GLOBAL CROSSING LTD
S-3/A, 2000-03-31
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)
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<PAGE>


  As filed with the Securities and Exchange Commission on March 31, 2000
                                                      Registration No. 333-32810
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                      POST-EFFECTIVE AMENDMENT NO. 1
                                       TO
                                    FORM S-3
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933

                                ---------------
                              GLOBAL CROSSING LTD.
             (Exact name of registrant as specified in its charter)

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

         Bermuda                       4813                     98-0189783
     (State or other       (Primary standard industrial      (I.R.S. employer
   jurisdiction of            classification number)          identification
    incorporation or                                            number)
    organization)

                                  Wessex House
                                 45 Reid Street
                             Hamilton HM12, Bermuda
                                 (441) 296-8600
  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)

                                ---------------
                             CT Corporation System

                             111 Eighth Avenue

                                13th Floor

                            New York, NY 10011

                              (212) 894-8940
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)

                                ---------------
                                   Copies to:
<TABLE>
<S>                                            <C>
            D. RHETT BRANDON, ESQ.                         JAMES C. GORTON, ESQ.
          Simpson Thacher & Bartlett                        Global Crossing Ltd.
             425 Lexington Avenue                          360 N. Crescent Drive
              New York, NY 10017                          Beverly Hills, CA 90210
                (212) 455-2000                                 (310) 385-5200
</TABLE>

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

        Approximate date of commencement of proposed sale to the public:
   From time to time after this Registration Statement becomes effective as
determined by market conditions and other factors.
   If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
   If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
   If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
   If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

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

   The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which shall specifically state that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the
Registration Statement shall become effective on such date as the Securities
and Exchange Commission, acting pursuant to said Section 8(a), may determine.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the     +
+Securities and Exchange Commission is effective. This prospectus is not an    +
+offer to sell these securities and is not soliciting an offer to buy these    +
+securities in any state where the offer or sale is not permitted.             +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
                  Subject to completion, dated March 31, 2000

PROSPECTUS SUPPLEMENT
(To prospectus dated      , 2000)

                               58,000,000 Shares

[Logo Global Crossing Ltd.]

                                  Common Stock

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

  We are offering 29,000,000 shares of our common stock. The selling
shareholders named on page S-18 are offering 29,000,000 shares of our common
stock. We will not receive any proceeds from the sale of shares by the selling
shareholders.

  Our common stock trades on the Nasdaq National Market and the Bermuda Stock
Exchange under the symbol "GBLX". On March 30, 2000, the closing sale price of
our common stock on the Nasdaq National Market was $43 5/16 per share.

                                 ------------
  Investing in our common stock involves risks, which we describe in the "Risk
Factors" sections beginning on page S-3 of this prospectus supplement and page
20 of the prospectus that is also a part of this document.

                                 ------------
  Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.

                                 ------------
<TABLE>
<CAPTION>
                                                Per
                                               Share Total
                                               ----- -----
<S>                                            <C>   <C>
Public offering price                          $     $
Underwriting discounts                         $     $
Proceeds, before expenses, to Global Crossing  $     $
Proceeds to selling shareholders               $     $
</TABLE>

  The underwriters may also purchase up to an additional 8,700,000 shares from
us and the selling shareholders at the public offering price, less underwriting
discounts, within 30 days from the date of this prospectus supplement, to cover
over-allotments. If the underwriters exercise their over-allotment option, we
will not receive any proceeds from the shares the selling shareholders will
sell.

  The underwriters expect to deliver the shares in New York, New York on
      , 2000.

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

                          Joint Book-Running Managers

Salomon Smith Barney                                        Goldman, Sachs & Co.

                               Joint Lead Manager
                              Merrill Lynch & Co.

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

     , 2000
<PAGE>

   You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the prospectus that is also a part
of this document. We have not authorized anyone to provide you with different
information. We are not making an offer to sell these securities in any state
where the offer is not permitted. You should not assume that the information
contained in this prospectus supplement or the accompanying prospectus is
accurate as of any date other than the date on the front cover of these
documents.

                               TABLE OF CONTENTS

                             Prospectus Supplement

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
About This Prospectus Supplement...........................................   ii
Incorporation by Reference.................................................   ii
Summary....................................................................  S-1
Risk Factors...............................................................  S-3
Use of Proceeds............................................................  S-5
Dividend Policy............................................................  S-5
Price Range of Our Common Stock............................................  S-5
Capitalization ............................................................  S-6
Dilution ..................................................................  S-7
Business...................................................................  S-8
Selling Shareholders....................................................... S-18
Description of Common Stock................................................ S-21
Certain Income Tax Consequences............................................ S-21
Underwriting............................................................... S-22
Legal Matters.............................................................. S-23
Experts.................................................................... S-23

                                   Prospectus

<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
About This Prospectus .....................................................   ii
Where You Can Find More Information........................................   ii
Incorporation by Reference.................................................   ii
Summary....................................................................    1
Risk Factors...............................................................   20
Cautionary Statement Regarding Forward-Looking Statements..................   27
Use of Proceeds............................................................   27
Dividend Policy............................................................   27
Description of Debt Securities.............................................   28
Description of Preferred Stock.............................................   36
Description of Common Stock................................................   38
Description of Warrants....................................................   40
Certain Income Tax Consequences............................................   42
Selling Shareholders.......................................................   55
Plan of Distribution.......................................................   56
Legal Matters..............................................................   58
Experts....................................................................   58
Service of Process and Enforcement of Liabilities..........................   58
</TABLE>

                                       i
<PAGE>

   The Bermuda Monetary Authority has given its consent to the issue and the
transfer of the shares of preferred stock and common stock into which the
shares of preferred stock may be converted that we may sell under this
prospectus supplement and the accompanying prospectus. Approvals or permissions
received from the Bermuda Monetary Authority do not constitute a guaranty by
the Bermuda Monetary Authority as to our performance or our credit worthiness.
Accordingly, in giving those approvals or permissions, the Bermuda Monetary
Authority will not be liable for our performance or default or for the
correctness of any opinions or statements expressed in this document.

   The Bermuda Monetary Authority has classified us as non-resident in Bermuda
for exchange control purposes. Accordingly, we may convert currency, other than
Bermuda currency, held for our account to any other currency without
restriction. Persons, firms or companies regarded as residents of Bermuda for
exchange control purposes require specific consent under the Exchange Control
Act, 1972 of Bermuda, and regulations promulgated under that Act, to purchase
any shares in our capital stock or any other securities that we may issue.
Under the terms of the consent given to us by the Bermuda Monetary Authority,
the issuance and transfer of the shares of our preferred stock that we may sell
under this prospectus supplement and the accompanying prospectus and the shares
of common stock into which the shares of preferred stock may be converted
between persons, firms or companies regarded as non-resident in Bermuda for
exchange control purposes may be effected without further permission from the
Bermuda Monetary Authority.

                        ABOUT THIS PROSPECTUS SUPPLEMENT

   This prospectus supplement is a supplement to the prospectus that is also a
part of this document. This prospectus supplement and the accompanying
prospectus are part of a registration statement that we filed with the SEC
using a shelf registration process. Under the shelf registration process, we
may offer from time to time debt securities, shares of preferred stock, shares
of common stock and warrants up to an aggregate amount of $8,000,000,000, of
which this offering is a part. In the accompanying prospectus, we provide you
with a general description of the securities we may offer from time to time
under our shelf registration statement. In this prospectus supplement, we
provide you with specific information about the shares of our preferred stock
we are selling in this offering. Both this prospectus supplement and the
prospectus include important information about us, our shares of preferred
stock being offered and other information you should know before investing.
This prospectus supplement also adds, updates and changes information contained
in the prospectus. You should read both this prospectus supplement and the
prospectus as well as additional information described under "Incorporation by
Reference" immediately below before investing in our shares of preferred stock.

                           INCORPORATION BY REFERENCE

   The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. We incorporate by reference in this
prospectus supplement and the accompanying prospectus the information we
indicate under "Incorporation by Reference" on page ii of the prospectus.

   You may obtain copies of those documents from us, free of cost, by
contacting us at the address or telephone number provided in "Where You Can
Find More Information" on page ii of the prospectus.

   Information that we file later with the SEC and that is incorporated by
reference in this prospectus supplement and the accompanying prospectus will
automatically update and supersede information contained in this prospectus
supplement and the prospectus. You will be deemed to have notice of all
information incorporated by reference in this prospectus supplement and the
prospectus as if that information was included in this prospectus supplement or
the prospectus.

                                       ii
<PAGE>

                                    SUMMARY

   This section contains a general summary of the information contained in this
prospectus supplement. It may not include all the information that is important
to you. You should read the entire prospectus supplement and the accompanying
prospectus and the documents incorporated by reference before making an
investment decision.

                              Global Crossing Ltd.

   We are building and offering services over the world's first integrated
global fiber optic network, consisting of 101,000 announced route miles and
serving five continents, 27 countries and more than 200 major cities. Upon
completion of our currently announced systems, our network and its
telecommunications and Internet product offerings will be available in markets
constituting over 80% of the world's international communications traffic.

   We are included in both the S&P 500 index and the Nasdaq 100 index. Our
operations are headquartered in Hamilton, Bermuda, with executive offices in
Los Angeles, California; Morristown, New Jersey; and Rochester, New York.

   We are incorporated in Bermuda, and the address of our principal executive
offices is Wessex House, 45 Reid Street, Hamilton HM12, Bermuda. Our telephone
number is 441-296-8600. You may visit us at our web site located at
www.globalcrossing.com.

                              Recent Developments

   On March 2, 2000, we announced plans to create a new class of common stock
that will track the performance of our complex web hosting business operated by
our wholly-owned subsidiary, GlobalCenter Inc. The creation of this new class
of common stock will be subject to shareholder approval. We expect to complete
this transaction in the summer of 2000, subject to market conditions.

   Our subsidiary, Asia Global Crossing, intends to do an initial public
offering of shares of its common stock and to file a registration statement
under the Securities Act of 1933 in respect of the proposed offering. Asia
Global Crossing intends to use the net proceeds from the offering primarily to
make additional capital investments in its operations and for general corporate
purposes. Asia Global Crossing anticipates that the offering will be completed
in the summer of 2000, subject to market conditions. The statements in this
paragraph do not constitute an offer of any securities for sale. The offering,
if made, will be made only by means of a prospectus contained in the
registration statement as filed with the SEC.


                                      S-1
<PAGE>


                                  The Offering

<TABLE>
<S>                         <C>
Shares of our common stock
 offered by us............. 29,000,000 shares

Shares of our common stock
 offered by the selling
 shareholders.............. 29,000,000 shares

Shares outstanding after
 this offering............. 808,714,470 shares

Over-allotment option...... 8,700,000 shares to be sold by us and the selling
                            shareholders

Use of proceeds............ We intend to use the net proceeds of this offering
                            for general corporate purposes, principally
                            capital for the expansion of our business. We may
                            also use a portion of the net proceeds to fund
                            acquisitions of complementary businesses, products
                            or technologies or to make strategic investments.

Nasdaq National Market
 symbol.................... GBLX
</TABLE>

   The number of shares of our common stock to be outstanding after this
offering is based on 779,714,470 shares outstanding as of March 3, 2000. That
number of shares, however, does not include:

  .  115,298,230 shares of our common stock reserved for issuance under our
     stock option plan;

  .  8,700,000 shares that the underwriters may purchase from us and the
     selling shareholders if they exercise their over-allotment option; and

  .  35,317,360 shares of our common stock issuable upon conversion of our
     outstanding shares of convertible preferred stock, not including any
     shares of our common stock into which shares of our preferred stock
     which we expect to sell in a concurrent offering may be convertible.

                              Concurrent Offering

   Concurrently with this offering, we are also offering shares of cumulative
convertible preferred stock under a separate prospectus supplement. We expect
that the aggregate gross proceeds of our cumulative convertible preferred stock
offering will be approximately $750,000,000. Neither offering is conditioned on
the other. We may not complete our cumulative convertible preferred stock
offering.

                   Selected historical financial information

   On pages 2 through 11 of the accompanying prospectus, we provide selected
historical financial information for (1) us, (2) the Global Marine Systems
business of Cable & Wireless Plc, which we acquired on July 2, 1999, (3)
Frontier Corporation, which we acquired on September 28, 1999, (4) Racal
Telecom, a group of wholly-owned subsidiaries of Racal Electronics plc, which
we acquired on November 24, 1999 and (5) HCL Holdings Limited, a group of
wholly-owned subsidiaries of Hutchison Whampoa, which has been contributed to
our Hutchison Global Crossing joint venture.

                              Global Crossing Ltd.
               Selected Unaudited Pro Forma Financial Information

   On pages 13 through 19 of the accompanying prospectus, we provide unaudited
pro forma condensed combined financial information of Global Crossing, Global
Marine Systems, Frontier, Racal Telecom and the Hutchison Global Crossing joint
venture.

                                      S-2
<PAGE>

                                  RISK FACTORS

   Before investing in our shares of common stock, you should carefully
consider the risks described below and in the accompanying prospectus, as well
as the other information included or incorporated by reference in this
prospectus supplement and the prospectus. The prospectus includes important
risk factors relating to our business beginning on page 20.

Risk Factors Relating to Our Common Stock

We do not plan on paying dividends in the foreseeable future and, as a result,
you will need to sell shares to realize a return on your investment.

   We do not anticipate paying cash dividends on our common stock in the
foreseeable future. Our ability to pay dividends is limited by some of our debt
instruments. Consequently, you will need to sell shares of our common stock to
realize a return on your investment, if any.

Our stock performance may be volatile.

   Historically, the market prices for securities of companies in the
telecommunications industry have been highly volatile. A number of factors
could cause the market price of our common stock to fluctuate substantially,
including:

  .  quarterly variations in operating results;

  .  competition;

  .  announcements of technological innovations or new products by us or our
     competitors;

  .  product enhancements by us or our competitors;

  .  regulatory changes;

  .  any differences in actual results and results expected by investors and
     analysts;

  .  changes in financial estimates by securities analysts; and

  .  other events or factors.

   In addition, the stock market has experienced volatility that has affected
the market prices of equity securities of many companies, and that often has
been unrelated to the operating performance of these companies. These broad
market fluctuations may adversely affect the market price of our common stock.

Future sales of our common stock may negatively affect our stock price.

   Future sales of our common stock in the public market could cause our stock
price to decline and could impair our ability to raise funds in new stock
offerings. When this offering is completed, without counting (1) any shares
that may be issued if the underwriters exercise their over-allotment option or
(2) the shares of our common stock into which the shares of cumulative
convertible preferred stock we are selling in a concurrent offering will be
convertible, we will have approximately 808,714,470 shares of common stock
outstanding and 96,239,506 shares issuable upon exercise of outstanding options
and warrants. A substantial number of these shares are "restricted shares" or
are held by our affiliates and, accordingly, may not be sold publicly except in
compliance with Rule 144. In addition, each of our executive officers and
selling shareholders has agreed, subject to specified exceptions, not to offer
or sell any shares of our common stock for a period ending (1) 90 days from the
date of this prospectus supplement, in the case of our executive officers or
(2) May 25, 2000, in the case of selling shareholders who are not executive
officers, without the prior written consent of Salomon Smith Barney Inc. and
Goldman, Sachs & Co. on behalf of the representatives of the underwriters.
However, a significant percentage of these shares are freely tradeable
immediately after completion of this offering. Sales of a substantial amount of
common stock in the public market, or the perception that sales may occur,
could adversely affect the market price of our common stock prevailing from
time to time in the public market and could impair our ability to raise funds
in additional stock offerings.


                                      S-3
<PAGE>

You will experience an immediate and substantial dilution if you purchase
common stock in this offering, because the per share price of our common stock
in this offering is substantially higher than the net tangible book value per
share of our common stock.

   If you purchase common stock in this offering, you will experience an
immediate and substantial dilution because the per share price of our common
stock in this offering is substantially higher than the net tangible book value
per share of the outstanding common stock immediately after this offering. In
addition, to the extent that outstanding options and warrants to purchase
common stock are exercised, there could be substantial additional dilution.

You will also experience dilution when we issue additional shares of common
stock that we are permitted or required to issue under options, warrants, our
stock option plan and our convertible preferred stock.

   You should be aware that we are permitted, and in some cases obligated, to
issue shares of our common stock in addition to the common stock that will be
outstanding after this offering. If and when we issue those shares, the
percentage of our common stock you own will be diluted. The following is a
summary of additional shares of our common stock that we have reserved for
issuance as of December 31, 1999:

  .  78,639,506 shares are issuable upon the exercise of options or other
     benefits under our stock option plan at a weighted average price of
     $18.76 per share, of which options covering 33,592,901 shares were
     exercisable as of December 31, 1999;

  .  17,600,000 shares are issuable upon the exercise of outstanding warrants
     at a weighted average exercise price of $9.50 per share; and

  .  35,317,360 shares are issuable upon conversion of all outstanding shares
     of our cumulative convertible preferred stock, not including any shares
     of our common stock into which shares of convertible preferred stock we
     are selling in a concurrent offering will be convertible.


                                      S-4
<PAGE>

                                USE OF PROCEEDS

   We estimate the net proceeds from the sale of shares of our common stock in
this offering will be approximately $1.2 billion, after deducting underwriting
discounts and commissions and our estimated offering expenses. We will not
receive any proceeds from the sale of shares of our common stock by the selling
shareholders in this offering.

   We plan to use our net proceeds from this offering for general corporate
purposes, principally capital for the expansion of our business. We may also
use a portion of the net proceeds of this offering to fund acquisitions of
complementary businesses, products or technologies or to make strategic
investments. Currently, there are no material commitments or understandings
with respect to any such transactions. Pending those uses, we intend to invest
those funds in short-term, investment-grade, interest-bearing instruments. We
do not believe we can accurately estimate the amounts to be used for each
purpose at this time.

                                DIVIDEND POLICY

   We do not anticipate paying dividends on our common stock in the foreseeable
future. The terms of some of our debt instruments place limitations on our
ability to pay dividends. Future dividends on our common stock, if any, will be
at the discretion of our board of directors and will depend on, among other
things, our operations, capital requirements and surplus, general financial
condition, contractual restrictions and such other factors as our board of
directors may deem relevant.

                        PRICE RANGE OF OUR COMMON STOCK

   Our common stock has traded on the Nasdaq National Market under the symbol
"GBLX" since our initial public offering in August 1998. The table below
presents, for the calendar quarters indicated, the high and low per share
closing sale prices of our common stock as reported on the Nasdaq National
Market. Share values take into account the two-for-one stock split in the form
of a stock dividend effective March 9, 1999. The third quarter 1998 information
covers the period between August 14, the date of our initial public offering,
through September 30.

<TABLE>
<CAPTION>
                                                                   High   Low
                                                                  ------ ------
<S>                                                               <C>    <C>
Calendar 1998
  Third Quarter.................................................. $12.91 $ 8.00
  Fourth Quarter.................................................  24.28   8.00
Calendar 1999
  First Quarter..................................................  62.63  18.94
  Second Quarter.................................................  64.25  39.63
  Third Quarter..................................................  50.00  20.25
  Fourth Quarter.................................................  55.75  24.81
Calendar 2000
  First Quarter (through March 30, 2000)......................... $61.06 $43.06
</TABLE>

   On March 30, 2000, the reported closing sale price of our common stock on
the Nasdaq National Market was $43 5/16 per share.

                                      S-5
<PAGE>

                                 CAPITALIZATION

   The following table presents as of December 31, 1999 (1) our actual
consolidated capitalization, (2) our capitalization as adjusted to reflect this
offering of shares of our common stock and (3) our capitalization as adjusted
to reflect this offering of shares of our common stock and the concurrent
offering of shares of our cumulative convertible preferred stock. The table
below assumes an offering price per share of $43.31, which was the closing
price of our common stock on March 30, 2000.

   You should read this table in conjunction with the "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the
consolidated financial statements and the accompanying notes incorporated by
reference in this prospectus supplement.

<TABLE>
<CAPTION>
                                        As of December 31, 1999
                          ----------------------------------------------------
                                                            As adjusted for
                                          As adjusted    this offering and the
                            Actual     for this offering  concurrent offering
                          -----------  ----------------- ---------------------
                                            (in thousands)
<S>                       <C>          <C>               <C>
Long-Term Debt            $ 5,018,544     $ 5,018,544         $ 5,018,544
Mandatorily Redeemable
 and Cumulative
 Convertible Preferred
 Stock:
  10 1/2% Mandatorily
   redeemable preferred
   stock.................     485,947         485,947             485,947
  6 3/8% Cumulative
   convertible preferred
   stock.................     969,000         969,000             969,000
   % Cumulative
   convertible preferred
   stock.................         --              --              725,000
  7% Cumulative
   convertible preferred
   stock.................     629,750         629,750             629,750
                          -----------     -----------         -----------
                            7,103,241       7,103,241           7,828,241
Shareholders' Equity:
  Common stock...........       7,992           8,282               8,282
  Treasury stock.........    (209,415)       (209,415)           (209,415)
  Other shareholders'
   equity................   9,578,927      10,792,018          10,792,018
  Accumulated deficit....    (158,989)       (158,989)           (158,989)
                          -----------     -----------         -----------
    Total Shareholders'
     equity..............   9,218,515      10,431,896          10,431,896
                          -----------     -----------         -----------
    Total
     Capitalization...... $16,321,756     $17,535,137         $18,260,137
                          ===========     ===========         ===========
</TABLE>

                                      S-6
<PAGE>

                                    DILUTION

   Our net tangible book value at December 31, 1999 was approximately $(339)
million or $(0.42) per share of common stock. Net tangible book value per share
represents the amount of our tangible assets, meaning (1) total assets less
intangible assets, (2) reduced by our total liabilities and our mandatorily
redeemable preferred stock and (3) divided by the number of shares of common
stock outstanding.

   After giving effect to 29,000,000 shares of our common stock covered by this
prospectus supplement at an assumed offering price of $43.31 per share, which
was the closing sale price of our common stock on March 30, 2000, our adjusted
net tangible book value as of December 31, 1999 would have been approximately
$874 million or $1.06 per share. This represents an immediate increase in net
tangible book value of $1.48 per share to existing shareholders and an
immediate dilution of $42.25 per share to new investors purchasing shares of
our common stock under this prospectus supplement. The following table
illustrates this per share dilution:

<TABLE>
      <S>                                                         <C>     <C>
      Assumed offering price per share..........................          $43.31
        Net tangible book value per share before this offering..  $(0.42)
        Increase per share attributable to this offering........  $ 1.48
                                                                  ------
      Adjusted net tangible book value per share after this
       offering.................................................          $ 1.06
                                                                          ------
      Dilution per share to new investors.......................          $42.25
                                                                          ======
</TABLE>

   The above analysis does not give effect to any shares of common stock into
which shares of our cumulative convertible common stock which we are selling in
a concurrent offering will be convertible.

                                      S-7
<PAGE>

                                    BUSINESS

Business Strategy

   Our strategy is to be the premier provider of global Internet Protocol,
which we refer to as "IP", and data services for both wholesale and retail
customers. We are building a state-of-the-art fiber optic network that we
believe to be of unprecedented global scope and scale to serve as the backbone
for this strategy. We believe that our network will enable us to be the low
cost service provider in most of our addressable markets.

   We offer a variety of voice, data and Internet services throughout most of
North America and Europe. During 2000, we intend to aggressively roll out
similar services in Asia, Mexico, Central America and South America.

   In Asia, we will offer these services through our Asia Global Crossing joint
venture with Softbank Corp. and Microsoft Corporation. Asia Global Crossing
aims to become the first truly pan-Asian carrier to offer worldwide bandwidth
and data communications. We believe that Asia Global Crossing will be uniquely
positioned to take advantage of the anticipated explosive growth and
increasingly favorable regulatory environment in the Asian telecommunications
markets.

   In each of our businesses, we intend to expand significantly our current
product offerings, with an increasing focus on value-added services. In
particular, our GlobalCenter subsidiary will expand its product set to become a
single-source e-commerce service solution that will provide web-centric
businesses with the high availability, flexibility and scalability necessary to
compete in the rapidly expanding digital economy.

Business Combinations

   We established the Asia Global Crossing joint venture on November 24, 1999.
We contributed to the joint venture our development rights in East Asia
Crossing, an approximately 11,000 mile undersea network that will link several
countries in eastern Asia, and our 58% interest in Pacific Crossing, an
undersea system connecting the United States and Japan. Softbank and Microsoft
each contributed $175 million in cash to Asia Global Crossing. In addition,
Softbank and Microsoft committed to make a total of at least $200 million in
capacity purchases on our network over a three-year period, expected to be
utilized primarily on our Pacific Crossing and East Asia Crossing systems.
Softbank and Microsoft have also agreed to use Asia Global Crossing's network
in the region, subject to specified conditions.

   Also on November 24, 1999, we completed our acquisition of Racal Telecom, a
group of wholly-owned subsidiaries of Racal Electronics plc, for approximately
$1.6 billion in cash. Racal Telecom owns one of the most extensive fiber
telecommunications networks in the United Kingdom, consisting of approximately
4,650 route miles of fiber and reaching more than 2,000 cities and towns.

   On September 28, 1999, we completed the acquisition of Frontier Corporation
in a merger transaction valued at over $10 billion, with Frontier shareholders
receiving 2.05 shares of our common stock for each share of Frontier common
stock. Frontier is one of the largest long distance telecommunications
companies in the United States and one of the leading providers of facilities-
based integrated communications and Internet services.

   On July 2, 1999, we completed our acquisition of the Global Marine Systems
division of Cable & Wireless Plc for approximately $908 million in cash and
assumed liabilities. Global Marine Systems owns the largest fleet of cable
laying and maintenance vessels in the world and currently services more than a
third of the world's undersea cable miles.

                                      S-8
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Recent Developments

   On March 2, 2000, we announced that Leo Hindery had succeeded Robert
Annunziata as our Chief Executive Officer. Mr. Hindery will also continue to
serve as Chief Executive Officer of our GlobalCenter subsidiary that provides
complex web hosting and Internet infrastructure services. Mr. Annunziata will
continue as one of our directors. In addition, on March 2, 2000, we also
announced our intentions to create a tracking stock for GlobalCenter, which
will continue to complement our worldwide operations.

   On February 29, 2000, we announced that we had concluded an agreement to
provide substantial additional capacity to Deutsche Telekom AG. Total capacity
sold to Deutsche Telekom is now 35 gigabits per second, or "Gbps", on our
Atlantic Crossing fiber-optic system that provides a link between North America
and Germany.

   On February 22, 2000, we announced a definitive agreement to acquire IXnet,
Inc., a leading provider of specialized IP-based network services to the global
financial services community, and its parent company, IPC Communications, Inc.,
in exchange for shares of our common stock valued at approximately $3.8
billion. Under the terms of the definitive merger agreement, 1.184 of our
shares will be exchanged for each IXnet share not owned by IPC, and 5.417 of
our shares will be exchanged for each share of IPC. We expect to complete the
acquisition in the second quarter of 2000. That acquisition is subject to
regulatory approval and customary closing conditions.

   On January 26, 2000, our Asia Global Crossing joint venture announced an
agreement to create GlobalCenter Japan, a joint venture with Japan's Internet
Research Institute, Inc., which we refer to as "IRI". GlobalCenter Japan will
design, develop and construct a media distribution center in Japan providing
connectivity worldwide through our network. The joint venture will also develop
and provide complex web hosting services, e-commerce support and applications
hosting solutions. Asia Global Crossing will own 89% of GlobalCenter Japan,
with IRI owning the remaining 11%.

   January 12, 2000, we established a joint venture, called Hutchison Global
Crossing, with Hutchison Whampoa Limited to pursue fixed-line
telecommunications and Internet opportunities in Hong Kong. For its 50% share,
Hutchison Whampoa contributed to the joint venture its building-to-building
fixed-line telecommunications network in Hong Kong and a number of Internet-
related assets. In addition, Hutchison Whampoa has agreed that any fixed-line
telecommunications activities it pursues in China will be carried out by the
joint venture. For our 50% share, we provided to Hutchison Whampoa $400 million
in our convertible preferred stock, convertible into shares of our common stock
at a rate of $45 per share, and committed to contribute to the joint venture
international telecommunications capacity rights on our network and certain
media distribution center capabilities, which together are valued at $350
million, as well as $50 million in cash. We intend to integrate our interest in
Hutchison Global Crossing into Asia Global Crossing.

