d) The Guarantor's performance or payment of a portion, but not
all, of the Guarantied Obligations shall in no way limit, affect, modify or
abridge the Guarantor's liability, as set forth herein, for any portion of the
Guarantied Obligations that has not been completely performed or paid in full.

            Section 2.3. Guaranty Unconditional. Except as expressly set forth
herein, the Guarantor agrees that the obligations of the Guarantor hereunder
shall be unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by any of the
following, whether with or without notice to or assent by the Guarantor:

                (i) any extension, renewal, settlement, compromise, waiver or
        release in respect of any obligation of the Contractor under the
        Contract, by operation of law or otherwise;

                (ii) any modification or amendment of or supplement to the
        Contract;

                (iii) any release, impairment, non-perfection or invalidity of
        any direct or indirect security for any obligation of the Contractor
        under the Contract;

                (iv) any change in the corporate existence, structure or
        ownership of the Contractor, or any insolvency, bankruptcy,
        reorganization or other similar proceeding
<PAGE>   84
                                                                               4

        affecting the Contractor or its assets or any resulting release or
        discharge of any obligation of the Contractor contained in the Contract;

                (v) the existence of any claim, set-off or other rights which
        the Guarantor may have at any time against the Contractor, the
        Purchaser, or any other corporation or person, whether in connection
        herewith or any unrelated transactions, provided that nothing herein
        shall prevent the assertion of any such claim by separate suit or
        compulsory counterclaim;

                (vi) any invalidity or unenforceability relating to or against
        the Contractor for any reason of the Contract, or any provision of
        applicable law or regulation purporting to prohibit the payment by the
        Contractor of any other amount payable by the Contractor under the
        Contract; or

                (vii) any other act or omission to act or delay of any kind by
        the Contractor, the Purchaser, or any other corporation or person or any
        other circumstance whatsoever which might, but for the provisions of
        this paragraph, constitute a legal or equitable discharge of or defense
        to the Guarantor's obligations hereunder.

Notwithstanding any provision of this Guaranty to the contrary, the Guarantor
shall be entitled to assert as a defense to any claim for payment or performance
of the Guarantied Obligations, that (i) such Guarantied Obligations are not
currently due under the terms of the Contract or (ii) that such Guarantied
Obligations have previously been paid or performed in full.

            Section 2.4. Waivers of Notices and Defenses. The Guarantor hereby
waives acceptance hereof, presentment, demand, protest and any notice not
provided for herein, as well as any requirement that at any time any action be
taken by any corporation or person against the Contractor or any other
corporation or person.

            Section 2.5. Stay. The Guarantor agrees that, notwithstanding
anything to the contrary herein, if the Purchaser is stayed upon the insolvency,
bankruptcy, or reorganization of the Contractor from exercising its rights to
enforce or exercise any right or remedy with respect to the Guarantied
Obligations, or is prevented from giving any notice or demand for payment or
performance or taking any action to realize on any security or collateral or is
prevented from collecting any of the Guarantied Obligations, in any such case,
by such proceeding or action, the Guarantor shall pay or render to the Purchaser
upon demand therefor the amount or performance that would otherwise have been
due had such rights and remedies been permitted to be exercised by the
Purchaser.

            Section 2.6. No Enforcement of Subrogation. Upon making any payment
or performance with respect to any Guarantied Obligation hereunder, the
Guarantor shall be subrogated to the rights of the Purchaser against the
Contractor with respect to such payment or performance; provided that the
Guarantor shall not enforce any payment or performance right by way of
subrogation until all Guarantied Obligations been paid and performed in full.
<PAGE>   85
                                                                               5

                                  ARTICLE 3

                        Representations and Warranties

            The Guarantor hereby represents and warrants to the Purchaser that
the following statements are true and correct:

            Section 3.1. Binding Obligation. This Guaranty has been duly and
validly executed and delivered by the Guarantor and constitutes the legal, valid
and binding obligations of the Guarantor enforceable against the Guarantor in
accordance with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors' rights generally and by equitable principles relating to the
availability of equitable remedies.

            Section 3.2. Relationship to the Contractor. As of the date hereof,
the Guarantor is the owner, directly or through one or more wholly-owned
subsidiaries, of all of the issued and outstanding capital stock of the
Contractor; the agreement of the Purchaser to enter into the Contract with the
Contractor is of substantial and material benefit to the Guarantor; and the
Guarantor has reviewed and approved copies of the Contract and all other related
documents and is fully informed of the remedies the Purchaser may pursue upon
the occurrence of a default under the Contract. This Guaranty will remain in
full force and effect if Contractor ceases to be a direct or indirect subsidiary
of Guarantor.

        Section 3.3. Status. Guarantor is a corporation duly organized and
existing under the laws of Bermuda.

                                  ARTICLE 4

                                Miscellaneous

            Section 4.1. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, facsimile
transmission, telex or similar writing) and shall be given to such party at its
address, telecopy number or telex number set forth, in the case of the
Guarantor, on the signature pages hereof, or in the case of the Purchaser, in
the Contract, or such other address or telecopy number or telex number as such
party may hereafter specify for the purpose by notice to the other party. Each
such notice, request or other communication shall be effective (i) if given by
facsimile transmission, when such telecopy is transmitted to the telecopy number
specified in this Section, (ii) if given by telex, when such telex is
transmitted to the telex number specified in this Section and the appropriate
answerback is received, (iii) if given by mail, three business days after such
communication is deposited in the mails with first class (or, in the case of
international mail, airmail) postage prepaid, addressed
<PAGE>   86
                                       6

as aforesaid, or (iv) if given by any other means, when delivered at the address
specified in this Section.

            Section 4.2. No Waivers. No failure or delay by the Purchaser in
exercising any right, power or privilege hereunder or under the Contract shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.

            Section 4.3. Amendments and Waivers. This Guaranty constitutes the
complete agreement of the Purchaser and the Guarantor with respect to the
subject matter hereof and supersedes all prior or contemporaneous negotiations,
promises, covenants, agreements or representations. No amendment, modification,
termination or waiver of any provision of this Guaranty, shall in any event be
effective without the written consent of the Purchaser and Guarantor.

            Section 4.4. Successors and Assigns; Beneficiaries. This Guaranty is
a continuing Guaranty and shall be binding upon the Guarantor and its successors
and assigns, provided, however, that the Guarantor may not assign this Guaranty
or transfer any of the rights or obligations of the Guarantor hereunder without
the prior written consent of the Purchaser and a majority of the lenders
referred to below. This Guaranty shall inure to the benefit of (i) the Purchaser
and its successors and assigns permitted under the Contract, (ii) any
"Transferee" under Article [ ] of the Contract and its successors and assigns
permitted under the Contract, (iii) any lenders participating in the financing
of the System to which the Purchaser assigns its rights hereunder and (iv) any
of the successors, assigns and transferees of such lenders to whom the Contract
has also been assigned in accordance with the terms of any consent to the
assignment of the Contact executed by Contractor. Nothing contained in this
Guaranty shall be deemed to confer upon anyone other than the parties hereto and
the other beneficiaries described in the preceding sentence any right to insist
upon or to enforce the performance or observance of any of the obligations
contained herein. If requested by the Purchaser, the Guarantor will execute and
deliver a consent, in a form reasonably requested by such lenders, to such
assignment in favor of such lenders.

            Section 4.5. Limitation on Liability. Notwithstanding anything to
the contrary contained or implied herein, except as otherwise agreed by
Guarantor and Purchaser, the aggregate liability for payment by Guarantor
hereunder shall not in any event exceed the maximum aggregate liability set
forth in Sub-Article 23(B) of the Contract, as such amount may be increased or
decreased pursuant to such Article, less amounts previously paid as damages
under the Contract to the Purchaser and/or its successors and assigns by
Contractor.

            Section 4.6. Applicable Law. This Guaranty shall be governed by and
construed in accordance with the laws of the State of New York.
<PAGE>   87
                                                                               7

            SECTION 4.7.  JURISDICTION.

            (a)         ANY ACTION OR PROCEEDING AGAINST THE GUARANTOR RELATING
                        IN ANY WAY TO THIS GUARANTY MAY BE BROUGHT AND ENFORCED
                        IN THE COURTS OF THE STATE AND CITY OF NEW YORK OR THE
                        UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
                        THE GUARANTOR IRREVOCABLY CONSENTS TO THE JURISDICTION
                        OF EACH SUCH COURT IN RESPECT OF ANY SUCH ACTION OR
                        PROCEEDING. THE GUARANTOR IRREVOCABLY APPOINTS [ ],
                        WHICH CURRENTLY MAINTAINS AN OFFICE IN THE CITY OF NEW
                        YORK, AS ITS AGENT TO RECEIVE SERVICE OF PROCESS OR
                        OTHER LEGAL SUMMONS FOR PURPOSES OF ANY SUCH ACTION OR
                        PROCEEDING. THE GUARANTOR FURTHER IRREVOCABLY CONSENTS
                        TO THE SERVICE OF PROCESS IN ANY SUCH ACTION OR
                        PROCEEDING BY THE MAILING OF COPIES THEREOF BY
                        REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, RETURN
                        RECEIPT REQUESTED, TO THE GUARANTOR AT ITS ADDRESS AS
                        PROVIDED FOR NOTICES HEREUNDER. THE FOREGOING SHALL NOT
                        LIMIT THE RIGHT OF THE PURCHASER TO SERVE PROCESS IN ANY
                        OTHER MANNER PERMITTED BY LAW OR TO BRING ANY ACTION OR
                        PROCEEDING, OR TO OBTAIN EXECUTION OF ANY JUDGMENT, IN
                        ANY OTHER JURISDICTION.

            (b)         THE GUARANTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION
                        THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
                        OF ANY ACTION OR PROCEEDING ARISING UNDER THIS GUARANTY
                        IN ANY COURT LOCATED IN THE STATE AND CITY OF NEW YORK
                        AND HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY
                        COURT LOCATED IN THE STATE OF NEW YORK IS NOT A
                        CONVENIENT FORUM FOR ANY SUCH ACTION OR PROCEEDING.

