Document:

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C L I F F O R D                                             [CHINESE CHARACTERS]
C H A N C E
                                                                  CONFORMED COPY

                                                                     EXHIBIT 4.3

                                DATED 19 MAY 2003

                           G.E.C. (HONG KONG) LIMITED
                                   AS COMPANY

                                  IN FAVOUR OF

                   THE LAW DEBENTURE TRUST CORPORATION P.L.C.
                               AS SECURITY TRUSTEE

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                                G.E.C. DEBENTURE

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                                    CONTENTS
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CLAUSE                                                                                               PAGE
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1.     DEFINITIONS AND INTERPRETATION...............................................................   1

2.     PAYMENT OF SECURED OBLIGATIONS...............................................................   5

3.     FIXED CHARGES, ASSIGNMENTS AND FLOATING CHARGE...............................................   6

4.     CRYSTALLISATION OF FLOATING CHARGE...........................................................   7

5.     PERFECTION OF SECURITY.......................................................................   8

6.     FURTHER ASSURANCE............................................................................  10

7.     NEGATIVE PLEDGE AND DISPOSALS................................................................  11

8.     SHARES.......................................................................................  11

9.     ACCOUNTS.....................................................................................  12

10.    MONETARY CLAIMS..............................................................................  13

11.    REAL PROPERTY................................................................................  13

12.    INVESTMENTS: DELIVERY OF DOCUMENTS OF TITLE..................................................  14

13.    INTRA-GROUP LOAN CONTRACTS...................................................................  14

14.    ENFORCEMENT OF SECURITY......................................................................  14

15.    EXTENSION AND VARIATION OF CONVEYANCING AND PROPERTY ORDINANCE...............................  15

16.    APPOINTMENT OF RECEIVER......................................................................  15

17.    POWERS OF RECEIVER...........................................................................  16

18.    APPLICATION OF MONEYS........................................................................  17

19.    PROTECTION OF PURCHASERS.....................................................................  17

20.    POWER OF ATTORNEY............................................................................  17

21.    EFFECTIVENESS OF SECURITY....................................................................  18

22.    RELEASE OF SECURITY..........................................................................  19

23.    SET-OFF......................................................................................  20

24.    SUBSEQUENT SECURITY INTERESTS................................................................  20

25.    CURRENCY INDEMNITY...........................................................................  20

26.    ASSIGNMENT...................................................................................  20

27.    NOTICES......................................................................................  21

28.    EXPENSES, COSTS AND TAXES....................................................................  21

29.    PAYMENTS FREE OF DEDUCTION...................................................................  21

30.    DISCRETION AND DELEGATION....................................................................  22

31.    PERPETUITY PERIOD............................................................................  22
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<S>                                                                                                   <C>
32.    GOVERNING LAW................................................................................  22

33.    JURISDICTION.................................................................................  22

34.    COUNTERPARTS.................................................................................  23

SCHEDULE 1 FORM OF NOTICE OF ASSIGNMENT OF INTRA-GROUP LOAN.........................................  24

SCHEDULE 2           ...............................................................................  27

       Part A Form of Notice of Charge to Landlords.................................................  27

       Part B Form of Notice of Charge Over Account.................................................  29

       Part C Form of Notice of Charge over Monetary Claims.........................................  32

SCHEDULE 3 ADDITIONAL POWERS OF RECEIVER............................................................  35

SCHEDULE 4 DETAILS OF SHARES........................................................................  38
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THIS DEBENTURE is made on 19 MAY 2003

BY

(1)      G.E.C. (HONG KONG) LIMITED registered in Hong Kong with company number
         11379 (the "COMPANY") in favour of

(2)      THE LAW DEBENTURE TRUST CORPORATION P.L.C. as security trustee for the
         Secured Creditors on the terms and conditions set out in the Security
         Trust and Intercreditor Deed (the "SECURITY TRUSTEE" which expression
         shall include any person for the time being appointed as trustee or as
         an additional trustee for the purpose of, and in accordance with, the
         Security Trust and Intercreditor Deed).

IT IS AGREED as follows:

1.       DEFINITIONS AND INTERPRETATION

1.1      DEFINITIONS

         Terms defined in the Security Trust and Intercreditor Deed shall,
         unless otherwise defined in this Debenture, have the same meaning when
         used in this Debenture and in addition:

         "ACCOUNTS" means any credit balance from time to time on any account
         opened or maintained by the Company with any financial institution and
         all Related Rights.

         "CHARGED PROPERTY" means all the assets of the Company which from time
         to time are the subject of the security created or expressed to be
         created in favour of the Security Trustee by or pursuant to this
         Debenture.

         "COLLATERAL RIGHTS" means all rights, powers and remedies of the
         Security Trustee provided by or pursuant to this Debenture or by law.

         "ENFORCEMENT EVENT" has the meaning given to such term in the Security
         Trust and Intercreditor Deed.

         "EXISTING PERFORMANCE BONDS" means surety bonds, appeal bonds, bid
         bonds, performance bonds, letters of credit, bank guarantees or other
         obligations of a like nature issued by a bank, insurance company or
         other financial institution on behalf of Marconi Corporation or any of
         its Subsidiaries in existence on the Issue Date and not issued pursuant
         to an Interim Bonding Facility until such bonds, letters of credit,
         guarantees or obligations expire, terminate or are cancelled.

         "GROUP" means Marconi Corporation and its Subsidiaries for the time
         being.

         "INSOLVENCY EVENT OF DEFAULT" means any Insolvency Event which is also
         an Event of Default.

         "INSURANCE POLICY" means any policy of insurance in which the Company
         may from time to time have an interest and all Related Rights.

         "INTELLECTUAL PROPERTY" means all industrial and intellectual property
         rights whether registered or not including pending applications for
         registration of such rights and the

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         right to apply for registration of such rights including but not
         limited to Patents (as defined in the Indentures), utility models,
         design patents, registered designs, design rights, trade and service
         marks, copyrights (including copyright and equivalent rights in
         computer software), rights in inventions, technical information, rights
         in know-how, business names, database rights, processes, models,
         formulae and experiments and all rights of equivalent or similar effect
         to any of those which may subsist anywhere in the world and all Related
         Rights.

         "INTERIM BONDING FACILITY DOCUMENTS" means the Bonding Documents
         referred to in the Interim Bonding Facility Letter.

         "INTERIM BONDING FACILITY LETTER" means the facility letter dated 10
         May 2002, as amended on 24 October 2002, between HSBC Bank plc,
         Barclays Bank PLC, JPMorgan Chase Bank and Marconi Bonding Limited in
         an amount up to L 150,000,000 (or the equivalent in other
         currencies) for the issuance of bonds, guarantees, letters of credit,
         indemnities and similar instruments.

         "INTRA-GROUP LOAN CONTRACTS" means any contracts between the Company
         and any member of the Group pursuant to which the Company makes
         available intra-Group loans to such member of the Group and all Related
         Rights.

         "INVESTMENTS" means:

         (a)      any stocks, shares, debentures, securities and certificates of
                  deposit (but not including the Shares);

         (b)      all interests in collective investment schemes; and

         (c)      all warrants, options and other rights to subscribe or acquire
                  any of the investments described in (a) and (b),

        in each case whether held directly by or to the order of the Company or
        by any trustee, nominee, fiduciary or clearance system on its behalf and
        all Related Rights (including all rights against any such trustee,
        nominee, fiduciary or clearance system).

         "MARCONI CORPORATION" means Marconi Corporation plc (registered in
         England and Wales with company number 00067307).

         "MONETARY CLAIMS" means any book and other debts and monetary claims
         owing to the Company and any proceeds thereof including, without
         limitation, any claims or sums of money deriving from or in relation to
         any Intellectual Property, the proceeds of any Insurance Policy, any
         court order or judgment, any contract or agreement to which the Company
         is a party and any other assets, property, rights or undertaking of the
         Company and all Related Rights.

         "NEW BONDING FACILITY AGREEMENT" means the L 50 million committed
         revolving bonding facility agreement dated 27 March 2003 among Marconi
         Corporation, Marconi Bonding Limited, HSBC Bank plc as agent and
         security trustee, the lenders described thereunder and certain other
         Subsidiaries providing for the issuance of surety bonds, appeal bonds,
         bid bonds, performance bonds, letters of credit, bank guarantees or
         other obligations of a

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         like nature on behalf of Marconi Corporation and/or any Subsidiary, as
         such agreement may be amended, extended, supplemented or otherwise
         modified from time to time (including, without limitation, any
         successive amendments, extensions, supplements or other modifications
         of the foregoing).

         "NOTICE OF ASSIGNMENT" means a notice of assignment in substantially
         the form set out in Schedule 1.

         "NOTICE OF CHARGE" means a notice of charge in substantially a form set
         out in Schedule 2.

         "REAL PROPERTY" means:

         (a)      any real or immovable property;

         (b)      any buildings, fixtures, fittings, fixed plant or machinery
                  from time to time situated on or forming part of such real or
                  immovable property; and

         (c)      any present or future real or immovable property in which the
                  Company has an interest,

         and includes all Related Rights.

         "RECEIVER" means a receiver or receiver and manager of the whole or any
         part of the Charged Property.

         "RELATED RIGHTS" means, in relation to any asset:

         (a)      the proceeds of sale or assignment of all or any part of that
                  asset;

         (b)      all rights under any licence, agreement for sale or agreement
                  for lease in respect of that asset;

         (c)      all rights, benefits, claims, contracts, warranties, remedies,
                  security, indemnities or covenants for title in respect of
                  that asset; and

         (d)      any moneys and proceeds paid or payable in respect of that
                  asset including, but not limited to royalties, licence
                  payments, awards of damages and payments made pursuant to
                  settlement agreements in respect of that asset.

         "SECURED OBLIGATIONS" means all present and future indebtedness,
         liabilities and obligations (for the avoidance of doubt, including any
         liabilities and obligations which have been cash-collateralised by the
         Company) at any time of the Company under the Relevant Documents, both
         actual and contingent and whether incurred solely or jointly or in any
         other capacity together with any of the following matters relating to
         or arising in respect of those liabilities and obligations:

         (a)      any refinancing, novation, deferral or extension;

         (b)      any obligation relating to any increase in the amount of such
                  obligations;

         (c)      any claim for damages or restitution; and

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         (d)      any claim as a result of any recovery by the Company of a
                  payment or discharge, or non-allowability, on the grounds of
                  preference,

         and any amounts that would be included in any of the above but for any
         discharge, non-provability or unenforceability of those amounts in any
         insolvency or other proceedings (including interest accruing after the
         commencement of any insolvency or other proceedings).

         "SECURITY TRUST AND INTERCREDITOR DEED" means the security trust and
         intercreditor deed dated on or about the date hereof between, amongst
         others, the Security Trustee, Marconi Corporation and other obligors,
         Law Debenture Trust Company of New York as senior note trustee and
         JPMorgan Chase Bank as junior note trustee.

         "SHARES" means all of the shares in the companies set out in Schedule 4
         (Details of Shares) held by, to the order or on behalf of the Company
         at any time and all Related Rights.

         "SUBSIDIARY" means a subsidiary within the meaning of Section 736 of
         the Companies Act 1985 of the United Kingdom, as amended by Section 144
         of the Companies Act 1989 of the United Kingdom.

         "TANGIBLE MOVEABLE PROPERTY" means any plant, machinery, office
         equipment, computers, vehicles and other chattels (excluding any for
         the time being forming part of the Company's stock in trade or work in
         progress) and all Related Rights.

         "TEMPORARY BONDING FACILITY DOCUMENTS" means the Bonding Documents
         referred to in the Temporary Bonding Facility Letter.

         "TEMPORARY BONDING FACILITY LETTER" means the facility letter dated 8
         February 2002 between HSBC Bank plc, Barclays Bank PLC and Marconi
         Bonding Limited in an amount up to (pound)50,000,000 (or equivalent in
         other currencies) for the issuance of bonds, guarantees, letters of
         credit, indemnities and similar instruments.

1.2 INTERPRETATION

         In this Debenture:

         1.2.1    the rules of interpretation contained in clause 1.2
                  (Interpretation) of the Security Trust and Intercreditor Deed
                  shall apply to the construction of this Debenture;

         1.2.2    "continuing" in relation to an Enforcement Event, shall be
                  construed as a reference to an acceleration of any Secured
                  Obligation (other than Secured Obligations arising under the
                  New Bonding Facility Agreement) where such acceleration has
                  not been rescinded in writing or a declaration that the
                  Secured Obligations (other than Secured Obligations arising
                  under the New Bonding Facility Agreement) are prematurely due
                  and payable (other than solely as a result of it becoming
                  unlawful for a Secured Creditor to perform its obligations
                  under the Relevant Documents) where such declaration has not
                  been revoked in writing or any failure by an Obligor to pay
                  any principal amount in respect of any Secured Obligations
                  (other than Secured Obligations arising under the New Bonding
                  Facility Agreement) whether on maturity or otherwise which has
                  not

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                  been remedied or waived in writing. For the purposes of this
                  sub-clause 1.2.2, the definition of "Secured Obligation" shall
                  have the same meaning as in the Security Trust and
                  Intercreditor Deed.

         1.2.3    any reference to the "SECURITY TRUSTEE", the "COMPANY" or the
                  "SECURED CREDITORS" shall be construed so as to include its or
                  their (and any subsequent) successors in title and any
                  permitted assignees and transferees in accordance with their
                  respective interests; and

         1.2.4    references in this Debenture to any Clause or Schedule shall
                  be to a clause or schedule contained in this Debenture.

1.3      HONG KONG

         In this Debenture, "Hong Kong" means the Hong Kong Special
         Administrative Region of the People's Republic of China.

1.4      SECURITY TRUST AND INTERCREDITOR DEED

         The parties hereto each acknowledge that the Security Trustee, when
         acting hereunder, shall be acting in accordance with and subject to the
         terms of the Security Trust and Intercreditor Deed.

1.5      CONFLICT

         Notwithstanding any provision to the contrary contained herein, the
         parties agree that this Debenture is subject in all respects to the
         terms of the Security Trust and Intercreditor Deed and for the
         avoidance of doubt, in the event of any inconsistency, the provisions
         of the Security Trust and Intercreditor Deed shall prevail.

2.       PAYMENT OF SECURED OBLIGATIONS

2.1      COVENANT TO PAY

         The Company hereby covenants with the Security Trustee as trustee for
         the Secured Creditors that it shall on demand of the Security Trustee
         discharge all the Secured Obligations and the Company shall pay to the
         Security Trustee when due and payable every sum at any time owing, due
         or incurred by the Company to the Security Trustee (whether for its own
         account or as trustee for the Secured Creditors) or any of the other
         Secured Creditors in respect of any such liabilities PROVIDED THAT,
         notwithstanding any provision to the contrary contained herein, neither
         such covenant nor the security constituted by this Debenture nor any
         other provisions of this Debenture shall extend to or include or be
         taken as creating security for nor shall the security constituted by
         this Debenture extend to secure any liability or sum which would, but
         for this proviso, cause such covenant, security or provision to be
         unlawful or prohibited by or otherwise to contravene any applicable law
         (including, without limitation, Section 47A of the Companies Ordinance
         (Cap.32)).

2.2      INTEREST ON DEMANDS

         If the Company fails to pay any sum on the due date for payment of that
         sum the Company shall pay interest on such sum (before and after any
         judgment and to the extent interest at a default rate is not otherwise
         being paid on such sum) from the date of demand until the date of
         payment calculated on a daily basis at the rate determined in

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         accordance with the provisions of Clause 18.4 (Interest on Demands) of
         the Security Trust and Intercreditor Deed.

3.       FIXED CHARGES, ASSIGNMENTS AND FLOATING CHARGE

3.1      FIXED CHARGES

         The Company as beneficial owner hereby charges in favour of the
         Security Trustee as trustee for the Secured Creditors as security for
         the payment and discharge of the Secured Obligations, by way of first
         fixed charge all of the Company's right, title and interest from time
         to time in and to each of the following assets:

         3.1.1    the Tangible Moveable Property;

         3.1.2    any goodwill;

         3.1.3    all rights in relation to the uncalled capital of the Company;

         3.1.4    the Shares, all dividends, interest and other monies payable
                  in respect of the Shares and all Related Rights (whether
                  derived by way of redemption, bonus, preference, option,
                  substitution, conversion or otherwise); and

         3.1.5    all Monetary Claims deriving from or in relation to any
                  Intellectual Property,

         provided that, where any contract, instrument or agreement in respect
         of any such asset or, where appropriate, any consent obtained
         thereunder contains an effective prohibition against or restriction on
         the granting of a first fixed charge over such asset, the first fixed
         charge hereby created shall take effect only to the greatest extent
         thereby permitted. The Company undertakes to use commercially
         reasonable efforts to ensure that any asset of any of the categories
         described in sub clauses 3.1.1 to 3.1.5 which is or is to be the
         subject of any contract, instrument or agreement which comes into being
         on or after the date of this Debenture shall be capable of being the
         subject of a first fixed charge in favour of the Security Trustee.

3.2      ASSIGNMENTS

         The Company as beneficial owner hereby assigns to the Security Trustee
         as trustee for the Secured Creditors as security for the payment and
         discharge of the Secured Obligations all the Company's right, title and
         interest from time to time in and to each of the Intra-Group Loan
         Contracts (having already obtained any necessary consent to such
         assignment from any third party).

3.3      FLOATING CHARGE

         The Company as beneficial owner hereby charges in favour of the
         Security Trustee as trustee for the Secured Creditors as security for
         the payment and discharge of the Secured Obligations by way of first
         floating charge the whole of the Company's undertaking and assets
         (including, but not limited to the Real Property, the Accounts, the
         Insurance Policies, the Intellectual Property, the Monetary Claims and
         the Investments), present and future, other than any assets validly and
         effectively charged or assigned (whether at law or in equity) by way of
         fixed security under the laws of Hong Kong, or of the jurisdiction in
         which that asset is situated, in favour of the Security Trustee as
         security for the Secured Obligations, provided that, where any
         contract, instrument or

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         agreement in respect of any such undertaking or asset or, where
         appropriate, any consent obtained thereunder contains an effective
         prohibition against or restriction on the granting of a first floating
         charge over such undertaking or asset, the first floating charge hereby
         created shall take effect only to the greatest extent thereby
         permitted. The Company undertakes to use commercially reasonable
         efforts to ensure that any of the Company's undertaking and assets
         described in this Clause 3.3 which is or is to be the subject of any
         contract, instrument or agreement which comes into being on or after
         the date of this Debenture shall be capable of being the subject of a
         first floating charge in favour of the Security Trustee.

3.4      CASH COLLATERAL

         The security created by Clause 3.3 (Floating Charge) over the Accounts
         shall take effect subject to, and shall not restrict the ability of the
         Company to create, any (a) security or (b) other arrangement under
         which money or claims to, or the benefit of, a bank or other account
         may be applied, set-off, made subject to a combination of accounts or
         otherwise subject to time deposit arrangements or other flawed asset
         rights (whether or not such security is or is to be created on, before
         or after the date of this Debenture) which secures obligations under
         and/or in respect of:

         3.4.1    the Interim Bonding Facility Documents;

         3.4.2    the Temporary Bonding Facility Documents;

         3.4.3    the New Bonding Facility Agreement;

         3.4.4    the Existing Performance Bonds; and

         3.4.5    any other bonding facility expressly permitted pursuant to
                  Section 4.07 (Limitations on Indebtedness and Preferred Stock)
                  of the Senior Note Indenture and Section 4.06 (Limitations on
                  Indebtedness and Preferred Stock) of the Junior Note
                  Indenture,

         in each case as a result of the provision of cash collateral as
         permitted pursuant to the terms of the Indentures or any of them, the
         Escrow Agreement or the Security Trust and Intercreditor Deed.