Services

 General

   We provide services in three principal segments. Our telecommunications
services segment offers a variety of integrated telecommunications products and
services to customers through our global fiber optic network. Our installation
and maintenance services segment, consisting of our Global Marine Systems
subsidiary, installs and maintains undersea fiber optic cable systems to
carrier customers worldwide. Finally, our incumbent local exchange carrier,
which we refer to as "ILEC", services segment provides local communications
services through local exchange service providers in 13 states, serving over
one million access lines.

 Telecommunications services

   We provide a variety of integrated telecommunications and Internet-based
products designed to meet our customer's total communications needs. We provide
domestic and international voice services, data products, Internet-based
services, structured bandwidth services and other communications products to
primarily small to mid-size business customers, web-centric businesses and
other telecommunication carriers. Beginning in 2000,

                                      S-9
<PAGE>

we will begin marketing products more intensely to large multinational
customers who have bandwidth-intensive applications and international
requirements. Those customers demand global end-to-end solutions. We believe we
are well positioned to address this market due to the international scope and
broadband capacity of our network along with the flexibility of product pricing
to maintain competitiveness.

   We offer the following products and services to our customers:

  .  Voice: Switched and dedicated outbound voice services for local,
     domestic, and international traffic.

  .  Data Transport: Point-to-point data services in a number of products,
     including private line, ATM, frame relay, X.25 and Internet access, and
     varying bandwidth sizes, from fractional T-1 to OC-192.

  .  Virtual Private Network or "VPN": Customizable network solutions where
     our customers create a private network by using our network without
     purchasing dedicated facilities. In addition, customers have flexibility
     to change capacity requirements between points over time and reconfigure
     their VPNs to meet changing requirements.

  .  International Private Line or "IPL": Expanded services providing retail
     customers greater flexibility at reduced cost. We currently provide
     access to New York, London, Amsterdam, Frankfurt, Paris and Tokyo, with
     access expected to be available to 18 additional cities within the next
     six months.

  .  Web Hosting Services: A combination of digital distribution services,
     server co-location, equipment sales, consulting services and
     professional expertise aimed at supporting customers' mission critical
     Internet operations. This product is easily scalable to meet customer
     needs and is marketed primarily by our GlobalCenter subsidiary.

  .  Advanced Voice and Data Services: These services combine traditional
     voice or data products with additional features. Products include
     calling card, 800/888 toll free services, voice mail, audio
     conferencing, video conferencing and broadcast fax.

  .  Advanced Internet Services: Products include basic dial-up and dedicated
     Internet access along with web-based applications, such as e-mail
     hosting, unified messaging, off-site data storage and backup.

  .  Structured Bandwidth Services: Historically, we have sold capacity on
     our systems on an indefeasible right of use, or "IRU", basis, whereby
     the customer purchased a unit of point to point capacity for the
     expected economic life of the system, typically in increments of 155
     megabits per second, or "Mbps", a unit known as an STM-1. However, with
     the consummation of our acquisition of Frontier in September 1999, we
     have begun to derive a significant source of revenue from service
     offerings involving leases of capacity on our systems in smaller
     increments and for periods significantly shorter than the expected
     useful life of the system. From time to time, we also engage in sales of
     "dark" fiber, i.e., fiber that has not been equipped with the electronic
     components necessary for telecommunications transmission.

     Payment for long-term leases of capacity or dark fiber is typically made
     in advance of activation, although in some cases a customer's payments
     are made in installments over two to four years. For short-term
     bandwidth services, customers are typically billed on a monthly basis.

     Due to the breadth of our network, we are uniquely positioned to offer
     worldwide capacity to our customers. Many customers acknowledge that
     their need for large bandwidth is increasing, but they are often
     uncertain with regard to the precise routes where their particular
     growth will take place. In order to stimulate customer loyalty and
     leverage this uncertainty, we have developed the Global Crossing network
     offer, which allows customers who can make a multi-year commitment the
     flexibility to activate capacity where needed, in a "just-in-time"
     manner, in return for volume discounted pricing. As our network
     continues to expand, we are exploring other marketing programs that will
     provide further benefits to our customers and position us as the
     broadband infrastructure provider of choice.


                                      S-10
<PAGE>

     Moreover, because our centralized Global Crossing network center,
     located in The Docklands, London, England, enables us to monitor and
     direct transmission on our cable systems worldwide, we believe that we
     have a strategic advantage in being able to more quickly activate
     capacity for a customer on any of our systems.

  .  Switched Services: We provide originating and switched terminating
     services to long distance carriers over our switched services network.
     These services are generally offered on a month-to-month basis, and the
     service is billed on a minutes-of-use basis.

  .  Internet Protocol Services: We offer IP services to carriers, Internet
     service providers, or "ISPs", and other business customers over our
     global IP network. We offer these services on a month-to-month basis,
     and we generally bill them on an Mbps basis.

 Installation and maintenance services

   We offer both installation and maintenance services for undersea cable
systems through our Global Marine Systems subsidiary. Global Marine Systems
has the largest fleet of cable ships in the world, comprised of both
maintenance vessels and installation vessels. These vessels operate throughout
the world. Since the acquisition, Global Marine Systems added three ships,
with five additional ships to enter service early in 2000. Global Marine
Systems also announced an agreement with Maersk to charter ships as needed.

   Global Marine Systems' business consists of two components: installation
and maintenance.

  .  Maintenance: Global Marine Systems is the world's market leader for
     submarine cable maintenance with 31% of the world market by value in
     1999.

     Global Marine Systems' maintenance business is centered around cable
     system security. Despite optimum route planning and installation, cables
     are sometimes damaged on the seabed. The maintenance cable ship must be
     able to retrieve a partially buried cable down to 2,000 meters as well
     as retrieve and repair a cable from the furthest ocean depths. With
     cable in water depths of up to 9,000 meters, the cable ship is a
     specialized vessel designed to operate continuously in the extreme
     weather conditions found in the major cable routes around the world.

  .  Installation:  Global Marine Systems' installation business has a market
     share in excess of 25%, making it a leading competitor in the undersea
     telecommunications installation industry.

     Revenue from installation is linked to the number of submarine
     telecommunication cable systems annually installed worldwide. Those
     systems traverse many types of seabed, including active continental
     shelves, flat deep-water abyssal plains and mountainous oceanic ridges.
     The objective when installing cable is to deploy it in such a way as to
     minimize the risk of damage to the cable either from external threats or
     from natural wear effects caused by ocean currents and tides. The cable
     can either be buried into the seabed if protection is required from
     threats such as fishing and anchoring or it can simply be laid across
     the surface of the seabed.

 ILEC services

   Our ILEC services segment comprises one of the largest local exchange
service providers in the United States. This segment consists of 34 regulated
telephone operating subsidiaries in 13 states, serving in excess of one
million access lines. Those services are marketed under the name Frontier
Telephone, a Frontier Communications Company. The local exchange carriers
provide local, toll, access and resale services, sell, install and maintain
customer premises equipment and provide directory services. Our ILEC services
segment excludes local services provided by our subsidiaries authorized as
competitive local exchange carriers, or "CLECs", which services are included
in our telecommunications services segment. Generally speaking, ILECs tend to
be the original provider of local exchange service in a given area and,
accordingly, receive a greater degree of regulation than do CLECs and other
carriers without market power.

                                     S-11
<PAGE>

   We have installed advanced digital switching platforms throughout all of our
switching network, making it one of the first in the industry to be served by
an entirely digital network for our local exchange companies. We have achieved
substantial cost reductions through the elimination of duplicative services and
procedures and the consolidation of administrative functions. We believe that
additional cost reductions may be obtainable from advanced switching platforms
and outside plant delivery systems. We intend to pursue additional gains in
productivity by investing in these technologies where feasible and by
reengineering customer service processes.

   Of the approximately 1,072,000 access lines in service on December 31, 1999,
737,000 were residential lines and 335,000 were business lines. Long distance
network service to and from points outside of the telephone companies'
operating territories is provided by interconnection with the facilities of
interexchange carriers.

   We are pursuing several alternatives to provide expanded broadband
capabilities to our customers. To date, we have installed over 31,000 fiber
miles of fiber based network facilities, totaling more than 930 route miles, in
the Rochester, New York area to provide our customers with enhanced capacity
and to enable us to offer new products. We provide expanded broadband services
to select customers, including video-distance learning arrangements for
educational institutions and access to SONET based fiber rings for major
business customers. In addition to these offerings, we plan to aggressively
begin marketing Digital Subscriber Line, or "DSL", services in 2000.

   In connection with our integration strategy, we have developed a program
known as "Frontier Long Distance", whereby our local exchange companies resell
our integrated services. We believe that many customers prefer the convenience
of obtaining their long distance service through their local telephone company
and receiving a single bill. Frontier Long Distance is currently offered in the
product lines of most of our local telephone exchange companies.

The Global Crossing Network

   The fiber optic cable systems that we have completed or that are under
development will form a state-of-the-art interconnected worldwide high capacity
fiber optic network. The following systems are currently in service:

  .  Atlantic Crossing-1, which we refer to as "AC-1", an undersea system
     connecting the United States and Europe;

  .  North American Crossing, which we refer to as "NAC", formerly part of
     Frontier, a terrestrial system connecting major cities in the United
     States;

  .  Pan European Crossing, which we refer to as "PEC", a primarily
     terrestrial system connecting major European cities to AC-1;

  .  Racal Telecom Network, a terrestrial network in the United Kingdom to be
     operated in conjunction with PEC;

  .  Pacific Crossing, which we refer to as "PC-1", an undersea system
     connecting the United States and Japan;

  .  Global Access Ltd., which we refer to as "GAL", a terrestrial system
     connecting a number of major cities in Japan to PC-1;

  .  Hutchison Global Crossing, which we refer to as "HGC", a terrestrial
     network in Hong Kong, connecting to East Asia Crossing; and

  .  Mid-Atlantic Crossing, which we refer to as "MAC", an undersea system
     connecting the eastern United States and the Caribbean.

                                      S-12
<PAGE>

   The following systems are in varying stages of development:

  .  Atlantic Crossing-2, which we refer to as "AC-2", an undersea system
     that will connect the United States and Europe;

  .  East Asia Crossing, which we refer to as "EAC", an undersea system that
     will connect several countries in Asia to PC-1;

  .  Pan American Crossing, which we refer to as "PAC", a primarily undersea
     system that will connect the western United States, Mexico, Panama,
     Venezuela and the Caribbean; and

  .  South American Crossing, which we refer to as "SAC", an undersea and
     terrestrial system that will connect the major cities of South America
     to MAC, PAC and the rest of our network.

   Although many of these fiber optic cable systems are wholly-owned, some are
being developed through joint ventures with one or more partners. EAC and our
58% economic interest in PC-1 are being developed through our Asia Global
Crossing joint venture, for which we are responsible for management and
operation. In addition, we expect to construct parts of the terrestrial
portion of SAC through joint venture arrangements, and terrestrial
connectivity to PAC in Mexico will similarly be developed through a joint
venture. We will be responsible for management and operation of these
entities. Finally, we own a 50% interest in Hutchison Global Crossing and a
49% interest in Global Access Ltd., which is constructing GAL. Management and
operation of these two entities will be performed by or with our joint venture
partners.

   All of our undersea systems are equipped with state-of-the-art dense wave
division multiplexing, or "DWDM", technology, a method of increasing the
amount of a cable's transmission capacity through installation of electronic
equipment at cable landing stations and without requiring the undersea cable
to be physically handled.

   The twin operations and management centers for the Global Crossing network
are the customer care center, located in Bermuda, and the Global Crossing
network center, located in The Docklands, London, England. These two
facilities provide complete customer support, from provisioning and assistance
to billing. From the Global Crossing network center, our technicians and
network managers monitor and control all undersea cable systems, shore station
equipment and terrestrial facilities worldwide. The Global Crossing network
center began operations in the fourth quarter of 1999.

Network Systems

 Atlantic Crossing

   AC-1, our first undersea fiber optic cable in the Atlantic region, is an
approximately 9,000 mile, four fiber pair self-healing ring that connects the
United States and Europe with landing stations in the United States, the
United Kingdom, the Netherlands and Germany. The full ring currently offers 80
Gbps of service capacity and is being upgraded to offer 140 Gbps. AC-1 started
service on its United States to United Kingdom segment during May 1998, and
the full system was completed during February 1999.

   On February 17, 2000, we announced that we had entered into an agreement
with Level 3 Communications, Inc. to co-build an additional high-capacity,
fiber optic transatlantic cable. Our two fiber pairs in the cable, to be
called AC-2, will provide us with an additional 560 Gbps of capacity along
this route. AC-2 will be integrated with the two cables of AC-1, providing AC-
2 with self-healing capabilities. The new cable is expected to be in service
in September 2000. In addition, Level 3 Communications, Inc. agreed to acquire
capacity on AC-1 to provide Level 3 Communications, Inc. with self-healing
ring circuitry.

 North American Crossing

   We acquired NAC, formerly the Frontier Optronics Network, as a result of
our September 1999 merger with Frontier Corporation. The core fiber network,
offering more than 13,000 route miles of optical fiber capacity, was completed
in August 1999. The full network, consisting of approximately 20,000 route
miles, is expected to be completed by the end of March 2000.

                                     S-13
<PAGE>

 Pan European Crossing

   Upon completion, PEC will consist of eight self-healing rings offering
connectivity between AC and 41 major European metropolitan centers. Phase I of
this system, connecting 13 cities, was completed in December 1999. The complete
system, expected to consist of approximately 13,400 miles with 24 to 72 fiber
pairs as well as spare conduits, is anticipated to be completed by early 2001.

   We intend to operate the Racal Telecom Network in conjunction with PEC.
Acquired in November 1999, the Racal Telecom Network is one of the most
extensive fiber telecommunications networks in the United Kingdom, consisting
of approximately 4,500 route miles of fiber and reaching more than 2,000 cities
and towns.

 Pacific Crossing

   PC-1, our first undersea fiber optic cable in the Pacific region, is being
developed as an approximately 13,100 mile, four fiber pair self-healing ring
connecting California and Washington in the western United States with two
landing sites in Japan. The PC-1 self-healing ring is designed to operate
initially at 80 Gbps of service capacity, upgradable to a minimum of 160 Gbps.
The first segment of PC-1 commenced service in December 1999 and the full
system is anticipated to be completed in July 2000.

 Global Access Ltd.

   GAL is an approximately 1,000 mile fiber optic terrestrial system in Japan
that, among other things, will connect the PC-1 cable stations with Tokyo,
Osaka and Nagoya, Japan. The first phase of GAL's development was completed in
December 1999, with the full system anticipated to be completed by the third
quarter of 2000.

 Hutchison Global Crossing

   Hutchison Global Crossing owns and operates a building-to-building fixed-
line telecommunications network in Hong Kong and a number of Internet-related
assets. The fiber optic network as of December 1999 extended over 400 miles and
is expected to be expanded during 2000. In addition, any fixed-line
telecommunications activities that Hutchison Whampoa pursues in China will be
carried out by the joint venture.

 Mid-Atlantic Crossing

   MAC is an approximately 4,700 mile two fiber pair self-healing ring
connecting New York, the Caribbean and Florida. MAC connects to AC via its
cable station in Brookhaven, New York, to NAC via its cable stations in
Brookhaven and in Hollywood, Florida and to SAC and PAC via its cable station
in St. Croix, United States Virgin Islands. This system is being designed to
operate initially at 20 Gbps of service capacity, upgradable to a minimum of 40
Gbps. MAC commenced service in January 2000, with the full system anticipated
to be completed during 2000.

 East Asia Crossing

   EAC will be an approximately 11,000 mile terrestrial and undersea cable
system, Phase I of which will link Japan, Taiwan, South Korea and Hong Kong,
and Phase II of which is expected to further link Singapore, Malaysia and the
Philippines. EAC is being designated to operate initially at 80 Gbps of service
capacity, upgradable to a minimum of 1,200 Gbps. The first segment of EAC's
development, linking Japan and Hong Kong, is expected to be completed by
December 2000, with the full Phase I system anticipated to be completed by June
2001.

                                      S-14
<PAGE>

 Pan American Crossing

   PAC will be an approximately 6,000 mile two fiber pair cable system
connecting California, Mexico, Panama, Venezuela and the Caribbean. PAC will
interconnect with PC-1 and NAC through our landing station in Grover Beach,
California, with MAC through our landing station in St. Croix, United States
Virgin Islands and with SAC through our landing station in Fort Amador, Panama.
PAC is being designed to operate initially at 20 Gbps of service capacity,
upgradable to a minimum of 40 Gbps. PAC is anticipated to commence service
during 2000.

   In connection with PAC, we own a 49% interest in Global Crossing Landing
Mexicana, S. de R.L. de C.V., a joint venture company jointly owned with an
affiliate of Bestel, S.A. de C.V., that will provide approximately 2,200 miles
of terrestrial connectivity in Mexico and connect to the PAC system.

 South American Crossing

   SAC will be an approximately 9,900 mile undersea and 1,500 mile terrestrial
fiber optic network directly linking the major cities of South America through
MAC and PAC to the United States, Mexico, Central America, the Caribbean, Asia
and Europe. We plan to build SAC in three phases. The first two phases,
providing Argentina and Brazil with connectivity to the Global Crossing
Network, are scheduled to commence service in the fourth quarter of 2000. The
final phase, completing the loop around the continent, is scheduled for
completion in the first quarter of 2001. Initially, SAC is expected to have a
capacity of 40 Gbps and to be upgradable to a minimum of 80 Gbps.

   The undersea portion of SAC will constitute a state-of-the-art four-fiber
pair, self-healing ring, expected to connect to landing sites at St. Croix;
Fortaleza, Rio de Janeiro and Santos, Brazil; Las Toninas, Argentina;
Valparaiso, Chile; Lurin, Peru; Buenaventura, Colombia; and Fort Amador,
Panama. Terrestrial segments are expected to connect to most major South
American cities, including Rio de Janeiro, Sao Paulo, Buenos Aires, Santiago,
Lima, Cali and Bogota. The SAC ring is expected to be completed on its
southern-most end by a terrestrial link across the Andes between Las Toninas
and Valparaiso. The PAC system from Panama to St. Croix is expected to complete
the ring.

Additional Business Opportunities

   In addition to the core components of the Global Crossing network, we also
intend from time to time to make strategic investments and other contractual
arrangements to better enable us to expand our offerings of products and
services. Some of these opportunities include:

   NextWave. We have agreed to make an equity investment in NextWave Telecom
Inc. as part of NextWave's plan of bankruptcy reorganization, subject to
certain conditions relating to NextWave's retaining communications licenses
from the Federal Communications Commission. In addition, we have entered into a
strategic services agreement with NextWave making us the preferred provider of
backhaul, long distance backbone, web-hosting and other communications services
to NextWave. NextWave plans to deploy a wireless telecommunications network
specifically designed to provide next generation wireless services, including
Internet access.

   Telergy. We have entered into an agreement with Telergy, Inc., under which
we have acquired 96 strands of fiber throughout the New York area on Telergy's
100-mile New York City network. In addition, the agreement provides us with an
ownership position in Telergy and representation on its board of directors. We
and Telergy have also agreed to explore co-build opportunities in the
northeastern United States and to seek to utilize the Telergy network as needed
for redundancy and termination of Global Crossing traffic in certain areas.

   Africa ONE. We have been selected to provide marine operations and to act as
project manager of Africa ONE, an estimated $1.6 billion cable system
consisting of a self-healing ring around the continent of Africa. We do not
intend to make an equity investment in this system.

                                      S-15
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Principal Customers

   Although we have greatly expanded the number of products and services that
we offer to our customers, our principal customers to date have been licensed
telecommunications providers, including post, telephone and telegraph
companies, Internet service providers and established and emerging
telecommunications companies, that have purchased significant amounts of
capacity on our systems worldwide. Significant customers in our
telecommunications services segment include Deutsche Telekom, MCI Worldcom,
Level 3 Communications, KPN Qwest, Teleglobe, Telia, British Telecom, Viatel
and AT&T. In addition, the largest of our web hosting customers include Yahoo!,
The Motley Fool, Ziff-Davis, MP3.com and eToys.

Principal Suppliers

   Our principal suppliers are the companies that are constructing the various
cable systems that comprise the Global Crossing Network. Tyco Submarine Systems
Ltd., which we refer to as "TSSL", completed construction of AC-1; is
responsible for the design and installation of PAC; together with Alcatel, is
responsible for design and installation of MAC; and, together with Kokusai
Denshin Denwa-Submarine Cable Systems, which we refer to as "KDD-Ses", as a
subcontractor, is responsible for design and installation of PC-1. Alcatel is
responsible for the design and construction of SAC, while KDD-SCS is
responsible for the design and construction of the first phase of EAC. We
utilize multiple suppliers for terrestrial systems.

Competition

 Telecommunications services

   The telecommunications industry is highly competitive. Many of our existing
and potential competitors, particularly in our telecommunications services
markets, compete with significantly greater financial, personnel, marketing and
other resources and have other competitive advantages.

   The telecommunications industry is in a period of rapid technological
evolution, marked by increasing fiber and satellite transmission capacity, new
technologies and the introduction of new products and services. For instance,
recent technological advances enable substantial increases in transmission
capacity of both new and existing fiber, which could affect capacity supply and
demand. Also, the introduction of new products or emergence of new technologies
may reduce the cost or increase the supply of certain services similar to those
we provide.

   High initial network cost and low marginal costs of carrying long distance
traffic have led to a trend among non-facilities-based carriers to consolidate
in order to achieve economies of scale. This consolidation could result in
larger, better-capitalized competitors. However, we believe that owning our own
network will offer an advantage over carriers that lease network capacity.

   Increased consolidation and strategic alliances in the industry resulting
from the Telecommunications Act of 1996 have allowed significant new
competitors to enter the industry, including local exchange carriers,
previously prohibited from the inter-state market.

   In recent years, competition has increased dramatically in all areas of our
communications services market. Our primary competitors include Qwest, AT&T,
Sprint and MCI WorldCom and foreign PTTs, all of whom have extensive experience
in the long distance market. The impact of continuing consolidation in the
industry is uncertain. In addition, pursuant to the Telecommunications Act,
local exchange carriers, including Bell Atlantic, have begun to enter the long
distance market in their home service areas.

   As we expand our business into Internet protocol services, we are also
competing with a wide range of companies that provide web hosting, Internet
access and other Internet protocol products and services. Significant
competitors include IBM, GTE, UUNet which is a subsidiary of MCI WorldCom,
Digex and Exodus. In addition, many smaller companies have entered the market
for web-based services.

   The routes addressed by our systems are currently served by several cable
systems as well as satellites. Primary future sources of transatlantic
competition for us may result from, among others, (1) TAT-14, a transatlantic
cable system which is being developed by its consortium members, including
British Telecom,

                                      S-16
<PAGE>

AT&T, France Telecom and Deutsche Telekom, (2) Flag Atlantic-1, a transatlantic
system which is being developed by Flag Telecom and Global Telesystems Group
Inc., (3) a transatlantic cable system being developed by Level 3 (the other
half of the cable we are co-building as AC-2); and (4) Hibernia, a
transatlantic cable system being developed by 360networks.

   Similarly, we expect to face competition in the transpacific market from,
among others, (1) the China-U.S. Cable Network, a transpacific system being
developed as a "private cable system" by fourteen large carriers, including SBC
Communications Inc., MCI WorldCom Inc., AT&T and Sprint, most of which have
traditionally sponsored consortium cables and (2) the Japan-U.S. Cable Network,
a transpacific system being developed by a consortium of major
telecommunications carriers, including MCI WorldCom Inc., AT&T, Kokusai Denshin
Denwa Co. Ltd., Nippon Telegraph and Telephone Corp., Cable & Wireless and GTE.

   In addition, we will face competition on PEC, our trans-European network.
There are several carriers, including Viatel, KPN-Qwest, MCI WorldCom, Inc., a
joint venture between Deutsche Telekom and France Telecom, British Telecom,
Global Telesystems Group and a joint venture between Level 3 and COLT Telecom
Group plc, which are currently planning or building trans-European network
assets.

   We also face competition for our SAC network in South America. At least six
other systems are planned to be completed in the region by the third quarter of
2001, including two consortium cables, Americas-2 and Atlantis-2; Atlantica-1,
a ring network being constructed by GlobeNet connecting Venezuela, Brazil, and,
through terrestrial cables, Argentina to North America; and SAm-1, a ring
system being constructed by Telefonica S.A. and TSSL connecting Brazil,
Argentina, Chile, Peru and Colombia to the United States. In addition, we may
face competition from existing and planned regional systems and satellites on
our MAC and PAC routes, where entrants are vying for purchases from a small but
rapidly growing customer base.

   In addition to the systems mentioned above, several other regional and
global systems are being developed, most notably by TSSL, which has recently
announced its plans to build a worldwide cable network, and Project Oxygen, a
global system being evaluated by the CTR Group, Ltd.

   In the United States, there are several facilities-based long distance fiber
optic networks competing with our NAC cable system, including those of AT&T,
Sprint, MCI WorldCom, Qwest, GTE, Broadwing Communications, Level 3
Communications and Williams Communications.

 Installation and maintenance services

   Although Global Marine Systems is the world's largest undersea cable
installation and maintenance company, with approximately 25% of the industry's
total vessels, it faces potential competition not only from existing market
participants but also from potential new entrants. There are currently three
other major supply companies in the undersea cable industry: TSSL, Alcatel and
KDD-SCS. Pirelli also has a presence in the industry, and there are a number of
smaller suppliers which have focused primarily on regional routes or non-
repeatered systems. It is unclear whether TSSL will continue to provide
significant installation and maintenance services to others following its
announcement that it is constructing its own worldwide cable network.

 ILEC services

   We face many competitors in the provision of equipment and facilities used
in connection with our local exchange networks, as this market has become
increasingly competitive in recent years. The market for the provision of local
services itself is now competitive in Rochester, New York, as a result of the
Open Market Plan, and the Telecommunications Act is likely to result in
significantly greater competition in other markets. Our telephone properties
outside the Rochester, New York, area are experiencing competition in limited
areas.

   Long distance companies largely access their end user customers through
interconnection with local exchange companies. These long distance companies
pay access fees to the local exchange companies for these services. The
provision of access services in Rochester and elsewhere by our ILEC services
segment is considered to be competitive.

                                      S-17
<PAGE>

                              SELLING SHAREHOLDERS

   The following table identifies (1) each of our shareholders that is selling
shares in this offering, (2) the number and percentage of shares of our common
stock that each of these selling shareholders owns beneficially before this
offering, (3) the number of shares of our common stock that each of these
selling shareholders is selling in this offering and (4) the percentage of
shares of our common stock that each of these selling shareholders will own
after this offering. The percentages indicated in the table below are based on
779,714,470 shares of our common stock outstanding on March 3, 2000.

<TABLE>
<CAPTION>
                                               Shares of common                    Shares of common
                                              stock owned before                  stock owned after
                                                this offering    Number of shares   this offering
                                              ------------------  to be sold in   ------------------
 Beneficial owner     Selling shareholder       Number   Percent  this offering     Number   Percent
 ----------------     -------------------     ---------- ------- ---------------- ---------- -------
 <C>               <S>                        <C>        <C>     <C>              <C>        <C>
 Gary Winnick(1)                              97,642,042 12.52%                   87,148,609 11.18%
                   GKW Unified Holdings LLC                         9,053,222
                   Winnick Family                                   1,440,211
                    Foundation, Inc.
 Canadian          CIBC Capital Partners      66,839,854  8.57%     6,591,633     60,248,221  7.73%
  Imperial Bank     (Cayman) 3
  of Commerce
 ULLICO Inc.       GBL Holdings, Inc.         30,807,456  3.95%     3,310,828     27,496,628  3.53%
 David L. Lee(2)                              21,947,486  2.81%                   19,588,825  2.51%
                   David L. Lee                                     1,209,014
                   David and Ellen Lee                              1,149,647
                    Family Trust
 Barry Porter(3)                              20,399,077  2.62%                   18,206,821  2.34%
                   Barry Porter                                     1,209,014
                   Galenight Corp.                                    983,242
 Abbott L.                                    13,103,697  1.68%                   11,695,464  1.50%
  Brown(4)
                   Ridgestone Corporation                             874,090
                   Brown Living Trust                                 534,143
 Lodwrick Cook(5)  Lodwrick Cook               4,756,171  0.61%       511,138      4,245,033  0.54%
 Co-Invest         Co-Invest Merchant Fund,    8,697,973  1.12%       934,757      7,763,216  1.00%
  Merchant Fund,    LLC
  LLC
 Jay Bloom(6)      J. Bloom Corporation        2,399,182  0.31%       257,836      2,141,346  0.27%
 Andrew Heyer(7)   A. Heyer Corporation        3,133,864  0.40%       349,688      2,784,176  0.36%
 Dean Kehler(8)    D. Kehler Corporation       3,253,864  0.42%       349,688      2,904,176  0.37%
 Mario Monello(9)  M. Monello Corporation      2,176,943  0.28%       241,850      1,935,093  0.25%
</TABLE>
- --------
(1) Mr. Winnick is the Chairman of the Board of Global Crossing.

