Global Crossing - Quarterly Report

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act.). Yes x No ¨

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by sections 12,13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes x No ¨

The number of shares of the Registrant’s common stock, par value $0.01 per share, outstanding as of May 1, 2005 was 22,530,267.


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PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements	1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	23

Item 4.	Controls and Procedures	23

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	25

Item 4.	Submission of Matters to a Vote of Security Holders	25

Item 6.	Exhibits	25


	March 31, 2005			December 31, 2004
	(unaudited)
ASSETS:
Current assets:
Cash and cash equivalents	$	277		$	365
Restricted cash and cash equivalents		7			4
Accounts receivable, net of allowances of $78 and $88		286			298
Other current assets and prepaid costs		97			98

Total current assets		667			765

Property and equipment, net		1,032			1,065
Intangible assets, net		2			14
Other assets		94			87

Total assets	$	1,795		$	1,931

LIABILITIES:
Current liabilities:
Accounts payable	$	115		$	136
Accrued cost of access		171			194
Accrued restructuring costs - current portion		36			44
Deferred revenue - current portion		82			81
Other current liabilities		366			367

Total current liabilities		770			822

Debt with controlling shareholder		250			250
Long term debt		392			396
Obligations under capital leases		85			90
Deferred revenue		129			135
Accrued restructuring costs		119			106
Other deferred liabilities		80			81

Total liabilities		1,825			1,880

SHAREHOLDERS’ EQUITY (DEFICIT):
Common stock, 55,000,000 shares authorized, $.01 par value, 22,493,593 and 22,053,690 shares issued and outstanding as of March 31, 2005 and December 31, 2004, respectively.		—			—
Preferred stock with controlling shareholder, 45,000,000 shares authorized, $.10 par value, 18,000,000 shares issued and outstanding		2			2
Additional paid-in capital		443			431
Accumulated other comprehensive loss		(22	)		(35	)
Accumulated deficit		(453	)		(347	)

Total shareholders’ equity (deficit)		(30	)		51

Total liabilities and shareholders’ equity (deficit)	$	1,795		$	1,931

The accompanying notes are an integral part of these condensed consolidated financial statements.

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	Three Months Ended March 31,
	2005			2004
Revenue	$	526		$	666
Operating expenses:
Cost of access		(320	)		(479	)
Third party maintenance		(26	)		(31	)
Operating expenses		(208	)		(193	)
Depreciation and amortization		(37	)		(43	)

Total operating expenses		(591	)		(746	)

Operating loss		(65	)		(80	)

Other income (expense):
Interest expense, net		(21	)		(5	)
Other income (expense), net		(13	)		4

Loss from continuing operations before reorganization items		(99	)		(81	)
Net gain on preconfirmation contingencies		2			—

Loss from continuing operations before income taxes		(97	)		(81	)
Provision for income taxes		(9	)		(14	)

Loss from continuing operations		(106	)		(95	)
Loss from discontinued operations, net of income tax		—			(13	)

Net loss		(106	)		(108	)
Preferred stock dividends		(1	)		(1	)

Loss applicable to common shareholders	$	(107	)	$	(109	)

Loss per common share, basic and diluted:
Loss from continuing operations applicable to common shareholders	$	(4.82	)	$	(4.36	)
Loss from discontinued operations, net		—			(0.59	)

Loss applicable to common shareholders	$	(4.82	)	$	(4.95	)

Shares used in computing loss per common share		22,218,596			22,000,000

The accompanying notes are an integral part of these condensed consolidated financial statements.

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	Three Months Ended March 31,
	2005			2004
Cash flows provided by (used in) operating activities:
Net loss	$	(106	)	$	(108	)
Adjustments to reconcile net loss to net cash used in operating activities:
Loss from discontinued operations		—			13
Loss on sale of property and equipment		3			—
Non-cash income tax provision		8			11
Non-cash stock compensation expense		13			5
Depreciation and amortization		37			43
Provision for doubtful accounts		—			1
Amortization of prior period IRUs		(1	)		(1	)
Deferred reorganization costs		(6	)		(31	)
Gain on preconfirmation contingencies		(2	)		—
Other		17			(1	)
Changes in operating assets and liabilities		(17	)		31

Net cash used in operating activities from continuing operations		(54	)		(37	)
Net cash used in discontinued operations		—			(2	)

Net cash used in operating activities		(54	)		(39	)

Cash used in investing activities:
Purchases of property and equipment		(24	)		(29	)
Proceeds from sale of equity interest in holding companies		—			4
Change in restricted cash and cash equivalents		(5	)		—

Net cash used in investing activities		(29	)		(25	)

Cash flows used in financing activities:
Repayment of capital leases		(3	)		(3	)
Proceeds from exercise of stock options		1			—
Other		(1	)		—

Net cash used in financing activities		(3	)		(3	)

Effect of exchange rate changes on cash and cash equivalents		(2	)		2

Net decrease in cash and cash equivalents		(88	)		(65	)
Cash and cash equivalents, beginning of period		365			216

Cash and cash equivalents, end of period	$	277		$	151

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Global Crossing Limited and its subsidiaries (collectively, the “Company”) provide telecommunication services using a global Internet Protocol (“IP”) based network that directly connects more than 300 cities in over 30 countries and delivers services to more than 500 major cities in over 50 countries around the world. All references to the “Company” include the operating subsidiaries through which the services described herein are directly provided. The Company serves many of the world’s largest corporations, providing a full range of managed data and voice products and services, and its mission is to attain leadership in global data and IP services by building on its extensive global network and IP service platform.

2. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report for the year ended December 31, 2004 filed with the SEC on Form 10-K, as amended by the Company’s subsequent Form 10-K/A filing. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments considered necessary for a fair presentation of interim results for the Company. The results of operations for any interim period are not necessarily indicative of results to be expected for the full year.

The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Although these estimates are based on management’s knowledge of current events, actual amounts and results could differ from those estimates. The estimates made are based on historical factors, current circumstances, and the experience and judgment of the Company’s management. The Company continually evaluates the judgments, estimates and assumptions and may employ outside experts to assist in its evaluations.

Reclassifications

Certain prior year amounts have been reclassified in the accompanying unaudited condensed consolidated financial statements for consistent presentation to the current period.

3. RESTRUCTURING ACTIVITIES

2004 Restructuring Plans

In light of ongoing adverse conditions in the telecommunications industry, particularly the continued pricing pressures for telecommunications services, the Company’s Board of Directors approved a restructuring plan on October 8, 2004 (the “October 2004 Restructuring Plan”) designed to focus on businesses that are consistent with the Company’s overall mission. The plan involves concentrating the Company’s efforts in areas that the Company anticipates will provide profitable growth opportunities and exit strategies for moving away from a number of unprofitable and non-strategic parts of the business. The plan includes initiatives to increase the Company’s focus on its core enterprise, collaboration, and carrier data sales business as well as to pursue several new business development initiatives in areas where the Company can capitalize on its IP network and capabilities. These initiatives are focused principally on global IP offerings and on expanding the Company’s distribution capabilities through indirect channels such as system integrators as well as providing enhanced services for telecommunications carriers to resell. The Company plans to redeploy certain personnel and

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reorganize its sales and marketing efforts around these initiatives. The plan also includes downsizing the Company’s carrier voice business, primarily in North America, through pricing actions designed to maintain targeted gross margins for this service. The plan also includes the divestiture or other exiting of the Company’s operations in consumer, small business, trader voice, and calling card services. Finally the plan calls for implementing workforce reductions, facilities consolidation and other cost savings initiatives associated with the parts of the business being deemphasized noted above.

As a result of these efforts, the Company estimates that it will incur cash restructuring charges of approximately $13 for severance and related benefits in connection with the anticipated workforce reductions and an additional $2 for real estate consolidation. Through March 31, 2005 the Company has incurred $11 and $1 of restructuring charges related to severance and related benefits and facility closings, respectively. The Company began implementation of the October 2004 Restructuring Plan during the fourth quarter of 2004 and it is anticipated that payment of the restructuring activities related to employee terminations will be completed during 2005 and real estate consolidations will continue through 2008. The Company believes that the results of the initiatives undertaken with respect to the October 2004 Restructuring Plan will, over time, reduce the Company’s funding requirements, accelerate the date by which its operating cash flow will be sufficient to satisfy its anticipated liquidity requirements, and lead to overall profitability for the Company.

Restructuring charges are included in other operating expenses in the condensed consolidated statement of operations.

The table below reflects the activity associated with the restructuring reserve relating to the October 2004 Restructuring Plan for the three months ended March 31, 2005:


	Employee Separations			Facility Closings		Total
Balance at December 31, 2004	$	6		$	1	$	7
Deductions		(3	)		—		(3	)

Balance at March 31, 2005	$	3		$	1	$	4

2003 and Prior Restructuring Plans

Prior to the Company’s emergence from bankruptcy on December 9, 2003, the Company adopted certain restructuring plans as a result of the slow down of the economy and telecommunications industry, as well as its efforts to restructure while under Chapter 11 bankruptcy protection. The restructuring activities included the integration of certain global functions to more appropriately align those functional units with regional operating needs, and the elimination of certain positions within existing functions. The Company also integrated responsibilities within network operations, service delivery, and other functions. As a result of these activities, the Company eliminated approximately 5,200 positions and vacated over 250 facilities. All amounts incurred for employee separations have been paid and it is anticipated that the remainder of the restructuring liability related to facility closings for these plans will be paid through 2025.

During the three months ended March 31, 2005, the Company increased its restructuring reserves for facility closings by $24. This reserve is composed of continuing building lease obligations and estimated decommissioning costs and broker commissions for the restructured sites (aggregating $425 as of March 31, 2005), offset by anticipated receipts from existing and future third-party subleases. As of March 31, 2005, anticipated third-party sublease receipts were $274, representing $79 from subleases already entered into and

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$195 from subleases projected to be entered into in the future. The Company continues to review the anticipated costs and third-party sublease payments on a quarterly basis and records adjustments for changes in these estimates in the period such changes become known. During the three months ended March 31, 2005, the Company reduced its estimated third-party sublease payments due to a decline in the sublet demand for space in the applicable locales, principally in Europe.

The table below reflects the activity associated with the restructuring reserve relating to the restructuring plans initiated during 2003 and prior for the three months ended March 31, 2005:


	Facility Closings
Balance at December 31, 2004	$	143
Change in estimated liability		24
Deductions		(10	)
Foreign currency impact		(6	)

Balance at March 31, 2005	$	151

4. STOCK BASED COMPENSATION

The Company recognized $13 and $5 of non-cash stock related expenses for the three months ended March 31, 2005 and 2004, respectively. During the three months ended March 31, 2005, the Company awarded 88,326 stock options to its employees. The stock options are exercisable over a ten-year period, vest over a three-year period and have an exercise price range of $16.26 to $20.50 per share.

The Company also maintains a Senior Leadership Performance Program (the “Program”) which is intended to retain key executives and motivate them to help the Company achieve its financial goals. The Program creates for each participant an aggregate potential award under the Program in an amount equal to the participant’s regular annual cash bonus target opportunity. The awards will be granted if the Company achieves specific performance goals related to earnings and /or cash flow by December 31, 2006. Any bonus is payable 50% in cash and 50% in shares of the Company’s common stock. During the first quarter of 2005 two additional employees joined the Program. If the performance goals are met, 16,163 shares would be awarded, in total, to these two new participants.

On March 18, 2005, the Board of Directors of the Company adopted the 2005 Annual Bonus Program (the “2005 Bonus Program”). The 2005 Bonus Program is an annual bonus applicable to substantially all employees of the Company, which is intended to retain such employees and to motivate them to help the Company achieve its financial goals. Each participant is provided a target award under the 2005 Bonus Program expressed as a percentage of base salary. Actual awards under the 2005 Bonus Program will be paid only if the Company achieves specified earnings and cash flow goals. Bonus payouts under the 2005 Bonus Program will be made half in cash and, subject to shareholder approval of a sufficient increase in the shares available under the 2003 Global Crossing Limited Stock Incentive Plan, half in fully vested shares of common stock of the Company; provided that the Compensation Committee of the Board of Directors retains discretion to use cash rather than shares as the Committee deems fit. To the extent common shares are used for payment of bonus awards, such shares shall be valued based on the closing price on the NASDAQ National Market on the date financial results are certified by the Compensation Committee.

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Basic loss per common share is computed as net loss applicable to common stockholders divided by the weighted-average number of common shares outstanding for the period. Net loss applicable to common shareholders includes preferred stock dividends of $1 for each of the three months ended March 31, 2005 and 2004. Diluted loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. However, since the Company had a net loss for the three months ended March 31, 2005 and 2004, respectively, diluted loss per common share is the same as basic loss per common share, as any potentially dilutive securities would reduce the loss per common share applicable to common shareholders.

For the three months ended March 31, 2005, potentially dilutive securities not included in diluted loss per common share include 18,000,000 shares of convertible preferred stock, 2,442,007 stock options, 13,839,247 shares issuable upon conversion of mandatorily convertible notes, and 829,539 common shares issuable upon vesting of restricted stock units issued under the 2003 Global Crossing Limited Stock Incentive Program. For the three months ended March 31, 2004, potentially dilutive securities not included in diluted loss per common share include 18,000,000 shares of convertible preferred stock, 2,199,000 stock options, and 1,173,375 common shares issuable upon vesting of restricted stock units.

7. INCOME TAXES

For the three months ended March 31, 2005, the Company’s provision for income taxes was $9, of which $8 was attributable to the tax on current earnings, which was offset by realized pre-emergence net deferred tax assets. For the three months ended March 31, 2004, the Company’s provision for income taxes was $14, of which $11 was attributable to the tax on current earnings, which was offset by realized pre-emergence net deferred tax assets. The reversal of the related valuation allowance that existed at the fresh start date, which would have benefited earnings under SFAS No. 109, “Accounting for Income Taxes,” has instead been recorded as a reduction of intangibles. Once intangibles are reduced to zero, any remaining realization of pre-emergence net deferred tax assets will be recorded as an increase to additional paid in capital. This accounting treatment does not result in any change in liabilities to taxing authorities or in cash flows.

8. CONTINGENCIES

From time to time, the Company has been party to various legal proceedings in the ordinary course of business. In January 2002, the Company’s predecessor and a number of its subsidiaries (collectively, the “GC Debtors”) commenced cases under chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). On December 9, 2003, the

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joint plan of reorganization of the GC Debtors (the “Plan of Reorganization”) became effective and, pursuant to the Plan of Reorganization, Global Crossing Limited (“New GCL”) became the successor to Global Crossing Ltd., a company organized under the laws of Bermuda in 1997 (“Old GCL”). Under the Plan of Reorganization, essentially all claims against the GC Debtors that arose prior to the commencement of the chapter 11 cases were discharged. Claims for monetary damages (and equitable claims that give rise to a right to payment), including most of the legal proceedings pending against the GC Debtors at such time, were included in that discharge. However, certain claims pending at such time could affect the Company. The following is a description of those claims and of material legal proceedings in respect of claims alleged to have arisen after the commencement of the chapter 11 cases that were pending during or after the first quarter of 2005.

SBC Communications Inc. Claim

On November 17, 2004, certain affiliates of SBC Communications Inc. (“SBC”) commenced an action against the Company and other defendants in the United States District Court for the Eastern District of Missouri. In the complaint, SBC alleges that the Company, through certain unnamed intermediaries, which are characterized as “least cost routers,” terminated long distance traffic in a manner designed to avoid the payment of interstate and intrastate access charges.

Plaintiffs allege five causes of action: (1) breach of federal tariffs; (2) breach of state tariffs; (3) unjust enrichment (in the alternative to the tariff claims); (4) fraud; and (5) civil conspiracy. The complaint requests monetary and punitive damages, restitution, costs, and attorney’s fees, preliminary and permanent injuctive relief, an accounting, indemnification and other relief. Although the complaint does not contain a specific claim for damages, plaintiffs allege that they have been damaged in the amount of approximately $20 for the time period of February 2002 through August 2004. The Company filed a motion to dismiss the complaint on January 18, 2005, which motion was mooted by the filing of a First Amended Complaint on February 4, 2005. The First Amended Complaint added as defendants five competitive local exchange carriers and certain of their affiliates (none of which are affiliated with the Company) and re-alleged the same five causes of action. The Company filed a motion to dismiss the First Amended Complaint on March 4, 2005 and is awaiting the court’s decision.

Restatement Class Action Litigation

Following the Company’s April 27, 2004 announcement that the Company expected to restate certain of its consolidated financial statements as of and for the year ended December 31, 2003, eight separate class action lawsuits all purporting to be brought on behalf of Company shareholders were commenced against the Company and certain of its officers and directors in the United States District Courts in New Jersey, New York and California. The cases were consolidated and transferred by the Judicial Panel on Multidistrict Litigation to Judge Gerald Lynch of the United States District Court for the Southern District of New York. On February 18, 2005, lead plaintiffs filed an amended consolidated class action complaint against the Company and two of its past and present officers.

The consolidated amended complaint alleges that the Company defrauded the public securities markets by issuing false and misleading statements that failed to disclose or indicate (i) that the Company had materially understated its accrued cost of access liability by as much as $80, (ii) that the Company lacked sufficient internal controls to prevent material misstatements, (iii) that the Company lacked sufficient internal controls to properly record and report accrued cost of access liabilities and operating expenses, (iv) that its financial statements were not prepared in accordance with generally accepted accounting principles, (v) that the Company did not, contrary to its representations, consistently monitor the accuracy of its systems that measured cost of access, (vi) that the Company’s results were materially inflated, and (vii) that the Company did not have a “clean” balance sheet.

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The consolidated amended complaint, which was filed on behalf of a class of persons who purchased or acquired the Company’s common stock between December 9, 2003 and April 26, 2004, asserts claims under the federal securities laws, specifically Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Plaintiffs contend that the Company’s misstatements or omissions artificially inflated the price of the Company’s stock, which declined when the “true” costs were disclosed. Plaintiffs seek compensatory damages as well as other relief. If the case is not settled, defendants anticipate filing a motion to dismiss the consolidated amended complaint.

Securities and Exchange Commission Investigation

On February 5, 2002, the SEC commenced a formal investigation into the Company’s concurrent transactions for purchase and sale of telecommunications capacity and services between the Company and its carrier customers and related accounting and disclosure issues. On April 11, 2005, the Company consented to the entry of an administrative cease and desist order prohibiting the commission or causing of any future violations of certain reporting requirements under the Securities Exchange Act of 1934 and the rules promulgated thereunder. The consent order resolved the SEC’s investigation and did not require the Company to pay a civil penalty or any other fine.

Department of Justice Inquiry

In early 2002, the U.S. Attorney’s Office for the Central District of California, in conjunction with the Federal Bureau of Investigation (the “FBI”), began conducting an investigation into the Company’s concurrent transactions and related accounting and disclosure issues. The Company provided documents to the U.S. Attorney’s office and the FBI, and FBI representatives interviewed a number of current and former officers and employees of the Company. The Company does not know whether the investigation is ongoing or has concluded.

Claim by the United States Department of Commerce

A claim was filed in the Company’s bankruptcy proceedings by the United States Department of Commerce (the “Commerce Department”) on October 30, 2002 asserting that an undersea cable owned by Pacific Crossing Limited (“PCL”), a former subsidiary of the Company, violates the terms of a Special Use permit issued by the National Oceanic and Atmospheric Administration. The Company believes responsibility for the asserted claim rests entirely with the Company’s former subsidiary. An identical claim has also been filed in the bankruptcy proceedings of the former subsidiary in Delaware. On July 11, 2003, the Company and the Global Crossing Creditors’ Committee filed an objection to this claim with the Bankruptcy Court. Subsequently, the Commerce Department agreed to limit the size of the pre-petition portion of its claim to $14. Negotiations with PCL to resolve the remaining issues are ongoing but no final resolution has been reached.

United Kingdom Anti-Trust Investigation

On August 23, 2002, an investigation was commenced by the United Kingdom Office of Fair Trading (“OFT”) regarding an allegation that various subsea cable operator entities, including the Company, had engaged in an illegal agreement to collectively boycott a location in the United Kingdom (the “UK”) as a means for the landing of subsea telecommunications cables in the UK. The Company responded to that investigation in 2002 denying the allegation.

In August 2003, the OFT extended its investigation in respect of allegations of price fixing and information sharing on the level of fees that the subsea entities would pay landowners for permission to land submarine

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telecommunication cables on their land in the UK. The Company responded to those allegations on October 10, 2003. The Company has cooperated fully with the investigation and has supplied additional factual materials including a number of formal witness statements. By letter dated December 2, 2004, the OFT informed the Company and others that its investigation is continuing and that it will be issuing a Statement of Objections to a number of parties under investigation. The OFT has not, however, indicated which parties will be receiving such a statement and to date no findings have been made against the Company and the Company continues to deny any wrongdoing. On April 15, 2005, the Company received a request for the production of certain information to which the Company has responded. If the OFT determines that the Company engaged in anti-competitive behavior, the OFT may impose a fine up to a maximum of 10% of the Company’s revenue in this field of activity in the United Kingdom for up to three years preceding the year in which the infringement ended.

Customs Tax Audit

A tax authority in South America has concluded a preliminary audit of the Company’s books and records for the years ended December 31, 2001 and 2000 and has made certain initial findings adverse to the Company including the following: failure to disclose discounts on certain goods imported into the country, failure to include the value of software installed on certain computer equipment, and clerical errors in filed import documents. The Company has received a formal assessment in the amount of $9. The potential customs and duties exposure, including possible treble penalties to the Company, could be as high as $25 to $35. The Company is continuing to work with the tax authority to resolve the audit.

Foreign Income Tax Audit

A tax authority in South America has issued a preliminary notice of findings based on an income tax audit for calendar years 2001 and 2002. The examiner’s initial findings take the position that the Company incorrectly documented its importations and incorrectly deducted its foreign exchange losses against its foreign exchange gains on loan balances. Based on a preliminary notice of findings, the Company estimates that a future assessment could be as high as $11, plus potential interest and penalties. The Company is continuing to work with the tax authority to resolve the issues.

Administrative Claims from the Chapter 11 Case

Under the Plan of Reorganization, claims arising after the commencement of the GC Debtors’ chapter 11 cases (“Administrative Claims”) are generally to be paid in full. As is typical in chapter 11 cases, Administrative Claims were asserted against the GC Debtors that far exceed the amount owed. The Company has assumed the underlying obligations and is in the process of resolving such Administrative Claims. The Company does not believe that the resolution of those claims will have a material adverse effect on its financial position, results of operations, or cash flows.

Claim by Pacific Crossing Limited

This claim arises out of the management of the PC-1 trans-Pacific fiber optic cable, which was constructed, owned and operated by Pacific Crossing Limited (“PCL”), a former subsidiary of the Company. PCL asserts that the Company and Asia Global Crossing, another former subsidiary of the Company, breached their fiduciary duties to PCL, improperly diverted revenue derived from sales of capacity on PC-1, and failed to account for the way revenue was allocated among the corporate entities involved with the ownership and operation of PC-1. The claim also asserts that revenues derived from operation and maintenance fees were also improperly diverted and that PCL’s expenses increased unjustifiably through agreements executed by the Company and Asia Global Crossing on behalf of PCL.

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During the pendency of the Company’s Chapter 11 proceedings, on January 14, 2003, PCL filed an administrative expense claim in the Bankruptcy Court for $8 in post-petition services plus unliquidated amounts arising from the Company’s alleged breaches of fiduciary duty and misallocation of PCL’s revenues. The Company objected to the claim and asserted that the losses claimed were the result of operational decisions made by PCL management and its corporate parent, Asia Global Crossing. On February 4, 2005, PCL filed an amended claim in the amount of $79 claiming the Company failed to pay revenue for services and maintenance charges relating to PC-1 capacity and failed to pay PCL for use of the related cable stations and seeking to recover a portion of the monies received by the Company under a settlement agreement entered into with Microsoft and an arbitration award against Softbank. PCL claims that the Company acted as an agent for PCL under the original capacity commitment agreement with Microsoft and Softbank and that PCL is now entitled to a share of the proceeds of both the settlement and the arbitration award. The Company filed an objection to the amended claim seeking to dismiss, expunge and/or reclassify the claim and PCL responded to the objection by filing a motion for partial summary judgment claiming approximately $22 million for the capacity, operations and maintenance charges and co-location charges. It is anticipated that there will be a hearing on both the objection and the motion in May 2005.

Foreign Government Highways Tax

On December 20, 2004, representatives of one of the Company’s European subsidiaries were advised at a meeting with the applicable governmental agency for highways that a tax would be levied on the Company in respect of the Company’s network in that country. In particular, the tax was to be assessed on the estimated value of public lands across which the Company’s network is laid and would be retroactive to the date of occupancy by the Company of the lands at issue. The Company has received assessments totaling $4. The Company believes that all other telecommunications operators in that country whose networks cross these public lands are receiving similar assessments. The Company believes that many other operators have challenged the nature and calculation of this tax and have raised a number of technical and legal points against the assessments. The Company has formally appealed all tax assessments received and is engaged in ongoing discussions with the taxing authority with the intention of significantly reducing the amounts assessed.

9. RELATED PARTY TRANSACTIONS

Commercial and other relationships between the Company and ST Telemedia

During the three months ended March 31, 2005 and 2004, the Company provided approximately $0.2 and $0.4, respectively, of telecommunications services to subsidiaries and affiliates of the Company’s majority shareholder and parent company, Singapore Technologies Telemedia Pte Ltd (“ST Telemedia”). Further, during the three months ended March 31, 2005 and 2004, the Company received approximately $0.1 and $0.2 of co-location services from an affiliate of ST Telemedia and accrued dividends and interest of $7.8 and $6.6, respectively, related to debt and preferred stock held by affiliates of ST Telemedia.

At March 31, 2005 and December 31, 2004, the Company had approximately $12.1 and $4.4, respectively, due to ST Telemedia and its subsidiaries and affiliates, and approximately $0.1 and $0.1, respectively, due from ST Telemedia and its subsidiaries and affiliates. The amounts due to ST Telemedia and its subsidiaries and affiliates relate to interest due under the $250 aggregate principal amount of 4.7% payable in kind mandatory convertible notes held by subsidiaries of ST Telemedia (the “Convertible Notes”) and dividends accrued on the Company’s 2% cumulative senior convertible preferred stock, and are included in “other current liabilities” and “other deferred liabilities,” respectively, in the accompanying consolidated balance sheets.

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According to filings made with the SEC, Carlos Slim Helu and members of his family (collectively, the “Slim Family”), together with entities controlled by the Slim Family, held greater than 10% of the Company’s common stock as of March 31, 2005. Accordingly, the members of the Slim Family may therefore be considered related parties of the Company. During the three months ended March 31, 2005 and 2004, the Company engaged in various commercial transactions in the ordinary course of business with telecommunications companies controlled by or subject to significant influence from the Slim Family (“Slim-Related Entities”). Specifically, during the three months ended March 31, 2005 and 2004, the Company provided approximately $2.4 and $0.7, respectively, of telecommunications services to Slim-Related Entities and purchased approximately $1.4 and $1.2, respectively, of access related services from Slim-Related Entities.

10. DISCONTINUED OPERATIONS

Sale of Global Marine and SB Submarine Systems Company Ltd (“SBSS”)

On August 13, 2004, the Company entered into a series of agreements with Bridgehouse Marine Limited (“Bridgehouse”) for the sale of Global Marine Systems Limited (together with its subsidiaries, “Global Marine”) and the transfer of the Company’s forty-nine percent shareholding in SBSS, a joint venture primarily engaged in the subsea cable installation and maintenance business in China, to Bridgehouse for consideration up to $15, subject to certain conditions set forth in the agreements. During the third quarter of 2004, the Company completed the sale of Global Marine for consideration of $1. No gain or loss was recorded on the sale. As a result of this transaction, Bridgehouse has assumed all of Global Marine’s capital and operating lease commitments.

The sale of the Company’s interest in SBSS is not yet completed and is currently subject to the approval of the other joint venture holder and regulatory approval of the Chinese government, which is expected to occur by mid-2005. The Company’s agreement for the transfer of its interest in SBSS to Bridgehouse expires in October 2005.

The operating results for Global Marine and SBSS were as follows for the three months ended:


	March 31, 2004
Revenue	$	30
Operating expenses		43

Operating loss		(13	)
Provision for income taxes		—

Loss from discontinued operations	$	(13	)

11. SALE OF BUSINESSES

Trader Voice

On March 22, 2005 the Company entered into an agreement to sell its Trader Voice business to WestCom Corporation (“WestCom”). On May 3, 2005, the Company completed the sale of its Trader Voice business, after receiving all necessary regulatory approvals, and received approximately $22 of net cash proceeds from the transaction, after giving effect to the payment of certain fees and the deduction of certain retained liabilities. The

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On March 21, 2005, the Company entered into an agreement to sell its small business group to Matrix Telecom, a Platinum Equity company. Under the agreement, the Company will receive $40.5 in gross cash proceeds for SBG, which provides voice and data products to approximately 30,000 small to medium-sized businesses in the United States. The sale is subject to regulatory approval and is expected to close during the three months ended September 30, 2005. The Company expects approximately $35 in net cash proceeds from the transaction after giving effect to estimated purchase price adjustments, the payment of certain fees and the deduction of certain retained liabilities.

In addition to the agreement, the parties have entered into a long-term carrier services agreement, under which Global Crossing will provide to Matrix wholesale voice, data and IP services. Revenues under this carrier services agreement are in addition to the cash proceeds mentioned above.

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The following is a discussion of our results of operations and current financial position. This discussion should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this report and the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2004, as amended.

As used in this quarterly report on Form 10-Q, references to the “Company,” “we,” “us,” “our” or similar terms include Global Crossing Limited and its consolidated subsidiaries.

Cautionary Note Regarding Forward-Looking Statements

Our disclosure and analysis in this quarterly report on Form 10-Q contain certain “forward-looking statements,” as such term is defined in Section 21E of the Securities Exchange Act of 1934. These statements set forth anticipated results based on management’s plans and assumptions. From time to time, we also provide forward-looking statements in other materials we release to the public as well as oral forward-looking statements. Such statements give our current expectations or forecasts of future events; they do not relate strictly to historical or current facts. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance or strategies. Such forward-looking statements include, but are not limited to, statements regarding:

•

our services, including the development and deployment of data products and services based on Internal Protocol, or IP, and other technologies and strategies to expand our targeted customer base and broaden our sales channels;

•

the operation of our network, including with respect to the development of IP protocols;

•

our liquidity and financial resources, including anticipated capital expenditures, funding of capital expenditures and anticipated levels of indebtedness;

•

trends related to and management’s expectations regarding results of operations, revenues and cash flows, including but not limited to those statements set forth below in this Item 2; and

•

business restructuring activities sales efforts, expenses, interest rates, foreign exchange rates, and the outcome of contingencies, such as legal proceedings.

We cannot guarantee that any forward-looking statement will be realized. Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements.

We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our quarterly reports on Form 10-Q and current reports on Form 8-K. Also note that we provide the following cautionary discussion of risks and uncertainties related to our business. These are factors that we believe, individually or in the aggregate, could cause our actual results to differ materially from expected and historical results. We note these factors for investors as permitted by the Section 21E of the Securities Exchange Act of 1934. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider the following to be a complete discussion of all potential risks or uncertainties.

Our forward-looking statements are subject to a variety of factors that could cause actual results to differ significantly from current beliefs and expectations. In addition to the risk factors identified under the captions below, the operation and results of our business are subject to general risks and uncertainties such as those relating to general economic conditions and demand for telecommunications services.

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The calculation of our real estate restructuring reserve involves the estimation of receipts from subleases to third parties, including projections of material receipts from subleases to be entered into the future. Although we believe these estimates to be reasonable, actual sublease receipts could turn out to be materially different than we have estimated.

Risks Related to Competition and our Industry

•

The prices that we charge for our services have been decreasing, and we expect that such decreases will continue over time.

•

Technological advances and regulatory changes are eroding traditional barriers between formerly distinct telecommunications markets, which could increase the competition we face and put downward pressure on prices.

•

Many of our competitors have superior resources, which could place us at a cost and price disadvantage.

•

Our selection of technology could prove to be incorrect, ineffective or unacceptably costly, which would limit our ability to compete effectively.

•

Our operations are subject to regulation in the United States and abroad and require us to obtain and maintain a number of governmental licenses and permits. Moreover, those regulatory requirements could change in a manner that significantly increases our costs or otherwise adversely affects our operations.

•

Terrorist attacks and other acts of violence or war may adversely affect the financial markets and our business and operations.

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We are a global provider of telecommunications services to carriers and commercial enterprises around the world. The principal services we offer to our customers include voice, data and conferencing services. We offer these services using a global IP-based network that directly connects more than 300 cities in over 30 countries and delivers services to more than 500 major cities in over 50 countries around the world. The majority of our telecommunications services revenues and cash flows are generated based on monthly recurring services.

Due to certain organizational and financial reporting changes relating to the issuance of the GCUK Notes and the planned registration with the SEC of an exchange offer in respect of such securities during 2005, in the first quarter of 2005 we evaluated the status of anticipated changes in management structure and the possible requirement to treat GCUK as a reportable segment in accordance with Statements of Financial Accounting Standards No. 131, “Disclosures about segments of an Enterprise and Related Information” (“SFAS 131”). Since our chief operating decision maker continues to make decisions regarding allocation of the Company’s resources based primarily on our globally integrated functional groups (e.g., sales, customer service, network operations, information technology, finance, legal and human resources), we have determined that the Company continues to operate as one reportable segment engaged in the telecommunications services business. We will continue to monitor and assess the impact of organizational and management developments on our analysis under SFAS 131.

First Quarter 2005 Highlights

As previously disclosed in October 2004, we initiated a restructuring plan to focus our operations on our core enterprise and carrier data sales business and to pursue several new business initiatives in areas where we can capitalize on our IP network and capabilities, de-emphasize lower margin services, specifically carrier voice services, and exit non-core operations lines of business. During the first quarter of 2005, we continued implementing these restructuring activities, which resulted in anticipated reductions in revenue from our carrier voice line of business, growth in revenue of our core lines of business, improvement in our total gross margin and the execution of agreements for the sale of two non-core lines of our business as described below.

Our gross margin is calculated by subtracting our cost of access expense from revenue (see table below). As a result of our business restructuring activities above and cost of access initiatives we have significantly increased our gross margin in absolute terms and as a percentage of consolidated revenue. Our consolidated gross margin increased $19 million in the first quarter of 2005 compared with the first quarter of 2004. The increase comprises a $24 million improvement in gross margins in the Company’s operations outside of the United Kingdom, partially offset by a $5 million reduction in gross margins from GCUK.

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On March 22, 2005 we entered into an agreement to sell our financial industry trader voice business (“Trader Voice”) to WestCom Corporation (“WestCom”). On May 3, 2005, we completed the sale of Trader Voice after receiving all necessary regulatory approvals, and received approximately $22 million of net cash proceeds from the transaction, after giving effect to the payment of certain fees and the deduction of certain retained liabilities. The net cash proceeds included a three-year, $0.7 million prepayment for bandwidth and co-location services under a wholesale services agreement executed with WestCom.

On March 21, 2005, we entered into a purchase agreement to sell our small business group (“SBG”) to Matrix Telecom, a Platinum Equity company. Under the agreement, the Company will receive $40.5 million in gross cash proceeds for SBG, which provides voice and data product to approximately 30,000 small to medium-sized businesses in the U.S. The sale is subject to regulatory approval and is expected to close during the three months ended September 30, 2005. We expect approximately $35 million in net cash proceeds from the transaction after giving effect to estimated purchase price adjustments, the payment of certain fees and the deduction of certain retained liabilities.

During the first quarter of 2005, our operations continued to generate negative cash flows, which reduced our available liquidity. At March 31, 2005 we had $277 million of unrestricted cash. We expect our available liquidity to continue to decline substantially during the remainder of 2005 due to operating cash flow requirements and estimated payments related to deferred reorganization costs. We expect our quarterly cash flows used by operations to improve during the remainder of 2005 as a result of further implementation of our restructuring plan discussed above. Based on our business plan, our expectation is that cash on hand, together with proceeds from anticipated sales of non-core assets (including those describe above), marketable securities and Indefeasible Rights of Use will provide us with the liquidity needed to fund our operations until we start to generate positive cash flow at some point in the second half of 2006.

During the three months ended March 31, 2005, we increased our restructuring reserves, related to 2003 and prior restructuring plans, for facility closings by $24 million. This reserve is composed of continuing building lease obligations and estimated decommissioning costs and broker commissions for the restructured sites (aggregating $425 million as of March 31, 2005), offset by anticipated receipts from existing and future third-party subleases. As of March 31, 2005, anticipated third-party sublease receipts were $274 million, representing $79 million from subleases already entered into and $195 million from subleases projected to be entered into in the future. We continue to review our anticipated costs and third-party sublease payments on a quarterly basis and record adjustments for changes in the estimates in the period such changes become known. During the three months ended March 31, 2005, we reduced our estimated third-party sublease payments due to a decline in the sublet demand for space in the applicable locales, principally in Europe. At March 31, 2005, we maintain a restructuring reserve for facility closings of $151 million.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon the accompanying condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Although these estimates are based on our knowledge of

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current events, actual amounts and results could differ from those estimates. The estimates made are based on historical factors, current circumstances, and the experience and judgment of our Company’s management, who continually evaluate the judgments, estimates and assumptions and may employ outside experts to assist in the evaluations.

Certain of our accounting policies are deemed “critical,” as they are both most important to the financial statement presentation, and require management’s most difficult, subjective or complex judgments as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a discussion of our critical accounting policies, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K for the year ended December 31, 2004, as management believes there have been no significant changes regarding our critical accounting policies since such time.

Results of Operations


	Three Months Ended March 31,						$ Increase/ (Decrease)			% Increase/ (Decrease)
	2005			2004			$ Increase/ (Decrease)			% Increase/ (Decrease)
	(in millions)
Revenue	$	526		$	666		$	(140	)	(21	)%
Cost of access		(320	)		(479	)		(159	)	(33	)%
Third party maintenance		(26	)		(31	)		(5	)	(16	)%
Other operating expenses		(208	)		(193	)		15		8	%
Depreciation and amortization		(37	)		(43	)		(6	)	(14	)%

Operating loss		(65	)		(80	)
Interest expense, net		(21	)		(5	)		16		320	%
Other income (expense), net		(13	)		4			17		425	%

Loss from continuing operations before reorganization items		(99	)		(81	)
Net gain on preconfirmation contingencies		2			—			(2	)	—

Loss from continuing operations before income taxes		(97	)		(81	)
Provision for income taxes		(9	)		(14	)		(5	)	(36	)%

Loss from continuing operations		(106	)		(95	)
Loss from discontinued operations, net of income tax		—			(13	)		(13	)	—

Net loss	$	(106	)	$	(108	)
Preferred stock dividends		(1	)		(1	)		—		—

Loss applicable to common shareholders	$	(107	)	$	(109	)

Revenue. Revenues for the three months ended March 31, 2005 and 2004 reflect the following changes.


	Three Months Ended March 31,				$ Increase/ (Decrease)			% Increase/ (Decrease)
	2005		2004		$ Increase/ (Decrease)			% Increase/ (Decrease)
	(in millions)
Revenues:
Enterprise, carrier data and indirect channels	$	273	$	268	$	5		2	%
Carrier voice		219		351		(132	)	(38	)%
Consumer voice, small business group and trader voice		34		47		(13	)	(28	)%

Consolidated revenues	$	526	$	666	$	(140	)	(21	)%

Enterprise, carrier data, and indirect channels. Enterprise, carrier data and indirect channels represent areas in which we are investing our resources to grow our business. Enterprise consists of the provision of voice, data

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and collaboration services to our customers other than carriers, consumers, and Trader Voice and SBG customers. Carrier data consists of the provision of our data products, including IP, transport and capacity services, to our telecommunications carrier customers. Indirect channels consist of the provision of voice, data and managed services through partnerships with telecommunications carriers and system integrators. Revenue in these areas increased in the first quarter of 2005 compared with the first quarter of 2004 as a result of customer acquisition and existing customer base growth in specific enterprise and carrier target markets which resulted in an increase in sales volume. There was a modest increase in revenue related to sales through indirect channels. The increase in revenue related to increases in sales volume to new and existing customers, which were partially offset by declines in prices for both voice and IP access telecommunications services as well as customer attrition. Prices for commoditized voice and IP access services declined approximately 15% and 30%, respectively, while prices for premium products such as IP VPN, video conferencing and managed services, declined minimally. Revenue from our GCUK subsidiary declined $3 million to $111 million in the first quarter of 2005 compared with $114 million in the first quarter of 2004.

Carrier voice. Carrier voice represents the provision of domestic and international voice services to our carrier customers. Carrier voice revenues decreased in the first quarter of 2005 compared with the first quarter of 2004 as a result of: our business restructuring activities announced in the fourth quarter of 2004 to downsize our carrier voice business through pricing actions designed to maintain targeted gross margins; the tightening of our payment terms for long distance reseller customers, which resulted in the non-renewal of certain low margin wireless contracts; and a slight decrease in average unit prices

Consumer voice, SBG and Trader Voice. Consumer voice, SBG and Trader Voice represent non-core lines of business that we are either divesting or exiting. Revenue for these lines of businesses declined in the first quarter of 2005 compared with the first quarter of 2004 a result of pricing reductions and the minimization of our investment in these non-core lines of businesses. As described above in this Item under “Executive Summary – First Quarter 2005 Highlights,” we have sold Trader Voice and entered into an agreement to sell SBG.