            SECTION 4.8. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY IRREVOCABLY
WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED UPON, OR ARISING OUT OF, THIS GUARANTY OR ANY OTHER RELATED DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS OR ACTIONS OF THE PURCHASER
OR THE GUARANTOR RELATING THERETO.

            Section 4.9. Judgment. The obligations of the Guarantor in respect
of this Guaranty due to any party hereto shall, notwithstanding any judgment in
a currency (the "judgment currency") other than Dollars, be discharged only to
the extent that on the Business
<PAGE>   88
                                       8

Day following receipt by such party of any sum adjudged to be so due in the
judgment currency such party may in accordance with normal banking procedures
purchase Dollars with the judgment currency; if the amount of Dollars so
purchased is less than the sum originally due to such party in Dollars, the
Guarantor agrees, as a separate obligation and notwithstanding any such
judgment, to indemnify such party against such loss, and if the amount of
Dollars so purchased exceeds the sum originally due to any party to this
Guaranty, such party agrees to remit to the Guarantor, such excess.

            Section 4.10. Severability. If any provision in or obligation under
this Guaranty shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.

            Section 4.11. Interpretation. Section headings in this Guaranty are
included herein for convenience of reference only and shall not constitute a
part of this Guaranty for any other purpose or be given any substantive effect.

            Section 4.12. Further Assurances. At any time or from time to time,
upon the request of the Purchaser, the Guarantor shall execute and deliver such
further documents and do such other acts and things as the Purchaser may
reasonably request in order to effect fully the purposes of this Guaranty. The
Guarantor agrees to be liable for any reasonable expenses incurred by Purchaser
and/or its successors and assigns with respect to any action or proceeding to
enforce this Guaranty. The Guarantor agrees to deliver an opinion of counsel
satisfactory to the Purchaser, addressed to the Purchaser and the lenders
described in Section 4.4(iii) hereof substantially in the form of Exhibit [ ] to
the Contract.
<PAGE>   89
                                                                               9

            IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of
the date first above written.

                                        [__________________________]

                                        By  ________________________
                                            Name:
                                            Title:

                                        Address: ___________________
<PAGE>   90
                                                                     EXHIBIT C
                                                                            TO
                                                         CONSTRUCTION CONTRACT

                         FORM OF CONSENT AND AGREEMENT

            CONSENT AND AGREEMENT, dated as of _________ __, 1999 (this
"Consent"), among [___________________], a [corporation] organized and existing
under the laws of ___________ (together with its successors and assigns, the
"Contractor"), [ADMINISTRATIVE AGENT], as administrative agent for the Lenders
referred to below (in such capacity, the "Administrative Agent"),
[________________] [a [corporation] organized and existing under the laws of
Bermuda (the "Borrower") and [Terminal Party(ies)] (together with the Borrower,
the "Purchasers").

                             W I T N E S S E T H:

            WHEREAS, the Borrower proposes to develop, construct, own, provide,
operate and sell capacity on a fiber optic cable system consisting of
[______________] and such other connections as the Supply Contract allows the
Borrower to elect (the "System") and, in connection therewith, the Borrower has
requested the Contractor to design, construct and install all components of the
System in accordance with the terms and conditions contained in the Project
Development and Construction Contract, dated as of _____ __, 1999 (as amended,
supplemented or otherwise modified from time to time, the "Supply Contract"),
between the Contractor and the Purchasers;

            [Describe any other assigned agreements and define them, together
with the Supply Contract, as the "Assigned Agreements"]

            WHEREAS, in order to finance the construction and installation of
the System, the Borrower is entering into a Credit Agreement, dated as of
____________ __, 1999 (as amended, supplemented or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, the Administrative Agent,
and the banks and financial institutions from time to time parties thereto as
lenders (collectively, the "Lenders");

            WHEREAS, as collateral security for all obligations of the Borrower
to the Lenders, the Borrower, and the other Purchasers, among other things, have
assigned or will assign all of their right, title and interest (the "Assigned
Interest") in, to and under the Assigned Agreements to the Administrative Agent
pursuant to the Borrower Security Agreement, dated as of ___________ __, 1999
(as amended, supplemented or otherwise modified from time to time, the "Security
Agreement"), made by the Borrower in favor of the Administrative Agent and the
other Security Agreements (as defined in the Credit Agreement); and
<PAGE>   91
                                       11

            WHEREAS, it is a condition precedent to the effectiveness of the
Credit Agreement that the Contractor and the other parties hereto shall have
executed and delivered this Consent;

            NOW, THEREFORE, in consideration of the foregoing premises and for
good and valuable consideration, the receipt of which is hereby acknowledged,
and intending to be legally bound, the parties hereto hereby agree,
notwithstanding anything to the contrary contained in the Assigned Agreements,
as follows:

            1. Consent to Assignment. The Contractor (a) consents to the
assignment as collateral security to the Administrative Agent, for the benefit
of the Lenders, of the Assigned Interest and (b) acknowledges the right of the
Administrative Agent in the exercise of its rights and remedies under the
Security Agreements to make all demands, give all notices, take all actions and
exercise all rights of the Borrower under the Assigned Agreements; provided,
that insofar as the Administrative Agent exercises any of its rights under the
Assigned Agreements or makes any claims with respect to payments or other
obligations under the Assigned Agreements, the terms and conditions of the
Assigned Agreements applicable to such exercise of rights or claims shall apply
to the Administrative Agent to the same extent as to each Purchaser.

            2. Borrower's Acknowledgment. Each Purchaser acknowledges and agrees
that the Contractor is authorized to act in accordance with the Administrative
Agent's exercise of the Borrower's rights in accordance with this Consent, and
that the Contractor shall bear no liability to any Purchaser in connection
therewith.

            3. Subsequent Transferee. The Contractor agrees that, if the
Administrative Agent shall notify the Contractor in writing (a copy of which
notice the Administrative Agent agrees to deliver simultaneously to the
Purchasers) that an Event of Default under the Credit Agreement has occurred and
is continuing and that the Administrative Agent has elected to exercise its
rights and remedies pursuant to the Security Agreements with respect to the
foreclosure or sale of the Assigned Interest, then the Administrative Agent or
any purchaser of the Assigned Interest, if the Administrative Agent or such
purchaser, as the case may be, has elected to assume all of the rights and
obligations of the Purchasers under the Assigned Agreements (a "Subsequent
Transferee"), shall (whether or not the Administrative Agent shall have
delivered a copy of the above-mentioned notice to the Purchasers and without
relieving the Administrative Agent of its obligation to do so) be substituted
for the Purchasers under such Assigned Agreements; provided that in the case of
a purchaser of the Assigned Interest, such purchaser (i) if such Event of
Default shall have occurred prior to the Date of Final Acceptance of the System,
is not and is not an affiliate of any entity engaged in the business of
designing or constructing undersea cable systems for telecommunications;
provided that such purchaser shall not request any System Upgrades, and (ii) if
such Event of Default shall have occurred prior to the Date of Final Acceptance
of the System, is sufficiently creditworthy to fulfill the obligations under the
Assigned Agreements. Upon any transfer by the Administrative Agent of the
Assigned Interest to a Subsequent Transferee, the Administrative Agent and the
Lenders shall have no
<PAGE>   92
                                                                              12

obligations under the Assigned Agreements, except to the extent any such entity
is a Subsequent Transferee.

            4. Right to Cure. In the event of a default by the Purchasers in the
performance of any of their obligations under any Assigned Agreement, or upon
the occurrence or non occurrence of any event or condition under such Assigned
Agreement which would immediately or with the passage of any applicable grace
period or the giving of notice, or both, enable the Contractor to terminate such
Assigned Agreement (hereinafter, a "default"), the Contractor will not terminate
such Assigned Agreement until it first gives written notice of such default to
the Administrative Agent and affords the Administrative Agent a period of at
least 45 days from receipt of such notice to cure such default.

            5. Replacement Agreement. In the event any Assigned Agreement is
terminated as a result of any bankruptcy or insolvency proceeding affecting the
Purchasers, the Contractor will, at the option of the Administrative Agent
exercised within 45 days after such termination, provided that all defaults
under the Assigned Agreements (other than such insolvency event) shall have been
cured, enter into a new agreement with the Administrative Agent or its
transferee or nominee having identical terms other than as necessitated by the
substitution of parties and other changes as the parties may agree; provided
that in the case of a transferee or nominee, such transferee or nominee (i) if
such termination shall have occurred prior to the Date of Final Acceptance of
the System, is not and is not an affiliate of any entity engaged in the business
of designing or constructing undersea cable systems for telecommunications;
provided that such transferee or nominee shall not request any System Upgrades
and (ii) if such termination shall have occurred prior to the Date of Final
Acceptance of the System, is sufficiently creditworthy to fulfill the
obligations under the Assigned Agreements.

            6. No Liability. The Contractor acknowledges and agrees that neither
the Administrative Agent nor any Lender (nor any other representative of any
Lender) shall have any liability or obligation under the Assigned Agreements as
a result of this Consent, the Security Agreements or the Credit Agreement, nor
shall the Administrative Agent, any Lender or any other representative of any
Lender (except during any period in which such person has elected to become a
Subsequent Transferee pursuant to Sections 3 and 5) be obligated or required to
perform any of the Purchasers' obligations under the Assigned Agreements or to
take any action to collect or enforce any claim for payment assigned under the
Security Agreements.