4.       CRYSTALLISATION OF FLOATING CHARGE

4.1      CRYSTALLISATION:  BY NOTICE

         By notice in writing to Marconi Corporation and the Company, the
         Security Trustee may and shall, if so instructed pursuant to the
         Security Trust and Intercreditor Deed, convert the floating charge
         created by Clause 3.3 (Floating Charge) with immediate effect into a
         fixed charge as regards any property or assets specified in the notice
         if:

         4.1.1    an Event of Default has occurred and is continuing; or

         4.1.2    any person attempts to levy any distress, execution, diligence
                  or other similar process against or to appoint a Receiver over
                  any of the Charged Property; or

         4.1.3    the Security Trustee considers that any of the Charged
                  Property may be in jeopardy or in danger of being seized or
                  sold pursuant to any form of legal

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                  process, other than a voluntary sale of Charged Property
                  entered into by the Company and permitted by the Indentures
                  PROVIDED THAT the Security Trustee shall not be under any duty
                  to monitor the Charged Property.

4.2      CRYSTALLISATION:  AUTOMATIC

         Notwithstanding Clause 4.1 (Crystallisation: By Notice) and without
         prejudice to any law which may have a similar effect, the floating
         charge will automatically be converted (without notice) with immediate
         effect into a fixed charge as regards all the assets subject to the
         floating charge if:

         4.2.1    any person levies any distress, execution, diligence or other
                  similar process against, or appoints a Receiver over, any of
                  the Charged Property; or

         4.2.2    a resolution is passed or an order is made for the winding-up,
                  dissolution or re-organisation of the Company other than in
                  connection with a solvent reconstruction of the Company
                  permitted under the Indentures.

4.3      DE-CRYSTALLISATION:

         4.3.1    Where an asset has become subject to a fixed charge under
                  Clause 4.1 (Crystallisation: By Notice) or Clause 4.2
                  (Crystallisation: Automatic) the Security Trustee shall, if so
                  requested by the Company and if instructed to do so in
                  accordance with the Security Trust and Intercreditor Deed,
                  release the asset from that fixed charge by notice in writing
                  to Marconi Corporation and the Company.

         4.3.2    When an asset is released from the fixed charge under
                  sub-clause 4.3.1 above, the asset will again be subject to:

                  (a)      the floating charge under Clause 3.3 (Floating
                           Charge); and

                  (b)      the further operation of Clause 4.1 (Crystallisation:
                           By Notice) or Clause 4.2 (Crystallisation:
                           Automatic).

5.       PERFECTION OF SECURITY

5.1      NOTICES OF ASSIGNMENT

         Pursuant to Clause 20 (Power of Attorney), the Security Trustee may,
         upon the occurrence of an Insolvency Event of Default and shall, if so
         instructed pursuant to the Security Trust and Intercreditor Deed upon
         or at any time after the occurrence of any Event of Default which is
         continuing, deliver to relevant persons Notices of Assignment duly
         executed by the Security Trustee on behalf of the Company in respect of
         the Intra-Group Loan Contracts.

5.2      NOTICES OF CHARGE

         5.2.1    If so required by the Security Trustee from time to time,
                  within 10 Business Days after the Company enters into any
                  lease falling within the ambit of the security created
                  pursuant to Clause 3 (Fixed Charges, Assignments and Floating
                  Charge), the Company will join the Security Trustee in giving
                  a Notice of Charge to all such landlords and other persons
                  which are parties under such lease of the security constituted
                  under this Debenture in respect of such lease

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                  and will use all commercially reasonable endeavours to procure
                  from each of such landlords and persons an acknowledgement in
                  the form attached thereto.

         5.2.2    The Company shall within 10 Business Days after the date of
                  this Debenture, provide the Security Trustee with details of
                  all Accounts and Monetary Claims falling within the ambit of
                  the security created pursuant to Clause 3 (Fixed Charges,
                  Assignments and Floating Charge) deriving from or relating to
                  any Intellectual Property and in relation to all other
                  Accounts and Monetary Claims falling within the ambit of the
                  security created pursuant to Clause 3 (Fixed Charges,
                  Assignments and Floating Charge), immediately upon the
                  occurrence of an Insolvency Event of Default or upon request
                  by the Security Trustee if instructed pursuant to the Security
                  Trust and Intercreditor Deed upon or after the occurrence of
                  any Event of Default which is continuing, to enable the
                  Security Trustee to deliver a Notice of Charge in accordance
                  with sub-clause 5.2.3 and/or sub-clause 5.2.4 below.

         5.2.3    Pursuant to Clause 20 (Power of Attorney), the Security
                  Trustee may, upon the occurrence of an Insolvency Event of
                  Default and shall, if so instructed pursuant to the Security
                  Trust and Intercreditor Deed upon or at any time after the
                  occurrence of any Event of Default which is continuing,
                  deliver to relevant persons, Notices of Charge duly executed
                  by the Security Trustee on behalf of the Company in respect of
                  any Monetary Claims falling within the ambit of the security
                  created pursuant to Clause 3 (Fixed Charges, Assignments and
                  Floating Charge).

         5.2.4    Pursuant to Clause 20 (Power of Attorney), the Security
                  Trustee may, upon the occurrence of an Insolvency Event of
                  Default and shall, if so instructed pursuant to the Security
                  Trust and Intercreditor Deed upon or at any time after the
                  occurrence of any Event of Default which is continuing,
                  deliver to relevant persons Notices of Charge duly executed by
                  the Security Trustee on behalf of the Company in respect of
                  any Accounts falling within the ambit of the security created
                  pursuant to Clause 3 (Fixed Charges, Assignments and Floating
                  Charge).

5.3      REAL PROPERTY:  DELIVERY OF DOCUMENTS OF TITLE

         The Company shall, upon the acquisition by it of any interest in any
         Real Property to the extent requested by the Security Trustee, deliver
         (or procure delivery) to or to the order of the Security Trustee of,
         and the Security Trustee shall be entitled to hold and retain, all
         deeds, certificates and other documents of title relating to such
         property.

5.4      FURTHER ADVANCES

         Subject to the terms of the Relevant Documents certain Secured
         Creditors are under an obligation to make further advances to the
         Company and that obligation will be deemed to be incorporated into this
         Debenture as if set out in this Debenture.

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5.5      DELIVERY OF SHARE CERTIFICATES

         The Company shall:

         5.5.1    within 10 Business Days of the date of this Debenture, deposit
                  (or procure the deposit of) with or to the order of the
                  Security Trustee or with such Delegate as the Security Trustee
                  may appoint for this purpose all certificates or other
                  documents of title to the Shares, and stock transfer forms or
                  other instruments of transfer in respect thereof (executed in
                  blank by or on behalf of the Company or its nominee(s)) except
                  that the Company shall only be required to use commercially
                  reasonable efforts to procure the deposit of the instrument of
                  transfer in respect of the one share in Ilminster Enterprises
                  Limited which, as at the date of this Debenture, is registered
                  under the name of Peter Dawes; and

         5.5.2    promptly upon the accrual, offer or issue of any stocks,
                  shares, warrants or other securities in respect of or derived
                  from the Shares, notify the Security Trustee of that
                  occurrence and procure the delivery to the Security Trustee or
                  to the order of the Security Trustee of (a) all certificates
                  or other documents of title representing such items and (b)
                  such stock transfer forms or other instruments of transfer
                  (executed in blank by or on behalf of the Company) in respect
                  thereof.

6.       FURTHER ASSURANCE

6.1      FURTHER ASSURANCE: GENERAL

         The Company shall promptly do all such acts or execute all such
         documents (including assignments, transfers, mortgages, charges,
         notices and instructions) as the Security Trustee may specify (and in
         such form as the Security Trustee may require in favour of the Security
         Trustee or its nominee(s)):

         6.1.1    to perfect the Security created or intended to be created in
                  respect of the Charged Property (which may include the
                  execution by the Company of a mortgage, charge or assignment
                  over all or any of the assets constituting, or intended to
                  constitute, Charged Property) or for the exercise of the
                  Collateral Rights;

         6.1.2    to confer on the Security Trustee Security over any property
                  and assets of the Company located in any jurisdiction outside
                  Hong Kong equivalent or similar to the Security intended to be
                  conferred by or pursuant to this Debenture;

         6.1.3    to confer on the Security Trustee Security and to create,
                  perfect, protect or maintain Security (which in so far as it
                  relates to Real Property (other than fittings, plant and
                  machinery) in Hong Kong shall be a legal charge) over all its
                  right, title and interest from time to time in any Real
                  Property including using commercially reasonable efforts to
                  ensure that any such Real Property which is or is to be
                  subject to of any contract, instrument or agreement which
                  comes into being on or after the date of this Debenture shall
                  be capable of being the subject of such security in favour of
                  the Security Trustee; and/or

         6.1.4    to facilitate the realisation of the Charged Property.

                                     - 10 -
<PAGE>

6.2      NECESSARY ACTION

         If so requested by the Security Trustee the Company shall take all such
         action as is available to it (including making all filings and
         registrations) as may be necessary for the purpose of the creation,
         perfection, protection or maintenance of any Security conferred or
         intended to be conferred on the Security Trustee by or pursuant to this
         Debenture.

7.       NEGATIVE PLEDGE AND DISPOSALS

7.1      NEGATIVE PLEDGE

         The Company undertakes that it shall not, at any time during the
         subsistence of this Debenture, create or permit to subsist any Security
         over all or any part of the Charged Property except as not expressly
         prohibited under the terms of the Indentures.

7.2      NO DISPOSAL OF INTERESTS

         The Company undertakes that it shall not (and shall not agree to) at
         any time during the subsistence of this Debenture, except as not
         expressly prohibited under the terms of the Indentures:

         7.2.1    execute any conveyance, disposition, transfer, lease,
                  assignment or assignation of, or other right to use or occupy,
                  all or any part of the Charged Property;

         7.2.2    create any legal or equitable estate or heritable interest or
                  other interest in, or over, or otherwise relating to, all or
                  any part of the Charged Property; or

         7.2.3    (a) grant or vary, or accept any surrender, or cancellation or
                  renunciation or disposal of, any lease, tenancy, licence,
                  consent or other right to use or occupy in relation to any of
                  the Charged Property or (b) allow any person any right to use
                  or occupy or to become entitled to assert any proprietary
                  interest in, or right over, the Charged Property, which may,
                  in each case, adversely affect the ability of the Security
                  Trustee to exercise any of the Collateral Rights.

8.       SHARES

8.1      SHARES:  BEFORE ENFORCEMENT EVENT

         Prior to the occurrence of an Enforcement Event and at any time when no
         Enforcement Event is continuing, the Company shall:

         8.1.1    be entitled to retain all dividends, interest and other monies
                  arising from the Shares; and

         8.1.2    exercise all voting rights in relation to the Shares PROVIDED
                  THAT the Company shall not exercise such voting rights in any
                  manner which would constitute a Default or an Event of Default
                  under the Indentures (as such terms are defined in the
                  Indentures).

8.2      SHARES:  AFTER ENFORCEMENT EVENT

         The Security Trustee may, upon the occurrence of an Enforcement Event
         and at any time thereafter whilst such Enforcement Event is continuing
         (in the name of the Company or otherwise and without any further
         consent or authority from the Company):

                                     - 11 -
<PAGE>

         8.2.1    exercise (or refrain from exercising) any voting rights in
                  respect of any of the Shares;

         8.2.2    apply all dividends, interest and other monies arising from
                  any of the Shares in accordance with Clause 18 (Application of
                  Moneys);

         8.2.3    transfer any of the Shares into the name of such nominee(s) of
                  the Security Trustee as it shall require; and

         8.2.4    exercise (or refrain from exercising) the powers and rights
                  conferred on or exercisable by the legal or beneficial owner
                  of any of the Shares, including the right, in relation to any
                  company whose shares or other securities are included in the
                  Charged Property, to concur or participate in:

                  (a)      the reconstruction, amalgamation, sale or other
                           disposal of such company or any of its assets or
                           undertaking (including the exchange, conversion or
                           reissue of any shares or securities as a consequence
                           thereof),

                  (b)      the release, modification or variation of any rights
                           or liabilities attaching to such shares or
                           securities, and

                  (c)      the exercise, renunciation or assignment of any right
                           to subscribe for any shares or securities,

                  in each case in such manner and on such terms as the Security
                  Trustee may think fit, and the proceeds of any such action
                  shall form part of the Charged Property.

9.       ACCOUNTS

9.1      ACCOUNTS:  OPERATION BEFORE ENFORCEMENT EVENT

         The Company shall, prior to the delivery of a Notice of Charge pursuant
         to Clause 5.2 (Notices of Charge) or the occurrence of an Enforcement
         Event and at any time thereafter when no Enforcement Event is
         continuing (provided that at such time no Notice of Charge has been
         delivered pursuant to Clause 5.2 (Notices of Charge), be entitled to
         receive, withdraw or otherwise transfer any credit balance from time to
         time on any Account.

9.2      ACCOUNTS:  OPERATION AFTER ENFORCEMENT EVENT

         After the delivery of a Notice of Charge pursuant to Clause 5.2
         (Notices of Charge) or the occurrence of an Enforcement Event and at
         any time thereafter while such Enforcement Event is continuing, the
         Company shall not be entitled to receive, withdraw or otherwise
         transfer any credit balance from time to time on any Account except
         with the prior consent of the Security Trustee.

9.3      ACCOUNTS:  APPLICATION OF MONIES

         The Security Trustee shall, upon the occurrence of an Enforcement Event
         and at any time thereafter whilst such Enforcement Event is continuing,
         be entitled without notice to apply, transfer or set-off any or all of
         the credit balances from time to time on any Account in or towards the
         payment or other satisfaction of all or part of the Secured Obligations
         in accordance with Clause 18 (Application of Moneys).

                                     - 12 -
<PAGE>

10.      MONETARY CLAIMS

10.1     DEALING WITH MONETARY CLAIMS

         The Company shall not at any time during the subsistence of the
         Debenture, without the prior written consent of the Security Trustee or
         except as not expressly prohibited under the terms of the Indentures:

         10.1.1   deal with the Monetary Claims referred to in sub-clause 3.1.5
                  of Clause 3.1 (Fixed Charges) except by getting in and
                  realising them in a prudent manner (on behalf of the Security
                  Trustee) and paying the proceeds of those Monetary Claims
                  referred to in sub-clause 3.1.5 of Clause 3.1 (Fixed Charges)
                  into the Accounts or as the Security Trustee may require (and
                  such proceeds shall be held upon trust by the Company for the
                  Security Trustee on behalf of the Secured Creditors prior to
                  such payment in);

         10.1.2   factor or discount any of the Monetary Claims referred to in
                  sub-clause 3.1.5 of Clause 3.1 (Fixed Charges) or enter into
                  any agreement for such factoring or discounting; or

         10.1.3   (other than as provided in Clause 10.2 (Release of Monetary
                  Claims: Before Enforcement Event) be entitled to withdraw or
                  otherwise transfer the proceeds of the realisation of any
                  Monetary Claims standing to the credit of any Account.

10.2     RELEASE OF MONETARY CLAIMS:  BEFORE ENFORCEMENT EVENT

         Prior to the delivery of a Notice of Charge pursuant to Clause 5.2
         (Notices of Charge) or the occurrence of an Enforcement Event and at
         any time when no Enforcement Event is continuing (provided that at such
         time no Notice of Charge has been delivered pursuant to Clause 5.2
         (Notices of Charge)), the proceeds of the realisation of any Monetary
         Claims deriving from or in relation to any Intellectual Property shall
         (subject to any restriction on the application of such proceeds
         contained in this Debenture, the Indentures or in the Security Trust
         and Intercreditor Deed), upon such proceeds being credited to an
         Account, be released from the fixed charge created pursuant to Clause
         3.1 (Fixed Charges) and the Company shall be entitled to withdraw such
         proceeds from such Account provided that such proceeds shall continue
         to be subject to the floating charge created pursuant to Clause 3.3
         (Floating Charge) and the terms of this Debenture.

11.      REAL PROPERTY

11.1     PROPERTY: NOTIFICATION

         The Company shall promptly notify the Security Trustee of any contract,
         conveyance, transfer or other disposition for the acquisition by the
         Company (or its nominee(s)) of any Real Property and shall promptly
         enter into a further document or deed in respect of such Real Property
         if so required by the Security Trustee.

11.2     ENTITLEMENT TO REMEDY

         If the Company fails to comply with any of the undertakings contained
         in this Clause 11, the Security Trustee shall be entitled (with such
         agents, contractors and others as it sees fit) to do such things as may
         in the opinion of the Security Trustee be required to remedy such
         failure and all moneys spent by the Security Trustee in doing so shall
         be reimbursed

                                      - 13 -
<PAGE>

         by the Company on demand with interest from the date of payment by the
         Security Trustee until reimbursed in accordance with Clause 2.2
         (Interest on Demands).

12.      INVESTMENTS: DELIVERY OF DOCUMENTS OF TITLE

         After the occurrence of an Enforcement Event, the Company shall
         promptly deliver (or procure delivery) to the Security Trustee, and the
         Security Trustee shall be entitled to retain, all of the Investments
         and any certificates and other documents of title representing the
         Investments to which the Company (or its nominee(s)) is or becomes
         entitled together with any other document which the Security Trustee
         may request (in such form and executed as the Security Trustee may
         require) with a view to perfecting or improving its security over the
         Investments or to registering any Investment in its name or the name of
         any nominee(s).

13.      INTRA-GROUP LOAN CONTRACTS

         Prior to the delivery of a Notice of Assignment pursuant to Clause 5.1
         (Notices of Assignment) or the occurrence of an Enforcement Event, the
         Company shall be entitled to deal with the Intra-Group Loan Contracts
         except as expressly prohibited under the Indentures or the Security
         Trust and Intercreditor Deed.

14.      ENFORCEMENT OF SECURITY

14.1     ENFORCEMENT

         At any time after the occurrence of an Enforcement Event and the
         Security Trustee (acting on the instructions received pursuant to the
         terms of the Security Trust and Intercreditor Deed) giving notice to
         Marconi Corporation and the Company thereof, the security created by or
         pursuant to this Debenture is immediately enforceable and the Security
         Trustee may, in its absolute discretion:

         14.1.1   enforce all or any part of that security (at the times, in the
                  manner and on the terms it thinks fit) and take possession of
                  and hold or dispose of all or any part of the Charged
                  Property; and

         14.1.2   whether or not it has appointed a Receiver, exercise all or
                  any of the powers, authorities and discretions conferred by
                  the Conveyancing and Property Ordinance (Cap.219) (as varied
                  or extended by this Debenture) insofar as applicable on
                  mortgagees and by this Debenture on any Receiver or otherwise
                  conferred by law on mortgagees or Receivers.

14.2     NO LIABILITY AS MORTGAGEE IN POSSESSION

         Neither the Security Trustee nor any Receiver shall be liable to
         account as a mortgagee or heritable creditor in possession in respect
         of all or any part of the Charged Property or be liable for any loss
         upon realisation or for any neglect, default or omission in connection
         with the Charged Property to which a mortgagee in possession or
         heritable creditor might otherwise be liable.

                                     - 14 -
<PAGE>

15.      EXTENSION AND VARIATION OF CONVEYANCING AND PROPERTY ORDINANCE

15.1     EXTENSION OF POWERS

         Insofar as applicable the power of sale or other disposal conferred on
         the Security Trustee and on any Receiver by this Debenture shall
         operate as a variation and extension of the statutory power of sale
         under Sections 51 and 53 of the Conveyancing and Property Ordinance
         (Cap.219) and such power shall arise (and the Secured Obligations shall
         be deemed due and payable for that purpose) on execution of this
         Debenture.