Cost of access. Cost of access primarily includes (i) usage based voice charges paid to local exchange carriers and interexchange carriers to originate and/or terminate switched voice traffic and (ii) charges for leased lines for dedicated facilities and local loop (“last mile”) charges from both domestic and international carriers. Cost of access charges decreased as a result of: our cost of access initiatives to optimize the access network and effectively lower cost of access unit prices; reductions in the amount of usage-based access services purchased due to lower carrier voice sales volume; and a more favorable mix of sales of data, IP and managed services.

Third-party maintenance. Third-party maintenance expenses decreased as a result of renegotiating certain maintenance agreements. Specific renegotiations included term extensions, which resulted in lower annual charges, and amendments to change maintenance charges from a standing fixed charge to a variable charge based on actual vendor time and material charges incurred.

Operating expenses. Operating expenses consist of (i) cost of sales relating to our managed services and collaboration services; (ii) real estate and network operations-related expenses, including all administrative real estate costs; (iii) salaries and benefits; (iv) restructuring costs; (v) stock-related expenses related to employee stock options and restricted stock units; (vi) cash incentive compensation; and (vii) non-income taxes, including property taxes on owned real estate and trust fund related taxes such as gross receipts taxes, franchise taxes and capital taxes.

The increase in operating expenses for the first quarter of 2005 compared with the first quarter of 2004 is primarily a result of (i) a $21 million increase in restructuring costs as a result of lowering our estimated sublease payments to be received for restructured facilities related to 2003 and prior restructuring plans; (ii) an $8 million increase in stock related expenses as a result of additional grants during 2004 after the first quarter and 50% of our 2005 annual bonus being payable in restricted stock units, subject to shareholder approval of a sufficient increase in the shares available (as opposed to the 2004 annual bonus, which was payable 100% in cash); and (iii)

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a $4 million increase in cash incentive compensation related to accruing the 2005 annual bonus program at full plan targets (as opposed to the 2004 annual bonus program, which was accrued at a significant discount due to performance below bonus plan targets) and recording expenses related to the cash portion of the Senior Leadership Performance Program.

The increase in operating expenses is offset partially by decreases in the following: (i) a $4 million decrease in salaries and benefits as a result of a reduction in workforce related to our business restructuring activities implemented in the fourth quarter of 2004, partially offset by an increase in sales commissions; (ii) a $4 million decrease in real estate and network operations related expenses as a result of receiving approximately $2 million in property tax rebates and recording lower property tax charges during the first quarter of 2005; and (iii) a decrease of $7 million in miscellaneous expenses, including the impact of a $5 million excess medical contribution on the first quarter of 2005.

Depreciation and amortization. Depreciation and amortization consists of depreciation of property and equipment, amortization of customer installation costs and amortization of identifiable intangibles. Depreciation and amortization decreased in the first quarter of 2005 as a result of (i) a significant reduction in intangible amortization as a result of reductions in intangible assets due to fresh start accounting and tax adjustments during 2005 and 2004 and (ii) a decrease in prepaid installation amortization due to the write-off of prepaid installation charges during 2004. The decrease related to these items was partially offset by accelerated depreciation related to certain fixed assets that were decommissioned in February 2005 and depreciation expense from capital purchases made after the first quarter of 2004.

Interest expense, net. Interest expense includes interest related to the $200 million in aggregate principal amount of 10.75% United States dollar denominated senior secured notes and £105 million principal amount of 11.75% pounds sterling denominated senior secured notes (collectively, the “GCUK Notes”), the $250 million aggregate principal amount of 4.7% payable in kind mandatory convertible notes (the “Convertible Notes”), capital lease obligations, certain tax liabilities and amortization of deferred finance costs related to the GCUK Notes and interest income. Interest expense for the three months ended March 31, 2005 increased $16 million primarily due to interest incurred under the GCUK Notes and Convertible Notes, which were issued in December 2004.

Other income (loss), net. Other income (loss), net decreased in the first quarter of 2005 primarily as a result of changes in the amount of gains and losses resulting from foreign currency impacts on transactions and an $8 million gain in the first quarter of 2004 for recovery of legal fees incurred for class action lawsuits under our directors and officers liability insurance policy. Foreign currency transaction losses increased $7 million to $13 million compared with $6 million in the first quarter of 2004.

Provision for income taxes. Provision for income taxes decreased primarily as a result of a change in the mix of earnings to jurisdictions with lower tax rates and a reduction in the liability for asset taxes.

Liquidity and Capital Resources

Financial Condition and State of Liquidity

At March 31, 2005, our available liquidity consisted of $277 million of unrestricted cash and cash equivalents. In addition, we also held $22 million in restricted cash and cash equivalents of which $15 million is included in other assets in the accompanying unaudited condensed consolidated balance sheet. The restricted cash and cash equivalents represent collateral relating to certain rental guarantees, performance bonds, letters of credit and deposits.

For each period since we commenced operations, we have incurred substantial operating losses. For the three months ended March 31, 2005, we posted a net operating loss of approximately $65 million and utilized net

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cash for operating and investing activities aggregating approximately $83 million. In the near term, our existing and projected operations are not expected to generate cash flows sufficient to pay our expected operating expenses, fund our expected capital expenditure requirements, meet our debt service obligations and meet our restructuring cost requirements. We expect our available liquidity to substantially decline in 2005 due to operating cash flow requirements and Plan of Reorganization-related payments for deferred reorganization costs. However, during the fourth quarter of 2004, we completed a recapitalization plan pursuant to which we restructured existing indebtedness with ST Telemedia and its subsidiaries and raised additional financing. Based on our business plan, our expectation is that this financing, together with proceeds from anticipated sales of IRUs, marketable securities and non-core assets (including SBG and Trader Voice), will provide us with the liquidity needed to fund our operations until we start to generate positive cash flow at some point in the second half of 2006.

As a holding company, all of our revenues are generated by our subsidiaries and substantially all of our assets are owned by our subsidiaries. As a result, we are dependent upon dividends and inter-company transfer of funds from our subsidiaries to meet our debt service and other payment obligations. Our subsidiaries are incorporated and operate in various jurisdictions throughout the world. Certain of our subsidiaries have cash on hand that exceeds their immediate requirements but that cannot be distributed or loaned to us or our other subsidiaries to fund our or their operations due to contractual restrictions or legal constraints related to the solvency of such entities. These restrictions could cause us or certain other subsidiaries to become and remain illiquid while other subsidiaries have sufficient liquidity to meet their liquidity needs.

In particular, GCUK serves as a source of funding for us and our other subsidiaries, and we expect to continue to use GCUK as a source of funding, subject to the covenants in the GCUK Notes indenture and restrictions under English law. Because of losses that GCUK has accumulated, it will not be possible for GCUK to pay dividends to its parent company, an indirect subsidiary of ours, until such time as these losses have been reduced and thereafter only to the extent of any available profit. Until that time, any funds to be made available by GCUK to us and our other subsidiaries will be made through inter-company loans. However, GCUK’s ability to make loans to us and our other subsidiaries is restricted by the indenture governing the GCUK Notes. Under that indenture, such a loan (i) may be made only if GCUK is not then in default under the indenture and would be permitted at that time to incur additional indebtedness under the applicable debt incurrence test and (ii) would be limited to, among other things, 50% of GCUK’s consolidated net income plus non-cash charges minus capital expenditures (“Designated GCUK Cash Flow”). Under the indenture governing the Convertible Notes, loans from GCUK made to us or our other subsidiaries must be subordinated to the payment of obligations under the Convertible Notes. The terms of any inter-company loan by GCUK to us or our other subsidiaries must be agreed to by the board of directors of GCUK, including its independent members, who are also members of its audit committee. In addition, within 120 days after the end of the period beginning on December 23, 2004 and ending December 31, 2005 and for each twelve month period thereafter, GCUK must offer to purchase a portion of the GCUK Notes at a purchase price equal to 100% of their principal amount, plus accrued and unpaid interest, if any, to the purchase date, with 50% of Designated GCUK Cash Flow from that period. To the extent that holders of GCUK Notes do not fully participate in the repurchase offer, the loan or dividend of any remaining proceeds up to this additional 50% of Designated GCUK Cash Flow to the Company and its affiliates would be permitted, subject to the limitations on restricted payments described above.

A default by any of our subsidiaries under any capital lease obligation or debt obligation totaling more than $2.5 million, as well as the bankruptcy or insolvency of any of our subsidiaries, could trigger cross-default provisions under the indenture for the Convertible Notes and may trigger cross-default provisions under any working capital facility or other financing that we may arrange. This could lead the applicable debt holders to accelerate the maturity of their relevant debt instruments, foreclose on our assets and adversely affect our rights under other commercial agreements, which would have a material adverse effect on our financial condition. In addition, in the event of a “Conversion Restriction” (as defined in the indenture for the Convertible Notes), we could be required to redeem the Convertible Notes for $250 million, plus accrued interest at 11% (calculated retroactively from the issue date).

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Depending upon business opportunities and market conditions arising from time to time, we may in the future enter into additional financing arrangements, which could include a working capital facility. Our ability to do so is subject to the limitations in the covenants in our outstanding debt instruments and to the rights of ST Telemedia under our outstanding preferred shares (see Item 5 “Market for the Registrant’s Common Stock and Related Stockholder Matters - Description of New Global Crossing Equity Securities”, of our 2004 annual report on Form 10-K).

Indebtedness

At March 31, 2005, we had $642 million of long-term indebtedness outstanding, consisting of $392 million GCUK Notes and $250 million of Convertible Notes. We did not incur any new indebtedness during the first quarter of 2005. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources”, of our 2004 10-K, for a description of the GCUK Notes and Convertible Notes. We are in compliance with all covenants under the GCUK Notes and Convertible Notes indentures.

Cash Management Impacts and Working Capital

Our working capital deficit increased $46 million to a working capital deficit of $103 million at March 31, 2005 compared to a working capital deficit of $57 million at December 31, 2004. This increase is primarily a result of operating cash flow losses and capital expenditures.

Cash Flow Activity for the three months ended March 31, 2005

Cash and cash equivalents decreased $88 million during the three months ended March 31, 2005 to $277 million from $365 million at December 31, 2004. The decrease resulted from continued operating cash flow losses and payments made for capital expenditures, restructuring costs and deferred reorganization costs.

During the first quarter of 2005, we collected approximately $557 million of cash receipts from sales of services. We also collected approximately $3 million related to prepaid service/IRU agreements. Operating expense disbursements were approximately $623 million for the first quarter of 2005. Cash paid for capital expenditures and the repayment of capital lease obligations were approximately $24 million and $3 million, respectively. Payments related to deferred reorganization costs and restructuring costs were approximately $6 million and $12 million, respectively, during the first quarter of 2005. Miscellaneous receipts collected during the first quarter of 2005 were approximately $25 million, which included approximately $13 million related to VAT refunds, $1 million related to a property tax rebate, and $3 million in other miscellaneous receipts.

The following table is a summary of our condensed consolidated statements of cash flows for the three months ended March 31, 2005 and 2004:


	Three Months Ended March 31,						$ Increase/ (Decrease)
	2005			2004			$ Increase/ (Decrease)
	(in millions)
Net cash flows used in operating activities	$	(54	)	$	(39	)	$	15
Net cash flows used in investing activities		(29	)		(25	)		4
Net cash flows used in financing activities		(3	)		(3	)		—
Effect of foreign exchange rates on cash and cash equivalents		(2	)		2			4

Net decrease in cash and cash equivalents	$	(88	)	$	(65	)	$	23

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Cash flows used in operations increased in the first quarter of 2005 as compared with the first quarter of 2004 primarily as a result of lower cash flows provided from changes in operating assets and liabilities. Cash flows provided from changes in operating assets and liabilities decreased $48 million in the first quarter of 2005 to $(17) million from $31 million in the first quarter of 2004. The decrease was primarily due to a $35 million reduction in prepaid service/IRU receipts in the first quarter of 2005. During the first quarter of 2004 we received $38 million of receipts related to a prepaid service/IRU from one customer, which represented the final installment due under a settlement agreement entered into during 2003. Changes in operating assets and liabilities are subject to significant variability from quarter to quarter depending on the timing of operating cash receipts and payments. The increase in cash flows used in operations was partially offset by a decrease in reorganization payments. Deferred reorganization cost decreased $25 million in the first quarter of 2005 to $6 million as compared with $31 million in the first quarter of 2004. The decrease in reorganization related payments is due to the majority of payments owed to access providers and other non-tax authority claimants being due during 2004. GCUK’s cash flows provided by operations in the first quarter of 2005 was $11 million.

Cash Flows from Investing Activities

Cash flows used in investing activities increased in the first quarter of 2005 compared with the first quarter of 2004 primarily due to a $5 million increase in restricted cash and receipt of $4 million in proceeds for the sale of our equity interests in two non-operating holding companies in the first quarter of 2004. The increase in restricted cash is related to cash collateralizing a letter of credit for the resolution of a disputed property tax assessment on our capital assets in a foreign jurisdiction and a $1 million security deposit for an office building. The increase was partially offset by a decrease of $5 million in capital expenditures in the first quarter of 2005 compared with the first quarter of 2004. Capital expenditures in the first quarter of 2005 primarily related to network and information technology expenditures. The network expenditures primarily consist of capital spending to meet our anticipated network needs to acquire and/or expand existing customer service requirements. These expenditures include significant amounts to begin the process of converting several of our points of presences from time division multiplexing technology to voice over Internet protocol technology. The information technology expenditures include projects to upgrade our software to support local number portability. GCUK’s cashflows used in investing activities in the first quarter of 2005 was $6 million.

Cash Flows from Financing Activities

Cash flows from financing activities for the three months ended March 31, 2005 include the repayment of capital lease obligations, proceeds for the exercise of stock options, and financing costs related to the GCUK Notes. Cash flows from financing activities for the three months ended March 31, 2004 were limited to the repayment of capital lease obligations. The majority of the capital lease payments related to GCUK’s network along railway routes in the United Kingdom. GCUK’s cashflows used in financing activities in the first quarter of 2005 was $4 million.

Contractual Cash Commitments

There were no material changes in our contractual cash commitments during the three months ended March 31, 2005.

Credit Risk

We are subject to concentrations of credit risk in our trade receivables. Although our receivables are geographically dispersed and include customers both large and small and in numerous industries, our revenue in our carrier sales channel is generated from services to other carriers in the telecommunications industry. For the three months ended March 31, 2005 and 2004, our revenues from the carrier voice sales channel represented approximately 42% and 53%, respectively, of our consolidated revenues.

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Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by a public company in the reports that it files or submits under the Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms.

In connection with the preparation of this quarterly report on Form 10-Q, management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures, pursuant to Rule 13a-15 under the Exchange Act. Based upon management’s evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective at a reasonable assurance level as of March 31, 2005 due to deficiencies in our internal control over financial reporting. These deficiencies, which were previously identified as material weaknesses in internal control over financial reporting as of December 31, 2004 in our Amendment No. 1 on Form 10-K/A filed on April 28, 2005, can be summarized as follows: (i) we did not maintain appropriate control over non-routine processes, estimation processes and account reconciliations in the overall financial close process and (ii) we did not maintain appropriate control over the estimation processes for the allowances for bad debt and sales credits. Please see our Form 10-K/A for a further description of these material weaknesses and a description of our remediation plan. We expect to complete implementation of the measures necessary to remediate the material weaknesses by the end of the third quarter of 2005.

Changes in Internal Control Over Financial Reporting

There were no material changes in our internal control over financial reporting during the first quarter of 2005.

During the first quarter of 2005, we began implementing remediation measures by hiring William I. Lees, Jr., an executive with accounting and financial management expertise, who commenced employment as our Chief Accounting Officer. Mr. Lees is responsible for overseeing all accounting and financial reporting matters of the Company. Additionally, on April 1, 2005, we hired William Ginn, an executive with accounting and financial management expertise, to serve as Vice-President Finance for our GCUK subsidiary.

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The Company held an Extraordinary General Meeting of Shareholders on February 28, 2005 to consider and act upon a proposal to approve the anti-dilution provisions of the Convertible Notes and to ratify the issuance of such notes and the Board of Director’s approval of the issuance of the common shares into which they are convertible. These anti-dilution provisions provide that if the Company were to engage in a new equity issuance within six months of the December 23, 2004 date on which the Convertible Notes were issued at a price per common share less than $15.49, the number of common shares into which the Convertible Notes would be convertible would be increased proportionally pursuant to a formula described in the Convertible Notes indenture. This Proposal was approved at the Extraordinary General Meeting, with the specific voting results as follows:


Proposal Number and Description	Shares For	Shares Against	Abstentions
1. Proposal to consider and act upon a proposal to approve the anti-dilution provisions of Global Crossing’s $250 million aggregate principal amount of 4.7% Senior Secured Mandatory Convertible Notes due 2008 and to ratify the issuance of such notes and the Board of Director’s approval of the issuance of the common shares into which they are convertible.	27,161,405	34,480	7,294

Item 6. Exhibits

Exhibits filed as part of this report are listed below.


2.9		Asset Purchase Agreement by and between Global Crossing Telecommunications, Inc. and Matrix Telecom, Inc. dated as of March 19, 2005 (filed herewith). (The schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Pursuant to this regulation, the registrant hereby agrees to furnish a copy of any such instrument to the SEC upon request.)

2.10		Asset Purchase Agreement between Global Crossing Holdings Limited and WestCom Corporation, dated as of March 25, 2005 (filed herewith). (The schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Pursuant to this regulation, the registrant hereby agrees to furnish a copy of any such instrument to the SEC upon request.) The registrant has applied for confidential treatment with respect to portions of this Exhibit. An unredacted version of this Exhibit has been filed separately with the Securities and Exchange Commission.

10.21		Employment Agreement, as amended, dated as of September 4, 2000 between Phil Metcalf and Global Crossing Network Centre (UK) Ltd. (filed herewith).

10.22		Global Crossing Limited 2005 Annual Bonus Program (filed herewith).

31.1		Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

31.2		Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

32.2		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

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G LOBAL C ROSSING L IMITED

By:		/s/ J EAN F.H.P. M ANDEVILLE
		Jean F.H.P. Mandeville Chief Financial Officer *(Principal Financial Officer)*

By:		/s/ W ILLIAM I. L EES , J R .
		William I. Lees, Jr. Senior Vice President Accounting & Financial Operations *(Principal Accounting Officer)*

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EXHIBIT 2.9

Confidential

ASSET PURCHASE AGREEMENT

by and between

GLOBAL CROSSING TELECOMMUNICATIONS, INC.

and

MATRIX TELECOM, INC.

Dated as of March 19, 2005

TABLE OF CONTENTS


			Page
ARTICLE I. DEFINITIONS			1

	1.1	Defined Terms	1
	1.2	Other Defined Terms	11
	1.3	Seller’s Knowledge	13

ARTICLE II. PURCHASE AND SALE OF ASSETS			13

	2.1	Transfer of Assets	13
	2.2	Assumption of Liabilities	14
	2.3	Purchase Price	15
	2.4	Allocation of Purchase Price	15
	2.5	Closing Costs; Transfer Taxes and Fees	15
	2.6	Proration and Certain Tax Matters	16
	2.7	Further Assurances and Regulatory Approvals	17

ARTICLE III. CLOSING AND HOLDBACK			24

	3.1	Closing	24
	3.2	Payment of Applicable Closing Cash Purchase Price and Applicable Synthetic Closing Purchase Price; Assumption of Assumed Liabilities	24
	3.3	Deliveries at Closing	25
	3.4	Holdback Amount and Release	26

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER			26

	4.1	Organization	26
	4.2	Authorization	26
	4.3	Absence of Certain Changes or Events	27
	4.4	Title to Purchased Assets	27
	4.5	Financial Information	27
	4.6	No Conflict or Violation; Consents and Approvals	28
	4.7	Leases	28
	4.8	Litigation	29
	4.9	Compliance with Law	29
	4.10	Seller Plans	29
	4.11	Tax Matters	29
	4.12	No Brokers or Finders	30
	4.13	Labor Relations	30
	4.14	Bankruptcy	30
	4.15	Contracts	31
	4.16	Intellectual Property.	32
	4.17	Environmental Matters	32
	4.18	Accounts Receivable	32

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	4.19	Customers and Suppliers	32
	4.20	Insurance	33

ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER			33

	5.1	Organization of Buyer	33
	5.2	Authorization	33
	5.3	Compliance with Applicable Law	33
	5.4	Litigation	34
	5.5	No Conflict or Violation; Consents and Approvals	34
	5.6	No Brokers or Finders	34
	5.7	Financing	34

ARTICLE VI. COVENANTS OF SELLER AND BUYER			34

	6.1	Notification of Certain Matters	34
	6.2	Access by Buyer	35
	6.3	Conduct of Business	35
	6.4	Employee Matters	36
	6.5	Use of Seller’s Name	39
	6.6	Monthly Revenue Reports	40
	6.7	No Additional Representations and Warranties	40
	6.8	Disclaimer of Estimates and Projections	40
	6.9	Confidentiality	41
	6.10	Competing Offers	42
	6.11	Loss of Fixtures and Equipment	42

ARTICLE VII. CONDITIONS TO SELLER’S OBLIGATIONS			43

	7.1	Accuracy	43
	7.2	Covenants	43
	7.3	No Laws or Governmental Orders	43
	7.4	Governmental Consents and Approvals	43
	7.5	Deliveries	44

ARTICLE VIII. CONDITIONS TO BUYER’S OBLIGATIONS			44

	8.1	Accuracy	44
	8.2	Covenants	44
	8.3	No Law or Governmental Orders	44
	8.4	Governmental Consents and Approvals	44
	8.5	Deliveries	45

ARTICLE IX. POST-CLOSING COVENANTS			45

	9.1	Books and Records; Delivery of Purchased Assets	45
	9.2	Survival	45
	9.3	Indemnification	46

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	9.4	Limitations on Indemnification	48
	9.5	Consents to Assignment and Transfer of Certain Rights and Liabilities	49
	9.7	Covenant Not To Compete	51
	9.8	Covenant Not To Solicit	52

ARTICLE X. MISCELLANEOUS			52

	10.1	Termination	52
	10.2	Assignment	53
	10.3	Notices	54
	10.4	Governing Law	55
	10.5	Entire Agreement; Amendments and Waivers	55
	10.6	Counterparts	55
	10.7	Expenses	55
	10.8	Severability	55
	10.9	Titles; Gender; Certain Interpretive Matters	55
	10.10	Publicity	56
	10.11	Exhibits and Schedules; Construction of Certain Provisions	56
	10.12	Cumulative Remedies	56
	10.13	Service of Process, Consent to Jurisdiction	56
	10.14	Time of Essence	56

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EXHIBITS AND SCHEDULES


Exhibit A1	-	Guarantee

Exhibit A2	-	Management Services Agreement

Exhibit B	-	Form of Bill of Sale

Exhibit C	-	Form of Assignment of Contracts

Exhibit D	-	Form of Assumption Agreement

Exhibit E	-	Form of Transition Services Agreement

Exhibit F	-	Form of Carrier Services Agreement

Schedule A	-	Revenue Breakdown

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT, dated as of March 19, 2005, is by and between Global Crossing Telecommunications, Inc., a Michigan corporation (“ Seller ”), and Matrix Telecom, Inc., a Texas corporation (“ Buyer ”).

RECITALS

WHEREAS, Seller, through its business unit known as the Small Business Group (“ SBG ”), is a provider of voice, local and data products to small and medium sized business enterprises;

WHEREAS, Buyer desires to purchase from Seller, and Seller desires to sell to Buyer, certain assets relating to SBG, and Buyer desires to assume from, and Seller desires to transfer to Buyer, certain liabilities relating to SBG, in each case upon the terms and subject to the conditions of this Agreement; and

WHEREAS, concurrently with the execution of this Agreement, Platinum Equity, LLC is guaranteeing the performance of certain payment obligations of Buyer hereunder pursuant to a guarantee in the form attached hereto as Exhibit A1 (the “ Guarantee ”), and Buyer and Seller are entering into a Management Services Agreement attached hereto as Exhibit A2 (the “ MSA ”).

AGREEMENT

NOW THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements of the parties contained herein, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

ARTICLE I.

DEFINITIONS

1.1 Defined Terms . As used herein, the terms below shall have the following meanings. Any of such terms, unless the context otherwise requires, may be used in the singular or plural, depending upon the reference.

“ Action ” means any action, Claim, suit, litigation or other proceeding.

“ affiliate ” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Exchange Act.

“ Aggregate Target Accounts Receivable ” means $9,425,136.

“ Agreement ” means this Asset Purchase Agreement, including all Exhibits and Schedules hereto (including the Disclosure Schedules), as the same may be amended, modified or supplemented from time to time in accordance with its terms.

“ Ancillary Agreements ” means, collectively, (a) the Guarantee, (b) the Bill of Sale, (c) the Assignment of Contracts, (d) the Assumption Agreement, (e) the Transition Services Agreement , (f) the Carrier Services Agreement (g) the MSA and (h) all other instruments, certificates and documents delivered by the parties pursuant to this Agreement, as each may be amended, modified or supplemented from time to time in accordance with its terms.

“ Applicable Cash Purchase Price ” means an amount equal to the product of (x) $40,500,000 minus the MSA Holdback Amount and (y) the percentage equal to a fraction, the numerator of which is equal to the aggregate revenue of SBG attributable to the SBG customers that are being transferred to Buyer at any Applicable Closing Date and the denominator of which is equal to the aggregate revenue of SBG as a whole, both as reflected on Schedule A , subject to adjustment in accordance with Sections 2.8 and 2.9.

“ Applicable Closing Date ” means, (a) with respect to any date of determination, the date that is (i) the third (3) Business Day following receipt by Seller of written notice from Buyer electing to have a Closing; provided , that the parties shall have satisfied or waived all of the conditions precedent to their obligations set forth in Articles VII and VIII (other than the conditions which are not capable of being satisfied until the Applicable Closing Date), except that Buyer may not elect to have a Closing until the parties shall have received all Federal Regulatory Approvals and state Regulatory Approvals to transfer Applicable Purchased Assets accounting for 50% or more of the revenue of SBG as reflected on Schedule A; and, provided , further , that in no event shall Buyer have the right to elect to have more than a total of four Closings under this Agreement and (ii) the third (3) Business Day following the satisfaction or waiver of all the conditions precedent to the obligations of the parties set forth in Articles VII and VIII (other than the conditions which are not capable of being satisfied until the Applicable Closing Date) , and (b) the Holdback Release Date.

“ Applicable Purchased Assets ” means the Purchased Assets that are sold, conveyed, transferred, assigned and delivered to Buyer on the Applicable Closing Date, which shall include all Purchased Assets that have not been transferred as of such date other than Holdback Assets in existence as of such date.

“ Applicable Synthetic Assets ” means those Purchased Assets that would have been Applicable Purchased Assets on an Applicable Synthetic Closing Date if Buyer elected to have an Applicable Closing Date instead of an Applicable Synthetic Closing Date.

“ Applicable Synthetic Cash Purchase Price ” means an amount equal to the product of (x) $40,500,000 minus the MSA Synthetic Holdback Amount and (y) the percentage equal to a fraction, the numerator of which is equal to the aggregate revenue of SBG attributable to the SBG customers that are Applicable Synthetic Assets at any Applicable Synthetic Closing Date and the denominator of which is equal to the aggregate revenue of SBG as a whole, both as reflected on Schedule A .

“ Applicable Synthetic Closing Date ” means, with respect to the Applicable Synthetic Assets, the date on which the parties have satisfied or waived all of the conditions precedent to their obligations set forth in Articles VII and VIII, including under Sections 7.4 and 8.4, but except for those conditions which are not capable of being satisfied until the Applicable

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Closing Date, and Buyer pays to Seller the Applicable Cash Purchase Price but elects not to have Seller transfer the Applicable Synthetic Assets to Buyer and not to assume the Assumed Liabilities relating to the Applicable Purchased Assets relating thereto at such date.

“ Business Day ” means any day other than Saturday, Sunday or any day that is a legal holiday or a day in which banking institutions in New York are authorized by Law or other governmental action to close.

“ Business Employees ” means employees of Seller whose employment primarily relates to SBG.

“ Buyer Employees ” means Business Employees who accept offers of employment from Buyer pursuant to Section 6.4(a) hereof.

“ Claim ” means any claim, demand, cause of action, chose in action, right of recovery or right of set-off of whatever kind or description against any person.

“ COBRA ” shall mean the continuation coverage requirements set forth in Sections 601 et seq. of ERISA and Section 4980B of the Code.

“ Code ” means the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder.

“ Competing Offer ” means any inquiry, proposal or offer relating to a Competing Transaction.

“ Competing Transaction ” means any of the following: a sale, transfer or other disposition of all or substantially all of the assets of SBG in a single transaction or series of related transactions.

“ Confidentiality Agreement ” means that certain confidentiality agreement dated November 29, 2004 by and between an affiliate of Buyer and an affiliate of Seller.

“ Contract ” means all written contracts, subcontracts, agreements, leases, licenses, commitments, loan agreements, mortgages, security agreements, trust indentures, sales and purchase orders, statements of work, and other instruments, arrangements or understandings of any kind, including any amendments or alterations thereto.

“ Disclosure Schedules ” means the disclosure schedules delivered by Seller to Buyer and by Buyer to Seller on the date hereof which, among other things, set forth certain exceptions to the representations and warranties contained in Article IV and Article V hereof. Each reference in this Agreement to any numbered Schedule is a reference to that numbered Schedule in the Disclosure Schedules.

“ Employee Records ” means, with respect to Buyer Employees, copies of all job-related employment documents with the exception of non-work-related medical records or other records the transfer of which to Buyer in connection with the acquisition of the Purchased Assets would be in violation of applicable Law.

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“ Encumbrance ” means any lien, pledge, charge, easement, deed of trust, mortgage, right-of-way, restriction, encumbrance or other security interest of any kind or nature.

“ Environmental Laws ” means all applicable Laws or Governmental Orders relating to pollution, contamination or protection of the environment (including, without limitation, all applicable Laws or Governmental Orders relating to Hazardous Materials in effect as of the date of this Agreement), including but not limited to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Sections 6901 et. seq., the Clean Air Act, 42 U.S.C. Sections 7401 et. seq., the Federal Water Pollution Control Act, 33 U.S.C. Sections 1251 et. seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601 et. seq. and similar state Laws.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Excluded Assets ” means any and all assets, properties, rights or interests not described in the definition of Purchased Assets in this Section 1.1. Without limiting the generality of the foregoing sentence, the term Excluded Assets includes the following assets of Seller as of any Applicable Closing Date relating to or used in connection with SBG, which, notwithstanding any other provision of this Agreement, are expressly excluded from the Purchased Assets and are not to be acquired by Buyer pursuant to this Agreement:

(a) all cash, cash equivalents and bank deposits relating to the operation of SBG and generated by SBG prior to the Applicable Closing Date;

(b) all accounts receivable relating to the operation of SBG that are Holdback Assets as of the Applicable Closing Date;

(c) all SBG customer Contracts that are Holdback Assets as of the Applicable Closing Date;

(d) all of Seller’s rights and remedies pursuant to this Agreement and the Ancillary Agreements, including, without limitation, all Claims in favor of Seller against Buyer, whether arising by counterclaim or otherwise;

(e) the Global Crossing network and network assets;

(f) the name “Global Crossing” or any related or similar trade name, trademark, service mark, domain name or logo;

(g) all assets of Seller or any affiliate thereof that are not used primarily in the operation of SBG;

(h) all Contracts between Seller and its affiliates, except for such agreements specifically identified as Purchased Assets;

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(i) except as set forth in Section 6.4 hereof, all assets held by any Seller Plan;

(j) all refunds, credits or claims for refunds or credits related to Taxes of Seller or any affiliate thereof;

(k) all personnel records that are not Employee Records;

(l) all Claims in favor of Seller arising prior to the Applicable Closing Date, other than those pertaining to Purchased Assets or Assumed Liabilities (except for cross-claims and counterclaims pertaining to Purchased Assets or Assumed Liabilities in the event Seller is defending a Claim pertaining to Purchased Assets or Assumed Liabilities, which cross-claims and counterclaims shall constitute Excluded Assets);

(m) all Claims in favor of Seller against third parties, whether arising by way of counterclaim or otherwise, not relating to an Assumed Liability;

(n) all insurance policies relating to SBG and the Purchased Assets held by Seller and all Claims, credits or rights thereunder, including, without limitation, title insurance;

(o) any of Seller’s or any of Seller’s affiliates’ organizational documents, including certificates of incorporation and minute books;

(p) all Permits held by Seller or its affiliates;

(q) all Intellectual Property of Seller and its affiliates, except as set forth on Schedule 1.1(b) ; and

(r) all access loops used in connection with operations of the SBG.

“ Final Closing Date ” means the date of a Closing on which there are no remaining Holdback Assets or the date of the Holdback Release Date (within the meaning of clause (ii) of the definition thereof) unless Buyer elects to delay the date of such Final Closing Date to a date no later than March 31, 2006.

“ First Applicable Closing Date ” means the first Applicable Closing Date to occur after the date of this Agreement.

“ Fixtures and Equipment ” means all of the equipment (including personal computers, phones, handsets and other computer equipment), furniture, fixtures, furnishings, machinery and other tangible personal property owned by Seller and used primarily in connection with SBG.

“ GAAP ” means United States generally accepted accounting principles.

“ Governmental Authority ” means any court, government (federal, state, local, foreign or multinational) or other regulatory, administrative or governmental agency or authority.

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“ Governmental Order ” means any judgment, decision, consent decree, injunction, ruling, writ or order of or entered by any Governmental Authority that is binding on any person or its property under applicable Law.

“ Hazardous Materials ” means any dangerous, toxic or hazardous pollutant, contaminant, chemical, waste, material or substance as defined in or governed by any federal, state or local law, statute, code, ordinance, regulation, rule or other requirement relating to such substance or otherwise relating to the environment or human health or safety, including without limitation any petroleum and petroleum products, asbestos and asbestos containing products, PCBs, waste, material, substance, pollutant or contaminant that might cause any injury to human health or safety or to the environment or might subject SBG to any imposition of costs or liability under any Environmental Law.

“ Holdback Assets ” means the Purchased Assets that cannot be transferred on any Applicable Closing Date because such transfer would be in violation of applicable Regulatory Law, which shall include the SBG customer Contracts and related accounts receivable for SBG customers located in states for which the parties have not yet received Regulatory Approval to consummate the transactions contemplated herein.

“ Holdback Liabilities ” means the Assumed Liabilities that cannot be transferred on any Applicable Closing Date because such transfer would be in violation of applicable Regulatory Law, which shall include the performance obligations arising under SBG customer Contracts for SBG customers located in states for which the parties have not yet received Regulatory Approval to consummate the transactions contemplated herein.

“ Holdback Release Date ” means the earlier to occur of (i) in the event there shall have occurred the First Applicable Closing Date, the date all the state Regulatory Approvals have been received that are required under applicable Regulatory Law in order to transfer all of the Purchased Assets, including all SBG Contracts and (ii) December 30, 2005; provided that the conditions precedent to the obligations of the parties set forth in Articles VII and VIII have been satisfied or waived (other than conditions which by their terms are not capable of being satisfied until the Applicable Closing Date), provided , further that, in the event there shall have occurred the First Applicable Closing or any Applicable Synthetic Closing Date, for purposes of this clause (ii), the Revenue Threshold in each of Sections 7.4 and 8.4 with respect to the receipt of state Regulatory Approvals shall not apply and shall not be deemed a condition precedent to the parties’ obligations to Close, it being understood and agreed that any Holdback Assets may not be transferred in connection with any Closing.

“ Independent Accounting Firm ” means KPMG or such other independent accounting firm of national reputation mutually appointed by Seller and Buyer.

“ Intellectual Property ” means (a) all patents and patent rights, trademarks and trademark rights, inventions, copyrights and copyright rights, and all pending applications for registration of patents, trademarks and copyrights, all as used or held for use by Seller or any of its affiliates, (b) business names, Internet domain names, brand names, logos, any and all trade secrets, confidential information, inventions, know-how, formulae, process, procedures, research records, market surveys and any and all other intellectual property rights owned or licensed to

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Seller or any of its affiliates and (c) all other computer software programs and subsequent versions thereof, including all source code, object, executable or binary code, objects, comments, screens, user interfaces, report formats, templates, menus, buttons and icons and all files, data, materials, manuals, design notes and other items and documentation related thereto or associated therewith relating to, owned or licensed to Seller or any of its affiliates.

“ Laws ” means any laws, statutes, ordinances, regulations, rules, decrees, executive orders, court decisions and orders of any Governmental Authority.

“ Leased Property ” means the leasehold real property leased by Seller that is located at 2737 South Ridge Road, Green Bay, WI 54304 and 1120 Pittsford-Victor Road, Pittsford, NY 14534.

“ Liabilities ” means any direct or indirect liability, indebtedness, obligation, commitment, expense, claim, deficiency, guaranty or endorsement of or by any person of any type, whether absolute or contingent, matured or unmatured, liquidated or unliquidated, accrued or unaccrued, asserted or unasserted, known or unknown, whenever arising, including all costs and expenses relating thereto, and including, without limitation, those liabilities, indebtedness and obligations arising under any Law, Claim, Action, threatened Action, Governmental Order or any award of any arbitrator of any kind, and those arising under any Contract, commitment or undertaking.

“ Losses ” means, in respect of the indemnification obligations of any party pursuant to this Agreement, any and all actual costs, losses, liabilities, obligations, damages, deficiencies and other reasonable out-of-pocket expenses, including, without limitation, interest, penalties, reasonable attorneys’ fees and all amounts paid in investigation, defense or settlement of Actions relating to Losses.

“ Material Adverse Effect ” any material adverse change in, or material adverse effect on, the Purchased Assets, financial condition or results of operations of SBG, individually or taken as a whole, that was not reasonably foreseeable at the date hereof, provided that any such change or effect arising out of or resulting from (a) any change in economic conditions generally or in the industries in which SBG operates, (b) any continuation of an adverse trend or condition at substantially the same historical rate, (c) any change in Law or GAAP or interpretations thereof, (d) any materially adverse change in or effect on the Purchased Assets which is cured (including by the payment of money) by Seller to the reasonable satisfaction of Buyer before the termination of this Agreement in accordance with its terms, or (e) this Agreement or the transactions contemplated hereby, including, without limitation, the announcement or pendancy thereof, shall not be considered when determining whether a Material Adverse Effect has occurred.

“ MSA Holdback Amount ” means $1,000,000.

“ MSA Synthetic Holdback Amount ” means $8,000,000.

“ ordinary course of business ” or “ ordinary course ” or any similar phrase means the ordinary course of the business conducted by Seller with respect to SBG.

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“ Permits ” means all permits, licenses, franchises and other governmental authorizations, consents and approvals.

“ Permitted Encumbrances ” means (a) Encumbrances imposed by Law, such as carriers’, warehousemen’s, mechanics’, materialmen’s, landlords’ and laborers’ liens incurred in the ordinary course of business and securing obligations which are not yet due or which are being contested in good faith and for which appropriate reserves have been established in accordance with GAAP, consistently applied, (b) Permitted Tax Liens, (c) planning restrictions, easements, licenses, rights of way, declarations, reservations, provisions, covenants, conditions, waivers, irregularities, survey exceptions or other title matters or Encumbrances (and, with respect to leasehold interests, Encumbrances and other obligations incurred, created, assumed or permitted to exist and arising by, through or under a landlord or owner of the leased property, with or without consent of the lessee) which do not materially impair the use (in the manner currently used) or value of the parcel of property to which they relate, (d) zoning, entitlement, conservation restriction and other land use and environmental regulations imposed by Governmental Authorities and (e) any extensions, renewals and replacements of any of the foregoing.

“ Permitted Tax Liens ” means (a) Encumbrances securing the payment of Taxes which are either not delinquent or being contested in good faith by appropriate proceedings and for which appropriate reserves have been established in accordance with GAAP, consistently applied and (b) Encumbrances for current Taxes not yet due and payable.

“ person ” means an individual, a partnership, a corporation, a limited liability company, a trust, an unincorporated organization, a government or any department or agency thereof or any other entity.

“ Primary Closing Date ” means the earlier to occur of (i) the First Applicable Closing Date and (ii) the Holdback Release Date.

“ Purchased Assets ” means all of Seller’s and its affiliates’ right, title and interest in and to the properties, assets and rights primarily related to SBG, including, without limitation:

(a) all assets owned or leased by Seller located at the Leased Properties and used primarily with respect to SBG;

(b) all SBG Contracts;

(c) all Fixtures and Equipment used primarily by the Buyer Employees;

(d) all deposits, credits, security deposits, advance payments, prepaid items and expenses and deferred charges primarily relating to SBG with respect to the Purchased Assets or services to be provided following the Primary Closing Date;

(e) all billed and unbilled accounts receivable relating to the operation of SBG;

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(f) all books, operating records and similar items of Seller relating primarily to the Purchased Assets except to the extent it contains trade secrets of Seller used in Seller’s businesses other than SBG;

(g) all Employee Records;

(h) all Intellectual Property set forth on Schedule 1.1(b); and

(i) all Claims arising prior to the Final Closing Date pertaining to the Purchased Assets or Assumed Liabilities (other than cross claims and counterclaims in the event Seller is defending a Claim pertaining to Excluded Assets or Retained Liabilities, which cross-claims and counterclaims to the extent relating to a particular Claim shall constitute Excluded Assets);

(j) the local Internet dial-up numbers used by SBG under the GRIC Contract and the related access information, to the extent Seller is able to receive the approval of the other parties to the GRIC Contract to transfer such dial-up numbers pursuant hereto; and

(k) the New Lockbox.