            7. Representations and Warranties. The Contractor hereby represents
and warrants, for the benefit of the Administrative Agent and the Lenders, that:

            (a) this Consent and each Assigned Agreement is in full force and
      effect, has been duly executed and delivered on behalf of the Contractor,
      and constitutes a valid and binding obligation of the Contractor
      enforceable against the Contractor in accordance with its terms except as
      enforceability may be limited by general principles of equity and by
      applicable bankruptcy, insolvency, reorganization, moratorium or similar
      laws affecting the rights of creditors generally;
<PAGE>   93
                                                                              13

            (b) no consent, license, approval or authorization of, or filing,
      registration or declaration with, or exemption by, any governmental body,
      bureau or agency or any other person is required in connection with the
      execution, delivery and performance by the Contractor of this Consent or
      any of the Assigned Agreements, except as provided in the express terms of
      the Assigned Agreements and other than those which have been duly obtained
      and are in full force and effect;

            (c) except pursuant to this Consent and as expressly set forth in
      the Assigned Agreements, the Contractor has not consented to any pledge,
      assignment or other transfer of any interest in the Assigned Agreements;
      and

            (d) the Contractor has the corporate power and is duly authorized to
      enter into this Consent and the Assigned Agreements and the execution,
      delivery and performance of this Consent and each of the Assigned
      Agreements does not violate the charter or bylaws of the Contractor or any
      law applicable to the Contractor or any contract material to the
      Contractor or the Assigned Agreements.

            8. GOVERNING LAW. THIS CONSENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED
STATES OF AMERICA.

            9. Submission to Jurisdiction. The parties hereto submit to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this Consent
or the transactions contemplated hereby. The parties hereto irrevocably waive,
to the fullest extent permitted by law, any objection which it may now or
hereafter have to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum.

            10. Counterparts. This Consent may be executed in any number of
counterparts, all of which together shall constitute a single instrument, and it
shall not be necessary that any counterpart be signed by all the parties hereto.

            11. Severability. Any provision of this Consent that may be
determined by competent authority to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

            12. Amendment, Waiver. Neither this Consent nor any of the terms
hereof may be terminated, amended, supplemented, waived or modified except by an
instrument in writing signed by the Contractor, the Purchasers and the
Administrative Agent.
<PAGE>   94
                                                                              14

            13. Notices. All notices and other communications required or
permitted by the terms hereof shall be in writing and shall be given in person
or by means of telecopy (promptly followed by delivery in person, by mail or by
courier in the case of a notice of default) or other wire transmission, or
mailed by registered or certified mail, or sent by courier, in each case
addressed as follows or to such other address as any party may designate by
written notice to the other parties:

The Borrower and the Purchasers:

            [----------------------]
            Wessex House
            45 Reid Street
            Hamilton HM12
            Bermuda
            Fax:  441-296-6749/8606
            Attn:  Corporate Counsel

The Contractor:

            [----------------------]

            Fax:

The Administrative Agent:

            [ADMINISTRATIVE AGENT],
              as Administrative Agent
            [Address]
            Attn:
            Fax:

Any such communication shall become effective when delivered by hand, or three
days after being deposited in the mail, first class postage prepaid, or, in the
case of an internationally recognized overnight courier service, one Business
Day after delivery to such courier service, or, in the case of transmission by
telecopier, when confirmation of receipt is obtained.

            14. Third Party Beneficiaries. This Consent and the representations,
covenants and agreements contained herein are and shall be held to be for the
sole benefit of the parties hereto and the Lenders, and the respective
successors and assigns of the Lenders.
<PAGE>   95
                                                                              15

            IN WITNESS WHEREOF, the parties have caused this Consent to be duly
executed and delivered by their officers thereunto duly authorized as of the
date first above written.

                                  [CONTRACTOR]

                                  By:
                                  Name:
                                  Title:

                                  [ADMINISTRATIVE AGENT], as Administrative
                                  Agent

                                  By:
                                  Name:
                                  Title:

                                  By:
                                      Name:
                                      Title:

                                  [PURCHASER]

                                  By:
                                      Name:
                                      Title:

                                  [TERMINAL PARTY(IES)]

                                  By:
                                         Name:
                                         Title:

<PAGE>   96
                                                                   EXHIBIT D-1
                                                                            TO
                                                         CONSTRUCTION CONTRACT

                         FORM OF CONTRACTOR OPINION(1)

                                                      DATE

Re:   [____________] Crossing Cable System

Asia Global Crossing Ltd.
Wessex House, 2nd Floor
45 Reed Street
Hamilton, HM12, Bermuda

[Administrative Agent],
as Administrative Agent, and the banks
listed on Schedule A hereto

Dear Sirs:

            We have participated in the preparation of the Project Development
and Construction Contract dated ______ __, 1999 between [________________] (the
"Contractor") and [________________] (the "Purchaser"), and the Consent and
Agreement dated as of ________ __, 1999 among the Contractor, [Administrative
Agent], as Administrative Agent, and the Purchaser (collectively, the
"Agreements"), and have acted as counsel for Contractor for the purpose of
rendering this opinion.

            Upon the basis of the foregoing and subject to the qualifications
set forth below, we are of the opinion that:

            1. The Contractor has been duly incorporated and is validly existing
      as a corporation in good standing under the laws of the State of
      [________________].

            2. The Agreements have been duly authorized, executed and delivered
      by the Contractor.

            3. Each of the Agreements constitutes a valid and binding agreement
      of the Contractor, enforceable against the Contractor in accordance with
      its terms, subject to the

--------
(1) Counsel may include usual, standard qualifications.
<PAGE>   97
                                                                               2

      effect of applicable bankruptcy, insolvency or similar laws affecting
      creditors' rights generally and equitable principles of general
      applicability.

            4. The execution, delivery and performance by the Contractor of each
      of the Agreements and the consummation of the transactions contemplated
      thereby by the Contractor will not violate or conflict with any laws,
      rules or regulations applicable to the Contractor or any provision of the
      Certificate of Incorporation or the Bylaws of the Contractor or, to my
      knowledge without independent investigation, any agreement binding on the
      Contractor.

            5. The execution and delivery of the Agreements by the Contractor,
      the consummation by the Contractor of the transactions provided for in the
      Agreements and the performance of or compliance with the obligations
      specified in the Agreements do not result in or constitute a violation of
      or default pursuant to any orders, judgments or decrees of which we have
      knowledge to which the Contractor is a party or by which the Contractor or
      its assets are bound.

      [The foregoing opinion is subject to the following qualifications:

            1. We express no opinion as to any indemnification or exculpation
      provisions in any of the Agreements that purport to indemnify any person
      or entity for or relieve any person or entity of responsibility for its
      own gross negligence or willful misconduct or insofar as any of said
      provisions contravene public policy.

            2. We express no opinion as to any provision in any of the
Agreements providing for liquidated damages or extended payment charges to the
extent any such provision is determined to be a penalty provision.

            3. In rendering the foregoing opinion, we have, with your consent
and without independent investigation, assumed that the Agreements have been
duly authorized, executed and delivered by the each of the parties thereto and
constitute valid and binding agreements of each of the parties thereto (other
than the Contractor).

            [The foregoing opinion or opinions should cover the laws of Japan,
New York and the Federal laws of the United States of America. Two separate
opinions are acceptable.]
<PAGE>   98
                                                                          3

            This opinion is being rendered to Asia Global Crossing Ltd.,
[Administrative Agent], as Administrative Agent, and the banks listed on
Schedule A hereto and may not, except as may be required by law or regulatory
authority, be distributed to any other person or entity and may not be relied
upon by any other person or entity without our prior written consent.

                                          Very truly yours,

                                          [CONTRACTOR'S COUNSEL]
<PAGE>   99
                                  Schedule A
                                      to
                             Contractor's Opinion

[To be provided.]
<PAGE>   100
                                                                   EXHIBIT D-2
                                                                            TO
                                                         CONSTRUCTION CONTRACT

                          FORM OF GUARANTOR OPINION(1)

                                                      DATE

Re:   [____________] Crossing Cable System

Asia Global Crossing Ltd.
Wessex House, 2nd Floor
45 Reed Street
Hamilton, HM12, Bermuda

[Administrative Agent],
as Administrative Agent, and the banks
listed on Schedule A hereto

Dear Sirs:

            We have participated in the preparation of the Guaranty dated as of
________ __, 1999 among the Contractor, the Guarantor and the Purchaser (the
"Guaranty"), and have acted as counsel for the Guarantor for the purpose of
rendering this opinion.

            Upon the basis of the foregoing and subject to the qualifications
set forth below, we are of the opinion that:

            1. The Guarantor has been duly incorporated and is validly existing
      as a corporation in good standing under the laws of Japan.

            2. The Guaranty has been duly authorized, executed and delivered by
      the Guarantor.

            3. The Guaranty constitutes a valid and binding agreement of the
      Guarantor, enforceable against the Guarantor in accordance with its terms,
      subject to the effect of applicable bankruptcy, insolvency or similar laws
      affecting creditors' rights generally and equitable principles of general
      applicability.

_________
(1)     Counsel may include usual, standard qualifications.
<PAGE>   101
                                                                          2

            4. The execution, delivery and performance by the Guarantor of the
      Guaranty and the consummation of the transactions contemplated thereby by
      the Guarantor will not violate or conflict with any laws, rules or
      regulations applicable to the Guarantor or any provision of the
      Certificate of Incorporation or the Bylaws of the Guarantor or, to my
      knowledge without independent investigation, any agreement binding on the
      Guarantor.

            5. The execution and delivery of the Guaranty by the Guarantor, the
      consummation by the Guarantor of the transactions provided for in the
      Guaranty and the performance of or compliance with the obligations
      specified in the Guaranty do not result in or constitute a violation of or
      default pursuant to any orders, judgments or decrees of which we have
      knowledge to which the Guarantor is a party or by which the Guarantor or
      its assets are bound.

      [The foregoing opinion is subject to the following qualifications:

            1. We express no opinion as to any indemnification or exculpation
      provisions in Guaranty that purport to indemnify any person or entity for
      or relieve any person or entity of responsibility for its own gross
      negligence or willful misconduct or insofar as any of said provisions
      contravene public policy.

            2. We express no opinion as to any provision in any of the Guaranty
      providing for liquidated damages or extended payment charges to the extent
      any such provision is determined to be a penalty provision.