15.2     RESTRICTIONS

         The restrictions contained in paragraph 11 of the Fourth Schedule to
         the Conveyancing and Property Ordinance (Cap.219) shall not apply to
         this Debenture or to the exercise by the Security Trustee of its right
         to consolidate all or any of the security created by or pursuant to
         this Debenture with any other security in existence at any time or to
         its power of sale, which powers may be exercised by the Security
         Trustee without notice to the Company on or at any time after the
         occurrence of an Enforcement Event.

15.3     POWER OF LEASING

         The statutory powers of leasing, surrendering leases and accepting
         surrenders of leases conferred by the Fourth Schedule to the
         Conveyancing and Property Ordinance (Cap.219) may be exercised by the
         Security Trustee at any time on or after the occurrence of an
         Enforcement Event and, without prejudice to the foregoing, the Security
         Trustee and any Receiver may, whether or not the Security Trustee and
         such Receiver shall then be in possession of the relevant property,
         make any lease or agreement for lease, accept surrenders of leases and
         grant options on such terms (including without limitation as to premium
         and length of term) as it or he shall think fit, without the need to
         comply with any requirement or restriction imposed by the Fourth
         Schedule to the Conveyancing and Property Ordinance (Cap.219).

16.      APPOINTMENT OF RECEIVER

16.1     APPOINTMENT AND REMOVAL

         After the occurrence of an Enforcement Event or if requested to do so
         by the Company, the Security Trustee may by deed or otherwise (acting
         through an authorised officer of the Security Trustee), without prior
         notice to the Company:

         16.1.1   appoint one or more persons to be a Receiver of the whole or
                  any part of the Charged Property;

         16.1.2   remove (so far as it is lawfully able) any Receiver so
                  appointed; and

         16.1.3   appoint another person(s) as an additional or replacement
                  Receiver(s).

16.2     CAPACITY OF RECEIVERS

         Each person appointed to be a Receiver pursuant to Clause 16.1
         (Appointment and Removal) shall be:

         16.2.1   entitled to act individually or together with any other person
                  appointed or substituted as Receiver;

                                     - 15 -
<PAGE>

         16.2.2   for all purposes shall be deemed to be the agent of the
                  Company, who shall be solely responsible for his acts,
                  defaults and liabilities and for the payment of his
                  remuneration and no Receiver shall at any time act as agent
                  for the Security Trustee; and

         16.2.3   entitled to remuneration for his services at a rate to be
                  fixed by the Security Trustee from time to time.

16.3     STATUTORY POWERS OF APPOINTMENT

         The powers of appointment of a Receiver shall be in addition to all
         statutory and other powers of appointment of the Security Trustee under
         the Conveyancing and Property Ordinance (Cap.219) (as extended by this
         Debenture) or otherwise and such powers shall remain exercisable from
         time to time by the Security Trustee in respect of any part of the
         Charged Property.

17.      POWERS OF RECEIVER

17.1     POWERS OF RECEIVER

         Every Receiver shall (subject to any restrictions in the instrument
         appointing him but notwithstanding any winding-up or dissolution of the
         Company) have and be entitled to exercise, in relation to the Charged
         Property (and any assets of the Company which, when got in, would be
         Charged Property) in respect of which he was appointed, and as varied
         and extended by the provisions of this Debenture (in the name of or on
         behalf of the Company or in his own name and, in each case, at the cost
         of the Company):

         17.1.1   insofar as applicable all the powers conferred by the
                  Conveyancing and Property Ordinance (Cap.219) on mortgagors
                  and on mortgagees in possession and on receivers appointed
                  under that Ordinance;

         17.1.2   all the powers and rights of an absolute owner and power to do
                  or omit to do anything which the Company itself could do or
                  omit to do; and

         17.1.3   the power to do all things (including bringing or defending
                  proceedings in the name or on behalf of the Company) which
                  seem to the Receiver to be incidental or conducive to (a) any
                  of the functions, powers, authorities or discretions conferred
                  on or vested in him or (b) the exercise of the Collateral
                  Rights (including realisation of all or any part of the
                  Charged Property) or (c) bringing to his hands any assets of
                  the Company forming part of, or which when got in would be,
                  Charged Property.

17.2     ADDITIONAL POWERS OF RECEIVER

         In addition to and without prejudice to the generality of the
         foregoing, every Receiver shall (subject to any limitations or
         restrictions expressed in the instrument appointing him but
         notwithstanding any winding-up or dissolution of the Company) have the
         powers set out in Schedule 3 (Additional Powers of Receiver) in
         relation to the Charged Property (and any assets of the Company which,
         when got in, would be part of the Charged Property), in respect of
         which he was appointed (and every reference in Schedule 3 (Additional
         Powers of Receiver) to the "Charged Property" shall be read as a
         reference to that part of the Charged Property in respect of which such
         Receiver was appointed).

                                     - 16 -
<PAGE>

17.3     MANNER OF EXERCISING POWERS

         In making any sale or other disposal of all or any part of the Charged
         Property or any acquisition in the exercise of their respective powers
         (including without limitation a disposal by a Receiver to any
         subsidiary of the Company or other body corporate) any Receiver or the
         Security Trustee may accept or dispose of as, and by way of
         consideration for, such sale or other disposal or acquisition, cash,
         shares, loan capital or other obligations, including without limitation
         consideration fluctuating according to or dependent upon profit or
         turnover and consideration the amount whereof is to be determined by a
         third party. Any such consideration may, if thought expedient by such
         Receiver or the Security Trustee, be nil or may be payable or
         receivable in a lump sum or by instalments. Any contract for any such
         sale, disposal or acquisition by such Receiver or the Security Trustee
         may contain conditions excluding or restricting the personal liability
         of such Receiver or the Security Trustee.

18.      APPLICATION OF MONEYS

         All moneys received or recovered by the Security Trustee or any
         Receiver pursuant to this Debenture or the powers conferred by it shall
         (subject to the claims of any person having prior rights thereto and by
         way of variation of the provisions of the Conveyancing and Property
         Ordinance (Cap.219)) be applied first in the payment of the costs,
         charges and expenses incurred and payments made by the Receiver, the
         payment of his remuneration and the discharge of any liabilities
         incurred by the Receiver in, or incidental to, the exercise of any of
         his powers, and thereafter shall be applied by the Security Trustee
         (notwithstanding any purported appropriation by the Company) in
         accordance with the Security Trust and Intercreditor Deed.

19.      PROTECTION OF PURCHASERS

19.1     CONSIDERATION

         The receipt of the Security Trustee or any Receiver shall be conclusive
         discharge to a purchaser and, in making any sale or disposal of any of
         the Charged Property or making any acquisition, the Security Trustee or
         any Receiver may do so for such consideration, in such manner and on
         such terms as it thinks fit.

19.2     PROTECTION OF PURCHASERS

         No purchaser or other person dealing with the Security Trustee or any
         Receiver shall be bound to inquire whether the right of the Security
         Trustee or such Receiver to exercise any of its powers has arisen or
         become exercisable or be concerned with any propriety or regularity on
         the part of the Security Trustee or such Receiver in such dealings.

20.      POWER OF ATTORNEY

20.1     APPOINTMENT AND POWERS

         The Company by way of security irrevocably (within the meaning of
         Section 4 of the Powers of Attorney Ordinance (Cap.31)) appoints the
         Security Trustee, each Delegate and any Receiver severally to be its
         attorney (the "Attorney") and in its name, on its behalf and as its act
         and deed to execute, deliver and perfect all documents and do all
         things which the Attorney may consider to be required or desirable for:

                                     - 17 -
<PAGE>

         20.1.1   carrying out any obligation imposed on the Company by this
                  Debenture (including the execution and delivery of any
                  notices, deeds, charges, assignments or other security and any
                  transfers of the Charged Property); and

         20.1.2   enabling the Security Trustee, each Delegate and any Receiver
                  to exercise, or delegate the exercise of, any of the rights,
                  powers and authorities conferred on them by or pursuant to
                  this Debenture or by law (including, after the occurrence of
                  an Enforcement Event, the exercise of any right of a legal or
                  beneficial owner of the Charged Property).

20.2     RATIFICATION

         The Company shall ratify and confirm all things done and all documents
         executed by any Attorney in the exercise or purported exercise of all
         or any of his powers.

20.3     INDEMNITY

         The Company shall indemnify the Attorney and keep the Attorney
         indemnified against any and all costs, claims and liabilities which the
         Attorney may incur as a result of anything done by the Attorney in the
         proper exercise of any of the powers conferred, or purported to be
         conferred, on him or her by this Debenture unless such cost, claim or
         liability arises as a result of the negligence or wilful misconduct of
         the Attorney.

21.      EFFECTIVENESS OF SECURITY

21.1     CONTINUING SECURITY

         The security created by or pursuant to this Debenture shall remain in
         full force and effect as a continuing security for the Secured
         Obligations unless and until discharged by the Security Trustee.

21.2     CUMULATIVE RIGHTS

         The security created by or pursuant to this Debenture and the
         Collateral Rights shall be cumulative, in addition to and independent
         of every other security which the Security Trustee or any Secured
         Creditor may at any time hold for the Secured Obligations or any other
         obligations or any rights, powers and remedies provided by law. No
         prior security held by the Security Trustee (whether in its capacity as
         trustee or otherwise) or any of the other Secured Creditors over the
         whole or any part of the Charged Property shall merge into the security
         constituted by this Debenture.

21.3     NO PREJUDICE

         The security created by or pursuant to this Debenture and the
         Collateral Rights shall not be prejudiced by any unenforceability or
         invalidity of any other agreement or document or by any time or
         indulgence granted to the Company or any other person, or the Security
         Trustee (whether in its capacity as trustee or otherwise) or any of the
         other Secured Creditors or by any variation of the terms of the trust
         upon which the Security Trustee holds the security or by any other
         thing which might otherwise prejudice that security or any Collateral
         Right.

21.4     REMEDIES AND WAIVERS

         No failure on the part of the Security Trustee to exercise, or any
         delay on its part in exercising, any Collateral Right shall operate as
         a waiver thereof, nor shall any single or

                                  -18 -
<PAGE>

         partial exercise of any Collateral Right preclude any further or other
         exercise of that or any other Collateral Right.

21.5     NO LIABILITY

         None of the Security Trustee, each Delegate, any Attorney or any
         Receiver shall be liable by reason of (a) taking any action permitted
         by this Debenture or (b) any neglect or default in connection with the
         Charged Property or (c) taking possession of or realising all or any
         part of the Charged Property, except in the case of negligence or
         wilful misconduct upon its part.

21.6     PARTIAL INVALIDITY

         If, at any time, any provision of this Debenture is or becomes illegal,
         invalid or unenforceable in any respect under the law of any
         jurisdiction, neither the legality, validity or enforceability of the
         remaining provisions of this Debenture nor of such provision under the
         laws of any other jurisdiction shall in any way be affected or impaired
         thereby and, if any part of the security intended to be created by or
         pursuant to this Debenture is invalid, unenforceable or ineffective for
         any reason, that shall not affect or impair any other part of the
         security.

21.7     COMPANY'S OBLIGATIONS

         The obligations of the Company and the Collateral Rights shall not be
         discharged, impaired or otherwise affected by:

         21.7.1   any winding-up, dissolution, administration or re-organisation
                  of or other change in any Obligor or any other person;

         21.7.2   any of the Secured Obligations being at any time illegal,
                  invalid, unenforceable or ineffective;

         21.7.3   any time or other indulgence being granted to any Obligor or
                  any other person;

         21.7.4   any amendment, variation, waiver or release of any of the
                  Secured Obligations;

         21.7.5   any failure to take or failure to realise the value of any
                  other collateral in respect of the Secured Obligations or any
                  release, discharge, exchange or substitution of any such
                  collateral;

         21.7.6   any other act, event or omission which but for this provision
                  would or might operate to impair, discharge or otherwise
                  affect the obligations of the Company hereunder.

22.      RELEASE OF SECURITY

         The Security Trustee shall, at the cost of the Company, release and
         cancel the security constituted by this Debenture and procure the
         reassignment to the Company of the property and assets assigned to the
         Security Trustee pursuant to this Debenture in accordance with the
         terms and subject to the conditions and circumstances set out in the
         Security Trust and Intercreditor Deed and without recourse to, or any
         representation or warranty by, the Security Trustee or any of its
         nominees.

                                     - 19 -
<PAGE>

23.      SET-OFF

         The Company authorises the Security Trustee (but the Security Trustee
         shall not be obliged to exercise such right), after the occurrence of
         an Enforcement Event which is continuing, to set off against the
         Secured Obligations any amount or other obligation (contingent or
         otherwise) owing by the Security Trustee to the Company.

24.      SUBSEQUENT SECURITY INTERESTS

         If the Security Trustee (acting in its capacity as trustee or
         otherwise) or any of the other Secured Creditors at any time receives
         or is deemed to have received notice of any subsequent Security
         affecting all or any part of the Charged Property or any assignment or
         transfer of the Charged Property which is prohibited by the terms of
         this Debenture or the Indentures, all payments thereafter by or on
         behalf of the Company to (or on behalf of) the Security Trustee
         (whether in its capacity as trustee or otherwise) or any of the other
         Secured Creditors shall be treated as having been credited to a new
         account of the Company and not as having been applied in reduction of
         the Secured Obligations as at the time when the Security Trustee
         received such notice.

25.      CURRENCY INDEMNITY

         If any sum (a "SUM") owing by the Company under this Debenture or any
         order or judgment given or made in relation to this Debenture has to be
         converted from the currency (the "FIRST CURRENCY") in which such Sum is
         payable into another currency (the "SECOND CURRENCY") for the purpose
         of:

         25.1.1   making or filing a claim or proof against the Company;

         25.1.2   obtaining an order or judgment in any court or other tribunal;

         25.1.3   enforcing any order or judgment given or made in relation to
                  this Debenture; or

         25.1.4   applying the Sum in satisfaction of any of the Secured
                  Obligations,

         the Company shall indemnify the Security Trustee from and against any
         loss suffered or incurred as a result of any discrepancy between (a)
         the rate of exchange used for such purpose to convert such Sum from the
         First Currency into the Second Currency and (b) the rate or rates of
         exchange available to the Security Trustee at the time of such receipt
         of such Sum.

26.      ASSIGNMENT

         The Security Trustee may assign and transfer all or any of its rights
         and obligations under this Debenture in accordance with the Security
         Trust and Intercreditor Deed. The Security Trustee shall be entitled to
         disclose such information concerning the Company and this Debenture as
         the Security Trustee considers appropriate to any actual or proposed
         direct or indirect successor or to any person to whom information may
         be required to be disclosed by any applicable law.

                                     - 20 -
<PAGE>

27.      NOTICES

         Each communication to be made under this Debenture shall be made and
         delivered in accordance with the provisions of the Security Trust and
         Intercreditor Deed.

28.      EXPENSES, COSTS AND TAXES

28.1     EXPENSES

         The Company shall, from time to time and promptly on demand by the
         Security Trustee, reimburse to the Security Trustee all costs and
         expenses (including legal fees) on a full indemnity basis together with
         any applicable value-added tax incurred by the Security Trustee and any
         Delegate (PROVIDED THAT in relation to sub-clause 28.1.1 of this Clause
         28.1, such costs and expenses must be properly incurred) in connection
         with:

         28.1.1   the execution, release and discharge of this Debenture and the
                  Security created or intended to be created in respect of the
                  Charged Property and the perfection of the Security
                  contemplated in this Debenture or in any such documents or
                  forming part of the Security created or intended to be created
                  in respect of the Charged Property;

         28.1.2   the actual or contemplated exercise, preservation and/or
                  enforcement of any of the rights, powers and remedies of, or
                  the performance of the duties and obligations of, the Security
                  Trustee or any Delegate, or any amendment or waiver in respect
                  of this Debenture;

         28.1.3   the foreclosure of any Charged Property; and

         28.1.4   the preservation and/or enforcement of the Security created or
                  intended to be created in respect of the Charged Property,

         which shall carry interest from the date of such demand until so
         reimbursed at the rate and on the basis as mentioned in Clause 2.2
         (Interest on Demands).

28.2     STAMP TAXES

         The Company shall pay promptly on demand of the Security Trustee all
         stamp, registration, notarial and other similar Taxes or fees paid or
         payable by the Security Trustee in connection with any action taken or
         contemplated by or on behalf of the Security Trustee for perfecting,
         enforcing, releasing, cancelling, reassigning or resolving any doubt
         concerning, or for any other purpose in relation to this Debenture, any
         amendment thereto, any transfer and/or assignment of the rights and/or
         obligations under the same or the Security created or intended to be
         created in respect of the Charged Property and shall, from time to
         time, indemnify the Security Trustee promptly on demand against any
         liabilities, costs, claims and expenses resulting from any failure to
         pay by the Company or any delay by the Company in paying any such Taxes
         or fees.

29.      PAYMENTS FREE OF DEDUCTION

         All payments to be made to the Security Trustee, any Delegate and/or
         any Receiver under this Debenture shall be made free and clear of and
         without set-off or deduction for or on account of tax unless the
         Company is required to make such payment subject to the deduction or
         withholding of tax, in which case the sum payable by the Company in

                                     - 21 -
<PAGE>

         respect of which such deduction or withholding is required to be made
         shall be increased to the extent necessary to ensure that, after the
         making of such deduction or withholding, the person on account of whose
         liability to tax such deduction or withholding has been made receives
         and retains (free from any liability in respect of any such deduction
         or withholding) a net sum equal to the sum which it would have received
         and so retained had no such deduction or withholding been made or
         required to be made.

30.      DISCRETION AND DELEGATION

30.1     DISCRETION

         Any liberty or power which may be exercised or any determination which
         may be made hereunder by the Security Trustee or any Receiver may,
         subject to the terms and conditions of this Debenture and the Security
         Trust and Intercreditor Deed, be exercised or made in its absolute and
         unfettered discretion without any obligation to give reasons.

30.2     DELEGATION

         Each of the Security Trustee and any Receiver shall have full power to
         delegate (either generally or specifically) the powers, authorities and
         discretions conferred on it by this Debenture (including the power of
         attorney) on such terms and conditions as it shall see fit which
         delegation shall not preclude either the subsequent exercise of such
         power, authority or discretion by the Security Trustee or the Receiver
         itself or any subsequent delegation or revocation thereof.

31.      PERPETUITY PERIOD

         The perpetuity period under the rule against perpetuities, if
         applicable to this Debenture, shall be the period of eighty years from
         the date of the Security Trust and Intercreditor Deed.

32.      GOVERNING LAW

         This Debenture and all matters arising from or connected with it are
         governed by the laws of Hong Kong.

33.      JURISDICTION

33.1     HONG KONG COURTS

         The courts of Hong Kong have exclusive jurisdiction to settle any
         disputes (a "DISPUTE") arising out of, or connected with this Debenture
         (including a dispute regarding the existence, validity or termination
         of this Debenture or the consequences of its nullity).

33.2     CONVENIENT FORUM

         The parties agree that the courts of Hong Kong are the most appropriate
         and convenient courts to settle Disputes between them and, accordingly,
         that they will not argue to the contrary.

33.3     EXCLUSIVE JURISDICTION

         This Clause 33 is for the benefit of the Security Trustee only. As a
         result and notwithstanding Clause 33.1 (Hong Kong Courts), it does not
         prevent the Security Trustee from taking proceedings relating to a
         Dispute in any other courts with

                                     - 22 -
<PAGE>

         jurisdiction. To the extent allowed by law the Security Trustee may
         take concurrent proceedings in any number of jurisdictions.