Notwithstanding the foregoing, the Purchased Assets shall not include any of the Excluded Assets. For the avoidance of doubt, the parties acknowledge and agree that any services to be provided to Buyer under the Ancillary Agreements and any assets, properties or rights held by Seller and used in connection with the provision of such services do not primarily relate to SBG and are therefore Excluded Assets.

“ Release ” means the spilling, leaking, disposing, discharging, emitting, depositing, ejecting, leaching, escaping or any other release or threatened release, however defined, whether intentional or unintentional, of any Hazardous Material.

“ Representative ” means, with respect to any person, any officer, director, principal, attorney, agent, employee or other authorized representative of such person.

“ Retained Liabilities ” means all Liabilities of Seller relating to SBG other than the Assumed Liabilities and the Holdback Liabilities (in existence as of any given Applicable Closing Date), which, notwithstanding any other provision of this Agreement, will not be assumed by Buyer, including, without limitation:

(a) all Liabilities of Seller relating to Excluded Assets;

(b) all Liabilities of Seller for Taxes other than Liabilities that are apportioned to Buyer pursuant to Section 2.5 or 2.6 hereof;

(c) all payment obligations of Seller for goods and services provided to Seller before the Primary Closing Date;

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(d) subject to Section 6.4 hereof, all Liabilities under Seller Plans, including for wages, pensions, retiree or other benefits, overtime, workers compensation benefits, occupational safety and health liabilities and other similar Liabilities in respect of Business Employees relating to the periods or events occurring before the Primary Closing Date, and all Liabilities with respect to Business Employees who do not become Buyer Employees, whether arising prior to, on or after the Primary Closing Date;

(e) all Liabilities in respect of indebtedness for borrowed money or outstanding checks or drafts;

(f) all Liabilities of any kind of Seller to any affiliate of Seller, or of any affiliate of Seller to Seller or any other affiliate of Seller (except as provided in any of the Ancillary Agreements);

(g) all Liabilities arising out of or resulting from any breach of any SBG Contract by Seller or any of its affiliates on or prior to the Applicable Closing Date on which such SBG Contract is an Applicable Purchased Asset;

(h) all Liabilities to any person for the refund of any amounts paid to Seller or any of its affiliates for any reason;

(i) all litigation related to or arising out of the operation of SBG prior to the Applicable Closing Date, regardless of when such litigation is commenced; and

(j) any other Liability arising with respect to events occurring prior to the Applicable Closing Date.

“ SBG Contracts ” means all Contracts between Seller or any of its affiliates, on the one hand, and a third party, on the other hand, relating primarily to the operation of SBG, including all customer Contracts of SBG and any Contract that generated revenue as reflected on the revenue statements of SBG.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Seller Plans ” means (a) bonus, deferred compensation, pension, retirement, profit-sharing, equity, thrift, savings, employment, time-off, disability insurance, sickness, termination, severance, compensation, life insurance, retiree health benefits, workers’ compensation, medical, health or other plans, agreements, policies or arrangements that cover the Business Employees; (b) any “employee welfare benefit plan,” as defined in Section 3(1) of ERISA or any “employee pension benefit plan,” as defined in Section 3(2) of ERISA, which Seller or any affiliate of Seller sponsors or to which Seller or any affiliate of Seller contributes or is required to contribute, or under which Seller or any affiliate of Seller may incur any Liability, and which covers any Business Employee or former Business Employee, including each multi-employer welfare benefit plan; and (c) any “multi-employer plan,” as defined in Section 4001(a)(3) of ERISA, to which Seller or any affiliate of Seller has contributed or been obligated to contribute within the past six years, and which covers any Business Employee or former Business Employee.

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“ Sublease Agreements ” means the sublease agreements in form and substance reasonably satisfactory to the parties.

“ Subleased Property ” means the real property located at 161 Chestnut Street, Rochester, NY 14604 and 2737 South Ridge Road, Green Bay, WI 54307.

“ Taxes ” means all taxes (including franchise taxes), charges, fees, levies or other assessments imposed by any Taxing Authority and based on or measured solely with respect to net income or profits, including any interest, penalties or additions attributable or imposed with respect thereto, and all taxes, charges, levies, fees or other assessments, including, but not limited to, transfer, gross receipt, sales, use, service, telecommunications, occupation, ad valorem, property, payroll, personal property, excise, severance, premium, stamp, documentary, license, registration, social security, employment, unemployment, disability, environmental (including taxes under Section 59A of the Code), add-on, value-added, withholding (whether payable directly or by withholding and whether or not requiring the filing of a Tax Return therefor), commercial rent and occupancy taxes, and any estimated taxes, deficiency assessments, interest, penalties and additions to tax or additional amounts in connection therewith, imposed by any Taxing Authority.

“ Tax Return ” means any return, report or similar statement or form required to be filed with respect to any Tax (including any attached schedules and related or supporting information), including, without limitation, any information return, claim for refund, amended return or declaration of estimated Tax.

“ Taxing Authority ” means any Governmental Authority responsible for the imposition of any Tax or exercising Tax regulatory authority.

“ Total Cash Purchase Price ” means the sum of all Applicable Cash Purchase Price payments and the MSA Holdback Amount, which shall equal $40,500,000, subject to adjustments made in accordance with Sections 2.8 and 2.9.

1.2 Other Defined Terms . The following terms shall have the meanings defined for such terms in the Sections set forth below:


Term		Section
Accounts Proposed Amount		2.8(e)
Accounts Receivable Closing Statement		2.9(f)
Accounts Receivable Dispute Notice		2.9(d)
Accounts Receivable Proposed Amount		2.9(f)
Accrued Employee Payments		6.4(h)
Actual Accounts Receivable Statement		2.9(c)
Actual Accounts Receivable		2.9(c)
Actual Closing Accounts		2.8(b)
Actual Closing Accounts Receivable		2.8(b)
Actual Closing Accrued Employee Payments		2.8(b)
Actual Statement		2.8(b)

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Term		Section
Adjustment Amount		2.8(a)
Assignment of Contracts		3.3(a)(ii)
Assumed Liabilities		2.2
Assumption Agreement		3.3(b)(iii)
Bill of Sale		3.3(a)(i)
Buyer		Preamble
Buyer Employee		6.4(a)
Buyer Plans		6.4(b)
Buyer Proration Amount		2.6(a)
Buyer Welfare Plans		6.4(c)
Buyer’s 401(k) Plan		6.4(g)
Cap		9.4(a)
Carrier Services Agreement		3.3(a)(iv)
Cash Purchase Price		2.3(a)
Claim Notice		9.3(c)
Closing		3.1
Closing Accounts Receivable Statement		2.8(e)
Closing Date		3.1
Communications Act		2.7(b)
Competing Business		9.7
Confidential Information		6.9(a)
Dispute Notice		2.8(c)
Equity Commitment Letter		5.7(a)
Estimated Accounts Receivable		2.8(a)
Estimated Statement		2.8(a)
FCC		2.7(b)
Final Closing Accounts Receivable Estimated Statement		2.9(b)
Final Closing Adjustment Amount		2.9(b)
Final Closing Estimated Accounts Receivable		2.9(b)
Final Closing Target Accounts Receivable		2.9(b)
Financing		5.7(a)
FMLA		6.4(a)
Guarantee		Recitals
Indemnified Claim		9.3(d)
Independent Accounting Firm		2.8(d)
Leases		4.7
Material Contracts		4.15
New Lockbox		9.6
Noncompete Customers		9.7
Post-Closing Partial Period		2.6(a)
Pre-Closing Partial Period		2.6(a)
Primary Closing Accounts Receivable Estimated Statement		2.9(a)

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Term		Section
Primary Closing Adjustment Amount		2.9(a)
Primary Closing Estimated Accounts Receivable		2.9(a)
Primary Target Accounts Receivable		2.9(a)
Primary True Up Amount		2.9(h)
PUCs		2.7(b)
Purchase Price		2.3
Purchase Price Allocation Schedule		2.4
Regulatory Approvals		2.7(b)
Regulatory Law		2.7(b)
Revenue Threshold		7.4
SBG		Recitals
Seller		Preamble
Seller Marks		6.5(a)
Seller Proration Amount		2.6(a)
Seller Successor		9.7
Seller Welfare Plans		6.4(c)
Supplement Schedules		6.1
Surviving Covenants		9.2(b)
Target Accounts Receivable		2.8(a)
Transfer Fees		2.5
Transition Services Agreement		3.3(a)(iii)
True Up Amount		2.8(g)
USERRA		6.4(a)
WARN Act		6.4(e)

1.3 Seller’s Knowledge . Whenever a phrase herein is qualified by “to the knowledge of Seller” or a similar phrase, it shall mean the actual knowledge, without independent investigation, of the employees of Seller listed on Schedule 1.3 .

ARTICLE II.

PURCHASE AND SALE OF ASSETS

2.1 Transfer of Assets . Upon the terms and subject to the conditions set forth in this Agreement, at the Applicable Closing Date, Seller shall sell, convey, transfer, assign and deliver to Buyer, and Buyer shall purchase and acquire from Seller, all of Seller’s rights, title and interests in and to the Applicable Purchased Assets, free and clear of all Encumbrances other than Permitted Encumbrances. To the extent any of the Applicable Purchased Assets are owned by an affiliate of Seller and are not owned by Seller, Seller shall cause the owner of such Applicable Purchased Assets to either transfer such assets to Seller prior to the Applicable Closing Date or shall cause such affiliate to transfer such assets to Buyer without additional consideration at the Applicable Closing Date, and, upon request, to execute and deliver a bill of sale or other instrument of transfer evidencing such transfer to Buyer. Without limiting the generality of the foregoing, whenever this Agreement requires Seller to take any action, such requirement shall be deemed to include an undertaking on the part of Seller to cause its affiliates to take such action, as necessary and any representation and warranty contained herein shall be deemed to refer to Seller and its other affiliates that conduct SBG, as a collective group.

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2.2 Assumption of Liabilities .

(a) Upon the terms and subject to the conditions set forth in this Agreement, at the Applicable Closing Date, Buyer shall assume, pay, perform and discharge in due course the following Liabilities (the “ Assumed Liabilities ”):

(i) all Liabilities relating to the Applicable Purchased Assets (other than Liabilities caused or incurred by Seller prior to the Applicable Closing Date);

(ii) all Liabilities of Seller and its affiliates incurred after the Applicable Closing Date (other than Liabilities arising from events occurring prior to the Applicable Closing Date), arising with respect to events occurring after the Applicable Closing Date, under all SBG Contracts, other than Holdback Assets in existence as of such Applicable Closing Date, and real and personal property Leases included in the Purchased Assets;

(iii) all Liabilities with respect to Buyer Employees for which Buyer is responsible pursuant to Section 6.4 hereof, and all Liabilities incurred after the Primary Closing Date (other than Liabilities arising from events occurring prior to the Primary Closing Date), with respect to Buyer Employees;

(iv) all Liabilities for Taxes with respect to the Purchased Assets for which Buyer is liable pursuant to Sections 2.5 and 2.6 hereof and all Liabilities with respect to any Tax that may be imposed by any Governmental Authority or Taxing Authority on the ownership, sale, operation or use of the Applicable Purchased Assets after the Applicable Closing Date to the extent arising out of events occurring after the Applicable Closing Date;

(v) all Liabilities that Buyer or any of its affiliates has assumed or agreed to pay for or be responsible for, or will assume or agree to pay for or be responsible for, pursuant to the Ancillary Agreements; and

(vi) without limiting the generality of the foregoing, all Liabilities arising out of the ownership (other than with respect to Liabilities caused or incurred by Seller prior to Closing), sale, operation, use or condition of the Applicable Purchased Assets after the Applicable Closing Date, including all Liabilities in respect of any Actions against Seller or its affiliates that arise out of the ownership (other than Liabilities arising from events occurring prior to the Applicable Closing Date), sale, operation, use or condition of the Applicable Purchased Assets after the Applicable Closing Date, except to the extent Buyer is expressly indemnified for such Liabilities pursuant to the terms of this Agreement.

Notwithstanding the foregoing, the Assumed Liabilities shall not include any of the Retained Liabilities.

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(b) Buyer shall take, or cause to be taken, all actions reasonably necessary to cause the assumption on the Applicable Closing Date by Buyer of the Assumed Liabilities, including, without limitation, the execution and delivery at each such time of the applicable Assumption Agreement.

2.3 Purchase Price . The Purchase Price for the Purchased Assets (the “ Purchase Price ”) shall be an amount equal to (a) the Total Cash Purchase Price plus (b) the assumption of the Assumed Liabilities.

2.4 Allocation of Purchase Price . Seller and Buyer agree that as soon as reasonably practical after the Final Closing Date and prior to the filing of any Tax Return which includes information related to the transactions contemplated by this Agreement, the Purchase Price shall be allocated among the Purchased Assets, the licenses referred to in Section 6.5, and the non-compete referred to in Section 9.7, in accordance with an allocation schedule (the “ Purchase Price Allocation Schedule ”) proposed by Seller and reasonably acceptable to Buyer, which shall be prepared in a manner required by Section 1060 of the Code and other applicable Law and delivered by Seller to Buyer within thirty (30) days after the date that each of the Actual Closing Accounts Receivable is finally determined in accordance with Section 2.9 (it being understood and agreed that Seller shall deliver the Purchase Price Allocation Schedule (or any relevant portion thereof) to Buyer as promptly as practicable, and within a reasonable period of time prior to the date an IRS Form 8594 “Asset Acquisition Statements Under Section 1060” or other applicable Tax filing required to be filed with the applicable Taxing Authorities prior to the Final Closing Date). In connection therewith, Seller and Buyer shall discuss the allocation of the Purchase Price and attempt in good faith to reach agreement with respect thereto. Seller and Buyer may jointly agree to obtain the services of an Independent Accounting Firm to assist the parties in determining the fair value of the Purchased Assets if agreement is not reached with respect to the Purchase Price Allocation Schedule. If such an appraisal is made, both Seller and Buyer agree to accept the Independent Accounting Firm’s determination of the fair value of the Purchased Assets. The parties shall jointly select the Independent Accounting Firm. The cost of the appraisal shall be borne equally by Seller and Buyer. If agreement is reached with respect to the allocation of the Purchase Price, Seller and Buyer shall prepare mutually acceptable and substantially identical IRS Form 8594 “Asset Acquisition Statements Under Section 1060” consistent with the Purchase Price Allocation Schedule which the parties shall use to report the transactions contemplated by this Agreement to the applicable Taxing Authorities. Each of Seller and Buyer agree to provide the other promptly with any other information required to complete IRS Form 8594.

2.5 Closing Costs; Transfer Taxes and Fees . Buyer and Seller shall be responsible for, and share equally the costs of, (a) all sales, use, transfer and other Taxes and fees, if any, imposed by reason of the transfer of the Purchased Assets provided hereunder (and any deficiency, interest or penalty asserted with respect thereto) and (b) all recording, filing and registration fees or other charges in connection with or as a direct result of the transfer of the Purchased Assets (collectively, the “ Transfer Fees ”). Buyer shall file all necessary documentation and Tax Returns with respect to such Transfer Fees and Seller shall reasonably cooperate upon Buyer’s request.

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2.6 Proration and Certain Tax Matters .

(a) Proration . Except as provided in this Agreement (including Section 2.6 hereof), Buyer and Seller agree that the items listed below relating to the Purchased Assets will be prorated as of the Primary Closing Date, with Seller liable to the extent such items relate to (i) any time period ending prior to 12:01 a.m. on the Primary Closing Date and (ii) any time period beginning before the Primary Closing Date and ending after 12:01 a.m. on the Primary Closing Date, but only with respect to the portion of such time period up to and not including 12:01 a.m. on the Primary Closing Date (such portion, a “ Pre-Closing Partial Period ”) (the sum of all such amounts for which Seller is liable, the “ Seller Proration Amount ”), and Buyer liable to the extent such items relate to (i) any time period beginning on or after 12:01 a.m. on the Primary Closing Date and (ii) any time period beginning before the Primary Closing Date and ending after 12:01 a.m. on the Primary Closing Date, but only with respect to the portion of such time period beginning on or after 12:01 a.m. on the Primary Closing Date (such portion, a “ Post-Closing Partial Period ”) (the sum of all such amounts for which Buyer is liable, the “ Buyer Proration Amount ”):

(i) real property Taxes, personal property Taxes and similar ad valorem obligations levied on or with respect to the Purchased Assets;

(ii) other periodic charges and expenses that are unpaid as of the Primary Closing Date.

Notwithstanding the foregoing, Buyer shall not be responsible for any corporate allocations to SBG by Seller or its affiliates.

(b) Calculation . In connection with the prorations referred to in (a) above, all real property Taxes, personal property Taxes and similar ad valorem obligations levied with respect to the Purchased Assets for a taxable period which includes (but does not end on) the Primary Closing Date shall be apportioned between Seller and Buyer based on the number of days of the Pre-Closing Partial Period and the number of days of the Post-Closing Partial Period. In the event that actual figures are not available at the time of calculation, the proration shall be based upon the actual Taxes or fees for the preceding year (or appropriate period) for which actual Taxes or fees are available and such Taxes or fees shall be reprorated and payment attributable to such reproration shall be made within twenty (20) days of the date that the actual final amounts become available. Seller and Buyer agree to furnish each other with such documents and other records as may be reasonably requested in order to confirm all adjustment and proration calculations made pursuant to this Section 2.6.

(c) Tax Returns . With respect to Taxes to be prorated in accordance with this Section 2.6 only, Buyer shall prepare and timely file all Tax Returns required to be filed after the Primary Closing Date with respect to the Purchased Assets, if any, and shall duly and timely pay all Taxes shown to be due on such Tax Returns, subject to prompt reimbursement by Seller in accordance with this Section 2.6. Buyer’s preparation of any such Tax Returns shall be subject to Seller’s approval, which approval shall not be unreasonably withheld, conditioned or delayed. Buyer shall make such Tax Returns available for Seller’s review and approval no later than fifteen (15) Business Days prior to the due date for filing such Tax Return.

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(d) Cooperation . Each of Buyer and Seller shall provide the other with such assistance as may reasonably be requested by the other party in connection with the preparation of any Tax Return, any audit or other examination by any Taxing Authority, or any judicial or administrative proceedings relating to Liability for Taxes with respect to the Purchased Assets. Any information obtained pursuant to this Section 2.6(d) or pursuant to any other Section hereof providing for the sharing of information or review of any Tax Return or other schedule relating to Taxes shall be kept confidential by the parties hereto in accordance with Section 6.9 hereof.

2.7 Further Assurances and Regulatory Approvals .

(a) Upon the terms and subject to the conditions contained herein, each of the parties agrees, both before and after the Final Closing Date, (i) to use its reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things reasonably necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement, including using its reasonable best efforts to satisfy the conditions precedent to each party’s obligations hereunder, (ii) to execute any documents, instruments or conveyances of any kind which may be reasonably necessary or advisable to carry out any of the transactions contemplated hereunder and (iii) to cooperate with each other in connection with the foregoing. In furtherance and not in limitation of the foregoing, each party hereto agrees to file all necessary applications for Regulatory Approvals (as defined below), including pursuant to all Regulatory Laws (as defined below) at the appropriate Governmental Authority with respect to the transactions contemplated hereby as promptly as practical after the date hereof.

(b) Each of Buyer and Seller shall, in connection with the efforts referenced in Section 2.7(a) to obtain all requisite approvals and authorizations for the transactions contemplated by this Agreement under all applicable Regulatory Law (“ Regulatory Approvals ”), use its reasonable best efforts to (i) cooperate in all respects with each other in connection with any filing or submission and in connection with any investigation or other inquiry, including any Action initiated by a private party, (ii) promptly inform the other party of any communication received by such party from, or given by such party to, the Federal Communications Commission (the “ FCC ”), state telecommunications regulatory agencies (“ PUCs ”) or any other Governmental Authority and of any communication received or given in connection with any proceeding by a private party, in each case regarding any of the transactions contemplated hereby and (iii) in each case regarding any of the transactions contemplated hereby, consult with each other in advance of any meeting or conference with the FCC, PUCs or any such other Governmental Authority or, in connection with any Action by a private party, with any other person, and to the extent permitted by the FCC, PUCs or such other applicable Governmental Authority or other person, give the other party the opportunity to attend and participate in such meetings and conferences. With respect to pre-Closing matters (i) Buyer and Seller joint filings shall be initially prepared by Buyer, and Seller shall review and have the right to comment on and approve (which approval shall not be unreasonably

17

withheld, conditioned or delayed) in advance drafts of all communications, petitions, applications and other filings made or prepared by Buyer in connection with obtaining the requisite approvals and authorizations from the appropriate Governmental Authorities for the transactions contemplated hereby and (ii) with respect to filings that are not Buyer and Seller joint filings, each party shall have the right to review, comment on and approve (which approval shall not be unreasonably withheld, conditioned or delayed) in advance drafts of all communications, petitions, applications and other filings made or prepared by the other party in connection with obtaining the requisite approvals and authorizations from the appropriate Governmental Authorities for the transactions contemplated hereby. In furtherance of and not in limitation of the foregoing, the parties agree to file all necessary applications for required consents with PUCs jointly to the extent permitted under applicable Laws and to the extent reasonably necessary under the circumstances. For purposes of this Agreement, “ Regulatory Law ” means the Communications Act of 1934, as amended (the “ Communications Act ”) and all other Laws that are designed or intended to regulate the provision of telecommunications or other services. Except with respect to counsel or other advisors retained by a party, for which such party shall bear its own expenses, the parties shall share equally in all costs, including attorneys fees, filings fees and the like, incurred in seeking and obtaining the necessary Regulatory Approvals.

2.8 Accrued Employee Payments .

(a) Seller shall deliver to Buyer, not later than three (3) Business Days prior to the Primary Closing Date, a good faith estimate of Accrued Employee Payments (the “ Employee Estimated Statement ”) as of the close of business on the day immediately preceding the Primary Closing Date. Such estimate shall be signed by the chief financial officer or other authorized officer of Seller, who shall certify that such estimate was prepared in good faith in accordance with GAAP and from the books and records of Seller. The Applicable Cash Purchase Price payable by Buyer at the Primary Closing Date shall be reduced by an amount equal to the Accrued Employee Payments as set forth on the Employee Estimated Statement.

(b) Seller shall prepare and deliver to Buyer, not later than forty-five (45) days after the Primary Closing Date, a statement (the “ Actual Statement ”) setting forth a calculation of Accrued Employee Payments, both as of the close of business on the day immediately preceding the Primary Closing Date (and as such may be adjusted following resolution of disputes in accordance with this Section 2.8 (the “ Actual Closing Accrued Employee Payments ”)). Such statement shall be signed by the chief financial or other authorized officer of Seller, who shall certify that such statement was prepared in good faith in accordance with GAAP from the books and records of Seller. In connection with the calculation and preparation of the Actual Statement, Buyer shall provide Seller and its independent certified public accountants reasonable access to Buyer Employees and related personnel and all books and records of the Purchased Assets.

(c) If within forty-five (45) days following receipt of the Actual Statement by Buyer, Buyer has not provided Seller written notice of its objection as to the calculation of the Actual Statement (the “ Dispute Notice ”), then the determination of Actual Accrued

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Employee Payments, as calculated by Seller shall be binding and conclusive on the parties. Buyer may waive this forty-five (45) day period by providing written notice to Seller of its acceptance of the Actual Statement. During such period, Seller shall give Buyer reasonable access to the personnel and books and records of Seller relevant to the calculation of Actual Closing Accrued Employee Payments.

(d) If Buyer timely delivers to Seller the Dispute Notice (which notice shall state the basis of Buyer’s objection) within such forty-five (45) day period, Seller and Buyer shall use commercially reasonable efforts for a period of ten (10) days after Seller’s receipt of the Dispute Notice (or such longer period as Seller and Buyer shall mutually agree upon) to resolve any disputes raised by Buyer with respect to the calculation of Actual Closing Accrued Employee Payments, and Buyer and Seller shall provide information to the other party (as reasonably requested) related to the items of disagreement set forth in the Dispute Notice. Buyer and its Representatives shall have all reasonable rights of access to the personnel and books and records of Seller that are primarily related to SBG for such purposes. If at the end of such ten (10) day period, Buyer and Seller fail to resolve the issues outstanding with respect to the Actual Statement, Buyer and Seller shall refer any remaining disagreements to the Independent Accounting Firm.

(e) If issues are submitted to the Independent Accounting Firm for resolution: (i) each of Buyer and Seller shall submit to the Independent Accounting Firm their respective calculation of Actual Closing Accrued Employee Payments (each an “ Accounts Proposed Amount ”) within ten (10) days after the ten (10) day resolution period discussed in Section 2.8(d); (ii) Buyer and Seller shall furnish or cause to be furnished to the Independent Accounting Firm such work papers and other documents and information relating to the disputed issues as the Independent Accounting Firm may reasonably request and are available to that party or its Representatives and shall be afforded the opportunity to present to the Independent Accounting Firm any material relating to the disputed issues and to discuss the issues with the Independent Accounting Firm; and (iii) the Independent Accounting Firm shall make its own determination of the matters in dispute, as set forth in a notice to be delivered to Buyer and Seller (“ Closing Statement ”) within thirty (30) days of the submission to the Independent Accounting Firm of the Accounts Proposed Amounts, which shall be final, binding and conclusive on the parties and which shall not be less than as set forth in the Actual Statement nor greater than as set forth in the Dispute Notice.

(f) The fees and expenses of the Independent Accounting Firm (including any retainers) shall be borne equally by Buyer and Seller. Buyer and Seller shall each bear its own legal, accounting and other fees and expenses of participating in such dispute resolution procedure.

(g) The Total Closing Cash Purchase Price shall be (x) decreased by an amount equal to the difference between the Actual Closing Accrued Employee Payments and the Accrued Employee Payments in the Employee Estimated Statement in the event such difference is a positive number or (y) increased by an amount equal to the absolute value of the difference between the Actual Closing Accrued Employee Payments and the Accrued Employee Payments in the Employee Estimated Statement in the event such difference is a negative number.

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(h) Any adjustment to the Total Closing Cash Purchase Price pursuant to Section 2.8(g) shall be paid by wire transfer of immediately available funds to the account specified by Seller, if Seller is owed payment, or to the account specified by Buyer, if Buyer is owed payment, within three (3) days after (A) the Independent Accounting Firm’s determination of Actual Closing Accrued Employee Payments as set forth on the Closing Statement has become final and binding in accordance with Section 2.8(e) or (B) the date the Actual Statement has become final and binding in accordance with Section 2.8(c).

(i) Any payment made pursuant to this Section 2.8 shall (1) be accompanied by the payment of interest on the amount so paid, from and including the Primary Closing Date but excluding the date of the payment, calculated on a monthly basis at the prime rate of interest published in the Wall Street Journal, Eastern Edition in effect from time to time during the period beginning on the date of the Primary Closing Date and ending on the date of payment and (2) be treated for all purposes as an adjustment to the Purchase Price.

2.9 Accounts Receivable Adjustment .

(a) Seller shall deliver to Buyer, not later than three (3) Business Days prior to the Primary Closing Date, a good faith estimate of (i) SBG billed accounts receivable in respect of the Applicable Purchased Assets transferred as of such Primary Closing Date (the “ Primary Closing Accounts Receivable Estimated Statement ”) as of the close of business on the day immediately preceding the Primary Closing Date. Such estimate shall be signed by the chief financial officer or other authorized officer of Seller, who shall certify that such estimate was prepared in good faith in accordance with GAAP and from the books and records of Seller. If the aggregate SBG billed accounts receivable amount as set forth on the Primary Closing Accounts Receivable Estimated Statement (the “ Primary Closing Estimated Accounts Receivable ”) is equal to or exceeds the product of (x) a percentage equal to a fraction the numerator of which is equal to the aggregate revenue of SBG attributable to the SBG customers that are being transferred on the Primary Closing Date and the denominator of which is equal to the aggregate revenue of SBG as a whole, both as reflected on Schedule A and (y) the Aggregate Target Accounts Receivable (the “ Primary Target Accounts Receivable ”), the Applicable Cash Purchase Price payable by Buyer on the Primary Closing Date shall not be adjusted. If the Primary Target Accounts Receivable exceeds the Primary Closing Estimated Accounts Receivable, the Applicable Cash Purchase Price payable by Buyer on the Primary Closing Date shall be reduced by an amount equal to such excess (the “ Primary Closing Adjustment Amount ”). During the period between the date hereof and the Primary Closing Date, Seller shall bill the customers of SBG only in the ordinary course of business consistent with its past billing practices.

(b) Seller shall deliver to Buyer, not later than three (3) Business Days prior to the Final Closing Date, a good faith estimate of (i) SBG billed accounts receivable in

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respect of the Applicable Purchased Assets transferred during the period from the Primary Closing Date to and including the Final Closing Date ( provided that the Primary Closing Date is not the date of the Final Closing Date) (the “ Final Closing Accounts Receivable Estimated Statement ”) as of the close of business on the day immediately preceding the Final Closing Date. Such estimate shall be signed by the chief financial officer or other authorized officer of Seller, who shall certify that such estimate was prepared in good faith in accordance with GAAP and from the books and records of Seller. If the aggregate SBG billed accounts receivable amount as set forth on the Final Closing Accounts Receivable Estimated Statement (the “ Final Closing Estimated Accounts Receivable ”) is equal to or exceeds the product of (x) a percentage equal to a fraction the numerator of which is equal to the aggregate revenue of SBG attributable to the SBG customers that have been transferred the period from the Primary Closing Date to and including the Final Closing Date or are being transferred on the Final Closing Date and the denominator of which is equal to the aggregate revenue of SBG as a whole, both as reflected on Schedule A and (y) the Aggregate Target Accounts Receivable (the “ Final Closing Target Accounts Receivable ”), the Applicable Cash Purchase Price payable by Buyer on the Final Closing Date shall not be adjusted. If the Final Closing Target Accounts Receivable exceeds the Final Closing Estimated Accounts Receivable, the Applicable Cash Purchase Price payable by Buyer on the Final Closing Date shall be reduced by an amount equal to such excess (the “ Final Closing Adjustment Amount ”). During the period between the date hereof and the Final Closing Date, Seller shall bill the customers of SBG only in the ordinary course of business consistent with its past billing practices.

(c) Seller shall prepare and deliver to Buyer, not later than forty-five (45) days after each of the Primary Closing Date and the Final Closing Date ( provided that the Primary Closing Date is not the date of the Final Closing Date), a statement (each, an “ Actual Accounts Receivable Statement ”) setting forth a calculation of the aggregate SBG billed accounts receivable that constituted Applicable Purchased Assets transferred as of the Primary Closing Date and from the Primary Closing Date to and including the Final Closing Date (as applicable), in each case measured as of the close of business on the day immediately preceding each such Applicable Closing Date (and as such may be adjusted following resolution of disputes in accordance with this Section 2.9, each an “ Actual Accounts Receivable ”). Such statement shall be signed by the chief financial or other authorized officer of Seller, who shall certify that such statement was prepared in good faith in accordance with GAAP from the books and records of Seller. In connection with the calculation and preparation of the Actual Accounts Receivable Statement, Buyer shall provide Seller and its independent certified public accountants reasonable access to Buyer Employees and related personnel and all books and records of the Purchased Assets.

(d) If within forty-five (45) days following receipt of any Actual Accounts Receivable Statement by Buyer, Buyer has not provided Seller written notice of its objection as to the calculation of such Actual Accounts Receivable Statement (each, an “ Accounts Receivable Dispute Notice ”), then the determination of Actual Closing Accounts Receivable, as calculated by Seller shall be binding and conclusive on the parties. Buyer may waive this forty-five (45) day period by providing written notice to

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Seller of its acceptance of the Actual Accounts Receivable Statement. During such period, Seller shall give Buyer reasonable access to the personnel and books and records of Seller relevant to the calculation of Actual Accounts Receivable.

(e) If Buyer timely delivers to Seller an Accounts Receivable Dispute Notice (which notice shall state the basis of Buyer’s objection) within such forty-five (45) day period, Seller and Buyer shall use commercially reasonable efforts for a period of ten (10) days after Seller’s receipt of such Accounts Receivable Dispute Notice (or such longer period as Seller and Buyer shall mutually agree upon) to resolve any disputes raised by Buyer with respect to the calculation of Actual Accounts Receivable, and Buyer and Seller shall provide information to the other party (as reasonably requested) related to the items of disagreement set forth in the Accounts Receivable Dispute Notice. Buyer and its Representatives shall have all reasonable rights of access to the personnel and books and records of Seller that are primarily related to SBG for such purposes. If at the end of such ten (10) day period, Buyer and Seller fail to resolve the issues outstanding with respect to such Actual Accounts Receivable Statement, Buyer and Seller shall refer any remaining disagreements to the Independent Accounting Firm.

(f) If issues are submitted to the Independent Accounting Firm for resolution: (i) each of Buyer and Seller shall submit to the Independent Accounting Firm their respective calculation of Actual Closing Accounts Receivable (each an “ Accounts Receivable Proposed Amount ”) within ten (10) days after the ten (10) day resolution period discussed in Section 2.9(d); (ii) Buyer and Seller shall furnish or cause to be furnished to the Independent Accounting Firm such work papers and other documents and information relating to the disputed issues as the Independent Accounting Firm may reasonably request and are available to that party or its Representatives and shall be afforded the opportunity to present to the Independent Accounting Firm any material relating to the disputed issues and to discuss the issues with the Independent Accounting Firm; and (iii) the Independent Accounting Firm shall make its own determination of the matters in dispute, as set forth in a notice to be delivered to Buyer and Seller (each, an “ Accounts Receivable Closing Statement ”) within thirty (30) days of the submission to the Independent Accounting Firm of the Accounts Receivable Proposed Amounts, which shall be final, binding and conclusive on the parties and which shall not be greater than as set forth in the Actual Accounts Receivable Statement nor less than as set forth in the Accounts Receivable Dispute Notice.

(g) The fees and expenses of the Independent Accounting Firm (including any retainers) shall be borne equally by Buyer and Seller. Buyer and Seller shall each bear its own legal, accounting and other fees and expenses of participating in such dispute resolution procedure.

(h) (i) If the aggregate amount of Total Cash Purchase Price was decreased at the Primary Closing Date pursuant to Section 2.9(a) by the Primary Closing Adjustment Amount and the Primary Closing Target Accounts Receivable exceeds the Actual Accounts Receivable for the Primary Closing Date, then the Total Cash Purchase Price shall be (x) increased by an amount equal to the Primary True Up Amount in the event the Primary True Up Amount is a positive number or (y) decreased by an amount equal to

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the absolute value of the Primary True Up Amount in the event the Primary True Up Amount is a negative number, (ii) if the Total Cash Purchase Price was not adjusted at the Primary Closing Date pursuant to Section 2.9(a) and the Primary Closing Target Accounts Receivable exceeds the Actual Accounts Receivable for the Primary Closing Date, then the Total Cash Purchase Price shall be decreased by the amount of any such excess and (iii) if the Total Cash Purchase Price was not adjusted at the Primary Closing Date pursuant to Section 2.9(a) and the Actual Accounts Receivable for the Primary Closing Date is greater than the Primary Target Accounts Receivable, then there shall be no adjustment to the Total Cash Purchase Price. For the purposes of this Section 2.9, the “ Primary True Up Amount ” means the difference between Actual Closing Accounts Receivable at the Primary Closing Date and the Primary Closing Estimated Accounts Receivable, which may be a positive or negative number.

(i) If the aggregate amount of Total Cash Purchase Price was decreased at the Final Closing Date pursuant to Section 2.9(b) by the Final Closing Adjustment Amount and the Final Closing Target Accounts Receivable exceeds the Actual Accounts Receivable for the period from the Primary Closing Date to and including the Final Closing Date, then the Total Cash Purchase Price shall be (x) increased by an amount equal to the Final True Up Amount in the event the Final True Up Amount is a positive number or (y) decreased by an amount equal to the absolute value of the Final True Up Amount in the event the Final True Up Amount is a negative number, (ii) if the Total Cash Purchase Price was not adjusted at the Final Closing Date pursuant to Section 2.9(b) and the Final Closing Target Accounts Receivable exceeds the Actual Accounts Receivable for the Primary Closing Date, then the Total Cash Purchase Price shall be decreased by the amount of any such excess and (iii) if the Total Cash Purchase Price was not adjusted at the Final Closing Date pursuant to Section 2.9(b) and the Actual Accounts Receivable for the Final Closing Date is greater than the Final Target Accounts Receivable, then there shall be no adjustment to the Total Cash Purchase Price. For the purposes of this Section 2.9, the “ Final True Up Amount ” means the difference between Actual Closing Accounts Receivable at the Final Closing Date and the Final Closing Estimated Accounts Receivable, which may be a positive or negative number.

(j) Any adjustment to the Total Cash Purchase Price pursuant to Section 2.9(g) or (h) shall be paid by wire transfer of immediately available funds to the account specified by Seller, if Seller is owed payment, or to the account specified by Buyer, if Buyer is owed payment, within three (3) days after (A) the Independent Accounting Firm’s determination of Primary Closing Accounts Receivable or Final Closing Accounts Receivable as set forth on each of the respective Actual Accounts Receivable Statements has become final and binding in accordance with Section 2.9(e) or (B) the date the Actual Accounts Receivable Statement has become final and binding in accordance with Section 2.9(c).

(k) Any payment made pursuant to this Section 2.9 shall (1) be accompanied by the payment of interest on the amount so paid, from and including the Applicable Closing Dates but excluding the date of the payment, calculated on a monthly basis at the prime rate of interest published in the Wall Street Journal, Eastern Edition in effect from time to time during the period beginning on the date of the Applicable Closing Dates and ending on the date of payment and (2) be treated for all purposes as an adjustment to the Purchase Price.

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(l) For the purposes of this Section 2.9, no effect will be given to the reversal of any credit since October 31, 2004, other than in respect of direct compensation to SBG customers or the provision of services to SBG customers.

ARTICLE III.

CLOSING AND HOLDBACK

3.1 Closing . Unless this Agreement shall have been terminated in accordance with Section 10.1 hereof, the closing of the purchase and sale of the Purchased Assets, the assumption of the Assumed Liabilities and the consummation of the other transactions contemplated herein, including the Holdback Assets and the Holdback Liabilities to be transferred on each Applicable Closing Date, (in each applicable case, a “ Closing ”) shall be held at 10:00 a.m. New York time at the offices of Latham & Watkins LLP, at 885 Third Avenue, New York, NY 10022, with respect to the transfer of the Applicable Purchased Assets and the assumption of the Assumed Liabilities described in Sections 2.1 and 2.2, on the Applicable Closing Date, unless the parties hereto otherwise agree in writing.

3.2 Payment of Applicable Closing Cash Purchase Price and Applicable Synthetic Closing Purchase Price; Assumption of Assumed Liabilities .

(a) Upon the terms and subject to the satisfaction or waiver of the conditions contained in this Agreement, in consideration of the aforesaid sale, conveyance, transfer, assignment and delivery of the Applicable Purchased Assets, Buyer will, at the Applicable Closing Date, assume the Assumed Liabilities related to the Applicable Purchased Assets and pay Seller the Applicable Cash Purchase Price less any Applicable Synthetic Cash Purchase Price paid to Seller prior to such Applicable Closing Date (if any) by wire transfer of immediately available funds to an account designated in writing by Seller at least three (3) Business Day prior to the Applicable Closing Date; provided that at the Final Closing Date Buyer shall also pay Seller, by wire transfer of immediately available funds to an account designated in writing by Seller at least three (3) Business Days prior to the Final Closing Date, an amount equal to the product of (x) the sum of (i) the MSA Holdback Amount in the event there shall have been an Applicable Closing Date prior to such Final Closing Date and (ii) the MSA Synthetic Holdback Amount in the event there shall have been an Applicable Synthetic Closing Date prior to such Final Closing Date and (y) either (i) 1 in the event there are no remaining Holdback Assets on the Final Closing Date or (ii) a fraction, the numerator of which is equal to the aggregate revenue of SBG attributable to the SBG customers that have been transferred to Buyer up to and including the Final Closing Date and the denominator of which is equal to the aggregate revenue of SBG as a whole, both as reflected on Schedule A . Notwithstanding the foregoing, no Applicable Closing Date shall occur at any time following March 31, 2006.

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(b) Upon the terms of this Agreement, Buyer will, at the Applicable Synthetic Closing Date, pay Seller the Applicable Synthetic Cash Purchase Price by wire transfer of immediately available funds to an account designated in writing by Seller at least three (3) Business Days prior to the Applicable Synthetic Closing Date.