(2) Mr. Lee is the President and Chief Operating Officer and a director of
  Global Crossing.

(3) Mr. Porter is a Senior Vice President and a director of Global Crossing.

(4) Mr. Brown is a Senior Vice President and a director of Global Crossing.

(5) Mr. Cook is the Co-Chairman of the Board of Global Crossing.

(6) Mr. Bloom is employed by an affiliate of CIBC, and is a director of Global
  Crossing.

(7) Mr. Heyer is employed by an affiliate of CIBC.

(8) Mr. Kehler is employed by an affiliate of CIBC and is a director of Global
  Crossing.

(9) Mr. Monello is employed by an affiliate of CIBC.

   In the past three years, we have had the following material relationships
with some of the selling shareholders identified above:

                                      S-18
<PAGE>

  Transactions with Pacific Capital Group and its affiliates

   Before 1999, we entered into a number of transactions with affiliates of
Pacific Capital Group, including the acquisition of development rights to a
number of our fiber optic cable systems. Pacific Capital Group is controlled by
some of our officers and directors who either currently are or at one time were
affiliated with Pacific Capital Group including Messrs. Winnick, Cook, Lee,
Porter and Brown. During 1999, we subleased from Pacific Capital Group two
suites of offices in Beverly Hills for payments aggregating approximately
$287,000 over the year. In October 1999, we entered into a lease with North
Crescent Realty V, LLC, which is managed by and affiliated with Pacific Capital
Group, for an aggregate monthly cost of approximately $400,000. North Crescent
Realty paid approximately $7.5 million to improve the property to meet our
specifications, and we reimbursed it for approximately $3.2 million of this
amount. We engaged an independent real estate consultant to review the terms of
our occupancy of the building, and the consultant found the terms to be
consistent with market terms and conditions and the product of an arm's length
negotiation. We sublease approximately 12,000 square feet of the building to
Pacific Capital Group for an aggregate monthly cost of approximately $53,000.

   Pacific Capital Group has fractional ownership interests in aircrafts used
by us during 1999. We reimburse Pacific Capital Group for its cost of
maintaining these ownership interests so that Pacific Capital Group realizes no
profit from the relationship. During 1999, Pacific Capital Group billed us
approximately $2 million in aggregate under this arrangement.


   In 1997, we paid $7 million in fees to Pacific Capital Group and some of its
key executives, who are our shareholders, and another shareholder for services
provided in respect of obtaining the AC-1 credit facility, our 9 5/8% senior
notes and the preferred stock financing of one of our subsidiaries. Of the fees
paid, $5 million was allocated to the AC-1 credit facility and our 9 5/8%
senior notes and recorded as deferred finance costs, $1 million was allocated
to our subsidiary's, Global Crossings Holdings', preferred stock and recorded
as a reduction in the carrying value of the preferred stock and $1 million was
recorded as common stock issuance costs.

  Transactions with Canadian Imperial Bank of Commerce and its affiliates

   During 1999, Canadian Imperial Bank of Commerce and its affiliates entered
into certain financing transactions with us. In particular, Canadian Imperial
Bank of Commerce (1) acted as an arranger for the $600 million 10-day demand
note issued by Global Marine Systems in July 1999, (2) acted as an arranger for
the $3 billion senior secured credit facility entered into by Global Crossing
Holdings in July 1999, (3) was an initial purchaser of the $2 billion aggregate
principal amount of unsecured senior notes issued by Global Crossing Holdings
in November 1999 and (4) was an initial purchaser of our $650 million aggregate
liquidation preference 7% cumulative convertible preferred stock issued in
December 1999. During 1999, we paid Canadian Imperial Bank of Commerce
approximately $5.6 million in fees in connection with these transactions.
Canadian Imperial Bank of Commerce has a substantial beneficial ownership
interest in us, and some of our directors are employees of an affiliate of
Canadian Imperial Bank of Commerce.

  Advisory services agreement

   Our wholly-owned subsidiary, Atlantic Crossing Limited, entered into an
advisory services agreement with PCG Telecom, an affiliate of Pacific Capital
Group. Under the advisor services agreement, PCG Telecom provided Atlantic
Crossing Limited with advice in respect of the development and maintenance of
AC-1, development and implementation of marketing and pricing strategies and
the preparation of business plans and budgets. As compensation for its advisory
services, PCG Telecom received a 2% fee on our gross revenue over a 25-year
term, subject to certain restrictions, with the first payment to occur at the
AC-1 ready for service date. Advances on fees payable under the advisory
services agreement were being paid to PCG Telecom at a rate of 1% on signed
capacity purchase agreements until the advisory services agreements was
terminated, as described below. Fees paid under the advisory services
agreements to PCG Telecom were shared among

                                      S-19
<PAGE>

ULLICO, Pacific Capital Group, Canadian Imperial Bank of Commerce and some of
our directors and officers, all of whom are shareholders. Effective June 1998,
we acquired the rights under the advisory services agreement for common stock
and contributed those rights to our operating subsidiaries as the advisory
services agreement was terminated. This transaction was recorded in the
consolidated financial statements as an increase in additional paid-in capital
of $135 million and a charge against operations in the amount of $138 million.
The $138 million is comprised of a $135 million settlement of the fees that
would have been payable and the cancellation of $3 million owed to us and our
subsidiaries under a related advance agreement. The $135 million amount was
calculated by applying the 2% advisory services fee to projected future revenue
and discounting the amount relating to AC-1 revenue by 12% and the amount
relating to all other system's revenue by 15%. The result of this calculation
was $156 million, which was subsequently reduced to $135 million. Both the
discount rates and the ultimate valuation were determined as a result of a
negotiation process including one of our non-management directors and the
various persons entitled to fees under the advisory services agreement. We
obtained a fairness opinion from an independent financial advisor in connection
with this transaction. In addition, we incurred approximately $2 million of
advisory fees prior to termination of the contract, for a total expense of $140
million for the year ended December 31, 1998.

  Pacific Capital Group warrants

   The Pacific Capital Group warrants, issued in 1998 by our predecessor,
Global Crossing Ltd., LDL, became exercisable upon the completion of our
initial public offering. We call these warrants the "old warrants". The old
warrants gave each holder the option to convert each share under warrant into a
fraction of a class B of our predecessor's share based upon the ratio of the
current per share valuation at the time of conversion less the per share
exercise price of the warrant divided by the current per share valuation at the
time of conversion multiplied by the 36,906,372 shares available under the old
warrants, together with a new warrant to purchase the remaining fraction of
that class B share at an exercise price equal to the then current per share
valuation. Before our initial public offering, the holders of the old warrants
exercised their warrants to acquire our predecessor's class B shares by way of
the cashless conversion and the new warrants were issued with an exercise price
based on the per share valuation at the conversion date, the obligation of
which we assumed.

   We accounted for the cashless conversion of the old warrants, which occurred
as of June 1998, using the current estimated per share valuation at the
expected conversion date, multiplied by the number of class B shares of our
predecessor estimated to be converted in exchange for the old warrants. The
resulting value under this calculation is approximately $213 million, which was
allocated to the new systems in exchange for the old warrants. In connection
with the formation of our subsidiary, Pacific Crossings Limited, we agreed to
make available to Pacific Crossing Limited the consideration received by us in
connection with the grant of the old warrants, in addition to the $231 million
cash investment made by us. Therefore, we recorded an increase in our
investment in Pacific Crossing Limited in the amount of approximately $127
million and an increase in construction in progress for PAC and MAC in the
amounts of approximately $50 million and $36 million, respectively, with a
corresponding increase of $213 million in additional paid-in capital. The $213
million was allocated on a pro rata basis to the three projects according to
the estimated cost of each system. Our accounting for the old warrants is under
Emerging Issues Task Force 96-18, "Accounting for Equity Instruments with
Variable Terms that are Issued for Consideration other than Employee Services
under FASB Statement No. 123", which we refer to as "EITF 96-18". Under EITF
96-18, the fair value of equity instruments issued for consideration other than
employee services should be measured using the stock price or other measurement
assumptions as of the date at which a firm commitment for performance level has
been reached. We have recorded the estimated value of the old warrants as of
June 1998, since our initial public offering was probable at that date. The
$213 million value attributed to the old warrants as of June 1998 was adjusted
to the actual value of $275 million on the date of our initial public offering
based upon the $9.50 price per share of our initial public offering.

   We gave accounting recognition for the new warrants on the date these
warrants were issued, which was the date of our initial public offering. We
valued each of the new warrants at $3.48 based on an independent

                                      S-20
<PAGE>

valuation based on our initial public offering price of $9.50 per share. The
new warrants had a total value of approximately $43 million. We recorded the
actual value of the new warrants in a manner similar to that described above
whereby the total value was allocated to the investment in PC-1, MAC and PAC
based on their relative total contract costs.

 Our officers and directors

   Gary Winnick--Mr. Winnick, our founder, has been Chairman of our board of
directors since March 1997. Mr. Winnick is the founder and has been the
Chairman and Chief Executive Officer of Pacific Capital Group since 1985.

   Lodwrick M. Cook--Mr. Cook has been Co-Chairman of our board of directors
since September 1997 and Vice Chairman and Managing Director of Pacific
Capital Group since 1997. He became Chairman of Global Marine Systems in 1999.

   David L. Lee--Mr. Lee has been our President and Chief Operating Officer
and a director since March 1997. He has also been a managing director of
Pacific Capital Group since 1989.

   Abbott L. Brown--Mr. Brown has been our Senior Vice President and a
director since 1997. He had been a managing director and Chief Financial
Officer of Pacific Capital Group from 1994 to 1998.

   Barry Porter--Mr. Porter has been our Senior Vice President and a director
since 1997. He has also been a managing director of Pacific Capital Group
since 1993.

   Jay R. Bloom--Mr. Bloom, one of our directors since March 1997, is a
managing director of CIBC World Markets Corp. and co-head of its Leveraged
Finance Group. In addition, Mr. Bloom is a member of CIBC's U.S. Management
Committee; co-head of CIBC World Markets High Yield Merchant Banking Funds;
and a managing director of Caravelle Advisors, L.L.C., the investment advisor
to Caravelle Investment Fund, L.L.C., an entity that owns shares of Global
Crossing common stock.

   Dean C. Kehler--Mr. Kehler, one of our directors since March 1997, is a
managing director of CIBC World Markets Corp. and co-head of its Leveraged
Finance Group. In addition, Mr. Kehler is a member of CIBC's U.S. Management
Committee; co-head of CIBC World Markets High Yield Merchant Banking Funds;
and a managing director of Caravelle Advisors, L.L.C., the investment advisor
to Caravelle Investment Fund, L.L.C., an entity that owns shares of our common
stock.

                          DESCRIPTION OF COMMON STOCK

   We describe our common stock beginning on page 38 of the accompanying
prospectus.

                        CERTAIN INCOME TAX CONSEQUENCES

   We describe certain income tax consequences in connection with this
offering beginning on page 42 of the prospectus.

                                     S-21
<PAGE>

                                  UNDERWRITING

   We and the selling shareholders have entered into an underwriting agreement
with the underwriters named below, for whom Salomon Smith Barney Inc., Goldman,
Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated are acting
as representatives. Subject to the terms and conditions of the underwriting
agreement, we and the selling shareholders have agreed to sell, and each
underwriter severally and not jointly has agreed to purchase from us and the
selling shareholders, the number of shares of our common stock indicated
opposite its name below. The underwriters have agreed, subject to the terms and
conditions of the underwriting agreement, to purchase all of the shares of our
common stock offered on the cover page of this prospectus supplement, if any
are purchased. Under some circumstances, under the underwriting agreement, the
commitment of a non-defaulting underwriter may be increased.

<TABLE>
<CAPTION>
                                                                        Number
                               Underwriters                           of shares
                               ------------                           ----------
      <S>                                                             <C>
      Salomon Smith Barney Inc. .....................................
      Goldman, Sachs & Co. ..........................................
      Merrill Lynch, Pierce, Fenner & Smith
               Incorporated..........................................
                                                                      ----------
                                                                      58,000,000
                                                                      ----------
</TABLE>

   The underwriters have, for a period of 30 days from the date of this
prospectus supplement, an over-allotment option to purchase up to 8,700,000
additional shares from us and the selling shareholders. If the underwriters
exercise their over-allotment option, we and each selling shareholder will sell
those additional shares in proportion to the number of shares we are selling in
this offering. If any additional shares are purchased, the underwriters will
severally purchase the shares in the same proportion as in the table above.

   The representatives of the underwriters have advised us and the selling
shareholders that the shares will be offered to the public at the offering
price indicated on the cover page of this prospectus supplement. The
underwriters may allow to selected dealers a concession not in excess of $
per share and those dealers may reallow a concession not in excess of $   per
share to some other dealers. After the shares are released for sale to the
public, the representatives may change the offering price and the concessions.

   If any of the selling shareholders declines to participate in this offering,
each other selling shareholder will be offered the opportunity to ratably
increase the number of shares of common stock it will be entitled to sell in
the offering. Any of these shares that are declined by any other selling
shareholder will be offered to us.

   We and the selling shareholders have agreed to pay to the underwriters the
following fees, assuming both no exercise and full exercise of the
underwriters' over-allotment option to purchase additional shares:

<TABLE>
<CAPTION>
                                                    Total Fees
                                    -------------------------------------------
                            Price    Without exercise of    With exercise of
                          per share over-allotment option over-allotment option
                          --------- --------------------- ---------------------
<S>                       <C>       <C>                   <C>
Fees paid by us.........     $              $                     $
Fees paid by the selling
 shareholders...........     $              $                     $
</TABLE>

   In addition, we estimate that we will spend approximately $    in expenses
in this offering, including the expenses of the selling shareholders. We have
agreed to indemnify the underwriters against certain liabilities, including
liabilities under the Securities Act, or contribute to payments that the
underwriters may be required to make in respect of these liabilities. In
addition, subject to certain exceptions, the selling shareholders have agreed
to indemnify the underwriters against certain liabilities, including
liabilities under the Securities Act.

                                      S-22
<PAGE>

   In addition, under a registration rights agreement, dated August 12, 1998,
we have agreed to indemnify the selling shareholders, their controlling persons
and the officers, directors, agents and employees of the selling shareholders
and their controlling persons against certain liabilities, including
liabilities under the Securities Act, or contribute to payments that the
underwriters may be required to make in respect of these liabilities.

   Subject to specified exceptions, we have agreed not to offer or sell any
shares of our common stock or other equity securities for a period ending 45
days from the date of this prospectus supplement without the prior written
consent of Salomon Smith Barney Inc. and Goldman, Sachs & Co.

   Each of the selling shareholders has agreed, subject to specified
exceptions, not to offer or sell any shares of our common stock for a period
ending (1) 90 days from the date of this prospectus supplement, in the case of
selling shareholders who are executive officers or (2) May 25, 2000, in the
case of selling shareholders who are not executive officers, without the prior
written consent of Salomon Smith Barney Inc. and Goldman, Sachs & Co. on behalf
of the representatives of the underwriters. In addition, each of our other
executive officers has agreed, subject to specified exceptions, not to offer or
sell any shares of our common stock for a period ending 90 days from the date
of this prospectus supplement other than a specified number of shares of common
stock beneficially owned by those executive officers totalling 1,250,000 shares
in the aggregate, without the prior written consent of Salomon Smith Barney
Inc. and Goldman, Sachs & Co. on behalf of the representatives of the
underwriters.

   In connection with the offering, Salomon Smith Barney Inc., on behalf of the
underwriters, may purchase and sell shares of common stock in the open market.
These transactions may include over-allotment, syndicate covering transactions
and stabilizing transactions. Over-allotment involves syndicate sales of common
stock in excess of the number of shares to be purchased by the underwriters in
the offering, which creates a syndicate short position. Syndicate covering
transactions involve purchases of the common stock in the open market after the
distribution has been completed in order to cover syndicate short positions.
Stabilizing transactions consist of certain bids or purchases of common stock
made for the purpose of preventing or retarding a decline in the market price
of common stock while the offering is in progress.

   The underwriters also may impose a penalty bid. Penalty bids permit the
underwriters to reclaim a selling concession from a syndicate member when
Salomon Smith Barney Inc., in covering syndicate short positions or making
stabilizing purchases, repurchases shares originally sold by that syndicate
member.

   Any of these activities may cause the price of the common stock to be higher
than the price that otherwise would exist in the open market in the absence of
these transactions. These transactions may be effected on the Nasdaq National
Market or in the over-the-counter market, or otherwise and, if commenced, may
be discontinued at any time.

   Neither we nor the underwriters make any representation or prediction as to
the direction or magnitude of any effect that the transactions described above
may have on the price of the shares of our common stock. In addition, neither
we nor the underwriters make any representation that the underwriters will
engage in that type of transactions or that these transactions, once commenced,
will not be discontinued without notice.

   The underwriters and their affiliates have from time to time in the past or
may in the future perform certain investment banking advisory and financial
services for us and our affiliates, for which they have received or will
receive customary fees and expenses. Citibank, N.A., an affiliate of Salomon
Smith Barney Inc., is a lender to us under our existing credit facility.
Salomon Smith Barney Inc., Goldman, Sachs & Co. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated were initial purchasers of our 6 3/8% cumulative
convertible preferred stock and our 7% cumulative convertible preferred stock,
for which they received customary fees.

                                      S-23
<PAGE>

                                 LEGAL MATTERS

   The validity of our shares of common stock will be passed upon by our
counsel, Appleby, Spurling & Kempe, Hamilton, Bermuda. Certain legal matters
under United States and New York law with respect to the shares being offered
will be passed upon for us by Simpson Thacher & Bartlett, New York, New York
and for the underwriters by Latham & Watkins, New York, New York. Simpson
Thacher & Bartlett and Latham & Watkins will rely, as to matters of Bermuda
law, on the opinion of Appleby, Spurling & Kempe, Hamilton, Bermuda. As of
March 30, 2000, lawyers of Simpson Thacher & Bartlett who have participated in
the preparation of this document beneficially owned less than 1% of the
outstanding shares of our common stock.

                                    EXPERTS

   The consolidated financial statements of Global Crossing and its
subsidiaries incorporated by reference in this prospectus supplement and
elsewhere in the registration statement have been audited by Arthur Andersen,
independent public accountants, as indicated in their reports with respect to
those consolidated financial statements, and are incorporated by reference in
reliance upon the authority of said firm as experts in giving said reports.

   The consolidated financial statements incorporated by reference in this
registration statement of which this prospectus supplement is a part to the
annual report on Form 10-K of Frontier Corporation for the year ended December
31, 1998 and audited historical financial statements included on pages 22-42 of
Frontier Corporation's Form 8-K dated January 26, 1999, have been so
incorporated in reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.

   The combined financial statements of Global Marine Systems incorporated by
reference in this prospectus have been incorporated by reference in reliance
upon the report of KPMG Audit Plc, chartered accountants, incorporated by
reference in this prospectus and upon the authority of said firm as experts in
accounting and auditing.

   The financial statements of Racal Telecom incorporated by reference in this
registration statement of which this prospectus supplement is a part have been
audited by Deloitte & Touche, independent auditors, as stated in their report
incorporated by reference in this registration statement of which this
prospectus is a part.

   The consolidated financial statements incorporated by reference in this
registration statement of which this prospectus supplement is a part of HCL
Holdings Limited and subsidiaries have been so incorporated in reliance on the
reports of PricewaterhouseCoopers, independent accountants, given on the
authority of said firm as experts in auditing and accounting.

                                      S-24
<PAGE>

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

                               58,000,000 Shares

                                  Common Stock





                          [LOGO] Global Crossing Ltd.


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

                             PROSPECTUS SUPPLEMENT

                                       , 2000

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

                              Salomon Smith Barney
                              Goldman, Sachs & Co.
                              Merrill Lynch & Co.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the     +
+Securities and Exchange Commission is effective. This prospectus is not an    +
+offer to sell these securities and is not soliciting an offer to buy these    +
+securities in any state where the offer or sale is not permitted.             +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
                  Subject to completion, dated March 31, 2000

PROSPECTUS SUPPLEMENT
(To prospectus dated      , 2000)

                                3,000,000 Shares

[Logo Global Crossing Ltd.]

                    % Cumulative Convertible Preferred Stock

                                  ----------

  We are offering 3,000,000 shares of our  % cumulative convertible preferred
stock. Each share of preferred stock will have a liquidation preference of
$250.00 and will be convertible into     shares of our common stock, based on a
conversion price of $    . The conversion price will be adjusted in a number of
circumstances described in this prospectus supplement, including some changes
in control where the consideration paid per share of common stock is in excess
of the conversion price then in effect, in which case the conversion price will
be adjusted to increase the number of shares of common stock issuable upon
conversion.

  On and after    , 2005, we may cause the conversion rights to expire if the
price of our common stock has exceeded 140% of the conversion price for 20 of
any 30 trading days.

  Our common stock trades on the Nasdaq National Market and the Bermuda Stock
Exchange under the symbol "GBLX". On March 30, 2000, the closing sale price of
our common stock on the Nasdaq National Market was $43 5/16 per share.

  Dividends on the preferred stock are cumulative from the date of issue and
will be payable on    ,    ,      and     of each year, beginning on    , 2000,
at the annual rate of  %.

  We may redeem all or any shares of preferred stock at any time on or after
   , 2005 and, under specified circumstances, before that date. The preferred
stock will be subject to mandatory redemption on    , 2012.

  If we become subject to a change in control, any holder of our preferred
stock will have the right to cause us to purchase that holder's shares at 100%
of their liquidation value. We will have the option to pay for those shares in
shares of our common stock valued at 95% of their market value. However,
holders of our preferred stock will not have this right if our common stock
trades at or above 105% of the conversion price after our change in control.

                                  ----------

  Investing in our preferred stock involves risks, which we describe in the
"Risk Factors" sections beginning on page S-6 of this prospectus supplement and
page 20 of the prospectus that is also a part of this document.

                                  ----------

  Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.

                                  ----------

<TABLE>
<CAPTION>
                                                Per
                                               Share Total
                                               ----- -----
<S>                                            <C>   <C>
Public offering price (1)                      $     $
Underwriting discounts                         $     $
Proceeds, before expenses, to Global Crossing  $     $
</TABLE>
(1) Plus accrued dividends from      , 2000, if settlement occurs after that
date.

  The underwriters may also purchase up to an additional 450,000 shares from us
at the public offering price, less underwriting discounts, within 30 days from
the date of this prospectus supplement, to cover over-allotments.

  The preferred stock will be ready for delivery in book-entry form only
through the Depository Trust Company on       , 2000.

                                  ----------

                          Joint Book-Running Managers

Salomon Smith Barney                                        Goldman, Sachs & Co.

                               Joint Lead Manager

                              Merrill Lynch & Co.

                                  ----------

     , 2000
<PAGE>

   You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the prospectus that is also a part
of this document. We have not authorized anyone to provide you with different
information. We are not making an offer to sell these securities in any state
where the offer is not permitted. You should not assume that the information
contained in this prospectus supplement or the accompanying prospectus is
accurate as of any date other than the date on the front cover of these
documents.

                               TABLE OF CONTENTS

                             Prospectus Supplement

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
About This Prospectus Supplement...........................................   ii
Incorporation by Reference.................................................   ii
Summary....................................................................  S-1
Risk Factors...............................................................  S-6
Use of Proceeds............................................................ S-10
Dividend Policy............................................................ S-10
Price Range of Our Common Stock............................................ S-10
Capitalization ............................................................ S-11
Dilution .................................................................. S-12
Business................................................................... S-13
Description of Preferred Stock............................................. S-23
Certain Income Tax Consequences............................................ S-34
Underwriting............................................................... S-35
Legal Matters.............................................................. S-36
Experts.................................................................... S-37

                                   Prospectus

<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
About This Prospectus .....................................................   ii
Where You Can Find More Information........................................   ii
Incorporation by Reference.................................................   ii
Summary....................................................................    1
Risk Factors...............................................................   20
Cautionary Statement Regarding Forward-Looking Statements..................   27
Use of Proceeds............................................................   27
Dividend Policy............................................................   27
Description of Debt Securities.............................................   28
Description of Preferred Stock.............................................   36
Description of Common Stock................................................   38
Description of Warrants....................................................   40
Certain Income Tax Consequences............................................   42
Selling Shareholders.......................................................   55
Plan of Distribution.......................................................   56
Legal Matters..............................................................   58
Experts....................................................................   58
Service of Process and Enforcement of Liabilities..........................   58
</TABLE>

                                       i
<PAGE>

   The Bermuda Monetary Authority has given its consent to the issue and the
transfer of the shares of preferred stock that we may sell under this
prospectus supplement and the accompanying prospectus and the shares of common
stock into which those shares of preferred stock may be converted. Approvals or
permissions received from the Bermuda Monetary Authority do not constitute a
guaranty by the Bermuda Monetary Authority as to our performance or our credit
worthiness. Accordingly, in giving those approvals or permissions, the Bermuda
Monetary Authority will not be liable for our performance or default or for the
correctness of any opinions or statements expressed in this document.

   The Bermuda Monetary Authority has classified us as non-resident in Bermuda
for exchange control purposes. Accordingly, we may convert currency, other than
Bermuda currency, held for our account to any other currency without
restriction. Persons, firms or companies regarded as residents of Bermuda for
exchange control purposes require specific consent under the Exchange Control
Act, 1972 of Bermuda, and regulations promulgated under that Act, to purchase
any shares in our capital stock or any other securities that we may issue.
Under the terms of the consent given to us by the Bermuda Monetary Authority,
the issuance and transfer of the shares of our preferred stock that we may sell
under this prospectus supplement and the accompanying prospectus and the shares
of common stock into which those shares of preferred stock may be converted
between persons, firms or companies regarded as non-resident in Bermuda for
exchange control purposes may be effected without further permission from the
Bermuda Monetary Authority.

                        ABOUT THIS PROSPECTUS SUPPLEMENT

   This prospectus supplement is a supplement to the prospectus that is also a
part of this document. This prospectus supplement and the accompanying
prospectus are part of a registration statement that we filed with the SEC
using a shelf registration process. Under the shelf registration process, we
may offer from time to time debt securities, shares of preferred stock, shares
of common stock and warrants up to an aggregate amount of $8,000,000,000, of
which this offering is a part. In the accompanying prospectus, we provide you
with a general description of the securities we may offer from time to time
under our shelf registration statement. In this prospectus supplement, we
provide you with specific information about the shares of our preferred stock
we are selling in this offering. Both this prospectus supplement and the
prospectus include important information about us, our shares of preferred
stock being offered and other information you should know before investing.
This prospectus supplement also adds, updates and changes information contained
in the prospectus. You should read both this prospectus supplement and the
prospectus as well as additional information described under "Incorporation by
Reference" immediately below before investing in our shares of preferred stock.

                           INCORPORATION BY REFERENCE

   The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. We incorporate by reference in this
prospectus supplement and the accompanying prospectus the information we
indicate under "Incorporation by Reference" on page ii of the prospectus.

   You may obtain copies of those documents from us, free of cost, by
contacting us at the address or telephone number provided in "Where You Can
Find More Information" on page ii of the prospectus.

   Information that we file later with the SEC and that is incorporated by
reference in this prospectus supplement and the accompanying prospectus will
automatically update and supersede information contained in this prospectus
supplement and the prospectus. You will be deemed to have notice of all
information incorporated by reference in this prospectus supplement and the
prospectus as if that information was included in this prospectus supplement or
the prospectus.