            3. In rendering the foregoing opinion, we have, with your consent
      and without independent investigation, assumed that the Guaranty has been
      duly authorized, executed and delivered by each of the parties thereto and
      constitutes a valid and binding agreement of each of the parties thereto
      (other than the Guarantor).

            [The foregoing opinion or opinions should cover the laws of Japan,
      New York and the Federal laws of the United States of America. Two
      separate opinions are acceptable.]
<PAGE>   102
                                                                          3

            This opinion is being rendered to Asia Global Crossing Ltd.,
[Administrative Agent], as Administrative Agent, and the banks listed on
Schedule A hereto and may not, except as may be required by law or regulatory
authority, be distributed to any other person or entity and may not be relied
upon by any other person or entity without our prior written consent.

                                                Very truly yours,

                                                [GUARANTOR'S COUNSEL]
<PAGE>   103
                                  Schedule A
                                      to
                              Guarantor's Opinion

[To be provided.]
<PAGE>   104
                                                                     EXHIBIT E
                                                                            TO
                                                         CONSTRUCTION CONTRACT

                           FORM OF ESCROW AGREEMENT

                          [________________] CROSSING

            ESCROW AGREEMENT dated as of ______ __, 1999 by and among
[________________ Crossing Ltd.], a [corporation] organized and existing under
the laws of Bermuda (the "Purchaser"), [________________], a [corporation]
organized and existing under the laws of [________________], and having an
office in [________________] (the "Contractor") and [________________] (the
"Escrow Agent").

                             W I T N E S S E T H :

            WHEREAS, pursuant to the Project Development and Construction
Contract, dated as of ________ ___, 1999 (said agreement, as the same may be
amended, modified or supplemented from time to time, the "Supply Contract"),
between the Purchaser and the Contractor, there is required to be deposited by
Purchaser in escrow certain payments to be held by the Escrow Agent subject to
the terms and conditions set forth herein.

            NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants hereinafter set forth, the parties hereto agree as follows:

            The Purchaser and the Contractor do hereby appoint and designate the
Escrow Agent as escrow agent for the purposes set forth herein, and the Escrow
Agent does hereby accept such appointment under the terms and conditions set
forth herein.

            1. Establishment of Dispute Account. The Purchaser and the
Contractor hereby establish and, at all times until this Escrow Agreement is
terminated, shall maintain, with the Escrow Agent an escrow account (the
"Dispute Account"), in the name of and under the control of [________________]
as Escrow Agent, in which the Purchaser shall deposit payments (if and when)
made pursuant to Sub-Articles 5(C)(4) of the Supply Contract (the "Disputed
Payments"). Such funds shall be delivered to, and held by the Escrow Agent in,
the Escrow Agent's account set forth in Exhibit C hereto. The Escrow Agent shall
hold, subject to the terms and conditions hereof, such cash and such investments
and reinvestments as may be permitted pursuant to Section 2 hereof (which,
together with the income from such investments, are hereinafter, referred to as
the "Dispute Fund"). If any withholding tax is required to be paid from amounts
in the Dispute Fund, the Contractor and the Purchaser shall deliver to the
Escrow Agent any necessary and appropriate forms instructing the Escrow Agent as
to the amount and timing of such payments.
<PAGE>   105
                                                                          2

            2. Investment of Dispute Fund. During the term of this Escrow
Agreement, the Dispute Fund shall be invested and reinvested by the Escrow Agent
in interest-bearing or money market bank accounts of the Escrow Agent and such
other investments as the Contractor and the Purchaser may mutually agree upon
from among the Permitted Investments described on Exhibit D. In the absence of
any instruction, the Escrow Agent shall invest and reinvest the Dispute Fund in
its sole discretion in interest-bearing or money market bank accounts of the
Escrow Agent. All interest or other income earned under the Escrow Agreement
shall be allocated and paid as provided herein and reported by the recipient to
the Internal Revenue Service as having been so allocated and paid.

            In addition, the Escrow Agent shall have the right to liquidate any
investments held in order to provide funds necessary to make required payments
under this Escrow Agreement. The Escrow Agent in its capacity as escrow agent
hereunder shall not have any liability for any loss sustained as a result of any
investment made pursuant to the instructions of the parties hereto or as a
result of any liquidation of any investment prior to its maturity or for the
failure of the parties to give the Escrow Agent instructions to invest or
reinvest the Dispute Fund or any earnings thereon. Costs incurred by the Escrow
Agent in connection with the making or liquidation of any investment of the
Dispute Fund may be charged by the Escrow Agent against amounts in the Dispute
Fund if such costs are not paid when due.

            3. Dispositions. All or a portion of the Dispute Fund shall be paid
to (i) the Contractor account as set forth in Exhibit A upon the receipt by the
Escrow Agent of a written instruction from the Contractor to do so and
countersigned by the Purchaser, (ii) the Purchaser's account as set forth in
Exhibit B upon the receipt by the Escrow Agent of a written instruction from the
Purchaser to do so and countersigned by the Contractor, (iii) the account of the
prevailing party, if the dispute underlying the Disputed Payments is submitted
to arbitration in accordance with the Supply Contract, and upon receipt by the
Escrow Agent of a written instruction of the arbitrators directing the Escrow
Agent to do so or (iv) the account of the prevailing party, if the dispute
underlying the Disputed Payments is submitted to a court of competent
jurisdiction in accordance with the Supply Contract, and upon receipt by the
Escrow Agent of a final order or determination (no longer capable of being
appealed) from such court (or appellate court) setting forth the resolution of
such dispute and directing the Escrow Agent to do so. The Escrow Agent shall pay
amounts to the Contractor or the Purchaser, as the case may be, in accordance
with such written instruction, order or determination on (A) the business day
that such instruction, order or determination is received in the case of an
instruction, order or determination received by the Escrow Agent by no later
than 12:00 noon, New York City time or (B) the next business day in the case of
an instruction, order or determination received by the Escrow Agent after 12:00
noon, New York City time. All written instructions, orders or determinations may
be delivered by facsimile transmission to the Escrow Agent.

            4. The Escrow Agent may rely and shall be protected in acting or
refraining from acting upon any written notice, order, determination,
instruction or request furnished to it hereunder and believed by it to be
genuine and to have been signed or presented by the proper
<PAGE>   106
                                                                          3

party or parties. The Escrow Agent shall be under no duty to inquire into or
investigate the validity, accuracy or content of any such document. The Escrow
Agent shall have no duty to solicit any payments which may be due it hereunder.

            5. The Escrow Agent shall not be liable for any action taken by it
in good faith and believed by it to be authorized or within the rights or powers
conferred upon it by this Agreement, and may consult with counsel of its own
choice and shall have full and complete authorization and protection for any
action taken or suffered by it hereunder in good faith and in accordance with
the opinion of such counsel unless a court of competent jurisdiction determines
that the Escrow Agent's gross negligence or willful misconduct was the cause of
any loss to the Contractor or the Purchaser. In the administration of the
Dispute Account hereunder, the Escrow Agent may execute any of its powers and
perform its duties hereunder directly or through agents or attorneys and may
consult with counsel, accountants and other skilled persons to be selected and
retained by it.

            6. The Escrow Agent may resign and be discharged from its duties or
obligations hereunder by giving notice to the Contractor and the Purchaser in
writing of such resignation specifying a date when such resignation shall take
effect except that the Escrow Agent shall hold the Dispute Fund until it is paid
in accordance with the joint written instructions of Contractor and Purchaser.
If no such instructions are received within 30 days, the resigning Escrow Agent
may, upon notice to Contractor and Purchaser, arrange for a successor escrow
agent which shall be a national banking institution or trust company located in
New York City, New York. The Escrow Agent shall have the right to withhold an
amount equal to the amount due and owing to the Escrow Agent, plus any costs and
expenses the Escrow Agent shall reasonably believe may be incurred by the Escrow
Agent in connection with the termination of the Escrow Agreement.

            7. The Purchaser and Contractor hereby agree to pay to the Escrow
Agent upon execution of this agreement compensation for the services to be
rendered hereunder as described in Exhibit E hereto, in advance, and will pay or
reimburse the Escrow Agent upon request for all expenses, disbursements and
advances, including reasonable attorneys' fees, incurred or made by it in
connection with carrying out its duties hereunder (including, without
limitation, in connection with the making or liquidation of any investments
under Section 2).

            8. The Purchaser and the Contractor hereby agree to jointly and
severally indemnify the Escrow Agent for, and to hold it harmless against any
loss, liability or expense incurred without gross negligence or bad faith on the
part of the Escrow Agent, arising out of or in connection with its entering into
this Agreement and carrying out its duties hereunder, including the costs and
expenses of defending itself against any claim of liability and with respect to
any investigation. The Escrow Agent may charge against all property in the
Dispute Account any amounts owed to it under the foregoing indemnity if not paid
when due or may withhold payment of such property as security for any
unliquidated claims. Notwithstanding anything in this Escrow Agreement to the
contrary, in no event shall the Escrow Agent be liable
<PAGE>   107
                                                                          4

for special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Escrow Agent has been
advised of the likelihood of such loss or damage and regardless of the form of
action.

            9. The duties and responsibilities of the Escrow Agent hereunder
shall be determined solely by the express provisions of this Escrow Agreement,
and no other or further duties or responsibilities shall be implied.

            10. The Escrow Agent hereby expressly acknowledges and agrees that
it shall have neither a lien nor any other right or claim on any amounts
deposited in the Dispute Account on its own account (excepting its fees and
expenses under this Agreement to the extent not paid after demand upon
Purchaser).

            11. All notices and communications hereunder shall be in writing and
shall be deemed to be duly given when received if sent by registered mail,
return receipt requested, or when delivered if sent by personal hand or by
facsimile transmission, as follows:

                  If to Escrow Agent:
                  [_________________]

                  Attn:
                  Fax:

                  If to Purchaser:
                  [________________ Crossing Ltd.]
                  Wessex House
                  45 Reid Street
                  Hamilton HM12
                  Bermuda
                  Attn:  Robert Klug
                  Tel:  441-296-8600
                  Fax:  441-296-8606
                  Tax Identification Number:

                  If to Contractor:
                  [_________________]

                  Tel:
                  Fax:
                  Tax Identification Number:
<PAGE>   108
                                                                               5

or at such other address as any of the above may have furnished to the other
parties in writing as set forth above and any such notice or communication given
in the manner specified in this Paragraph 11. A copy of any notice or
communication under this Escrow Agreement which is given by any party shall be
given by such party to each of the parties hereto.