34.      COUNTERPARTS

         This Debenture may be executed in any number of counterparts, each of
         which shall be deemed an original and this has the same effect as if
         the signatures on the counterparts were on a single copy of this
         Debenture. Any party may enter into this Debenture by signing any such
         counterpart.

THIS DEBENTURE has been signed on behalf of the Security Trustee and executed as
a deed by the Company and is delivered by it on the date specified above.

                                     - 23 -
<PAGE>

                                   SCHEDULE 1

                FORM OF NOTICE OF ASSIGNMENT OF INTRA-GROUP LOAN

To:   [            ]

                                                              Date: [          ]

Dear Sirs,

DEBENTURE DATED [      ] BY G.E.C. (HONG KONG) LIMITED (THE "COMPANY") AND THE
LAW DEBENTURE TRUST CORPORATION P.L.C. (THE "SECURITY TRUSTEE") (THE
"DEBENTURE")

We hereby give you notice, as attorney for and on behalf of the Company, that
the Company has, pursuant to the Debenture, assigned to us as Security Trustee
all their right, title and interest in and to [details of contract] (the
"CONTRACT") including all moneys which may be payable in respect of the
Contract.

With effect from your receipt of this notice:

1.       all payments by you to the Company under or arising from the Contract
         should be made to us or to our order as we may specify in writing from
         time to time [details of the account into which sums are to be paid may
         be included];

2.       all remedies provided for in the Contract or available at law or in
         equity are exercisable by us;

3.       all rights to compel performance of the Contract are exercisable by us
         although the Company shall remain liable to perform all the obligations
         assumed by it under the Contract;

4.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of the Company arising from the Contract belong to us and no
         changes may be made to the terms of the Contract nor may the Contract
         be terminated without our consent; and

5.       you are authorised and instructed, without requiring further approval
         from the Company, to provide us with such information relating to the
         Contract as we may from time to time request and to send us copies of
         all notices issued by you under the Contract to us as well as to the
         Company.

These instructions may not be revoked, nor may the terms of the Contract be
amended, varied or waived without our prior written consent.

We confirm that pursuant to Clause 5.1 (Notices of Assignment) and Clause 20
(Power of Attorney) of the Debenture, we are empowered and authorised to deliver
this Notice of Assignment for and on behalf of the Company.

This letter is governed by Hong Kong law.

                                     - 24 -
<PAGE>

Please acknowledge receipt of this notice by signing the acknowledgement on the
enclosed copy letter and returning it to us at[    ] marked for the attention of
[   ].

Yours faithfully,

..........

by THE LAW DEBENTURE TRUST CORPORATION P.L.C.
as attorney for and on behalf of
G.E.C. (HONG KONG) LIMITED

                                     - 25 -
<PAGE>

[On copy only:

To:      [THE LAW DEBENTURE TRUST CORPORATION P.L.C.] AS SECURITY TRUSTEE

We acknowledge receipt of a notice in the terms set out above and confirm that
we have not received notice of any previous assignments or charges of or over
any of the rights, interests and benefits in and to the Contract and that we
will comply with the terms of that notice.

We further confirm that:

(b)      no amendment, waiver or release of any of such rights, interests and
         benefits shall be effective without your prior written consent;

(c)      no termination of such rights, interests or benefits shall be effective
         unless we have given you thirty days written notice of the proposed
         termination, specifying the action necessary to avoid such termination;
         and

(d)      no breach or default on the part of the Company of any of the terms of
         the Contract shall be deemed to have occurred unless we have given you
         notice of such breach specifying how to make good such breach.

For and on behalf of [        ]

By:      .............

Dated:

                                     - 26 -
<PAGE>

                                   SCHEDULE 2

                                     PART A
                      FORM OF NOTICE OF CHARGE TO LANDLORDS

To:               [Landlord]

Date:             [       ]

Dear Sirs,

We give you notice that, by a Debenture dated [ ] (the "DEBENTURE") we charged
to The Law Debenture Trust Corporation p.l.c. (the "SECURITY TRUSTEE") as
security trustee for the Secured Creditors referred to in the Debenture all our
right, interests and benefits in, to and under the [describe Lease] dated [ ]
between [ ] relating to [ ] (including all monies payable thereunder and the
proceeds of all claims and judgments for breach of covenant) (the "LEASE").

We will remain liable to perform all our obligations under the Lease and the
Security Trustee is under no obligation of any kind whatsoever under the Lease
nor under any liability whatsoever in the event of any failure by us to perform
our obligations under the Lease.

Please note that:

1.       all remedies provided for under the Lease or available at law or in
         equity are exercisable by the Security Trustee;

2.       all rights to compel performance of the Lease are exercisable by the
         Security Trustee; and

3.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of ourselves arising under the Lease belong to the Security
         Trustee.

This letter is governed by and will be construed in accordance with the laws of
Hong Kong. Would you acknowledge receipt of this notice by sending the enclosed
acknowledgement to the Security Trustee with a copy to ourselves.

Yours faithfully

[              ]

G.E.C. (HONG KONG) LIMITED

                                     - 27 -
<PAGE>

                            ACKNOWLEDGEMENT OF CHARGE

To:               The Law Debenture Trust Corporation p.l.c.
                  as Security Trustee

Date:             [     ]

Dear Sirs

We confirm receipt from G.E.C. (Hong Kong) Limited (the "COMPANY") of a notice
dated [ ] of a charge upon the terms of a Debenture dated [ ] (the "DEBENTURE")
to The Law Debenture Trust Corporation p.l.c. (the "SECURITY TRUSTEE") as
security trustee for the Secured Creditors of all the Company's right, interest
and benefit in, to and under the Lease (as specified in that notice) to which we
are a party.

We confirm that we have not received notice of any assignment or charge of or
over any of the rights, interests and benefits specified in such notice.

We further confirm that:

1.       no amendment, waiver or release of any such rights, interests and
         benefits will be effective without the prior written consent of the
         Security Trustee;

2.       no termination of such rights, interests or benefits will be effective
         unless we have given the Security Trustee at least 21 days' written
         notice of the proposed termination and specifying the action necessary
         to avoid such termination;

3.       the Company will remain liable to perform all its obligations under the
         Lease and the Security Trustee is under no obligation of any kind
         whatsoever under the Lease nor under any liability whatsoever in the
         event of any failure by the Company to perform our obligations under
         the Lease; and

4.       no breach or default on the part of the Company of any of the terms of
         such Lease will be deemed to have occurred unless we have given notice
         of such breach to the Security Trustee specifying how to make good such
         breach.

We unconditionally and irrevocably waive all rights of set-off, lien,
combination of accounts and similar rights (however described) which we may have
now or in the future to the extent that such rights relate to amounts owed to us
by the Company (and the proceeds thereof) and we will send you copies of all
statements, orders and notices given by us relating to such debt.

This letter is governed by and will be construed in accordance with the laws of
Hong Kong.

Yours faithfully

[Landlord]

                                     - 28 -
<PAGE>

                                     PART B
                      FORM OF NOTICE OF CHARGE OVER ACCOUNT

To:  [Account Bank]

Dear Sirs,

We hereby give you notice, as attorney for and on behalf of G.E.C. (Hong Kong)
Limited (the "Company"), that the Company has, pursuant to a debenture date]
(the "DEBENTURE"), charged to us as Security Trustee for and on behalf of the
Secured Creditors referred to therein, all their rights, title and interest in
and to all sums of money which may now or in the future be held by the Company
with you in any accounts at any of your branches (the "ACCOUNTS"), together with
all interest from time to time earned thereon and the debts represented by such
sums and interest, as well as all book and other debts owed to the Company.

We hereby irrevocably authorise and instruct you:

(a)      to disclose to us without any reference to or further authority from
         the Company and without any enquiry by you as to the justification of
         such disclosure, such information relating to the Accounts and the sums
         therein as we may at any time and from time to time request;

(b)      to hold all sums from time to time standing to the credit of the
         Accounts to our order;

(c)      to pay or release all or any part of the sums from time to time
         standing to the credit of the Accounts in accordance with our written
         instructions at any time or times;

(d)      to comply with the terms of any written notice or instructions in any
         way relating to, or purporting to relate to, the Debenture, the sums
         standing to the credit of the Accounts from time to time or the debts
         represented thereby which you receive at any time from us without any
         reference to or further authority from the Company and without any
         enquiry by you as to the justification for or validity of such notice
         or instruction; and

(e)      to pay all monies received by you for the Accounts to (and only to) the
         credit of those Accounts.

Please note that the Company is not permitted to withdraw any amount from any of
the Accounts without our prior written consent.

Please also note that these instructions are not to be revoked or varied without
our prior written consent.

We confirm that pursuant to Clause 5.2 (Notices of Charge) and Clause 20 (Power
of Attorney) of the Debenture, we are empowered and authorised to deliver this
Notice of Charge for and on behalf of the Company.

This letter is governed by Hong Kong law.

                                     - 29 -
<PAGE>

Please acknowledge receipt of this notice by sending the attached
acknowledgement to us with a copy to the Company.

Yours faithfully,

.. . . . . . . . . . . .
by The Law Debenture Trust Corporation p.l.c.
as attorney for and on behalf of G.E.C. (Hong Kong) Limited

                                     - 30 -
<PAGE>

                             FORM OF ACKNOWLEDGEMENT

To:      The Law Debenture Trust Corporation p.l.c.

Dear Sirs,

We confirm receipt from The Law Debenture Trust Corporation p.l.c. as attorney
for and on behalf of G.E.C. (Hong Kong) Limited (the "COMPANY") of a notice
dated [ ] relating to certain accounts (the "ACCOUNTS") of the Company with the
Bank.

We confirm that:

(i)      we accept the instructions and authorisations contained in that notice
         and we undertake to act in accordance with the terms of that notice;

(ii)     we have not received notice of the interest of any third party in the
         Accounts;

(iii)    we have neither claimed or exercised nor will claim or exercise any
         security interest, set-off, counter-claim or other rights in respect of
         the Accounts, the sums therein or the debts represented thereby without
         your prior written consent;

(iv)     we shall pay all monies received by us for the account of the Company
         to (and only to) the credit of the Account(s) in the name of the
         Company unless otherwise consented to by you; and

(v)      we shall not permit any amount to be withdrawn from any of the Accounts
         without your prior written consent.

Nothing contained in any of our arrangements with you shall commit us to
providing any facilities or making advances available to the Company.

This letter is governed by Hong Kong Law.

Yours faithfully,

.. . . . . . . . . .
On behalf of [Bank]

                                     - 31 -
<PAGE>

                                     PART C

                  FORM OF NOTICE OF CHARGE OVER MONETARY CLAIMS

To:      [              ]

                                                         Date: [               ]

Dear Sirs,

DEBENTURE DATED  [         ]  BY G.E.C.  (HONG KONG) LIMITED (THE "COMPANY") AND
OTHERS AND THE LAW DEBENTURE TRUST CORPORATION P.L.C. (THE "SECURITY TRUSTEE")
(THE "DEBENTURE")

We hereby give you notice, as attorney for and on behalf of the Company, that
the Company has, pursuant to the Debenture, charged to us as Security Trustee
for and on behalf of the Secured Creditors referred to therein all their right,
title and interest in and to [details of Monetary Claim] (the "MONETARY CLAIM")
including all moneys which may be payable in respect of the Claim.

With effect from your receipt of this notice:

5.       all payments by you to the Company under or arising from the Monetary
         Claim should be made to us or to our order as we may specify in writing
         from time to time [details of the account into which sums are to be
         paid may be included];

6.       all remedies available at law or in equity in relation to the Monetary
         Claim are exercisable by us;

7.       all rights to compel performance of the underlying contract in respect
         of the Monetary Claim (the "UNDERLYING CONTRACT") between you and the
         Company are exercisable by us although the Company shall remain liable
         to perform all the obligations assumed by it thereunder;

8.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of the Company arising from the Monetary Claim belong to us and
         no changes may be made to the terms of the Underlying Contract nor may
         the Underlying Contract be terminated without our consent; and

9.      you are authorised and instructed, without requiring further approval
        from the Company, to provide us with such information relating to the
        Monetary Claim as we may from time to time request and to send copies of
        all notices issued by you under the Underlying Contract to us as well as
        to the Company.

These instructions may not be revoked, nor amended, varied or waived without our
prior written consent.

                                     - 32 -
<PAGE>

We confirm that pursuant to Clause 5.2 (Notices of Charge) and Clause 20 (Power
of Attorney) of the Debenture, we are empowered and authorised to deliver this
Notice of Charge for and on behalf of the Company.

This letter is governed by Hong Kong law.

Please acknowledge receipt of this notice by signing the acknowledgement on the
enclosed copy letter and returning it to us at [ ] marked for the attention of
[ ].

Yours faithfully,

.......................

by THE LAW DEBENTURE TRUST CORPORATION P.L.C.
as attorney for and on behalf of
G.E.C. (Hong Kong) Limited

                                     - 33 -
<PAGE>

[On copy only:

To:      THE LAW DEBENTURE TRUST CORPORATION P.L.C. AS SECURITY TRUSTEE

We acknowledge receipt of a notice in the terms set out above and confirm that
we have not received notice of any previous charges of or over any of the
rights, interests and benefits in and to the Monetary Claim and that we will
comply with the terms of that notice.

We further confirm that:

(i)      no amendment, waiver or release of any of such rights, interests and
         benefits shall be effective without your prior written consent;

(ii)     no termination of such rights, interests or benefits shall be effective
         unless we have given you thirty days written notice of the proposed
         termination, specifying the action necessary to avoid such termination.

For and on behalf of [          ]

By:      .............

Dated:

                                     - 34 -
<PAGE>

                                   SCHEDULE 3

                          ADDITIONAL POWERS OF RECEIVER

1.       Take Possession

         Power to enter upon, take immediate possession of, collect and get in
         the Charged Property including without limitation rents and other
         income whether accrued before or after the date of his appointment and
         for that purpose to make, or to require the directors of the Company to
         make, calls conditionally or unconditionally upon the holders of the
         Company's share capital in respect of any such capital of the Company
         which remains uncalled and to enforce payment of calls so made and any
         previous unpaid calls by taking proceedings in the name of the Company
         or in his own name.

2.       Proceedings and Claims

         Power to bring, prosecute, enforce, defend and abandon applications,
         claims, disputes, actions, suits and proceedings in connection with the
         business of the Company or all or any part of the Charged Property or
         this Debenture in the name of the Company or in his own name and to
         submit to arbitration, negotiate, compromise and settle any such
         applications, claims, disputes, actions, suits or proceedings and in
         addition to take or defend proceedings for the compulsory winding-up of
         the Company and proceedings for directions under Section 255 of the
         Companies Ordinance (Cap.32) of the laws of Hong Kong.

3.       Carry on Business

         Power to carry on and manage, or concur in the carrying on and
         management of or to appoint a manager of, the whole or any part of the
         Company's business in such manner as he shall in his absolute
         discretion think fit including without limitation the power to enter
         into any contract or arrangement and to perform, repudiate, rescind or
         vary any contract to which the Company is a party and power to
         supervise, control and finance any subsidiary of the Company or any
         other body corporate (including without limitation any referred to in
         Clause 6 below) and its business and the conduct thereof and to change
         the situation of the registered office of the Company or any such
         subsidiary or other body corporate.

4.       Deal with Charged Property

         Without the need to observe the restrictions imposed by paragraph 11 of
         the Fourth Schedule to the Conveyancing and Property Ordinance
         (Cap.219), power, in relation to the Charged Property and each and
         every part thereof, to sell, transfer, convey, grant or accept
         surrenders of leases, vary, terminate or surrender leases, grant, vary
         or terminate licences or rights of user (in each case with or without
         consideration) or concur in any of the foregoing by the Company or any
         other receiver or manager of the Company (including without limitation
         to or in relation to the Security Trustee or any of the other Secured
         Creditors) in such manner and generally on such terms as he thinks fit
         including without limitation, without the consent of the Company, the
         severing and separate

                                     - 35 -
<PAGE>

         disposal from the premises to which they were affixed of fixtures and
         plant and machinery.

5.       Acquisitions

         Power to purchase, lease, hire or otherwise acquire any assets or
         rights of any description which he shall in his absolute discretion
         consider necessary or desirable for the carrying on, improvement or
         realisation of the whole or any part of the Charged Property or the
         business of the Company or otherwise for the benefit of the whole or
         any part of the Charged Property.

6.       New Subsidiary

         Power to promote, procure the formation or otherwise acquire the share
         capital of, any body corporate with a view to such body corporate
         becoming a subsidiary of the Company or otherwise and purchasing,
         leasing or otherwise acquiring an interest in the whole or any part of
         the Charged Property or carrying on any business in succession to the
         Company or any subsidiary of the Company.

7.       Landlord and Tenant

         Power to make allowances to and re-arrangements with any lessees,
         tenants or other persons from whom any rents and profits may be
         receivable (including granting any licences and operating any rent
         reviews) and to exercise any powers and discretions conferred on a
         landlord or a tenant by any statutory provision or by general law from
         time to time in force in relation to all or any part of the Charged
         Property.

8.       Repairs etc

         Power to undertake, effect or complete any work of repair,
         refurbishment, decoration, modification, building, improvement or
         development of all or any part of the Charged Property as he may think
         expedient and to apply for and obtain any planning permissions,
         building regulation approvals and any other permissions, consents or
         licences in each case as he may in his absolute discretion think fit
         and to acquire (or acquire an interest in) any such property as he may
         think expedient.

9.       Insurance

         Power to effect, maintain or renew indemnity and other insurances and
         to obtain bonds and performance guarantees.

10.      Employment

         Power to employ, engage, dismiss or vary the terms of employment or
         engagement of such employees, workmen, servants, officers, managers,
         agents and advisers on such terms as to remuneration and otherwise as
         he shall think fit including without limitation power to engage his own
         firm in the conduct of the receivership.

                                     - 36 -
<PAGE>

11.      Borrowing

         Power to raise or borrow money from any of the Secured Creditors or any
         other person and with or without a mortgage or charge on the Charged
         Property or any part of it on such terms as he shall in his absolute
         discretion think fit (and no person lending such money shall be
         concerned to see or enquire as to the propriety or purpose of the
         exercise of such power or the application of money so raised or
         borrowed).

12.      Redemption of Security

         Power to redeem, discharge or compromise any security whether or not
         having priority to the security constituted by this Debenture or any
         part of it.

13.      Covenants, Guarantees and Indemnities

         Power to enter into bonds, covenants, guarantees, commitments,
         indemnities and other obligations or liabilities as he shall think fit,
         to make all payments needed to effect, maintain or satisfy such
         obligations or liabilities and to use the company seal of the Company.

14.      Exercise of Powers in Company's Name

         Power to exercise any or all of the above powers on behalf of and in
         the name of the Company (notwithstanding any winding-up or dissolution
         of the Company) or on his own behalf.