                                       ii
<PAGE>

                                    SUMMARY

   This section contains a general summary of the information contained in this
prospectus supplement. It may not include all the information that is important
to you. You should read the entire prospectus supplement and the accompanying
prospectus and the documents incorporated by reference before making an
investment decision.

                              Global Crossing Ltd.

   We are building and offering services over the world's first integrated
global fiber optic network, consisting of 101,000 announced route miles and
serving five continents, 27 countries and more than 200 major cities. Upon
completion of our currently announced systems, our network and its
telecommunications and Internet product offerings will be available in markets
constituting over 80% of the world's international communications traffic.

   We are included in both the S&P 500 index and the Nasdaq 100 index. Our
operations are headquartered in Hamilton, Bermuda, with executive offices in
Los Angeles, California; Morristown, New Jersey; and Rochester, New York.

   We are incorporated in Bermuda, and the address of our principal executive
offices is Wessex House, 45 Reid Street, Hamilton HM12, Bermuda. Our telephone
number is 441-296-8600. You may visit us at our web site located at
www.globalcrossing.com.

                              Recent Developments

   On March 2, 2000, we announced plans to create a new class of common stock
that will track the performance of our complex web hosting business operated by
our wholly-owned subsidiary, GlobalCenter Inc. The creation of this new class
of common stock will be subject to shareholder approval. We expect to complete
this transaction in the summer of 2000, subject to market conditions.

   Our subsidiary, Asia Global Crossing, intends to do an initial public
offering of shares of its common stock and to file a registration statement
under the Securities Act of 1933 in respect of the proposed offering. Asia
Global Crossing intends to use the net proceeds from the offering primarily to
make additional capital investments in its operations and for general corporate
purposes. Asia Global Crossing anticipates that the offering will be completed
in the summer of 2000, subject to market conditions. The statements in this
paragraph do not constitute an offer of any securities for sale. The offering,
if made, will be made only by means of a prospectus contained in the
registration statement as filed with the SEC.

                                      S-1
<PAGE>

                                  The Offering

Issuer......................  Global Crossing Ltd., a Bermuda company

Securities offered..........  3,000,000 shares of   % cumulative convertible
                              preferred stock

Over-allotment option.......  Up to an additional 450,000 shares of preferred
                              stock

Liquidation preference......  $250.00 per share

Dividends...................     .  Dividend rate:  % of the liquidation
                                    preference per annum on a cumulative basis
                                    from the date of issuance

                                 .  Dividend payment dates: quarterly, on
                                           ,       ,        and         of
                                    each year, beginning on         , 2000

                                 .  Type of dividend: Holders will receive
                                    cash. We will have the option to deliver
                                    shares of our common stock to the transfer
                                    agent for the preferred stock, which will
                                    resell those shares of common stock and
                                    use the proceeds to pay cash dividends to
                                    the holders of shares of preferred stock.

Conversion..................  Each share of preferred stock may be converted,
                              at the option of the holder, into        shares
                              of our common stock.

                                 .  Conversion price: $     , subject to
                                    adjustment in a number of circumstances
                                    described under "Description of Preferred
                                    Stock--Adjustments to the Conversion
                                    Price" on page S-29, including some
                                    changes in control where the consideration
                                    paid per share of common stock is in
                                    excess of the conversion price then in
                                    effect, in which case the conversion price
                                    will be adjusted to increase the number of
                                    shares of common stock issuable upon
                                    conversion.


                              The right to convert shares that have been called
                              for redemption will terminate on the close of
                              business on the business day immediately
                              preceding the redemption date.

Termination of conversion     On or after    , 2005, we may, at our option,
rights......................  cause the conversion rights of our shares of
                              preferred stock to terminate. We may exercise
                              this option only if for at least 20 trading days
                              within any period of 30 consecutive trading days,
                              including the last trading day of that period,
                              the current market price of our common stock
                              exceeds 140% of the conversion price, subject to
                              adjustment in a number of circumstances as
                              provided under "Description of Preferred Stock--
                              Adjustments to the Conversion Price" on
                              page S-29.

Non-mandatory redemption....  We may redeem for cash all or any part of the
                              shares of preferred stock in the following cases:

                                      S-2
<PAGE>


                                 1.Optional redemption:

                                    .  Redemption period: at any time after
                                          , 2005, at our option

                                    .  Redemption price:      % of the
                                       liquidation preference if we redeem the
                                       shares in 2005, and thereafter this
                                       percentage gradually declines to 100%
                                       on and after    , 2010, plus
                                       accumulated and unpaid dividends to the
                                       redemption date

                                 2.Tax redemption:

                                    .  Redemption period: at any time, at our
                                       option, if we are required to pay
                                       additional amounts to the holders of
                                       the shares of preferred stock to offset
                                       specified adverse tax consequences
                                       resulting from a change in applicable
                                       laws or regulations

                                    .  Redemption price: 100% of the
                                       liquidation preference, plus accrued
                                       and unpaid dividends to the redemption
                                       date

Mandatory redemption........  We will be obligated to redeem the shares of
                              preferred stock on    , 2012 at 100% of their
                              liquidation value plus accumulated and unpaid
                              dividends to that date.

Change in control put         If we become subject to a change in control, each
right.......................  holder of shares of preferred stock will have the
                              right to require us to purchase any or all of the
                              shares of that holder at a purchase price in cash
                              equal to 100% of the liquidation preference, plus
                              accumulated and unpaid dividends to the date of
                              purchase. This right of holders will be subject
                              to our obligation to offer to repay a substantial
                              portion of our own and our subsidiaries'
                              indebtedness and offer to redeem outstanding
                              shares of a series of preferred stock of a
                              subsidiary that are tendered for redemption in
                              connection with a change in control of Global
                              Crossing. When we have satisfied these
                              obligations and, subject to the legal
                              availability of funds for this purpose, we will
                              purchase all shares tendered upon a change in
                              control. We will have the option to pay for those
                              shares in shares of our common stock valued at
                              95% of the average closing sale price of our
                              common stock for the five trading days before and
                              including the third trading day before the
                              repurchase date. However, holders of our
                              preferred stock will not have this right if our
                              common stock trades at or above 105% of the
                              conversion price after our change in control.

Voting rights...............  The holders of preferred stock will not be
                              entitled to any voting rights, except:

                                 .  as required by law;
                                 .  to approve amendments to the certificate
                                    of designations of the preferred stock
                                    which would adversely affect, alter or
                                    change the powers, preferences or special
                                    rights of the preferred stock; and

                                      S-3
<PAGE>


                                 .  if six quarterly dividends on the shares
                                    of preferred stock are accrued and unpaid,
                                    the holders of shares of preferred stock,
                                    voting as a single class with holders of
                                    other series of preferred stock that rank
                                    equally or senior to the preferred stock
                                    and have similar voting rights, will be
                                    entitled to elect at the next annual
                                    shareholder meeting two directors on our
                                    board to serve until all accumulated and
                                    unpaid dividends have been paid or
                                    declared and funds have been set aside for
                                    their payment.

Ranking.....................
                              The preferred stock will be, with respect to
                              dividend rights and upon liquidation, winding up
                              or dissolution:

                                 .  junior to all our existing and future debt
                                    obligations;

                                 .  junior to each other class or series of
                                    our capital stock other than (a) our
                                    common stock and any other class or series
                                    of our capital stock the terms of which
                                    provide that that class or series will
                                    rank junior to the preferred stock and (b)
                                    any other class or series of our capital
                                    stock the terms of which provide that that
                                    class or series will rank on a parity with
                                    the preferred stock;

                                 .  on a parity with each class or series of
                                    our capital stock the terms of which
                                    provide that that class or series will
                                    rank on a parity with the preferred stock,
                                    including (a) $1.0 billion of our 6 3/8%
                                    cumulative convertible preferred stock
                                    which we issued in a private placement on
                                    November 5, 1999, (b) $400 million of our
                                    6 3/8% cumulative convertible preferred
                                    stock, series B, which we issued to
                                    Hutchison Whampoa Limited upon completion
                                    of the transaction described in the second
                                    paragraph under "-- Selected historical
                                    financial information" on page 2 of the
                                    prospectus and (c) $650,000,000 of our 7%
                                    cumulative preferred stock which we issued
                                    in a private placement on December 15,
                                    1999; and

                                 .  senior to our common stock and any other
                                    class or series of our capital stock the
                                    terms of which provide that that class or
                                    series will rank junior to the preferred
                                    stock.

Use of proceeds.............  We intend to use the net proceeds of this
                              offering for general corporate purposes,
                              principally capital for the expansion of our
                              business. We may also use a portion of the net
                              proceeds to fund acquisitions of complimentary
                              businesses, products or technologies or to make
                              strategic investments.

Trading.....................
                              Our common stock currently trades on the Nasdaq
                              National Market and the Bermuda Stock Exchange
                              under the symbol "GBLX". We have not applied and
                              do not intend to apply for the listing of the
                              preferred stock on any securities exchange.

                                      S-4
<PAGE>


                              Concurrent Offering

   Concurrently with this offering, we are also offering shares of our common
stock under a separate prospectus supplement. We expect that the aggregate
gross proceeds of our common stock offering, if consummated, will be
approximately $1.2 billion. Neither offering is conditioned on the other.

                   Selected historical financial information

   On pages 2 through 11 of the accompanying prospectus, we provide selected
historical financial information for (1) us, (2) the Global Marine Systems
business of Cable & Wireless Plc, which we acquired on July 2, 1999, (3)
Frontier Corporation, which we acquired on September 28, 1999, (4) Racal
Telecom, a group of wholly-owned subsidiaries of Racal Electronics plc, which
we acquired on November 24, 1999 and (5) HCL Holdings Limited, a group of
wholly-owned subsidiaries of Hutchison Whampoa, which has been contributed to
our Hutchison Global Crossing joint venture.

                              Global Crossing Ltd.
               Selected unaudited pro forma financial information

   On pages 13 through 19 of the accompanying prospectus, we provide unaudited
pro forma condensed combined financial information of Global Crossing, Global
Marine Systems, Frontier, Racal Telecom and the Hutchison Global Crossing joint
venture.

                                      S-5
<PAGE>

                                  RISK FACTORS

   Before investing in our shares of common stock, you should carefully
consider the risks described below and in the accompanying prospectus, as well
as the other information included or incorporated by reference in this
prospectus supplement and the prospectus. The prospectus includes important
risk factors relating to our business beginning on page 20.

Risk Factors Relating to the Preferred Stock

The preferred stock is subordinated to all our existing indebtedness and will
not limit our ability to incur future indebtedness that will rank senior to the
preferred stock.

   The preferred stock will be subordinated to all our indebtedness with
respect to the payments of interest and amounts distributable upon our
dissolution, liquidation or winding up. The terms of the preferred stock will
not limit the amount of indebtedness or other obligations that we may incur.
Further, we may incur additional indebtedness in order to finance the
construction or acquisition of additional fiber optic and telecommunications
systems and equipment. That indebtedness will rank senior to the preferred
stock.

The preferred stock is structurally subordinated to the obligations of our
subsidiaries.

   Because we are a holding company and our assets consist primarily of our
equity interests in our operating subsidiaries, our obligations on the
preferred stock will be structurally subordinated to all liabilities of our
operating subsidiaries. At December 31, 1999, we and our operating subsidiaries
had approximately $5,019 million principal amount of long-term indebtedness, of
which $1,295 million was secured, and approximately $1,853 million of current
liabilities and vendor financing ranking senior to our equity interests in our
operating subsidiaries.

   We cannot assure you that, in the event of our dissolution, liquidation,
reorganization or winding up, you will receive any portion of your initial
investment.

We are currently restricted from paying cash dividends and from redeeming the
shares of preferred stock. We also could be prevented in some circumstances
from paying dividends in shares of our common stock.

   The terms of the instruments governing our indebtedness and an outstanding
series of preferred stock of Global Crossing Holdings restrict our ability to
pay cash dividends and to redeem our shares of preferred stock. Our ability to
pay cash dividends and redeem our shares of preferred stock will depend on our
meeting certain financial criteria, which in turn will require significant
improvements in our EBITDA and consolidated net worth. Even if the terms of the
instruments governing our indebtedness and preferred stock of Global Crossing
Holdings allow us to pay cash dividends and to redeem our shares of preferred
stock, we can make those payments only from our "surplus", that is the excess
of our total assets over the sum of our liabilities plus the par value of our
outstanding capital stock and any share premium attributable to our outstanding
capital stock. In addition, we can make cash dividends only if we would, after
paying those dividends, be able to pay our liabilities as they become due. We
cannot assure you that we will have any surplus. The same test applies before
we can pay dividends in shares of our common stock.

Our ability to issue senior preferred stock in the future could adversely
affect the rights of holders of preferred stock and our common stock.

   We are authorized to issue additional preferred stock in one or more series
on terms that may be determined at the time of issuance by our board of
directors. In some instances, a series of preferred stock

                                      S-6
<PAGE>

could include voting rights, preferences as to dividends and liquidation,
conversion and redemption rights that will rank senior to the preferred stock,
and in all instances, senior to our common stock. The future issuance of
preferred stock could effectively diminish or supersede the dividends and
liquidation preferences of the preferred stock and adversely affect our common
stock.

We cannot assure you that an active trading market will develop for the
preferred stock.

   There is no market for the preferred stock. In addition, the liquidity of
any trading market in the preferred stock, and the market price quoted for
shares of preferred stock, may be adversely affected by changes in the overall
market for convertible securities and by changes in our financial performance
or prospects or in the prospects of companies in our industry generally. As a
result, we cannot assure you that an active trading market will develop for the
preferred stock, or, if one develops, that the shares of preferred stock will
trade at prices higher than the initial offering price.

We may not have sufficient funds to purchase any shares of preferred stock upon
a change in control.

   If we become subject to a change in control, subject to limited exceptions,
each holder of shares of preferred stock will have the right to require us to
purchase all or any part of that holder's shares of preferred stock at a
purchase price in cash equal to 100% of the liquidation preference of those
shares, plus all accumulated and unpaid dividends on those shares to the date
of purchase. We will have the option to pay for those shares in shares of our
common stock valued at 95% of the average closing sale price of our common
stock for the five trading days before and including the third trading day
before the repurchase date.

   This right of holders is subject to the obligation of Global Crossing
Holdings to (a) repay its debt obligations in full under its corporate credit
facility and (b) purchase all of its senior notes and outstanding shares of
preferred stock that have been tendered for purchase in connection with a
change in control of Global Crossing. In addition, this right of holders is
subject to the repurchase or repayment of our future indebtedness which we are
required to repurchase or repay in connection with a change in control.

   If Global Crossing Holdings is unable to satisfy the obligations described
in the paragraph above, we can either purchase shares of preferred stock that
have been tendered to us upon a change in control of Global Crossing in
violation of our debt agreements and covenants in connection with the senior
notes and preferred stock of Global Crossing Holdings or choose not to purchase
any shares of preferred stock. We cannot assure you that Global Crossing
Holdings will have sufficient funds available at the time of a change in
control to meet those obligations.

   A change in control of Global Crossing may also be an event of default under
our other debt agreements and require repayment of that debt in whole or in
part as a result of acceleration or otherwise. In that circumstance, we may not
have access to sufficient cash to purchase shares of preferred stock tendered
to us upon a change in control.

Risk Factors Relating to Our Common Stock

We do not plan on paying dividends in the foreseeable future and, as a result,
you will need to sell shares to realize a return on your investment.

   We do not anticipate paying cash dividends on our common stock in the
foreseeable future. Our ability to pay dividends is limited by some of our debt
instruments. Consequently, you will need to sell shares of our common stock to
realize a return on your investment, if any.

                                      S-7
<PAGE>

Our stock performance may be volatile.

   Historically, the market prices for securities of companies in the
telecommunications industry have been highly volatile. A number of factors
could cause the market price of our common stock to fluctuate substantially,
including:

  .  quarterly variations in operating results;

  .  competition;

  .  announcements of technological innovations or new products by us or our
     competitors;

  .  product enhancements by us or our competitors;

  .  regulatory changes;

  .  any differences in actual results and results expected by investors and
     analysts;

  .  changes in financial estimates by securities analysts; and

  .  other events or factors.

   In addition, the stock market has experienced volatility that has affected
the market prices of equity securities of many companies, and that often has
been unrelated to the operating performance of these companies. These broad
market fluctuations may adversely affect the market price of our common stock.

Future sales of our common stock may negatively affect our stock price.

   Future sales of our common stock in the public market could cause our stock
price to decline and could impair our ability to raise funds in new stock
offerings. Assuming our concurrent common stock offering is completed, without
counting (1) any shares that may be issued if the underwriters exercise their
over-allotment option in that offering or (2) the shares of our common stock
into which the shares of preferred stock we are offering under this prospectus
supplement will be convertible, we will have approximately 808,714,470 shares
of common stock outstanding and 96,239,506 shares issuable upon exercise of
outstanding options and warrants. A substantial number of these shares are
"restricted shares" or are held by our affiliates and, accordingly, may not be
sold publicly except in compliance with Rule 144. In addition, each of our
executive officers and selling shareholders has agreed, subject to specified
exceptions, not to offer or sell any shares of our common stock for a period
ending (1) 90 days from the date of this prospectus supplement, in the case of
our executive officers or (2) May 25, 2000, in the case of selling shareholders
who are not executive officers, without the prior written consent of Salomon
Smith Barney Inc. and Goldman, Sachs & Co. on behalf of the representatives of
the underwriters. However, a significant percentage of these shares are freely
tradeable immediately after completion of this offering. Sales of a substantial
amount of common stock in the public market, or the perception that sales may
occur, could adversely affect the market price of our common stock prevailing
from time to time in the public market and could impair our ability to raise
funds in additional stock offerings.

You will experience an immediate and substantial dilution if you convert your
shares of preferred stock into shares of common stock, because the per share
conversion price of your shares of preferred stock is substantially higher than
the net tangible book value per share of our common stock.

   If you convert your shares of preferred stock into shares of common stock,
you will experience an immediate and substantial dilution because the per share
conversion price of your shares of preferred stock is substantially higher than
the net tangible book value per share of the outstanding common stock
immediately after this offering. In addition, to the extent that outstanding
options and warrants to purchase common stock are exercised, there could be
substantial additional dilution.

                                      S-8
<PAGE>

You will also experience dilution when we issue additional shares of common
stock that we are permitted or required to issue under options, warrants, our
stock option plan and our outstanding convertible preferred stock.

   You should be aware that we are permitted, and in some cases obligated, to
issue shares of our common stock in addition to the common stock that the
shares of preferred stock we are offering under this prospectus supplement may
be converted into. If and when we issue those shares, the percentage of our
common stock into which your shares of preferred stock may be converted will be
diluted. The following is a summary of additional shares of our common stock
that we have reserved for issuance as of December 31, 1999:

  .  78,639,506 shares are issuable upon the exercise of options or other
     benefits under our stock option plan at a weighted average price of
     $18.76 per share, of which options covering 33,592,901 shares were
     exercisable as of December 31, 1999;

  .  17,600,000 shares are issuable upon the exercise of outstanding warrants
     at a weighted average exercise price of $9.50 per share; and

  .  35,317,360 shares are issuable upon conversion of all outstanding shares
     of our convertible preferred stock, not including any shares of our
     common stock into which shares of preferred stock we are offering under
     this prospectus supplement will be convertible.


                                      S-9
<PAGE>

                                USE OF PROCEEDS

   We estimate the net proceeds from the sale of shares of our preferred stock
in this offering will be approximately $725 million, after deducting
underwriting discounts and commissions and our estimated offering expenses.

   We plan to use our net proceeds from this offering for general corporate
purposes, principally capital for the expansion of our business. We may also
use a portion of the net proceeds of this offering to fund acquisitions of
complementary businesses, products or technologies or to make strategic
investments. Currently, there are no material commitments or understandings
with respect to any such transactions. Pending those uses, we intend to invest
those funds in short-term, investment-grade, interest-bearing instruments. We
do not believe we can accurately estimate the amounts to be used for each
purpose at this time.

                                DIVIDEND POLICY

   We do not anticipate paying dividends on our common stock in the foreseeable
future. The terms of some of our debt instruments place limitations on our
ability to pay dividends. Future dividends on our common stock, if any, will be
at the discretion of our board of directors and will depend on, among other
things, our operations, capital requirements and surplus, general financial
condition, contractual restrictions and such other factors as our board of
directors may deem relevant.

                        PRICE RANGE OF OUR COMMON STOCK

   Our common stock has traded on the Nasdaq National Market under the symbol
"GBLX" since our initial public offering in August 1998. The table below
presents, for the calendar quarters indicated, the high and low per share
closing sale prices of our common stock as reported in the Nasdaq National
Market. Share values take into account the two-for-one stock split in the form
of a stock dividend effective March 9, 1999. The third quarter 1998 information
covers the period between August 14, the date of our initial public offering,
through September 30.

<TABLE>
<CAPTION>
                                                                   High   Low
                                                                  ------ ------
<S>                                                               <C>    <C>
Calendar 1998
  Third Quarter.................................................. $12.91 $ 8.00
  Fourth Quarter.................................................  24.28   8.00
Calendar 1999
  First Quarter..................................................  62.63  18.94
  Second Quarter.................................................  64.25  39.63
  Third Quarter..................................................  50.00  20.25
  Fourth Quarter.................................................  55.75  24.81
Calendar 2000
  First Quarter (through March 30, 2000)......................... $61.06 $43.06
</TABLE>

   On March 30, 2000, the reported closing sale price of our common stock on
the Nasdaq National Market was $43 5/16 per share.

                                      S-10
<PAGE>

                                 CAPITALIZATION

   The following table presents as of December 31, 1999 (1) our actual
consolidated capitalization, (2) our capitalization as adjusted to reflect this
offering of shares of our preferred stock and (3) our capitalization as
adjusted to reflect this offering of shares of our preferred stock and the
concurrent offering of shares of our common stock. The table below assumes a
selling price per share of common stock of $43 5/16, which was the closing sale
price of our common stock on March 30, 2000.

   You should read this table in conjunction with the "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the
consolidated financial statements and the accompanying notes incorporated by
reference in this prospectus supplement.

<TABLE>
<CAPTION>
                                              As of December 31, 1999
                                       ----------------------------------------
                                                                  As adjusted
                                                                    for this
                                                    As adjusted   offering and
                                                     for this    the concurrent
                                         Actual      offering       offering
                                       -----------  -----------  --------------
                                                   (in thousands)
<S>                                    <C>          <C>          <C>
Long-Term Debt........................ $ 5,018,544  $ 5,018,544   $ 5,018,544
Mandatorily Redeemable and Cumulative
 Convertible
 Preferred Stock:
  10 1/2% Mandatorily redeemable
   preferred stock....................     485,947      485,947       485,947
  6 3/8% Cumulative convertible
   preferred stock....................     969,000      969,000       969,000
     % Cumulative convertible
   preferred stock....................         --       725,000       725,000
  7% Cumulative convertible preferred
   stock..............................     629,750      629,750       629,750
                                       -----------  -----------   -----------
                                         7,103,241    7,828,241     7,828,241
                                       -----------  -----------   -----------
Shareholders' Equity:
  Common stock........................       7,992        7,992         8,282
  Treasury stock......................    (209,415)    (209,415)     (209,415)
  Additional paid-in capital and other
   shareholders' equity...............   9,578,927    9,578,927    10,792,018
  Retained earnings...................    (158,989)    (158,989)     (158,989)
                                       -----------  -----------   -----------
    Total Shareholders' equity........   9,218,515    9,218,515    10,431,896
                                       -----------  -----------   -----------
    Total Capitalization.............. $16,321,756  $17,046,756   $18,260,137
                                       ===========  ===========   ===========
</TABLE>

                                      S-11
<PAGE>

                                    DILUTION

   Our net tangible book value at December 31, 1999 was approximately $(339)
million or $(0.42) per share of common stock. Net tangible book value per share
represents the amount of our tangible assets, meaning (1) total assets less
intangible assets, (2) reduced by our total liabilities and our mandatorily
redeemable preferred stock and (3) divided by the number of shares of common
stock outstanding.

   After giving effect to   shares of our common stock covered by this
prospectus supplement related to the conversion of the preferred stock at the
conversion price of $   per share, our adjusted net tangible book value as of
December 31, 1999 would have been approximately $     or $   per share. This
represents an immediate increase in net tangible book value of $   per share to
existing shareholders and an immediate dilution of $   per share to new
investors purchasing shares of our common stock under this prospectus. The
following table illustrates this per share dilution:

<TABLE>
       <S>                                                           <C>     <C>
       Conversion price per share..................................          $
         Net tangible book value per share before the conversions..  $(0.42)
         Increase per share attributable to conversions under this
          prospectus...............................................  $
                                                                     ------
       Adjusted net tangible book value per share after the
        conversions................................................          $
                                                                             ---
       Dilution per share to new investors.........................          $
                                                                             ===
</TABLE>

   The above analysis does not give effect to any shares of common stock we are
selling in a concurrent offering.

                                      S-12
<PAGE>

                                    BUSINESS

Business Strategy

   Our strategy is to be the premier provider of global Internet Protocol,
which we refer to as "IP", and data services for both wholesale and retail
customers. We are building a state-of-the-art fiber optic network that we
believe to be of unprecedented global scope and scale to serve as the backbone
for this strategy. We believe that our network will enable us to be the low
cost service provider in most of our addressable markets.

   We offer a variety of voice, data and Internet services throughout most of
North America and Europe. During 2000, we intend to aggressively roll out
similar services in Asia, Mexico, Central America and South America.

   In Asia, we will offer these services through our Asia Global Crossing joint
venture with Softbank Corp. and Microsoft Corporation. Asia Global Crossing
aims to become the first truly pan-Asian carrier to offer worldwide bandwidth
and data communications. We believe that Asia Global Crossing will be uniquely
positioned to take advantage of the anticipated explosive growth and
increasingly favorable regulatory environment in the Asian telecommunications
markets.

   In each of our businesses, we intend to expand significantly our current
product offerings, with an increasing focus on value-added services. In
particular, our GlobalCenter subsidiary will expand its product set to become a
single-source e-commerce service solution that will provide web-centric
businesses with the high availability, flexibility and scalability necessary to
compete in the rapidly expanding digital economy.

Business Combinations

   We established the Asia Global Crossing joint venture on November 24, 1999.
We contributed to the joint venture our development rights in East Asia
Crossing, an approximately 11,000 mile undersea network that will link several
countries in eastern Asia, and our 58% interest in Pacific Crossing, an
undersea system connecting the United States and Japan. Softbank and Microsoft
each contributed $175 million in cash to Asia Global Crossing. In addition,
Softbank and Microsoft committed to make a total of at least $200 million in
capacity purchases on our network over a three-year period, expected to be
utilized primarily on our Pacific Crossing and East Asia Crossing systems.
Softbank and Microsoft have also agreed to use Asia Global Crossing's network
in the region, subject to specified conditions.

   Also on November 24, 1999, we completed our acquisition of Racal Telecom, a
group of wholly-owned subsidiaries of Racal Electronics plc, for approximately
$1.6 billion in cash. Racal Telecom owns one of the most extensive fiber
telecommunications networks in the United Kingdom, consisting of approximately
4,650 route miles of fiber and reaching more than 2,000 cities and towns.

   On September 28, 1999, we completed the acquisition of Frontier Corporation
in a merger transaction valued at over $10 billion, with Frontier shareholders
receiving 2.05 shares of our common stock for each share of Frontier common
stock. Frontier is one of the largest long distance telecommunications
companies in the United States and one of the leading providers of facilities-
based integrated communications and Internet services.

   On July 2, 1999, we completed our acquisition of the Global Marine Systems
division of Cable & Wireless Plc for approximately $908 million in cash and
assumed liabilities. Global Marine Systems owns the largest fleet of cable
laying and maintenance vessels in the world and currently services more than a
third of the world's undersea cable miles.

                                      S-13
<PAGE>

Recent Developments

   On March 2, 2000, we announced that Leo Hindery had succeeded Robert
Annunziata as our Chief Executive Officer. Mr. Hindery will also continue to
serve as Chief Executive Officer of our GlobalCenter subsidiary that provides
complex web hosting and Internet infrastructure services. Mr. Annunziata will
continue as one of our directors. In addition, on March 2, 2000, we also
announced our intentions to create a tracking stock for GlobalCenter, which
will continue to complement our worldwide operations.