            12. (a) In the event funds transfer instructions are given (other
than in writing at the time of execution of the Escrow Agreement), whether in
writing, by telecopier or otherwise, the Escrow Agent is authorized to seek
confirmation of such instructions by telephone call-back to the person or
persons designated in Exhibit F hereto, and the Escrow Agent may rely upon the
confirmations of anyone purporting to be the person or persons so designated.
The persons and telephone numbers for call-backs may be changed only in a
writing actually received and acknowledged by the Escrow Agent. The parties to
this Escrow Agreement acknowledge that such security procedure is commercially
reasonable.

            (b) It is understood that the Escrow Agent and the beneficiary's
bank in any funds transfer may rely solely upon any account numbers or similar
identifying number provided by either of the parties hereto to identify (i) the
beneficiary, (ii) the beneficiary's bank, or (iii) an intermediary bank. The
Escrow Agent may apply any of the escrowed funds for any payment order it
executes using any such identifying number, even where its use may result in a
person other than the beneficiary being paid, or the transfer of funds to a bank
other than the beneficiary's bank, or an intermediary bank designated.

            13. The provisions of this Escrow Agreement may be waived, altered,
amended or supplemented, in whole or in part, only by a writing signed by all of
the parties hereto.

            14. It is understood and agreed that the Escrow Agent makes no
representations or warranties hereunder.

            15. Neither this Escrow Agreement nor any right or interest
hereunder may be assigned in whole or in part by any party without the prior
consent of the other parties[; provided that Purchaser may grant a security
interest in its rights hereunder to the senior lenders participating in the
financing of its cable system].

            16. This Escrow Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.

            17. The Escrow Agent shall not incur any liability for following the
instructions herein contained or expressly provided for, or written instructions
given by the parties hereto.
<PAGE>   109
                                                                          6

            18. In the event that the Escrow Agent shall be uncertain as to its
duties or rights hereunder or shall receive instructions, claims or demands from
any party hereto which, in its opinion, conflict with any provision of this
Agreement, it shall be entitled to refrain from taking any action and its sole
obligation shall be to keep safely all property held in escrow until it shall be
directed otherwise in writing by all of the other parties hereto or by final
order or judgment of a court of competent jurisdiction.

            19. Any corporation into which the Escrow Agent in its individual
capacity may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Escrow Agent in its individual capacity shall be a party, or any corporation to
which substantially all the corporate trust business of the Escrow Agent in its
individual capacity may be transferred, shall be the Escrow Agent under this
Escrow Agreement without further act.

            20. The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby. Nothing contained in this Agreement shall be deemed to confer
upon anyone other than the parties hereto (and their permitted successors and
assigns) any legal right or equitable right, remedy or claim under or by reason
of this Agreement.

            21. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAW OF THE STATE OF NEW YORK AND ANY ACTION BROUGHT HEREUNDER SHALL BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK, LOCATED IN THE COUNTY OF NEW
YORK. EACH PARTY HERETO IRREVOCABLY WAIVES ANY OBJECTION ON THE GROUND OF VENUE,
FORUM NON-CONVENIENS OR ANY SIMILAR GROUNDS AND IRREVOCABLY CONSENTS TO SERVICE
OF PROCESS BY MAIL OR IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW AND
CONSENTS TO THE JURISDICTION OF SAID COURTS.
<PAGE>   110
                                                                          7

            IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement on the day and year first above written.

                                        [PURCHASER]

                                        By:
                                             Name:
                                             Title:

                                        [CONTRACTOR]

                                        By:
                                             Name:
                                             Title:

                                        [ESCROW AGENT]

                                        By:
                                             Name:
                                             Title:
<PAGE>   111
                          EXHIBIT A TO ESCROW AGREEMENT

                              Contractor's Account

                   Account Name:
                   Account Number:
                   Bank Name:

                   ABA No.:
                   Reference:
                   Attn:
<PAGE>   112
                          EXHIBIT B TO ESCROW AGREEMENT

                               Purchaser's Account

                   Account Name  [_________ Crossing Ltd.]
                   Account Number:
                   Bank Name:

                   ABA No.:
                   [Reference:      __________________]
                   [Attn:           __________________]

<PAGE>   113
                          EXHIBIT C TO ESCROW AGREEMENT

                             Escrow Agent's Account

                   Account Name:

                   Account Number:

                   Bank Name:
                   ABA Number:
                   Attention:

<PAGE>   114
                          EXHIBIT D TO ESCROW AGREEMENT

                              Permitted Investments

         (a) Direct obligations of, or obligations the principal of and interest
on which are unconditionally guaranteed by, the United States of America (or by
any agency thereof to the extent such obligations are backed by the full faith
and credit of the United States of America), in each case maturing within one
year from the date of acquisition thereof; and

         (b) Investments in certificates of deposit, banker's acceptances and
time deposits maturing within 180 days from the date of acquisition thereof
issued or guaranteed by or placed with, and overnight sweep accounts, money
market deposit accounts issued or offered by, (i) the Escrow Agent or any of its
affiliates or (ii) any of Purchaser's senior lenders and/or any other bank
which, in each case, has a combined capital and surplus and undivided profits of
not less than $250,000,000.

<PAGE>   115
                          EXHIBIT E TO ESCROW AGREEMENT

                     Compensation To Be Paid To Escrow Agent

<PAGE>   116
                          EXHIBIT F TO ESCROW AGREEMENT

               Persons Authorized To Confirm Transfer Instructions

Purchaser:        S. Wallace Dawson, Tel: 441-296-8600
                  Robert Klug, Tel: 441-296-8600
                  Ian McLean, Tel: 441-296-8600

Contractor:
<PAGE>   117
                                                                       EXHIBIT F
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                            FIRST OFFICE APPLICATIONS

1.   64 WDM Submarine Repeater (high power and wide bandwidth)

2.   0.3 nm spacing WTU (Wavelength Terminating Unit)

3.   High gain FEC (Forward Error Correction) in LTU (Line Terminating Unit)

4.   Automatic pre-emphasis control function in MC (Maintenance Controller)

5.   CORBA interface to the upper management system in MC

6.   BWM Release Schedule and Feature Sets are as shown in the Technical Volume
<PAGE>   118
                                                                       EXHIBIT G
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                          LIST OF MAJOR SUBCONTRACTORS

-    Cables:                 Ocean Cable Co., Ltd., Hitachi Cable Co., Ltd.,
                             Pirelli Cavi e Sistemi S.p.A.

-    Repeaters:              Fujitsu Ltd., Mitsubishi Electric Corp., NEC Corp.

-    Terminal Equipment:     Lucent Technologies, Inc., Mitsubishi
                             Electric Corp., Toshiba Corp., NEC Corp.

-    Marine Operation Services:   Global Marine Systems Ltd., as prime
                                  subcontractor (other vessels which may be used
                                  by prime subcontractor are ASEAN Cableship
                                  Pte. Ltd., Caldwell Cable Ventures, Inc.,
                                  Fuguro, Kokusai Cable Ship Co., Ltd., Kokusai
                                  Marine Engineering Corp. Korea Submarine Cable
                                  Systems, S.B. Submarine Systems Co., Ltd.)

-    Site Selection and Cable Station Construction:   Parsons Brinckerhoff,
                                                      Toa Corporation
<PAGE>   119
                                                                       EXHIBIT H
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                              INTELLECTUAL PROPERTY
<PAGE>   120
                                                                       EXHIBIT I
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                                LANDING LICENSES

[To be obtained by Purchaser within ninety days of the date of execution of this
Contract.]
<PAGE>   121
                                                                       EXHIBIT J
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                         EXAMPLES OF CONTRACTOR PERMITS

-    Permission of entry to EEZ

-    Permission of entry to harbor

-    Notification of operations

-    Visas

-    Work permits

-    Import licenses

-    Customs clearances

-    Export licenses
<PAGE>   122
                                                                       EXHIBIT K
                                                                              TO
                                                           CONSTRUCTION CONTRACT

                            EXAMPLES OF OWNER PERMITS

-    Land and building permits for cable stations
         (e.g., certificates of occupancy, fire agency code, building code,
         architectural code, permit for temporary use of site/Hong Kong and
         Singapore)

-    Permits to land cables

-    Government permission for entry to EEZ for surveying operations
        (e.g., permits, approvals, and authorizations necessary for performing
        surveying operations)

-    Government approvals, consents, authorizations, and licenses that give
     approval for route survey activities

-    Permits to lay cables on land and in the water
        (e.g., route permits, seabed occupancy permits, jurisdictional permits)

-    Crossing agreements with government authorities
        (e.g., pipeline (oil, gas, water), power cable, and other
        telecommunications cable)

-    Government licenses for terminal station earth ground beds

-    Environmental or conservation permits
        (e.g., development restrictions, tree preservation, clearance
        requirements, wetlands, endangered species, cultural and architectural
        sites)

-    Government wayleaves for duct route construction

-    Government right-of-ways
         (e.g., land crossings, beach manhole, conduit, national park, shore and
         coastal, sea wall, easements)

-    Agreements with fishermen's unions

-    Government excavation and road access permits
<PAGE>   123
                                                                       EXHIBIT L
                                                        TO CONSTRUCTION CONTRACT