3.3 Deliveries at Closing .

(a) To effect the transactions contemplated hereby, Seller shall, at each Closing (as applicable), deliver to Buyer, or cause to be delivered to Buyer (unless previously delivered):

(i) at each Closing, a bill of sale in substantially the form attached hereto as Exhibit C conveying in the aggregate all of Seller’s owned tangible personal property included in the Purchased Assets transferred to Buyer at such Closing (“ Bill of Sale ”);

(ii) at each Closing, subject to Section 9.5 hereof, one or more assignment documents in substantially the form attached hereto as Exhibit D executed by Seller and assigning the SBG Contracts transferred to Buyer at such Closing (the “ Assignment of Contracts ”);

(iii) at the Primary Closing Date, a Transition Services Agreement in substantially the form attached hereto as Exhibit F executed by Seller (“ Transition Services Agreement ”);

(iv) at the Primary Closing Date, a Carrier Services Agreement in substantially the form attached hereto as Exhibit G executed by Seller (the “ Carrier Services Agreement ”);

(v) at the Primary Closing Date, the Sublease Agreements executed by Seller;

(vi) at the Primary Closing Date, executed counterparts to each of the other Ancillary Agreements; and

(vii) at each Closing, the certificates and other documents required to be delivered at a Closing as described in Article VIII.

(b) To effect the transactions contemplated hereby, Buyer shall, at each Closing (as applicable), deliver to Seller, or cause to be delivered to Seller (unless previously delivered):

(i) at each Closing, the amounts payable to Seller in accordance with Section 3.2 hereof;

(ii) at each Closing, an instrument of assumption in substantially the form attached hereto as Exhibit E , evidencing Buyer’s assumption, in accordance with Section 2.2 hereof, of the Assumed Liabilities (the “ Assumption Agreement ”);

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(iii) at the Primary Closing Date, the Transition Services Agreement executed by Buyer;

(iv) at the Primary Closing Date, the Carrier Services Agreement executed by Buyer;

(v) at the Primary Closing Date, executed counterparts to each of the other Ancillary Agreements; and

(vi) at each Closing, the certificates and other documents required to be delivered at a Closing as described in Article VII.

(c) To the extent that a form of any document to be delivered hereunder is not attached as an Exhibit hereto, such documents shall be in form and substance, and shall be executed and delivered in a manner, reasonably satisfactory to the parties.

3.4 Holdback Amount and Release . The parties acknowledge and agree that deferral of the payment in respect of the Holdback Assets to Seller at a Closing is solely to account for the failure to obtain the applicable Regulatory Approvals relating thereto by the Applicable Closing Date and that such amounts shall not be used to satisfy any other Losses or any other right of set-off, netting, offset, recoupment or similar right whatsoever.

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Buyer as of the date of this Agreement, except as otherwise set forth on the Disclosure Schedules, as follows:

4.1 Organization . Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Michigan, with the requisite corporate power and authority to conduct its business, including SBG, as it is presently being conducted and to own, lease and operate the Purchased Assets. Seller is duly qualified or licensed to do business in each jurisdiction in which the property owned, leased or operated by Seller or the nature of the business conducted by Seller makes such qualification necessary, except in any such jurisdictions where the failure to be duly so qualified or licensed would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect. Schedule 4.1 sets forth a complete and correct list of all jurisdictions in which Seller is required to qualify to conduct business as a foreign corporation based on the operations or assets of SBG.

4.2 Authorization . Except as set forth on Schedule 4.2 , Seller has all requisite corporate power and authority and has taken all corporate action necessary to execute and deliver this Agreement and the Ancillary Agreements to which it is a party, to consummate the transactions contemplated hereby and thereby and to perform its obligations hereunder and thereunder. This Agreement has been and each of the Ancillary Agreements at Closing will be, duly executed and delivered by Seller and, assuming the due authorization, execution and

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delivery of this Agreement and the Ancillary Agreements by Buyer, subject to the receipt of Regulatory Approvals, is a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, except as may be limited by the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally and general equitable principles (whether considered in a proceeding in equity or at Law).

4.3 Absence of Certain Changes or Events . Except as set forth on Schedule 4.3 , since December 31, 2004 there has not been any failure of Seller to carry on diligently the operation of SBG in the ordinary course of business so as to keep available to Buyer the services of the Business Employees and to preserve for Buyer the Purchased Assets and the goodwill of third parties having business dealings with SBG. Notwithstanding the foregoing, except as set forth on Schedule 4.3 , since December 31, 2004 and as the following relates to SBG: (a) no Material Contracts other than customer Contracts have expired or terminated by their terms, or have been amended, rescinded or terminated and there has been no material change to the form customer Contracts provided to SBG customers; (b) Seller has not sold, transferred or disposed of or agreed to sell, transfer or dispose of, any assets related to SBG other than in the ordinary course of business; (c) Seller has not acquired any assets used in connection with SBG except in the ordinary course of business, nor acquired or merged with any other business; (d) no material asset of Seller used in connection with SBG has been destroyed, damaged or otherwise lost (whether or not covered by insurance) in a manner that would have a material and adverse affect on the Purchased Assets; (e) there has been no waiver or amendment of any material right relating to SBG; (f) no increases have been made to the salary or other compensation payable or to become payable to any Business Employee or former employee of SBG and Seller has not obligated itself or its affiliates to pay any bonus or other additional salary or compensation to any Business Employee; (g) there has been no agreement to take any action described above; and (h) there has been no Material Adverse Effect.

4.4 Title to Purchased Assets . Except as set forth on Schedule 4.4 , Seller is the beneficial owner of the Purchased Assets, other than the leased Purchased Assets, and has good and marketable title to such Purchased Assets, or, in the case of leased Purchased Assets, valid and enforceable rights to use such Purchased Assets, free and clear of all Encumbrances except for Permitted Encumbrances. At the Closing, Seller will transfer good and marketable title to or a valid leasehold interest in the Purchased Assets free and clear of all Encumbrances, other than Permitted Encumbrances. The Purchased Assets (a) are owned, licensed, leased or subleased by Seller and not any third party and (b) except for the Excluded Assets (including the assets owned or leased by Seller and used to provide Buyer with services under the Ancillary Agreements), include all of the assets, properties and rights that are used in the conduct of SBG. All the Purchased Assets that are tangible assets are in good operating condition and repair for the purpose in which they are intended, subject only to ordinary wear and tear.

4.5 Financial Information . Set forth on Schedule 4.5 are true and correct copies of revenue statements related to SBG for (a) the fiscal years ended December 31, 2003 and December 31, 2004 and (b) the month ended January 31, 2005, each broken down by product line and the corresponding minutes of usage, as applicable. Such revenue statements have been compiled from the books and records of Seller, have been prepared in accordance with GAAP applied on a consistent basis during the respective periods and fairly present in all material respects the revenue generated by SBG as of their respective dates and for their respective periods covered.

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4.6 No Conflict or Violation; Consents and Approvals .

(a) Except as set forth in Schedule 4.6(a) and other than obtaining Regulatory Approvals, neither the execution, delivery or performance by Seller of this Agreement or the Ancillary Agreements nor the consummation by Seller of the transactions contemplated hereby and thereby will (i) violate or conflict with any provision of the organizational documents of Seller, (ii) in any respect violate, conflict with, or result in or constitute a breach or default under (with the giving of notice or passage of time or both), or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration under, any SBG Contract (x) expiring beyond more than one year from the date hereof and (y) generating more than $50,000 of revenue per year, (iii) violate in any material respect any Law or Governmental Order applicable to Seller and the Purchased Assets, except in the case of clause (ii) above, for such violations, conflicts, breaches, defaults, terminations or accelerations which (x) would not be material and adverse to the Purchased Assets, individually or taken as a whole, or (y) arising solely by virtue of non-assignment or other consent provisions contained in SBG customer Contracts (except for the specific obligation arising pursuant to clauses (ii)(x) and (ii)(y) above) or (iv) result in the creation or imposition of any Encumbrance (other than a Permitted Encumbrance) upon any of the Purchased Assets.

(b) Except as set forth in Schedule 4.6(b) , no consent, approval, Permit order or authorization of, or registration, declaration or filing with, any Governmental Authority, including, but not limited to, the FCC, PUCs and the U.S. Federal Bankruptcy Court sitting in the Southern District of New York, is required by or with respect to Seller or any subsidiary of Seller, as a result of the execution and delivery of this Agreement by the Seller or the consummation of the transactions contemplated hereby, except for those required under or in relation to (i) the Communications Act, and any rules and regulations promulgated by the FCC and (ii) Laws or Orders of any state or local Governmental Authorities, except where failure to obtain such consent, approval or authorization or to make such notice, declaration, filing or registration would not be material and adverse to the Purchased Assets, individually or taken as a whole.

4.7 Leases . (a) Schedule 4.7 sets forth all leases and subleases for the Subleased Property (the “ Leases ”), a portion of which Buyer shall sublease pursuant to the Sublease Agreements; (b) true and complete copies of the Leases and all amendments and agreements relating thereto have been provided to Buyer; and (c) all of the Leases are valid, binding and enforceable against Seller in all respects in accordance with their respective terms, and neither Seller nor, to the knowledge of Seller, the other party to any Lease is in default (or with notice or lapse of time would constitute an event of default by the other party thereto) under such Lease in any respect, except for such defaults that would not be material and adverse to the Purchased Assets, individually or taken as a whole. Seller does not own any real property that is primarily used in SBG.

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4.8 Litigation . Except as set forth on Schedule 4.8 : (a) there is no material Action pending or, to the knowledge of Seller, threatened against or affecting the Purchased Assets or SBG or which could affect the ability of Seller to consummate the sale of the Purchased Assets, (b) Seller is not subject to any material Governmental Order relating to the Purchased Assets or SBG and (c) there are no unsatisfied judgments against the Purchased Assets or SBG.

4.9 Compliance with Law . Seller is in compliance in all material respects with all applicable Laws and Governmental Orders relating to SBG and the Purchased Assets. Without limiting the generality of the foregoing, Seller with respect to SBG (a) is operating in compliance in all material respects with all applicable tariffs and Laws relating to the telecommunications industry, (b) has not received, since December 31, 2003, notice of any material violations of any tariffs or Laws from any Governmental Authority and (c) has not received notice of any material violations of any tariffs or Laws from any Governmental Authority that is unresolved and would be material and adverse to the Purchased Assets, individually or taken as a whole.

4.10 Seller Plans .

(a) Schedule 4.10 sets forth a list of all Seller Plans. No Seller Plan is subject to Title IV of ERISA.

(b) All Seller Plans have been administered in all material respects in compliance with their terms and with the requirements of any applicable Law, including, but not limited to, ERISA and the Code.

(c) Seller does not maintain or contribute to or in any way directly or indirectly have any liabilities (whether contingent or otherwise) with respect to any “multiemployer plan,” within the meaning of Section 3(37) or 4001(a)(3) of ERISA.

(d) Neither Buyer nor Seller will incur any Liability under any severance agreement, deferred compensation agreement, employment agreement, similar agreement, or other Seller Plan solely as a result of the consummation of the transactions contemplated by this Agreement.

(e) All contributions (including all employer contributions and employee salary reduction contributions) required to be made to or with respect to each Seller Plan with respect to the service of the Business Employees as of the Primary Closing Date have been made or have been accrued for in the books and records of Seller.

(f) There are no split dollar life or key man executive insurance agreements for any Business Employees.

4.11 Tax Matters .

(a) Seller has timely filed with the appropriate Taxing Authorities all material Tax Returns required to be filed through the date hereof and will timely file any such Tax Returns required to be filed on or prior to the Final Closing Date. Such Tax Returns are or will be true, complete and correct in all material respects.

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(b) All material Taxes of Seller have been timely paid, or will be timely paid.

(c) There are no Encumbrances for Taxes on or against any of the material Purchased Assets, other than Permitted Tax Liens.

4.12 No Brokers or Finders . Except for The Blackstone Group, the fees of which are the sole responsibility of Seller, Seller has not engaged or made any agreement with any broker, finder or similar agent or any person or firm which will result in the obligation of Buyer to pay any finder’s fee, brokerage fees or commission or similar payment in connection with the transactions contemplated hereby.

4.13 Labor Relations . Seller is not a party to or bound by any collective bargaining agreement with respect to SBG or any Business Employees, and there are not, and have not been in the past two (2) years, any activities or proceedings of any labor union to organize the Business Employees, including any certification question or organizational drive. Seller has not experienced any labor strike, slowdown or other work stoppage with respect to SBG due to labor disagreements and, to the knowledge of Seller, no such action is threatened against Seller with respect to SBG. Except as set forth on Schedule 4.13(i) , (a) there is no material unfair labor practice charge or complaint pending against Seller before the National Labor Relations Board with respect to SBG and (b) there is no material written grievance currently being asserted against Seller with respect to SBG. Schedule 4.13(ii) sets forth a complete and accurate list of the names, current compensation levels (annual base salary, annual target incentive and bonus or commission), adjusted service dates, hire dates, state of residence, status (active or inactive), full-time or part-time, job titles and office/work location of all Business Employees. All Business Employees are employed by Seller. To Seller’s knowledge, no executive, key Business Employee or significant group of Business Employees has provided Seller with formal notice of plans to terminate his or her employment with SBG. Seller is in compliance in all material respects with all applicable Laws respecting employment and employment practices, terms and conditions of employment and wages and hours and occupational safety and health pertaining to the Employees. There are no charges, administrative proceedings or formal complaints of discrimination pending or, to Seller’s knowledge, threatened before the Equal Employment Opportunity Commission or any other Governmental Authority against Seller pertaining to any Business Employee. There are no consultants who provide services primarily related to SBG. To Seller’s knowledge, there is no basis for any such charge, administrative proceeding or complaint. With respect to SBG, Seller has not been required to provide any notice under the Worker Adjustment and Retraining Notification Act of 1988 or any similar Law, and Seller has not taken any action that has caused the termination of any employees by Seller to constitute a “plant closing” or “mass layoff” under any such Law.

4.14 Bankruptcy . Other than the ongoing Chapter 11 proceeding (In re Global Crossing, Ltd., No. 02-40188 (Bankr. S.D.N.Y. filed Jan. 28, 2002)), there is no pending or, to Seller’s knowledge, threatened bankruptcy, insolvency or similar proceeding to which the Purchased Assets are subject, and Seller has not taken any action to authorize the

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commencement of any such proceeding, and no such proceeding is contemplated by Seller. The Agreement is not subject to approval by the Bankruptcy Court relating to the ongoing Chapter 11 proceeding.

4.15 Contracts .

(a) Schedule 4.15(a) sets forth a true and complete list of the following material Contracts relating to SBG (the “ Material Contracts ”): (i) any mortgage, indenture, security agreement, pledge or other Contract relating to the borrowing of money or extension of credit or providing for any Encumbrance (other than Permitted Encumbrances); (ii) any employment, severance, bonus, retention or material consulting Contract; (iii) any guarantees, bonds, letters of credit or similar instruments; (iv) any joint venture, partnership or limited liability company agreements; (v) any non-competition agreement, exclusivity or any other Contract or obligation that purports to limit the manner in which, or the localities in which, SBG may be operated; (vi) any distributor, reseller, sales, license or vendor or similar Contract (other than Contracts among Seller and its affiliates) under which it is anticipated that SBG will in the next twelve months, or has in the prior twelve months, incurred costs or expenses of greater than $20,000; (vii) any customer Contract where SBG has in the twelve (12) months prior to January 31, 2005 earned revenues of greater than $25,000 with respect to such Contract or providing SBG with guaranteed revenues of greater than $25,000 for the fiscal year ended December 31, 2005; (viii) any Contract containing any minimum payment, minimum commitment, minimum guaranty or sole source provider obligations (other than under customer Contracts and Contracts in which Seller or one of its affiliates would receive any such payments, commitments, guaranties or benefits); (ix) any Contract pertaining to SBG Intellectual Property listed on Schedule 1.1(b) ; (x) any intercompany Contracts to which SBG is a party or to which SBG is otherwise bound and that will continue following the Final Closing Date; (xi) any Contract (other than a customer Contract) where the counterparty is a Governmental Authority; (xii) any Contract granting a power of attorney to any person; or (xiii) any other material Contract not in the ordinary course of the business.

(b) Except as set forth on Schedule 4.15(b)(i) , Seller has provided Buyer with or, with respect to Contracts not in hard copy, granted access to complete and accurate copies of all such Material Contracts. Except as set forth on Schedule 4.15(b)(ii) , each Material Contract is valid and binding on Seller and, to the knowledge of Seller, the other parties thereto, and is in full force and effect, and Seller has duly performed in all respects all of its material obligations as required under such Material Contract. To Seller’s knowledge, none of the other parties to any such Material Contract is in breach thereof or default thereunder in any material respect. Without limiting the generality of the foregoing, Seller is in compliance in all material respects with the terms of all such Material Contracts which provide for penalties or similar payments in the event of any failure to meet specified performance levels or the failure to satisfy any reporting requirement (including any obligation to self-report any failure to perform as required by such Material Contract).

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4.16 Intellectual Property .

(a) The Intellectual Property listed on Schedule 1.1(b) is owned by Seller free and clear of all Encumbrances, other than Permitted Encumbrances, or Seller has a valid license to use the same. Buyer will acquire at Closing good and marketable title to, or a valid license to use, the Intellectual Property listed on Schedule 1.1(b) , free and clear of any Encumbrances, other than Permitted Encumbrances.

(b) No written, or to Seller’s knowledge, oral claims have been made to Seller by any person that (i) Seller does not own or have the right to use Intellectual Property listed on Schedule 1.1(b), or (ii) the use of any Intellectual Property listed on Schedule 1.1(b) by SBG infringes upon the intellectual property rights of a third party and, to Seller’s knowledge, there is no valid basis for any such claim.

(c) Except as set forth on Schedule 4.16 , Seller has taken reasonable steps necessary to protect the material trade secrets and other confidential information relating to SBG, and all personnel, including Business Employees, agents, consultants and contractors, who have contributed to or participated in the conception and development of any Intellectual Property listed on Schedule 1.1(b) have (i) been party to a “work-for-hire” arrangement or agreement with Seller in accordance with applicable Law that has accorded Seller full, effective, exclusive and original ownership of all tangible and intangible property arising as a result of such contributions or participation, or (ii) have executed appropriate instruments of assignment in favor of Seller as assignee that have conveyed to Seller full, effective and exclusive ownership of the Intellectual Property listed on Schedule 1.1(b) arising as a result of such contributions or participation.

4.17 Environmental Matters . No Release has occurred at any leased real property included in the Purchased Assets during the time periods in which Seller held such a lease, and Seller has delivered to Buyer accurate and complete copies of all current environmental audits or other studies or reports in its possession relating to any environmental conditions with respect to any leased real property used by SBG.

4.18 Accounts Receivable . Except as set forth on Schedule 4.18 , the accounts receivable included in the Purchased Assets arose from the provision of services or the sale of goods in the ordinary course of business and, to Seller’s knowledge, are valid obligations of the account debtors and are not subject to any counterclaim or set-off that is not fully reserved for by SBG. The accounts receivable aging by invoice for the calendar months of October 2004 and January 2005 attached on Schedule 4.18 is true and correct in all material respects.

4.19 Customers and Suppliers .

(a) Suppliers . Schedule 4.19(a) contains a true and complete list of the twenty largest suppliers of SBG by payables generated for the fiscal year ended December 31, 2004, except for such suppliers that are affiliates of Seller. Since December 31, 2004, no such supplier has terminated its relationship with or adversely curtailed its accommodations or sales to SBG or indicated its intention to terminate such relationship, curtail or materially change its accommodations or sales or the terms thereof.

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(b) Customers . Schedule 4.19(b)(i) sets forth a complete and correct list of the twenty largest customers of SBG by revenues generated for the fiscal year ended December 31, 2004. Except as set forth on Schedule 4.19(b)(ii) , no such customer has communicated in writing an intention to stop, materially decrease the rate of, or materially change the terms on which it does business with SBG, and, to Seller’s knowledge, no circumstances exist that would reasonably be anticipated to give rise to any such event, other than ordinary course attrition of the customer base. There are no material disputes between SBG, on the one hand, and any such customer on the other hand. To the knowledge of Seller, Appendix A to Schedule A attached hereto contains a true and complete list of the SBG customers as of January 31, 2005.

4.20 Insurance . Seller maintains insurance covering or affecting SBG that provides normal and customary levels of insurance coverage for a business of the type conducted by SBG and such insurance is reasonably sufficient to compensate for any material casualty loss that may affect the Purchased Assets. All such policies are valid, outstanding and enforceable and Seller has not agreed to cancel any of such insurance policies prior to the Closing or received written notice of any actual or threatened cancellation of any such insurance policies.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to Seller as follows:

5.1 Organization of Buyer . Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of Texas, with full corporate power and authority to conduct its business as it is presently being conducted and to own and lease its properties and assets.

5.2 Authorization . Buyer has all requisite corporate power and authority, and has taken all corporate action necessary, to execute and deliver this Agreement and the Ancillary Agreements to which it is a party, to consummate the transactions contemplated hereby and thereby and to perform its obligations hereunder and thereunder. This Agreement has been and each of the Ancillary Agreements at Closing will be, duly executed and delivered by Buyer and, assuming the due authorization, execution and delivery of this Agreement and the Ancillary Agreements by Seller, subject to the receipt of Regulatory Approvals, is a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms, except as may be limited by the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally and general equitable principles (whether considered in a proceeding in equity or at Law).

5.3 Compliance with Applicable Law . Buyer conducts its business in compliance with all applicable Laws, except for violations, if any, which would not, individually or in the aggregate, reasonably be expected to materially adversely affect the ability of Buyer to consummate the transactions contemplated hereby.

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5.4 Litigation . There is no material Action pending against Buyer that is reasonably likely to adversely affect Buyer’s performance under this Agreement or the consummation of the transactions contemplated herein.

5.5 No Conflict or Violation; Consents and Approvals .

(a) Neither the execution, delivery or performance by Buyer of this Agreement or the Ancillary Agreements nor the consummation by Buyer of the transactions contemplated hereby and thereby will (i) violate or conflict with any provision of the organizational documents of Buyer, (ii) violate, conflict with, or result in or constitute a breach or default under (with the giving of notice or passage of time or both), or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration under, any of the terms, conditions or provisions of any contract or agreement to which Buyer is a party or by which its assets are bound or (iii) violate any Law or Governmental Order applicable to Buyer, except in the case of each of clauses (ii) and (iii) above, for such violations, breaches, defaults, terminations or accelerations which would not reasonably be expected to materially adversely affect the ability of Buyer to consummate the transactions contemplated hereby.

(b) No material consent, approval, Permit, order or authorization of, or registration, declaration or filing with, any Governmental Authority, including, but not limited to the FCC and PUCs, is required by or with respect to the Buyer or any subsidiary of Buyer as a result of the execution and delivery of this Agreement by the Buyer or the consummation of this transaction, except for those required under or in relation to (a) the Communications Act of 1934, as amended (the “ Communications Act ”), and any rules and regulations promulgated by the FCC and (b) Laws or Orders of any Governmental Authorities.

5.6 No Brokers or Finders . Buyer has not engaged or made any agreement with any broker, finder or similar agent or any person or firm which will result in the obligation of any Seller or any of its affiliates to pay any finder’s fee, brokerage fees or commission or similar payment in connection with the transactions contemplated hereby.

5.7 Financing . At each Closing that shall occur, Buyer will have cash on hand sufficient, in the aggregate, to consummate the transactions contemplated by this Agreement and the Ancillary Agreements and to satisfy all other costs and expenses arising in connection with such Closing.

ARTICLE VI.

COVENANTS OF SELLER AND BUYER

Seller and Buyer each covenant with the other as follows:

6.1 Notification of Certain Matters . Seller shall have the right to deliver to Buyer at the Primary Closing Date a supplement to the Disclosure Schedules (the “ Supplement Schedules ”) containing any matters which, if occurring prior to the date hereof, would have been required to be set forth or described on such Schedules. The Supplement Schedules shall have no effect for purposes of determining the satisfaction of the closing conditions set forth in Article VIII or for determining whether Buyer is entitled to indemnification pursuant to Section 9.3(a) hereof.

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6.2 Access by Buyer . From the date hereof through the Final Closing Date (it being understood and agreed that between the Primary Closing Date and the Final Closing Date the following Section 6.2 shall only apply to the SBG Contracts in the Holdback Assets and the customers related thereto), Seller shall permit (and shall cause its Representatives to permit) Buyer and its Representatives to have access at reasonable times within normal business hours, to all personnel, books, records (including Tax records), contracts and offices of SBG as may be reasonably requested by Buyer. Any information furnished to Buyer or which Buyer receives in exercising its rights pursuant to this Section 6.2 shall be subject to the terms of Section 6.8 hereof; provided , however , that (a) any such investigation shall be conducted in such a manner as not to interfere unreasonably with the operation of SBG or the conduct of Seller’s business, (b) Seller shall not be required to take any action which would constitute a waiver of the attorney-client privilege, (c) Seller need not supply Buyer with any access or information which Seller is under a legal obligation not to supply and (d) Seller shall not be required to provide such information or access to any employee records other than Employee Records (except for such records that cannot be transferred pursuant to this Agreement). Buyer’s access shall include reasonable access to office space and reasonable access to telephones, copiers, facsimile machines and similar office equipment and reasonable access to Seller’s records and information, in each case to the extent relating to SBG, as necessary to facilitate the transition of ownership of the Purchased Assets.

6.3 Conduct of Business . From the date hereof through the Final Closing Date (it being understood and agreed that after the Primary Closing Date, the following Section 6.3 shall only apply to the SBG Contracts and the accounts receivable related thereto in the Holdback Assets, and the customers related thereto), Seller shall, except as contemplated by this Agreement, and except as set forth on Schedule 6.3 , or as consented to by Buyer in writing, (i) operate SBG in the ordinary course of business, (ii) use its commercially reasonable efforts to preserve and maintain its relationships with the customers, suppliers and Business Employees and other persons with which it has significant business relationships with respect to SBG and (iii) use its commercially reasonable efforts to preserve the goodwill and ongoing operations of SBG. Without limiting the generality of the foregoing, Seller shall not, except as contemplated by this Agreement, except as set forth on Schedule 6.3 or as consented to by Buyer in writing, take any of the following actions from the date hereof through the Final Closing Date (it being understood and agreed that after the Primary Closing Date, the following Section 6.3 shall only apply to the SBG Contracts and the accounts receivable related thereto in the Holdback Assets, and the customers related thereto) with respect to SBG, as applicable:

(a) enter into, extend, materially modify, terminate or renew any SBG Contract, except in the ordinary course of business;

(b) sell, assign, transfer, convey, lease, mortgage, pledge or otherwise dispose of or encumber any of the Purchased Assets, or any interests therein, except for dispositions in the ordinary course of business;

(c) fail to comply in any material respect with any Laws applicable to SBG;

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(d) incur any debt or subject any of its assets, properties or rights or any part thereof, to any Encumbrance, other than Permitted Encumbrances;

(e) enter into any new (or amend any existing) Seller Plan, or grant any general increase in the compensation of Business Employees (including any such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment), except as required by any Contract relating to SBG to which a Business Employee is a party;

(f) commit to make any capital expenditure that is in excess of $10,000, individually, or $50,000 in the aggregate, other than in the ordinary course of business;

(g) pay, lend or advance any amount to, or sell, transfer or lease any properties or assets to, any affiliate of Seller;

(h) settle, release or forgive any material Claim or Action relating to the Purchased Assets, or waive any right thereto; or

(i) enter into any agreement, or otherwise become obligated, to do any of the foregoing.

Notwithstanding anything to the contrary contained herein, the parties acknowledge that the assignment of, or transfer of control related to, the Purchased Assets may require Regulatory Approvals and that all final decisions with respect to the Purchased Assets must be taken by Seller until the Regulatory Approvals have been obtained; provided that if Buyer reasonably determines that there exists an event that has resulted in or would be reasonably likely to result in (a) an erosion of the customer base in a manner outside of the ordinary course of business or (b) any other material and adverse impact on the customer base, then Buyer may, at its own expense, take any reasonable action necessary, subject to applicable Law, to counter or prevent such event; provided , further , that such action shall be subject to the prior approval of Seller, which approval will not be unreasonably withheld, conditioned or delayed. The parties do not intend that the foregoing provisions of this Section 6.3 or any other provision in this Agreement shall effect an assignment of, or transfer of control related to, the Purchased Assets prior to obtaining the Regulatory Approvals.

6.4 Employee Matters .

(a) Buyer will make offers of employment prior to the Primary Closing Date (to be effective as of the Primary Closing Date) to the Business Employees listed on Schedule 6.4(a) , giving effect to any additions or subtractions from such list as a result of personnel changes occurring in the ordinary course of business (it being understood that, redeployment of Business Employees to other businesses of Seller or its affiliates outside SBG shall not be deemed to be in the ordinary course of business). Buyer shall offer employment to all of the Business Employees as of the Primary Closing Date on an “at will” basis with the same base salary and annual cash bonus opportunity as in effect for such Business Employee immediately prior to the Primary Closing Date, and otherwise, subject to Buyer’s terms, conditions and policies of employment applicable to similarly situated employees of Buyer; provided , however , that any such Business Employee who

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is absent from work immediately prior to the Primary Closing Date due to injury, disability or approved leave of absence, shall be offered employment hereunder effective upon such Business Employee’s return to active employment, if such Business Employee returns to active employment no later than (i) if on a short-term disability approved leave of absence under the Family and Medical Leave Act of 1993, as amended (“ FMLA ”) or under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“ USERRA ”), the last day on which such Business Employee may return to work under the provisions of Seller’s applicable short-term disability plan, FMLA or USERRA, or (ii) for all other approved leaves of absence including workers’ compensation leave, within six (6) months of the Primary Closing Date. Buyer will communicate offers of employment in accordance with applicable legal requirements and in a form determined by Buyer, which form is reasonably acceptable to Seller. Each Business Employee who accepts Buyer’s offer of employment and commences employment with Buyer shall be referred to as a “ Buyer Employee ” for purposes of this Agreement at the time the Business Employee first commences active employment with Buyer. If a Business Employee rejects an offer of employment, Seller or any affiliate may not offer continued employment to such Business Employee until six (6) months following the Primary Closing Date.

(b) Effective as of the Primary Closing Date (or any later date that a Business Employee becomes a Buyer Employee), Buyer or its designated affiliate shall cause each Buyer Employee who was covered under Seller Plans immediately prior to such date to be covered under employee benefit plans, programs and arrangements maintained or established by Buyer (the “ Buyer Plans ”). The Buyer Plans shall recognize each Buyer Employee’s service with Seller that is recognized under Seller Plans (and prior service with Seller’s predecessors to the extent such prior service is recognized under Seller Plans) for all purposes, including, without limitation, for purposes of any severance plan maintained by the Buyer.

(c) Effective as of the date a Business Employee becomes a Buyer Employee, such Buyer Employee shall cease to be covered by Seller’s employee welfare benefit plans, including plans, programs, policies and arrangements which provide medical and dental coverage, life and accident insurance, disability coverage (collectively, “ Seller Welfare Plans ”). Seller shall retain responsibility for all medical benefit claims incurred by Business Employees prior to the date they become Buyer Employees. For purposes of this subsection, a claim shall be deemed to have been incurred on the date the medical service giving rise to the claim is performed. With respect to the Buyer Employees, effective as of the date a Business Employee becomes a Buyer Employee, Buyer shall cause all applicable Buyer Plans that provide medical or dental coverage, life and accident insurance, and disability or similar coverage (collectively, “ Buyer Welfare Plans ”) to waive pre-existing condition exclusions, evidence of insurability provisions, waiting period requirements or similar provisions to the extent such exclusions, requirements and provisions were waived or satisfied under the applicable Seller Welfare Plan as of the Primary Closing Date. In addition, Buyer shall cause the applicable Buyer Welfare Plans to credit Buyer Employees with amounts credited by Seller under Seller’s health and dental plans toward the satisfaction of annual deductible and out-of-pocket maximums under such Buyer health and dental plans during the calendar year in which a Business Employee becomes a Buyer Employee.

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(d) Seller shall provide to Buyer, at Buyer’s reasonable request, access to Employee Records, as needed for Buyer to comply with this Section 6.4 prior to the Primary Closing Date. Seller and Buyer shall each cooperate with the other and shall provide to the other such documentation, information and assistance as is reasonably necessary to effect the provisions of this Section 6.4. Buyer is solely responsible for the use of Employee Records and other employee information furnished by Seller upon receipt from Seller, and Buyer will indemnify and hold Seller harmless from and against any Losses or Liabilities incurred by Seller as a result of Buyer’s use of such Employee Records or other employee information.

(e) Seller shall be responsible for providing or discharging any and all notifications, benefits and Liabilities to Business Employees and governmental entities under the Worker Adjustment and Retraining Notification Act of 1988 (the “ WARN Act ”) or by any other Law relating to plant closings, mass layoffs or employee separations or severance pay that are first required to be provided or discharged on or prior to the Primary Closing Date, and Buyer shall be responsible for providing any notice required pursuant to WARN with respect to a plant closing, layoff or employee separation or severance pay relating to the Buyer Employees after the Primary Closing Date to the extent resulting from events occurring after the Primary Closing Date. Seller shall retain COBRA responsibility for any Business Employees who do not become Buyer Employees. Buyer shall be responsible for the administration of and shall assume any and all obligations, if any, arising after the Primary Closing Date under COBRA with respect to Buyer Employees and their beneficiaries to the extent resulting from events occurring after the Primary Closing Date.

(f) In the event that Buyer or any of its successors and assigns (i) consolidates with or merges into any person or entity and is not the continuing or surviving corporation or entity in such consolidation or merger or (ii) transfers all or substantially all of its assets or stock to any person, then, in each case, Buyer or its successor or assign, as applicable, shall use reasonable best efforts to make proper provision so that the successors and assigns of Buyer honor the obligations of Buyer set forth in this Section 6.4.

(g) Effective as of the Primary Closing Date, Buyer shall have in effect a defined contribution plan that includes a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code (“ Buyer’s 401(k) Plan ”) providing benefits as of the Primary Closing Date to the Buyer Employees participating in Seller’s Savings Plan as of the Primary Closing Date. Each Buyer Employee who is participating in Seller’s Savings Plan as of the Primary Closing Date shall be eligible to become a participant in Buyer’s 401(k) Plan as of the Primary Closing Date or, if later, the date that the Business Employee becomes a Buyer Employee. Business Employees who become Buyer Employees shall receive credit for all service with Seller and its affiliates for purposes of eligibility and vesting under Buyer’s 401(k) Plan. Effective as of the Primary Closing Date, each Business Employee who, as of the Primary Closing Date,

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becomes a Buyer Employee and was a participant in Seller’s Savings Plan immediately prior to the Primary Closing Date shall be entitled to a distribution of his or her account balance in accordance with the terms of Seller’s Savings Plan as in effect from time to time and applicable Law. Buyer’s 401(k) Plan shall be amended prior to the Primary Closing Date to the extent necessary to provide that it shall accept rollovers, including “direct rollovers” within the meaning of Section 401(a)(31) of the Code, from Seller’s Savings Plan (including the rollover of any outstanding loan notes of Business Employees from Seller’s Savings Plan). Business Employees who are participants in Seller Savings Plan will be 100% vested in their accrued benefits, employer contributions and individual account balances under Seller’s Savings Plan as of the Primary Closing Date (or as of the date such individuals become Buyer Employees hereunder).

(h) Buyer shall assume and be responsible for the aggregate amount of the accrued but unpaid vacation pay and paid time off earned by the Buyer Employees for periods prior to the Primary Closing Date (collectively, the “ Accrued Employee Payments ”).

(i) Seller shall retain Liability for all performance bonus and incentive compensation (including commissions) earned in respect of Business Employees for periods prior to the Primary Closing Date, including any Liability arising under any retention bonuses or Success Bonuses.

(j) Seller shall retain liability for all grants of restricted stock units that were granted to Business Employees prior to the Primary Closing Date, including all employer taxes and costs associated with the exercise or sale of shares acquired thereunder. Seller shall cause each Business Employee who becomes a Buyer Employee to cease participation in any Seller equity compensation plans or programs as of the Primary Closing Date.

6.5 Use of Seller’s Name . Buyer agrees that:

(a) as soon as practicable after the Final Closing Date but in no event later than six (6) months after the Final Closing Date, Buyer shall remove “Global Crossing,” the Global Crossing logo and any other similar mark and any other trademark, design or logo (collectively, the “ Seller Marks ”) previously or currently used by Seller or any of its affiliates from (i) all buildings and signs of SBG and (ii) all invoices, letterhead, advertising and promotional materials, office forms, business cards and packaging materials; provided , however , that Buyer shall not be deemed to have violated this Section 6.5(a) by reason of: (x) the appearance of the Seller Marks in or on any third party’s publications, marketing materials, brochures, equipment or products that were distributed in the ordinary course of business prior to the Final Closing Date, and that generally are in the public domain, or any other similar uses by any such third party over which Buyer has no control or (y) the use by Buyer of the Seller Marks in a non-trademark manner for purposes of conveying to customers or the general public that the name of SBG has changed or the change in ownership or historical origins of SBG or to otherwise transition SBG to Buyer;

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(b) except as may otherwise be set forth herein, in no event shall Buyer or any affiliate of Buyer advertise or hold itself out as Seller or an affiliate of Seller at any time before, on or after the Final Closing Date; and

(c) Seller hereby grants Buyer a limited, royalty free license to continue to use the Seller Marks as provided in this Section 6.5.

6.6 Monthly Revenue Reports . From the date hereof until the Final Closing Date or the earlier termination of this Agreement, as soon as practicable, but in any event within fifteen (15) days after the end of each calendar month, Seller shall cause to be prepared and delivered to Buyer true and correct copies of revenue statements related to SBG substantially in the form and on a basis consistent with the revenue statements set forth on Schedule 4.5 attached hereto (it being understood that after any Applicable Closing Date such revenue statements shall only reflect the revenue attributable to the applicable Holdback Assets), which statements shall set forth the revenue broken down by product line and the corresponding minutes of usage, as applicable. Such revenue statements will be compiled from the books and records of Seller, will be prepared in accordance with GAAP applied on a consistent basis and will fairly present in all material respects the revenue generated by SBG or by the Holdback Assets, as applicable, as of each monthly period covered.

6.7 No Additional Representations and Warranties . Buyer acknowledges that neither Seller nor any other person has made any representation or warranty, express or implied, as to the accuracy or completeness of any information regarding the Purchased Assets, except as expressly set forth in this Agreement, any Ancillary Agreement or any other agreement between the parties, and Buyer further agrees that neither Seller nor any other person shall have or be subject to any Liability to Buyer or any other person resulting from the distribution to Buyer or such person, or Buyer’s or such person’s use of, any such information, including, without limitation, the Confidential Information Memorandum prepared by The Blackstone Group and any information, documents, data or materials made available to Buyer in any data room furnished by Seller, management presentations or other form in expectation of the transactions contemplated by this Agreement. NOTWITHSTANDING ANYTHING CONTAINED IN ARTICLE IV HEREOF OR ANY OTHER PROVISION OF THIS AGREEMENT TO THE CONTRARY, IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT SELLER MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY IN RESPECT OF THE PURCHASED ASSETS OR ANY OTHER MATTER BEYOND THOSE EXPRESSLY GIVEN IN THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED REPRESENTATION OR WARRANTY AS TO THE CONDITION, MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PURCHASED ASSETS, AND ANY SUCH REPRESENTATIONS OR WARRANTIES ARE EXPRESSLY DISCLAIMED. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS AGREEMENT AND THE ANCILLARY AGREEMENTS, IT IS UNDERSTOOD AND AGREED BY BUYER THAT BUYER IS PURCHASING THE PURCHASED ASSETS ON AN “AS IS” AND “WHERE IS” BASIS.

6.8 Disclaimer of Estimates and Projections . In connection with Buyer’s investigation of the Purchased Assets, Buyer has received from or on behalf of Seller certain

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estimates, forecasts, plans and financial projections. Buyer acknowledges that (a) there are uncertainties inherent in making such estimates, forecasts, plans and projections and that Buyer is familiar with such uncertainties, (b) Buyer is taking full responsibility for conducting its own evaluation of the adequacy and accuracy of such estimates, forecasts, plans and projections (including, without limitation, the reasonableness of the assumptions underlying such estimates, forecasts, plans and projections) and (c) Buyer shall have no Claim against Seller or any other person with respect to such estimates, forecasts, plans or projections. Accordingly, Seller is making no representation or warranty with respect to such estimates, forecasts, plans and projections (including, without limitation, such underlying assumptions).