                                     - 37 -
<PAGE>

                                   SCHEDULE 4

                                DETAILS OF SHARES

<TABLE>
<CAPTION>
                                                                           Description and Number of
                                                                           Shares Held by the Chargor
Name of Company                         Issued Share Capital               or its nominees
<S>                                     <C>                                <C>
Ilminster Enterprises Limited           HK$10,000                          10,000  ordinary  shares of
                                                                           HK$1 each
</TABLE>

                                     - 38 -
<PAGE>

THE COMPANY

SIGNED, SEALED AND DELIVERED                  )
By       T.C.R SHEPHERD                       )     T.C.R. SHEPHERD
as lawful attorney for and in the name of     )                         [ L.S ]
G.E.C. (HONG KONG) LIMITED                    )
in the presence of:                           )

Signature of witness:       S.J. KNIGHT
Name of witness:            S.J. KNIGHT
Address:                    ALLEN & OVERY
                            ONE NEW CHANGE
                            LONDON EX4M 9QQ
Occupation:                 TRAINEE SOLICITOR

<PAGE>

THE SECURITY TRUSTEE

THE LAW DEBENTURE TRUST CORPORATION P.L.C.

By:               R.D. RANCE

Address:          THE LAW DEBENTURE TRUST COPROPRATION P.L.C.

                  FIFTH FLOOR, 100 WOOD STREET, LONDON EC2V 7EX

Fax:

Attention:        MANAGER, TRUST ADMINISTRATION

Witnessed by:     JOANNE BLAKE<PAGE>

                                                                    EXHIBIT 4.04

                                                                  CONFORMED COPY

                                DATED 19 MAY 2003

                    (1) THE COMPANIES SPECIFIED IN SCHEDULE 1

                 (2) THE LAW DEBENTURE TRUST CORPORATION p.l.c.
                                  (AS TRUSTEE)

            -------------------------------------------------------
                               MORTGAGE DEBENTURE
                               (VARIOUS CHARGORS)
            -------------------------------------------------------

                            MATHESON ORMSBY PRENTICE
                                30 Herbert Street
                                    Dublin 2
                                     Ireland

                              TEL + 353 1 619 9000
                              FAX + 353 1 619 9010

<PAGE>

                                      INDEX

<TABLE>
<S>                                                                                   <C>
1.    Interpretation............................................................       1

2.    Covenant to pay...........................................................       5

3.    Charging clause...........................................................       6

4.    Release of security.......................................................       7

5.    Obligations and liabilities of the Trustee................................       7

6.    Perfection of security....................................................       8

7.    Accounts..................................................................       9

8.    The contracts.............................................................       9

9.    Security over accounts....................................................       9

10.   Covenants.................................................................       9

11.   Enforcement...............................................................      11

12.   Appointment and powers of receiver........................................      11

13.   Protection of third parties...............................................      14

14.   The Trustee entitled to exercise receiver's powers........................      14

15.   Power of attorney.........................................................      14

16.   Trust of leasehold reversion(s)...........................................      15

17.   Consolidation.............................................................      15

18.   Currency Clause...........................................................      15

19.   Security additional.......................................................      16

20.   Continuing security.......................................................      16

21.   Waiver of defences........................................................      16

22.   Non-competition...........................................................      17

23.   Security held by obligor..................................................      17

24.   Conversion of floating charge.............................................      17

25.   Set-off...................................................................      18

26.   Expenses, Costs and Taxes.................................................      18

27.   Further assurance.........................................................      19

28.   Severability..............................................................      19

29.   Remedies, waivers, consents and amendments................................      19

30.   The Trustee's discretion..................................................      20

31.   Notices...................................................................      20

32.   Assignment................................................................      20

33.   Perpetuity Period.........................................................      20

34.   Counterpart Clause........................................................      20

35.   Law and jurisdiction......................................................      20
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                   <C>
36.   Land Act certificate......................................................      21

Schedule 1  The Obligors........................................................      22

Schedule 2  The Scheduled Property..............................................      23

Schedule 3  Form of Notice of Assignment........................................      24

Schedule 4......................................................................      26
</TABLE>

<PAGE>

THIS MORTGAGE DEBENTURE is made on the 19th day of May 2003

BETWEEN:

(1)      THE COMPANIES specified in Schedule 1 (collectively the "OBLIGORS" and
         individually an "OBLIGOR"); and

(2)      THE LAW DEBENTURE TRUST CORPORATION p.l.c.

         having its head office at Fifth Floor 100 Wood Street, London EC2V 7EX,
         England (the "TRUSTEE") as security trustee, for itself and the other
         Secured Creditors (as herein defined).

WHEREAS:-

The Obligors have agreed to provide the security constituted by this Debenture
to the Trustee as trustee for the Secured Creditors.

NOW THIS DEBENTURE WITNESSES:

1.       INTERPRETATION

1.1      In this Debenture (including the recitals) where the context so admits
         or requires:

         "ACCOUNTS" means any credit balance from time to time on any account
         opened or maintained by the Obligors (or any of them) with any
         financial institution and all Related Rights;

         "AFFILIATE" of a person means any Subsidiary or holding company (within
         the meaning given to such expression by section 155 of the Companies
         Act, 1963) of such person or any Subsidiary of any such holding
         company;

         "ANCILLARY COVENANTS" means all covenants, agreements, undertakings,
         warranties, bonds, guarantees, indemnities and other agreements the
         benefit of which is now or hereafter vested in an Obligor in respect of
         the design, construction, fit-out or maintenance of any building,
         structure or erection now or hereafter on the Mortgaged Property or of
         any roads, footpaths or utilities for services now or hereafter
         abutting or serving the Mortgaged Property or the taking in charge
         thereof or the paying of any charge or levy in respect thereof;

         "COLLATERAL RIGHTS" means all rights, powers and remedies of the
         Trustee provided by or pursuant to this Debenture or by law.

         "COMPENSATION RIGHTS" means all present and future rights of the
         Obligors to be paid or receive compensation by reason of any compulsory
         acquisition requisitioning or other exercise of compulsory powers in
         relation to the Mortgaged Property or any refusal withdrawal or
         modification of planning permission or approval relative thereto or any
         control or limitation imposed upon or affecting the use of the
         Mortgaged Property;

         "CONTINUING" in relation to an Enforcement Event, shall be construed as
         a reference to an acceleration of any Secured Obligation (other than
         Secured Obligations arising under the New Bonding Facility Agreement)
         where such acceleration has not been rescinded in writing or a
         declaration that the Secured Obligations (other than Secured
         Obligations arising under the New Bonding Facility Agreement) are
         prematurely due and payable (other than solely as a result of it
         becoming unlawful for a Secured Creditor to perform its obligations
         under the Relevant Documents) where such declaration has not been
         revoked in writing or any failure by an Obligor to pay any principal
         amount in respect of any Secured Obligations (other than Secured
         Obligations arising under the New Bonding Facility Agreement) whether
         on maturity or otherwise which has

                                       1

<PAGE>

         not been remedied or waived in writing. For the purposes of this
         definition, the term "Secured Obligations" shall have the same meaning
         as in the Security Trust and Intercreditor Deed;

         "CONTRACTS" means any contract between an Obligor and any member of the
         Group pursuant to which such Obligor makes available loans or a loan to
         such member of the Group and all Related Rights;

         "DELEGATE" means any delegate, agent, attorney, co-trustee or
         additional but separate committee, custodian, depository or Receiver
         appointed by the Trustee in accordance with the terms hereof and/or the
         Security Documents;

         "ENFORCEMENT EVENT" has the meaning given to such term in the Security
         Trust and Intercreditor Deed;

         "GROUP" means Marconi Corporation and its Subsidiaries for the time
         being;

         "INSOLVENCY EVENT OF DEFAULT" means any Insolvency Event which is also
         an Event of Default.

         "INSURANCES" means all policies of insurance now or hereafter taken out
         by the Obligors or any of them or the benefit of which is now or
         hereafter enjoyed or held by the Obligors or any of them and all monies
         from time to time payable thereunder including all returns of premium
         and all Related Rights;

         "INTERIM BONDING FACILITY DOCUMENTS" means the Bonding Documents
         referred to in the Interim Bonding Facility Letter;

         "INTERIM BONDING FACILITY LETTER" means the facility letter dated 10
         May 2002, as amended on 24 October 2002, between HSBC Bank plc,
         Barclays Bank PLC, JPMorgan Chase Bank and Marconi Bonding Limited in
         an amount up to L150,000,000 (or the equivalent in other currencies)
         for the issuance of bonds, guarantees, letters of credit, indemnities
         and similar instruments;

         "INTELLECTUAL PROPERTY" means all industrial and intellectual property
         rights whether registered or not including pending applications for
         registration of such rights and the right to apply for registration of
         such rights including but not limited to Patents (as defined in the
         Indentures), utility models, design patents, registered designs, design
         rights, trade and service marks, copyrights (including copyright and
         equivalent rights in computer software), rights in inventions,
         technical information, rights in know-how, business names, database
         rights, processes, models, formulae and experiments and all rights of
         equivalent or similar effect to any of those which may subsist anywhere
         in the world and all Related Rights;

        "INVESTMENTS" means

         (a)      any stocks, shares, debentures, securities and certificates of
                  deposit;

         (b)      all interests in collective investment schemes; and

         (c)      all warrants, options and other rights to subscribe or acquire
                  any of the investments described in (a) and (b),

         in each case whether held directly by or to the order of any Obligor or
         by any trustee, nominee, fiduciary or clearance system on its behalf
         and all Related Rights (including all rights against any such trustee,
         nominee, fiduciary or clearance system).

         "MARCONI CORPORATION" means Marconi Corporation plc (Company number
         00067307);

                                       2

<PAGE>

         "MONETARY CLAIMS" means any book and other debts and monetary claims
         owing to the Obligors or either of them and any proceeds thereof
         including, without limitation, any claims or sums of money deriving
         from or in relation to any Intellectual Property, the proceeds of any
         Insurances, any court order or judgment, any contract or agreement to
         which an Obligor is a party and any other assets, property, rights or
         undertaking of the Obligors and all Related Rights;

         "MORTGAGED PROPERTY" means the Scheduled Property and the Other
         Property;

         "NEW BONDING FACILITY AGREEMENT" means the L50 million committed
         revolving bonding facility agreement dated 27 March 2003 among Marconi
         Corporation, Marconi Bonding Limited, HSBC Bank plc as agent and
         security trustee, the lenders described thereunder and certain other
         Subsidiaries providing for the issuance of surety bonds, appeal bonds,
         bid bonds, performance bonds, letters of credit, bank guarantees or
         other obligations of a like nature on behalf of Marconi Corporation
         and/or any Subsidiary, as such agreement may be amended, extended,
         supplemented or otherwise modified from time to time (including,
         without limitation, any successive amendments, extensions, supplements
         or other modifications of the foregoing);

         "NOTICE OF ASSIGNMENT" means a notice of assignment in substantially
         the form set out in Schedule 3;

         "NOTICE OF CHARGE" means a notice of charge in substantially the form
         set out in Schedule 4;

         "OBLIGORS" includes their respective successors and permitted assigns
         (whether immediate or derivative);

         "OTHER PROPERTY" means all freehold, leasehold and other immoveable
         property, other than the Scheduled Property, now or at any time
         hereafter belonging to or for any estate or interest vested in any
         Obligor together with all rights, liberties, powers, easements, quasi
         easements and appurtenances (in each case of whatever nature) attached
         or appurtenant thereto and all buildings, erections, fixtures, fittings
         (including trade fixtures and fittings) and fixed plant and machinery
         from time to time therein or thereon and all Related Rights;

         "PLANT AND MACHINERY" means any plant, machinery, office equipment,
         computers, vehicles and other chattels (excluding any for the time
         being forming part of the Obligors' stock-in-trade or work in progress)
         and all Related Rights;

         "REAL PROPERTY" means:

         (a)      any freehold, leasehold, heritable or immovable property
                  (including the Scheduled Property), and

         (b)      any buildings, fixtures, fittings, fixed plant or machinery
                  from time to time situated on or forming part of such freehold
                  or leasehold property,

         (c)      any present or future freehold, heritable or leasehold
                  property in which any Obligor has an interest,

         and includes all Related Rights;

         "RECEIVER" has the meaning assigned to it in clause 12.1;

         "RELATED RIGHTS" means, in relation to any asset:

         (a)      the proceeds of sale or assignment of any part of that asset;

                                       3

<PAGE>

         (b)      all rights under any licence, agreement for sale or agreement
                  for lease in respect of that asset;

         (c)      all rights, benefits, claims, contracts, warranties, remedies,
                  security, indemnities or covenants for title in respect of
                  that asset; and

         (d)      any moneys and proceeds paid or payable in respect of that
                  asset including, but not limited to royalties, licence
                  payments, awards of damages and payments made pursuant to
                  settlement agreements in respect of that asset.

         "SCHEDULED PROPERTY" means the property described in Schedule 2, or
         when used in relation to a particular Obligor, such of the properties
         described in Schedule 2 as are owned by it at the relevant time, in
         each case together with (by way of extension of Section 6 of the
         Conveyancing Act 1881) all rights, liberties, powers, easements, quasi
         easements and appurtenances (in each case of whatever nature) attached
         or appurtenant thereto and all buildings, erections, fixtures, fittings
         (including trade fixtures and fittings) and fixed plant and machinery
         from time to time therein or thereon and all Related Rights;

         "SECURED ASSETS" means all assets, rights, property and revenues of
         each Obligor the subject of any security created or expressed or
         intended to be created by or pursuant to this Debenture and where the
         context so permits any reference to the "Secured Assets" includes a
         reference to any of them;

         "SECURED OBLIGATIONS" means, in relation to an Obligor, all present and
         future indebtedness, liabilities and obligations (for the avoidance of
         doubt, including any liabilities and obligations which have been
         cash-collateralised by the Obligors) at any time of the relevant
         Obligor under the Relevant Documents, both actual and contingent and
         whether incurred solely or jointly or in any other capacity together
         with any of the following matters relating to or arising in respect of
         those liabilities and obligations:

         (a)      any refinancing, novation, deferral or extension;

         (b)      any obligation relating to any increase in the amount of such
                  obligations;

         (c)      any claim for damages or restitution; and

         (d)      any claim as a result of any recovery by an Obligor of a
                  payment or discharge, or non-allowability, on the grounds of
                  preference,

         and any amounts which would be included in any of the above but for any
         discharge, non-provability or unenforceability of those amounts in any
         insolvency or other proceedings (including interest accruing after the
         commencement of any insolvency or other proceedings);

         "SECURITY TRUST AND INTERCREDITOR DEED" means the security trust and
         intercreditor deed dated on or about the date hereof between, amongst
         others, the Trustee, Marconi Corporation as Issuer and other obligors,
         Law Debenture Trust Company of New York as senior note trustee,
         JPMorgan Chase Bank as junior note trustee and HSBC Bank plc as New
         Bonding Facility Agent;

         "SUBSIDIARY" has the same meaning as in Section 155 of the Companies
         Act, 1963;

         "TEMPORARY BONDING FACILITY DOCUMENTS" means the Bonding Documents
         referred to in the Temporary Bonding Facility Letter;

         "TEMPORARY BONDING FACILITY LETTER" means the facility letter dated 8
         February 2002 between HSBC Bank plc. Barclays Bank PLC and Marconi
         Bonding Limited in an amount up to

                                       4

<PAGE>

         L50,000,000 (or equivalent in other currencies) for the issuance of
         bonds, guarantees, letters of credit, indemnities and similar
         instruments; and

         "TRUSTEE" includes any person for the time being appointed as trustee
         or as an additional trustee for the purpose of, and in accordance with,
         the Security Trust and Intercreditor Deed.

1.2      In this Debenture:-

         1.2.1    any reference to a person shall be construed as a reference to
                  any person, firm, company, corporation, government, state or
                  agency of any government or state or any association or
                  partnership (whether or not having separate legal personality)
                  of any two or more of the foregoing;

         1.2.2    any reference to any statutory provision, order or regulation
                  shall include reference to any extension, modification,
                  replacement or re-enactment thereof (whether made before or
                  after the date hereof) from time to time in force and all
                  regulations and orders from time to time made thereunder and
                  any analogous provision or rule under any applicable law for
                  the time being in force;

         1.2.3    any reference to any agreement or other instrument (including,
                  without limitation, this Debenture) shall be deemed to be a
                  reference to such agreement or instrument as amended, novated
                  or replaced from time to time and all agreements or other
                  instruments supplemental thereto;

         1.2.4    words denoting the singular include the plural and vice versa
                  and words denoting any gender include all genders;

         1.2.5    any reference to a clause or schedule is, unless otherwise
                  stated, a reference to a clause of or schedule to this
                  Debenture;

         1.2.6    "L" means pounds sterling, the lawful currency of the United
                  Kingdom;

         1.2.7    headings are for reference purposes only and shall not affect
                  the interpretation of this Debenture; and

         1.2.8    any reference to the guarantee given herein by an Obligor
                  shall include a reference to any indemnity given herein by
                  such Obligor in respect of the liabilities of the other
                  Obligors.

1.3      Capitalised terms used and not otherwise defined herein shall have the
         meanings given to them in the Security Trust and Intercreditor Deed.

1.4      The parties hereto each acknowledge that the Trustee, when acting
         hereunder, shall be acting in accordance with and subject to the terms
         of the Security Trust and Intercreditor Deed.

1.5      Notwithstanding any provision to the contrary contained herein, the
         parties agree that this Debenture is subject in all respects to the
         terms of the Security Trust and Intercreditor Deed and for the
         avoidance of doubt, in the event of any inconsistency, the provisions
         of the Security Trust and Intercreditor Deed shall prevail.

2.       COVENANT TO PAY

2.1      Each Obligor hereby covenants with the Trustee as trustee for the
         Secured Creditors that it shall on demand of the Trustee discharge all
         the Secured Obligations and each Obligor shall pay to the Trustee when
         due and payable every sum at any time owing, due or incurred by that
         Obligor to the Trustee (whether for its own account or as trustee for
         the Secured Creditors) or any of the other

                                       5

<PAGE>

         Secured Creditors in respect of any such liabilities PROVIDED THAT
         neither such covenant nor the security constituted by this Debenture
         nor any other provisions of this Debenture shall extend to or include
         any liability or sum which would, but for this proviso, cause such
         covenant, security or provision to be unlawful or prohibited by any
         applicable law (including, for the avoidance of doubt, Section 60 of
         the Companies Act, 1963).

2.2      All payments to be made under this Debenture by any Obligor shall be
         made free and clear of and without deduction for or on account of
         either any set-off or counterclaim or any present or future taxes,
         levies, imposts, duties, charges, fees, deductions or withholdings of
         any nature whatsoever. If any Obligor shall at any time be compelled by
         law to make any deduction or withholding from any payment to be made
         hereunder such Obligor will concurrently pay to the Trustee or, as the
         case may be, the Secured Creditor concerned such additional amount as
         will result in payment to the Trustee or, as the case may be, the
         Secured Creditor concerned of the full amount which would have been
         received if such deduction or withholding had not been made.

2.3      If an Obligor fails to pay any sum on the due date for payment of that
         sum such Obligor shall pay interest on any such sum (before and after
         any judgment and to the extent interest at a default rate is not
         otherwise being paid on such sum) from the date of demand until the
         date of payment calculated on a daily basis at the rate determined in
         accordance with the provisions of clause 18.4 (Interest on Demands) of
         the Security Trust and Intercreditor Deed.