                               EAST ASIAN CROSSING

                              CONSTRUCTION CONTRACT

                                SUPPLEMENT NO. 1

         Supplement No. 1, dated as of _________, ____ (this "Supplement"), to
the Project Development and Construction Contract described below, among KDD
Submarine Cable Systems Inc. (the "Contractor"), Asia Global Crossing Ltd. (the
"Purchaser"), [___], a [___] corporation (the "China Subsidiary"), [___], a
[___] corporation (the "Hong Kong Subsidiary"), [___], a [___] corporation (the
"Japan Subsidiary"), [___], a [___] corporation (the "Korea Subsidiary"), [___],
[___], a [___] corporation (the "Taiwan Subsidiary")(the China Subsidiary, the
Hong Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary and the Taiwan
Subsidiary, collectively the "Assignees").**

                               W I T N E S S E T H

         WHEREAS, unless otherwise defined herein, capitalized terms used herein
shall have the meanings given to them in the Contract;

         WHEREAS, Contractor and Purchaser have entered into the Project
Development and Construction Contract, dated as of ________, 1999 (as the same
may from time to time be amended, modified or supplemented, the "Contract"),
pursuant to which the Contractor has agreed to design, manufacture, construct,
install and deliver a fiber optic cable system connecting the People's Republic
of China, Hong Kong, Japan, the Republic of Korea and Taiwan, as more fully
described in the Contract;

         WHEREAS, the China Subsidiary, the Hong Kong Subsidiary, the Japan
Subsidiary, the Korea Subsidiary and the Taiwan Subsidiary were formed for the
purpose of owning and/or providing capacity on certain Landing Assets and
Rights;

         WHEREAS, the Purchaser wishes to transfer all rights under the Contract
(i) with respect to the China Landing Assets and Rights to the China Subsidiary,
(ii) with respect to the Hong Kong Landing Assets and Rights to the Hong Kong
Subsidiary, (iii) with respect to the Japan Landing Assets and Rights to the
Japan Subsidiary, (iv) with respect to the Korea Landing Assets and Rights to
the Korea Subsidiary and (v) with respect to the Taiwan Landing Assets and
Rights to the Taiwan Subsidiary;

--------------
**It is the agreement of the Parties that the Purchaser may form a subsidiary
with respect to each jurisdiction where the cable system lands. To the extent
that the configuration changes, the Purchaser shall have the option to add new
assignees.
<PAGE>   124
                                                                               2

         WHEREAS, the Purchaser will own and control all of the System other
than the Landing Assets and Rights provided that the Purchaser remains jointly
and severally liable to pay and perform all obligations with respect to the
Landing Assets and Rights;

         WHEREAS, Sub-Article 37(D) of the Contract contemplates the assignment
by the Purchaser to a Transferee or Transferees of its rights under the Contract
with respect to any particular Landing Assets;

         WHEREAS, Sub-Article 37(D) of the Contract requires that, in connection
with such assignment by Purchaser, the Transferees, the Purchaser and the
Contractor shall execute a supplement to the Contract describing their
respective rights and obligations; and

         WHEREAS, the Contractor, the Purchaser, the China Subsidiary, the Hong
Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary, and the Taiwan
Subsidiary wish to supplement the provisions of the Contract to reflect their
agreement with respect to the Landing Assets;

         NOW THEREFORE, in consideration of the premises, the parties hereto
hereby agree as follows:

         1. Defined Terms. (a) Unless otherwise defined herein, capitalized
terms which are defined in the Contract are used herein as therein defined.

         (b) The Contract is hereby amended by deleting the definition of
"Landing Assets" appearing in the third sentence of Sub-Article 37(D) of the
Contract, and by inserting a new definition of "Landing Assets" in Article 3 of
the Contract as follows:

         "Landing Assets" means, with respect to each Landing Country where a
    portion of the System is located, all real and personal property (including
    leasehold interests therein) comprising the System from time to time and
    located within the territory of such Country, including both the portions of
    such property on the land of such Country and the portion of such property
    under the territorial seas of such Country.

         (c) Article 3 of the Contract is hereby amended to add the following
definitions:

         "China Landing Assets and Rights" means all Landing Assets and Rights
    located in China, including, without limitation, the property to be listed
    on Schedule 1 to Supplement No. 1.

         "China Landing Assets and Rights Price" has the meaning given such term
    in Section 4(a) of Supplement No. 1.

         "China Subsidiary" has the meaning given such term in Supplement No. 1.
<PAGE>   125
                                                                               3

         "Hong Kong Landing Assets and Rights" means all Landing Assets and
Rights located in Hong Kong, including, without limitation, the property to be
listed on Schedule 2 to Supplement No. 1.

         "Hong Kong Landing Assets and Rights Price" has the meaning given such
    term in Section 4(b) of Supplement No. 1.

         "Hong Kong Subsidiary" has the meaning given such term in Supplement
    No. 1.

         "Japan Landing Assets and Rights" means all Landing Assets and Rights
    located in Japan, including, without limitation, the property to be listed
    on Schedule 3 to Supplement No. 1.

         "Japan Landing Assets and Rights Price" has the meaning given such term
    in Section 4(c) of Supplement No. 1.

         "Japan Subsidiary" has the meaning given such term in Supplement No. 1.

         "Korea Landing Assets and Rights" means all Landing Assets and Rights
    located in the Republic of Korea, including, without limitation, the
    property to be listed on Schedule 5 to Supplement No. 1.

         "Korea Landing Assets and Rights Price" has the meaning given such term
    in Section 4(d) of Supplement No. 1.

         "Korea Subsidiary" has the meaning given such term in Supplement No. 1.

         "Landing Assets and Rights" means, with respect to each Landing
    Country, the Landing Assets in such Landing Country together with all
    Permits necessary to own or lease, operate and maintain such Landing Assets
    and all rights or licenses under Articles 18, 19 and 20 of the Contract
    relating to such Landing Assets, including all Deliverable Software, Project
    Intellectual Property and Deliverable Technical Material relating to such
    Landing Assets.

         "Landing Countries" means the People's Republic of China, Hong Kong,
    Japan, Korea and Taiwan.

         "Supplement No. 1" means Supplement No. 1, dated as of __________,
    2000, to the Contract, among Purchaser, Contractor, the China Subsidiary,
    the Hong Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary and the
    Taiwan Subsidiary and such other subsidiaries or affiliates of the Purchaser
    as may be added thereafter.

         "Taiwan Landing Assets and Rights" means all Landing Assets and Rights
    located in Taiwan, including without limitation, the property to be listed
    on Schedule 5 to Supplement No. 1.
<PAGE>   126
                                                                               4

         "Taiwan Landing Assets and Rights Price" has the meaning given such
    term in Section 4(e) of Supplement No. 1 .

         "Taiwan Subsidiary" has the meaning given such term in Supplement No.
    1.

         2. Assignments of Rights. (a) The Purchaser hereby assigns and
transfers all of its right, title and interest under the Contract with respect
to the China Landing Assets and Rights to the China Subsidiary and the China
Subsidiary hereby accepts such assignment and transfer and assumes all of the
obligations and liabilities of the Purchaser under the Contract with respect to
the China Landing Assets and Rights.

         (b) The Purchaser hereby assigns and transfers all of its right, title
and interest under the Contract with respect to the Hong Kong Landing Assets and
Rights to the Hong Kong Subsidiary and the Hong Kong Subsidiary hereby accepts
such assignment and transfer and assumes all of the obligations and liabilities
of the Purchaser under the Contract with respect to the Hong Kong Landing Assets
and Rights.

         (c) The Purchaser hereby assigns and transfers all of its right, title
and interest under the Contract with respect to the Japan Landing Assets and
Rights to the Japan Subsidiary and the Japan Subsidiary hereby accepts such
assignment and transfer and assumes all of the obligations and liabilities of
the Purchaser under the Contract with respect to the Japan Landing Assets and
Rights.

         (d) The Purchaser hereby assigns and transfers all of its right, title
and interest under the Contract with respect to the Korea Landing Assets and
Rights to the Korea Subsidiary and the Korea Subsidiary hereby accepts such
assignment and transfer and assumes all of the obligations and liabilities of
the Purchaser under the Contract with respect to the Korea Landing Assets and
Rights.

         (e) The Purchaser hereby assigns and transfers all of its right, title
and interest under the Contract with respect to the Taiwan Landing Assets and
Rights to the Taiwan Subsidiary and the Taiwan Subsidiary hereby accepts such
assignment and transfer and assumes all of the obligations and liabilities of
the Purchaser's under the Contract with respect to the Taiwan Landing Assets and
Rights.

         (f) The Contractor hereby acknowledges, consents and agrees to the
assignments and assumptions referred to in paragraphs (a) through (e) of this
Section 2 subject to the provisions of Section 3 below.

         (g) For purposes of determining the submerged Landing Assets subject to
the foregoing transfer, it is assumed that under the current law of each Landing
Country, the territorial seas of such Country (including for such Country's tax
purposes) extend twelve nautical miles seaward from the coast of such Country.
If such assumption shall prove to be incorrect, or if a law or a formal
declaration by applicable tax authority shall change such
<PAGE>   127
                                                                               5

assumption and in fact the territorial seas of any country extend beyond twelve
nautical miles, the parties shall adjust the Landing Assets subject to this
Agreement.

         (h) Without limiting the generality of the foregoing, each of the China
Subsidiary, the Hong Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary
and the Taiwan Subsidiary acknowledges and agrees that it will be subject to the
same restrictions on the transfer of its Landing Assets and Rights as the
Purchaser under Sub-Article 37(D) of the Contract (the "Transfer Restrictions")
and further agrees that it will cause each direct or indirect transferee of any
of its Landing Assets and Rights to acknowledge and agree that such transferee
is also subject to the Transfer Restrictions.

         (i) the Purchaser represents and warrants that the China Subsidiary,
the Hong Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary and the
Taiwan Subsidiary are each direct or indirect wholly-owned subsidiaries and
acknowledges and agrees that any transfer of any interest in the China
Subsidiary, the Hong Kong Subsidiary, the Japan Subsidiary, the Korea Subsidiary
and the Taiwan Subsidiary (or any other person or entity with any Landing Assets
and Rights) will be subject to the Transfer Restrictions to the same extent as a
transfer of Landing Assets and further agrees that it will cause each direct or
indirect transferee of any such interest to acknowledge and agree that such
transferee is also subject to the Transfer Restrictions with respect to such
interest.