6.9 Confidentiality .

(a) Each party agrees that it shall not use any Confidential Information of any other party or its affiliates for any purpose other than in connection with the consummation of the transactions contemplated by this Agreement or any Ancillary Agreement, whether or not consummated. The receiving party will safeguard the Confidential Information against disclosure by employing the same means to protect the Confidential Information as it uses to protect its own non-public, confidential or proprietary information. Each party further agrees that it shall not divulge any such Confidential Information to any person except (i) to its employees, agents, lenders, financial and other advisors and Representatives to the extent required in connection with the transactions contemplated by this Agreement or any Ancillary Agreement, (ii) to the extent provided in the next sentence, as required to comply with deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process and (iii) as otherwise agreed to by the parties in writing. In the event that a party becomes legally compelled (by deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, such party shall give the other party prompt prior written notice of such requirement so that they may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Section. In the event that such protective order or other remedy is not obtained, or that the party waives compliance with the terms of this Section, the receiving party agrees to provide only that limited portion of the Confidential Information that it is advised by counsel is legally required and to exercise reasonable efforts to obtain assurance that confidential treatment will be accorded such Confidential Information. Each party shall inform its employees, agents, lenders, financial and other advisors and Representatives of the confidential nature of such information and the obligation to keep such information confidential, and shall take such other action as shall be reasonably required to cause such information to be kept confidential. Notwithstanding the foregoing, except as contemplated in (i)–(iii) above, Seller acknowledges that it possesses Confidential Information about SBG, and shall, and shall cause its controlled affiliates to, keep such Confidential Information in strict confidence. For purposes of this Agreement, “ Confidential Information ” shall mean any non-public, confidential or proprietary information, including any information relating to any party or its affiliates’ properties or operations; provided , however , that Confidential Information shall not include any information if:

(i) such information at the time of the disclosure or thereafter is generally available to the public (other than as a result of a disclosure by the receiving party in violation of its confidentiality obligations);

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(ii) such information was available to the receiving party on a non-confidential basis from a source other than the other party; provided that such source was not known by the receiving party to be bound by a confidentiality agreement or a duty of confidentiality that protected the Confidential Information; or

(iii) such information has been independently acquired or developed without use of Confidential Information by the receiving party without violating any of its confidentiality obligations hereunder.

(b) In the event that this Agreement is terminated, if requested by any party, the other party shall promptly return the Confidential Information and all copies or other reproductions thereof, and all letters, notes and reports thereof, and all other materials, derived from the Confidential Information which are in such party’s control. The receiving party agrees to represent in writing to the other party that it has complied with the provisions of this paragraph.

(c) Buyer and Seller agree that nothing in this Agreement shall be interpreted or construed as limiting or otherwise affecting the Confidentiality Agreement, which shall remain in full force and effect.

6.10 Competing Offers . While this Agreement is still in full force and effect, neither Seller nor any of its affiliates shall, nor shall it permit its Representatives to, solicit, initiate, facilitate, or encourage any Competing Offer or any Competing Transaction or negotiate with respect to, discuss, continue or agree to any Competing Offer or any Competing Transaction. Seller shall notify Buyer within forty-eight (48) hours following receipt of any Competing Offer.

6.11 Loss of Fixtures and Equipment . If any Fixtures and Equipment constituting the Purchased Assets are destroyed, lost, stolen or damaged in a manner that would have a material and adverse affect on the operation, in the ordinary course of business, of the Purchased Assets taken as a whole prior to the Primary Closing Date, Seller shall give written notice to Buyer as soon as practicable after, but in any event within three (3) days of discovery of such damage, loss, theft or destruction, including specification of the amount of insurance, if any, directly covering such Fixtures and Equipment. Promptly after discovering any such damage, loss, theft or destruction prior to the Primary Closing Date, Seller shall submit a claim under any applicable Seller insurance policy, to the extent an insured loss, and seek recovery thereunder. Buyer shall be entitled to receive on the Primary Closing Date any proceeds of any such Seller insurance in respect of any such damage, loss, theft or destruction relating to such Fixtures and Equipment. If by the Primary Closing Date Seller has not received any insurance proceeds or such damage, loss, theft or destruction is not covered by insurance, then Seller shall replace such destroyed, lost, stolen or damaged Fixtures and Equipment with a replacement of equal or greater value and quality or shall reimburse Buyer for the cost of purchasing such

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replacement. After the Primary Closing Date and after Buyer has received such replacement, Seller shall be entitled to retain any proceeds of any such Seller insurance in respect of any such damage, loss, theft or destruction.

ARTICLE VII.

CONDITIONS TO SELLER’S OBLIGATIONS

The obligations of Seller to consummate the transactions contemplated by this Agreement are subject to the satisfaction, on or prior to each Applicable Closing Date, of each of the following conditions, any of which may be waived by Seller; provided that Sections 7.1 and 7.2 shall not apply to any Applicable Closing Date following the Primary Closing Date:

7.1 Accuracy . All of the Buyer’s representations and warranties in this Agreement, considered collectively and individually, shall have been accurate (determined without regard to qualifications such as “materiality” and “material adverse affect”), as of the date of this Agreement, except for inaccuracies, if any, which would not, individually or in the aggregate, be reasonably likely to have a material adverse affect on the ability of Buyer to consummate the transactions contemplated hereby.

7.2 Covenants . Buyer shall have performed and satisfied the agreements and covenants required hereby to be performed by it prior to or on the Applicable Closing Date, except for any failure to perform which would not, individually or in the aggregate, be reasonably likely to have a material adverse affect on the ability of Buyer to consummate the transactions contemplated hereby. Buyer shall furnish Seller with a certificate executed by a duly authorized officer of Buyer to the effect that the conditions contemplated by this Section 7.2 are satisfied.

7.3 No Laws or Governmental Orders . No preliminary or permanent injunction or other Governmental Order which prevents the consummation of the sale of the Purchased Assets contemplated hereby shall have been issued and remain in effect (each party agreeing to use its commercially reasonable efforts to have any such injunction or Governmental Order lifted) and no Law shall have been enacted which prohibits the consummation of the sale of the Applicable Purchased Assets.

7.4 Governmental Consents and Approvals . The receipt of all federal government consents and approvals as are necessary or reasonably desirable in order to consummate the sale of the Applicable Purchased Assets and the assumption of the Assumed Liabilities relating to the Applicable Purchased Assets, including, without limitation, all federal Regulatory Approvals; and the receipt of the state Regulatory Approvals that are necessary or reasonably desirable under applicable Regulatory Laws to transfer Applicable Purchased Assets accounting for 85% or more (the “ Revenue Threshold ”) of the revenue of SBG as reflected on Schedule A (it being understood and agreed that for purposes of calculating the Revenue Threshold as of any date of determination pursuant to this Section all aggregate revenue of SBG attributable to the Applicable Purchased Assets that have been transferred to Buyer at any Applicable Closing Date, as reflected on Schedule A , shall be aggregated and considered to be revenue of SBG attributable to the Applicable Purchased Assets transferred as of any such date of determination).

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7.5 Deliveries . Buyer shall have made each of the applicable deliveries described in Section 3.3(b) hereof.

ARTICLE VIII.

CONDITIONS TO BUYER’S OBLIGATIONS

The obligations of Buyer to consummate the transactions contemplated by this Agreement are subject to the satisfaction, on or prior to each Applicable Closing Date, of each of the following conditions, any of which may be waived by Buyer; provided that Sections 8.1 and 8.2 shall not apply to any Applicable Closing Date following the Primary Closing Date:

8.1 Accuracy . All of the Seller’s representations and warranties in this Agreement, considered collectively and individually, shall have been accurate (determined without regard to qualifications such as “materiality,” “materially and adversely” and “Material Adverse Effect”), as of the date of this Agreement (except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been accurate as of such earlier date), except for inaccuracies, if any, which would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect.

8.2 Covenants . Seller shall have performed and satisfied in all material respects the agreements and covenants required hereby to be performed by it prior to or on the Applicable Closing Date, except for any failure to perform which would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect. Seller shall furnish Buyer with a certificate executed by a duly authorized officer of Seller to the effect that the conditions contemplated by this Section 8.2 are satisfied.

8.3 No Law or Governmental Orders . No preliminary or permanent injunction or other Governmental Order which prevents the consummation of the sale of the Purchased Assets contemplated hereby shall have been issued and remain in effect (each party agreeing to use its commercially reasonable efforts to have any such injunction or Governmental Order lifted) and no Law shall have been enacted which prohibits the consummation of the sale of the Applicable Purchased Assets.

8.4 Governmental Consents and Approvals . The receipt of all federal government consents and approvals as are necessary or reasonably desirable in order to consummate the sale of the Applicable Purchased Assets and the assumption of the Assumed Liabilities relating to the Applicable Purchased Assets, including, without limitation, all federal Regulatory Approvals; and the receipt of the state Regulatory Approvals that are necessary or reasonably desirable under applicable Regulatory Laws to transfer Applicable Purchased Assets accounting for the Revenue Threshold of the revenue of SBG as reflected on Schedule A (it being understood and agreed that for purposes of calculating the Revenue Threshold as of any date of determination pursuant to this Section all aggregate revenue of SBG attributable to the Applicable Purchased Assets that have been transferred to Buyer at any Applicable Closing Date, as reflected on Schedule A , shall be aggregated and considered to be revenue of SBG attributable to the Applicable Purchased Assets transferred as of any such date of determination).

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8.5 Deliveries . Seller shall have made each of the applicable deliveries described in Section 3.3(a) hereof.

ARTICLE IX.

POST-CLOSING COVENANTS

9.1 Books and Records; Delivery of Purchased Assets . Each party agrees that it will cooperate with and make available to the other party, during normal business hours, all books and records, information and employees (without substantial disruption of employment) retained and remaining in existence after the Final Closing Date which are necessary or reasonably useful in connection with any Tax inquiry, audit, investigation or dispute, any Action or investigation or any other matter requiring any such books and records, information or employees for any reasonable business purpose. The party requesting any such books and records, information or employees shall bear all of the out-of-pocket costs and expenses (including, without limitation, attorneys’ fees, but excluding reimbursement for salaries and employee benefits) reasonably incurred in connection with providing such books and records, information or employees. All information received pursuant to this Section 9.1 shall be subject to the terms of Section 6.8 hereof.

9.2 Survival .

(a) Each and every representation and warranty contained in this Agreement and the Disclosure Letters shall survive the Final Closing Date solely for purposes of Section 9.2 hereof until eighteen (18) months from the Final Closing Date and then expire, other than: the representations and warranties in Sections 4.10 and 4.11 as to which a Claim may be made at any time until thirty (30) days following the expiration of the applicable statute of limitations including any extension thereof.

(b) Each and every covenant contained in this Agreement and the Ancillary Agreements (other than the covenants contained in Section 6.3, covenants for which a party hereto has brought a Claim, prior to the Final Closing Date, against the other party for a breach of such covenant and the covenants contained in this Agreement and the Ancillary Agreements which by their terms are to be performed by the parties following the Final Closing Date, including any such covenants that are to be performed both before and after the Final Closing Date (collectively, the “ Surviving Covenants ”)) shall expire with, and be terminated and extinguished by, the consummation of the sale of the Purchased Assets and the transfer of the Assumed Liabilities pursuant to this Agreement and shall not survive the Final Closing Date; and none of Seller, Buyer or any Representative or affiliate of any of them shall have any Liability whatsoever with respect to any such covenant. Each Surviving Covenant shall survive the Final Closing Date until, and will expire when, the statute of limitation applicable to such covenant expires. Seller’s indemnification obligations pursuant to Section 9.3(a)(iii) and Buyer’s indemnification obligations pursuant to Section 9.3(b)(iii) shall survive the Final Closing Date in perpetuity. The expiration of the representations, warranties, covenants and indemnification obligations as provided in this Section 9.2 shall not affect the rights of a party in respect of any Claim made by such party in a writing (stating in reasonable detail the basis for such Claim) received by the other party prior to the expiration of the applicable survival period provided herein.

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9.3 Indemnification .

(a) From and after the Applicable Closing Date, Seller shall indemnify, defend and hold harmless Buyer and its affiliates and Representatives from and against any and all Losses actually incurred by Buyer and its affiliates and Representatives in connection with, arising out of or resulting from (i) any breach of any representation or warranty made by Seller in this Agreement and the Ancillary Agreements, (ii) any breach of any Surviving Covenant made by Seller in this Agreement or any Ancillary Agreement and (iii) any Retained Liability.

(b) From and after the Applicable Closing Date, Buyer shall indemnify, defend and hold harmless Seller and its affiliates and Representatives from and against any and all Losses actually incurred by Seller and its affiliates and Representatives in connection with, arising out of or resulting from (i) any breach of any representation or warranty made by Buyer in this Agreement and the Ancillary Agreements, (ii) any breach of any Surviving Covenant made by Buyer in this Agreement or any Ancillary Agreement and (iii) any Assumed Liability.

(c) If a Claim for Losses is to be made by a party entitled to indemnification hereunder against the indemnifying party, the party claiming such indemnification shall give written notice (a “ Claim Notice ”) to the indemnifying party as soon as practicable after the party entitled to indemnification becomes aware of any fact, condition or event which may give rise to Losses for which indemnification may be sought under this Section 9.3; provided , however , if any Action is filed against any party entitled to the benefit of and seeking indemnity hereunder, the applicable Claim Notice shall be given to the indemnifying party as promptly as practicable (and in any event within twenty-five (25) Business Days after the service of the citation or summons). Notwithstanding the foregoing, the failure of any indemnified party to give timely notice hereunder shall not affect rights to indemnification hereunder, except to the extent that the indemnifying party is actually prejudiced by such failure. The parties understand and agree that the failure of the indemnified party to so notify the indemnifying party prior to settling any such Claim (whether by paying the Claim or executing a binding settlement agreement with respect thereto) or the entry of a judgment or issuance of an award with respect to such Claim shall constitute actual prejudice to the indemnifying party’s ability to defend against such Claim. After receiving a Claim Notice relating to a Claim by or against any third party, the indemnifying party shall be entitled, upon written notice to the indemnified party, at its own cost, risk and expense, (i) to take control of the defense and investigation of such lawsuit or action, (ii) to employ and engage attorneys of its own choice to handle and defend the same (unless the named parties to such Action include both the indemnifying party and the indemnified party and the indemnified party has been advised by counsel that there may be one or more legal defenses available to such indemnified party that are different from or additional to those available to the indemnifying party, in which event the indemnified party shall be entitled, at the indemnifying party’s cost, risk and expense, to separate counsel of its own choosing) and

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(iii) to compromise or settle such claim, which compromise or settlement shall be made only with the written consent of the indemnified party, such consent not to be unreasonably conditioned, withheld or delayed (it being understood that the failure of the indemnified party to give such consent shall not be considered unreasonable in respect of any compromise or settlement that contains any admission of violation of Law on the part of the indemnified party, the sole relief of which is anything other than monetary damages or does not include an unconditional release of such indemnified party from all Liabilities arising out of, or that may arise out of, such Claim). In such circumstance, the indemnified party may, at its own cost and expense, participate in the investigation, trial and defense of such lawsuit or action and any appeal arising therefrom (it being understood that the indemnifying party shall control such defense). If the indemnifying party fails to assume the defense of such Claim within fifteen (15) Business Days after receipt of the Claim Notice, the indemnified party against which such Claim has been asserted will have the right to undertake, at the indemnifying party’s cost and expense, the defense, compromise or settlement of such claim on behalf of and for the account and risk of the indemnifying party. Any Claim the defense of which is assumed by an indemnified party shall not be compromised or settled without the written consent of the indemnifying party, such consent not to be unreasonably conditioned, withheld or delayed (it being understood that the failure of the indemnifying party to give such consent shall not be considered unreasonable in respect of any compromise or settlement that contains any admission of violation of Law on the part of the indemnified party, the sole relief of which is anything other than monetary damages, or does not include an unconditional release of such indemnifying party from all Liabilities arising out of, or that may arise out of, such Claim). In the event the indemnified party assumes the defense of a Claim, the indemnified party will keep the indemnifying party reasonably informed of the progress of any such defense, compromise or settlement. The parties shall cooperate in all reasonable respects with each other in the investigation, trial and defense of any Claim for Losses or Action and any appeal arising therefrom. Upon determination of the amount of the Claim whether by agreement or other final adjudication, such amount shall be paid within ten (10) days of its determination.

(d) In the event of payment in full by the indemnifying party to the indemnified party in connection with any Claim (an “ Indemnified Claim ”), other than any claim that would have a material and adverse affect on Buyer’s relationship with any customer of SBG (it being understood that risk of loss of a customer shall be deemed to be material and adverse), the indemnifying party shall be subrogated to and shall stand in the place of the indemnified party as to any events or circumstances in respect of which the indemnified party may have any right or Claim relating to such Indemnified Claim against any claimant or plaintiff asserting such Indemnified Claim or against any other person. The indemnified party shall cooperate with the indemnifying party in a reasonable manner, and at the cost and expense of the indemnifying party, in prosecuting any subrogated right or Claim.

(e) The parties shall cooperate with each other with respect to resolving any Claim or Liability with respect to which one party is obligated to indemnify another party hereunder, including by making commercially reasonable efforts to mitigate or resolve any such Claim or Liability.

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9.4 Limitations on Indemnification .

(a) Notwithstanding anything to the contrary contained in this Agreement or any Ancillary Agreement, (i) no indemnification under Section 9.3(a)(i) hereof shall be made by Seller and no indemnification under Section 9.3(b)(i) hereof shall be made by Buyer, and neither Seller nor Buyer shall have any Liability, respectively, to the other therefore or for any willful breach of a representation contained in this Agreement in the event of termination pursuant to Section 10.1, unless and until the aggregate amount of Losses subject to indemnification pursuant thereto and due the party being indemnified shall exceed $500,000, and once such “threshold amount” is exceeded the indemnifying party shall indemnify the indemnified party, and shall be liable, for the amount of any such Losses, including pursuant to Section 10.1, in excess of $250,000; provided that neither Seller nor Buyer shall have any Liability respectively, to the other for any individual Claim or any Liability arising out of or resulting from a single action, event, occurrence or a set of circumstances, unless such individual Claim or such Liability arising out of or resulting from a single action, event, occurrence or a set of circumstances is greater than $25,000 (it being understood and agreed that any such individual Claim or Liability shall be aggregated solely for purposes of determining when the threshold amount has been exceeded pursuant to this Section 9.4(a) and shall not be aggregated or counted for purposes of determining indemnifiable Losses, including pursuant to Section 10.1), (ii) the aggregate amount required to be paid by Seller pursuant to its indemnification obligations under Section 9.3(a)(i) hereof or by Buyer pursuant to its indemnification obligations under Section 9.3(b)(i) hereof or by Buyer or Seller for any willful breach of a representation contained in this Agreement in the event of termination pursuant to Section 10.1 shall not exceed, subject to clause (iii) below, an amount equal to $5,000,000 (the “ Cap ”), and neither party shall have any Liability to any indemnified party for, and such indemnified parties shall have no right to recover from Seller or Buyer, as the case may be, any amount of Losses which exceeds (and from and after the time such Losses exceed) such amount, (iii) the Cap shall not apply to any indemnifiable Losses pursuant to Sections 9.3(a)(ii), 9.3(a)(iii), 9.3(b)(ii) or 9.3(b)(iii) or to breaches of the representations contained in Sections 4.2, 4.10, 4.11, 4.12, 5.2 and 5.6, and (iv) subject to the foregoing limitations in this Section 9.4(a), neither party shall have any Liability to any indemnified party, including pursuant to Section 10.1, for, and such indemnified parties shall have no right to recover from Seller or Buyer, as the case may be, any amount of Losses which exceeds (and from and after the time such Losses exceed) an aggregate amount equal to the Total Cash Purchase Price.

(b) To the extent that any Losses or Claim therefor which is subject to indemnification hereunder are covered by insurance held by any indemnified party, such indemnified party shall only be entitled to indemnification pursuant to Section 9.3 hereof with respect to the amount of Losses in excess of the net cash proceeds received by such indemnified party pursuant to such insurance. To the extent that, following the receipt of any indemnity payments pursuant to Section 9.3 hereof, the indemnified party obtains any insurance recovery from a third party insurance provider, with respect to such Losses, such indemnified party shall promptly pay over to the indemnifying party (in proportion to their relative payments in respect of the underlying Loss) the amount of the net cash proceeds received by such indemnified party pursuant to such insurance up to,

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but not in excess of, the amount of the indemnity payments made by the indemnifying party pursuant to such Losses. The parties agree that no insurance company shall have any right of subrogation under this Section 9.4(b) and the parties agree that this Section 9.4(b) is not for the benefit of any third party insurance provider.

(c) Except for equitable relief, including, without limitation, injunctive relief or specific performance, to which either party hereto may be entitled, the indemnification provided in this Agreement shall be the sole and exclusive remedy of the parties with respect to this Agreement, the Ancillary Agreements and the transactions contemplated hereby and thereby, and the only legal action that may be asserted by a party entitled to indemnification hereunder against the indemnifying party shall be a contract action to enforce, or to recover Losses under, the indemnification provisions set forth in this Agreement. Notwithstanding the foregoing, prior to the Final Closing Date, each party shall have the right to bring a contract action to enforce, recover Losses from, or seek injunctive or equitable relief from, the other party for breaches of covenants or agreements contained in this Agreement.

(d) Notwithstanding anything to the contrary in this Agreement or any Ancillary Agreement, Losses indemnifiable under this Agreement, including under Section 10.1 (i) shall expressly exclude consequential damages, special or incidental damages, lost profits, diminution in value, punitive damages, exemplary damages, enhanced damages, multiple damages, indirect damages and other penalty or speculative damages, except for Losses arising out of third party Claims which shall be indemnifiable by the indemnifying party for all such damages and (ii) shall not be computed or determined using a multiple of earnings, book value or any similar item which may have been used in arriving at the Purchase Price or which may be reflective of the Purchase Price.

(e) Notwithstanding anything in this Agreement to the contrary, the amounts payable pursuant to indemnification obligations under this Agreement hereof shall be paid without duplication and in no event shall any party hereto be able to recover twice under different provisions of this Agreement for the same Losses, and shall be consistently treated by the parties as an adjustment to the Purchase Price for all Tax purposes, unless otherwise required by Law.

9.5 Consents to Assignment and Transfer of Certain Rights and Liabilities . Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an agreement to assign any SBG Contract or any claim or right or any benefit arising thereunder or resulting therefrom if an attempted assignment or transfer thereof, without the consent of a third party thereto, would constitute a breach or default thereof or give rise to a right of termination or cancellation thereunder, or in any way materially adversely affect the rights of Buyer thereunder. If such consent is not obtained, or if an attempted assignment thereof would be ineffective or would be reasonably likely to materially adversely affect the rights of Buyer thereunder, in the reasonable discretion of Buyer, Seller will, during the period prior to the Final Closing Date, cooperate with Buyer and use its commercially reasonable efforts, at Seller’s expense, to provide to Buyer at the Final Closing Date the benefits under any such SBG Contract or claim or right, including, without limitation, enforcement for the benefit of Buyer of any and

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all rights of Seller against a third party thereto arising out of the breach, default, termination or cancellation by such third party or otherwise or, at Seller’s option, to the maximum extent permitted by Law and such SBG Contract, appoint Buyer to be Seller’s representative and agent with respect to such SBG Contract, as applicable. For a period lasting not more than three (3) months following the Final Closing Date, Buyer and Seller’s internal legal department shall continue to cooperate, at the discretion of Buyer, and use commercially reasonable efforts, at Buyer’s expense (it being understood that Buyer shall not be responsible for Seller’s overhead expenses that would otherwise be incurred in the ordinary course of business), to effect the transfer to Buyer of SBG Contracts providing revenue in excess of $25,000 per year. Prior to the Final Closing Date, Buyer shall have the right to review and comment on written material Seller communications with SBG customers outside the ordinary course of business, where the subject of such communications primarily relates to SBG (it being understood that written communications with SBG customers related to the transactions contemplated hereby, or the consummation thereof, or the transition thereof to Buyer, shall be deemed material written communications outside of the ordinary course of business hereunder). On and after the Final Closing Date, Buyer shall have the right to approve Seller communications with SBG customers outside the ordinary course of business, where the subject of such communications primarily relates to SBG. Buyer shall indemnify, defend and hold harmless Seller from and against any and all Losses incurred by Seller in connection with, arising out of or resulting from any actions taken or not taken by Buyer on or after the Final Closing Date as representative or agent with respect to any SBG Contract or the non-compliance by Buyer on or after the Final Closing Date with any Laws applicable to any such SBG Contract in its capacity as representative or agent of Seller, other than actions taken in compliance with any such SBG Contract or as directed by Seller. Seller shall indemnify, defend and hold harmless Buyer from and against any and all Losses incurred by Buyer in connection with, arising out of or resulting from any actions taken or not taken by Seller on or after the Final Closing Date with respect to any such SBG Contract, or the non-compliance by Seller on or following the Final Closing Date with any Laws applicable to any such SBG Contract, other than actions taken in compliance with any such SBG Contract or as directed by Buyer. To the extent that Buyer is provided the benefits of any SBG Contracts under this Section 9.5, Buyer will perform all of the obligations arising under such SBG Contracts.

9.6 Reimbursement for Post-Closing Collections; Accounts Receivable .

(a) From and after the Final Closing Date, Buyer shall have a right to any monies paid under any Purchased Asset, including any Contract, that has not been transferred to Buyer, Seller shall use its commercially reasonable efforts to collect all such amounts due under such Contracts, at Buyer’s expense (it being understood that Buyer shall not be responsible for Seller’s overhead expenses that would otherwise be incurred in the ordinary course of business) and Buyer shall cooperate with Seller to the extent necessary to collect all such amounts due. From and after the Final Closing Date, Buyer shall also have the right, upon notice to Seller, to (i) seek to collect any such amounts due under any Contracts in its own name, (ii) collect for its own account all receivables and other related items that are included in the Purchased Assets and (iii) to endorse with the name of Seller or any of its affiliates, as necessary, any checks or drafts received with respect to any receivables or such other related items. Seller shall use commercially reasonable efforts to pay over to Buyer within two (2) , and in no event later than five (5), Business Days after receipt thereof any cash or other property received directly or indirectly by it with respect to the receivables and such other related items included in the Purchased Assets.

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(b) Within ten (10) Business Days, Seller shall, at the cost and expense of Buyer, establish a lockbox (the “ New Lockbox ”) at Bank of America dedicated exclusively to SBG and shall provide Buyer with the relevant box numbers relating thereto and the name of each person authorized to draw thereon or to have access thereto and any other information reasonably requested by Buyer related thereto. In accordance with the time periods set forth on Schedule 5 of the Transition Services Agreement, Seller shall promptly redirect all payments with respect to SBG to the New Lockbox.

9.7 Covenant Not To Compete . From and after the Primary Closing Date until three (3) years from the Primary Closing Date, Seller shall not, and shall not permit any of its affiliates (other than persons deemed to control Global Crossing Limited) to (i) own, manage, operate, control, support, financially or otherwise (e.g., by providing consulting services to, or lending a service or trade mark to), or participate in the ownership, management, operation or control of, any business (a “ Competing Business ”) that provides or is directly competing with Buyer to provide voice, local and data products to the customers of Buyer existing as of the date hereof and the SBG customers existing as of the Final Closing Date (collectively, the “ Noncompete Customers ”) in North America, (ii) induce or seek to induce any Noncompete Customer to terminate or materially and adversely change its business relationship with Buyer, (iii) supply customer lists of the Noncompete Customers or other similar information to any third party agent or (iv) provide products or services to any Noncompete Customers obtained through third party agents of Seller or any of its affiliates; provided , however , that (A) the foregoing clauses (i) and (ii) (except to the extent Noncompete Customers are no longer customers of Buyer) shall not prohibit Seller or any of its affiliates from providing the products and services in the manner set forth in the Ancillary Agreements or providing products and services to any person as a wholesaler of telecommunications products and services, such as the type of products and services provided under the Carrier Services Agreement, or maintaining and continuing the current businesses of Seller and its affiliates other than SBG, (B) the foregoing clauses (i), (ii), (iii) and (iv) shall not prohibit Seller or any of its affiliates from owning for passive investment purposes less than five percent (5%) of the outstanding equity of a person engaged in a Competing Business, or from owning the outstanding equity of a person that is currently held as of the date of this Agreement (whether or not such person is engaged in a Competing Business), provided that such person is not controlled by or under common control with Seller or any of its affiliates, (C) the foregoing clauses (i),(ii) (only to the extent such actions are taken in connection with ordinary course competition) and (iv) above shall not prohibit any Seller Successor or its affiliates from engaging in a Competing Business or taking any of such actions, or (D) the foregoing clauses (i), (ii) (except to the extent Noncompete Customers are no longer customers of Buyer) and (iv) above shall not prohibit Seller or any of its affiliates from acquiring (including by way of merger, consolidation, business combination, sale of stock or assets or any similar transaction) a person that engages in a Competing Business or is taking any of such actions if (1) the primary purpose of any such transaction is not the acquisition of a Competing Business and (2) such Competing Business either accounts for 25% or less of the total annual revenues generated by such acquired entity in its most recent fiscal year or is divested within one year from the date it is acquired. For purposes of this Agreement, “ Seller Successor ” means Seller or any of its parent entities following the occurrence of any one of the following: (i) a

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change in the ownership or control of Seller or any of its parent entities effected through a transaction or series of transactions (including by way of merger, consolidation, business combination, sale of stock or similar transaction involving Seller or any of its parent entities) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) (other than Seller or any of its parent entities, or a person that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common control with, Seller) directly or indirectly acquires beneficial ownership of more than 50% of the total combined voting power of the outstanding capital stock of Seller or any of its parent entities, in either case immediately after such transaction or series of transactions; or (ii) the sale, lease, transfer, conveyance or other disposition in one or a series of related transactions, of all or substantially all of the assets of Seller or any of its parent entities, to an unaffiliated person. Seller acknowledges that the remedy at Law for breaches of this Section 9.7 shall be inadequate and that, in addition to any other remedy Buyer may have, it shall be entitled to an injunction restraining any breach or threatened breach, without any bond or other security being required. If any court determines that any part of this Section 9.7 is unenforceable in any respect, then such court may reduce the scope or duration of this Section 9.7 to the extent necessary so that Section 9.7 is enforceable, and this Section 9.7, as so modified, shall then be enforced.

9.8 Covenant Not To Solicit . For a period of two (2) years following the Final Closing Date, Seller shall not, and shall cause its affiliates to not, directly or indirectly encourage, induce, attempt to induce, solicit or attempt to solicit, any Buyer Employee to terminate his or her relationship with Buyer; provided , however , that the foregoing prohibition shall not be deemed to have been violated where a Buyer Employee responds to a general solicitation not specifically directed at such Buyer Employee. Notwithstanding the foregoing, for a period of one (1) year following the Final Closing Date, Seller shall not, and shall cause its affiliates to not, directly or indirectly, employ or otherwise engage in any manner any Buyer Employee listed on Schedule 9.8 attached hereto.

9.9 UCC Filings . At each Applicable Closing Date Seller shall have complied with its obligations under the Indenture dated of December 23, 2004, and the Global Security Agreement dated of December 23, 2004, by and between Seller and the parties thereto in order to have any Encumbrance arising thereunder with respect to the Applicable Purchased Assets removed as of such date, and shall instruct the trustee of the Indenture to obtain UCC termination or release statements, as applicable, in respect of the Applicable Purchased Assets. Seller shall deliver to Buyer within three (3) Business Days of any Applicable Closing Date a copy of the UCC termination filings and other applicable documents created in connection therewith.

ARTICLE X.

MISCELLANEOUS

10.1 Termination .

(a) This Agreement may be terminated at any time prior to the Primary Closing Date:

(i) By mutual written consent of Buyer and Seller;

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(ii) By Buyer or Seller if the Primary Closing Date shall not have occurred on or before December 31, 2005 or such later date as the parties may agree in writing; provided , however , that this provision shall not be available to Buyer if Seller has the right to terminate this Agreement under Section 10.1(a)(iv) hereof, and this provision shall not be available to Seller if Buyer has the right to terminate this Agreement under Section 10.1(a)(iii) hereof;

(iii) By Buyer if there is a material breach of any representation or warranty of Seller set forth in Article IV hereof or any covenant or agreement to be complied with or performed by Seller pursuant to the terms of this Agreement and such breach results or would result in the failure of a condition set forth in Article VIII to be satisfied; provided , however , that Buyer may not terminate this Agreement prior to the Primary Closing Date if Seller has not had an adequate opportunity (and in no event more than thirty (30) days) to cure such failure, provided such failure is capable of being cured, following receipt of written notice from Buyer of such failure; or

(iv) By Seller if there is a material breach of any representation or warranty of Buyer set forth in Article V hereof or of any covenant or agreement to be complied with or performed by Buyer pursuant to the terms of this Agreement and such breach results or would result in the failure of a condition set forth in Article VII to be satisfied; provided , however , that Seller may not terminate this Agreement prior to the Primary Closing Date if Buyer has not had an adequate opportunity (and in no event more than thirty (30) days) to cure such failure, provided such failure is capable of being cured, following receipt of written notice form Seller of such failure.

(b) In the event of termination of this Agreement, no party hereto shall have any Liability under this Agreement to any other party hereto, except for any willful breach of the representations contained in this Agreement or breaches of covenants contained in this Agreement occurring prior to the termination of this Agreement. Upon any such termination, each party will redeliver all documents, work papers and other material of any other party relating to the transactions contemplated hereby, whether so obtained before or after the execution hereof, to the party furnishing the same. The provisions of Sections 6.9, 9.3(c), 9.4, 10.3, 10.4, 10.7, 10.10, 10.13 and 10.14 hereof shall continue in full force and effect notwithstanding any termination of this Agreement or any provision hereof to the contrary.

10.2 Assignment . Neither this Agreement nor any of the rights or obligations hereunder may be assigned by any party (by contract, operation of Law or otherwise) without the prior written consent of the other party; provided , however , that Buyer may, without the consent of Seller and after the Final Closing Date (a) assign all or a part of its rights and obligations under this Agreement to any other person that is a direct or indirect wholly owned subsidiary of Platinum Equity, LLC or of Platinum Equity Capital Partners, L.P., a private equity fund of which an affiliate of Platinum Equity, LLC is the general partner, (b) make a collateral assignment of any rights or benefits hereunder to any lender; or (c) assign any or all of its rights, interests or obligations hereunder in connection with any sale of Buyer or all or substantially all

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of the assets of Buyer; provided , further , in the event of any assignment pursuant to clause (a) above Buyer shall remain primarily liable for its obligations hereunder. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, and no other person shall have any right, benefit or obligation under this Agreement as a third party beneficiary or otherwise; provided , last , that Buyer may, without the consent of Seller and after the Applicable Closing Date, assign any or all of its rights or obligations under an Applicable Purchased Asset or Assumed Liability relating to the Applicable Purchased Assets.

10.3 Notices . All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given (a) when received if personally delivered, (b) when transmitted if transmitted by telecopy, electronic or digital transmission with confirmation of delivery and a follow-up hard copy, (c) the day after it is sent, if sent for next day delivery to a domestic address by recognized overnight delivery service and (d) upon receipt, if sent by certified or registered mail, return receipt requested. In each case any such notice, request, demand or other communication shall be sent to:

If to Seller, to:

Global Crossing Telecommunications, Inc.

1080 Pittsford-Victor Road

Pittsford, New York 14534

Attention: Michael J. Shortley III

Facsimile: (585) 381-6781

with a copy to:

Latham & Watkins LLP

885 Third Avenue

New York, New York 10022

Attention: James Gorton, Esq.

David Allinson, Esq.

Facsimile: (212) 751-4864

If to Buyer, to:

Matrix Telecom, Inc.

c/o Platinum Equity Advisors, LLC

360 North Crescent Drive, South Building

Beverly Hills, California 90210

Attention: Eva M. Kalawski, Esq., General Counsel

Facsimile: 310-712-1863

or to such other place and with such other copies as either party may designate as to itself by written notice to the other.

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10.4 Governing Law . THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED AND THE RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO THE CHOICE OF LAW PROVISIONS OF NEW YORK LAW).

10.5 Entire Agreement; Amendments and Waivers . This Agreement (together with all Exhibits and Schedules hereto) and the Ancillary Agreements constitute the entire agreement among the parties pertaining to the subject matter hereof and thereof and supersede all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties, including, without limitation, the Confidentiality Agreement. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto. No amendment, supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

10.6 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument, binding upon the parties hereto. A facsimile signature page shall be deemed an original, unless an original is required by applicable Law.

10.7 Expenses . Except as otherwise specified in this Agreement, including, without limitation, Section 2.6 hereof, each party hereto shall pay its own legal, accounting, out-of-pocket and other expenses in connection with, arising out of or incident to this Agreement and the Ancillary Agreements and the transactions contemplated hereby and thereby, including, without limitation, any action taken by such party in preparation for carrying this Agreement into effect.

10.8 Severability . In the event that any one or more of the provisions contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by Law, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other such instrument.

10.9 Titles; Gender; Certain Interpretive Matters . The titles, captions or headings of the Articles and Sections herein, and the use of a particular gender, are for convenience of reference only and are not intended to be a part of or to affect or restrict the meaning or interpretation of this Agreement. Any of such terms, unless the context otherwise requires, may be used in the singular or plural, depending upon the reference. All references in this Agreement to Dollars or “$” shall mean U.S. Dollars. Except as otherwise provided or if the context otherwise requires, whenever used in this Agreement, (a) the terms “include” and “including” shall be deemed to be followed by the phrase “without limitation,” (b) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision, (c) any definition of or reference to any Law, agreement, instrument or other document herein will be construed as referring to such Law, agreement, instrument or other document as from time to time amended, supplemented or otherwise modified and (d) any definition of or reference to any statute will be construed as referring also to any rules and regulations promulgated thereunder.

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10.10 Publicity . The parties shall consult with each other and will mutually agree upon any press release or public announcement pertaining to the transactions contemplated herein and shall not issue any such press release or make any such public announcement prior to such consultation and agreement, except as may be required by applicable Law. Notwithstanding the foregoing, after the initial press release or public announcement, each party may issue further press releases, tombstones and similar announcements without the consent of the other party provided that such announcement is consistent with the information contained in the initial press release or public announcement.

10.11 Exhibits and Schedules; Construction of Certain Provisions . The Exhibits and Schedules referred to in this Agreement shall be construed with and be deemed as an integral part of this Agreement to the same extent as if the same had been set forth in their entirety herein. Each disclosure in the Disclosure Schedules shall be deemed to qualify all representations and warranties of Seller or Buyer as applicable, notwithstanding the lack of a specific cross-reference, except to the extent that its applicability to a particular representation, warranty, agreement or condition is not reasonably apparent from the disclosure thereof. It is understood and agreed that the specification of any dollar amount in the representations and warranties contained in this Agreement or the inclusion of any specific item in the Exhibits or Schedules is not intended to imply that such amounts or higher or lower amounts, or the items so included or other items, are or are not material, and no party shall use the fact of the setting of such amounts or the fact of the inclusion of any such item in the Schedules in any dispute or controversy between the parties as to whether any obligation, item or matter not described herein or included in an Exhibit or a Schedule is or is not material for purposes of this Agreement. In addition, matters reflected in the Disclosure Schedules are not necessarily limited to matters required by this Agreement to be reflected in the Disclosure Schedules. Such additional matters are set forth for informational purposes only and do not necessarily include other matters of a similar nature.

10.12 Cumulative Remedies . Subject to Section 9.4(d) hereof, all rights and remedies of either party hereto are cumulative of each other and of every other right or remedy such party may otherwise have at Law or in equity, and the exercise of one or more rights or remedies shall not prejudice or impair the concurrent or subsequent exercise of other rights or remedies.

10.13 Service of Process, Consent to Jurisdiction . Each party hereto irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of this Agreement may be brought in any New York state court or federal court sitting in the Borough of Manhattan, New York, (ii) consents to the exclusive jurisdiction of any such court in any such suit, Action or proceeding and (iii) waives any objection to the laying of venue of any such suit, Action or proceeding in any such court.

10.14 Time of Essence . Time is of the essence in this Agreement. If the date specified in this Agreement for giving any notice or taking any action is not a Business Day (or if the period during which any notice is required to be given or any action taken expires on a date

56

which is not a Business Day), then the date for giving such notice or taking such action (and the expiration date of such period during which notice is required to be given or action taken) shall be the next day which is a Business Day.

[Signature page follows]

57

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on their respective behalf, by their respective officers thereunto duly authorized, all as of the day and year first above written.


Seller:

GLOBAL CROSSING TELECOMMUNICATIONS, INC.

By:		/s/ Glenn Tobias
Name:		Glenn Tobias
Title:		VP Corporate Development

Buyer:

MATRIX TELECOM, INC.

By:		/s/ Eva M. Kalawaski
Name:		Eva M. Kawalski
Title:		Vice President and Secretary

Schedule A

(omitted)

2

EXHIBIT 2.10

CONFIDENTIAL TREATMENT REQUESTED

CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR

WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS

OMITTED AND IS NOTED WITH “[**]”. AN UNREDACTED VERSION OF

THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION.

ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT, dated as of March 25, 2005 (this “ Agreement ”), between Global Crossing Holdings Limited, a Bermuda company (“ Seller ”), and WestCom Corporation, a New York corporation (“ Purchaser ”).

W I T N E S S E T H:

WHEREAS, Seller and its Subsidiaries presently conduct the Business;

WHEREAS, Seller and its Subsidiaries desire to sell, transfer and assign to Purchaser, and Purchaser desires to acquire and assume from Seller and its Subsidiaries, all of the Purchased Assets and Assumed Liabilities, all as more specifically provided herein;

WHEREAS, certain terms used in this Agreement are defined in Section 1.1 ;

WHEREAS, the parties are executing as of the date of this Agreement a Transition Services Agreement, pursuant to which Seller shall provide to Purchaser transitory and other services; and

WHEREAS, the parties and MCI have executed the MCI Assignment and Assumption Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter contained, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1. Certain Definitions .