   On February 29, 2000, we announced that we had concluded an agreement to
provide substantial additional capacity to Deutsche Telekom AG. Total capacity
sold to Deutsche Telekom is now 35 gigabits per second, or "Gbps", on our
Atlantic Crossing fiber-optic system that provides a link between North America
and Germany.

   On February 22, 2000, we announced a definitive agreement to acquire IXnet,
Inc., a leading provider of specialized IP-based network services to the global
financial services community, and its parent company, IPC Communications, Inc.,
in exchange for shares of our common stock valued at approximately $3.8
billion. Under the terms of the definitive merger agreement, 1.184 of our
shares will be exchanged for each IXnet share not owned by IPC, and 5.417 of
our shares will be exchanged for each share of IPC. We expect to complete the
acquisition in the second quarter of 2000. That acquisition is subject to
regulatory approval and customary closing conditions.

   On January 26, 2000, our Asia Global Crossing joint venture announced an
agreement to create GlobalCenter Japan, a joint venture with Japan's Internet
Research Institute, Inc., which we refer to as "IRI". GlobalCenter Japan will
design, develop and construct a media distribution center in Japan providing
connectivity worldwide through our network. The joint venture will also develop
and provide complex web hosting services, e-commerce support and applications
hosting solutions. Asia Global Crossing will own 89% of GlobalCenter Japan,
with IRI owning the remaining 11%.

   January 12, 2000, we established a joint venture, called Hutchison Global
Crossing, with Hutchison Whampoa Limited to pursue fixed-line
telecommunications and Internet opportunities in Hong Kong. For its 50% share,
Hutchison Whampoa contributed to the joint venture its building-to-building
fixed-line telecommunications network in Hong Kong and a number of Internet-
related assets. In addition, Hutchison Whampoa has agreed that any fixed-line
telecommunications activities it pursues in China will be carried out by the
joint venture. For our 50% share, we provided to Hutchison Whampoa $400 million
in our convertible preferred stock, convertible into shares of our common stock
at a rate of $45 per share, and committed to contribute to the joint venture
international telecommunications capacity rights on our network and certain
media distribution center capabilities, which together are valued at $350
million, as well as $50 million in cash. We intend to integrate our interest in
Hutchison Global Crossing into Asia Global Crossing.

Services

 General

   We provide services in three principal segments. Our telecommunications
services segment offers a variety of integrated telecommunications products and
services to customers through our global fiber optic network. Our installation
and maintenance services segment, consisting of our Global Marine Systems
subsidiary, installs and maintains undersea fiber optic cable systems to
carrier customers worldwide. Finally, our incumbent local exchange carrier,
which we refer to as "ILEC", services segment provides local communications
services through local exchange service providers in 13 states, serving over
one million access lines.

 Telecommunications services

   We provide a variety of integrated telecommunications and Internet-based
products designed to meet our customer's total communications needs. We provide
domestic and international voice services, data products, Internet-based
services, structured bandwidth services and other communications products to
primarily small to mid-size business customers, web-centric businesses and
other telecommunication carriers. Beginning in 2000,

                                      S-14
<PAGE>

we will begin marketing products more intensely to large multinational
customers who have bandwidth-intensive applications and international
requirements. Those customers demand global end-to-end solutions. We believe we
are well positioned to address this market due to the international scope and
broadband capacity of our network along with the flexibility of product pricing
to maintain competitiveness.

   We offer the following products and services to our customers:

  .  Voice: Switched and dedicated outbound voice services for local,
     domestic, and international traffic.

  .  Data Transport: Point-to-point data services in a number of products,
     including private line, ATM, frame relay, X.25 and Internet access, and
     varying bandwidth sizes, from fractional T-1 to OC-192.

  .  Virtual Private Network or "VPN": Customizable network solutions where
     our customers create a private network by using our network without
     purchasing dedicated facilities. In addition, customers have flexibility
     to change capacity requirements between points over time and reconfigure
     their VPNs to meet changing requirements.

  .  International Private Line or "IPL": Expanded services providing retail
     customers greater flexibility at reduced cost. We currently provide
     access to New York, London, Amsterdam, Frankfurt, Paris and Tokyo, with
     access expected to be available to 18 additional cities within the next
     six months.

  .  Web Hosting Services: A combination of digital distribution services,
     server co-location, equipment sales, consulting services and
     professional expertise aimed at supporting customers' mission critical
     Internet operations. This product is easily scalable to meet customer
     needs and is marketed primarily by our GlobalCenter subsidiary.

  .  Advanced Voice and Data Services: These services combine traditional
     voice or data products with additional features. Products include
     calling card, 800/888 toll free services, voice mail, audio
     conferencing, video conferencing and broadcast fax.

  .  Advanced Internet Services: Products include basic dial-up and dedicated
     Internet access along with web-based applications, such as e-mail
     hosting, unified messaging, off-site data storage and backup.

  .  Structured Bandwidth Services: Historically, we have sold capacity on
     our systems on an indefeasible right of use, or "IRU", basis, whereby
     the customer purchased a unit of point to point capacity for the
     expected economic life of the system, typically in increments of 155
     megabits per second, or "Mbps", a unit known as an STM-1. However, with
     the consummation of our acquisition of Frontier in September 1999, we
     have begun to derive a significant source of revenue from service
     offerings involving leases of capacity on our systems in smaller
     increments and for periods significantly shorter than the expected
     useful life of the system. From time to time, we also engage in sales of
     "dark" fiber, i.e., fiber that has not been equipped with the electronic
     components necessary for telecommunications transmission.

     Payment for long-term leases of capacity or dark fiber is typically made
     in advance of activation, although in some cases a customer's payments
     are made in installments over two to four years. For short-term
     bandwidth services, customers are typically billed on a monthly basis.

     Due to the breadth of our network, we are uniquely positioned to offer
     worldwide capacity to our customers. Many customers acknowledge that
     their need for large bandwidth is increasing, but they are often
     uncertain with regard to the precise routes where their particular
     growth will take place. In order to stimulate customer loyalty and
     leverage this uncertainty, we have developed the Global Crossing network
     offer, which allows customers who can make a multi-year commitment the
     flexibility to activate capacity where needed, in a "just-in-time"
     manner, in return for volume discounted pricing. As our network
     continues to expand, we are exploring other marketing programs that will
     provide further benefits to our customers and position us as the
     broadband infrastructure provider of choice.


                                      S-15
<PAGE>

     Moreover, because our centralized Global Crossing network center,
     located in The Docklands, London, England, enables us to monitor and
     direct transmission on our cable systems worldwide, we believe that we
     have a strategic advantage in being able to more quickly activate
     capacity for a customer on any of our systems.

  .  Switched Services: We provide originating and switched terminating
     services to long distance carriers over our switched services network.
     These services are generally offered on a month-to-month basis, and the
     service is billed on a minutes-of-use basis.

  .  Internet Protocol Services: We offer IP services to carriers, Internet
     service providers, or "ISPs", and other business customers over our
     global IP network. We offer these services on a month-to-month basis,
     and we generally bill them on an Mbps basis.

 Installation and maintenance services

   We offer both installation and maintenance services for undersea cable
systems through our Global Marine Systems subsidiary. Global Marine Systems
has the largest fleet of cable ships in the world, comprised of both
maintenance vessels and installation vessels. These vessels operate throughout
the world. Since the acquisition, Global Marine Systems added three ships,
with five additional ships to enter service early in 2000. Global Marine
Systems also announced an agreement with Maersk to charter ships as needed.

   Global Marine Systems' business consists of two components: installation
and maintenance.

  .  Maintenance: Global Marine Systems is the world's market leader for
     submarine cable maintenance with 31% of the world market by value in
     1999.

     Global Marine Systems' maintenance business is centered around cable
     system security. Despite optimum route planning and installation, cables
     are sometimes damaged on the seabed. The maintenance cable ship must be
     able to retrieve a partially buried cable down to 2,000 meters as well
     as retrieve and repair a cable from the furthest ocean depths. With
     cable in water depths of up to 9,000 meters, the cable ship is a
     specialized vessel designed to operate continuously in the extreme
     weather conditions found in the major cable routes around the world.

  .  Installation:  Global Marine Systems' installation business has a market
     share in excess of 25%, making it a leading competitor in the undersea
     telecommunications installation industry.

     Revenue from installation is linked to the number of submarine
     telecommunication cable systems annually installed worldwide. Those
     systems traverse many types of seabed, including active continental
     shelves, flat deep-water abyssal plains and mountainous oceanic ridges.
     The objective when installing cable is to deploy it in such a way as to
     minimize the risk of damage to the cable either from external threats or
     from natural wear effects caused by ocean currents and tides. The cable
     can either be buried into the seabed if protection is required from
     threats such as fishing and anchoring or it can simply be laid across
     the surface of the seabed.

 ILEC services

   Our ILEC services segment comprises one of the largest local exchange
service providers in the United States. This segment consists of 34 regulated
telephone operating subsidiaries in 13 states, serving in excess of one
million access lines. Those services are marketed under the name Frontier
Telephone, a Frontier Communications Company. The local exchange carriers
provide local, toll, access and resale services, sell, install and maintain
customer premises equipment and provide directory services. Our ILEC services
segment excludes local services provided by our subsidiaries authorized as
competitive local exchange carriers, or "CLECs", which services are included
in our telecommunications services segment. Generally speaking, ILECs tend to
be the original provider of local exchange service in a given area and,
accordingly, receive a greater degree of regulation than do CLECs and other
carriers without market power.

                                     S-16
<PAGE>

   We have installed advanced digital switching platforms throughout all of our
switching network, making it one of the first in the industry to be served by
an entirely digital network for our local exchange companies. We have achieved
substantial cost reductions through the elimination of duplicative services and
procedures and the consolidation of administrative functions. We believe that
additional cost reductions may be obtainable from advanced switching platforms
and outside plant delivery systems. We intend to pursue additional gains in
productivity by investing in these technologies where feasible and by
reengineering customer service processes.

   Of the approximately 1,072,000 access lines in service on December 31, 1999,
737,000 were residential lines and 335,000 were business lines. Long distance
network service to and from points outside of the telephone companies'
operating territories is provided by interconnection with the facilities of
interexchange carriers.

   We are pursuing several alternatives to provide expanded broadband
capabilities to our customers. To date, we have installed over 31,000 fiber
miles of fiber based network facilities, totaling more than 930 route miles, in
the Rochester, New York area to provide our customers with enhanced capacity
and to enable us to offer new products. We provide expanded broadband services
to select customers, including video-distance learning arrangements for
educational institutions and access to SONET based fiber rings for major
business customers. In addition to these offerings, we plan to aggressively
begin marketing Digital Subscriber Line, or "DSL", services in 2000.

   In connection with our integration strategy, we have developed a program
known as "Frontier Long Distance", whereby our local exchange companies resell
our integrated services. We believe that many customers prefer the convenience
of obtaining their long distance service through their local telephone company
and receiving a single bill. Frontier Long Distance is currently offered in the
product lines of most of our local telephone exchange companies.

The Global Crossing Network

   The fiber optic cable systems that we have completed or that are under
development will form a state-of-the-art interconnected worldwide high capacity
fiber optic network. The following systems are currently in service:

  .  Atlantic Crossing-1, which we refer to as "AC-1", an undersea system
     connecting the United States and Europe;

  .  North American Crossing, which we refer to as "NAC", formerly part of
     Frontier, a terrestrial system connecting major cities in the United
     States;

  .  Pan European Crossing, which we refer to as "PEC", a primarily
     terrestrial system connecting major European cities to AC-1;

  .  Racal Telecom Network, a terrestrial network in the United Kingdom to be
     operated in conjunction with PEC;

  .  Pacific Crossing, which we refer to as "PC-1", an undersea system
     connecting the United States and Japan;

  .  Global Access Ltd., which we refer to as "GAL", a terrestrial system
     connecting a number of major cities in Japan to PC-1;

  .  Hutchison Global Crossing, which we refer to as "HGC", a terrestrial
     network in Hong Kong, connecting to East Asia Crossing; and

  .  Mid-Atlantic Crossing, which we refer to as "MAC", an undersea system
     connecting the eastern United States and the Caribbean.

                                      S-17
<PAGE>

   The following systems are in varying stages of development:

  .  Atlantic Crossing-2, which we refer to as "AC-2", an undersea system
     that will connect the United States and Europe;

  .  East Asia Crossing, which we refer to as "EAC", an undersea system that
     will connect several countries in Asia to PC-1;

  .  Pan American Crossing, which we refer to as "PAC", a primarily undersea
     system that will connect the western United States, Mexico, Panama,
     Venezuela and the Caribbean; and

  .  South American Crossing, which we refer to as "SAC", an undersea and
     terrestrial system that will connect the major cities of South America
     to MAC, PAC and the rest of our network.

   Although many of these fiber optic cable systems are wholly-owned, some are
being developed through joint ventures with one or more partners. EAC and our
58% economic interest in PC-1 are being developed through our Asia Global
Crossing joint venture, for which we are responsible for management and
operation. In addition, we expect to construct parts of the terrestrial
portion of SAC through joint venture arrangements, and terrestrial
connectivity to PAC in Mexico will similarly be developed through a joint
venture. We will be responsible for management and operation of these
entities. Finally, we own a 50% interest in Hutchison Global Crossing and a
49% interest in Global Access Ltd., which is constructing GAL. Management and
operation of these two entities will be performed by or with our joint venture
partners.

   All of our undersea systems are equipped with state-of-the-art dense wave
division multiplexing, or "DWDM", technology, a method of increasing the
amount of a cable's transmission capacity through installation of electronic
equipment at cable landing stations and without requiring the undersea cable
to be physically handled.

   The twin operations and management centers for the Global Crossing network
are the customer care center, located in Bermuda, and the Global Crossing
network center, located in The Docklands, London, England. These two
facilities provide complete customer support, from provisioning and assistance
to billing. From the Global Crossing network center, our technicians and
network managers monitor and control all undersea cable systems, shore station
equipment and terrestrial facilities worldwide. The Global Crossing network
center began operations in the fourth quarter of 1999.

Network Systems

 Atlantic Crossing

   AC-1, our first undersea fiber optic cable in the Atlantic region, is an
approximately 9,000 mile, four fiber pair self-healing ring that connects the
United States and Europe with landing stations in the United States, the
United Kingdom, the Netherlands and Germany. The full ring currently offers 80
Gbps of service capacity and is being upgraded to offer 140 Gbps. AC-1 started
service on its United States to United Kingdom segment during May 1998, and
the full system was completed during February 1999.

   On February 17, 2000, we announced that we had entered into an agreement
with Level 3 Communications, Inc. to co-build an additional high-capacity,
fiber optic transatlantic cable. Our two fiber pairs in the cable, to be
called AC-2, will provide us with an additional 560 Gbps of capacity along
this route. AC-2 will be integrated with the two cables of AC-1, providing AC-
2 with self-healing capabilities. The new cable is expected to be in service
in September 2000. In addition, Level 3 Communications, Inc. agreed to acquire
capacity on AC-1 to provide Level 3 Communications, Inc. with self-healing
ring circuitry.

 North American Crossing

   We acquired NAC, formerly the Frontier Optronics Network, as a result of
our September 1999 merger with Frontier Corporation. The core fiber network,
offering more than 13,000 route miles of optical fiber capacity, was completed
in August 1999. The full network, consisting of approximately 20,000 route
miles, is expected to be completed by the end of March 2000.

                                     S-18
<PAGE>

 Pan European Crossing

   Upon completion, PEC will consist of eight self-healing rings offering
connectivity between AC and 41 major European metropolitan centers. Phase I of
this system, connecting 13 cities, was completed in December 1999. The complete
system, expected to consist of approximately 13,400 miles with 24 to 72 fiber
pairs as well as spare conduits, is anticipated to be completed by early 2001.

   We intend to operate the Racal Telecom Network in conjunction with PEC.
Acquired in November 1999, the Racal Telecom Network is one of the most
extensive fiber telecommunications networks in the United Kingdom, consisting
of approximately 4,500 route miles of fiber and reaching more than 2,000 cities
and towns.

 Pacific Crossing

   PC-1, our first undersea fiber optic cable in the Pacific region, is being
developed as an approximately 13,100 mile, four fiber pair self-healing ring
connecting California and Washington in the western United States with two
landing sites in Japan. The PC-1 self-healing ring is designed to operate
initially at 80 Gbps of service capacity, upgradable to a minimum of 160 Gbps.
The first segment of PC-1 commenced service in December 1999 and the full
system is anticipated to be completed in July 2000.

 Global Access Ltd.

   GAL is an approximately 1,000 mile fiber optic terrestrial system in Japan
that, among other things, will connect the PC-1 cable stations with Tokyo,
Osaka and Nagoya, Japan. The first phase of GAL's development was completed in
December 1999, with the full system anticipated to be completed by the third
quarter of 2000.

 Hutchison Global Crossing

   Hutchison Global Crossing owns and operates a building-to-building fixed-
line telecommunications network in Hong Kong and a number of Internet-related
assets. The fiber optic network as of December 1999 extended over 400 miles and
is expected to be expanded during 2000. In addition, any fixed-line
telecommunications activities that Hutchison Whampoa pursues in China will be
carried out by the joint venture.

 Mid-Atlantic Crossing

   MAC is an approximately 4,700 mile two fiber pair self-healing ring
connecting New York, the Caribbean and Florida. MAC connects to AC via its
cable station in Brookhaven, New York, to NAC via its cable stations in
Brookhaven and in Hollywood, Florida and to SAC and PAC via its cable station
in St. Croix, United States Virgin Islands. This system is being designed to
operate initially at 20 Gbps of service capacity, upgradable to a minimum of 40
Gbps. MAC commenced service in January 2000, with the full system anticipated
to be completed during 2000.

 East Asia Crossing

   EAC will be an approximately 11,000 mile terrestrial and undersea cable
system, Phase I of which will link Japan, Taiwan, South Korea and Hong Kong,
and Phase II of which is expected to further link Singapore, Malaysia and the
Philippines. EAC is being designated to operate initially at 80 Gbps of service
capacity, upgradable to a minimum of 1,200 Gbps. The first segment of EAC's
development, linking Japan and Hong Kong, is expected to be completed by
December 2000, with the full Phase I system anticipated to be completed by June
2001.

 Pan American Crossing

   PAC will be an approximately 6,000 mile two fiber pair cable system
connecting California, Mexico, Panama, Venezuela and the Caribbean. PAC will
interconnect with PC- 1 and NAC through our landing station

                                      S-19
<PAGE>

in Grover Beach, California, with MAC through our landing station in St. Croix,
United States Virgin Islands and with SAC through our landing station in Fort
Amador, Panama. PAC is being designed to operate initially at 20 Gbps of
service capacity, upgradable to a minimum of 40 Gbps. PAC is anticipated to
commence service during 2000.

   In connection with PAC, we own a 49% interest in Global Crossing Landing
Mexicana, S. de R.L. de C.V., a joint venture company jointly owned with an
affiliate of Bestel, S.A. de C.V., that will provide approximately 2,200 miles
of terrestrial connectivity in Mexico and connect to the PAC system.

 South American Crossing

   SAC will be an approximately 9,900 mile undersea and 1,500 mile terrestrial
fiber optic network directly linking the major cities of South America through
MAC and PAC to the United States, Mexico, Central America, the Caribbean, Asia
and Europe. We plan to build SAC in three phases. The first two phases,
providing Argentina and Brazil with connectivity to the Global Crossing
Network, are scheduled to commence service in the fourth quarter of 2000. The
final phase, completing the loop around the continent, is scheduled for
completion in the first quarter of 2001. Initially, SAC is expected to have a
capacity of 40 Gbps and to be upgradable to a minimum of 80 Gbps.

   The undersea portion of SAC will constitute a state-of-the-art four-fiber
pair, self-healing ring, expected to connect to landing sites at St. Croix;
Fortaleza, Rio de Janeiro and Santos, Brazil; Las Toninas, Argentina;
Valparaiso, Chile; Lurin, Peru; Buenaventura, Colombia; and Fort Amador,
Panama. Terrestrial segments are expected to connect to most major South
American cities, including Rio de Janeiro, Sao Paulo, Buenos Aires, Santiago,
Lima, Cali and Bogota. The SAC ring is expected to be completed on its
southern-most end by a terrestrial link across the Andes between Las Toninas
and Valparaiso. The PAC system from Panama to St. Croix is expected to complete
the ring.

Additional Business Opportunities

   In addition to the core components of the Global Crossing network, we also
intend from time to time to make strategic investments and other contractual
arrangements to better enable us to expand our offerings of products and
services. Some of these opportunities include:

   NextWave. We have agreed to make an equity investment in NextWave Telecom
Inc. as part of NextWave's plan of bankruptcy reorganization, subject to
certain conditions relating to NextWave's retaining communications licenses
from the Federal Communications Commission. In addition, we have entered into a
strategic services agreement with NextWave making us the preferred provider of
backhaul, long distance backbone, web-hosting and other communications services
to NextWave. NextWave plans to deploy a wireless telecommunications network
specifically designed to provide next generation wireless services, including
Internet access.

   Telergy. We have entered into an agreement with Telergy, Inc., under which
we have acquired 96 strands of fiber throughout the New York area on Telergy's
100-mile New York City network. In addition, the agreement provides us with an
ownership position in Telergy and representation on its board of directors. We
and Telergy have also agreed to explore co-build opportunities in the
northeastern United States and to seek to utilize the Telergy network as needed
for redundancy and termination of Global Crossing traffic in certain areas.

   Africa ONE. We have been selected to provide marine operations and to act as
project manager of Africa ONE, an estimated $1.6 billion cable system
consisting of a self-healing ring around the continent of Africa. We do not
intend to make an equity investment in this system.

Principal Customers

   Although we have greatly expanded the number of products and services that
we offer to our customers, our principal customers to date have been licensed
telecommunications providers, including post, telephone and

                                      S-20
<PAGE>

telegraph companies, Internet service providers and established and emerging
telecommunications companies, that have purchased significant amounts of
capacity on our systems worldwide. Significant customers in our
telecommunications services segment include Deutsche Telekom, MCI Worldcom,
Level 3 Communications, KPN Qwest, Teleglobe, Telia, British Telecom, Viatel
and AT&T. In addition, the largest of our web hosting customers include Yahoo!,
The Motley Fool, Ziff-Davis, MP3.com and eToys.

Principal Suppliers

   Our principal suppliers are the companies that are constructing the various
cable systems that comprise the Global Crossing Network. Tyco Submarine Systems
Ltd., which we refer to as "TSSL", completed construction of AC-1; is
responsible for the design and installation of PAC; together with Alcatel, is
responsible for design and installation of MAC; and, together with Kokusai
Denshin Denwa-Submarine Cable Systems, which we refer to as "KDD-SCS", as a
subcontractor, is responsible for design and installation of PC-1. Alcatel is
responsible for the design and construction of SAC, while KDD-SCS is
responsible for the design and construction of the first phase of EAC. We
utilize multiple suppliers for terrestrial systems.

Competition

 Telecommunications services

   The telecommunications industry is highly competitive. Many of our existing
and potential competitors, particularly in our telecommunications services
markets, compete with significantly greater financial, personnel, marketing and
other resources and have other competitive advantages.

   The telecommunications industry is in a period of rapid technological
evolution, marked by increasing fiber and satellite transmission capacity, new
technologies and the introduction of new products and services. For instance,
recent technological advances enable substantial increases in transmission
capacity of both new and existing fiber, which could affect capacity supply and
demand. Also, the introduction of new products or emergence of new technologies
may reduce the cost or increase the supply of certain services similar to those
we provide.

   High initial network cost and low marginal costs of carrying long distance
traffic have led to a trend among non-facilities-based carriers to consolidate
in order to achieve economies of scale. This consolidation could result in
larger, better-capitalized competitors. However, we believe that owning our own
network will offer an advantage over carriers that lease network capacity.

   Increased consolidation and strategic alliances in the industry resulting
from the Telecommunications Act of 1996 have allowed significant new
competitors to enter the industry, including local exchange carriers,
previously prohibited from the inter-state market.

   In recent years, competition has increased dramatically in all areas of our
communications services market. Our primary competitors include Qwest, AT&T,
Sprint and MCI WorldCom and foreign PTTs, all of whom have extensive experience
in the long distance market. The impact of continuing consolidation in the
industry is uncertain. In addition, pursuant to the Telecommunications Act,
local exchange carriers, including Bell Atlantic, have begun to enter the long
distance market in their home service areas.

   As we expand our business into Internet protocol services, we are also
competing with a wide range of companies that provide web hosting, Internet
access and other Internet protocol products and services. Significant
competitors include IBM, GTE, UUNet which is a subsidiary of MCI WorldCom,
Digex and Exodus. In addition, many smaller companies have entered the market
for web-based services.

   The routes addressed by our systems are currently served by several cable
systems as well as satellites. Primary future sources of transatlantic
competition for us may result from, among others, (1) TAT-14, a transatlantic
cable system which is being developed by its consortium members, including
British Telecom,

                                      S-21
<PAGE>

AT&T, France Telecom and Deutsche Telekom, (2) Flag Atlantic-1, a
transatlantic system which is being developed by Flag Telecom and Global
Telesystems Group Inc., (3) a transatlantic cable system being developed by
Level 3 (the other half of the cable we are co-building as AC-2); and (4)
Hibernia, a transatlantic cable system being developed by 360networks.

 Similarly, we expect to face competition in the transpacific market from,
among others, (1) the China-U.S. Cable Network, a transpacific system being
developed as a "private cable system" by fourteen large carriers, including
SBC Communications Inc., MCI WorldCom Inc., AT&T and Sprint, most of which
have traditionally sponsored consortium cables and (2) the Japan-U.S. Cable
Network, a transpacific system being developed by a consortium of major
telecommunications carriers, including MCI WorldCom Inc., AT&T, Kokusai
Denshin Denwa Co. Ltd., Nippon Telegraph and Telephone Corp., Cable & Wireless
and GTE.

 In addition, we will face competition on PEC, our trans-European network.
There are several carriers, including Viatel, KPN-Qwest, MCI WorldCom, Inc., a
joint venture between Deutsche Telekom and France Telecom, British Telecom,
Global Telesystems Group and a joint venture between Level 3 and COLT Telecom
Group plc, which are currently planning or building trans-European network
assets.

 We also face competition for our SAC network in South America. At least six
other systems are planned to be completed in the region by the third quarter
of 2001, including two consortium cables, Americas-2 and Atlantis-2;
Atlantica-1, a ring network being constructed by GlobeNet connecting
Venezuela, Brazil, and, through terrestrial cables, Argentina to North
America; and SAm-1, a ring system being constructed by Telefonica S.A. and
TSSL connecting Brazil, Argentina, Chile, Peru and Colombia to the United
States. In addition, we may face competition from existing and planned
regional systems and satellites on our MAC and PAC routes, where entrants are
vying for purchases from a small but rapidly growing customer base.

 In addition to the systems mentioned above, several other regional and global
systems are being developed, most notably by TSSL, which has recently
announced its plans to build a worldwide cable network, and Project Oxygen, a
global system being evaluated by the CTR Group, Ltd.

 In the United States, there are several facilities-based long distance fiber
optic networks competing with our NAC cable system, including those of AT&T,
Sprint, MCI WorldCom, Qwest, GTE, Broadwing Communications, Level 3
Communications and Williams Communications.

Installation and maintenance services

 Although Global Marine Systems is the world's largest undersea cable
installation and maintenance company, with approximately 25% of the industry's
total vessels, it faces potential competition not only from existing market
participants but also from potential new entrants. There are currently three
other major supply companies in the undersea cable industry: TSSL, Alcatel and
KDD-SCS. Pirelli also has a presence in the industry, and there are a number
of smaller suppliers which have focused primarily on regional routes or non-
repeatered systems. It is unclear whether TSSL will continue to provide
significant installation and maintenance services to others following its
announcement that it is constructing its own worldwide cable network.