         3. Joint and Several Liability. (a) Notwithstanding the assignments and
assumptions set forth in Section 2 above, the Purchaser shall remain liable to
pay and perform all of the obligations and liabilities under the Contract with
respect to the assigned Landing Assets and Rights, including, without
limitation, the payment obligations under Section 4 hereof.

         4. Amounts Payable under the Contract. (a) The China Subsidiary agrees
to pay to Contractor, and/or the designated affiliate of Contractor to which
portions of the Contract are assigned, all amounts payable under the Contract,
when and as due thereunder, with respect to the China Landing Assets and Rights
(the "China Landing Assets and Rights Price"). The portion of the Initial
Contract Price with respect to the China Landing Assets and Rights is to be set
forth on Schedule 1 and is subject to adjustment as provided in Section 4(f)
hereof.

         (b) The Hong Kong Subsidiary agrees to pay to Contractor, and/or the
designated affiliate of Contractor to which portions of the Contract are
assigned, all amounts payable under the Contract, when and as due thereunder,
with respect to the Hong Kong Landing Assets and Rights (the "Hong Kong Landing
Assets and Rights Price"). The portion of the Initial Contract Price with
respect to the Hong Kong Landing Assets and Rights is to be set forth on
Schedule 2 and is subject to adjustment as provided in Section 4(f) hereof.

         (c) The Japan Subsidiary agrees to pay to Contractor, and/or the
designated affiliate of Contractor to which portions of the Contract are
assigned, all amounts payable under the Contract, when and as due thereunder,
with respect to the Japan Landing Assets and Rights (the "Japan Landing Assets
and Rights Price"). The portion of the Initial Contract Price with
<PAGE>   128
                                                                               6

respect to the Japan Landing Assets and Rights is to be set forth on Schedule 3
and is subject to adjustment as provided in Section 4(f) hereof.

         (d) The Korea Subsidiary agrees to pay to Contractor, and/or the
designated affiliate of Contractor to which portions of the Contract are
assigned, all amounts payable under the Contract, when and as due thereunder,
with respect to the Korea Landing Assets and Rights (the "Korea Landing Assets
and Rights Price"). The portion of the Initial Contract Price with respect to
the Korea Landing Assets and Rights is to be set forth on Schedule 4 and is
subject to adjustment as provided in Section 4(f) hereof.

         (e) The Taiwan Subsidiary hereby agrees to pay to Contractor, and/or
the designated affiliate of Contractor to which portions of the Contract are
assigned, all amounts payable under the Contract, when and as due thereunder,
with respect to the Taiwan Landing Assets and Rights (the "Taiwan Landing Assets
and Rights Price"). The portion of the Initial Contract Price with respect to
the Taiwan Landing Assets and Rights is to be set forth on Schedule 5 and is
subject to adjustment as provided in Section 4(f) hereof.

         (f) The amounts set forth in Schedules 1, 2, 3, 4 and 5 represent the
portions of the Initial Contract Price attributable to the respective Landing
Assets and Rights are not in addition to the Initial Contract Price, and are
subject to adjustments and additions pursuant to the Contract to the same extent
as the Initial Contract Price.

         (g) The Contractor and/or its applicable affiliate(s) will send
separate appropriate invoices to the China Subsidiary, the Hong Kong Subsidiary,
the Japan Subsidiary, the Korea Subsidiary and the Taiwan Subsidiary for payment
for Landing Assets and Rights and accept payment from such Subsidiaries. All
invoices and payments will be in U.S. Dollars.

         5. Delivery of Landing Assets. (a) The Contractor and/or its applicable
affiliate(s) hereby agree to deliver, transfer and assign, or cause to be
delivered, transferred and assigned (a) all right, title and interest in the
China Landing Assets and Rights to the China Subsidiary, (b) all right, title
and interest in the Hong Kong Landing Assets and Rights to the Hong Kong
Subsidiary, (c) all right, title and interest in the Japan Landing Assets and
Rights to the Japan Subsidiary, (d) all right, title and interest in the Korea
Landing Assets and Rights to the Korea Subsidiary and (e) all right, title and
interest in the Taiwan Landing Assets and Rights to the Taiwan Subsidiary.

         (b) The Purchaser and each of its direct and indirect assignees and
transferees shall act collectively under the Contract and through the Purchaser
as its agent with respect to Consents, Performance Requirements, Acceptance
Testing, Contract Variations, System Upgrades, termination and suspension of all
or any part of the Contract and acceptance of the System, any Phase or any
Segment (including, without limitation, the issuance of Certificates of
Commercial Acceptance, Provisional Acceptance and Final Acceptance), and any
notices, certificates or requests by the Purchaser with respect to any of the
foregoing shall be deemed to have been given by the Purchaser and its direct and
indirect transferees and assignees and any notices, certificates or requests by
any other person with respect to the foregoing shall have no
<PAGE>   129
                                                                               7

force or effect. Without limiting the foregoing, the parties acknowledge and
agree that no title to any portion of a Segment, a Phase or the System shall be
transferred to the Purchaser or any of its assignees or transferees unless all
requirements under the Contract for transfer of the entire Segment, entire Phase
or the System, as the case may be, have been satisfied in full.

         (c) The Purchaser shall act as agent for its direct and indirect
assignees and transferees for the receipt of notices (excluding invoices),
reports and information (including the copies of the documentation provided
under Article 31 of the Contract) from the Contractor, and notices, reports and
information delivered to the Purchaser by the Contractor shall be deemed to have
been delivered to the Purchaser and its direct and indirect transferees. The
Purchaser shall furnish copies of all such notices, reports and information to
the China Subsidiary, the Hong Kong Subsidiary, the Japan Subsidiary, the Korea
Subsidiary and the Taiwan Subsidiary

         6. Insurance. The Contractor hereby agrees to amend its insurance
policies maintained pursuant to Sub-Article 27(A) of the Contract to name each
Assignee as an additional insured, to the same extent as the Purchaser is so
named pursuant to Sub-Article 27(B) of the Contract, as to operations under the
Contract with respect to the Landing Assets and Rights transferred to such
Assignee hereunder, in which event the Contractor's insurance shall be primary
to any insurance carried by such Assignee.

         7. Schedules. (a) The China Subsidiary, the Purchaser and the
Contractor agree to use their best efforts to complete Schedule 1 hereto as soon
as is practicable.

         (b) The Hong Kong Subsidiary, the Purchaser and the Contractor agree to
use their best efforts to complete Schedule 2 hereto as soon as is practicable.

         (c) The Japan Subsidiary, the Purchaser and the Contractor agree to use
their best efforts to complete Schedule 3 hereto as soon as is practicable.

         (d) The Korea Subsidiary, the Purchaser and the Contractor agree to use
their best efforts to complete Schedule 4 hereto as soon as is practicable.

         (e) The Taiwan Subsidiary, the Purchaser and the Contractor agree to
use their best efforts to complete Schedule 5 hereto as soon as is practicable.

         8. Notices. Any notices, consent, approval, or other communication
pursuant to this Supplement shall be in writing, in the English language, and
shall be effected in the manner provided for in Sub-Article 35(A) of the
Contract, and in the case of the China Subsidiary, the Hong Kong Subsidiary, the
Japan Subsidiary, the Korea Subsidiary and the Taiwan Subsidiary at the address
specified below its signature hereto or to the Purchaser as its agent for
notices.

         9. Parties. As between the Contractor, the Purchaser and each Assignee
that becomes a party hereto, this Supplement shall be treated as, and shall be
enforceable as, an agreement between the Contractor, the Purchaser and such
Assignee and therefor it is not
<PAGE>   130
                                                                               8

necessary for all Assignees to become parties hereto in order for this
Supplement to become valid and enforceable as between the Contractor, the
Purchaser and each Assignee which does become a party hereto.

         10. GOVERNING LAW. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, UNITED
STATES.

         11. Miscellaneous. Except as expressly amended or supplemented herein,
the Contract shall continue to be, and shall remain, in full force and effect in
accordance with its terms. This Supplement may be executed by the parties in any
number of separate counterparts (including by facsimile transmission) and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.
<PAGE>   131
                                                                               9

         IN WITNESS WHEREOF, each of the undersigned has caused this Supplement
to be duly executed and delivered in the location set forth below its signature
by its proper and duly authorized officer as of the date hereof.

                                       KDD SUBMARINE CABLE SYSTEMS INC.

                                       By:_____________________________
                                          Title:
                                          Signed in:

                                       ASIA GLOBAL CROSSING LTD.

                                       By:_____________________________
                                          Title:
                                          Signed in:

                                       [CHINA SUBSIDIARY]

                                       By:_____________________________
                                          Title:
                                          Signed in:

                                       [HONG KONG SUBSIDIARY]

                                       By:_____________________________
                                          Title:
                                          Signed in:

                                       [JAPAN SUBSIDIARY]

                                       By:_____________________________
                                          Title:
                                          Signed in:
<PAGE>   132
                                                                              10

                                       [KOREA SUBSIDIARY]

                                       By:_____________________________
                                          Title:
                                          Signed in:

                                       [TAIWAN SUBSIDIARY]

                                       By:_____________________________
                                          Title:
                                          Signed in:
<PAGE>   133
                                                                              11

The undersigned, the Guarantor of the Contract (i) acknowledges receipt of a
copy of, and hereby consents to the matters set forth in, the foregoing
Supplement No. 1 and (ii) ratifies and confirms in all respects its obligations
under the Guaranty, dated as of __________, ____, which Guaranty remains in full
force and effect with regard to Purchaser and to each of Purchaser's assignees.