3.       CHARGING CLAUSE

         As continuing security for the payment and discharge of the Secured
         Obligations each Obligor as beneficial owner (and also in the case of
         registered land as registered owner or the person entitled to be
         registered as registered owner) hereby:

3.1      LEGAL MORTGAGES AND SECURITY ASSIGNMENTS

         3.1.1    grants and conveys unto the Trustee (as trustee as aforesaid)
                  so much of the Scheduled Property as is of freehold tenure
                  (save any part the ownership whereof is registered or is in
                  the course of being registered in the Land Registry but
                  including any part thereof which is held additionally for any
                  other freehold estate or interest) to hold the same unto and
                  to the use of the Trustee in fee simple; and

         3.1.2    demises unto the Trustee (as trustee as aforesaid) so much of
                  the Scheduled Property as is of leasehold tenure (save any
                  part thereof the leasehold ownership whereof is registered or
                  is in the course of being registered in the Land Registry but
                  including any part thereof which is held additionally for any
                  other leasehold tenure estate or interest) to hold the same
                  unto the Trustee for all the residue of the term or respective
                  terms of years for which it holds the same less the last day
                  of such term or terms; and

         3.1.3    charges unto the Trustee (as trustee as aforesaid) so much of
                  the Scheduled Property the ownership whereof, or in the case
                  of leasehold property the leasehold interest whereof, is
                  registered or is in course of being registered in the Land
                  Registry with payment of the Secured Obligations and it
                  assents to the registration of this charge as a burden on all
                  the property affected thereby; and

         3.1.4    charges unto the Trustee (as trustee as aforesaid) by way of
                  first fixed charge any future estate or interest which it may
                  from time to time hereafter acquire in the Scheduled Property;
                  and

         3.1.5    assigns unto the Trustee all its right title and interest in
                  and to and the full benefit of the Contracts to hold the same
                  unto the Trustee absolutely; and

                                       6

<PAGE>

         3.1.6    assigns unto the Trustee the Ancillary Covenants to hold the
                  same unto the Trustee absolutely; and

         3.1.7    assigns unto the Trustee the Compensation Rights to hold the
                  same unto the Trustee absolutely.

3.2      FIXED CHARGES

         Charges unto the Trustee by way of first fixed charge:-

         3.2.1    so much of the Scheduled Property as is held under any yearly
                  or lesser tenancy interest; and

         3.2.2    any future estate or interest which it may from time to time
                  hereafter acquire in the Scheduled Property; and

         3.2.3    the Other Property; and

         3.2.4    the Plant and Machinery; and

         3.2.5    all Monetary Claims deriving from or in relation to any
                  Intellectual Property or the proceeds of any Insurances
                  relating to the Real Property secured under this Debenture;
                  and

         3.2.6    any goodwill; and

         3.2.7    all its rights in relation to its uncalled capital; and

3.3      FLOATING CHARGE

         Charges unto the Trustee by way of floating charge all its undertaking
         property and assets whatsoever and wheresoever situate in the world
         both present and future not effectually subject to any legal mortgage,
         security assignment or fixed charge hereby created or evidenced or
         validly and effectively charged or assigned (whether in law or in
         equity) in favour of the Trustee by way of fixed security under the
         laws of the jurisdiction in which that asset is situated.

4.       RELEASE OF SECURITY

         The Trustee shall, at the cost of the Obligors, release and cancel the
         security constituted by this Debenture and procure the reassignment to
         the Obligors of the property and assets assigned to the Trustee
         pursuant to this Debenture in accordance with the terms and subject to
         the conditions and circumstances set out in the Security Trust and
         Intercreditor Deed, and without recourse to, or any representation or
         warranty by, the Trustee or any of its nominees.

5.       OBLIGATIONS AND LIABILITIES OF THE TRUSTEE

         None of the provisions of clause 3 shall be deemed to impose on the
         Trustee or imply on its part any obligation or other liability
         whatsoever in relation to the Secured Assets or to constitute the
         Trustee or any other Secured Creditor a mortgagee in possession.

         The parties hereto hereby acknowledge that the covenants of the
         Obligors contained in this Debenture and the security and other rights,
         titles and interests constituted by this Debenture and the Secured
         Assets and all other moneys, property and assets paid to the Trustee or
         held by the Trustee pursuant to or in connection with this Debenture
         are held by the Trustee subject to and on the terms of the trusts
         declared in the Security Trust and Intercreditor Deed.

                                       7

<PAGE>

6.       PERFECTION OF SECURITY

6.1      ACCOUNTS AND MONETARY CLAIMS

         6.1.1    Each Obligor shall within 10 Business Days after the date of
                  this Debenture provide the Trustee with details of all
                  Accounts and Monetary Claims arising from any Insurances
                  relating to the Real Property secured under this Debenture or
                  deriving from or relating to any Intellectual Property and in
                  relation to all other Accounts and Monetary Claims,
                  immediately upon the occurrence of an Insolvency Event of
                  Default or upon request by the Trustee if instructed pursuant
                  to the Security Trust and Intercreditor Deed upon or after the
                  occurrence of any Event of Default which is continuing, to
                  enable the Trustee to deliver a Notice of Charge in accordance
                  with sub-clause 6.1.2 and/or sub-clause 6.1.3 below.

         6.1.2    Pursuant to clause 15, the Trustee may, upon the occurrence of
                  an Insolvency Event of Default, and shall, if so instructed
                  pursuant to the Security Trust and Intercreditor Deed upon or
                  at any time after the occurrence of any Event of Default which
                  is continuing, deliver to relevant persons, Notices of Charge
                  duly executed by the Trustee on behalf of the relevant Obligor
                  or Obligors in respect of any Monetary Claims.

         6.1.3    Pursuant to clause 15, the Trustee may, upon the occurrence of
                  an Insolvency Event of Default, and shall, if so instructed
                  pursuant to the Security Trust and Intercreditor Deed upon or
                  at any time after the occurrence of any Event of Default which
                  is continuing, deliver to relevant persons, Notices of Charge
                  duly executed by the Trustee on behalf of the relevant Obligor
                  or Obligors in respect of any Accounts.

6.2      CONTRACTS

         Pursuant to clause 15, the Trustee may, upon the occurrence of an
         Insolvency Event of Default, and shall, if so instructed pursuant to
         the Security Trust and Intercreditor Deed upon or at any time after the
         occurrence of any Event of Default which is continuing, deliver to
         relevant persons Notices of Assignment duly executed by the Trustee on
         behalf of the Obligors (or any of them) in respect of the Contracts.
         Prior to the delivery of a Notice of Assignment or the occurence of an
         Enforcement Event, each Obligor shall be entitled to deal with the
         Contracts except as expressly prohibited under the Indentures or the
         Security Trust and Intercreditor Deed.

6.3      LEASES

         Within 10 Business Days after the date of this Debenture, the relevant
         Obligor or Obligors will join the Trustee in giving notice to all
         landlords and other persons which are parties under all leases relating
         to the Scheduled Property in existence on the date of this Debenture in
         the form of the Notice of Charge contained at Schedule 4 Part A and
         will use all commercially reasonable endeavours to procure from each of
         such landlords and persons an acknowledgement in the form attached
         thereto.

         If so required by the Trustee from time to time, within 10 Business
         Days after any Obligor enters into any lease with any person, the
         relevant Obligor or Obligors will join the Trustee in giving notice to
         all such landlords and other persons of the fixed security constituted
         under this Debenture in respect of any such lease in the form of the
         Notice of Charge contained at Schedule 4 Part A and will use all
         commercially reasonable endeavours to procure from each of such
         landlords and persons an acknowledgement in the form attached thereto.

                                       8

<PAGE>

7.       ACCOUNTS

7.1      OPERATION BEFORE ENFORCEMENT EVENT

         Each Obligor shall, prior to the delivery of a Notice of Charge
         pursuant to clause 6.1 or the occurrence of an Enforcement Event and at
         any time thereafter when no Enforcement Event is continuing (provided
         that at such time no Notice of Charge has been delivered pursuant to
         clause 6.1) be entitled to receive, withdraw or otherwise transfer any
         credit balance from time to time on any Account.

7.2      OPERATION AFTER ENFORCEMENT EVENT

         After the delivery of a Notice of Charge pursuant to clause 6.1 or the
         occurrence of an Enforcement Event and at any time thereafter while
         such Enforcement Event is continuing, the Obligors shall not be
         entitled to receive, withdraw or otherwise transfer any credit balance
         from time to time on any Account except with the prior consent of the
         Trustee.

         The Trustee shall, upon the occurrence of an Enforcement Event and at
         any time thereafter while such Enforcement Event is continuing, be
         entitled without notice to apply, transfer or set-off any or all of the
         credit balances from time to time on any Account in or towards the
         payment or other satisfaction of all or any part of the Secured
         Obligations in accordance with clause 12.6.

8.       THE CONTRACTS

         [Intentionally left blank]

9.       SECURITY OVER ACCOUNTS

         The security created by clause 3.3 over the Accounts shall take effect
         subject to, and shall not restrict the ability of any Obligor to
         create, any (a) security or (b) other arrangement under which money or
         claims to, or the benefit of, a bank or other account may be applied,
         set-off, made subject to a combination of accounts or otherwise subject
         to time deposit arrangements (whether or not such security is or is to
         be created on, before or after the date of this Debenture) which
         secures obligations under and/or in respect of:

         (a)      the Interim Bonding Facility Documents;

         (b)      the Temporary Bonding Facility Documents;

         (c)      the New Bonding Facility Agreement;

         (d)      the Existing Performance Bonds; and

         (e)      any other bonding facility expressly permitted pursuant to
                  Section 4.07 (Limitations on Indebtedness and Preferred Stock)
                  of the Senior Note Indenture and Section 4.06 (Limitations on
                  Indebtedness and Preferred Stock) of the Junior Note
                  Indenture,

         in each case as a result of the provision of cash collateral as
         permitted pursuant to the terms of the Indentures or any of them, the
         Escrow Agreement or the Security Trust and Intercreditor Deed.

10.      COVENANTS

10.1     Each Obligor hereby covenants with the Trustee (as trustee as
         aforesaid) that until this security is discharged it shall:-

                                       9

<PAGE>

         DOCUMENTS OF TITLE

         10.1.1   DEPOSIT TITLE DEEDS: deposit with the Trustee, or to the order
                  of the Trustee, within 10 Business Days of the date hereof and
                  permit the Trustee to retain as part of the security hereby
                  constituted the deeds and documents of title of the Mortgaged
                  Property;

         10.1.2   ADDITIONAL PROPERTY: promptly inform the Trustee upon
                  acquiring any additional Real Property and to the extent
                  required by the Trustee (i) deposit (or procure deposit) with
                  the Trustee, or to the order of the Trustee, and permit the
                  Trustee to retain as part of the security hereby constituted
                  the deeds and documents of title thereof and (ii) enter into
                  any further legal or other mortgages or charges in favour of
                  the Trustee in respect thereof as the Trustee may require;

         MONETARY CLAIMS

         10.1.3   DEALING WITH MONETARY CLAIMS: not at any time during the
                  subsistence of the Debenture, without the prior written
                  consent of the Trustee or except as not expressly prohibited
                  under the terms of the Indentures:

                  (a)      deal with the Monetary Claims referred to in clause
                           3.2.5 except by getting in and realising them in a
                           prudent manner (on behalf of the Trustee) and paying
                           the proceeds of those Monetary Claims into the
                           Accounts or as the Trustee may require (and such
                           proceeds shall be held upon trust for the Trustee on
                           behalf of the Secured Creditors prior to such payment
                           in);

                  (b)      factor or discount any of the Monetary Claims
                           referred to in clause 3.2.5 or enter into any
                           agreement for such factoring or discounting; or

                  (c)      be entitled to withdraw or otherwise transfer the
                           proceeds of the realisation of any Monetary Claims
                           standing to the credit of any Account, PROVIDED
                           ALWAYS THAT prior to the delivery of a Notice of
                           Charge pursuant to clause 6 or the occurrence of an
                           Enforcement Event and at any time when no Enforcement
                           Event is continuing (provided that at such time no
                           Notice of Charge has been delivered pursuant to
                           clause 6), the proceeds of the realisation of any
                           Monetary Claims deriving from or in relation to any
                           Intellectual Property or the proceeds of any
                           Insurances relating to the Real Property secured
                           under this Debenture shall (subject to any
                           restriction on the application of such proceeds
                           contained in this Debenture, the Indentures or in the
                           Security Trust and Intercreditor Deed), upon such
                           proceeds being credited to an Account, be released
                           from the fixed charge created pursuant to clause 3.2
                           and the Obligors shall be entitled to withdraw such
                           proceeds from such Account provided that such
                           proceeds shall continue to be subject to the floating
                           charge created pursuant to the terms of this
                           Debenture.

10.2     Each Obligor undertakes that it shall not, at any time during the
         subsistence of this Debenture, create or permit to subsist any Security
         over all or any part of the Secured Assets except as not expressly
         prohibited under the terms of the Indentures.

10.3     Each Obligor undertakes that it shall not (and shall not agree to) at
         any time during the subsistence of this Debenture, except as not
         expressly prohibited under the terms of the Indentures:

         10.3.1   execute any conveyance, disposition, transfer, lease,
                  assignment or assignation of, or other right to use or occupy,
                  all or any part of the Secured Assets;

         10.3.2   create any legal or equitable estate or heritable interest or
                  other interest in, or over, or otherwise relating to, all or
                  any part of the Secured Assets; or

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         10.3.3   (a) grant or vary, or accept any surrender, or cancellation or
                  renunciation or disposal of, any lease, tenancy, licence,
                  consent or other right to use or occupy in relation to any of
                  the Secured Assets or (b) allow any person any right to use or
                  occupy or to become entitled to assert any proprietary
                  interest in, or right over, the Secured Assets, which may, in
                  each case, adversely affect the ability of the Trustee to
                  exercise any of the Collateral Rights.

10.4     After the occurrence of an Enforcement Event (which is continuing),
         each Obligor shall promptly deliver (or procure delivery) to the
         Trustee, and the Trustee shall be entitled to retain, all of the
         Investments and any certificates and other documents of title
         representing the Investments to which that Obligor (or its nominee(s))
         is or becomes entitled together with any other document which the
         Trustee may request (in such form and executed as the Trustee may
         require) with a view to perfecting or improving its security over the
         Investments or to registering any Investment in its name or the name of
         any nominee(s).

11.      ENFORCEMENT

         At any time after the occurrence of an Enforcement Event (once the
         Trustee (acting on instructions received pursuant to the terms of the
         Security Trust and Intercreditor Deed) gives notice thereof to the
         Obligors) the security constituted by this Debenture shall become
         immediately enforceable and the power of sale and the other powers
         conferred on a mortgagee by the Conveyancing Acts 1881 to 1911 as
         varied or extended by this Debenture shall become immediately
         exercisable without the restrictions contained in Section 20 of the
         Conveyancing Act 1881 as to the giving of notice or otherwise.

12.      APPOINTMENT AND POWERS OF RECEIVER

12.1     At any time after the occurrence of an Enforcement Event (which is
         continuing) or at any time after any Obligor so requests the Trustee
         may from time to time appoint under seal or under hand of a duly
         authorised officer or employee of the Trustee any person or persons to
         be receiver and manager or receivers and managers (herein called
         "Receiver" which expression shall where the context so admits include
         the plural and any substituted receiver and manager or receivers and
         managers) of the Secured Assets or any part or parts thereof and from
         time to time under seal or under hand of a duly authorised officer of
         the Trustee remove any Receiver so appointed and may so appoint another
         or other in his stead. If the Trustee appoints more than one person as
         Receiver of any of the Secured Assets, each such person shall be
         entitled (unless the contrary shall be stated in the appointment) to
         exercise all the powers and discretions hereby or by statute conferred
         on Receivers individually and to the exclusion of the other or others
         of them.

12.2     The foregoing powers of appointment of a Receiver shall be in addition
         to and not to the prejudice of all statutory and other powers of the
         Trustee under the Conveyancing Acts 1881 to 1911 (and so that any
         statutory power of sale shall be exercisable without the restrictions
         contained in Section 20 of Conveyancing Act, 1881) or otherwise and so
         that such powers shall be and remain exercisable by the Trustee in
         respect of any part of the Secured Assets notwithstanding the
         appointment of a Receiver thereover or over any other part of the
         Secured Assets.

12.3     A Receiver so appointed shall at all times and for all purposes be the
         agent of the Obligor for which he is appointed and such Obligor shall
         be solely responsible for his acts default and remuneration.

12.4     A Receiver so appointed to an Obligor shall have and be entitled to
         exercise all powers conferred by the Conveyancing Acts 1881 to 1911 in
         the same way as if the Receiver had been duly appointed thereunder and
         shall furthermore, but without limiting any powers hereinbefore
         referred to, have power to do the following things either in his own
         name or in the name of such Obligor:-

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         12.4.1   TAKE POSSESSION: to take immediate possession of, get in and
                  collect the Secured Assets or any part thereof and for that
                  purpose to make, or to require the directors of such Obligor
                  to make, calls upon the holders of such Obligor's share
                  capital in respect of any such capital of such Obligor which
                  remains uncalled and to enforce payment of calls by taking
                  proceedings in the name of such Obligor or his own name;

         12.4.2   CARRY ON BUSINESS: to manage and carry on any business of such
                  Obligor including entering into any contract or arrangement
                  and performing, repudiating, rescinding or varying any
                  contract or arrangement to which such Obligor is party;

         12.4.3   DEAL WITH SECURED ASSETS: to sell, transfer, assign, exchange,
                  hire out, lend, grant leases, tenancies and rights of user,
                  grant renewals and accept surrenders of leases, tenancies,
                  licences or rights of user and otherwise dispose of or realise
                  the Secured Assets (including any fixtures, which may be sold
                  separately from the premises containing them), either by
                  public offer or auction, tender or private contract and for
                  rents, premiums or other compensation or consideration and so
                  that (without limitation) he may do any of these things for a
                  consideration consisting of cash, debentures, or other
                  obligations, investments or other valuable consideration of
                  any kind and any such consideration may be payable or
                  delivered in a lump sum or by instalments spread over such
                  period as he may think fit;

         12.4.4   HIVE DOWN: without prejudice to the generality of clause
                  12.4.3 above, to do any of the following acts and things:-

                  (i)      to promote or procure the formation of any new
                           corporation;

                  (ii)     to subscribe for or acquire (for cash or otherwise)
                           any investment in or of such new corporation;

                  (iii)    to sell, transfer, assign, hire out and lend, and
                           grant leases, tenancies and rights of user of, the
                           Secured Assets to any such new corporation and accept
                           as consideration or part of the consideration
                           therefore any shares or other security in or of any
                           corporation or allow the payment of the whole or any
                           part of such consideration to remain deferred or
                           outstanding;

                  (iv)     to sell, transfer, assign, exchange and otherwise
                           dispose of or realise any such shares or other
                           security or deferred consideration or part thereof or
                           any rights attaching thereto

         12.4.5   BORROW MONEY: for the purpose of exercising any of the powers
                  conferred on him by or pursuant to this Debenture and/or of
                  defraying any costs, charges, losses, liabilities or expenses
                  (including his remuneration) incurred by or due to him in the
                  exercise thereof and/or for any other purpose, to borrow or
                  raise money either unsecured or on the security of the Secured
                  Assets (either in priority to the security hereby created or
                  otherwise) and generally on such terms and conditions as he
                  may think fit;

         12.4.6   COVENANTS AND GUARANTEES: to enter into bonds, covenants,
                  commitments, guarantees, indemnities and like matters and to
                  make all payments needed to effect, maintain or satisfy the
                  same;

         12.4.7   DEALING WITH TENANTS: to reach agreements and make
                  arrangements with, and to make allowances to, any lessees,
                  tenants or other person from whom any rents and profits may be
                  receivable (including those relating to the grant of any
                  licences, the review of rent in accordance with the terms of,
                  and the variation of, the provisions of any leases, tenancies,
                  licences or rights of user affecting the Secured Assets);

                                       12

<PAGE>

         12.4.8   RIGHTS OF OWNERSHIP: to manage and use the Secured Assets and
                  to exercise and do (or permit such Obligor or any nominee of
                  it to exercise and do) all such rights and things as the
                  Receiver would be capable of exercising or doing if he were
                  the absolute beneficial owner of the Secured Assets and in
                  particular, without limitation, to exercise all rights
                  attaching to the Secured Assets and to arrange for or provide
                  all services which he may deem proper for the efficient
                  management or use of the Secured Assets or the exercise of
                  such rights;

         12.4.9   REPAIRS, IMPROVEMENTS, ETC: to make and effect decorations,
                  repairs, structural and other developments, alterations,
                  improvements and additions in or to the Secured Assets
                  (including, without limitation, the development or
                  redevelopment of any premises thereon) and to purchase or
                  otherwise acquire any materials, articles or things and do
                  anything else in connection with the Secured Assets as he may
                  think desirable for the purpose of making them productive or
                  more productive, increasing their letting or market value or
                  protecting the security hereby constituted;

         12.4.10  CLAIMS: to settle, adjust, refer to arbitration, compromise
                  and arrange any claims, accounts, disputes, questions and
                  demands with or by any person who is or claims to be a
                  creditor of such Obligor or relating in any way to the Secured
                  Assets;

         12.4.11  LEGAL ACTION: to bring, prosecute, enforce, defend and abandon
                  actions, suits and proceedings in relation to the Secured
                  Assets or any of the businesses of such Obligor;

         12.4.12  REDEMPTION OF SECURITIES: to redeem any Security (whether or
                  not having priority to the security hereby created) over the
                  Secured Assets and to settle the accounts of encumbrancers;

         12.4.13  EMPLOYEES, ETC: to appoint, hire and employ officers,
                  employees, contractors, agents and advisors of all kinds and
                  to discharge any such persons and any such persons appointed,
                  hired or employed by such Obligor;

         12.4.14  OTHER POWERS: do all such other acts and things as he may
                  consider desirable or necessary for realising the Secured
                  Assets or any part thereof or incidental or conducive to any
                  of the matters, powers or authorities conferred on a Receiver
                  under or by virtue of this Debenture and to exercise in
                  relation to the Secured Assets or any part thereof all such
                  powers, authorities and things as he would be capable of
                  exercising if he were the absolute beneficial owner of the
                  same; and to use the name of such Obligor for all or any of
                  the purposes aforesaid;

         Provided nevertheless that a Receiver shall not be authorised to
         exercise any of the aforesaid powers, authorities and discretions if
         and insofar and so long as the Trustee shall in writing exclude the
         same whether at the time of his appointment or subsequently.