For purposes of this Agreement, the following terms shall have the meanings specified in this Section 1.1 :

“ Actual Regulatory Prohibition ” means any Order by a Governmental Body of competent jurisdiction (i) restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby or (ii) that imposes upon Purchaser any material Liability or material Business Restriction; in each case relating to the Purchased Assets or the Business.

“ Affiliate ” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person, and the term “ control ” (including the terms “ controlled by ” and “ under common control with ”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities, by contract or otherwise.

“ Ancillary Agreements ” means, collectively, the Seller Documents, the Purchaser Documents, the Transition Services Agreement, the Management Agreement, the Seller Master Services Agreement, the Purchaser Master Services Agreement and the Escrow Agreement.

“ Business ” means the business of providing private line voice services and data transport services on the GCFM network primarily to the financial industry under the brand name “ Global Crossing Trader Voice ” or “ Global Crossing Financial Markets ” (and formerly marketed under the name “ IXnet ”) and the Lucent private line circuits listed in Schedule 1.1(c) as conducted during the 12-month period prior to the date hereof or with such changes outside of the Ordinary Course of Business as may be approved by Purchaser, from and after the date hereof and prior to Closing; provided , however , that the definition of “ Business ” shall not include Frame Relay, ATM or extranet services specific to the securities trading industry under the brand name “ Global Crossing Financial Extranet ” or “ Global Crossing Financial Markets ” and certain corporate administrative functions necessary for the operation of the Business, including accounting, finance, billing, sales, marketing, information technology, engineering, legal support, human resource support, customer support, corporate communications, product development and similar corporate and back-office functions.

“ Business Day ” means any day of the year on which national banking institutions in New York are open to the public for conducting business and are not required or authorized to close.

“ Business Restriction ” means any termination, restriction or impairment of the rights of Purchaser under or with respect to the Purchased Assets (including the Purchased Contracts and Customer Contracts) or the ability of Purchaser to conduct the Business in substantially the same manner as conducted by Seller or its Subsidiaries since January 1, 2004 and, if applicable, prior to any event or determination to which any reference to a “Business Restriction” may relate.

“ CBOT Leases ” means those certain Vendor Equipment Cabinet License Agreements, dated as of October 1, 2001 and October 12, 1999, respectively, by and between Board of Trade of the City of Chicago and International Exchange Networks, Ltd.

“ Change of Control ” means (a) any direct or indirect sale, to any Person not an Affiliate of Global Crossing Limited or any of its Subsidiaries, of all or substantially all of the business and assets of Global Crossing Limited and its Subsidiaries, including any purchase of such business or assets and any acquisition of such business and assets by way of a merger, consolidation or similar transaction or series of related transactions as a result of which those Persons who in the aggregate held a majority of the voting power of Global Crossing Limited immediately prior to such transaction do not hold (either directly or indirectly) more than 50% of the voting power of Global Crossing Limited and such affected Subsidiaries (or the surviving or resulting entity or entities thereof) after giving effect to such transaction, or (b) any transaction which results in the individuals who constituted the board of directors of Global Crossing Limited immediately prior to such transaction ceasing for any reason to constitute at least a majority of the board of directors of Global Crossing Limited immediately after such transaction. However, “Change of Control” shall not mean or include any recapitalization or reorganization of Seller or any of its Subsidiaries.

“ Code ” means the Internal Revenue Code of 1986, as amended.

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“ Contract ” means any concurrence of understanding and intention between two or more Persons with respect to their relative rights and/or obligations or with respect to a thing done or to be done (whether oral or in recorded form and whether or not conditional, executory, express, in writing or meeting the requirements of contract), including any contract, indenture, note, bond, lease or other agreement.

“ Customer Access Circuits ” means those customer local access circuits and tail circuits dedicated exclusively to the Business.

“ Documents ” means all files, documents, instruments, papers, books, reports, records, tapes, microfilms, photographs, letters, budgets, forecasts, ledgers, journals, title policies, customer lists, regulatory filings, operating data and plans, technical documentation (design specifications, functional requirements, operating instructions, logic manuals, flow charts, etc.), user documentation (installation guides, user manuals, training materials, release notes, working papers, etc.), marketing documentation (sales brochures, flyers, pamphlets, web pages, etc.), and other similar materials related exclusively to the Business and the Purchased Assets in each case whether or not in electronic form.

“ Effective Time of the Closing ” shall mean 12:01 AM on the Closing Date.

“ Employee ” means (i) the individuals who are employed by Seller or its Subsidiaries in connection with the Business as of the date hereof, and (ii) individuals who are hired to replace any such individual in respect of the Business after the date hereof and prior to the Closing who receive compensation, benefits and a position of employment that are, in each case, substantially equivalent as those previously provided to such replaced individual.

“ Environmental Law ” means any foreign, federal, state or local statute, regulation, ordinance, or rule of common law currently in effect relating to the protection of human health and safety or the environment or natural resources, including the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601 et seq. ), the Hazardous Materials Transportation Act (49 U.S.C. App. § 1801 et seq. ), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq. ), the Clean Water Act (33 U.S.C. § 1251 et seq. ), the Clean Air Act (42 U.S.C. § 7401 et seq. ) the Toxic Substances Control Act (15 U.S.C. § 2601 et seq. ), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. § 136 et seq. ), and the Occupational Safety and Health Act (29 U.S.C. § 651 et seq. ), and the regulations promulgated pursuant thereto.

“ ERISA ” means the Employment Retirement Income Security Act of 1974, as amended.

“ Escrow Agreement ” means the Escrow Agreement to be entered into by Seller, Purchaser and Escrow Agent on the Closing Date, in the form attached hereto as Exhibit C .

“ Excluded Contracts ” means all Contracts related to the Business other than Customer Contracts and Purchased Contracts, including all leases of real property other than the Transferred Leases.

“ GAAP ” means generally accepted accounting principles in the United States, consistently applied.

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“ Global Crossing Limited ” means Global Crossing Limited, a Bermuda company, and any successors and assigns thereof.

“ Governmental Body ” means any government or governmental or regulatory body thereof, or political subdivision thereof, whether legislative, executive or judicial, whether United States, foreign, federal, state, or local, or any agency, instrumentality or authority thereof, or any court, tribunal, mediator or arbitrator (public or private).

“ Hardware ” means any and all computer and computer-related hardware, including, but not limited to, computers, file servers, facsimile servers, scanners, color printers, laser printers and networks.

“ Hazardous Material ” means any substance, material or waste which is regulated by any Governmental Body including petroleum and its by-products, asbestos, and any material or substance which is defined as a “ hazardous waste ,” “ hazardous substance ,” “ hazardous material ,” “ restricted hazardous waste ,” “ industrial waste ,” “ solid waste ,” “ contaminant ,” “ pollutant ,” “ toxic waste ” or “ toxic substance ” under any provision of Environmental Law.

“ Indebtedness ” of any Person means, without duplication, (i) the principal of and premium (if any) in respect of (A) indebtedness of such Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable; (ii) all obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement (but excluding trade accounts payable and other accrued current liabilities arising in the Ordinary Course of Business); (iii) all obligations of such Person under leases required to be capitalized in accordance with GAAP; (iv) all obligations of such Person for the reimbursement of any obligor on any letter of credit, banker’s acceptance or similar credit transaction; (v) all obligations of the type referred to in clauses (i) through (iv) of any other Person the payment of which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety or otherwise, including guarantees of such obligations; (vi) all obligations of the type referred to in clauses (i) through (v) of other Persons secured by any Lien on any property or asset of such Person (whether or not such obligation is assumed by such Person) and (vii) all prepayment obligations or penalties in respect of any of the foregoing.

“ Intentional Misrepresentation ” means, with respect to any representation made pursuant to this Agreement, an incorrect representation (i) made by any Person that such Person had actual knowledge was incorrect when made or (ii) made by any Person with reckless disregard for the truth, accuracy or correctness thereof.

“ IRS ” means the Internal Revenue Service.

“ Knowledge of Seller ” means the knowledge of those Persons identified on Schedule 1.1(a) after reasonable investigation by such Persons.

“ Law ” means any foreign or United States federal, state, local law, statute, code, ordinance, rule or regulation.

-4-

“ Legal Proceeding ” means any judicial, administrative or arbitral actions, suits or proceedings (public or private) by or before a Governmental Body.

“ Letter of Intent ” means that certain letter of intent, dated September 27, 2004 (as amended through the date hereof), by and among Global Crossing Limited, Purchaser and One Equity Partners LLC.

“ Liability ” means any Indebtedness, liability or obligation (whether direct or indirect, known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, or due or to become due), and including all costs and expenses relating thereto.

“ Lien ” means any lien, encumbrance, pledge, mortgage, assessment, lease, levy, deed of trust, security interest, charge, option, right of first refusal, easement or servitude.

“ Management Agreement ” means the Management Agreement dated as of the date hereof by and between Purchaser and Seller.

“ Material Adverse Effect ” means any circumstance, event, change in, or effect that has or will have (a) a material adverse effect on the Business, assets, Liabilities, financial condition, or results of operations of the Business as of the date of the most recent Financial Data delivered to Purchaser prior to the date of this Agreement, including a material restriction on the ability of Seller or Subsidiaries to continue to conduct the Business in the same manner as conducted by Seller and its Subsidiaries since January 1, 2004, or (b) a material adverse effect on the ability of Seller or its Subsidiaries to consummate the transactions contemplated by this Agreement, in each case other than an effect resulting from an Excluded Matter. “ Excluded Matter ” means any one or more of the following: (i) the effect of any change in the United States or foreign economies or securities or financial markets in general; (ii) the effect of any change that generally affects any industry in which Seller or any of its Subsidiaries operates the Business; (iii) the effect of any changes in applicable Laws or accounting rules; (iv) any effect resulting from any public announcement of this Agreement, or the consummation of the transactions contemplated by this Agreement; or (v) the continuation of the historical decline of revenues or profitability of the Business after the date hereof in a manner similar and at the same rate in proportion to that which has been disclosed to the Purchaser prior to the date hereof.

“ MCI ” means MCI WorldCom Network Services, Inc.

“ MCI Assignment and Assumption Agreement ” means the Assignment and Assumption Agreement by and among Seller, Purchaser and MCI dated as of March 24, 2005.

“ Network Security Agreement ” means that Network Security Agreement dated September 24, 2003 among Global Crossing Ltd., Singapore Technologies Telemeter Pet Ltd., the Federal Bureau of Investigation, the United States Department of Justice, the United States Department of Defense and the United States Department of Homeland Security.

“ Newark Lease ” means that certain Lease Agreement, dated as of March 23, 1999, by and between Market Halsey Urban Renewal, LLC and IX Net, Inc. (as successor in interest to International Exchange Network, Ltd.).

-5-

“ NY PSC ” means the State of New York Public Service Commission.

“ Order ” means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration award of a Governmental Body.

“ Ordinary Course of Business ” means the ordinary and usual course of operations of the Business in compliance with Law.

“ Permits ” means any approvals, authorizations, consents, licenses, permits or certificates of a Governmental Body.

“ Permitted Exceptions ” means (i) all defects, exceptions, restrictions, easements, rights of way and encumbrances disclosed in policies of title insurance; (ii) statutory liens for current Taxes, assessments or other governmental charges not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings provided an appropriate reserve is established therefor; (iii) mechanics’, carriers’, workers’, repairers’ and similar Liens arising or incurred in the Ordinary Course of Business which are being contested in good faith and which are bonded, if required by applicable Law; (iv) zoning, entitlement and other land use and environmental regulations by any Governmental Body provided that such regulations have not been violated; (v) title of a lessor under a capital or operating lease; and (vi) such other imperfections in title, charges, easements, restrictions and encumbrances which would not result in a Material Adverse Effect; provided that, in the case of Permitted Exceptions described in the foregoing clauses (i) through (vi), Purchaser would still obtain the benefit of the underlying asset or Contract, except that Purchaser shall take assignment of the Transferred Leases in accordance with the terms hereof subject to the rights of the lessor of such real property as set forth in the currently effective lease therefor (provided that any such rights do not arise based on a breach of such Transferred Lease by Seller or its Subsidiaries prior to the Effective Time of the Closing) (such rights of a lessor being herein referred to as “ Lessor Contractual Rights ”).

“ Person ” means any individual, corporation, partnership, limited liability company, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Body or other entity.

“ Products ” means any and all products developed, manufactured, marketed or sold in the Business, whether work in progress or in final form.

“ Purchased Intellectual Property ” means all intellectual property rights used by Seller and its Subsidiaries exclusively in connection with the Business and arising from or in respect of the following: (i) all patents and applications therefor, including continuations, divisionals, continuations-in-part, or reissues of patent applications and patents issuing thereon (collectively, “ Patents ”), (ii) all trademarks, service marks, trade names, service names, brand names, all trade dress rights, logos, Internet domain names and corporate names and general intangibles of a like nature, together with the goodwill associated with any of the foregoing, and all applications, registrations and renewals thereof (collectively, “ Marks ”), (iii) copyrights and registrations and applications therefor and works of authorship, moral rights and mask work rights (collectively, “ Copyrights ”) and (iv) all Software and Technology.

-6-

“ Regulatory Approvals ” means (i) any approval of the Federal Communications Commission and the NY PSC necessary for the consummation of the transactions contemplated hereunder or confirmation that each of the Federal Communications Commission and the NY PSC will not take any action to preclude the transfer of the Purchased Assets and Assumed Liabilities to Purchaser, and (ii) approval of the German competition authority, the German Federal Cartel Office (Bundeskartellamt).

“ Release ” means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, or leaching into the indoor or outdoor environment, or into or out of any property.

“ Remedial Action ” means all actions to (i) clean up, remove, treat or in any other way address any Hazardous Material, (ii) prevent the Release of any Hazardous Material so it does not endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (iii) perform pre-remedial studies and investigations or post-remedial monitoring and care; or (iv) to correct a condition of noncompliance with Environmental Laws.

“ Shared Contracts ” means all Contracts related to the Business that also relate to the businesses (other than the Business) conducted by Seller or any of its Affiliates.

“ Significant Customer(s) ” means any customer of the Business with an invoice that exceeded $10,000 per month during the fourth quarter of 2004.

“ Software ” means the software platforms identified on Schedule 1.1(b) .

“ Subsidiary ” of any Person means any other Person of which a majority of the outstanding voting securities or other voting equity interests are owned, directly or indirectly, by such Person.

“ Tax Authority ” means any Governmental Body or employee thereof, charged with the administration of any law or regulation relating to Taxes, whether in the United States or foreign.

“ Tax Return ” means all returns, declarations, reports, estimates, information returns and statements required to be filed in respect of any Taxes (including any attachment thereto or amendment thereof).

“ Taxes ” means (i) all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments, including all net income, gross receipts, capital, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, UK PAYE, UK income tax, UK employer and employee National Insurance contributions, employment, social security, unemployment, excise, severance, stamp, occupation, property and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever, including Universal Service Fund, Federal Communications Commission fees, charges, levies, assessments and similar amounts imposed by state, local or foreign Governmental Body relating to the fact that the Business is a telecommunications business, and (ii) all interest, penalties, fines, additions to tax or additional amounts imposed by any taxing authority in connection with any item described in clause (i).

-7-

“ Technology ” means, collectively, all designs, formulae, algorithms, procedures, methods, techniques, ideas, trade secrets, know-how, research and development, technical data, programs, subroutines, tools, materials, specifications, processes, inventions (whether patentable or unpatentable and whether or not reduced to practice), apparatus, creations, improvements, works of authorship and other similar materials, and all recordings, graphs, drawings, reports, analyses, and other writings, and other tangible embodiments of the foregoing, in any form whether or not specifically listed herein, and all related technology, that are exclusively used in, incorporated in, embodied in, displayed by or relate to, or are used by Seller and its Subsidiaries in the Business.

“ Threatened Regulatory Prohibition ” means (i) any written objection to the consummation of the transactions hereunder or any request for additional information from a Governmental Body of competent jurisdiction that would reasonably be likely to result in an Actual Regulatory Prohibition, (ii) any written notice or bona-fide threat to apply the provisions of the National Security Agreement to Purchaser or its business and operations from and after the Closing, received prior to Closing from the Federal Bureau of Investigation, the United States Department of Justice, the United States Department of Defense or the United States Department of Homeland Security, or (iii) any written notice or other action taken by a Governmental Body of competent jurisdiction that threatens and would be reasonably likely to result in an Actual Regulatory Prohibition.

“ Transition Services Agreement ” means the Transition Services Agreement dated as of the date hereof by and between Purchaser and Seller.

[**]

“ UK Employees ” means Employees whose employment is located in the United Kingdom.

1.2. Terms Defined Elsewhere in this Agreement . For purposes of this Agreement, the following terms have meanings set forth in the sections indicated:


Term		Section
80 Pine Relocation		2.8(a)
AAA		11.3(b)
Accrued Employee Benefits		8.2(d)
Additional Monthly Financial Data		7.16
Agreement		Recitals
Allocation Schedule		2.7
Assumed Liabilities		2.3
Available Financial Data		7.16
Bill of Sale and Assignment and Assumption Agreement		9.2(a)
Circuit Inventory Database		7.14
Closing		4.1

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Term		Section
Closing Date		4.1
Confidentiality Agreement		7.6
Copyrights		1.1 (in Purchased Intellectual Property definition)
Customer Contracts		2.1(f)
Deposits from Customers		2.1(b)(ii)
Deposits with Third Parties		2.1(b)(i)
Disconnect Order		5.4(c)
Employee Benefit Plans		5.10
Employee List		8.1(a)
Equipment		2.1(a)
Escrow Agent		3.2
Excluded Assets		2.2
Excluded Liabilities		2.4
Expenses		10.2(a)(iii)
Financial Data		5.4
Indemnification Claim		10.4(a)
Indemnity Escrow Amount		10.6
Losses		10.2(a)(i)
Marks		1.1 (in Purchased Intellectual Property definition)
Monthly Access Cost Cap		7.12(b)
Non-assignable Assets		2.5(c)
Patents		1.1 (in Purchased Intellectual Property definition)
[**]		[**]
Purchased Assets		2.1
Purchase Price		3.1
Purchased Contracts		2.1(g)
Purchaser		Recitals
Purchaser Documents		6.2
Purchaser Indemnified Parties		10.2(a)
Purchaser Plans		8.2(b)
[**]		[**]
Relocations		7.2(b)
[**]		[**]
Restricted Activities		7.13(a)
Seller		Recitals
Seller Documents		5.2
Seller Indemnified Parties		10.3
Selling Subsidiaries		2.1
Standard Procedure		8.1(b)
Straddle Amounts		3.4(b)
Third Party Claim		10.1
Transferred Employees		8.1(a)
Transferred Leases		5.7

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Term		Section
Transition		7.2(b)
TSA Escrow Amount		3.3
[**]		[**]
[**]		[**]
[**]		[**]
[**]		[**]
[**]		[**]
Unresolved Claims		10.6
Working Teams		7.2(b)
Worship Street Relocation		7.2(b)
Worship Street Relocation Period		8.3(c)(i)(B)

1.3. Other Definitional and Interpretive Matters .

(a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

Calculation of Time Period . When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded. If the last day of such period is a non-Business Day, the period in question shall end on the next succeeding Business Day.

Dollars . Any reference in this Agreement to $ shall mean U.S. dollars.

Exhibits/Schedules . All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Seller may, at its option, include in the Schedules items that are not material in order to avoid any misunderstanding, and such inclusion, or any references to dollar amounts, shall not be deemed to be an acknowledgement, admission or representation that such items are material, to establish any standard of materiality or to define further the meaning of such terms for purposes of this Agreement. No disclosure on a Schedule relating to a possible breach or violation of any Contract, Law or Order shall be construed as an admission or indication that breach or violation exists or has actually occurred. Any capitalized terms used in any Schedule or Exhibit but not otherwise defined therein shall be defined as set forth in this Agreement.

Gender and Number . Any reference in this Agreement to gender shall include all genders, and words imparting the singular number only shall include the plural and vice versa.

Headings . The provision of a Table of Contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of

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reference only and shall not affect or be utilized in construing or interpreting this Agreement. All references in this Agreement to any “ Section ” are to the corresponding Section of this Agreement unless otherwise specified.

Herein . The words such as “ herein ,” “ hereinafter ,” “ hereof ,” and “ hereunder ” refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires.

Including . The word “ including ” or any variation thereof means “ including, without limitation ” and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it.

Reflected On or Set Forth In . An item arising with respect to a specific representation or warranty shall be deemed to be “ reflected on ” or “ set forth in ” a balance sheet or financial statements delivered to Purchaser, to the extent any such phrase appears in such representation or warranty, (a) to the extent there is a reserve, accrual or other similar item underlying a number on such balance sheet or financial statements that related to the subject matter of such representation and which is disclosed thereon, as to amount and purpose, (b) if such item is otherwise specifically set forth on the balance sheet or financial statements or (c) if such item is reflected on the balance sheet or financial statements and is specifically set forth in the notes thereto.

(b) The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.

ARTICLE II

PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

2.1. Purchase and Sale of Assets . On the terms and subject to the conditions set forth in this Agreement, at the Closing, Purchaser or its assigns shall purchase, acquire and accept from Seller and its Subsidiaries, and Seller shall, or shall cause its Subsidiaries (such Subsidiaries, the “ Selling Subsidiaries ”) to, sell, transfer, assign, convey and deliver to Purchaser or its assigns all of Seller’s and its Subsidiaries’ right, title and interest in, to and under the Purchased Assets. “ Purchased Assets ” shall mean the following assets, rights, privileges, claims, contracts and properties owned or held by Seller and its Subsidiaries as of the Closing that relate to and are used in the Business:

(a) all equipment, other personal property and fixtures used exclusively in the Business (including all spare and replacements equipment, personal property and fixtures in inventory), including the equipment listed on Schedule 2.1(a) , including testing equipment (all of the foregoing being herein referred to as the “ Equipment ”);

(b) (i) the right to, and the right to seek recovery of, the deposit currently held by the lessor under the Newark Lease in the amount of $84,909.86 ; and (ii) all deposits in respect of prepaid revenues which have been received by Seller and its Subsidiaries relating to services to be rendered by the Business for any period following the Effective Time of the Closing (“ Deposits from Customers ”);

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(c) all rights of Seller and its Subsidiaries under the Transferred Leases, together with all improvements, fixtures and other appurtenances located therein;

(d) the Purchased Intellectual Property;

(e) to the extent transferable, all rights in the Customer Access Circuits;

(f) all rights of Seller and its Subsidiaries under all sales or service orders, master services agreements, customer contracts or other similar Contracts entered into by Seller or its Subsidiaries in connection with the Business and any undocumented ongoing courses of dealing to provide the services of the Business to customers other than the Shared Contracts (“ Customer Contracts ”);

(g) the Contracts listed on Schedule 2.1(g) (the “ Purchased Contracts ”);

(h) all Documents that are used predominantly in the Business, including Documents relating to Products, services, marketing, advertising, promotional materials, Purchased Intellectual Property, personnel files for Transferred Employees to the extent permitted by applicable Law and all files, customer files and documents (including credit information), supplier lists, Customer Contracts, records, literature and correspondence, whether or not physically located on any of the premises referred to in clause (d) above, but excluding personnel files for Employees of Seller or its Subsidiaries who are not Transferred Employees, and excluding such files as may be required under applicable Law regarding privacy; provided , however , that Purchaser shall preserve such Documents (other than attendance records of the Transferred Employees and any marketing, advertising and promotional records and materials) and Seller shall have the right prior to the delivery thereof to make copies thereof and thereafter of reasonable access to and examination of such Documents, including the right to make copies thereof, subject to applicable Law and an appropriate confidentiality agreement, for a period of six (6) years from the Closing Date upon reasonable notice to Purchaser and during normal business hours for the purpose of satisfying claims of third parties arising from, and relating to, periods prior to the Closing or to otherwise comply with applicable Law;

(i) all rights of Seller and its Subsidiaries under non-disclosure or confidentiality, non-compete, or non-solicitation agreements with any Transferred Employee or with third parties to the extent relating to the Business or the Purchased Assets (or any portion thereof);

(j) all rights of Seller and its Subsidiaries under or pursuant to all warranties, representations, maintenance agreements and guarantees made by suppliers, manufacturers and contractors to the extent relating to Products sold, or services provided, to Seller and its Subsidiaries in the Business or to the extent affecting any Purchased Assets;

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(k) all goodwill and other intangible assets associated with the Business, including customer and supplier lists and the goodwill associated with the Purchased Intellectual Property;

(l) all existing rights of Seller or any of its Subsidiaries to the brand names “ Trader Voice ” and “ IXnet ”;

(m) the rights to the extent relating to the Business under the Shared Contracts set forth on Schedule 2.1(m) ;

(n) all rights of Seller and any of its Subsidiaries to proceeds recovered or recoverable under insurance policies from and after the date hereof relating to the Purchased Assets or the Business (including business interruption insurance (if any)), provided, however, that neither Seller nor any of its Subsidiaries shall have any obligation to maintain in effect after the Closing Date any insurance policy that related to the Purchased Assets, but Seller shall maintain in effect until the Closing all current insurance policies covering the Purchased Assets and the Business; and

(o) subject to the following paragraph, any and all other assets, property, and rights not specified in clauses (a) through (n) above owned or held immediately prior to the Closing Date by Seller or any of its Subsidiaries that are used primarily in, or primarily relate to, the Business and not described in this Section 2.1, but not Excluded Assets.

No asset shall be deemed a Purchased Asset solely as a result of clause (o) above unless a claim with respect thereto is made by Purchaser, or Seller notifies Purchaser of the inadvertent omission of transfer to Purchaser thereof, on or prior to the date that is 365 days after the Closing Date, and neither party disputes that such asset should constitute a Purchased Asset. If either party disputes that such asset should be a Purchased Asset, then during the fifteen (15) days following such claim, the parties will use reasonable efforts to reach agreement on the status of such asset. If the parties cannot reach agreement within such 15 day period, then the dispute regarding whether any such asset should constitute a Purchased Asset shall be resolved pursuant to Section 11.3 hereof.

2.2. Excluded Assets . Nothing herein contained shall be deemed to sell, transfer, assign or convey the Excluded Assets to Purchaser, and Seller shall retain all right, title and interest to, in and under the Excluded Assets. “ Excluded Assets ” shall mean all assets, properties, interests and rights of Seller and its Subsidiaries other than the Purchased Assets, including each of the following assets:

(a) all cash, cash equivalents, bank deposits or similar cash items of Seller and its Subsidiaries;

(b) except for the deposit held by the lessor under the Newark Lease as specified in clause (b)(i) of the second sentence of Section 2.1 , all other deposits made by Seller and it Subsidiaries with third parties relating to the Purchased Assets, and all deposits or prepaid charges and expenses paid in connection with or relating to any Excluded Asset;

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(c) all trade receivables and other accounts and notes receivable of Seller and any of its Subsidiaries associated with or arising out of the Business accruing on or prior to the Closing Date and all intercompany accounts receivable;

(d) the Excluded Contracts, including any accounts receivable arising out of or in connection with any Excluded Contract;

(e) any intellectual property rights of Seller and its Subsidiaries other than the Purchased Intellectual Property including SCORE;

(f) any (i) confidential personnel and medical records pertaining to any Employee; (ii) other books and records (including Tax Returns) that Seller and its Subsidiaries are required by Law to retain; provided , however , that Purchaser shall have the right to make copies of any portions of such retained books and records that relate to the Business or any of the Purchased Assets and Seller shall retain such books and records for a period of six (6) years following Closing; (iii) any information management systems of Seller and its Subsidiaries, other than those used or held for use predominantly in the conduct of the Business; and (iv) documents relating to proposals to acquire the Business by Persons other than Purchaser;

(g) any claim, right or interest of Seller or any of its Subsidiaries in or to any refund, rebate, abatement or other recovery for Taxes, together with any interest due thereon or penalty rebate arising therefrom, for any Tax period (or portion thereof) ending on or before the Closing Date;

(h) all insurance policies or, except as provided in Section 2.1(n), rights to proceeds thereof relating to the assets, properties, business or operations of Seller or any of its Subsidiaries;

(i) any rights, claims or causes of action of Seller or any of its Subsidiaries against third parties relating to the Business arising out of events occurring on or prior to the Closing Date;

(j) except as provided in Section 2.1(m), any rights to or under the Shared Contracts; and

(k) capital stock of any Subsidiary of Seller.

2.3. Assumption of Liabilities . On the terms and subject to the conditions set forth in this Agreement, at the Closing, Purchaser shall assume, effective as of the Closing, and shall timely perform and discharge in accordance with their respective terms, all Liabilities related to the Business that arise from the operation of the Business or the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases solely from and after the Effective Time of the Closing, but excluding any Excluded Liabilities (collectively, the “ Assumed Liabilities ”), including:

(a) all Liabilities under the Customer Contracts, under the Purchased Contracts and arising from those rights under the Shared Contracts transferred to

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Purchaser in accordance with Section 2.1(m), in each case that arise from the operation of the Business or the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases solely from and after the Effective Time of the Closing;

(b) Liabilities under the Transferred Leases (subject to Section 2.8) that arise from the operation of the Business or the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases solely from and after the Effective Time of the Closing;

(c) all Liabilities associated with the Customer Access Circuits that arise from the operation of the Business or the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases solely from and after the Effective Time of the Closing;

(d) Liabilities based on or arising out of the sale of Products effected solely from and after the Effective Time of the Closing pursuant to product warranties, product returns and rebates;

(e) accounts payable of the Business relating to periods from and after the Effective Time of the Closing; and

(f) all other Liabilities arising out of the conduct or operation of the Business, the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases or, except as provided in Article VIII, the Transferred Employees and the UK Transferred Employees, in each case solely from and after the Effective Time of the Closing.

2.4. Excluded Liabilities . Purchaser does not and will not assume the Excluded Liabilities, and nothing contained herein shall be construed to impose upon Purchaser, any Liability (whether of Seller or its Subsidiaries or any of their respective Affiliates or predecessor owners, users or operators of the Business or the Purchased Assets or the property which is the subject of the Transferred Leases) arising or accruing out of the operation of the Business, the Purchased Assets or the use, ownership or operation of the Purchased Assets, in each case solely prior to the Effective Time of the Closing. “ Excluded Liabilities ” shall mean all Liabilities other than the Assumed Liabilities, including all Liabilities of Seller, any of its Subsidiaries and any of their respective Affiliates or predecessors relating to, or arising from, or based upon, or which results from, the operation of the Business or the use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases prior to the Effective Time of the Closing, whether accruing, arising or asserted before or after the Effective Time of the Closing, and the following:

(a) all Liabilities arising out of Excluded Assets and Excluded Contracts;

(b) except as otherwise provided herein, all Liabilities for Taxes (i) for all taxable periods (or portions thereof), in the case of Taxes relating to the Excluded Assets, (ii) for all taxable periods (or portions thereof) ending on or prior to (or, to the extent attributable to the portion of such period ending on the Closing Date, including) the Effective Time of the Closing, in the case of Taxes relating to the Purchased Assets or the

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property which is the subject of the Transferred Leases, and (iii) under any Tax allocation, sharing or similar agreement (whether oral or written, and including any agreement requiring indemnification for Taxes), which Taxes are incurred in respect of income, transactions, use or ownership of the Purchased Assets or the property which is the subject of the Transferred Leases occurring prior to (or to the extent attributable to the portion of such period ending on the Closing Date, including) the Effective Time of the Closing; and including all Taxes described on Schedule 5.14 ;

(c) all Liabilities under the Customer Contracts, the Purchased Contracts and the Transferred Leases (subject to Section 2.3 and 2.8) or associated with the Customer Access Circuits, in each case, regardless of when accrued or asserted, which (i) arise based on or as a result of the operations of the Business or the use or ownership of the Purchased Assets or the property which is subject to the Transferred Leases prior to the Effective Time of the Closing, (ii) arise based on any violation of applicable Laws (including by Seller or its Subsidiaries or their respective predecessors) prior to the Effective Time of the Closing, or (iii) arise after the Effective Time of the Closing based on any breach by Seller or its Subsidiaries prior to the Effective Time of Closing;

(d) all Liabilities arising under the Customer Contracts, the Purchased Contracts, the Transferred Leases or Customer Access Circuits, in each case resulting from the sale of Purchased Assets to the Purchaser;

(e) all Liabilities (including of Seller, any of its Subsidiaries and any of their respective Affiliates and predecessors) in respect of employees (other than Liabilities with respect to periods of employment solely from and after the Effective Time of the Closing in respect of Transferred Employees and the UK Transferred Employees, as expressly set forth in Sections 8.2 and 8.3), and in the case of the Transferred Employees and the UK Transferred Employees (subject to Sections 8.2 and 8.3) relating to periods or partial periods prior to the Effective Time of the Closing, including claims of employees listed on Schedule 5.11 ;

(f) except as provided in Section 11.1, all transfer taxes and all other similar Taxes applicable to the transfer of the Purchased Assets pursuant to this Agreement;

(g) all Liabilities imposed or sought to be imposed upon Purchaser based on any principal or theory of successor liability which seeks to treat Purchaser as a successor to Seller or its Subsidiaries or any of their respective predecessors, except for such Liabilities arising after the Effective Time of the Closing resulting from a claim based on any action taken by Purchaser or its Affiliates in the operation of the Business solely from and after the Effective Time of the Closing;

(h) Liabilities based on or arising out of the sale of Products effected prior to the Effective Time of the Closing pursuant to product warranties, product returns and rebates; and

(i) (A) any Lien imposed or sought to be imposed on the Purchased Assets based on or as a result of the operations of the Business or use or ownership of the

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Purchased Assets or the property which is subject to the Transferred Leases prior to the Effective Time of the Closing, without regard to any materiality qualification, notwithstanding that such Lien would be classified as a Permitted Exception for purposes of any other provision of this Agreement, and other than Lessor Contractual Rights as defined in the definition of Permitted Exceptions, other than rights of third parties under the terms of Contracts included in the Purchased Assets (provided that any such rights do not arise based on a breach of such Contract by Seller or the Selling Subsidiaries prior to the Effective Time of the Closing), and other than Liens created by Purchaser after the Closing, and (B) any Liability imposed or sought to be imposed on Purchaser or any Lien imposed or sought to be imposed on the Purchased Assets resulting from or arising out any Order by a Governmental Body of competent jurisdiction, based on or as a result of the operations of the Business or use or ownership of the Purchased Assets or the property which is subject to the Transferred Leases prior to the Effective Time of the Closing, or the continuation by the Purchaser of the Business or the use of the Purchased Assets or such property in substantially the same manner (but not based on or the result of other actions taken by Purchaser after the Effective Time of the Closing), without regard to any materiality qualification, (x) restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby or (y) that imposes upon Purchaser any Business Restriction or Liability relating to or arising out of such Business Restriction (and which Order does not relate to assets of Purchaser or other businesses that do not constitute Purchased Assets or the Business).

2.5. Further Conveyances and Assumptions; Consent of Third Parties .

(a) From time to time following the Closing, Seller shall, or shall cause its Affiliates to, make available to Purchaser such non-confidential data in personnel records of the Transferred Employees and the UK Transferred Employees as is reasonably necessary for Purchaser to transition such employees into Purchaser’s records.

(b) On the Closing Date and from time to time following the Closing, Seller and Purchaser shall, and shall cause their respective Affiliates to, execute, acknowledge and deliver all such further conveyances, notices, assumptions, releases and acquaintances and such other instruments, and shall take such further actions, as may reasonably be necessary or appropriate to assure fully to Purchaser and its respective successors or assigns, all of the properties, rights, titles, interests, estates, remedies, powers and privileges intended to be conveyed to Purchaser under this Agreement and the Seller Documents and to assure fully to Seller and its Affiliates and their successors and assigns, the assumption of the liabilities and obligations intended to be assumed by Purchaser under this Agreement and the Purchaser Documents, and to otherwise make effective the transactions contemplated hereby and thereby.

(c) Nothing in this Agreement nor the consummation of the transactions contemplated hereby shall be construed as an attempt or agreement to assign any (i) Purchased Asset, including any Contract, Permit, certificate, approval, authorization or other right, including the Customer Access Circuits which by its terms or by Law is non-assignable without the consent of a third party or a Governmental Body or is cancelable by a third party in the event of an assignment (“ Non-assignable Assets ”) or (ii) rights to Shared Contracts which require consent of a third party to be transferred or assigned, unless and until such consent shall have

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been obtained. With respect to Customer Contracts, Purchased Contracts, Permits, Customer Access Circuits or Shared Contracts that are material for the operation of the Business after the Closing Date, Seller shall, and shall cause its Subsidiaries and their respective Affiliates to, use its commercially reasonable efforts for up to one (1) year following the Closing Date in endeavoring, in the case of Customer Contracts, Purchased Contracts, Permits or Customer Access Circuits, to obtain such consents promptly, and in the case of rights to Shared Contracts to either (i) obtain such consents as to the portion of such Shared Contracts related to the Business or (ii) obtain a license for the benefit of Purchaser as to such Shared Contracts; provided , however , that such efforts shall not require Seller or any of its Affiliates to incur any significant expenses or Liabilities or provide any financial accommodation or to remain secondarily or contingently liable for any Assumed Liability to obtain any such consent or license as applicable. Purchaser and Seller shall use their respective commercially reasonable efforts to obtain, or cause to be obtained, any consent, substitution, approval or amendment required to novate or assign all Liabilities under any and all Customer Contracts and Purchased Contracts, or its proportionate share of Liabilities under any and all Shared Contracts or other Liabilities of any nature whatsoever that constitute Assumed Liabilities, or to obtain in writing the unconditional release of Seller and its Affiliates so that, in any such case, Purchaser shall be solely responsible for such Liabilities which arise and relate to periods following the Closing Date. To the extent permitted by applicable Law, in the event consents to the assignment or license thereof cannot be obtained, such Non-assignable Assets or portions of Shared Contracts related to the Business shall be held, as of and from the Closing Date, by Seller or the applicable Affiliate of Seller in trust for Purchaser and the covenants and obligations thereunder shall be performed by Purchaser in Seller’s or such Affiliate’s name and all benefits and obligations existing thereunder shall be for Purchaser’s account. Seller shall take or cause to be taken at Purchaser’s expense such actions in its name or otherwise as Purchaser may reasonably request so as to provide Purchaser with the benefits of the Non-assignable Assets or portions of the Shared Contracts related to the Business and to effect collection of money or other consideration that becomes due and payable under the Non-assignable Assets or such portions of Shared Contracts related to the Business, and Seller or the applicable Affiliate of Seller shall promptly pay over to Purchaser all money or other consideration received by it in respect of all Non-assignable Assets or portions of Shared Contracts related to the Business. As of and from the Closing Date, Seller on behalf of itself and its Affiliates authorizes Purchaser, to the extent permitted by applicable Law and the terms of the Non-assignable Assets and Shared Contracts, at Purchaser’s expense, to perform all the obligations and receive all the benefits of Seller or its Affiliates under the Non-assignable Assets or portions of the Shared Contracts related to the Business and appoints Purchaser its attorney-in-fact to act in its name on its behalf or in the name of the applicable Affiliate of Seller and on such Affiliate’s behalf with respect thereto, and Purchaser agrees to indemnify and hold each Seller Indemnified Party harmless from and against any and all Liabilities and Losses based upon, arising out of or relating to Purchaser’s performance of, or failure to perform, such obligations under the Non-assignable Assets or the portions of Shared Contracts related to the Business following the Closing Date, and Seller agrees to indemnify and hold each Purchaser Indemnified Party harmless from and against any and all Liabilities and Losses based upon, arising out of or relating to Seller’s performance of, or failure to perform, such obligations under the Non-assignable Assets or portions of Shared Contracts related to the Business prior to Closing. Notwithstanding any of the foregoing, Seller shall, and shall cause its Subsidiaries and their respective Affiliates to, hold the Customer Access Circuits in trust for the Purchaser in accordance with the terms and conditions of the Transition Services Agreement.

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2.6. Bulk Sales Laws . Purchaser hereby waives compliance by Seller and its Subsidiaries with the requirements and provisions of any “ bulk-transfer ” Laws of any jurisdiction that may otherwise be applicable with respect to the sale of any or all of the Purchased Assets to Purchaser. However, such waiver shall not relieve Seller of its obligation to indemnify Purchaser in respect of all Excluded Liabilities, subject to the provisions of Section 10.2(a) .