                                       KDD CORPORATION

                                       By: ________________________
                                           Title:
<PAGE>   134
                                   SCHEDULE 1

Part 1

China Landing                               Amounts Payable
Assets and Rights                           $
<PAGE>   135
                                   SCHEDULE 2

Hong Kong Landing
Assets and Rights                           Amounts Payable
                                            $
<PAGE>   136
                                   SCHEDULE 3

Japan Landing
Assets and Rights                           Amounts Payable
                                            $
<PAGE>   137
                                   SCHEDULE 4

Korea Landing
Assets and Rights                           Amounts Payable
                                            $
<PAGE>   138
                                   SCHEDULE 5

Taiwan Landing
Assets and Rights                           Amounts Payable
                                            $
<PAGE>   139
                                                                       EXHIBIT M
                                                        TO CONSTRUCTION CONTRACT

                               EAST ASIAN CROSSING

                      INDEMNITY AND CONFIRMATION AGREEMENT

         INDEMNITY AND CONFIRMATION AGREEMENT, dated as of December __, 1999
(this "Agreement"), between KDD SUBMARINE CABLE SYSTEMS INC., a corporation
organized and existing under the laws of Japan (the "Indemnitor"), [Local EAC
Company] a corporation organized and existing under the laws of [Local EAC
Jurisdiction] (the "Local Subsidiary"), and Asia Global Crossing Ltd., a
corporation organized and existing under the laws of Bermuda (the "Company" and
together with the Local Subsidiary, the "Indemnitees").

                              W I T N E S S E T H :

         WHEREAS, the Indemnitees and the Indemnitor have entered into the
Project Development and Construction Contract, dated as of December 17, 1999 (as
amended, supplemented or otherwise modified from time to time, the "Construction
Contract"), pursuant to which the Indemnitor has agreed on a fixed-price,
turnkey basis, to design, manufacture, construct, install and deliver a fiber
optic cable system around East Asia (the "System");

         WHEREAS, as a part of its obligations under the Construction Contract,
the Indemnitor is obligated to acquire land and build a cable station in
[proposed Location of Cable Station] (the "Cable Station") which satisfies the
requirements of the Construction Contract and provide the same to the Local
Subsidiary upon completion of the System;

         WHEREAS, the Indemnitor has identified land (the "Land"), upon which it
desires to build the Cable Station, which Land Indemnitor believes is suitable
for such purpose and which Land has been described to the Indemnitees;

         WHEREAS, in accordance with the Construction Contract, the Indemnitor
will pay the purchase price of the Land;

         WHEREAS, the owner(s) of the Land is willing to transfer the Land to
the Local Subsidiary on the terms and conditions set forth in a conveyance
document(s), the form(s) of which has been delivered to the Indemnitees (the
"Deed");

         WHEREAS, as an accommodation, the Indemnitor has requested that the
Local Subsidiary enter into, and/or accept, the Deed in its own name now,
notwithstanding that neither of the Indemnitees is obligated to accept any
property or to assume any obligations with respect to the System until the date
or dates specified under the terms of the Construction Contract;

         WHEREAS, the parties hereto wish to make it clear that the undertaking
of such accommodation by the Indemnitees is not intended to relieve the
Indemnitor of its obligations
<PAGE>   140
                                                                               2

under the Construction Contract, nor is it intended to act as a waiver of any
rights of the Indemnitees under the Construction Contract or otherwise
disadvantage the Indemnitees in any way;

         WHEREAS, the Indemnitor has agreed to indemnify the Indemnitees for any
losses suffered as a result of the acceptance of, and/or execution of, the Deed,
and/or the ownership of the Land, by the Local Subsidiary and the transactions
contemplated thereby, to the extent such losses arise out of the circumstances
described below;

         NOW, THEREFORE, the parties hereto, in consideration of the premises,
hereby agree as follows:

                       Section 1. Indemnity; Confirmation

         (a) The Indemnitor agrees to indemnify each Indemnitee against, and
agrees to protect, defend, save and keep harmless each Indemnitee from, any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
suits, costs, disbursements and expenses (including legal fees and expenses and
all costs and expenses relating to amendments, supplements, adjustments,
consents, and waivers under the Deed) of every kind and nature (collectively,
the "Liabilities"), which may be imposed on, incurred or suffered by or asserted
against it as a result of, in connection with or related to, the acceptance by,
and/or the execution by, the Local Subsidiary of the Deed and/or the ownership
of the Land, to the extent such Liabilities either (a) arise from circumstances
occurring prior to the date on which the Local Subsidiary would have been
required to take possession of the Land pursuant to the Construction Contract
(the "Contract Possession Date"), unless such Liabilities would have been
incurred by such Indemnitees whether or not the Local Subsidiary accepted or
executed the Deed and/or owned the Land prior to the Contract Possession Date
(that is, the Liability would have been incurred even if the Local Subsidiary
had accepted or executed the Deed and/or taken ownership of the Land on the
Contract Possession Date, as opposed to an earlier date) or (b) would not have
been incurred by any of the Indemnitees if the Local Subsidiary had taken
possession on the Contract Possession Date as opposed to an earlier date;
provided, that the Indemnitor shall not be responsible for Liabilities arising
solely from either Indemnitee's gross negligence or willful misconduct; provided
further, that neither Indemnitee shall be deemed to have any duty or obligation
arising out of or relating to the ownership of the Land. This defense,
indemnification and save harmless obligation is specifically conditioned on the
following: (i) Purchaser providing prompt notification in writing of any such
Liabilities when it obtains Actual Knowledge thereof, unless such failure shall
not have materially impaired Contractor's ability to defend against such claim;
(ii) Contractor having control of the defense of any such action, claim or
demand and of all negotiations for its settlement or compromise, provided that
if any of such Liabilities affects the business or interest of Purchaser aside
from solely the possible payment therefor, then such defense and negotiations
shall be joint; and (iii) Purchaser cooperating, at Contractor's expense, in a
reasonable way to facilitate the defense of such claim or demand or the
negotiations for its settlement. The Purchaser, at its option, shall be entitled
to participate, at its own expense, in any proceeding, claim or demand involving
an Indemnitee. For all purposes hereof, the term "Indemnitee" includes all
officers, directors, affiliates and agents.
<PAGE>   141
                                                                               3

         (b) The Indemnitor hereby confirms that (i) all of the provisions
(including all warranties and damage provisions) of the Construction Contract
shall remain in full force and effect and be unaffected by the date of the
execution and delivery of the Deed and the ownership of the Land, (ii) all of
the rights and remedies of the Indemnitees under the Construction Contract may
be enforced by the Indemnitees as if they had not accepted and/or entered into
the Deed prior to the Contract Possession Date and (iii) the Indemnitor will not
raise any act or omission of the Indemnitees under the Deed or with respect to
the Land as a defense to any claim by the Indemnitees under the Construction
Contract.

                            Section 2. Governing Law

         THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, UNITED STATES.

                             Section 3. Severability

         If any provision of this Agreement is found by an arbitral, judicial or
regulatory authority having jurisdiction to be void or unenforceable, such
provision shall be deemed to be deleted from this Agreement and the remaining
provisions shall continue in full force and effect.

                               Section 4. Headings

         The Section headings of this Agreement are for convenience of reference
only and are not intended to restrict, affect or influence the interpretation or
construction of provisions of such Section.

                             Section 5. Counterparts

         This Agreement may be executed in counterparts, each of which when
executed and delivered shall be deemed an original. Such counterparts shall
together (as well as separately) constitute one and the same instrument.

                      Section 6. Submission to Jurisdiction

         Each of the parties hereto hereby irrevocably and unconditionally:

         (a) submits for itself and its property in any legal action or
    proceeding relating to this Agreement or for recognition and enforcement of
    any judgement in respect thereof, to the non-exclusive general jurisdiction
    of the Courts of the State of New York, the courts of the United States of
    America for the Southern District of New York, and appellate courts from any
    thereof;

         (b) consents that any such action or proceeding may be brought in such
    courts and waives any objection that it may now or hereafter have to the
    venue of any such
<PAGE>   142
                                                                               4

    action or proceeding in any such court or that such action or proceeding was
    brought in an inconvenient court and agrees not to plead or claim the same;

                  (c) agrees that service of process in any such action or
         proceeding may be effected by mailing a copy thereof by registered or
         certified mail (or any substantially similar form of mail), postage
         prepaid, to it at its address set forth in Section 7 or at such other
         address of which the other parties shall have been notified pursuant
         thereto; and

                  (d) agrees that nothing herein shall affect the right to
         effect service of process in any other manner permitted by law or shall
         limit the right to sue in any other jurisdiction.

                               Section 7. Notices

         Any notice, consent, approval or other communication pursuant to this
Agreement shall be in writing, in the English language, and shall be effected in
the manner provided for in Sub-Article 35(A) of the Construction Contract,
addressed as follows, or to such other address as may be hereafter notified by
the respective parties hereto:

         Indemnitor:          KDD Submarine Cable Systems Inc.
                              KDD Building, 3-2, Nishi-shinjuku 2-chome
                              Shinjuku-ku, Tokyo 163-8525, Japan
                              Facsimile:  81-3-3347-7237
                                          81-3-3347-8462
                              Telephone: 81-3-3347-8460
                              Attn:  Tatsuhide Nagasawa, Managing Director,
                                     EAC Project Manager

         Company:             Asia Global Crossing Ltd.
                              Wessex House
                              45 Reid Street
                              Hamilton HM 12 Bermuda
                              Attention:  President
                              Telecopy:  (441) 296-8606/6749

         Local Subsidiary:    [name Local Subsidiary]
                              c/o Asia Global Crossing Ltd.
                              as set forth above.
<PAGE>   143
                                                                               5

         IN WITNESS WHEREOF, each of the undersigned has caused this Agreement
to be duly executed and delivered in the jurisdiction set forth below its
signature by its proper and duly authorized officer as of the date first above
written.

                                       ASIA GLOBAL CROSSING LTD.

                                       By__________________________
                                         Title:
                                         Signed in:

                                       [NAME LOCAL SUBSIDIARY]

                                       By___________________________
                                         Title:
                                         Signed in:

                                       KDD SUBMARINE CABLE
                                       SYSTEMS INC.

                                       By___________________________
                                         Title:
                                         Signed in:

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