12.5     If the Trustee appoints a Receiver of part only of the Secured Assets
         the powers conferred on a Receiver by clause 12.4 shall have effect as
         though every reference in that clause to the "Secured Assets" were a
         reference to such of the Secured Assets or any of them in respect of
         which such Receiver has been appointed.

12.6     Any monies received by the Trustee or by any Receiver shall, after the
         security hereby constituted has become enforceable but subject to the
         payment of any claims having priority to this security, be applied in
         accordance with the terms of the Security Trust and Intercreditor Deed.

12.7     Neither the Trustee nor any Secured Creditor nor any Receiver shall be
         liable to account as mortgagee in possession in respect of the Secured
         Assets or any part thereof nor be liable for any loss upon realisation
         or in connection with the Secured Assets or any part thereof for which
         a

                                       13

<PAGE>

         mortgagee in possession might as such be liable and all costs charges
         and expenses incurred by the Trustee or any Secured Creditor or any
         Receiver (including the costs of any proceedings to enforce the
         security hereby given) shall be paid by the Obligors on a solicitor and
         own client basis and so charged on the Secured Assets.

13.      PROTECTION OF THIRD PARTIES

13.1     No purchaser or other person shall be bound or concerned to see or
         enquire whether the right of the Trustee, any Delegate or any Receiver
         to exercise any of the powers, authorities and discretions hereby
         conferred has arisen or become exercisable or be concerned with the
         propriety of the exercise or purported exercise of such powers.

13.2     The receipt of the Trustee, any Delegate or any Receiver shall be an
         absolute and conclusive discharge to a purchaser or other person and
         shall relieve him of any obligation to see to the application of any
         monies paid to or by the direction of the Trustee, any Delegate or any
         Receiver.

14.      THE TRUSTEE ENTITLED TO EXERCISE RECEIVER'S POWERS

         All or any of the powers, authorities and discretions which are
         conferred by this Debenture (either expressly or impliedly) upon any
         Receiver may be exercised after the security hereby created has become
         enforceable by the Trustee in relation to the whole of the Secured
         Assets or any part thereof without first appointing a Receiver of the
         Secured Assets or any part thereof or notwithstanding the appointment
         of a Receiver of the Secured Assets or any part thereof.

15.      POWER OF ATTORNEY

15.1     Each Obligor hereby irrevocably and by way of security appoints the
         Trustee, each Delegate and separately any Receiver severally to be its
         attorney (the "Attorney") in its name and on its behalf and as its act
         and deed or otherwise to:-

         15.1.1   following the occurrence of an Enforcement Event (which is
                  continuing) execute, complete and perfect in favour of the
                  Trustee or its nominees or of any purchaser or any Delegate
                  any documents which the Trustee may require for perfecting its
                  title to or for vesting the Secured Assets in the Trustee or
                  its nominees or in any purchaser or any Delegate;

         15.1.2   execute, complete and perfect all documents and do all such
                  acts and things as may be required for the full exercise of
                  all or any of the powers hereby conferred or which may be
                  deemed expedient by the Trustee, any Delegate or any Receiver
                  on or in connection with any sale, lease, disposition,
                  realisation or getting in by the Trustee or any Receiver of
                  the Secured Assets or any part thereof or in connection with
                  any other exercise of any power hereunder; and

         15.1.3   execute, deliver and perfect all documents and do all things
                  which the Trustee, any Delegate or any Receiver may consider
                  to be required or desirable for:

                  (i)      carrying out any obligation imposed on the Obligors
                           by this Debenture (including the execution and
                           delivery of any notices, deeds, charges, assignments
                           or other security and any transfers of the Secured
                           Assets); and

                  (ii)     enabling the Trustee, each Delegate or any Receiver
                           to exercise, or delegate the exercise of, any of the
                           rights, powers and authorities conferred on them by
                           or pursuant to this Debenture or by law (including,
                           after the occurrence of an Enforcement Event (which
                           is continuing), the exercise of any right of a legal
                           or beneficial owner of the Secured Assets).

                                       14

<PAGE>

         Each Obligor hereby covenants with the Trustee, each Delegate and
         separately with any Receiver that on request it will ratify and confirm
         all security agreements, documents, acts and things and all
         transactions done and entered into by the Trustee, any Delegate or any
         Receiver or by that Obligor at the instance of the Trustee, any
         Delegate or any Receiver in the exercise or purported exercise of its
         or his powers.

15.2     Each of the Trustee and any Receiver shall have full power to delegate
         the power conferred on it or him by this clause 15 but no such
         delegation shall preclude the subsequent exercise of such power by the
         Trustee or the Receiver itself or himself or preclude the Trustee or
         the Receiver from making a subsequent delegation thereof to some other
         person; any such delegation may be revoked by the Trustee or the
         Receiver at any time.

15.3     Each Obligor shall indemnify the Attorney and keep the Attorney
         indemnified against any and all costs, claims and liabilities which the
         Attorney may incur as a result of anything done by the Attorney in the
         proper exercise of any of the powers conferred, or purported to be
         conferred, on him or her by this Debenture unless such cost, claim or
         liability arises as a result of the negligence or wilful misconduct of
         the Attorney.

16.      TRUST OF LEASEHOLD REVERSION(S)

         Each Obligor declares that in respect of all the Mortgaged Property
         which is held under leasehold tenure it shall stand possessed of the
         leasehold reversion(s) immediately expectant on the term hereby granted
         in trust for the Trustee (subject to any equity of redemption
         subsisting therein under this Debenture) and to dispose of as the
         Trustee may direct and hereby authorises the Trustee or any vice
         president, officer, manager or assistant manager for the time being of
         the Trustee to appoint a new trustee or trustees of such reversion in
         its place as if it were incapable of acting in the trusts thereof
         hereby declared and it hereby irrevocably appoints the Trustee, each
         vice president, officer, manager or assistant manager or any one of
         them for the time being of the Trustee its attorney in its name and on
         its behalf to assign the said reversion to the Trustee or the Trustee's
         assigns or as the Trustee or they may direct and to execute and do all
         deeds, documents and acts necessary or proper for that purpose.

17.      CONSOLIDATION

         The restriction on the right of consolidating mortgages contained in
         Section 17 of the Conveyancing Act 1881 shall not apply to this
         Debenture.

18.      CURRENCY CLAUSE

18.1     If any sum (a "SUM") owing by any Obligor under this Debenture or any
         order or judgment given or made in relation to this Debenture has to be
         converted from the currency (the "FIRST CURRENCY") in which such Sum is
         payable into another currency (the "SECOND CURRENCY") for the purpose
         of:

         18.1.1   making or filing a claim or proof against that Obligor;

         18.1.2   obtaining an order or judgment in any court or other tribunal;

         18.1.3   enforcing any order or judgment given or made in relation to
                  this Debenture; or

         18.1.4   applying the Sum in satisfaction of any of the Secured
                  Obligations,

         the Obligors shall indemnify the Trustee from and against any loss
         suffered or incurred as a result of any discrepancy between (a) the
         rate of exchange used for such purpose to convert such Sum from the
         First Currency into the Second Currency and (b) the rate or rates of
         exchange available to the Trustee at the time of such receipt of such
         Sum.

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<PAGE>

19.      SECURITY ADDITIONAL

         The Debenture shall be in addition to and shall not be affected by any
         other Security or guarantee or indemnity which the Trustee or any
         Secured Creditor may at any time hold for any of the Secured
         Obligations. No other Security or guarantee or indemnity now or
         hereafter held by the Trustee or any Secured Creditor over the Secured
         Assets shall merge in the security created by this Debenture.

20.      CONTINUING SECURITY

20.1     The security constituted by this Debenture shall be continuing, shall
         extend to the ultimate balance of the Secured Obligations and shall
         continue in force as a continuing security for the Secured Obligations
         unless and until discharged by the Trustee.

20.2     If the Trustee or any Secured Creditor receives, or is deemed to be
         affected by notice (actual or constructive) of any subsequent Security
         or other interest affecting the Secured Assets or if for any reason any
         guarantee and/or the security constituted hereby ceases to be a
         continuing guarantee or continuing security in respect of any Obligor,
         the Trustee or, as the case may be, such Secured Creditor may open one
         or more new accounts with or continue any existing account(s) with such
         Obligor but in either case the liability of each Obligor in respect of
         the Secured Obligations relating to such Obligor at the date of such
         cessation or at the time when the Trustee or, as the case may be, such
         Secured Creditor received or was deemed to receive notice (as the case
         may be) shall remain regardless of any payments in or out of any such
         account.

21.      WAIVER OF DEFENCES

21.1     The liability of each Obligor hereunder will not be affected by any
         act, omission, circumstance, matter or thing which but for this
         provision would release or prejudice any of its obligations hereunder
         or prejudice or diminish such obligation in whole or in part, including
         without limitation and whether or not known to any other Obligor, the
         Trustee or any Secured Creditor or any other person whatsoever:

         21.1.1   any winding-up, dissolution, examinership, administration or
                  re-organisation of or other change in any Obligor or any other
                  person;

         21.1.2   any of the Secured Obligations being at any time illegal,
                  invalid, unenforceable or ineffective;

         21.1.3   any time or other indulgence being granted to any Obligor or
                  any other person;

         21.1.4   any amendment, variation, waiver or release of any of the
                  Secured Obligations;

         21.1.5   any failure to take or failure to realise the value of any
                  other collateral in respect of the Secured Obligations or any
                  release, discharge, exchange or substitution of any such
                  collateral;

         21.1.6   any other act, event or omission which but for this provision
                  would or might operate to impair, discharge or otherwise
                  affect the obligations of any Obligor hereunder.

21.2     Neither the Trustee nor any Secured Creditor shall be concerned to see
         or investigate the powers or authorities of any of the Obligors or
         their respective officers or agents, and moneys obtained or Secured
         Obligations incurred in purported exercise of such powers or
         authorities or by any person purporting to be an Obligor shall be
         deemed to form a part of the Secured Obligations, and "Secured
         Obligations" shall be construed accordingly.

                                       16

<PAGE>

21.3     For the avoidance of doubt, each Obligor shall be bound by this
         Debenture notwithstanding that any other person (including any other
         Obligor) who was intended to execute or be bound by this Debenture
         and/or any other document required by the terms of the Relevant
         Documents may not do so or may not do so at the same time or may not be
         effectively bound thereby and notwithstanding that this Debenture or
         such document may be released or determined as regards any one or more
         of the other Obligors or be or become invalid, unenforceable or
         otherwise ineffective as against any of the other Obligors whether or
         not such deficiency is known or ought to be known to the Trustee or any
         Secured Creditor or any Obligor or any other person.

22.      NON-COMPETITION

         [Intentionally left blank]

23.      SECURITY HELD BY OBLIGOR

         [Intentionally left blank]

24.      CONVERSION OF FLOATING CHARGE

24.1     By notice in writing to the Obligors the Trustee may and shall, if so
         instructed pursuant to the Security Trust and Intercreditor Deed,
         convert the floating charge created by clause 3.3 with immediate effect
         into a fixed charge as regards any property or assets specified in the
         notice if:

         (a)      an Event of Default has occurred and is continuing; or

         (b)      any person attempts to levy any distress, execution, diligence
                  or other similar process against or to appoint a Receiver over
                  any of the Secured Assets; or

         (c)      the Trustee reasonably considers that any of the Secured
                  Assets may be in jeopardy or in danger of being seized or sold
                  pursuant to any form of legal process, other than a voluntary
                  sale of Secured Assets entered into by the relevant Obligor
                  and permitted by the Indentures PROVIDED THAT the Trustee
                  shall not be under any duty to monitor the Secured Assets.

24.2     Notwithstanding clause 24.1 and without prejudice to any law which may
         have a similar effect, the floating charge created hereunder will
         automatically be converted (without notice) with immediate effect into
         a fixed charge as regards all the assets subject to the floating charge
         if any person levies or attempts to levy any distress, execution,
         diligence or other similar process against, or appoints a Receiver
         over, any of the Secured Assets or a resolution is passed or an order
         is made for the winding-up, dissolution, administration, examination or
         re-organisation of an Obligor or an administrator or examiner is
         appointed to an Obligor other than in connection with a solvent
         reconstruction of any Obligor permitted under the Indentures.

24.3     Where an asset has become subject to a fixed charge under clause 24.1
         or clause 24.2 the Trustee shall, if so requested by the Obligor who
         owns such asset and if instructed to do so in accordance with the
         Security Trust and Intercreditor Deed, release the asset from that
         fixed charge by notice in writing to such Obligor.

24.4     When an asset is released from the fixed charge under clause 24.3
         above, the asset will again be subject to:

         (a)      the floating charge under clause 3.3; and

         (b)      the further operation of clause 24.1 or clause 24.2.

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25.      SET-OFF

         Each Obligor authorises the Trustee (but the Trustee shall not be
         obliged to exercise such right), after the occurrence of an Enforcement
         Event which is continuing, to set off against the Secured Obligations
         any amount or other obligation (contingent or otherwise) owing by the
         Trustee to that Obligor.

26.      EXPENSES, COSTS AND TAXES

26.1     EXPENSES

         Each Obligor shall, from time to time and promptly on demand by the
         Trustee, reimburse the Trustee in respect of all costs and expenses
         (including legal fees) incurred in relation to such Obligor on a full
         indemnity basis together with any applicable VAT incurred by the
         Trustee and any Delegate (PROVIDED THAT in relation to sub-clause
         26.1.1 of this Clause 26.1, such costs and expenses must be properly
         incurred) in connection with:

         26.1.1   the execution, release and discharge of this Debenture and the
                  Security created or intended to be created in respect of the
                  Secured Assets and the perfection of the Security contemplated
                  in this Debenture or in any such documents or forming part of
                  the Security created or intended to be created in respect of
                  the Secured Assets;

         26.1.2   the actual or contemplated exercise, preservation and/or
                  enforcement of any of the rights, powers and remedies of, or
                  the performance of the duties and obligations of, the Trustee
                  or any Delegate, or any amendment or waiver in respect of this
                  Debenture;

         26.1.3   the preservation and/or enforcement of the Security created or
                  intended to be created in respect of the Secured Assets; and

         26.1.4   the foreclosure of any Secured Assets,

         which shall carry interest from the date of such demand until so
         reimbursed at the rate and on the basis as mentioned in clause 2.3.

         In the event that such costs and expenses cannot be attributed to a
         specific Obligor, then such costs and expenses shall be borne pro-rata
         by each Obligor.

26.2     TAXES

         Each Obligor shall pay promptly on demand of the Trustee all stamp,
         registration, notarial and other similar Taxes or fees paid or payable
         by the Trustee in connection with any action taken or contemplated by
         or on behalf of the Trustee for perfecting, enforcing, releasing,
         cancelling, reassigning or resolving any doubt concerning, or for any
         other purpose in relation to this Debenture, any amendment thereto, any
         transfer and/or assignment of the rights and/or obligations under the
         same or the Security created or intended to be created in respect of
         the Secured Assets and shall, from time to time, indemnify the Trustee
         promptly on demand against any liabilities, costs, claims and expenses
         resulting from any failure to pay by any Obligor or any delay by any
         Obligors in paying any such Taxes or fees.

                                       18

<PAGE>

27.      FURTHER ASSURANCE

27.1     FURTHER ASSURANCE: GENERAL

         Each Obligor shall promptly do all such acts or execute all such
         documents (including assignments, transfers, mortgages, charges,
         notices and instructions) as the Trustee may specify (and in such form
         as the Trustee may require in favour of the Security or its
         nominee(s)):

         27.1.1   to perfect the Security created or intended to be created in
                  respect of the Secured Assets (which may include the execution
                  by that Obligor of a mortgage, charge or assignment over all
                  or any of the assets constituting, or intended to constitute,
                  Secured Assets) or for the exercise of the Collateral Rights;

         27.1.2   to confer on the Trustee Security over any property and assets
                  of that Obligor located in any jurisdiction outside Ireland
                  equivalent or similar to the Security intended to be conferred
                  by or pursuant to this Debenture;

         27.1.3   to confer on the Trustee Security and to create, perfect,
                  protect or maintain Security (which in so far as it relates to
                  Real Property in Ireland shall be a charge by way of legal
                  mortgage) over all its right, title and interest from time to
                  time in any Real Property (including using all reasonable
                  endeavours to obtain any requisite third party consent);
                  and/or

         27.1.4   to facilitate the realisation of the Secured Assets.

27.2     NECESSARY ACTION

         If so requested by the Trustee each Obligor shall take all such action
         as is reasonably available to it (including making all filings and
         registrations) as may be reasonably necessary for the purpose of the
         creation, perfection, protection or maintenance of any Security
         conferred or intended to be conferred on the Trustee by or pursuant to
         this Debenture.

28.      SEVERABILITY

         Each of the provisions of this Debenture is severable and distinct from
         the others and if at any time, any such provision is or becomes
         invalid, illegal or unenforceable in any jurisdiction that shall not
         affect the validity, legality and enforceability of the remaining
         provisions hereof or affect the validity, legality or enforceability of
         such provision in any other jurisdiction. Without prejudice to the
         foregoing, if at any time any liability in relation to the Secured
         Obligations is or becomes invalid, illegal or unenforceable then, such
         occurrence shall not prejudice the continuing effectiveness of any
         guarantee or security created by or pursuant to this Debenture for any
         liability in relation to the Secured Obligations which is not so
         affected.