2.7. Purchase Price Allocation . Purchaser shall, within one hundred and twenty (120) days after the Closing Date, prepare and deliver to Seller a schedule (the “ Allocation Schedule ”) allocating the Purchase Price and the Assumed Liabilities among the Purchased Assets in accordance with Section 1060 of the Code and the Treasury Regulations promulgated thereunder or any successor provisions. Seller will have the right to raise reasonable objections to the Allocation Schedule (including subsequent revisions thereto) within thirty (30) days after its receipt thereof, in which event Purchaser and Seller will negotiate in good faith to resolve such objections. If Purchaser and Seller cannot mutually resolve Seller’s reasonable objections to the Allocation Schedule within twenty (20) days after Purchaser’s receipt of such objections, such dispute shall be presented to an independent accountant mutually agreed upon by Purchaser and Seller on the next Business Day for a decision that shall be rendered by such independent accountant within thirty (30) calendar days thereafter and shall be final and binding upon each of the parties absent manifest computational error. The fees, costs and expenses incurred in connection therewith shall be shared in equal amounts by Purchaser, on the one hand, and Seller, on the other hand. Purchaser and Seller each shall report and file all Tax Returns (including amended Tax Returns and claims for refund) consistent with the Allocation Schedule, and shall take no position with respect to Taxes contrary thereto or inconsistent therewith (including in any audits or examinations by any taxing authority or any other proceedings) with respect to the transactions contemplated by this Agreement. Purchaser and Seller shall cooperate in the filing of any forms (including Form 8594) with respect to such allocation, including any amendments to such forms required with respect to any adjustment to the Purchase Price, pursuant to this Agreement. Notwithstanding any other provisions of this Agreement, the provisions of this Section 2.7 shall survive the Closing without limitation.

2.8. Leases .

(a) Newark Lease . Notwithstanding anything herein to the contrary, Seller shall transfer the Newark Lease to Purchaser, and Purchaser shall assume the Liabilities thereunder, subject to obtaining the Landlord’s (as defined in the Newark Lease) written consent, and subject to Sections 2.3, 2.4 and (as applicable) 7.2(b), as of the first day of the first month following the month in which the migration of all facilities of Seller related to the Business from 80 Pine Street, New York, New York to the Premises (as defined in the Newark Lease) in Newark, New Jersey is completed (the “ 80 Pine Relocation ”). Seller agrees to use its commercially reasonable efforts to obtain, prior to or upon completion of the 80 Pine Relocation, the Landlord’s written consent to assign the Newark Lease to Purchaser, and Purchaser shall assist and cooperate with Seller and its representatives to the extent reasonably necessary in obtaining such consent.

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2.9. CBOT Leases . Seller agrees to use its commercially reasonable efforts to obtain the Landlord’s (as defined in the CBOT Leases) written consent to assign the CBOT Leases to Purchaser, and Purchaser shall assist and cooperate with Seller and its representatives to the extent reasonably necessary in obtaining such consent.

ARTICLE III

CONSIDERATION

3.1. Consideration . The aggregate consideration for the Purchased Assets shall be (a) an amount in cash equal to $25,000,000 (the “ Purchase Price ”), and (b) the assumption of the Assumed Liabilities.

3.2. Payment of Purchase Price . On the Closing Date, Purchaser shall pay to Global Crossing North American Holdings, Inc., on behalf of the Selling Subsidiaries, or its designee the Purchase Price less the (i) Indemnity Escrow Amount, (ii) the TSA Escrow Amount (each of the Indemnity Escrow Amount and the TSA Escrow Amount shall be deposited with The Bank of New York, as “ Escrow Agent ”), and (iii) if elected by Purchaser in accordance with the Management Agreement, the Management Fee (as defined in the Management Agreement). Such adjusted Purchase Price shall be paid by wire transfer of immediately available funds into an account designated by Seller and shall be paid free and clear of any withholding Taxes. The Indemnity Escrow Amount shall constitute collateral security for the obligations of Seller under Article X of this Agreement and the TSA Escrow Amount shall constitute collateral security for the transition obligations of Seller under the Transition Services Agreement; and the Escrow Agent, pursuant to the Escrow Agreement, shall agree to act as collateral agent for Purchaser.

3.3. The TSA Escrow Amount . On the Closing Date, Purchaser, on behalf of the Selling Subsidiaries, shall deposit with the Escrow Agent an amount equal to $1,000,000 (the “ TSA Escrow Amount ”) in immediately available funds. The TSA Escrow Amount will be held by the Escrow Agent in a separately identified account apart from the Indemnity Escrow Amount designated by the Escrow Agent and will be disbursed pursuant to the terms of the Escrow Agreement and the Transition Services Agreement.

3.4. Apportionment .

(a) All amounts payable relating to or accruing in respect of the Business (including Taxes in accordance with Section 11.1(c)) prior to the Effective Time of the Closing shall be borne by Seller (and, so far as practicable, shall be discharged in full by Seller prior to the Effective Time of the Closing), and all amounts payable relating to or accruing in respect of the Business from and after the Effective Time of the Closing relating to operations of the Business following the Effective Time of the Closing shall be borne by Purchaser. All payments receivable or accruing in respect of the Business relating to the period prior to the Effective Time of the Closing shall belong to Seller; and all payments receivable or accruing in respect of the Business relating to the period from and after the Effective Time of the Closing (including all deposits and prepaid revenues received by Seller or the Business prior to the Effective Time of the Closing in respect of revenues, services, expenses or liabilities of the Business for periods from and after the Effective Time of the Closing) shall belong to the Purchaser. Those amounts payable and amounts receivable in respect of any period or partial period commencing before or on the Effective Time of the Closing and ending after the Closing shall, if necessary, be apportioned in accordance with Section 3.4(b) .

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(b) All amounts referred to in Section 3.4(a) which relate to a period commencing on or before and ending after the Effective Time of the Closing or occur between billing cycles (“ Straddle Amounts ”) shall be apportioned on a time basis (except that all charges and outgoings specifically referable to the extent of the use of any property, services or rights shall be apportioned according to the extent of such use), so that part of such charges and outgoings as is attributable to the period prior to the Effective Time of the Closing shall be borne by Seller and the part of the charges and outgoings as is attributable to the period commencing from and after the Effective Time of the Closing shall be borne by Purchaser.

(c) Seller and Purchaser shall cooperate to prepare a schedule of the items referred to in Section 3.4(a) to be apportioned within 60 days after the Closing. Seller and Purchaser shall use their best efforts to agree the net amount (if any) payable by or to Seller. All amounts payable by Purchaser or Seller to the other party in accordance with this Section 3.4 shall be held in trust for the other party and Purchaser and Seller agree to promptly remit amounts owing, if any, to the other party. Any disputes regarding Straddle Amounts shall be resolved in accordance with the provisions of Section 11.3 hereof.

3.5. Deposits (Other than Deposits from Customers) Held by Seller . In the event that Seller or its Subsidiaries shall hold any deposit from any customer of the Business which are not otherwise Deposits from Customers, and such customer advises Seller or Purchaser that such customer is entitled to such deposit, Seller or Purchaser shall give the other notice of such notice from the customer and Seller shall promptly turn over any such deposit to the customer; however, such deposit shall not be turned over to the customer if (i) Purchaser advises Seller that it disputes that the customer is entitled to the return of the deposit, and Purchaser shall indemnify Seller for any Liability imposed upon Seller for failing to return the deposit to the customer, or (ii) Seller advises Purchaser that it disputes that the customer is entitled to the return of the deposit, and Seller shall indemnify Purchaser for any Liability imposed upon Purchaser for failing to return the deposit to the customer at the request of Purchaser or customer. Seller acknowledges that all deposits from any customer of the Business which are not otherwise Deposits from Customers but which the customer is entitled to receive, whether or not a customer has made a demand therefor, are held in trust for Purchaser and its customer until turned over to the customer as aforesaid. Any deposit from any customer of the Business held by Seller, whether a demand has been made therefor or identified as a deposit from a customer of the Business, shall be held in a separate account designated as being held in trust pursuant to this Section 3.5 . In the event of any dispute with respect to any deposit from the customer which is not otherwise Deposits from Customers, Seller shall deliver the deposit in accordance with any final determination of any court or arbitrator appointed to resolve the dispute.

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ARTICLE IV

CLOSING AND TERMINATION

4.1. Closing Date . Subject to the satisfaction of the conditions set forth in Section 9.1 hereof (or the waiver thereof by the party entitled to waive that condition), the closing of the purchase and sale of the Purchased Assets and the assignment and assumption of the Assumed Liabilities provided for in Article II hereof (the “ Closing ”) shall take place at the offices of Weil, Gotshal & Manges LLP located at 767 Fifth Avenue, New York, New York (or at such other place as the parties may designate in writing) at 10:00 a.m. (New York City time) on a date to be specified by the parties, which date shall be no later than the second Business Day after satisfaction or waiver of the conditions set forth in Article IX (other than conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions), unless another time or date, or both, are agreed to in writing by the parties hereto. The date on which the Closing shall be held is referred to in this Agreement as the “ Closing Date .”

4.2. Termination of Agreement . This Agreement may be terminated prior to the Closing as follows:

(a) at the election of Seller or Purchaser on or after June 30, 2005, if the Closing shall not have occurred by the close of business on such date, provided that the terminating party is not in material default of any of its obligations hereunder; however, if the Closing has not occurred by such date solely because the Seller Closing Delivery under clause (f) of Section 9.2 has not been satisfied, then such termination date shall be automatically extended for 30 days;

(b) by mutual written consent of Seller and Purchaser; or

(c) by Seller or Purchaser if there shall be in effect a final nonappealable Order of a Governmental Body of competent jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby; it being agreed that the parties hereto shall promptly appeal any adverse determination which is not nonappealable (and pursue such appeal with reasonable diligence).

4.3. Procedure Upon Termination . In the event of termination and abandonment by Purchaser or Seller, or both, pursuant to Section 4.2 hereof, written notice thereof shall forthwith be given to the other party or parties, and this Agreement shall terminate, and the transactions contemplated hereunder shall be abandoned, without further action by Purchaser or Seller.

4.4. Effect of Termination .

(a) In the event that this Agreement is terminated in accordance with Section 4.2 , then each of the parties shall be relieved of its duties and obligations arising under this Agreement after the date of such termination and such termination shall be without liability to Purchaser or Seller; provided , that the obligations of the parties set forth in Article X hereof shall survive any such termination and shall be enforceable hereunder.

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(b) Nothing in this Section 4.4 shall relieve Purchaser or Seller of any liability for any willful breach of this Agreement prior to the date of termination. The damages recoverable by the non-breaching party shall include all attorneys’ fees reasonably incurred by such party in connection with the transactions contemplated hereby.

(c) The Confidentiality Agreement shall survive any termination of this Agreement and nothing in this Section 4.4 shall relieve Purchaser or Seller or their respective Affiliates of their obligations under the Confidentiality Agreement.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF SELLER

As of the date hereof and as of the Closing Date (except (i) as expressly set forth in the last sentence of Section 5.6 or (ii) to the extent that any representation and warranty speaks as of a specific date), Seller hereby represents and warrants to Purchaser (and for the benefit of Purchaser Indemnified Parties), as follows, and acknowledges that Purchaser is relying on the such representations and warranties in connection with this Agreement and the consummation of the contemplated transactions:

5.1. Organization . Seller is a company duly organized and validly existing under the laws of its jurisdiction of incorporation, organization or formation and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now conducted.

5.2. Authorization of Agreement . Seller has all requisite power and authority to execute and deliver this Agreement, and Seller and each of its Subsidiaries has all requisite power, authority and legal capacity to execute and deliver each other agreement, document, or instrument or certificate contemplated by this Agreement or to be executed by Seller or its Subsidiaries in connection with the consummation of the transactions contemplated by this Agreement (the “ Seller Documents ”), including the other Ancillary Agreements, to perform their respective obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Seller and each of its Subsidiaries. This Agreement has been, and each of the Ancillary Agreements will be at or prior to the Closing, duly and validly executed and delivered by Seller and each of its Subsidiaries which is a party thereto and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each of the Ancillary Agreements when so executed and delivered will constitute, legal, valid and binding obligations of Seller, or, as the case may be, its Subsidiary enforceable against Seller or, as the case may be, its Subsidiary in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally.

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5.3. Conflicts; Consents of Third Parties .

(a) Except as set forth on Schedule 5.3(a) , none of the execution and delivery by Seller of this Agreement or by Seller and its Subsidiaries of the Ancillary Agreements, the consummation of the transactions contemplated hereby or thereby, or compliance by Seller and its Subsidiaries with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination or cancellation under any provision of (i) the certificate of incorporation and by-laws or comparable organizational documents of Seller or any Subsidiary; (ii) any Contract or Permit to which Seller or any Subsidiary is a party or by which any of the properties or assets of Seller or any Subsidiary are bound that are related to the Business; (iii) any Order of any Governmental Body applicable to Seller or any Subsidiary in respect of the Business or by which any of the properties or assets of Seller or any Subsidiary related to the Business are bound; or (iv) any applicable Law, other than, in the case of clauses (ii), (iii) and (iv), such conflicts, violations, defaults, terminations or cancellations that would not result in the imposition upon Purchaser of any material Liability or material Business Restriction.

(b) Except as set forth on Schedule 5.3(b) , and except with respect to the matters set forth in Section 5.16, no consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any Person or Governmental Body is required on the part of Seller or any Subsidiary in connection with the execution and delivery of this Agreement or the Seller Documents, the compliance by Seller or any Subsidiary with any of the provisions hereof or thereof, or the consummation of the transactions contemplated hereby or thereby, or the taking by Seller or any Subsidiary of any other action contemplated hereby or thereby, except for consents, waivers, approvals, Orders, Permits or authorizations the failure of which to obtain would not result in the imposition upon Purchaser of any material Liability or material Business Restriction.

5.4. Financial Data .

(a) Schedule 5.4(a) sets forth the financial data provided to Purchaser by Seller prior to the date hereof (the “ Financial Data ”). The Financial Data (and the Additional Monthly Financial Data) has been (and will be) prepared in good faith and fairly presents (and will fairly present) the following matters:

(i) gross and net revenues of the Business or Global Crossing Financial Markets business, as applicable, for the periods shown on Schedule 5.4(a) through December 31, 2004 and for the month of January 2005, and for the periods covered by the Additional Monthly Financial Data, as adjusted for customer credits (except for revenues in North America which have not been adjusted for customer credits); all revenue is as billed to the customer with any back billing or quarterly billing reflected in the month it was billed to the customer;

(ii) credits given to customers of the Business in North America for the year ended December 31, 2004 and the month of January 2005 and for the periods covered by the Additional Monthly Financial Data, including any such credits applicable to additional periods from and after such periods; provided that Purchaser acknowledges that credits relate to both services provided by the Business and services provided outside of the Business and have not been broken out; and

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(iii) monthly recurring cost of access for third party circuits for the Global Crossing Financial Markets business for the year ended December 31, 2004 and the month of January 2005 and for the periods covered by the Additional Monthly Financial Data.

The annual net revenue of the Business, as adjusted for customer credits (except for revenues in North America which have not been adjusted for customer credits), as of January 31, 2005 was at least $[**] based on the annualized revenue for January 2005.

(b) As of the date hereof, (i) there are no outstanding claims for credits or revenue write-downs previously requested by customers of the Business which have not been satisfied by Seller or disclosed to Purchaser, and (ii) to the Knowledge of Seller, there are no outstanding claims for credits or revenue write-downs by customers of the Business.

(c) Schedule 5.4(c) sets forth, as of the date hereof, Significant Customers who have provided notice to Seller or any of its Subsidiaries or any of their respective Affiliates of an election to discontinue services with respect to a circuit provided by the Business (“ Disconnect Order ”) where such notice has been provided: (i) prior to December 31, 2004 if any discontinuance is not yet reflected as to the loss of revenues from such Significant Customers in all material amounts in the Financial Data, or (ii) since December 31, 2004 in any case.

(d) To the Knowledge of Seller, Seller has disclosed to Purchaser all of the deposits made by Seller and it Subsidiaries with third parties relating to the Purchased Assets.

5.5. Title to Purchased Assets . Except as set forth on Schedule 5.5 , Seller and its Subsidiaries own and have good fee, leasehold or other valid title to each of the Purchased Assets, free and clear of all Liens other than Permitted Exceptions and at the Closing (subject to Sections 2.5, 2.8 and 2.9) Purchaser will receive valid title to all such assets free and clear of all Liens, except for Permitted Exceptions. All of the tangible Assets to be purchased are in good operating condition and good maintenance, subject to normal wear and tear, and are suitable for the continued use in the Ordinary Course of the Business. Seller and its Subsidiaries have their respective Purchased Assets in their possession or in locations as to which there are valid and enforceable leases or collocation agreements in favor of Seller or its Subsidiaries and which are included in the Purchased Assets.

5.6. Absence of Certain Developments . Except as expressly contemplated by this Agreement or as set forth on Schedule 5.6(a) , since January 1, 2004 or, in the case of clauses (ii) and (iii) below or clause (vi) as such clause (vi) relates to matters which are the subject of clause (ii), since the date of the most recent Financial Data delivered to Purchaser prior to the date of this Agreement: (i) Seller and its Subsidiaries have conducted the Business only in the Ordinary Course of Business and in a manner to continue it as a going concern; (ii) neither Seller nor its Subsidiaries is aware of any facts which would give rise to the material reduction in orders or revenue from any Significant Customer or material reduction in any source of supply from any material vendor and has not had any Significant Customer advise it on or prior to the date hereof

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that it would or will discontinue using Seller or its Subsidiaries services or materially reduce its purchases of services from the Business, either in dollar amounts or services used; (iii) neither Seller nor its Subsidiaries has materially altered prices or incentives to Significant Customers of the Business; (iv) there has been no general increase (other than increases in the Ordinary Course of Business consistent with past practice) in the compensation of Employees or other bonuses (other than bonuses made available to substantially all employees of Seller or its Subsidiaries) or amounts paid to Employees and no agreement exists to do so; (v) there have been no acquisitions or dispositions of assets other than in the Ordinary Course of Business; and (vi) as of the date this Agreement, there has not been any event, change, occurrence or circumstance that has had or will have a Material Adverse Effect. For the avoidance of doubt, the representation made in clause (vi) above is made as of the date hereof and not as of the Closing Date.

5.7. Real Property . Subject to Sections 2.8 and 2.9, Schedule 5.7 sets forth all real property leased by Seller or a Subsidiary that will be transferred to Purchaser in accordance with the terms hereof (individually, a “ Transferred Lease ” and collectively, the “ Transferred Leases ”). Neither Seller nor any Subsidiary has received any notice of any default or there is no event that with notice or lapse of time, or both, that would constitute a default by Seller or any Subsidiary under any of the Transferred Leases which default (whether or not remedied) would result in the imposition upon Purchaser of any material Liability or material Business Restriction prior to the occurrence of such default.

5.8. Intellectual Property . Except as set forth on Schedule 5.8 , Seller and its Subsidiaries own or have valid licenses to use all Purchased Intellectual Property used by them in the Ordinary Course of Business, except to the extent the failure to be the owner or the valid licensee would not have a Material Adverse Effect. Except as set forth on Schedule 5.8 , (i) the Purchased Intellectual Property used by Seller and its Subsidiaries do not infringe on the intellectual property and other rights of any other Person and are not the subject of any challenge received by Seller or its Subsidiaries including any pending or, to the Knowledge of Seller, threatened Legal Proceeding relating thereto, which in each case, if adversely determined, would be likely to result in a Material Adverse Effect and (ii) neither Seller nor any Subsidiary has received any notice of any default or there is no event that with notice or lapse of time, or both, that would constitute a default under any material Purchased Intellectual Property license to which Seller or any Subsidiary is a party or by which it is bound.

5.9. Customer Contracts and Purchased Contracts . Except as set forth on Schedule 5.9 , neither Seller nor any Subsidiary are in default and no event has occurred that with notice or lapse of time or both would constitute a default by Seller or any Subsidiary under any Customer Contract with a Significant Customer or under any Purchased Contract, except for defaults that would not result in the imposition upon Purchaser of any material Liability or material Business Restriction. All Purchased Contracts and Customer Contracts are currently in full force and effect and neither Seller nor any Subsidiary has received notice that the other party thereto desires to terminate any such contract.

5.10. Employee Benefits . Schedule 5.10 lists all material “employee benefit plans”, as defined in Section 3(3) of ERISA, and all other material employee benefit arrangements or payroll practices, including, without limitation, bonus plans, consulting or other compensation agreements, incentive, equity or equity-based compensation, or deferred compensation

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arrangements, stock purchase, severance pay, sick leave, vacation pay, salary continuation, disability, hospitalization, medical insurance, life insurance, scholarship programs maintained by Seller and its Subsidiaries or to which Seller and its Subsidiaries contributed or is obligated to contribute thereunder for current or former Employees (the “ Employee Benefit Plans ”).

5.11. Litigation . Except as set forth on Schedule 5.11 , there are no Legal Proceedings pending or, to the Knowledge of Seller, threatened against Seller or any of its Subsidiaries, or to which Seller is otherwise a party before any Governmental Body related primarily to the Business. No Legal Proceedings, including those listed on Schedule 5.11 , has or will, if adversely determined, prevent Seller from consummating or performing, or has or will have an adverse affect on Seller’s ability to consummate the transactions or perform its obligations under this Agreement, or would result in the imposition upon Purchaser of any material Liability or any material Business Restriction. To the Knowledge of Seller, (i) there is no reasonable basis for any claim or Legal Proceeding against the Business to be brought by any other Person and (ii) there is no Order outstanding against, or relating to, any portion of the Business, which in each case would result in the imposition upon Purchaser of any material Liability or any material Business Restriction.

5.12. Compliance with Laws; Permits .

(a) Seller and its Subsidiaries are in material compliance with all Laws applicable to their respective operations and assets related to the Business. Neither Seller nor any of its Subsidiaries has received any notice of or, to the Knowledge of Seller, been charged with the violation of any Laws related to the Business.

(b) Seller and its Subsidiaries currently have all Permits which are required for the operation of the Business as presently conducted, except where the absence of which would not have a Material Adverse Effect. Neither Seller nor any of its Subsidiaries is in default or violation (and no event has occurred which, with notice or the lapse of time or both, would constitute a default or violation) of any term, condition or provision of any such Permit, except where such default or violation would not have a Material Adverse Effect.

5.13. Environmental Matters . Notwithstanding any other representation or warranty of Seller contained in this Agreement, the representations and warranties contained in this Section 5.13 are the sole and exclusive representations and warranties of Seller pertaining or relating to any environmental, health or safety matters, including any arising under any Environmental Laws. Except as set forth on Schedule 5.13 hereto and except in each case as would not have a Material Adverse Effect, with respect to the Business:

(a) the operations of the Business are in compliance with all applicable Environmental Laws;

(b) Seller and each of its Subsidiaries have obtained all Permits required under all applicable Environmental Laws necessary to operate the Business;

(c) neither Seller nor any of its Subsidiaries is the subject of any outstanding Order with any Governmental Body relating to the Business respecting (i) Environmental Laws, (ii) Remedial Action or (iii) any Release or threatened Release of a Hazardous Material;

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(d) neither Seller nor any of its Subsidiaries has received any communication alleging either or both that Seller or any of its Subsidiaries may be in violation of any Environmental Law, or any Permit issued pursuant to Environmental Law, or may have any liability under any Environmental Law, in each case with respect to the Business; and

(e) to the Knowledge of Seller, there are no investigations of the Business, or currently or previously owned, operated or leased property of Seller or any of its Subsidiaries relating to the Business pending or threatened which would reasonably be expected to result in the imposition of any material Liability pursuant to any Environmental Law.

5.14. Taxes . Except as provided on Schedule 5.14 :

(a) all material Tax Returns that were required to be filed by or with respect to any of Seller or its Subsidiaries and that related, in whole or in part, to the Business or any Purchased Assets, have been duly and timely filed and each such Tax Return was true, correct and complete in all material respects when filed;

(b) all material Taxes owed with respect to the Business and the Purchased Assets have been timely paid in full;

(c) all Tax withholding and deposit requirements imposed on or with respect to any of Seller and its Subsidiaries have been satisfied in all material respects;

(d) there is no written claim against any of Seller or its Subsidiaries for any material Taxes, and no assessment, deficiency or adjustment has been asserted or proposed in writing with respect to any material Tax Return of Seller or any of its Subsidiaries (to the extent such Tax Return relates to the Business or any Purchased Assets);

(e) none of the Assumed Liabilities includes, and none of the Purchased Assets is subject to, any obligation pursuant to any tax sharing agreement or any tax indemnification agreement;

(f) none of the Purchased Assets to be sold by a Subsidiary of Seller that is not a United States person (within the meaning of section 7701(a)(30) of the Code) is a United States real property interest (within the meaning of section 897(c) of the Code);

(g) none of the Purchased Assets is treated as an interest in a partnership for U.S. federal income Tax purposes; and

(h) to the Knowledge of Seller, no Governmental Body with which Seller or its Subsidiaries do not file Tax Returns has claimed in writing that any of Seller or its Subsidiaries is or may be subject to Taxes with respect to the Business or any of the Purchased Assets by that Governmental Body.

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5.15. Financial Advisors . No Person has acted, directly or indirectly, as a broker, finder or financial advisor for Seller or any of its Subsidiaries in connection with the transactions contemplated by this Agreement and no Person is entitled to any fee or commission or like payment in respect thereof.

5.16. Telecommunications Regulatory Matters . Except as set forth on Schedule 5.16 , no consent or approval of, or notification to, any state, federal or foreign regulatory body having jurisdiction over telecommunications matters is required solely in connection with the consummation by Seller of the transactions contemplated hereby.

5.17. No Other Representations or Warranties; Schedules . Except for the representations and warranties contained in this Article V (as modified by the Schedules hereto as supplemented or amended), neither Seller nor any other Person makes any other express or implied representation or warranty with respect to Seller, its Subsidiaries, the Business, the Purchased Assets, the Assumed Liabilities or the transactions contemplated by this Agreement, and Seller disclaims any other representations or warranties, whether made by Seller, any Affiliate of Seller or any of their respective officers, directors, employees, agents or representatives. Except for the representations and warranties contained in Article V hereof (as modified by the Schedules hereto as supplemented or amended), Seller (i) expressly disclaims and negates any representation or warranty, expressed or implied, at common law, by statute, or otherwise, relating to the condition of the Purchased Assets (including any implied or expressed warranty of merchantability or fitness for a particular purpose, or of conformity to models or samples of materials) and (ii) hereby disclaims all liability and responsibility for any representation, warranty, projection, forecast, statement, or information made, communicated, or furnished (orally or in writing) to Purchaser or its Affiliates or representatives including any information memorandum and related materials distributed to Purchaser in connection with a proposed transaction involving the Business (including any opinion, information, projection, or advice that may have been or may be provided to Purchaser by any director, officer, employee, agent, consultant, or representative of Seller or any of its Affiliates), except with respect to claims based or fraud, Intentional Misrepresentation or willful misconduct and violations of Laws by Seller or its Subsidiaries. Seller makes no representations or warranties to Purchaser regarding the probable success or profitability of the Business. The disclosure of any matter or item in any Schedule hereto shall not be deemed to constitute an acknowledgment that any such matter is required to be disclosed.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF PURCHASER

As of the date hereof and as of the Closing Date, Purchaser hereby represents and warrants to Seller that:

6.1. Organization and Good Standing . Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of New York and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now conducted.

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6.2. Authorization of Agreement . Purchaser has full corporate power and authority to execute and deliver this Agreement and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by Purchaser in connection with the consummation of the transactions contemplated hereby and thereby (the “ Purchaser Documents ”), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by Purchaser of this Agreement and each Purchaser Document have been duly authorized by all necessary corporate action on behalf of Purchaser. This Agreement has been, and each Purchaser Document will be at or prior to the Closing, duly executed and delivered by Purchaser and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Purchaser Document when so executed and delivered will constitute, the legal, valid and binding obligation of Purchaser, enforceable against Purchaser in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally.

6.3. Conflicts; Consents of Third Parties .

(a) Except as set forth on Schedule 6.3 , none of the execution and delivery by Purchaser of this Agreement or the Purchaser Documents, the consummation of the transactions contemplated hereby or thereby, or the compliance by Purchaser with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination or cancellation under any provision of (i) the certificate of incorporation and by-laws of Purchaser, (ii) any Contract or Permit to which Purchaser is a party or by which Purchaser or its properties or assets are bound or (iii) any Order of any Governmental Body applicable to Purchaser or by which any of the properties or assets of Purchaser are bound or (iv) any applicable Law.

(b) No consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any Person or Governmental Body is required on the part of Purchaser in connection with the execution and delivery of this Agreement or the Purchaser Documents, the compliance by Purchaser with any of the provisions hereof or thereof, the consummation of the transactions contemplated hereby or the taking by Purchaser of any other action contemplated hereby, or for Purchaser to conduct the Business.

6.4. Litigation . There are no Legal Proceedings pending or, to the knowledge of Purchaser, threatened against Purchaser, or to which Purchaser is otherwise a party before any Governmental Body, which, if adversely determined, would reasonably be expected to have a material adverse effect on the ability of Purchaser to perform its obligations under this Agreement or to consummate the transactions hereby. Purchaser is not subject to any Order of any Governmental Body except to the extent the same would not reasonably be expected to have a material adverse effect on the ability of Purchaser to perform its obligations under this Agreement or to consummate the transactions contemplated hereby.

6.5. Financial Advisors . Except for One Equity Partners LLC, no Person has acted, directly or indirectly, as a broker, finder or financial advisor for Purchaser in connection with the transactions contemplated by this Agreement and no Person is entitled to any fee or commission or like payment in respect thereof.

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6.6. Financial Capability . As of the date hereof, Purchaser has a commitment under its existing credit facility, as amended, from its senior lenders to provide loans to Purchaser to fund the Purchase Price, subject to the terms and conditions of its existing credit facility as amended. Purchaser has the financial resources and capability to perform its obligations hereunder and under the Ancillary Agreements to which it is a party; however, the foregoing representation and warranty in this sentence is made by Purchaser solely as of the Closing.

6.7. Condition of the Business . Notwithstanding anything contained in this Agreement to the contrary, Purchaser acknowledges and agrees that Seller is not making any representations or warranties whatsoever, express or implied, beyond those expressly given by Seller in Article V hereof (as modified by the Schedules hereto as supplemented or amended), and Purchaser acknowledges and agrees that, except for the representations and warranties contained therein, the Purchased Assets and the Business are being transferred on a “where is” and, as to condition, “as is” basis. Any claims Purchaser may have for breach of representation or warranty (other than based on fraud, Intentional Misrepresentation or willful misconduct of Seller) shall be based solely on the representations and warranties of Seller set forth in Article V hereof (as modified by the Schedules hereto as supplemented or amended). Purchaser further represents that neither Seller nor any of its Affiliates nor any other Person has made any representation or warranty, express or implied, as to the accuracy or completeness of any information regarding Seller or any of its Subsidiaries, the Business or the transactions contemplated by this Agreement not expressly set forth in this Agreement, and none of Seller, any of its Affiliates or any other Person will have or be subject to any liability to Purchaser or any other Person resulting from the distribution to Purchaser or its representatives or Purchaser’s use of, any such information, including any confidential memoranda distributed on behalf of Seller relating to the Business or other publications or data room information provided to Purchaser or its representatives, or any other document or information in any form provided to Purchaser or its representatives in connection with the sale of the Business and the transactions contemplated hereby.

ARTICLE VII

COVENANTS

7.1. Access to Information . Seller agrees that, prior to the Closing Date, Purchaser shall be entitled, through its officers, employees and representatives (including its legal and financial advisors, its lenders and their advisors, and its accountants), to make such investigation of the properties, businesses and operations of the Business and such examination of the books and records of the Business, the Purchased Assets and the Assumed Liabilities as it reasonably requests. Any such investigation and examination shall be conducted during regular business hours upon reasonable advance notice and under reasonable circumstances and shall be subject to (i) restrictions under applicable Law, (ii) compliance with the Network Security Agreement and (iii) any contractual restrictions applicable to Seller and its Subsidiaries, including Seller’s obligations under the Shared Contracts. Seller shall cause the officers, employees, consultants, agents, accountants, attorneys and other representatives of Seller and its Subsidiaries to cooperate with Purchaser and Purchaser’s representatives in connection with such investigation and examination, and Purchaser and its representatives shall cooperate with Seller and its representatives and shall use their reasonable efforts to minimize any disruption to the Business. Notwithstanding anything herein to the contrary, no such investigation or examination shall be

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permitted to the extent that it would require Seller or any of its Subsidiaries to disclose information subject to attorney-client privilege or conflict with any confidentiality obligations to which Seller or any of its Subsidiaries is bound. Notwithstanding anything to the contrary contained herein, prior to the Closing, all Purchaser contact with suppliers and customers of the Business shall be in accordance with the Management Agreement.

7.2. Conduct of the Business Pending the Closing .

(a) Prior to the Closing, except (I) as set forth on Schedule 7.2 , (II) as required by applicable Law, (III) as otherwise contemplated by this Agreement, the Transition Services Agreement or the Management Agreement, or (IV) with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), Seller shall, and shall cause its Subsidiaries to:

(i) conduct the Business only in the Ordinary Course of Business in substantially the same manner as the Business has been operated prior to the date hereof and since January 1, 2004, including compliance with all Laws;

(ii) maintain its books and records in the usual, regular and ordinary manner, on a basis consistent with past practice; and

(iii) use its commercially reasonable efforts, without changing the Ordinary Course of Business, to (A) preserve the present business operations, organization and goodwill of the Business, (B) preserve and maintain such assets and properties it owns as is material to the Business, and (C) preserve the present relationships with customers and suppliers of Seller and its Subsidiaries.

(b) Within three (3) Business Days after the date hereof, Seller and Purchaser shall each designate working teams (the “ Working Teams ”) who shall be responsible for (i) managing the 80 Pine Relocation and the migration of the facilities of Seller related to the Business from the Worship Street, London location (the “ Worship Street Relocation ”, and together with the 80 Pine Relocation, the “ Relocations ”), and (ii) transitioning the Business from Seller to Purchaser during the period from the date of this Agreement to Closing (the “ Transition ”). The final and successful completion of the Relocations shall be subject to the prior approval of Purchaser in its sole and reasonable discretion. Such Relocations shall be subject to the performance service levels and time frames set forth in the Transition Services Agreement. Seller Working Team members and Purchaser Working Team members shall provide each other with such access, information and input as necessary to determine the most efficient manner in which to complete the Relocations as soon as practicable following the Closing.

(c) Without limiting the generality of the foregoing, except as expressly contemplated by this Agreement or as set forth on Schedule 7.2 , between the date of this Agreement and the Closing Date, each of Seller and Purchaser shall not, and shall not permit its Subsidiaries to, take any action that is reasonably likely to result in (A) any of the representations and warranties set forth in Article V or Article VI , as applicable, becoming false or inaccurate in any material respect or (B) the failure of any of the conditions set forth in Article IX to be satisfied.

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7.3. Communication with Government Bodies . Each of the Purchaser and Seller shall use its commercially reasonable efforts to furnish to each other all information required for any application or other filing to be made pursuant to any applicable Law in connection with the transactions contemplated by this Agreement. Each such party shall promptly inform the other parties hereto of any oral communication with, and provide copies of written communications with, any Governmental Body regarding any such filings or any such transaction. No party hereto shall independently participate in any formal meeting with any Governmental Body in respect of any such filings, investigation, or other inquiry without giving the other parties hereto prior notice of the meeting and, to the extent permitted by such Governmental Body, the opportunity to attend and/or participate. The parties hereto will consult and cooperate with one another in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto relating to any of the foregoing matters. Such materials and the information contained therein shall be given only to the outside legal counsel of the recipient and will not be disclosed by such outside counsel to employees, officers, or directors of the recipient, unless express written permission is obtained in advance from the source of the materials. Notwithstanding the foregoing, in the event of any Threatened Regulatory Prohibition, Seller and Purchaser shall cooperate with each other and the Governmental Bodies which have initiated the Threatened Regulatory Prohibition to promptly resolve and respond to any Threatened Regulatory Prohibition.

7.4. Consents . Subject to Section 2.5(c) hereof, Seller shall use, and, as applicable, shall cause each of its Subsidiaries to use, its commercially reasonable efforts, and Purchaser shall cooperate with Seller, to obtain at the earliest practicable date either prior to or after the Closing Date all consents and approvals necessary to transfer and assign to Purchaser or its assigns the Purchased Assets, including those consents and approvals set forth on Schedule 5.3(b) ; provided , however , that such efforts shall not require Seller or any of its Affiliates to incur any significant expenses or Liabilities or provide any financial accommodation or to remain secondarily or contingently liable for any Assumed Liability to obtain any such consent or approval and such obligations of Seller and its Subsidiaries shall terminate on the one year anniversary of the date of this Agreement.

7.5. Further Assurances . Each of Seller and Purchaser shall use its reasonable best efforts to (i) take, or cause to be taken, all actions necessary or appropriate to consummate the transactions contemplated by this Agreement, (ii) at the request of the other party, execute and deliver any instruments or documents in order to effectuate the provisions and purposes of this Agreement, the Seller Documents or the Purchaser Documents and (iii) cause the fulfillment at the earliest practicable date of all of the conditions to consummate the transactions contemplated by this Agreement.

7.6. Confidentiality . Purchaser acknowledges that the information provided to it in connection with this Agreement and the transactions contemplated hereby is subject to the terms of the confidentiality agreement between Purchaser and Seller (or their respective Affiliates) dated June 7, 2004 (the “ Confidentiality Agreement ”), the terms of which are incorporated

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herein by reference. Effective upon, and only upon, the Closing Date, the Confidentiality Agreement shall terminate with respect to information relating solely to the Business or otherwise included in the Purchased Assets; provided , however , that Purchaser acknowledges that (i) any and all other Confidential Information provided to it by Seller or its representatives concerning Seller and its Subsidiaries not related to the Business shall remain subject to the terms and conditions of the Confidentiality Agreement after the Closing Date and (ii) all other provisions of the Confidentiality Agreement shall remain in full force and effect after the Closing Date.

7.7. Preservation of Records . Seller and Purchaser agree that each of them shall preserve and keep the records held by it or their Affiliates relating to the Business (other than attendance records of Transferred Employees and marketing records) for a period of six (6) years from the Closing Date and shall make such records and personnel available to the other as may be reasonably required by such party in connection with, among other things, any insurance claims by, Legal Proceedings or tax audits against or governmental investigations of Seller or Purchaser or any of their Affiliates or in order to enable Seller or Purchaser to comply with their respective obligations under this Agreement and each other agreement, document or instrument contemplated hereby or thereby. If Seller or Purchaser wishes to destroy such records after that time, such party shall first give ninety (90) days prior written notice to the other and such other party shall have the right at its option and expense, upon prior written notice given to such party within that ninety (90) day period, to take possession of such records within one hundred and eighty (180) days after the date of such notice.

7.8. Publicity . Neither Seller nor Purchaser shall issue any press release or public announcement concerning this Agreement or the transactions contemplated hereby without obtaining the prior written approval of the other party hereto, which approval will not be unreasonably withheld or delayed, unless, in the sole judgment of Purchaser or Seller, disclosure is otherwise required by applicable Law or by the applicable rules of any stock exchange on which Purchaser or Seller lists securities, provided that, to the extent required by applicable Law, the party intending to make such release shall use its commercially reasonable efforts consistent with such applicable Law to consult with the other party with respect to the text thereof. In any such release or disclosure the parties shall not disclose price or valuation with respect to the transaction, except as required by applicable Law, in connection with financing transactions or if required in connection with any filings made by Seller or any of its Affiliates with the Securities and Exchange Commission or any national securities exchange after consultation with Purchaser.

7.9. Use of Name . From and after the Closing Date, Purchaser shall not, and shall cause its subsidiaries not to represent to any Person that Purchaser or any of its subsidiaries is affiliated with Seller or any of its Affiliates. Within thirty (30) days after the Closing Date, Purchaser shall, and shall cause its Subsidiaries, to cease using the name “ Global Crossing ” or any variation thereof, or any trademarks, trade names, logos or symbols owned by Seller or any of its Subsidiaries (other than any of the foregoing included in the Purchased Assets), or any trademark, trade name, logo or symbol confusingly similar to any of the foregoing, in relation to any of their respective products or services or in the conduct of their respective businesses.

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7.10. Customer Credits; Disconnect Orders; Service Issues .

(a) (i) Subject to Section 7.10(a)(ii) , at Seller’s option, Seller shall pay, or promptly indemnify Purchaser for, all valid credits and revenue write-downs claimed or requested by customers with respect to goods or services provided by Seller prior to the Closing, whether such claims or requests are made prior to or subsequent to the Closing, including any such credits and revenue write-downs which would apply to any period from and after the Effective Time of the Closing. In the event that, following the Closing, a customer shall request a credit or revenue write-down, Purchaser will consult with Seller prior to committing to such credit or revenue write-down relating to goods or services provided by Seller prior to the Closing; however, the obligation of Seller under the preceding sentence shall be applicable whether or not Seller concurs that any such credit or revenue write-down is reasonable or warranted, subject to the right of Seller to dispute the validity of such credit or revenue write-down, in accordance with the provisions of Section 11.3 .

(ii) (A) Without limiting the obligations of Seller under Section 7.10(a) , Purchaser shall fund or absorb any credit or revenue write-down in an amount equal to $50,000 or less; provided that Purchaser will consult with Seller prior to committing to such credit or revenue write-down relating to goods or services provided by Seller prior to the Closing. However, Purchaser shall, subject to the right of Seller to dispute the validity of such credit or write-down in accordance with Section 11.3 , be entitled to indemnification from Seller as provided in Section 7.10(a) and shall be entitled to make claims against the Indemnity Escrow Amount (without limiting any right of Purchaser to assert any indemnification claim against Seller).