ILEC services

 We face many competitors in the provision of equipment and facilities used in
connection with our local exchange networks, as this market has become
increasingly competitive in recent years. The market for the provision of
local services itself is now competitive in Rochester, New York, as a result
of the Open Market Plan, and the Telecommunications Act is likely to result in
significantly greater competition in other markets. Our telephone properties
outside the Rochester, New York, area are experiencing competition in limited
areas.

 Long distance companies largely access their end user customers through
interconnection with local exchange companies. These long distance companies
pay access fees to the local exchange companies for these services. The
provision of access services in Rochester and elsewhere by our ILEC services
segment is considered to be competitive.

                                     S-22
<PAGE>

                         DESCRIPTION OF PREFERRED STOCK

   The following section describes all the material terms of the preferred
stock, but does not purport to be complete and is subject to and qualified in
its entirety by reference to the certificate of designations relating to the
preferred stock. We have filed the certificate of designations as an exhibit to
the registration statement of which this prospectus supplement is a part. You
may also obtain a copy of the certificate of designations by contacting us at
the address provided under "Where You Can Find More Information" on page ii.

General

   At the consummation of this offering, we will issue 3,000,000 shares, or up
to 3,450,000 shares if the underwriters exercise their over-allotment option,
of  % cumulative convertible preferred stock, $0.01 par value per share and
$250.00 liquidation preference per share. When issued, the shares of preferred
stock will be validly issued, fully paid and nonassessable.

   The holders of the shares of preferred stock will have no preemptive or
preferential rights to purchase or subscribe to stock, obligations, warrants or
any other of our securities.

Ranking

   The preferred stock will rank, with respect to dividend rights and upon
liquidation, winding up and dissolution:

     .  junior to all our existing and future debt obligations;

     .  junior to "senior stock", which is each other class or series of
        our capital stock other than (a) our common stock and any other
        class or series of our capital stock the terms of which provide
        that that class or series will rank junior to the preferred stock
        and (b) any other class or series of our capital stock the terms
        of which provide that that class or series will rank on a parity
        with the preferred stock;

     .  on a parity with "parity stock", which is our 6 3/8% cumulative
        convertible preferred stock, our 6 3/8% cumulative convertible
        preferred stock, series B, our 7% cumulative convertible preferred
        stock and each other class or series of our capital stock that has
        terms which provide that that class or series will rank on a
        parity with the preferred stock;

     .  senior to "junior stock", which is our common stock and each class
        or series of our capital stock that has terms which provide that
        that class or series will rank junior to the preferred stock.

   The terms "senior stock", "parity stock" and "junior stock" include
warrants, rights, calls or options exercisable for or convertible into that
type of stock.

Dividends

   The holders of the shares of preferred stock are entitled to receive, when,
as and if declared by our board of directors out of funds legally available for
payment, cumulative dividends per share at the annual rate of   % of the
$250.00 liquidation preference per share of preferred stock. The dividend rate
is equivalent to $    per share annually. The right of the holders of the
shares of preferred stock to receive dividend payments is subject to the rights
of any holders of shares of senior stock and parity stock.

   Dividends are payable in equal amounts on     ,     ,      and      of each
year, beginning on     , 2000. If any of those dates is not a business day,
then dividends will be payable on the next succeeding business day. Dividends
will accrue from the most recent date as to which dividends will have

                                      S-23
<PAGE>

been paid or, if no dividends have been paid, from the date of the original
issuance of the shares of preferred stock. The first dividend period will begin
on     , 2000. Dividends will be payable to holders of record as they appear in
our stock records at the close of business on     ,     ,      and      of each
year or on a record date which will be fixed by our board of directors and
which will be not more than 60 days and not less than 10 days before the
applicable quarterly dividend payment date. Dividends will be cumulative from
each quarterly dividend payment date, whether or not we will have funds legally
available for the payment of those dividends. Accumulations of dividends on
shares of preferred stock will not bear interest. Dividends payable on the
shares of preferred stock for any period shorter than a full quarterly period
will be computed on the basis of a 360-day year consisting of twelve 30-day
months.

   Dividends on the shares of preferred stock will be payable in cash. We will
have the option to pay all or any part of a dividend by delivering shares of
our common stock to the transfer agent. In this case, we must deliver to the
transfer agent a number of shares of our common stock which, when resold by the
transfer agent, will result in net cash proceeds sufficient to pay the
applicable dividend in cash to the holders of the shares of preferred stock.
The holders of shares of preferred stock will not receive any shares of our
common stock as dividend. If the proceeds of any resale of shares of our common
stock do not result in sufficient cash proceeds to pay a dividend, we will
promptly provide cash to the transfer agent in an amount equal to the
difference between the amount of the dividend and the proceeds of that resale.
All shares of common stock that we may deliver to the transfer agent as
provided in this paragraph for the payment of dividends will be registered
under the Securities Act.

   We will not (1) declare or pay any dividend on or (2) set apart any sum for
the payment of dividends on any outstanding shares of preferred stock with
respect to any dividend period unless we have declared and paid or have
declared and set apart a sufficient sum for the payment of all dividends on all
outstanding shares of this issue of preferred stock for all preceding dividend
periods.

   We will not (1) declare, pay or set apart funds for the payment of any
dividend or other distribution with respect to any junior stock or parity stock
or (2) redeem, purchase or otherwise acquire for consideration junior stock or
parity stock through a sinking fund or otherwise, unless we have paid or set
apart funds for the payment of all accrued and unpaid dividends with respect to
the shares of this issue of preferred stock and any parity stock at the time
those dividends are payable. As an exception to clause (1) of this paragraph,
we will be able to (a) declare and pay dividends on junior stock or parity
stock which are payable solely in shares of parity stock or junior stock, in
the case of parity stock, or junior stock, in the case of junior stock, or by
the increase in the liquidation value of junior stock or parity stock and (b)
redeem, purchase or otherwise acquire junior stock or parity stock in exchange
for consideration consisting of parity stock or junior stock, in the case of
parity stock, or junior stock, in the case of junior stock.

Redemption

 Optional Redemption

   Except as provided below under "--Tax Redemption", we may not redeem any
shares of preferred stock before     , 2005. After that date, we will have the
option to redeem for cash any or all shares of preferred stock, at any time or
from time to time, upon not less than 30 nor more than 60 days' prior notice
sent by first class mail to each holder's registered address, at the following
redemption prices, expressed as a percentage of the liquidation preference per
share, plus accumulated and unpaid dividends to the date of redemption,
beginning on       of each of the following years:

<TABLE>
<CAPTION>
                                                                      Redemption
       Period                                                           Price
       ------                                                         ----------
       <S>                                                            <C>
       2005..........................................................         %
       2006..........................................................         %
       2007..........................................................         %
       2008..........................................................         %
       2009..........................................................         %
       2010 and thereafter...........................................  100.000%
</TABLE>


                                      S-24
<PAGE>

 Tax Redemption

   For purposes of this section, "additional amounts" means amounts that we
must pay to the holders of the shares of preferred stock as additional
dividends, to make up for any deduction or withholding for any present or
future taxes, assessments or other governmental charges imposed by any
jurisdiction, political subdivision or taxing authority described in the second
sentence of the fourth paragraph of this section in respect of any amounts that
we or a successor corporation must pay with respect to the shares of preferred
stock, so that the net amounts paid to the holders of the shares of preferred
stock, after that deduction or withholding, will be not less than the amount
specified in those shares. However, we will not be obligated to pay additional
amounts to any holder that:

     .  resides in or is a citizen of the jurisdiction, political
        subdivision or taxing authority imposing the taxes, assessments or
        other governmental charges that would otherwise trigger our
        obligation to pay additional amounts; or

     .  is a fiduciary, partnership or limited liability company if, and
        to the extent that, the payment of additional amounts would be
        required by a jurisdiction, political subdivision or taxing
        authority described in the second sentence of the fourth paragraph
        of this section to be included in the income for tax purposes of a
        beneficiary or settlor with respect to that fiduciary or a member
        of that partnership or limited liability company who would not
        have been entitled to any additional amounts had that beneficiary,
        settlor or member held those shares of preferred stock directly.

   In addition, we will not be obligated to pay any additional amounts to a
holder on account of:

     .  any tax, assessment or other governmental charge that would not
        have been imposed but for (a) the existence of any present or
        former connection between the holder, or certain other persons,
        and the taxing jurisdiction or political subdivision, (b) the
        presentation of shares of preferred stock for payment after a
        specified time period or (c) the presentation of shares of
        preferred stock for payment in Bermuda or any political
        subdivision of or in Bermuda, unless those shares could not have
        been presented for payment elsewhere;

     .  any estate, inheritance, gift, sales, transfer, personal property
        or similar tax, assessment or other governmental charge;

     .  any tax, assessment or other governmental charge that is payable
        otherwise than by withholding from payment of the liquidation
        preference of or any dividends on the shares of preferred stock;

     .  any tax, assessment or other governmental charge that is imposed
        or withheld by reason of the failure by the holder or the
        beneficial owner of the shares of preferred stock to comply with a
        request by us to (a) provide information, documents or other
        evidence concerning the nationality, residence or identity of the
        holder or beneficial owner or (b) make and deliver any declaration
        or other similar claim, other than a claim for refund of a tax,
        assessment or other governmental charge withheld by us, or satisfy
        any information or reporting requirements, which, in the case of
        clauses (a) or (b), is required or imposed by a statute, treaty,
        regulation or administrative practice of the taxing jurisdiction
        as a precondition to exemption from all or part of that tax,
        assesment or other governmental charge; or

     .  any combination of the items identified by bullet points above.

   We will have the option to redeem for cash any or all shares of preferred
stock at any time or from time to time, upon not less than 30 nor more than 60
days' prior notice sent by first-class mail to each holder's registered
address, at 100% of the liquidation preference per share plus accumulated and
unpaid dividends to the date of redemption, if there is a "change in tax law"
that would require us or any successor corporation to

                                      S-25
<PAGE>

pay additional amounts with respect to the shares of preferred stock on the
next succeeding dividend payment date, and the payment of those additional
amounts cannot be avoided by the use of any reasonable measures available to us
or any successor corporation.

   A "change in tax law" that would trigger the provisions of the preceding
paragraph would be (a) a change in or amendment to laws, regulations or rulings
of any jurisdiction, political subdivision or taxing authority described in the
next sentence, (b) a change in the official application or interpretation of
those laws, regulations or rulings or (c) any execution of or amendment to any
treaty affecting taxation to which any jurisdiction, political subdivision or
taxing authority described in the next sentence is party. The jurisdictions,
political subdivisions and taxing authorities referred to in the previous
sentence are (a) Bermuda or any political subdivision or governmental authority
of or in Bermuda with the power to tax, (b) any jurisdiction, other than the
United States, from or through which we or our paying agent is making payments
on the shares of preferred stock or any political subdivision or governmental
authority of or in that jurisdiction with the power to tax or (c) any other
jurisdiction, other than the United States, in which we or a successor
corporation is organized or any political subdivision or governmental authority
of or in that jurisdiction with the power to tax.

   In addition, we will have the option to redeem for cash any or all shares of
preferred stock at any time or from time to time, upon not less than 30 nor
more than 60 days' prior notice sent by first-class mail to each holder's
registered address, at 100% of the liquidation preference per share plus
accumulated and unpaid dividends to the date of redemption, if the entity
formed by a consolidation, merger or amalgamation involving Global Crossing or
the entity to which we convey, transfer or lease substantially all our
properties and assets is required to pay additional amounts in respect of any
tax, assessment or governmental charge imposed on any holder of shares of
preferred stock as a result of a change in tax law that occurred after the date
of the consolidation, merger, amalgamation, conveyance, transfer or lease.

 Provisions Relating to the Optional and Tax Redemption

   In the case of any partial redemption, we will select the shares of
preferred stock to be redeemed on a pro rata basis, by lot or any other method
that we, in our discretion, deem fair and appropriate. However, we may redeem
all the shares held by holders of fewer than 100 shares or who would hold fewer
than 100 shares as a result of the redemption.

   If the redemption date falls after a dividend payment record date and before
the related dividend payment date, the holders of the shares of preferred stock
at the close of business on that dividend payment record date will be entitled
to receive the dividend payable on those shares on the corresponding dividend
payment date, even if those shares are redeemed after that dividend payment
record date.

 Mandatory Redemption

   On     , 2012, we will be obligated to redeem all outstanding shares of
preferred stock for cash, upon not less than 30 nor more than 60 days' prior
notice sent by first class mail to each holder's registered address, at 100% of
the liquidation preference per share, plus accumulated and unpaid dividends to
the date of redemption.

Liquidation Preference

   Upon any voluntary or involuntary liquidation, dissolution or winding up of
Global Crossing or a reduction or decrease in our capital stock resulting in a
distribution of assets to the holders of any class or series of our capital
stock, each holder of shares of preferred stock will be entitled to payment out
of our assets available for distribution of an amount equal to the then
effective liquidation preference per share of preferred stock held by that
holder, plus all accumulated and unpaid dividends on those shares to the date
of that liquidation, dissolution, winding up or reduction or decrease in
capital stock, before any distribution is made on

                                      S-26
<PAGE>

any junior stock, including our common stock, but after any distributions on
any of our indebtedness or shares of our senior stock. After payment in full of
the liquidation preference and all accumulated and unpaid dividends to which
holders of shares of preferred stock are entitled, the holders will not be
entitled to any further participation in any distribution of our assets. If,
upon any voluntary or involuntary liquidation, dissolution or winding up of
Global Crossing or a reduction or decrease in our capital stock, the amounts
payable with respect to shares of preferred stock and all other parity stock
are not paid in full, the holders of shares of preferred stock and the holders
of the parity stock will share equally and ratably in any distribution of our
assets in proportion to the full liquidation preference and all accumulated and
unpaid dividends to which each such holder is entitled.

   Neither the voluntary sale, conveyance, exchange or transfer, for cash,
shares of stock, securities or other consideration, of all or substantially all
of our property or assets nor the consolidation, merger or amalgamation of
Global Crossing with or into any corporation or the consolidation, merger or
amalgamation of any corporation with or into Global Crossing will be deemed to
be a voluntary or involuntary liquidation, dissolution or winding up of Global
Crossing or a reduction or decrease in our capital stock.

   We are not required to set aside any funds to protect the liquidation
preference of the shares of preferred stock, although the liquidation
preference will be substantially in excess of the par value of the shares of
the preferred stock.

Voting Rights

   Except as required under Bermuda law or as provided in the certificate of
designations, the holders of the shares of preferred stock will not be entitled
to vote on any matter as our shareholders, except as follows:

    (1) The affirmative vote of the holders of at least a majority of the
 outstanding shares of preferred stock, voting with holders of shares of all
 other series of preferred stock affected in the same way as a single class,
 in person or by proxy, at a special or annual meeting called for that
 purpose, or by written consent in lieu of meeting, will be required to amend,
 repeal or change any provisions of the certificate of designations in any
 manner which would adversely affect, alter or change the powers, preferences
 or special rights of the preferred stock and any of those securities affected
 in the same way. With respect to any matter on which the holders are entitled
 to vote as a separate class, each share of preferred stock will be entitled
 to one vote.

    (2) If at any time the equivalent of six quarterly dividends payable on
 the shares of preferred stock are accrued and unpaid, whether or not
 consecutive and whether or not declared, the holders of all outstanding
 shares of preferred stock and any parity stock or senior stock having similar
 voting rights then exercisable, voting separately as a single class without
 regard to series, will be entitled to elect at the next annual meeting of our
 shareholders two directors to serve until all dividends accumulated and
 unpaid on any of those voting shares have been paid or declared and funds set
 aside to provide for payment in full. In exercising the voting rights
 described in this paragraph, each outstanding share of preferred stock will
 be entitled to one vote.

   The creation, authorization or issuance of any other class or series of our
capital stock or the increase or decrease in the amount of authorized capital
stock of any of those classes or series or of the preferred stock, or any
increase, decrease or change in the par value of any class or series of capital
stock, including the preferred stock, will not require the consent of the
holders of the preferred stock and will not be deemed to affect adversely,
alter or change the powers, preferences and special rights of the shares of
preferred stock.

Conversion Rights

   Each share of preferred stock will be convertible at any time and from time
to time, at the option of the holder, into fully paid and nonassessable shares
of our common stock. The number of shares of common stock deliverable upon
conversion of a share of preferred stock, adjusted as provided under "--
Adjustments to the Conversion Price" on page S-29, is referred to in this
document as the "conversion ratio". The conversion ratio will be       and will
equal the ratio the nominator of which will be the $250.00 liquidation
preference per share and the denominator of which will be the conversion price.
The initial conversion price will be $    , subject to adjustment from time to
time.

                                      S-27
<PAGE>

   A holder of shares of preferred stock may convert any or all of those shares
by surrendering to us at our principal office or at the office of the transfer
agent, as may be designated by our board of directors, the certificate or
certificates for those shares of preferred stock accompanied by a written
notice stating that the holder elects to convert all or a specified whole
number of those shares in accordance with the provisions of this section and
specifying the name or names in which the holder wishes the certificate or
certificates for shares of common stock to be issued. In case the notice
specifies a name or names other than that of the holder, the notice will be
accompanied by payment of all transfer taxes payable upon the issuance of
shares of common stock in that name or names. Other than those taxes, we will
pay any documentary, stamp or similar issue or transfer taxes that may be
payable in respect of any issuance or delivery of shares of common stock upon
conversion of shares of preferred stock. As promptly as practicable after the
surrender of that certificate or certificates and the receipt of the notice
relating to the conversion and payment of all required transfer taxes, if any,
or the demonstration to our satisfaction that those taxes have been paid, we
will deliver or cause to be delivered (a) certificates representing the number
of validly issued, fully paid and nonassessable full shares of our common stock
to which the holder, or the holder's transferee, of shares of preferred stock
being converted will be entitled and (b) if less than the full number of shares
of preferred stock evidenced by the surrendered certificate or certificates is
being converted, a new certificate or certificates, of like tenor, for the
number of shares evidenced by the surrendered certificate or certificates less
the number of shares being converted. This conversion will be deemed to have
been made at the close of business on the date of giving the notice and of
surrendering the certificate or certificates representing the shares of
preferred stock to be converted so that the rights of the holder thereof as to
the shares being converted will cease except for the right to receive shares of
common stock and accrued and unpaid dividends with respect to the shares of
preferred stock being converted, and the person entitled to receive the shares
of common stock will be treated for all purposes as having become the record
holder of those shares of common stock at that time.

   If a holder of shares of preferred stock exercises conversion rights, upon
delivery of the shares for conversion, those shares will cease to accrue
dividends as of the end of the day immediately preceding the date of
redemption, but those shares will continue to be entitled to receive all
accrued dividends which the holder is entitled to receive through the last
preceding dividend payment date. Any accrued and unpaid dividends will be
payable by us as and when those dividends are paid to any remaining holders or,
if none, on the date which would have been the next succeeding dividend payment
date had there been remaining holders or at a later time when we believe we
have adequate available capital under applicable law to make such a payment.
However, shares of preferred stock surrendered for conversion after the close
of business on any record date for the
payment of dividends declared and before the opening of business on the
dividend payment date relating to that record date must be accompanied by a
payment in cash of an amount equal to the dividend declared in respect of those
shares.

   In case any shares of preferred stock are to be redeemed, the right to
convert those shares of preferred stock will terminate at the close of business
on the business day immediately preceding the date fixed for redemption unless
we default in the payment of the redemption price of those shares.

   In connection with the conversion of any shares of preferred stock, no
fractions of shares of common stock will be issued, but we will pay a cash
adjustment in respect of any fractional interest in an amount equal to (a) the
fractional interest multiplied by the liquidation preference per share, divided
by (b) the conversion price. If more than one share of preferred stock will be
surrendered for conversion by the same holder at the same time, the number of
full shares of common stock issuable on conversion of those shares will be
computed on the basis of the total number of shares of preferred stock so
surrendered.

   We will at all times reserve and keep available, free from preemptive
rights, for issuance upon the conversion of shares of preferred stock a number
of our authorized but unissued shares of common stock that will from time to
time be sufficient to permit the conversion of all outstanding shares of
preferred stock if necessary to permit the conversion of all outstanding shares
of preferred stock. Before the delivery of any securities which we will be
obligated to deliver upon conversion of the preferred stock, we will comply
with all

                                      S-28
<PAGE>

applicable federal and state laws and regulations which require action to be
taken by us. All shares of common stock delivered upon conversion of the
preferred stock will upon delivery be duly and validly issued and fully paid
and nonassessable, free of all liens and charges and not subject to any
preemptive rights.

Adjustments to the Conversion Price

   The conversion price will be subject to adjustment from time to time as
follows:

    (1) Stock splits and combinations. In case we, at any time or from time to
 time after the issuance date of the shares of preferred stock (a) subdivide
 or split the outstanding shares of our common stock, (b) combine or
 reclassify the outstanding shares of our common stock into a smaller number
 of shares or (c) issue by reclassification of the shares of our common stock
 any shares of our capital stock, then the conversion price in effect
 immediately prior to that event or the record date for that event, whichever
 is earlier, will be adjusted so that the holder of any shares of preferred
 stock thereafter surrendered for conversion will be entitled to receive the
 number of shares of our common stock or of our other securities which the
 holder would have owned or have been entitled to receive after the occurrence
 of any of the events described above, had those shares of preferred stock
 been surrendered for conversion immediately before the occurrence of that
 event or the record date for that event, whichever is earlier.

    (2) Stock dividends in common stock. In case we, at any time or from time
 to time after the issuance date of the shares of preferred stock, pay a
 dividend or make a distribution in shares of our common stock on any class of
 our capital stock other than dividends or distributions of shares of common
 stock or other securities with respect to which adjustments are provided in
 paragraph (1) above, and the total number of shares constituting the dividend
 or distribution exceeds 25% of the total number of shares of common stock
 outstanding at the close of business on the record date fixed for
 determination of shareholders entitled to receive the dividend or
 distribution, the conversion price will be adjusted so that the holder of
 each share of preferred stock will be entitled to receive, upon conversion of
 that share, the number of shares of our common stock determined by
 multiplying (a) the conversion price by (b) a fraction, the numerator of
 which will be the number of shares of common stock outstanding and the
 denominator of which will be the sum of that number of shares and the total
 number of shares issued in that dividend or distribution. In case the total
 number of shares constituting that dividend or distribution does not exceed
 25% of the total number of shares of common stock outstanding at the close of
 business on the record date fixed for that dividend or distribution, the
 shares of common stock will be considered to be issued at the time of any
 such next succeeding dividend or other distribution in which the number of
 shares of common stock issued, together with the number of shares issued in
 all previous such dividends and distributions, will exceed such 25%.

    (3) Issuance of rights or warrants. For purposes of this paragraph and
 paragraph (4), "current market price" means the average of the daily closing
 prices for the five consecutive trading days selected by our board of
 directors beginning not more than 20 trading days before, and ending not
 later than the date of the applicable event described in this paragraph and
 the date immediately preceding the record date fixed in connection with that
 event. In case we issue to all holders of our common stock rights or warrants
 expiring within 45 days entitling those holders to subscribe for or purchase
 our common stock at a price per share less than the current market price, the
 conversion price in effect immediately before the close of business on the
 record date fixed for determination of shareholders entitled to receive those
 rights or warrants will be reduced by multiplying the conversion price by a
 fraction, the numerator of which is the sum of the number of shares of our
 common stock outstanding at the close of business on that record date and the
 number of shares of common stock that the aggregate offering price of the
 total number of shares of our common stock so offered for subscription or
 purchase would purchase at the current market price and the denominator of
 which is the sum of the number of shares of common stock outstanding at the
 close of business on that record date and the number of additional shares of
 our common stock so offered for subscription or purchase. For purposes of
 this paragraph (3), the issuance of rights or warrants to subscribe for or
 purchase securities convertible into shares of our common stock will be
 deemed to be the issuance of rights or warrants to purchase shares of our
 common stock into which those securities are convertible at an aggregate

                                      S-29
<PAGE>

 offering price equal to the sum of the aggregate offering price of those
 securities and the minimum aggregate amount, if any, payable upon conversion
 of those securities into shares of our common stock. This adjustment will be
 made successively whenever any such event occurs.

    (4) Distribution of indebtedness, securities or assets. In case we
 distribute to all holders of our common stock, whether by dividend or in a
 merger, amalgamation or consolidation or otherwise, evidences of
 indebtedness, shares of capital stock of any class or series, other
 securities, cash or assets, other than common stock, rights or warrants
 referred to in paragraph (3) above or a dividend payable exclusively in cash
 and other than as a result of a fundamental change described in paragraph (5)
 below, the conversion price in effect immediately before the close of
 business on the record date fixed for determination of shareholders entitled
 to receive that distribution will be reduced by multiplying the conversion
 price by a fraction, the numerator of which is the current market price on
 that record date less the fair market value, as determined by our board of
 directors, whose determination in good faith will be conclusive, of the
 portion of those evidences of indebtedness, shares of capital stock, other
 securities, cash and assets so distributed applicable to one share of common
 stock and the denominator of which is the current market price. This
 adjustment will be made successively whenever any such event occurs.

    (5) Fundamental changes. For purposes of this paragraph (5), "fundamental
 change" means any transaction or event, including any merger, consolidation,
 sale of assets, tender or exchange offer, reclassification, compulsory share
 exchange or liquidation, in which all or substantially all outstanding shares
 of our common stock are converted into or exchanged for stock, other
 securities, cash or assets. If a fundamental change occurs, the holder of
 each share of preferred stock outstanding immediately before that fundamental
 change occurred, will have the right upon any subsequent conversion to
 receive, but only out of legally available funds, to the extent required by
 applicable law, the kind and amount of stock, other securities, cash and
 assets that that holder would have received if that share had been converted
 immediately prior to the fundamental change.

    (6) Special adjustment for some changes in control. If we become subject
 to a "change in control" as defined below under the subheading "--Change in
 Control Put Right" in a transaction or series of related transactions in
 which (a) our shareholders receive consideration per share of common stock
 that is greater than the conversion price, without giving effect to the
 adjustment described below, at the effective time of the change in control
 and (b) at least 10% of the total consideration paid to our shareholders
 consists of cash, cash equivalents, securities that are not publicly-traded
 or other assets, which we refer to as "non-public consideration", then the
 conversion price will be adjusted so that, upon conversion of shares of
 preferred stock after the change in control, in addition to the common stock
 or other securities deliverable upon the conversion of the preferred stock as
 described under "Conversion Rights" and in paragraphs 1 through 5 above, the
 holder will receive securities having a value equal to the number of publicly
 traded securities of the acquiror determined through the following
 calculation:

<TABLE>
      <C>                 <C> <S>
      PV cashflows x (non-public consideration/total consideration)/Acquiror
      stock price


      where


      PV cashflows        =   the present value of the aggregate dividend
                              payments that would have been payable on the
                              preferred stock from the date of conversion
                              through    , 2005. The present value for this
                              purpose will be calculated using the rate equal
                              to the yield to maturity of U.S. Treasury
                              securities having a maturity closest to, but not
                              exceeding, 2005, plus 3.25%.

      Total consideration =   the total value of the consideration payable to
                              our shareholders at the effective time of the
                              change in control, with the value of any assets
                              or securities other than cash or a publicly-
                              traded security being determined in good faith by
                              our board of directors based upon an opinion as
                              to that value obtained from an accounting,
                              appraisal or investment banking firm of
                              international standing.
</TABLE>



                                      S-30
<PAGE>

<TABLE>
      <C>                  <C> <S>
      Acquiror stock price =   the price of the acquiror's publicly-traded
                               common stock or other publicly-traded securities
                               delivered in connection with the change in
                               control transaction at the effective time of the
                               change in control.
</TABLE>

   We will not, however, be required to give effect to any adjustment in the
conversion price unless and until the net effect of one or more adjustments,
each of which will be carried forward until counted toward adjustment, will
have resulted in a change of the conversion price by at least 1%, and when the
cumulative net effect of more than one adjustment so determined will be to
change the conversion price by at least 1%, that change in the conversion price
will be given effect. In the event that, at any time as a result of the
provisions of this section, the holder of shares of preferred stock upon
subsequent conversion become entitled to receive any shares of our capital
stock other than common stock, the number of those other shares so receivable
upon conversion of shares of preferred stock will thereafter be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions contained in this section.