29.      REMEDIES, WAIVERS, CONSENTS AND AMENDMENTS

29.1     The rights, powers and remedies provided in this Debenture are
         cumulative and not, nor are they to be construed as, exclusive of any
         rights, powers or remedies provided by law or otherwise.

29.2     No failure or delay by the Trustee or any Secured Creditor in
         exercising any right or remedy shall operate as a waiver thereof nor
         shall any single or any partial exercise or waiver of any right or
         remedy preclude its further exercise or the exercise of any other right
         or remedy.

29.3     Any provision of this Debenture may be amended, supplemented or novated
         only if the Obligors and the Trustee so agree in writing. Any waiver
         of, and any consent or approval by the Trustee under, any provision of
         this Debenture shall not be effective unless it is in writing, and may
         be

                                       19

<PAGE>

         given subject to any conditions thought fit by the Trustee, may be
         withdrawn or modified at any time and shall be effective only in the
         instance and for the purpose for which is it given.

29.4     Each Obligor waives any right it may have of first requiring the
         Trustee to proceed against or enforce any other rights or security or
         claim payment from any other person before enforcing the security
         constituted hereby.

29.5     Neither the Trustee nor any Secured Creditor nor any Delegate nor any
         Receiver shall be under any liability for any loss of any kind
         (including without limitation, any loss arising from changes in
         exchange rates or diminution in the value of any of the Secured Assets)
         which may be occasioned by the exercise or purported exercise of, or
         any delay or neglect to exercise, any of its rights under this
         Debenture except in the case of negligence or wilful default on its
         part.

30.      THE TRUSTEE'S DISCRETION

         Any liberty or power which may be exercised or any determination which
         may be made hereunder by the Trustee may be exercised or made in the
         absolute and unfettered discretion of the Trustee which shall not be
         under any obligation to give reasons therefor.

31.      NOTICES

31.1     Each communication to be made under this Debenture shall be made and
         delivered in accordance with the provisions of the Security Trust and
         Intercreditor Deed.

32.      ASSIGNMENT

32.1     This Debenture shall be binding upon and inure to the benefit of each
         party hereto and its successors and permitted assigns.

32.2     The Trustee and each Secured Creditor may assign or transfer all or any
         of its rights or obligations hereunder in accordance with the Security
         Trust and Intercreditor Deed. The Trustee and each Secured Creditor
         shall be entitled to impart any information concerning any Obligor and
         this Debenture as the Trustee considers appropriate to any such
         assignee, transferee or other successor or any participant or proposed
         assignee, transferee, successor or participant.

33.      PERPETUITY PERIOD

         The perpetuity period under the rule against perpetuities, if
         applicable to this Debenture, shall be the period of eighty years from
         the date of the Security Trust and Intercreditor Deed.

34.      COUNTERPART CLAUSE

         This Debenture may be executed in counterparts and by the parties on
         separate counterparts each of which when executed and delivered shall
         together constitute one and the same instrument.

35.      LAW AND JURISDICTION

35.1     This Debenture shall be governed by and construed in accordance with
         the laws of Ireland.

35.2     It is irrevocably agreed for the exclusive benefit of the Trustee and
         the Secured Creditors that the courts of Ireland are to have
         jurisdiction to settle any disputes which may arise out of or in
         connection with this Debenture and that accordingly any suit, action or
         proceeding arising out of or in connection with this Debenture (in this
         clause referred to as "Proceedings") may be brought in such courts.
         Nothing in this clause shall limit the right of the Trustee or any
         Secured Creditor to take Proceedings against any Obligor in any other
         court of competent jurisdiction, nor shall the

                                       20

<PAGE>

         taking of Proceedings in one or more jurisdictions preclude the taking
         of Proceedings in any other jurisdiction, whether concurrently or not.

36.      LAND ACT CERTIFICATE

         The Trustee hereby certifies that it is a qualified person for the
         purposes of Section 45 of the Land Act, 1965.

IN WITNESS whereof this Debenture has been duly executed on the date first
written above.

                                       21

<PAGE>

                                   SCHEDULE 1

                                  THE OBLIGORS

<TABLE>
<CAPTION>
                                                                       COUNTRY
           NAME                           REGISTERED OFFICE        OF INCORPORATION      REGISTERED NUMBER
<S>                                   <C>                          <C>                   <C>
Marconi Communications Limited        Arthur Cox Building,            Ireland                 298722
                                      Earlsfort Terrace
                                      Dublin 2

Marconi Communications                Block 1                         Ireland                 154999
Optical Networks                      West Pier Business
Limited                               Campus
                                      Old Dunleary Road
                                      Dun Laoghaire
                                      Co. Dublin
</TABLE>

                                       22

<PAGE>

                                   SCHEDULE 2

                             THE SCHEDULED PROPERTY

ALL THAT AND THOSE the premises known as Block No. 1, West Pier Business Campus,
Dun Laoghaire, situate in the County of Dublin HELD under a Lease dated the 7th
day of February 2002 and made between Joseph Cosgrave, Peter Cosgrave and
Michael Cosgrave of the First Part, Marconi Communications Optical Networks
Limited of the Second Part, West Pier Business Campus (Management) Limited of
the Third Part and Marconi Communications Inc. of the Fourth Part, for a term of
25 years from 13 April 2000 subject to the initial yearly rent thereby reserved
and the covenants and conditions therein contained.

                                       23

<PAGE>

                                   SCHEDULE 3

                          FORM OF NOTICE OF ASSIGNMENT

To: [relevant Contract counterparty]

Dear Sirs

We hereby give you notice that, by a first priority debenture dated [-] (the
"DEBENTURE") made by [-] (the "Obligor") and certain other parties in favour of
us (the "TRUSTEE") as security trustee for ourselves and the other Secured
Creditors (as therein defined) the Obligor assigned to us all its rights, title
and interest in and to [insert details of relevant Contract] (the "CONTRACT")
including all monies payable thereunder.

With effect from your receipt of this notice:

1.       all payments by you to the Obligor under or arising from the Contract
         should be made to us or to our order as we may specify in writing from
         time to time [details of the account into which sums are to be paid may
         be included];

2.       all remedies provided for in the Contract or available at law or in
         equity are exercisable by us;

3.       all rights to compel performance of the Contract are exercisable by us
         although the Obligor shall remain liable to perform all the obligations
         assumed by it under the Contract;

4.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of the Obligor arising from the Contract belong to us and no
         changes may be made to the terms of the Contract nor may the Contract
         be terminated without our consent; and

5.       you are authorised and instructed, without requiring further approval
         from the Obligor, to provide us with such information relating to the
         Contract as we may from time to time request and to send us copies of
         all notices issued by you under the Contract to us as well as to the
         Obligor.

These instructions may not be revoked, nor may the terms of the Contract be
amended, varied or waived without our prior written consent.

We confirm that pursuant to clause 6.2 and clause 15 of the Debenture, we are
empowered and authorised to deliver this Notice of Assignment for and on behalf
of the Obligor.

This letter is governed by Irish law.

Please acknowledge receipt of this notice by signing the acknowledgement on the
enclosed copy letter and returning it to us at Fifth Floor, 100 Wood Street,
London EC2V 7EX marked for the attention of Manager, Trust Administration.

Yours faithfully

___________________________________________
FOR AND ON BEHALF OF
THE LAW DEBENTURE TRUST CORPORATION p.l.c.
as attorney for and on behalf of [         ]

                                       24

<PAGE>

                     FORM OF ACKNOWLEDGEMENT TO THE TRUSTEE

To: The Law Debenture Trust Corporation p.l.c.
    Fifth Floor
    100 Wood Street
    London EC2V 7EX
    England

                                                                          [Date]

Dear Sirs

We acknowledge receipt of a notice in the terms set out above and confirm that
we have not received notice of any previous assignments or charges of or over
any of the rights, interests and benefits in and to the Contract and that we
will comply with the terms of that notice.

We further confirm that:

(a)      no amendment, waiver or release of any of such rights, interests and
         benefits shall be effective without your prior written consent;

(b)      no termination of such rights, interests or benefits shall be effective
         unless we have given you thirty days written notice of the proposed
         termination, specifying the action necessary to avoid such termination;
         and

(c)      no breach or default on the part of the Obligor of any of the terms of
         the Contract shall be deemed to have occurred unless we have given you
         notice of such breach specifying how to make good such breach.

This letter shall be governed by and construed in accordance with the laws of
Ireland.

Yours faithfully

______________________________________________
On behalf of [relevant Contract counterparty]

                                       25

<PAGE>

                                   SCHEDULE 4

                                     PART A

                      FORM OF NOTICE OF CHARGE TO LANDLORDS

To: [Landlord]

Date: [       ]

Dear Sirs,

We give you notice that, by a Debenture dated [ ] (the "DEBENTURE") we charged
to The Law Debenture Trust Corporation p.l.c. (the "TRUSTEE") as security
trustee for the Secured Creditors referred to in the Debenture all our right,
interests and benefits in, to and under the [describe Lease] dated [     ]
between [             ] relating to [             ] (including all monies
payable thereunder and the proceeds of all claims and judgments for breach of
covenant) (the "LEASE").

We will remain liable to perform all our obligations under the Lease and the
Trustee is under no obligation of any kind whatsoever under the Lease nor under
any liability whatsoever in the event of any failure by us to perform our
obligations under the Lease.

Please note that:

1.       all remedies provided for under the Lease or available at law or in
         equity are exercisable by the Trustee;

2.       all rights to compel performance of the Lease are exercisable by the
         Trustee; and

3.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of ourselves arising under the Lease belong to the Trustee.

This letter is governed by and will be construed in accordance with the laws of
Ireland. Would you acknowledge receipt of this notice by sending the enclosed
acknowledgement to the Trustee with a copy to ourselves.

Yours faithfully

[              ]

                                       26

<PAGE>

                            ACKNOWLEDGEMENT OF CHARGE

To: The Law Debenture Trust Corporation p.l.c.
    as Trustee

Date: [       ]

Dear Sirs

We confirm receipt from [Chargor] (the "OBLIGOR") of a notice dated [    ] of a
charge upon the terms of a Debenture dated [    ] (the "DEBENTURE") to The Law
Debenture Trust Corporation p.l.c. (the "TRUSTEE") as Trustee for the Secured
Creditors of all the Obligor's right, interest and benefit in, to and under the
Lease (as specified in that notice) to which we are a party.

We confirm that we have not received notice of any assignment or charge of or
over any of the rights, interests and benefits specified in such notice.

We further confirm that:

1.       no amendment, waiver or release of any such rights, interests and
         benefits will be effective without the prior written consent of the
         Trustee;

2.       no termination of such rights, interests or benefits will be effective
         unless we have given the Trustee at least 21 days' written notice of
         the proposed termination and specifying the action necessary to avoid
         such termination;

3.       the Obligor will remain liable to perform all its obligations under the
         Lease and the Trustee is under no obligation of any kind whatsoever
         under the Lease nor under any liability whatsoever in the event of any
         failure by the Obligor to perform our obligations under the Lease; and

4.       no breach or default on the part of the Obligor of any of the terms of
         such Lease will be deemed to have occurred unless we have given notice
         of such breach to the Trustee specifying how to make good such breach.

We unconditionally and irrevocably waive all rights of set-off, lien,
combination of accounts and similar rights (however described) which we may have
now or in the future to the extent that such rights relate to amounts owed to us
by the Obligor (and the proceeds thereof) and we will send you copies of all
statements, orders and notices given by us relating to such debt.

This letter is governed by and will be construed in accordance with the laws of
Ireland.

Yours faithfully

[Landlord]

                                       27

<PAGE>

                                     PART B

                      FORM OF NOTICE OF CHARGE OVER ACCOUNT

To:  [Account Bank]

Dear Sirs,

We hereby give you notice, as attorney for and on behalf of the Obligor, that
the Obligor has, pursuant to a debenture dated [    ] (the "DEBENTURE"), charged
to us as Trustee for and on behalf of the Secured Creditors referred to therein,
all their rights, title and interest in and to all sums of money which may now
or in the future be held by the Obligor with you in any accounts at any of your
branches (the "ACCOUNTS"), together with all interest from time to time earned
thereon and the debts represented by such sums and interest, as well as all book
and other debts owed to the Obligor.

We hereby irrevocably authorise and instruct you:

(a)      to disclose to us without any reference to or further authority from
         the Obligor and without any enquiry by you as to the justification of
         such disclosure, such information relating to the Accounts and the sums
         therein as we may at any time and from time to time request;

(b)      to hold all sums from time to time standing to the credit of the
         Accounts to our order;

(c)      to pay or release all or any part of the sums from time to time
         standing to the credit of the Accounts in accordance with our written
         instructions at any time or times;

(d)      to comply with the terms of any written notice or instructions in any
         way relating to, or purporting to relate to, the Debenture, the sums
         standing to the credit of the Accounts from time to time or the debts
         represented thereby which you receive at any time from us without any
         reference to or further authority from the Obligor and without any
         enquiry by you as to the justification for or validity of such notice
         or instruction; and

(e)      to pay all monies received by you for the Accounts to (and only to) the
         credit of those Accounts.

Please note that the Obligor is not permitted to withdraw any amount from any of
the Accounts without our prior written consent.

Please also note that these instructions are not to be revoked or varied without
our prior written consent.

We confirm that pursuant to clause 6.1 and clause 15 of the Debenture, we are
empowered and authorised to deliver this Notice of Charge for and on behalf of
the Obligor.

This letter is governed by Irish law.

Please acknowledge receipt of this notice by sending the attached
acknowledgement to us with a copy to the Obligor.

Yours faithfully,

_____________________________________________
by The Law Debenture Trust Corporation p.l.c.
as attorney for and on behalf of [        ]

                                       28

<PAGE>

                             FORM OF ACKNOWLEDGEMENT

To: The Law Debenture Trust Corporation p.l.c.

Dear Sirs,

We confirm receipt from The Law Debenture Trust Corporation p.l.c. as attorney
for and on behalf of [    ] (the "OBLIGOR") of a notice dated [    ] relating to
certain accounts (the "ACCOUNTS") of the Obligor with the Bank.

We confirm that:

(i)      we accept the instructions and authorisations contained in that notice
         and we undertake to act in accordance with the terms of that notice;

(ii)     we have not received notice of the interest of any third party in the
         Accounts;

(iii)    we have neither claimed or exercised nor will claim or exercise any
         security interest, set-off, counter-claim or other rights in respect of
         the Accounts, the sums therein or the debts represented thereby without
         your prior written consent;

(iv)     we shall pay all monies received by us for the account of the Obligor
         to (and only to) the credit of the Account(s) in the name of the
         Obligor unless otherwise consented to by you; and

(v)      we shall not permit any amount to be withdrawn from any of the Accounts
         without your prior written consent.

Nothing contained in any of our arrangements with you shall commit us to
providing any facilities or making advances available to the Obligor.

This letter is governed by Irish law.

Yours faithfully,

_______________________________________
On behalf of [Bank]

                                       29

<PAGE>

                                     PART C

                  FORM OF NOTICE OF CHARGE OVER MONETARY CLAIMS

To: [                 ]
                                                              Date: [          ]

Dear Sirs,

DEBENTURE DATED [      ] BY [      ] (THE "OBLIGOR") AND OTHERS AND THE LAW
DEBENTURE TRUST CORPORATION P.L.C. (THE "TRUSTEE") (THE "DEBENTURE")

We hereby give you notice, as attorney for and on behalf of the Obligor, that
the Obligor has, pursuant to the Debenture, charged to us as Trustee for and on
behalf of the Secured Creditors referred to therein all their right, title and
interest in and to [details of Monetary Claim] (the "MONETARY CLAIM") including
all moneys which may be payable in respect of the Claim.

With effect from your receipt of this notice:

1.       all payments by you to the Obligor under or arising from the Monetary
         Claim should be made to us or to our order as we may specify in writing
         from time to time [details of the account into which sums are to be
         paid may be included];

2.       all remedies available at law or in equity in relation to the Monetary
         Claim are exercisable by us;

3.       all rights to compel performance of the underlying contract in respect
         of the Monetary Claim (the "UNDERLYING CONTRACT") between you and the
         Obligor are exercisable by us although the Obligor shall remain liable
         to perform all the obligations assumed by it thereunder;

4.       all rights, interests and benefits whatsoever accruing to or for the
         benefit of the Obligor arising from the Monetary Claim belong to us and
         no changes may be made to the terms of the Underlying Contract nor may
         the Underlying Contract be terminated without our consent; and

5.       you are authorised and instructed, without requiring further approval
         from the Obligor, to provide us with such information relating to the
         Monetary Claim as we may from time to time request and to send us
         copies of all notices issued by you under the Underlying Contract to us
         as well as to the Obligor.

These instructions may not be revoked, nor amended, varied or waived without our
prior written consent.

We confirm that pursuant to clause 6.1 and clause 15 of the Debenture, we are
empowered and authorised to deliver this Notice of Charge for and on behalf of
the Obligor.

This letter is governed by Irish law.

Please acknowledge receipt of this notice by signing the acknowledgement on the
enclosed copy letter and returning it to us at Fifth Floor, 100 Wood Street,
London EC2V 7EX marked for the attention of Manager, Trust Administration.

Yours faithfully,

___________________________________
for and on behalf of
THE LAW DEBENTURE TRUST CORPORATION p.l.c.
as attorney for and on behalf of [       ]

                                       30

<PAGE>

[On copy only:

To:      THE LAW DEBENTURE TRUST CORPORATION p.l.c. AS TRUSTEE

We acknowledge receipt of a notice in the terms set out above and confirm that
we have not received notice of any previous charges of or over any of the
rights, interests and benefits in and to the Monetary Claim and that we will
comply with the terms of that notice.

We further confirm that:

(a)      no amendment, waiver or release of any of such rights, interests and
         benefits shall be effective without your prior written consent;

(b)      no termination of such rights, interests or benefits shall be effective
         unless we have given you thirty days written notice of the proposed
         termination, specifying the action necessary to avoid such termination.

For and on behalf of [          ]
By:__________________________
Dated:

                                       31

<PAGE>

SIGNED SEALED AND DELIVERED                          CARLA MORAN
by the duly authorised attorney of
of MARCONI COMMUNICATIONS LIMITED
in the presence of:-

Witness Signature:            H MARREN

Witness name:                 HILARY MARREN

Witness Address:              2 Harbourmaster Place, IFSC, Dublin 1

SIGNED SEALED AND DELIVERED                          CARLA MORAN
by the duly authorised attorney of
of MARCONI COMMUNICATIONS OPTICAL NETWORKS LIMITED
in the presence of:-

Witness Signature:            H MARREN

Witness name:                 HILARY MARREN

Witness Address:              2 Harbourmaster Place, IFSC, Dublin 1

EXECUTED AS A DEED
on behalf of THE TRUSTEE by:-                        J. M. JEBB
                                                     Director

                                                     R. D. RANCE
                                                     Director

                                       32

<PAGE>

                                DATED 19 MAY 2003

                    (1) THE COMPANIES SPECIFIED IN SCHEDULE 1

                           (2) THE LAW DEBENTURE TRUST
                               CORPORATION p.l.c.
                                  (AS TRUSTEE)

         --------------------------------------------------------------
                               MORTGAGE DEBENTURE
                               (VARIOUS CHARGORS)
         --------------------------------------------------------------

                            MATHESON ORMSBY PRENTICE
                                30 Herbert Street
                                    Dublin 2
                                     Ireland

                              TEL + 353 1 619 9000
                              FAX + 353 1 619 9010

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