(B) In the event that Seller shall fail promptly to pay or reimburse any credit or revenue write-down in an amount in excess of $50,000, Purchaser shall be entitled to indemnification from Seller as provided in Section 7.10(a) and shall be entitled to make claims against the Indemnity Escrow Amount (without limiting any right of Purchaser to assert any indemnification claim against Seller). If Purchaser shall request a distribution and release from the Indemnity Escrow Amount with respect thereto, Seller shall not be entitled to object to such distribution and release to Purchaser, and Seller shall promptly deposit in the Indemnity Escrow Amount funds sufficient to replenish the amount which has been distributed or released to Purchaser. However, if the Seller disputes the credit or revenue write-down pursuant to Section 7.10(a)(i) , any obligation of Seller to replenish the Indemnity Escrow Amount as aforesaid shall be deferred until a final determination, in accordance with the provisions of Section 11.3 , is made with respect to such dispute.

(C) In the event that a Determination in Favor of Seller (as defined in the Escrow Agreement) is made that Seller is not obligated to pay or indemnify Purchaser in respect of any credit or revenue write-down which Seller has paid or with respect to which a distribution or release has been made from the Indemnity Escrow Amount, then Purchaser shall reimburse Seller or replenish the Indemnity Escrow Amount, as applicable, by the amount of such credit or revenue write-down for which it has been determined that Seller is not responsible.

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(b) Seller shall promptly inform Purchaser if, after the date hereof, it receives any Disconnect Order from a Significant Customer of the Business prior to the Closing Date.

(c) Seller shall promptly notify the Purchaser of any claims against Seller brought by any third party in respect of any goods or services supplied by Seller in connection with the Business prior to Closing. Seller agrees to consult with Purchaser as to the proposed action which the Seller intends to take to resolve or dispute such claim and shall use commercially reasonable efforts in taking any such action not to damage the goodwill of the Business. Likewise if any such third party brings a claim against Purchaser in respect of any goods or services supplied by Seller or Purchaser pursuant to the Management Agreement in connection with the Business prior to Closing, Purchaser shall promptly notify Seller of such claim and the parties shall follow the prior sentences of this paragraph in resolving such claim. Nothing in this paragraph is meant to relieve Seller of its obligations under Section 7.10(a), but is meant solely to set forth a procedure with respect to goods or services supplied to customers and to prevent the damage to the goodwill of the Business and the relationship of Seller and Purchaser with customers and suppliers of the Business.

7.11. Certain Commercial Arrangements . Seller and Purchaser agree, on or prior to the Closing Date and effective as of the Closing Date, to enter into, or to cause their Subsidiaries or Affiliates to enter into, commercial arrangements to be set forth in definitive documentation with respect to each of the following:

(a) an agreement with respect to colocation services, private line services and other specified services to be provided by Seller to Purchaser, in the form attached hereto as Exhibit B (the “ Seller Master Services Agreement ”); and

(b) an agreement with respect to colocation services to be provided by Purchaser to Seller that will reflect the same terms and conditions as colocation services are provided by Seller to Purchaser under the Seller Master Services Agreement (the “ Purchaser Master Services Agreement ”).

7.12. MCI Access Arrangements .

(a) If MCI has not applied the terms and conditions, including costs of circuits, of the Purchaser MCI Agreement to the Assumed Circuits (as defined in the MCI Assignment and Assumption Agreement) to be transferred by Seller to Purchaser at Closing prior to the 62nd day following the Closing Date, Seller agrees to pay Purchaser up to $[**] per month (and for partial months on a pro-rated basis) from the 62nd day through the date in the MCI Assignment and Assumption Agreement on which MCI agrees to apply Purchaser’s pricing for its cost of access for purchased circuits from MCI.

(b) In addition to the payment under Section 7.12(a), until the first anniversary of the Closing Date, Seller agrees to reimburse Purchaser for its actual third party cost of access in excess of $[**] per month (the “ Monthly Access Cost Cap ”) for all circuits included in the Purchased Assets (including the Assumed Circuits after giving effect to any re-rates to such circuits provided by MCI) transferred or required to be transferred by Seller and its Subsidiaries to Purchaser at Closing to the extent used in the operation of the Business.

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7.13. Non-Competition Agreement .

(a) For a period of three (3) years following the Closing Date, Seller shall not, and shall cause its Subsidiaries not to, provide any voice telephony services between dealer boards (i.e., turrets) to any business customers in the financial services market (the “ Restricted Activities ”).

(b) The provisions of Section 7.13(a) shall terminate immediately upon a Change of Control. For the avoidance of doubt, the provisions of Section 7.13(a) shall not terminate upon the recapitalization or corporate reorganization of Seller, its Subsidiaries or its Affiliates.

7.14. Circuit Inventory . At the Closing, Seller shall deliver to Purchaser an electronic excel database of circuit inventory containing all applicable details then available such as routing, local access identification numbers, names of carriers and demarc information (the “ Circuit Inventory Database ”). To the extent that any such details are not available as of the Closing, Seller shall provide to Purchaser additional details (if any) with respect to the Circuit Inventory Database as soon as practicable after the Closing.

7.15. Management Agreement . Concurrently with the execution of this Agreement, Seller and Purchaser shall enter into the Management Agreement, pursuant to which Purchaser shall manage the Business from and after the date hereof in accordance with the terms and conditions set forth in the Management Agreement.

7.16. Monthly Financial Data . Prior to Closing, Seller shall deliver to Purchaser, as soon as possible after it becomes available and in no event later than the 15th day after any month end, additional monthly financial data of the Business, comparable to the financial data described in Sections 5.4(a)(i), 5.4(a)(ii) and 5.4(a)(iii) hereof (the “ Additional Monthly Financial Data ”). If the Closing occurs prior to the 15th day after a month end and such comparable financial data is not then available, Seller will provide to Purchaser at Closing the financial data that is then available, including data on customer invoices that have been sent out at such month end (the “ Available Financial Data ”), and Seller will certify at Closing that the Available Financial Data has been prepared in good faith based on the books and records of the Business.

ARTICLE VIII

EMPLOYEES AND EMPLOYEE BENEFITS

8.1. Employment .

(a) Transferred Employees . Seller shall permit, and shall cause its Subsidiaries to permit, Purchaser to interview such employees of the Business as Purchaser shall request and to engage in discussions with such employees regarding potential employment by Purchaser following the Closing and the terms thereof. At least ten (10) days prior to the Closing Date, Purchaser shall identify, and notify Seller in writing of, those non-UK Employees of the Business it intends to make offers of employment in order to continue to employ such persons in the Business subsequent to the Closing (the “ Employee List ”). Prior to the Closing, Purchaser shall deliver, in writing, an offer of employment to each such Employee who remains employed

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immediately prior to the Closing to commence immediately following the Closing. Such individuals who accept such offer of employment effective as of the Closing Date and who report to active employment on the first Business Day following the Closing Date are hereinafter referred to as the “ Transferred Employees .” For purposes of Section 8.2, any reference to the “Transferred Employees” or a “Transferred Employee” shall include the UK Transferred Employees, as applicable. Any employment of a Transferred Employee as aforesaid shall be solely “at will” and, subject to Section 8.2(a), on such terms and conditions as Purchaser may elect; and Purchaser shall have no obligation to continue any employment of a Transferred Employee subsequent to the Closing.

(b) Standard Procedure . Pursuant to the “ Standard Procedure ” provided in section 5 of Revenue Procedure 96 60, 1996 2 C.B. 399, (i) Purchaser and Seller shall report on a predecessor/successor basis as set forth therein, (ii) Seller will not be relieved from filing a Form W 2 with respect to any Transferred Employees, and (iii) Purchaser will undertake to file (or cause to be filed) a Form W 2 for each such Transferred Employee with respect to the portion of the year during which such Employees are employed by Purchaser that includes the Closing Date, excluding the portion of such year that such Employee was employed by Seller or its Subsidiaries.

8.2. Employee Benefits .

(a) Benefits . Purchaser shall provide compensation and benefits to the Transferred Employees on substantially the same basis or terms as Purchaser provides to similarly situated employees of Purchaser, which compensation and benefits may be lesser than that which any Transferred Employee may be currently receiving.

(b) For purposes of eligibility and vesting (but not benefit accrual) under any employee benefit plans of Purchaser providing benefits to Transferred Employees (the “ Purchaser Plans ”), Purchaser shall credit each Transferred Employee with his or her years of service with Seller, its Subsidiaries and any predecessor entities, to the same extent as such Transferred Employee was entitled immediately prior to the Closing to credit for such service under any similar Employee Benefit Plan. The Purchaser Plans shall not, subject to the requirements of any third party provided plan or arrangement, deny Transferred Employees coverage on the basis of pre-existing conditions and shall credit such Transferred Employees for any deductibles and out-of-pocket expenses paid in the year of initial participation in the Purchaser Plans.

(c) Nothing contained in this Section 8.2 or elsewhere in this Agreement shall be construed to prevent the termination of employment of any individual Transferred Employee or any change in the employee benefits available to any individual Transferred Employee.

(d) Notwithstanding anything contained herein to the contrary, Seller and its Subsidiaries shall be responsible for all Liabilities with respect to employees and Transferred Employees attributable to their accrued and accruable compensation (including salary, wages, commissions, bonuses, incentive pay, overtime and premium pay) employee benefits, vacation, sick days and personal days (collectively, “ Accrued Employee Benefits ”) prior to Closing. Seller hereby acknowledges that it and its Subsidiaries shall be solely responsible for the

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payment of such Accrued Employee Benefits in respect of any period or partial period ending prior to Closing. Similarly, Purchaser shall be responsible for all such Accrued Employee Benefits with respect to the Transferred Employees accruing solely with respect to periods of their employment by Purchaser from and after the Closing.

8.3 [**] 2.5 pages omitted pursuant to the confidential treatment request.

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ARTICLE IX

CONDITIONS TO CLOSING; DELIVERIES AT CLOSING

9.1. Conditions Precedent to Obligations of Purchaser and Seller . The obligations of Purchaser and Seller to consummate the transactions contemplated by this Agreement is subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived by Purchaser in whole or in part to the extent permitted by applicable Law):

(a) the receipt of the Regulatory Approvals;

(b) the absence of any Actual Regulatory Prohibition or any Threatened Regulatory Prohibition;

(c) [omitted]

(d) Seller shall have effected the Seller Closing Deliveries, and Purchaser shall have effected the Purchaser Closing Deliveries;

(e) the MCI Assignment and Assumption Agreement shall be in full force and effect; and

(f) no voluntary or involuntary federal, state or foreign bankruptcy, reorganization, insolvency, moratorium or similar proceeding shall have been commenced by or against Seller or its Subsidiaries or with respect to the Purchased Assets or the Business and such proceeding is then pending.

9.2. Seller Closing Deliveries . At the Closing, Seller shall deliver, or cause to be delivered, to Purchaser the following (the “ Seller Closing Deliveries ”):

(a) a duly executed Bill of Sale and Assignment and Assumption Agreement in the form of Exhibit A hereto (the “ Bill of Sale and Assignment and Assumption Agreement ”), and Seller or its Subsidiaries shall deliver to Purchaser or its assigns and all of the Purchased Assets free and clear of all Liens except for Permitted Exceptions;

(b) the Escrow Agreement, the Seller Master Services Agreement and the Purchaser Master Services Agreement;

(c) a non-exclusive, royalty free license to use the SCORE system in the form attached hereto as Exhibit D ;

(d) an officer’s certificate signed by an authorized officer of Seller’s parent company, Global Crossing Limited, a Bermuda company, reasonably satisfactory to Purchaser certifying that: (i) the annual net revenue of the Business, as adjusted for customer credits, as of January 31, 2005 was at least $[**] based on the annualized revenue for January 2005 and (ii) the Available Financial Data has been prepared in good faith based on the books and records of the Business;

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(e) the Management Fee under the Management Agreement, unless Purchaser elects to reduce the Purchase Price by the Management Fee in accordance with Section 3.1 of the Management Agreement and Section 9.3(a) hereof; and

(f) cost of access reduction plans with respect to the circuits included in the Purchased Assets, in form, substance and detail consistent with the cost of access reduction plan for Atlanta heretofore provided by Seller to Purchaser, and reasonably satisfactory to Purchaser demonstrating that Purchaser will have monthly cost of access of not more than $[**] after giving effect to disconnects to be made on or before of July 31, 2005.

9.3. Purchaser Closing Deliveries . At the Closing, Purchaser shall deliver, or cause to be delivered, to Seller the following (the “ Purchaser Closing Deliveries ”):

(a) the Purchase Price, less the Indemnity Escrow Amount, the TSA Escrow Amount and (if Purchaser elects to reduce the Purchase Price by the Management Fee in accordance with Section 3.1 of the Management Agreement) the Management Fee, and evidence of the wire transfer thereof;

(b) the duly executed Bill of Sale and Assignment and Assumption Agreement; and

(c) Escrow Agreement, the Seller Master Services Agreement and the Purchaser Master Services Agreement.

9.4. Frustration of Closing Conditions . Neither Seller nor Purchaser may rely on the failure of any condition set forth in Section 9.1 if such failure was caused by such party’s failure to comply with any provision of this Agreement or any of the Ancillary Agreements.

ARTICLE X

INDEMNIFICATION

10.1. Survival of Representations and Warranties . The representations and warranties of the parties contained in this Agreement shall survive the Closing and claims may be asserted with respect thereto to the extent permitted by this Article X; provided, however, that (i) with respect to claims for indemnification asserted or assertable directly by an indemnified party hereunder (other than claims for indemnification asserted or assertable based on Third Party Claims), such representations and warranties shall terminate as of the close of business on the date that is one year after the Closing Date and (ii) with respect to claims asserted or assertable by an indemnified party for indemnification because of a claim asserted by any claimant other than an indemnified person hereunder based on claims asserted or assertable by any other Person against Seller or Purchaser or their respective Affiliates (including any creditor of or holder of a claim against Seller or its Subsidiaries and any other Person holding a claim based on any Excluded Liability) (a “ Third Party Claim ”), such representations and warranties shall terminate as of the close of business on the date that is three years after the Closing Date. Claims under

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Sections 10.2(a)(i) and 10.2(a)(ii) in respect of any Excluded Liability described in subclause (i)(B) of the second sentence of Section 2.4 shall terminate as of the close of business on the date that is three years after the Closing Date if not asserted prior to that date. Notwithstanding the foregoing, the representations and warranties contained in Section 5.1, Section 5.2, the first sentence of Section 5.5, Section 6.1, Section 6.2 and any claim based on fraud, Intentional Misrepresentation or willful misconduct by any of Seller or its Subsidiaries or Purchaser shall survive the Closing and remain in effect indefinitely, and the representations and warranties contained in Section 5.14 shall survive the Closing and remain in effect until ninety (90) days after the expiration of the applicable statute of limitations. The expiration of any representation and warranty as aforesaid shall not affect any separate obligation set forth in this Article X of the Parties under this Agreement or the Ancillary Agreements to indemnify each other with respect the breach of a covenant or the assumption or retention of an Assumed Liability or an Excluded Liability, as the case may be, to the matter which is the subject of such representation and warranty.

10.2. Indemnification by Seller .

(a) Subject to Sections 10.1 and 10.5 hereof, Seller hereby agrees to indemnify and hold Purchaser and its directors, officers, employees, Affiliates, stockholders, agents, attorneys, representatives, successors and permitted assigns (collectively, the “ Purchaser Indemnified Parties ”) harmless from and against the following incurred by, imposed upon or sought to be imposed upon Purchaser:

(i) any and all losses, liabilities, obligations and damages (including consequential, incidental, indirect, special and punitive damages) (individually, a “ Loss ” and, collectively, “ Losses ”) based upon or arising from any breach of the representations, warranties, covenants or agreements made by Seller in this Agreement; however, the indemnification obligations of Seller with respect to any Excluded Liability described in subclause (i)(B) of the second sentence of Section 2.4 shall be subject to the limitations set forth in Section 10.5

(ii) all Excluded Liabilities and all Losses based upon or arising from any Excluded Asset or any Excluded Liability, including if and to the extent that any third-party shall seek to impose any Excluded Liability upon Purchaser Indemnified Parties; however, the indemnification obligations of Seller with respect to any Excluded Liability described in subclause (i)(B) of the second sentence of Section 2.4 shall be subject to the limitations set forth in Section 10.5 .

(iii) any and all notices, actions, suits, proceedings, claims, demands, assessments, judgments, costs, penalties and expenses, including attorneys’ and other professionals’ fees and disbursements (collectively, “ Expenses ”) incurred by Purchaser Indemnified Parties incident to any and all Losses or Excluded Liabilities with respect to which indemnification is provided hereunder; and

(iv) the cost of access paid by Purchaser with respect to third party circuits that do not constitute Purchased Assets and that are erroneously transferred or billed to Purchaser at Closing, to the extent that the total cost of access to Purchaser for

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all third party circuits correctly transferred to Purchaser and all such erroneously transferred circuits exceeds an aggregate of $[**] per month and provided that Seller has not otherwise reimbursed Purchaser for such cost of access for erroneously transferred circuits; however, the foregoing limitation shall be inapplicable (A) if Seller is in breach of its obligations under Section 7.12 , (B) subsequent to the first anniversary of the Closing Date, or (C) prospectively from and after such erroneously transferred or billed circuits are discovered.

10.3. Indemnification by Purchaser . Subject to Sections 10.1 and 10.5 , Purchaser hereby agrees to indemnify and hold Seller and its directors, officers, employees, Affiliates, agents, attorneys, representatives, successors and permitted assigns (collectively, the “ Seller Indemnified Parties ”) harmless from and against:

(i) any and all Losses based upon or arising directly from any breach of the representations, warranties, covenants or agreements made by Purchaser in this Agreement;

(ii) all Assumed Liabilities and any and all Losses based upon or arising directly out of any Assumed Liability, including if and to the extent that any third-party shall seek to impose any Assumed Liability upon Seller Indemnified Parties;

(iii) any and all Losses based upon or arising directly out of any Purchased Asset or the operation of the Business after the Closing Date, other than with respect to Excluded Liabilities; and

(iv) any and all Expenses incident to any and all Losses or Assumed Liabilities with respect to which indemnification is provided hereunder.

10.4. Indemnification Procedures .

(a) In the event that any Legal Proceedings shall be instituted or that any claim or demand shall be asserted by any Person in respect of which payment may be sought under Section 10.2 and 10.3 hereof (regardless of the limitations set forth in Section 10.5 ) (an “ Indemnification Claim ”), the indemnified party shall reasonably and promptly cause written notice of the assertion of any Indemnification Claim of which it has knowledge which is covered by this indemnity to be forwarded to the indemnifying party. The indemnifying party shall have the right, at its sole option and expense, to be represented by counsel of its choice, which must be reasonably satisfactory to the indemnified party, and to defend against, negotiate, settle or otherwise deal with any Indemnification Claim which relates to any Losses indemnified against hereunder. If the indemnifying party elects to defend against, negotiate, settle or otherwise deal with any Indemnification Claim which relates to any Losses indemnified against hereunder, it shall within thirty (30) days (or sooner, if the nature of the Indemnification Claim so requires) notify the indemnified party of its intent to do so. If the indemnifying party elects not to defend against, negotiate, settle or otherwise deal with any Indemnification Claim which relates to any Losses indemnified against hereunder, the indemnified party may defend against, negotiate, settle or otherwise deal with such Indemnification Claim. If the indemnifying party shall assume the defense of any Indemnification Claim, the indemnified party may participate, at his or its

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own expense, in the defense of such Indemnification Claim; provided , however , that such indemnified party shall be entitled to participate in any such defense with separate counsel at the expense of the indemnifying party if (i) so requested by the indemnifying party to participate or (ii) in the reasonable opinion of counsel to the indemnified party a conflict or potential conflict exists between the indemnified party and the indemnifying party that would make such separate representation advisable; and provided , further , that the indemnifying party shall not be required to pay for more than one such counsel for all indemnified parties in connection with any Indemnification Claim. The parties hereto agree to cooperate fully with each other in connection with the defense, negotiation or settlement of any such Indemnification Claim. Notwithstanding anything in this Section 10.4 to the contrary, neither the indemnifying party nor the indemnified party shall, without the written consent of the other party, settle or compromise any Indemnification Claim or permit a default or consent to entry of any judgment unless the claimant and such party provide to such other party an unqualified release from all liability in respect of the Indemnification Claim. Notwithstanding the foregoing, if a settlement offer solely for money damages is made by the applicable third party claimant, and the indemnifying party notifies the indemnified party in writing of the indemnifying party’s willingness to accept the settlement offer and, subject to the applicable limitations of Sections 10.5 and 10.6 , pay the amount called for by such offer, and the indemnified party declines to accept such offer, the indemnified party may continue to contest such Indemnification Claim, free of any participation by the indemnifying party, and the amount of any ultimate liability with respect to such Indemnification Claim that the indemnifying party has an obligation to pay hereunder shall be limited to the lesser of (A) the amount of the settlement offer that the indemnified party declined to accept plus the Losses of the indemnified party relating to such Indemnification Claim through the date of its rejection of the settlement offer or (B) the aggregate Losses of the indemnified party with respect to such Indemnification Claim. If the indemnifying party makes any payment on any Indemnification Claim, the indemnifying party shall be subrogated, to the extent of such payment, to all rights and remedies of the indemnified party to any insurance benefits or other claims of the indemnified party with respect to such Indemnification Claim

(b) After any final decision, judgment or award shall have been rendered by a Governmental Body of competent jurisdiction and the expiration of the time in which to appeal therefrom, or a settlement shall have been consummated, or the indemnified party and the indemnifying party shall have arrived at a mutually binding agreement with respect to an Indemnification Claim hereunder, the indemnified party shall forward to the indemnifying party notice of any sums due and owing by the indemnifying party pursuant to this Agreement with respect to such matter.

10.5. Certain Limitations on Indemnification .

(a) Notwithstanding anything herein to the contrary, an indemnified party must give notice to an indemnifying party of any Indemnification Claim in respect of a breach of a representation or warranty hereunder in writing in reasonable detail prior to the expiration of the applicable period, if any, specified in Section 10.1. Any such Indemnification Claim not made by an indemnified party on or prior to that date will be irrevocably and unconditionally released and waived.

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(b) Notwithstanding the provisions of this Article X , neither Seller nor Purchaser shall have any indemnification obligations for Losses under this Article X based solely on any breach of the representations and warranties set forth in this Agreement, or any indemnification obligation with respect to any Excluded Liability described in subclause (i)(B) of the second sentence of Section 2.4 , (i) for any individual item where the Loss relating thereto is less than $25,000 and (ii) in respect of each individual item where the Loss relating thereto is equal to or greater than $25,000, unless the aggregate amount of all such Losses exceeds $100,000, and, in such event, the indemnifying party shall be required to pay the entire amount of such Losses and Expenses (including any Losses under the foregoing clause (i)). In no event shall the aggregate indemnification under this Article X solely in respect of breaches of the representations and warranties set forth in this Agreement and any Excluded Liability described in subclause (i)(B) of the second sentence of Section 2.4 , to be paid by (i) Seller exceed $6.25 million in the aggregate, and (ii) Purchaser exceed $1.0 million in the aggregate or, in the case of a breach of Purchaser’s representations and warranties contained in Section 6.6, $25 million in the aggregate; provided , however , the foregoing limitations shall not be applicable with respect to any claim (A) in respect of the representations and warranties contained in Section 5.1, Section 5.2, the first sentence of Section 5.5, Section 6.1 and Section 6.2, (B) based on a breach of the covenants of Seller or Purchaser contained herein, (C) based on fraud, Intentional Misrepresentation, willful misconduct or violations of Law by Seller or its Subsidiaries or Purchaser or (D) in respect of the obligation of Seller to indemnify Purchaser for Excluded Liabilities or the obligation of Purchaser to indemnify Seller for Assumed Liabilities under this Article X .

10.6. Indemnity Escrow . On the Closing Date, Purchaser, on behalf of the Selling Subsidiaries, shall pay to the Escrow Agent in immediately available funds, in a separately identified account (apart from the TSA Escrow Amount) designated by the Escrow Agent, an amount equal to $2,000,000 (the “ Indemnity Escrow Amount ”), in accordance with the terms of this Agreement and the Escrow Agreement. Any payment Seller is obligated to make to any Purchaser Indemnified Parties pursuant to this Article X shall be paid first from the Indemnity Escrow Amount. On each of the first and second anniversaries of the Closing Date, the Indemnity Escrow Agent shall release $500,000 of the Indemnity Escrow Amount to Seller, provided that, if one or more claims for indemnification are then pending or have been asserted, the amount of the escrow that shall be released to Seller at each such time shall be an amount equal to the difference between $500,000 and the amount of all such claims then pending or asserted which have not been reserved against by retaining prior escrow amounts. On the third anniversary of the Closing Date, the Escrow Agent shall release the remainder (if any) of the Indemnity Escrow Amount to Seller, except that the Escrow Agent shall retain an amount equal to the amount of claims for indemnification under this Article X asserted prior to such 3 year anniversary but not yet resolved (“ Unresolved Claims ”). The Indemnity Escrow Amount retained for Unresolved Claims shall be released by the Indemnity Escrow Agent (to the extent not utilized to pay Purchaser for any such claims resolved in favor of Purchaser) upon their resolution in accordance with this Article X . The Indemnity Escrow Amount shall constitute collateral security for the obligations of Seller under this Article X; and the Escrow Agent shall, pursuant to the Escrow Agreement, agree to act as collateral agent for Purchaser.

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10.7. Calculation of Losses .

(a) The amount of any Losses for which indemnification is provided under this Article X shall be net of any amounts actually recovered by the indemnified party under insurance policies or otherwise with respect to such Losses (net of any Tax or expenses incurred in connection with such recovery).

(b) If, notwithstanding the treatment required by Section 10.8, the amount of any Loss for which indemnification is provided under this Article X gives rise to a currently realizable Tax benefit (as defined below) to the Indemnified Party making the Indemnification Claim, then the Indemnification Claim shall be (i) increased to take account of any net Tax cost incurred by the indemnified party arising from the receipt of indemnity payments hereunder (grossed up for such increase) and (ii) reduced to take account of any net Tax benefit realized by the indemnified party arising from the incurrence or payment of any such Loss. To the extent such Indemnification Claim does not give rise to a currently realizable Tax benefit, if, notwithstanding the treatment required by Section 10.8, the amount with respect to which any Indemnification Claim is made gives rise to a subsequently realized Tax benefit to the indemnified party that made the Indemnification Claim, such indemnified party shall refund to the indemnifying party the amount of such Tax benefit (with and including any gross-up payment made pursuant to this Section 10.7 with respect to such Tax benefit) when, as and if realized (it being understood that such indemnified party shall use its reasonable efforts to realize such Tax benefit). For purposes of this Section 10.7 , a “ Tax benefit ” means an amount by which the Tax liability of the party (or group of corporations including the party) is actually reduced (including by deduction, reduction of income by virtue of increased tax basis or otherwise, entitlement to refund, credit or otherwise) plus any related interest received from the relevant Tax Authority. In computing the amount of any such Tax cost or Tax benefit, the indemnified party shall be deemed to recognize all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of any indemnity payment hereunder or the incurrence or payment of any indemnified Loss. For purposes of this Section 10.7 , a Tax benefit is “ currently realizable ” to the extent that such Tax benefit can be realized in the current taxable period or year or in any Tax Return with respect thereto (including through a carryback to a prior taxable period) or in any taxable period or year prior to the date of the Indemnification Claim. The amount of any increase, reduction or payment hereunder shall be adjusted to reflect any final determination (which shall include the execution of Form 870-AD or successor form) with respect to the indemnified party’s liability for Taxes, and payments between the parties to this Agreement to reflect such adjustment shall be made if necessary. Any indemnity payment under this Article X shall be treated as an adjustment to the value of the asset upon which the underlying Indemnification Claim was based, unless a final determination (which shall include the execution of a Form 870-AD or successor form) with respect to the indemnified party or any of its Affiliates causes any such payment not to be treated as an adjustment to the value of the asset for United States federal income tax purposes.

10.8. Tax Treatment of Indemnity Payments . Seller and Purchaser agree to treat any indemnity payment made pursuant to this Article X as an adjustment to the Purchase Price for federal, state, local and foreign income tax purposes.

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10.9. Exclusive Remedy . Except for claims based on fraud, Intentional Misrepresentation or willful misconduct, the sole and exclusive remedy to recover any monetary Losses for any breach or inaccuracy, or alleged breach or inaccuracy, of any representation or warranty in this Agreement or any covenant or agreement to be performed in accordance with the terms of this Agreement, shall be indemnification in accordance with this Article X . In furtherance of the foregoing, the parties hereby waive, to the fullest extent permitted by applicable Law, any and all other rights, claims and causes of action (including rights of contributions, if any) known or unknown, foreseen or unforeseen, which exist or may arise in the future, that it may have against Seller or its Subsidiaries or Purchaser, as the case may be, arising under or based upon any federal, state or local Law (including any such Law relating to environmental matters or arising under or based upon any securities Law, common Law or otherwise).

ARTICLE XI

MISCELLANEOUS

11.1. Tax Matters .

(a) Purchaser and Seller agree, upon request, to use their reasonable best efforts to obtain any certificate or other document from any Governmental Body or any other Person as may be necessary to mitigate, reduce, or eliminate any sales, use, transfer, or other Taxes to the extent permitted by Law, and to the extent such certificate or other document would not increase the Taxes of the Purchaser or Seller. In addition, Seller and Purchaser agree to obtain such tax clearance or similar certificates from any Governmental Body as the other party may reasonably require, and each party shall provide such assistance as the other party may reasonably request in obtaining such certificates.

(b) (i) Purchaser and Seller shall each pay fifty percent (50%) of (and shall indemnify and hold harmless the other party against) any sales taxes applicable to the Purchased Assets and for all other applicable sales, use, stamp, documentary, filing, recording, transfer or similar fees or Taxes or governmental charges (including real property transfer Taxes, UCC 3 filing fees, title recording or filing fees) and other amounts payable in respect of transfer filings in connection with the transactions contemplated by this Agreement, other than Taxes measured by or with respect to income taxes imposed on Seller or its Subsidiaries, which shall be the responsibility of Seller; however, Purchaser shall furnish to Seller any certification reasonably requested by Seller which will accomplish a reduction to any New York state and local sales Taxes applicable to the transfer of the Purchased Assets pursuant to this Agreement. Seller shall file all necessary documents (including all Tax Returns) with respect to all such amounts in a timely manner.

(ii) Notwithstanding the other provisions of this Section 11.1 , but subject to this paragraph, Seller and the Selling Subsidiaries shall not invoice Purchaser for any value added taxes with respect to the sale and transfer of the Business and the Purchased Assets; however, if (i) in the case of assets not owned by a Selling Subsidiary in the UK if Seller or the Selling Subsidiary reasonably determines (after consultation with Purchaser) that it is required by Law to account for value added tax with respect to the sale and purchase of those Purchased Assets, or (ii) in the case of assets owned by Seller or a Selling Subsidiary in the UK, if

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Purchaser is not registered or required to be registered for VAT in the UK at Closing, or (iii) in the event that any proceeding or demand by any Governmental Body subsequent to the Closing shall result in the imposition upon the Seller or any of the Selling Subsidiaries of any obligation to account for any value added tax with respect to the sale and transfer of the Purchased Assets, then the Seller or a Selling Subsidiary (as appropriate) shall then issue a valid value added tax invoice to the Purchaser for the full amount of such value added tax and the Purchaser and Seller shall each pay fifty percent (50%) of (and shall indemnify and hold harmless the other party against) any such value added tax (including any penalties and interest imposed by any Government Body). In the event that, subsequent to any imposition of value added taxes as aforesaid, Purchaser shall be entitled to recover from any Governmental Body (whether by way of credit or repayment) any or all of such value added tax, then Purchaser shall take such credit or apply for such repayment and Purchaser shall remit to Seller 50% of the amount of such value added tax recovered provided that Seller has complied with its payment obligations under the preceding sentence. For the avoidance of doubt, the foregoing obligation of Seller and Purchaser shall be applicable solely to the sale to Purchaser of the Business and the Purchased Assets under this Agreement and shall be inapplicable (i) to value added taxes invoiced by Purchaser to its customers in respect of services and products provided by Purchaser to such customers or (ii) credits for value added taxes which Purchaser may otherwise have in the ordinary course of its business.

(c) For purposes of Sections 2.4(b) and 3.4(b) , in the case of a taxable period that includes the Closing Date, Taxes relating to the Purchased Assets shall be allocated to the periods before and after the Closing Date as follows: (i) in the case of real property Taxes, personal property Taxes or similar ad valorem obligations, such Taxes shall be allocated to periods before and after the Closing Date on a pro rata basis as of 12:01 A.M. on the Closing Date and (ii) in the case of all other Taxes (including Taxes based on net or gross income, or transactional taxes such as sales taxes), the portion of such Taxes allocable to the period before the Closing Date shall be computed as if the taxable period ended on the Closing Date.

11.2. Expenses . Except as otherwise provided in this Agreement, each of Seller and Purchaser shall bear its own fees and expenses incurred in connection with the negotiation and execution of this Agreement, all regulatory filing fees and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby.

11.3. Submission to Jurisdiction; Consent to Service of Process; Arbitration .

(a) The parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any federal or state court located within the State of New York over any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby and each party hereby irrevocably agrees that all claims in respect of such dispute or any suit, action proceeding related thereto may be heard and determined in such courts. The parties hereby irrevocably waive, to the fullest extent permitted by applicable Law, any objection which they may now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.

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(b) Any controversy, dispute or claim arising under or in connection with this Agreement (including, without limitation, the existence, validity, interpretation or breach hereof and any claim based on contract, tort or statute) shall be resolved by a binding arbitration, to be held in New York, New York pursuant to the Federal Arbitration Act and in accordance with the then-prevailing International Arbitration Rules of the American Arbitration Association (the “ AAA ”). The AAA shall select three arbitrators. Each party shall bear its own expenses incurred in connection with arbitration and the fees and expenses of the arbitrators shall be shared equally by the parties involved in the dispute and advanced by them from time to time as required. It is the mutual intention and desire of the parties that the tribunal of three arbitrators be constituted as expeditiously as possible following the submission of the dispute to arbitration. Once such tribunal is constituted and except as may otherwise be agreed in writing by the parties involved in such dispute or as ordered by the arbitrators upon substantial justification shown, the hearing for the dispute will be held within sixty (60) days of submission of the dispute to arbitration. The arbitrators shall render their final award within sixty (60) days, subject to extension by the arbitrators upon substantial justification shown of extraordinary circumstances, following conclusion of the hearing and any required post-hearing briefing or other proceedings ordered by the arbitrators. Any discovery in connection with arbitration hereunder shall be limited to information directly relevant to the controversy or claim in arbitration, and the parties shall have such discovery rights as are available under the Federal Rules of Civil Procedure. The arbitrators will state the factual and legal basis for the award. The decision of the arbitrators in any such proceeding will be final and binding and not subject to judicial review and final judgment may be entered upon such an award in any court of competent jurisdiction, but entry of such judgment will not be required to make such award effective. Any action against any party hereto ancillary to arbitration pursuant to Section 11.3(a) (as determined by the arbitrators), including any action for provisional or conservatory measures or action to enforce an arbitration award or any judgment entered by any court in respect of any thereof may be brought in any foreign, federal or state court of competent jurisdiction, and the parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any such foreign, federal or state courts, including courts located within the State of New York over any such action. The parties hereby irrevocably waive, to the fullest extent permitted by applicable Law, any objection which they may now or hereafter have to the laying of venue of any such action brought in such court or any defense of inconvenient forum for the maintenance of such action. Each of the parties hereto agrees that a judgment in any such action may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Notwithstanding the provisions of this Section 11.3(b), (i) in the event that any dispute relates to, arises out of or is based upon any claim asserted by a third party against Seller or Purchaser or their respective Affiliates, and if such third party claim is the subject of any litigation or proceeding in any court or venue, then any cross-claim for indemnification asserted by Seller or Purchaser may be brought in the same court or venue as the third party claim which is the subject of such indemnification claim, and (ii) any action to restrain or enjoin any breach of the provisions of this Agreement, including to enforce the provisions of Section 7.13, may be brought by Seller or Purchaser in any court of competent jurisdiction.

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(c) Each of the parties hereto hereby consents to process being served by any party to this Agreement in any suit, action or proceeding by the delivery of a copy thereof in accordance with the provisions of Section 11.6 .

11.4. Entire Agreement; Amendments and Waivers . This Agreement (including the schedules and exhibits hereto), the Ancillary Agreements and the Confidentiality Agreement represent the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supercedes all prior agreements, both written and oral, between or on behalf of the parties hereto with respect to the subject matter of this Agreement. This Agreement can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. No action taken pursuant to this Agreement shall be deemed to constitute a waiver by the party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

11.5. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and performed in such State irrespective of the choice of Laws principles of the State of New York other than Section 5-1401 of the General Obligations Law of the State of New York. However, the provisions of Section 8.3 shall be governed by and construed in accordance with the laws of the United Kingdom.

11.6. Notices . All notices and other communications under this Agreement shall be in writing and shall be deemed given (i) when delivered personally by hand (with written confirmation of receipt), (ii) when sent by facsimile (with written confirmation of transmission) or (iii) one business day following the day sent by overnight courier (with written confirmation of receipt), in each case at the following addresses and facsimile numbers (or to such other address or facsimile number as a party may have specified by notice given to the other party pursuant to this provision):

If to Seller, to:

Global Crossing Holdings Limited

200 Park Avenue

Florham Park, NJ 07932

Facsimile: 973-360-0538

Attention: Office of the General Counsel

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With a copy (which shall not constitute notice) to:

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Facsimile: 212-310-8007

Attention: Michael E. Lubowitz

If to Purchaser, to:

WestCom Corporation

162 Fifth Avenue

Second Floor

New York, NY 10010

Facsimile: 212 -807-0316

Attention: General Counsel

With a copy (which shall not constitute notice) to:

Dechert LLP

30 Rockefeller Plaza

New York, New York 10112

Facsimile: 212.698-3599

Attention: Ronald R. Jewell

11.7. Severability . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any Law or public policy, all other terms or provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

11.8. Binding Effect; Assignment . This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any person or entity not a party to this Agreement except as provided in Article X with respect to Indemnified Parties. No assignment of this Agreement or of any rights or obligations hereunder may be made by either Seller or Purchaser, directly or indirectly (by operation of law or otherwise), without the prior written consent of the other parties hereto and any attempted assignment without the required consents shall be void; provided however, that Purchaser may assign this Agreement in whole or in part to any Affiliate of Purchaser without the prior written consent of Seller. No assignment of any obligations hereunder shall relieve the parties hereto of any such obligations. Upon any such permitted assignment, the references in this Agreement to Purchaser shall also apply to any such assignee unless the context otherwise requires.

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11.9. Non-Recourse . No past, present or future director, officer, employee, incorporator, member, partner, stockholder, Affiliate, agent, attorney or representative of Seller or Purchaser or their respective Affiliates shall have any liability for any obligations or liabilities of Seller or Purchaser, as applicable, under this Agreement or the Seller Documents or Purchaser Documents, as applicable, or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby and thereby.

11.10. Counterparts . This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile shall be as effective as delivery of a manually executed counterpart of any such Agreement.

[signatures appear on following page]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first written above.


GLOBAL CROSSING HOLDINGS LIMITED

By:		/s/ Mark Gottleib
Name:		Mark Gottleib
Title:		Attorney-in-fact

WESTCOM CORPORATION

By:		/s/ Michael Hirtenstein
Name:		Michael Hirtenstein
Title:		CEO

Asset Purchase Agreement dated as of March 25, 2005

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Exhibit A

Bill of Sale and Assignment and Assumption Agreement

Attached

Exhibit B

Seller Master Services Agreement

Attached

Exhibit C

Escrow Agreement

Attached

Exhibit D

SCORE License

Attached

EXHIBIT 10.21

STATEMENT OF TERMS AND CONDITIONS

4 September 2000

Mr. P. Metcalf

Gelbe House

Rectory Lane

Wildon, Bedford MK44 2PB

England

Dear Phil

This contract of employment will supersede your current contract of employment and comes into effect on 1 ^st September 2000. This letter together with the terms and conditions of employment set out in section A of the Employee Handbook (“the Handbook”), constitute the principle terms and conditions of your employment. Your employment will remain with Global Crossing Network Center (“Global Crossing”).

The following statement which is required to be given under Section 1 of the Employment Rights Act 1996 As Amended sets out certain particulars of your terms and conditions of employment as at the date of this statement. Your employment will continue subject to the rights and provisions contained below. Any variation to this statement will be notified to you in writing.

1.

Commencement of Employment

Your date of commencement of continuous employment is 1 May, 1999.

2.

Job title

Your jo


	Three Months Ended March 31,
	2005			2004
Net loss	$	(106	)	$	(108	)
Foreign currency translation adjustment		12			10
Unrealized on foreign currency hedge		2			—

Comprehensive loss	$	(92	)	$	(98	)


	Three Months Ended March 31, 2005			% of Revenue		Three Months Ended March 31, 2004			% of Revenue
	(in millions)					(in millions)
Consolidated revenue	$	526		100	%	$	666		100	%
Cost of access		(320	)	(60.8	)%		(479	)	(71.9	)%

Gross margin	$	206		39.2	%	$	187		28.1	%