   There will be no adjustment to the conversion price in case of the issuance
of any shares of our stock in a merger, reorganization, acquisition,
reclassification, recapitalization or other similar transaction except as
provided in this section.

   In any case in which this section requires that an adjustment as a result of
any event become effective from and after a record date, we may elect to defer
until after the occurrence of that event (a) issuing to the holder of any
shares of preferred stock converted after that record date and before the
occurrence of that event the additional shares of common stock issuable upon
that conversion over and above the shares issuable on the basis of the
conversion price in effect immediately before adjustment and (b) paying to that
holder any amount in cash in lieu of a fractional share of common stock.

   If we take a record of the holders of our common stock for the purpose of
entitling them to receive a dividend or other distribution, and after this and
before the distribution to our shareholders legally abandon our plan to pay or
deliver that dividend or distribution, then no adjustment in the number of
shares of our common stock issuable upon conversion of shares of preferred
stock or in the conversion price then in effect will be required by reason of
the taking of that record.

   Our board of directors will have the power to resolve any ambiguity or
correct any error in this section, and its action in so doing will be final and
conclusive.

   On or after April 15, 2005, we may, at our option, upon not less than 30 nor
more than 60 days' prior notice sent by first class mail to each holder's
registered address, cause the conversion rights of the shares of preferred
stock to terminate. We may exercise this option only if for at least 20 trading
days within any period of 30 consecutive trading days, including the last
trading day of that period, the current market price of our common stock
exceeds 140% of the conversion price, subject to adjustment in a number of
circumstances as provided under "--Adjustments to the Conversion Price" on page
S-29.

Change in Control Put Right

   For purposes of this section, "change in control" of Global Crossing means
the occurrence of any of the following:

     .  any "person", as that term is used in Section 13(d)(3) of the
        Exchange Act, other than a "permitted holder", is or becomes the
        beneficial owner, directly or indirectly, of 35% or more of the
        voting stock, measured by voting power rather than number of
        shares, of Global Crossing, and the permitted holders own, in the
        aggregate, a lesser percentage of the total voting stock, measured
        by voting power rather than by number of shares, of Global
        Crossing

                                      S-31
<PAGE>

        than that person and do not have the right or ability by voting
        power, contract or otherwise to elect or designate for election a
        majority of the board of directors of Global Crossing; for the
        purposes of this clause, that person will be deemed to
        "beneficially own" any voting stock of a specified corporation
        held by a parent corporation if that person beneficially owns,
        directly or indirectly, more than 35% of the voting stock,
        measured by voting power rather than by number of shares, of that
        parent corporation and the permitted holders beneficially own,
        directly or indirectly, in the aggregate a lesser percentage of
        voting stock, measured by voting power rather than by number of
        shares, of that parent corporation and do not have the right or
        ability by voting power, contract or otherwise to elect or
        designate for election a majority of the board of directors of
        that parent corporation;

     .  during any period of two consecutive years, "continuing directors"
        cease for any reason to constitute a majority of the board of
        directors of Global Crossing;

     .  Global Crossing consolidates or merges with or into any other
        person, other than a consolidation or merger (a) of Global
        Crossing into Global Crossing Holdings or Global Crossing Holdings
        into Global Crossing, or Global Crossing with or into a subsidiary
        of Global Crossing or (b) under a transaction in which the
        outstanding voting stock of Global Crossing is changed into or
        exchanged for cash, securities or other property with the effect
        that the beneficial owners of the outstanding voting stock of
        Global Crossing immediately before that transaction, beneficially
        own, directly or indirectly, more than 35% of the voting stock,
        measured by voting power rather than number of shares, of the
        surviving corporation immediately following that transaction; or

     .  the sale, transfer, conveyance or other disposition, other than by
        way of merger or consolidation, in one or a series of related
        transactions, of all or substantially all of the assets of Global
        Crossing and its subsidiaries, taken as a whole, to any person
        other than a subsidiary of Global Crossing or a permitted holder
        or a person more than 50% of the voting stock, measured by voting
        power rather than by number of shares, of which is owned, directly
        or indirectly, following such transaction or transactions by the
        permitted holders; however, sales, transfers, conveyances or other
        dispositions in the ordinary course of business of capacity on
        cable systems owned, controlled or operated by Global Crossing or
        any subsidiary or of telecommunications capacity or transmission
        rights acquired by Global Crossing or any subsidiary for use in
        its business, including for sale, lease, transfer, conveyance or
        other disposition to any customer of Global Crossing or any
        subsidiary will not be deemed a disposition of assets for purposes
        of this paragraph.

   For purposes of the above paragraph, "permitted holder" means Pacific
Capital Group and CIBC Oppenheimer Corp. and their respective affiliates; and
"continuing directors" means individuals who at the beginning of the period of
determination constituted the board of directors of Global Crossing, together
with any new directors whose election by that board of directors or whose
nomination for election by the shareholders of Global Crossing was approved by
a vote of at least a majority of the directors of Global Crossing then still in
office who were either directors at the beginning of that period or whose
election or nomination for election was previously so approved or is designee
of any one of the "permitted holders" or any combination of the permitted
holders or was nominated or elected by any permitted holder(s) or any of their
designees.

   If there is a change in control of Global Crossing, each holder of shares of
preferred stock will have the right to require us to purchase all or any part
of that holder's shares of preferred stock at a purchase price in cash equal to
100% of the liquidation preference of those shares, plus all accumulated and
unpaid dividends on those shares to the date of purchase. Within 30 days
following any change in control, we will mail a notice to each holder
describing the transaction or transactions that constitute the change in
control and offering to purchase that holder's preferred stock on the date
specified in that notice, which date will be no earlier than 30

                                      S-32
<PAGE>

days and no later than 60 days from the date the notice is mailed. We will have
the option to pay for those shares in shares of our common stock valued at 95%
of the average closing bid price of our common stock for the five trading days
before and including the third trading day before the repurchase date.

   We will comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations to the extent those laws and
regulations are applicable in connection with the purchase of preferred stock
as a result of a change in control. To the extent that the provisions of any
securities laws or regulations conflict with any of the provisions of this
section, we will comply with the applicable securities laws and regulations and
will be deemed not to have breached our obligations under this section.

   On the date scheduled for payment of the shares of preferred stock, we will,
to the extent lawful, (a) accept for payment all shares of preferred stock
properly tendered, (b) deposit with the transfer agent an amount equal to the
purchase price of the shares of preferred stock so tendered and (c) deliver or
cause to be delivered to the transfer agent shares of preferred stock so
accepted together with an officers' certificate stating the aggregate
liquidation preference of the shares of preferred stock being purchased by us.
The transfer agent will promptly mail or deliver to each holder of shares of
preferred stock so tendered the applicable payment for those shares of
preferred stock, and the transfer agent will promptly countersign and mail or
deliver, or cause to be transferred by book-entry, to each holder new shares of
preferred stock equal in liquidation preference to any unpurchased portion of
the shares of preferred stock surrendered, if any. We will publicly announce
the results of our offer on or as soon as practicable after the payment date
for the purchase of shares of preferred stock in connection with a change in
control of Global Crossing.

   We will not be required to make an offer to purchase any shares of preferred
stock upon the occurrence of a change in control of Global Crossing if a third
party makes that offer in the manner, at the times and otherwise in compliance
with the requirements described in this section and purchases all shares of
preferred stock validly tendered and not withdrawn.

   The right of the holders of shares of preferred stock described in this
section will be subject to the obligation of Global Crossing Holdings to:

     .  repay its debt obligations in full under its corporate credit
        facility; and

     .  offer to purchase and purchase all of its senior notes and
        outstanding shares of preferred stock that have been tendered for
        purchase in connection with a change in control of Global
        Crossing.

   In addition, the right of the holders of shares of preferred stock described
in this section will be subject to the repurchase or repayment of our future
indebtedness, which we are required to repurchase or repay in connection with a
change in control.

   When we have satisfied these obligations and, subject to the legal
availability of funds for this purpose, we will purchase all shares tendered
upon a change in control.

   In addition, the holders of shares of preferred stock may not be able to
exercise the rights described in this section if we fail to meet specified
solvency tests under Bermuda law. These solvency tests would require us to
determine that we will be solvent, taking into account the purchase of shares
of preferred stock as provided in this section, and that we will not otherwise
breach the provisions of any act, regulation or license applicable to us.

Exchange of Shares of Preferred Stock

   If we are reorganized so that the shares of our common stock are exchanged
for shares of the common stock of a new entity, the common stock of which is
traded on the Nasdaq National Market or another recognized securities exchange,
then, by notice to the holders of the preferred stock but without any required

                                      S-33
<PAGE>

consent on their part, we will have the option to cause the exchange of the
shares of preferred stock for shares of preferred stock of that new entity
having the same terms and conditions as provided in the certificate of
designations of the preferred stock. If we exercise that option, we will
indemnify the holders of shares of preferred stock if such an exchange would,
under then applicable United States federal income tax law, result in
the recognition of gain by holders of shares of the preferred stock. However,
we will not indemnify you for any payments described under "--Tax Redemption"
on page S-25 unless and to the extent it is so provided in that section.

   However, in the event that the new entity is not incorporated as a Bermuda
company or in the event the share structure of the new entity is not identical
to our own, the rights attaching to the preferred stock of the new entity may
be adjusted so as to comply with the local law of the country of incorporation
of that new entity or the share structure of that new entity.

Transfer Agent, Registrar and Dividend Disbursing Agent

   The transfer agent, registrar, dividend disbursing agent and redemption
agent for the shares of preferred stock is EquiServe.

Book-Entry Issuance

   The shares of preferred stock is issued as one or more global certificates
registered in the name of the DTC or its nominee. The depositary for the
preferred stock is the DTC.

                        CERTAIN INCOME TAX CONSEQUENCES

   We describe certain income tax consequences in connection with this offering
beginning on page 42 of the prospectus.

                                      S-34
<PAGE>

                                  UNDERWRITING

   We have entered into an underwriting agreement with the underwriters named
below, for whom Salomon Smith Barney Inc., Goldman, Sachs & Co. and Merrill
Lynch, Pierce, Fenner & Smith Incorporated are acting as representatives.
Subject to the terms and conditions of the underwriting agreement, we have
agreed to sell, and each underwriter severally and not jointly has agreed to
purchase from us, the number of shares of our preferred stock indicated
opposite its name below. The underwriters have agreed, subject to the terms and
conditions of the underwriting agreement, to purchase all of the shares of our
preferred stock offered on the cover page of this prospectus supplement, if any
are purchased. Under some circumstances, under the underwriting agreement, the
commitment of a non-defaulting underwriter may be increased.

<TABLE>
<CAPTION>
                                                                        Number
                                Underwriters                           of shares
                                ------------                           ---------
      <S>                                                              <C>
      Salomon Smith Barney Inc. ......................................
      Goldman, Sachs & Co. ...........................................
      Merrill Lynch, Pierce, Fenner & Smith
               Incorporated...........................................
                                                                       ---------
                                                                       3,000,000
                                                                       ---------
</TABLE>

   The underwriters have, for a period of 30 days from the date of this
prospectus supplement, an over-allotment option to purchase up to 450,000
additional shares from us. If any additional shares are purchased, the
underwriters will severally purchase the shares in the same proportion as in
the table above.

   The representatives of the underwriters have advised us that the shares will
be offered to the public at the offering price indicated on the cover page of
this prospectus supplement. The underwriters may allow to selected dealers a
concession not in excess of $   per share and those dealers may reallow a
concession not in excess of $   per share to some other dealers. After the
shares are released for sale to the public, the representatives may change the
offering price and the concessions.

   We have agreed to pay to the underwriters the following fees, assuming both
no exercise and full exercise of the underwriters' over-allotment option to
purchase additional shares:

<TABLE>
<CAPTION>
                                                     Total Fees
                                     -------------------------------------------
                             Price    Without exercise of    With exercise of
                           per share over-allotment option over-allotment option
                           --------- --------------------- ---------------------
<S>                        <C>       <C>                   <C>
Fees paid by us...........    $              $                     $
</TABLE>

   In addition, we estimate that we will spend approximately $    in expenses
in this offering. We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act, or contribute to
payments that the underwriters may be required to make in respect of these
liabilities.

   Subject to specified exceptions, we have agreed not to offer or sell any
shares of our common stock or other equity securities for a period ending 45
days from the date of this prospectus supplement without the prior written
consent of Salomon Smith Barney Inc. and Goldman, Sachs & Co.

   Each of the selling shareholders in our concurrent offering of common stock
has agreed, subject to specified exceptions, not to offer or sell any shares of
our common stock for a period ending (1) 90 days from the date of this
prospectus supplement, in the case of selling shareholders who are executive
officers or (2) May 25, 2000, in the case of selling shareholders who are not
executive officers. In addition, each of our other executive officers has
agreed, subject to specified exceptions, not to offer or sell any shares of our
common stock for a period ending 90 days from the date of this prospectus
supplement other than a specified number of shares of common stock beneficially
owned by those executive officers totalling 1,250,000 shares in the aggregate.
Each of these contractual obligations will expire on April 28, 2000 if the
concurrent offering of our common stock is not completed by that date.

                                      S-35
<PAGE>

   In connection with this offering, Salomon Smith Barney Inc., on behalf of
the underwriters, may purchase and sell shares of our preferred stock in the
open market. These transactions may include over-allotment, syndicate covering
transactions and stabilizing transactions. Over-allotment involves syndicate
sales of preferred stock in excess of the number of shares to be purchased by
the underwriters in the offering, which creates a syndicate short position.
Syndicate covering transactions involve purchases of the preferred stock in the
open market after the distribution has been completed in order to cover
syndicate short positions. Stabilizing transactions consist of certain bids or
purchases of preferred stock made for the purpose of preventing or retarding a
decline in the market price of the preferred stock while the offering is in
progress.

   The underwriters also may impose a penalty bid. Penalty bids permit the
underwriters to reclaim a selling concession from a syndicate member when
Salomon Smith Barney Inc., in covering syndicate short positions or making
stabilizing purchases, repurchases shares originally sold by that syndicate
member.

   Any of these activities may cause the price of the stock to be higher than
the price that otherwise would exist in the open market in the absence of such
transactions. These transactions may be effected in the over-the-counter
market, or otherwise and, if commenced, may be discontinued at any time.


   Neither we nor the underwriters make any representation or prediction as to
the direction or magnitude of any effect that the transactions described above
may have on the price of the shares of our preferred stock. In addition,
neither we nor the underwriters make any representation that the underwriters
will engage in that type of transactions or that these transactions, once
commenced, will not be discontinued without notice.

   The underwriters and their affiliates have from time to time in the past or
may in the future perform certain investment banking, advisory and financial
services for us and our affiliates, for which they have received or will
receive customary fees and expenses. Citibank, N.A., an affiliate of Salomon
Smith Barney Inc., is a lender to us under our existing credit facility.
Salomon Smith Barney Inc., Goldman, Sachs & Co. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated were initial purchasers of our 6 3/8% cumulative
convertible preferred stock and our 7% cumulative convertible preferred stock,
for which they received customary fees.

                                 LEGAL MATTERS

   The validity of our shares of preferred stock and common stock into which
those shares of preferred stock are convertible will be passed upon by our
counsel, Appleby, Spurling & Kempe, Hamilton, Bermuda. Certain legal matters
under United States and New York law with respect to the shares being offered
will be passed upon for us by Simpson Thacher & Bartlett, New York, New York
and for the underwriters by Latham & Watkins, New York, New York. Simpson
Thacher & Bartlett and Latham & Watkins will rely, as to matters of Bermuda
law, on the opinion of Appleby, Spurling & Kempe, Hamilton, Bermuda. As of
March 3, 2000, lawyers of Simpson Thacher & Bartlett who have participated in
the preparation of this document beneficially owned less than 1% of the
outstanding shares of our common stock.

                                    EXPERTS

   The consolidated financial statements of Global Crossing and its
subsidiaries incorporated by reference in this prospectus supplement and
elsewhere in the registration statement have been audited by Arthur Andersen,
independent public accountants, as indicated in their reports with respect to
those consolidated financial statements, and are incorporated by reference in
reliance upon the authority of said firm as experts in giving said reports.

   The consolidated financial statements incorporated by reference in this
registration statement of which this prospectus supplement is a part to the
annual report on Form 10-K of Frontier Corporation for the year ended

                                      S-36
<PAGE>

December 31, 1998 and audited historical financial statements included on pages
22-42 of Frontier Corporation's Form 8-K dated January 26, 1999, have been so
incorporated in reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.

   The combined financial statements of Global Marine Systems incorporated by
reference in this prospectus have been incorporated by reference in reliance
upon the report of KPMG Audit Plc, chartered accountants, incorporated by
reference in this prospectus and upon the authority of said firm as experts in
accounting and auditing.

   The financial statements of Racal Telecom incorporated by reference in this
registration statement of which this prospectus is a part have been audited by
Deloitte & Touche, independent auditors, as stated in their report incorporated
by reference in this registration statement of which this prospectus is a part.

   The consolidated financial statements incorporated by reference in this
registration statement of which this prospectus is a part of HCL Holdings
Limited and subsidiaries have been so incorporated in reliance on the reports
of PricewaterhouseCoopers, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

                                      S-37
<PAGE>

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


                                3,000,000 Shares

                    % Cumulative Convertible Preferred Stock





                          [LOGO] Global Crossing Ltd.


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

                             PROSPECTUS SUPPLEMENT

                                       , 2000

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

                              Salomon Smith Barney

                              Goldman, Sachs & Co.

                              Merrill Lynch & Co.



- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the     +
+Securities and Exchange Commission is effective. This prospectus is not an    +
+offer to sell these securities and is not soliciting an offer to buy these    +
+securities in any state where the offer or sale is not permitted.             +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

                Subject to completion, dated March 31, 2000

PROSPECTUS
                                 $8,000,000,000

[Logo Global Crossing Ltd.]


                                Debt Securities
                                Preferred Stock
                                  Common Stock
                                    Warrants

                                  -----------


  This prospectus includes a general description of the debt securities, shares
of preferred stock, shares of common stock and warrants we may issue from time
to time. We will provide specific terms of these securities in supplements to
this prospectus. You should read this prospectus and each supplement carefully
before you invest.

  In addition, some of our shareholders may sell a number of shares of our
common stock under this prospectus and any prospectus supplement. In the
prospectus supplement relating to sales by selling shareholders, we will
identify each selling shareholder and the number of shares of our common stock
that each selling shareholder will be selling.

  Our common stock trades on the Nasdaq National Market and the Bermuda Stock
Exchange under the symbol "GBLX".

                                  -----------

  Investing in our securities involves risks, which we describe in the "Risk
Factors" section beginning on page 20 of this prospectus.

  Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.

                                  -----------

                The date of this prospectus is      , 2000.
<PAGE>


   You should rely only on the information contained or incorporated by
reference in this prospectus and any prospectus supplement. We have not
authorized anyone to provide you with different information. We are not making
an offer to sell these securities in any state where the offer is not
permitted. You should not assume that the information contained in this
prospectus or any prospectus supplement is accurate as of any date other than
the date on the front cover of those documents.

                             TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
About this Prospectus......................................................  ii
Where You Can Find More Information........................................  ii
Incorporation by Reference.................................................  ii
Summary....................................................................   1
Risk Factors...............................................................  20
Cautionary Statement Regarding Forward-Looking Statements..................  27
Use of Proceeds............................................................  27
Dividend Policy............................................................  27
Description of Debt Securities.............................................  28
Description of Preferred Stock.............................................  36
Description of Common Stock................................................  38
Description of Warrants....................................................  40
Certain Income Tax Consequences............................................  42
Selling Shareholders.......................................................  55
Plan of Distribution.......................................................  56
Legal Matters..............................................................  58
Experts....................................................................  58
Service of Process and Enforcement of Liabilities..........................  58
</TABLE>

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

   The Bermuda Monetary Authority has given its consent to the issue and the
transfer of the securities that we or the selling shareholders may issue under
this prospectus and each prospectus supplement. Approvals or permissions
received from the Bermuda Monetary Authority do not constitute a guaranty by
the Bermuda Monetary Authority as to our performance or our credit worthiness.
Accordingly, in giving those approvals or permissions, the Bermuda Monetary
Authority will not be liable for our performance or default or for the
correctness of any opinions or statements expressed in this document.

   The Bermuda Monetary Authority has classified us as non-resident in Bermuda
for exchange control purposes. Accordingly, we may convert currency, other than
Bermuda currency, held for our account to any other currency without
restriction. Persons, firms or companies regarded as residents of Bermuda for
exchange control purposes require specific consent under the Exchange Control
Act, 1972 of Bermuda, and regulations promulgated under the Act, to purchase
any shares in our capital stock or any other securities that we may issue.
Under the terms of the consent given to us by the Bermuda Monetary Authority,
(1) the issuance and transfer of the securities that we may issue and (2) the
transfer of the securities that any selling shareholders may sell under this
prospectus and each prospectus supplement between persons, firms or companies
regarded as non-resident in Bermuda for exchange control purposes may be
effected without further permission from the Bermuda Monetary Authority.

                                       i
<PAGE>


                           ABOUT THIS PROSPECTUS

   This prospectus is part of a registration statement that we filed with the
SEC using a shelf registration process. Under the shelf registration process,
we may offer from time to time debt securities, shares of preferred stock,
shares of common stock and warrants up to an aggregate amount of
$8,000,000,000. In addition, some of our shareholders may sell shares of our
common stock under our shelf registration statement. This prospectus provides
you with a general description of the securities we or any selling shareholders
may offer. Each time we or any selling shareholders offer securities, in
addition to this prospectus we will provide you with a prospectus supplement
that will contain specific information about the securities being offered. The
prospectus supplement may also add, update or change information contained in
this prospectus. You should read both this prospectus and any prospectus
supplement as well as additional information described under "Where You Can
Find More Information" immediately below.

                    WHERE YOU CAN FIND MORE INFORMATION

   We file reports, proxy statements and other information with the SEC. You
may read and copy these reports, proxy statements and other information at the
public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the SEC's regional offices located
at 7 World Trade Center, 13th floor, New York, New York 10048 and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. You may also obtain copies
of those materials at prescribed rates from the public reference section of the
SEC at 450 Fifth Street, Washington, D.C. 20549. You may obtain copies from the
public reference room by calling the SEC at (800) 732-0330. In addition, we are
required to file electronic versions of those materials with the SEC through
the SEC's EDGAR system. The SEC maintains a web site at http://www.sec.gov that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the SEC. You may also
review reports and other information concerning us at the offices of the
National Association of Securities Dealers, Inc. at 1735 K Street, N.W.,
Washington, D.C. 20001-1500.

   You may also request a copy of those materials, free of cost, by writing or
telephoning us at the following address:

    Investor Relations

    Global Crossing Ltd.

    360 N. Crescent Drive

    Beverly Hills, CA 90210

    310-385-5200

                        INCORPORATION BY REFERENCE

   The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. We incorporate by reference in this
prospectus the information contained in the following documents:

  .  our annual report on Form 10-K for the fiscal year ended December 31,
     1999;

  .  our current reports on Form 8-K filed on January 11, 2000, as amended by
     Form 8-K/A filed on January 19, 2000; February 18, 2000; March 2, 2000;
     and March 3, 2000;

  .  the financial statements of Frontier Corporation and the Global Marine
     Systems business of Cable & Wireless Plc incorporated by reference or
     included in our Registration Statement on Form S-4 filed on September 8,
     1999 (File No. 333-86693); and

  .  all documents that we file with the SEC under Sections 13(a), 13(c), 14
     or 15 of the Securities Exchange Act of 1934 until all the securities
     that we or any selling shareholders may offer under this prospectus are
     sold.

                                       ii
<PAGE>


   You may obtain copies of those documents from us, free of cost, by
contacting us at the address or telephone number provided in "Where You Can
Find More Information" immediately above.

   Information that we file later with the SEC and that is incorporated by
reference in this prospectus will automatically update and supersede
information contained in this prospectus. You will be deemed to have notice of
all information incorporated by reference in this prospectus as if that
information was included in this prospectus.

                                      iii
<PAGE>

                                    SUMMARY

   This section contains a general summary of the information contained in this
prospectus. It may not include all the information that is important to you.
You should read the entire prospectus, any accompanying prospectus supplement
and the documents incorporated by reference before making an investment
decision.

                              Global Crossing Ltd.

   We are building and offering services over the world's first integrated
global fiber optic network, consisting of 101,000 announced route miles and
serving five continents, 27 countries and more than 200 major cities. Upon
completion of our currently announced systems, our network and its
telecommunications and Internet product offerings will be available in markets
constituting over 80% of the world's international communications traffic.

   We are included in both the S&P 500 index and the Nasdaq 100 index. Our
operations are headquartered in Hamilton, Bermuda, with executive offices in
Los Angeles, California; Morristown, New Jersey; and Rochester, New York.

   We are incorporated in Bermuda, and the address of our principal executive
offices is Wessex House, 45 Reid Street, Hamilton HM12, Bermuda. Our telephone
number is 441-296-8600. You may visit us at our web site located at
www.globalcrossing.com.

            The Securities We or Selling Shareholders May Offer

   Each time we or any selling shareholders offer securities under this
prospectus, we will provide you with a prospectus supplement that will contain
the specific terms of the securities being offered. The following is a summary
of the securities we or some of our shareholders may offer under this
prospectus.

Debt Securities

   We may offer unsecured general obligations of ours, which may be either
senior or subordinated and may be convertible into shares of our common stock
or preferred stock. In this prospectus, we refer to the senior debt securities
and the subordinated debt securities together as the "debt securities". The
senior debt securities will have the same rank as all our other unsecured and
unsubordinated debt. The subordinated debt securities will be entitled to
payment only after payment on our senior debt. In addition, the subordinated
debt securities will be effectively subordinated to creditors and preferred
shareholders of our subsidiaries. Our board of directors will determine the
terms of each series of debt securities being offered.

   We will issue the debt securities under an indenture between us and United
States Trust Company of New York, as the trustee. In this document, we have
summarized general features of the debt securities from the indenture. We
encourage you to read the indenture which is an exhibit to the registration
statement of which this prospectus is a part.

Preferred Stock

   We may issue shares of our preferred stock, par value $0.01 per share, in
one or more series. Our board of directors will determine the dividend, voting,
conversion and other rights of the series of shares of preferred stock being
offered.

Common Stock

   We may issue and sell shares of our common stock, par value $0.01 per share.
In addition, some of our shareholders may sell shares of our common stock. In
this prospectus, we provide a general description of, among other things, our
dividend policy and the transfer and voting restrictions that apply to holders
of our common stock.

                                       1
<PAGE>


Warrants

   We may issue warrants for the purchase of debt securities, shares of
preferred stock or shares of common stock. Our board of directors will
determine the terms of the warrants.

           Ratio of Earnings to Fixed Charges and Preferred Dividends

   The following table presents our historical ratios of earnings to fixed
charges and preferred dividends for the periods indicated:

<TABLE>
<CAPTION>
                                                                Period From
                                   Year Ended   Year Ended     March 19, 1997
                                  December 31, December 31, (Date of Inception)
                                      1999         1998     to December 31, 1997
                                  ------------ ------------ --------------------
      <S>                         <C>          <C>          <C>
      Ratio......................        --           --               --
      Deficiency.................   $(49,607)    $(95,371)        $(12,850)
</TABLE>

   For the purpose of this computation, earnings are defined as income (loss)
before income taxes plus fixed charges and preferred dividends. Fixed charges
consist of interest expense, including amortization of deferred debt issuance
costs and the interest portion of capital lease obligations, and the portion of
rental expense that is representative of the interest factor, deemed to be one-
third of minimum operating lease rentals.

                   Selected historical financial information

   We acquired Global Marine Systems on July 2, 1999 and Frontier on September
28, 1999.

   On November 24, 1999, we formed, together with Softbank Corp. and Microsoft
Corporation, a new joint venture company called Asia Global Crossing. We have
contributed to Asia Global Crossing our 57.75% ownership interest in Pacific
Crossing and our development rights in East Asia Crossing. Among other things,
each of Softbank and Microsoft contributed $175 million in cash to Asia Global
Crossing. Also on November 24, 1999, we acquired Racal Telecom, a group of
wholly-owned subsidiaries of Racal Electronics plc. On January 12, 2000, we
formed a joint venture with Hutchison Whampoa Limited, called Hutchison Global
Crossing, and issued $400 million aggregate liquidation preference of our 6
3/8% cumulative convertible preferred stock, series B, to Hutchison Whampoa.

   On February 22, 2000, we announced a definitive agreement to acquire IXnet,
Inc., a leading provider of specialized IP-based network services to the global
financial services community, and its parent company, IPC Communications, Inc.,
in exchange for shares of our common stock valued at approximately $3.8
billion. Under the terms of the definitive merger agreement, 1.184 shares of
our common stock will be exchanged for each share of IXnet common stock not
owned by IPC and 5.417 shares of our common stock will be exchanged for each
share of IPC common stock. We expect the acquisition to be completed in the
second quarter of 2000. The acquisition is subject to regulatory approval and
customary closing conditions.

   In the following tables, we provide selected historical financial
information for (1) Global Crossing, (2) Global Marine Systems, (3) Frontier,
(4) Racal Telecom and (5) HCL Holdings Limited, a group of wholly-owned
subsidiaries of Hutchison Whampoa which has been contributed into the Hutchison
Global Crossing joint venture. We do not provide any separate historical
financial information relating to the Asia Global Crossing joint venture, as
all relevant historical financial information is reflected in the historical
financial information of Global Crossing.

                                       2
<PAGE>


   The selected historical financial information presented in the following
tables has been derived from the audited and unaudited financial statements of
Global Crossing, Global Marine Systems, Frontier, Racal Telecom and HCL
Holdings for the periods presented. This information is only a summary, and you
should read it together with the more detailed historical financial information
included or incorporated by reference in this document. For instructions on how
to obtain information incorporated by reference, see "Where You Can Find More
Information" on page ii.

Global Crossing selected historical financial information

   The table below shows the selected historical financial information for
Global Crossing. This information has been prepared using the consolidated
financial statements of Global Crossing as of the dates indicated and for each
of the fiscal years in the period from inception, March 19, 1997, to December
31, 1999. The consolidated income statement data below for each of the fiscal
years in the period from inception, March 19, 1997, to December 31, 1999 and
the consolidated balance sheet data as of December 31, 1999 and 1998 have been
derived from financial statements audited by Arthur Andersen, independent
public accountants, which are incorporated by reference in this document. We
derived the remaining data from unaudited condensed consolidated financial
statements.

   In reading the following selected historical financial information, please
note the following:

  .  The statement of operations data for the year ended December 31, 1999
     includes the results of Global Marine Systems for the period from July
     2, 1999, date of acquisition, through December 31, 1999; the results of
     Frontier for the period from September 30, 1999, date of acquisition,
     through December 31, 1999; and the results of Racal Telecom for the
     period from November 24, 1999; date of acquisition, through December 31,
     1999. The consolidated balance sheet as of December 31, 1999 includes
     amounts related to Global Marine Systems, Frontier and Racal Telecom.

  .  During the year ended December 31, 1999, we recorded a $15 million
     expense, net of tax benefit, due to the adoption of Statement of
     Position 98-5, "Reporting on the Cost of Start-Up Activities". See the
     "Cumulative effect of change in accounting principles" item in the
     statement of operations data.

  .  During the years ended December 31, 1999 and 1998, we recognized $51
     million and $39 million, respectively, of stock-related expense relating
     to stock options and rights to purchase stock issued during that period
     which entitle the holders to purchase common stock. See the "Stock-
     related expense" item in the statement of operations data.

  .  On December 15, 1999, we issued 2,600,000 shares of 7% cumulative
     convertible preferred stock at a liquidation preference of $250.00 for
     net proceeds of $630 million. Each share of preferred stock is
     convertible into 4.6948 shares of common stock based on a conversion
     price of $53.25. Dividends on the preferred stock are cumulative from
     the date of issue and will be payable on February 1, May 1, August 1 and
     November 1 of each year, beginning on February 1, 2000, at the annual
     rate of 7%.

  .  On November 24, 1999, we completed our acquisition of Racal Telecom, a
     group of wholly owned subsidiaries of Racal Electronics plc, for
     approximately $1.6 billion in cash. Racal Telecom owns one of the most
     extensive fiber telecommunications networks in the United Kingdom,
     consisting of approximately 4,650 route miles of fiber and reaching more
     than 2,000 cities and towns.

  .  On November 12, 1999, our wholly owned subsidiary, Global Crossing
     Holdings Ltd., issued two series of senior unsecured notes, which we
     refer to in this document as the "new senior notes". The 9 1/8% senior
     notes are due November 15, 2006 with a face value of $900 million, and
     the 9 1/2% senior notes are due November 15, 2009 with a face value of
     $1,100 million. The new senior notes are guaranteed by us. Interest will
     be paid on the notes on May 15 and November 15 of each year, beginning
     on May 15, 2000.

                                       3
<PAGE>


  .  On November 5, 1999, we issued 10,000,000 shares of 6 3/8% cumulative
     convertible preferred stock at a liquidation preference of $100.00 for
     net proceeds of approximately $969 million. Each share of preferred
     stock is convertible into 2.2222 shares of common stock, based on a
     conversion price of $45.00. Dividends on the preferred stock are
     cumulative from the date of issue and will be payable on February 1, May
     1, August 1 and November 1 of each year, beginning on February 1, 2000,
     at the annual rate of 6 3/8%.

  .  On September 28, 1999, we completed the acquisition of Frontier in a
     merger transaction valued at over $10 billion, with Frontier
     shareholders receiving 2.05 shares of our common stock for each share of
     Frontier common stock held. Frontier is one of the largest long distance
     telecommunications companies in the United States and one of the leading
     providers of facilities-based integrated communications and Internet
     services.

  .  On July 2, 1999, we completed our acquisition of the Global Marine
     Systems division of Cable & Wireless Plc for approximately $908 million
     in cash and assumed liabilities. Global Marine Systems owns the largest
     fleet of cable laying and maintenance vessels in the world and currently
     services more than a third of the world's undersea cable miles.

  .  On May 16, 1999, we entered into a definitive agreement to merge with U
     S WEST, Inc. On July 18, 1999, we and U S WEST agreed to terminate our
     merger agreement, and U S WEST agreed to merge with Qwest Communications
     International Inc. As a result, U S WEST paid us a termination fee of
     $140 million in cash and returned 2,231,076 shares of our common stock
     purchased in a related tender offer, and Qwest committed to purchase
     capacity on the Global Crossing network at established market unit
     prices for delivery over the next four years and committed to make
     purchase price payments to us for this capacity of $140 million over the
     next two years. During the year ended December 31, 1999, we recognized
     $210 million, net of merger related expenses, of other income in
     connection with the termination of the U S WEST merger agreement.

  .  The "Termination of advisory services agreement" item in the statements
     of operations data includes a charge for the termination of the advisory
     services agreement as of June 30, 1998. We acquired the rights from
     those entitled to fees payable under the advisory services agreement in
     consideration for the issuance of common stock having an aggregate value
     of $135 million and the cancellation of approximately $3 million owed to
     us under a related advance agreement. As a result of this transaction,
     we recorded a non-recurring charge in the approximate amount of $138
     million during the year ended December 31, 1998. In addition, we
     recognized as an expense approximately $2 million of advisory fees
     incurred before the termination of the contract.

  .  We granted warrants to Pacific Capital Group, Inc., a shareholder, and
     some of its affiliates for the Pacific Crossing, Mid-Atlantic Crossing
     and Pan American Crossing systems and related rights. The $275 million
     value of the common stock was originally allocated to "Construction in
     progress" in the amount of $112 million and as "Investment in and
     advances to/from affiliates" in the amount of $163 million. See the
     "property and equipment" item in the balance sheet data. The "Investment
     in and advance to/from affiliates" item in the balance sheet data
     includes $163 million as of December 31, 1999 and 1998, respectively,
     representing the value of the warrants described in the bullet point
     immediately above applicable to the Pacific Crossing system.

  .  Adjusted EBITDA is defined as operating income (loss), plus goodwill
     amortization, depreciation and amortization, non-cash cost of capacity
     sold, stock related expenses, incremental cash deferred revenue, and
     amounts relating to the termination of the advisory services agreement
     this definition is consistent with financial covenants contained in our
     major financial agreements. This information should not be considered as
     an alternative to any measure of performance as promulgated under
     generally accepted accounting principles, which we refer to as "GAAP".
     Our calculation of adjusted EBITDA may be different from the calculation
     used by other companies and, therefore, comparability may be limited.

                                       4
<PAGE>

                     Global Crossing Ltd. and Subsidiaries
             (in thousands, except share and per share information)


<TABLE>
<CAPTION>
                                                                  Period from
                                                                 March 19, 1997
                             Year Ended        Year Ended     (Date of Inception)
                          December 31, 1999 December 31, 1998 to December 31, 1997
                          ----------------- ----------------- --------------------
<S>                       <C>               <C>               <C>
Statement of Operations
 Data:
Revenue.................     $ 1,664,824       $   419,866        $       --
                             -----------       -----------        -----------
Expenses:
 Cost of sales..........         850,483           178,492                --
 Operations,
  administration and
  maintenance...........         133,202            18,056                --
 Sales and marketing....         149,119            26,194              1,366
 Network development....          26,153            10,962                 78
 General and
  administrative........         210,107            26,303              1,618
 Stock related expense
  ......................          51,306            39,374                --
 Depreciation and
  amortization..........         124,294               541                 39
 Goodwill and
  intangibles
  amortization..........         127,621               --                 --
 Termination of advisory
  services agreement ...             --            139,669                --
                             -----------       -----------        -----------
                               1,672,285           439,591              3,101
                             -----------       -----------        -----------
Operating loss..........          (7,461)          (19,725)            (3,101)
Equity in income (loss)
 of affiliates..........          15,708            (2,508)               --
Minority interest.......          (1,338)              --                 --
Other income (expense):
 Interest income........          67,407            29,986              2,941
 Interest expense.......        (139,077)          (42,880)               --
 Other income, net......         180,765               --                 --
Provision for income
 taxes..................        (126,539)          (33,067)               --
                             -----------       -----------        -----------
Loss before
 extraordinary item and
 cumulative effect of
 change in accounting
 principle..............         (10,535)          (68,194)              (160)
Extraordinary loss on
 retirement of debt.....         (45,681)          (19,709)               --
                             -----------       -----------        -----------
Loss before cumulative
 effect of change in
 accounting principle...         (56,216)          (87,903)              (160)
Cumulative effect of
 change in accounting
 principle, net of
 income tax benefit of
 $1,400.................         (14,710)              --                 --
                             -----------       -----------        -----------
Net loss................         (70,926)          (87,903)              (160)
Preferred stock
 dividends..............         (66,642)          (12,681)           (12,690)
Redemption of preferred
 stock..................             --            (34,140)                --
                             -----------       -----------        -----------
Net loss applicable to
 common shareholders....     $  (137,568)      $  (134,724)       $   (12,850)
                             ===========       ===========        ===========
Net Loss Per Common
 Share:
Loss applicable to
 common shareholders
 before extraordinary
 item and cumulative
 effect of change in
 accounting principle
Basic and diluted.......     $     (0.15)      $     (0.32)       $     (0.04)
                             ===========       ===========        ===========
Extraordinary item
 Basic and diluted......     $     (0.09)      $     (0.06)       $       --
                             ===========       ===========        ===========
Cumulative effect of
 change in accounting
 principle
 Basic and diluted......     $     (0.03)      $       --         $       --
                             ===========       ===========        ===========
Net loss applicable to
 common shareholders
 Basic and diluted......     $     (0.27)      $     (0.38)       $     (0.04)
                             ===========       ===========        ===========
Shares used in computing
 basic and diluted loss
 per share..............     502,400,851       358,735,340        325,773,934
                             ===========       ===========        ===========
Other Operating Data:
Cash from operating
 activities.............     $   506,084       $   208,727        $     5,121
Cash used for investing
 activities.............      (4,009,977)         (430,697)          (428,743)
Cash from financing
 activities.............       4,330,799         1,027,110            425,075
Adjusted EBITDA ........     $   708,181       $   364,948        $   343,233
</TABLE>

                                       5
<PAGE>

                     Global Crossing Ltd. and Subsidiaries
                                 (in thousands)

<TABLE>
<CAPTION>
                                                       December 31,
                                              ---------------------------------
                                                 1999         1998       1997
                                              -----------  ----------  --------
<S>                                           <C>          <C>         <C>
Balance sheet data:
Current assets including cash and cash
 equivalents and restricted cash and cash
 equivalents................................  $ 2,946,533  $  976,615  $ 27,744
Long term restricted cash and cash
 equivalents................................      138,118     367,600       --
Long term accounts receivable...............       52,052      43,315       --
Capacity available for sale.................          --      574,849       --
Property and equipment, net ................    6,026,053     433,707   518,519
Other assets................................      661,442      65,757    25,934
Investment in and advances to/from
 affiliates, net............................      323,960     177,334       --
Goodwill and intangibles, net...............    9,557,422         --        --
                                              -----------  ----------  --------
 Total assets...............................  $19,705,580  $2,639,177  $572,197
                                              ===========  ==========  ========
Current liabilities.........................  $ 1,852,593  $  256,265  $ 90,817
Long term debt..............................    5,018,544   1,066,093   312,325
Deferred revenue............................      383,287      25,325       --
Deferred credits and other..................      796,606      34,174     3,009
                                              -----------  ----------  --------
Total Liabilities...........................    8,051,030   1,381,857   406,151
Minority interest...........................      351,338         --        --
Mandatorily redeemable and cumulative
 convertible preferred stock ...............    2,084,697     483,000    91,925
Shareholders' equity
 Common stock...............................        7,992       4,328     3,258
 Treasury stock.............................     (209,415)   (209,415)      --
 Other shareholders' equity.................    9,578,927   1,067,470    71,023
 Accumulated deficit........................     (158,989)    (88,063)     (160)
                                              -----------  ----------  --------
Total shareholders' equity..................    9,218,515     774,320    74,121
                                              -----------  ----------  --------
Total liabilities and shareholders' equity..  $19,705,580  $2,639,177  $572,197
                                              ===========  ==========  ========
</TABLE>

                                       6
<PAGE>

Global Marine Systems selected historical financial information

   The table below shows selected historical financial information for Global
Marine Systems presented in United States GAAP. This information has been
prepared using the combined financial statements of Global Marine Systems as of
the dates indicated and for each of the fiscal years in the five-year period
ended March 31, 1999. The combined income statement data below for each of the
three fiscal years ended March 31, 1999 and the combined balance sheet data at
March 31, 1999 and 1998 were derived from United Kingdom GAAP financial
statements audited by KPMG Audit Plc, chartered accountants, which are
incorporated by reference in this document. The combined income statement data
below for each of the fiscal years ended March 31, 1996 and 1995 and the
combined balance sheet data as of March 31, 1997, 1996 and 1995 were derived
from management accounts.

   The unaudited translations of Global Marine Systems' sterling amounts into
United States dollars have been translated using convenience translation rates
for the fiscal year ended March 31, 1999. The convenience translations should
not be construed as representations that the sterling amounts have been, could
have been or could in the future be converted into United States dollars at
this rate or any other rate of exchange.

<TABLE>
<CAPTION>
                                                      For the Years Ended March 31,
                         ----------------------------------------------------------------------------------------
                                   1999                1998            1997            1996            1995
                         ------------------------ --------------- --------------- --------------- ---------------
                                                                                            (unaudited)
                                                              (in thousands)
<S>                      <C>      <C>             <C>             <C>             <C>             <C>
Operating revenues...... $347,335 (Pounds)209,997 (Pounds)170,953 (Pounds)181,987 (Pounds)147,996 (Pounds) 79,778
Income from continuing
 operations.............   47,051          28,447          13,843          18,992          26,923          10,829
Total assets............  753,333         466,749         441,899         380,635         359,148         235,459
Long-term obligations... $261,923 (Pounds)162,282 (Pounds)198,055 (Pounds)163,209 (Pounds)167,454 (Pounds) 54,900
</TABLE>

Frontier selected historical financial information

   The table below shows selected historical financial information for
Frontier. This information has been prepared using the consolidated financial
statements of Frontier as of the dates indicated and for each of the fiscal
years in the five-year period ended December 31, 1998 and for the nine months
ended September 30, 1999 and 1998. The consolidated income statement data below
for each of the fiscal years in the five-year period ending December 31, 1998
and the consolidated balance sheet data as of December 31, 1994 through
December 31, 1998 have been derived from financial statements audited by
PricewaterhouseCoopers LLP, independent accountants, of which the financial
statements for the three-year period ending December 31, 1998 are incorporated
by reference in this document. Global Crossing derived the remaining data from
unaudited consolidated financial statements, which are incorporated by
reference in this document.

   Revenues have been impacted by the following acquisitions for the periods
presented:

  .  On February 27, 1998, Frontier acquired GlobalCenter Inc., a leading
     provider in digital distribution, Internet and data services
     headquartered in Sunnyvale, California. Frontier acquired all of the
     outstanding shares of GlobalCenter and issued 6.4 million shares to
     effect this merger. At the time of the merger, GlobalCenter had 1.1
     million stock options and warrants outstanding as converted into
     Frontier equivalents. This transaction was accounted for using the
     pooling of interests method of accounting and, accordingly, historical
     information has been restated to include GlobalCenter.

  .  In August 1995, Frontier merged with ALC Communications Corporation.
     Frontier exchanged two shares of its common stock for each ALC common
     share. The total shares issued by Frontier to effect the merger were
     69.2 million. In March 1995, Frontier acquired American Sharecom Inc.
     Frontier acquired all of the outstanding shares of American Sharecom for
     approximately 8.7 million shares of Frontier common stock. These
     transactions were accounted for as poolings of interests and,
     accordingly, historical information has been restated to include ALC and
     American Sharecom.

                                       7
<PAGE>


  .  In 1995, Frontier paid $318.4 million in cash for several acquisitions
     that were accounted for as purchases. These purchase acquisitions were
     Minnesota Southern Cellular Telephone Company, ConferTech International,
     Inc., WCT Communications, Inc., Enhanced Telemanagement, Schneider
     Communications, Inc. and Schneider Communications' 80.8 percent interest
     in LinkUSA Corporation and Link-VTC, Inc. In February 1996, Frontier
     acquired the remaining 19.2 percent interest in LinkUSA Corporation for
     $2.3 million in cash, and in June 1996 made a payment of $4.3 million to
     Link-VTC, Inc. in settlement of the original earnout agreement.

   The following extraordinary, unusual or infrequently occurring items have
impacted net income for the periods presented:

  .  During the nine-month period ended September 30, 1999, Frontier recorded
     a $74.5 million charge for costs related to the merger with Global
     Crossing. These charges primarily include investment banker fees, legal
     fees, accelerated restricted stock compensation and other direct costs.

  .  In the first quarter of 1998, Frontier recorded a pre-tax charge of $6.5
     million associated with the acquisition of GlobalCenter. These charges
     included investment banker fees, legal fees and other direct costs.

  .  In October 1997, Frontier recorded a pre-tax charge of $86.8 million
     consisting of a restructuring charge of $43.0 million and a provision
     for asset and lease impairments of $43.8 million. The restructuring
     charge was primarily associated with a workforce reduction, program
     cancellations and discontinuing some product lines. The provision for
     asset and lease impairments primarily relates to long term assets and
     some lease obligations Frontier was in the process of disposing of or
     exiting.

  .  In March 1997, Frontier recorded a $96.6 million pre-tax charge
     primarily related to the write-off of certain leased network facilities
     no longer required as a result of the migration of Frontier's major
     carrier customer's one-plus traffic volume to other networks and
     Frontier's overall network integration efforts.

  .  In November 1996, Frontier recorded a $48.8 million pre-tax charge. This
     charge included $28.0 million for the curtailment of specified Frontier
     pension plans and a $20.8 million charge primarily to the write-off of
     unrecoverable product development costs for its conference calling
     product line.

  .  In December 1996, Frontier, through GlobalCenter, recorded a pre-tax
     charge of $18.9 million related to the write-off of in-process product
     development costs associated with the 1996 merger with GCIS, an Internet
     management services company.

  .  Frontier's 1995 operating results reflect pre-tax acquisition related
     charges of $114.2 million associated with the integration of a number of
     long distance companies acquired during the year, including the August
     1995 merger with ALC Communications.

  .  Frontier determined in 1995 that Statement of Financial Accounting
     Standards No. 71, "Accounting for the Effects of Certain Types of
     Regulation", was no longer applicable based upon changes in regulation,
     increasingly rapid advancements in telecommunications technology and
     other factors creating competitive markets. As a result of the
     discontinuance of FAS 71, Frontier recorded a non-cash extraordinary
     charge of $112.1 million, net of an income tax benefit of $68.4 million,
     as of September 30, 1995. Frontier also recorded a $9.0 million loss on
     the early extinguishment of debt in 1995.

                                       8
<PAGE>

                     Frontier Corporation and Subsidiaries
                  (in thousands, except per share information)

<TABLE>
<CAPTION>
                           Nine Months   Nine Months
                              Ended         Ended                    Year Ended December 31,
                          September 30, September 30, ----------------------------------------------------------
                              1999          1998         1998        1997        1996        1995        1994
                          ------------- ------------- ----------  ----------  ----------  ----------  ----------
                                  (unaudited)
<S>                       <C>           <C>           <C>         <C>         <C>         <C>         <C>
Consolidated Statements
 of Income:
Revenues................   $ 1,995,556   $1,938,522   $2,593,558  $2,374,809  $2,588,519  $2,150,328  $1,667,545
Costs and expenses......     1,835,514    1,708,518    2,276,162   2,288,651   2,220,296   1,865,492   1,341,919
                           -----------   ----------   ----------  ----------  ----------  ----------  ----------
Operating income........       160,042      230,004      317,396      86,158     368,223     284,836     325,626
Interest expense........       (48,739)     (39,516)     (55,318)    (48,239)    (43,312)    (53,572)    (50,216)
Other income, net of
 other expense..........        19,643       33,480       45,025      38,070      15,850      14,991      20,922
Income taxes............       (77,181)     (96,634)    (129,560)    (44,188)   (142,556)   (101,126)   (109,078)
                           -----------   ----------   ----------  ----------  ----------  ----------  ----------
Income before
 extraordinary items and
 cumulative effect of
 changes in accounting
 principles.............        53,765      127,334      177,543      31,801     198,205     145,129     187,254
Extraordinary items.....           --           --           --          --          --     (121,208)        --
Cumulative effect of
 changes in accounting
 principles.............           --        (1,755)      (1,755)        --       (8,018)     (1,477)     (7,197)
                           -----------   ----------   ----------  ----------  ----------  ----------  ----------
Consolidated net
 income.................        53,765      125,579      175,788      31,801     190,187      22,444     180,057
Dividends on preferred
 stock..................          (510)        (754)      (1,005)     (1,019)     (1,182)     (1,191)     (1,187)
                           -----------   ----------   ----------  ----------  ----------  ----------  ----------
Income applicable to
 common stock...........   $    53,255   $  124,825   $  174,783  $   30,782  $  189,005  $   21,253  $  178,870
                           ===========   ==========   ==========  ==========  ==========  ==========  ==========
Earnings per common
 share:
Income before
 extraordinary item and
 cumulative effect of
 changes in accounting
 principles
 Basic..................                              $     1.03  $      .18  $     1.19  $      .94  $     1.26
 Diluted................                                    1.02         .18        1.18         .88        1.16
Cash dividends declared
 per common share.......   $      .100   $     .668   $      .89  $     .875  $     .855  $     .835  $     .815
Consolidated Balance
 Sheets (at period end):
Current assets..........   $   644,023                $  566,674  $  490,305  $  477,761  $  524,200  $  673,826
Property, plant and
 equipment, net.........     2,189,138                 1,677,559   1,046,884     975,982     883,046   1,034,442
Goodwill and customer
 base, net..............     7,794,241                   484,015     517,754     538,296     550,081     222,442
Deferred and other
 assets.................       431,614                   330,495     432,977     237,353     154,088     130,084
                           -----------                ----------  ----------  ----------  ----------  ----------
 Total assets...........   $11,059,016                $3,058,743  $2,487,920  $2,229,392  $2,111,415  $2,060,794
                           ===========                ==========  ==========  ==========  ==========  ==========
Current liabilities.....   $   750,974                $  567,697  $  492,978  $  424,397  $  506,073  $  305,698
Long-term debt..........     1,800,651                 1,350,821     934,681     677,570     618,867     661,549
Other long-term
 liabilities............        31,928                       --          --          --          --          --
Deferred income taxes...           --                     40,046      10,927       2,542      15,644      98,217
Deferred employee
 benefits obligation....        89,596                    81,925      74,965      57,573      58,385      46,001
Shareholder's equity....     8,385,867                 1,018,254     974,369   1,067,310     912,446     949,329
                           -----------                ----------  ----------  ----------  ----------  ----------
 Total liabilities and
  shareholders' equity..   $11,059,016                $3,058,743  $2,487,920  $2,229,392  $2,111,415  $2,060,794
                           ===========                ==========  ==========  ==========  ==========  ==========
</TABLE>

                                       9
<PAGE>

Racal Telecom selected historical financial information

   The table below shows selected historical financial information for Racal
Telecom prepared in United States GAAP. This information has been prepared
using the combined financial statements of Racal Telecom as of the dates
indicated and for each of the fiscal years in the three-year period ended March
31, 1999. The combined income statement data below for each of the two years
ended March 31, 1999 and the combined balance sheet data at March 31, 1999 and
1998 were derived from financial statements audited by Deloitte & Touche,
independent auditors, which are incorporated by reference in this document. We
derived the remaining data from unaudited combined financial statements.

   The unaudited translations of Racal Telecom's sterling amounts into United
States dollars have been translated using convenience translation rates for the
fiscal year ended March 31, 1999. The convenience translations should not be
construed as representations that the sterling amounts have been, could have
been or could in the future be converted into United States dollars at this
rate or any other rate of exchange.

<TABLE>
<CAPTION>
                                         For the Years Ended March 31,
                          ------------------------------------------------------------
                                     1999                   1998            1997
                          ---------------------------  --------------- ---------------
                          (unaudited)
                                              (in thousands)
<S>                       <C>         <C>              <C>             <C>
Revenues................   $492,130   (Pounds)295,800  (Pounds)273,000 (Pounds)260,000
Income (loss) from
 continuing operations..    (30,450)          (18,300)          12,100          16,000
Total assets............    656,250           401,200          355,900         311,700
Long-term obligations...   $118,920   (Pounds) 72,700  (Pounds) 86,400 (Pounds)101,200
</TABLE>

HCL Holdings selected historical financial information

   The table below shows selected historical financial information for HCL
Holdings prepared in United States GAAP. This information has been prepared
using the combined financial statements of HCL Holdings as of the dates
indicated and for each of the years in the three-year period ended December 31,
1998 and for the nine months ended September 30, 1999 and 1998. The combined
financial information below as of and for each of the three years ended
December 31, 1998 were derived from financial statements audited by
PricewaterhouseCoopers, certified public accountants, which are incorporated by
reference in this document. The combined financial information below as of and
for the nine months ended September 30, 1999 and 1998 were derived from
unaudited combined financial statements.

<TABLE>
<CAPTION>
                          For the Nine   For the Nine
                          Months Ended   Months Ended    For the Years Ended December 31,
                          September 30,  September 30, --------------------------------------
                              1999           1998          1998          1997         1996
                          -------------  ------------- ------------  ------------  ----------
                                  (unaudited)
                                                   (in thousands)
<S>                       <C>            <C>           <C>           <C>           <C>
Revenues................  HK$  615,940    HK$ 735,933  HK$  950,120  HK$1,262,106  HK$790,995
Income (loss) from
 continuing operations..      (190,748)   HK$(177,318)     (279,526)     (356,847)   (153,626)
Total assets............     2,364,497                    1,857,539     1,369,610     705,687
Long-term obligations...  HK$3,022,594                 HK$2,306,024  HK$1,403,847  HK$704,586
</TABLE>

                                       10
<PAGE>


   The unaudited translations of HCL Holdings' Hong Kong dollar amounts into
United States dollars have been translated using convenience translation rates
for the fiscal year ended December 31, 1998 and for the nine months ended
September 30, 1999. The convenience translations should not be construed as
representations that the Hong Kong dollar amounts have been, could have been or
could in the future be converted into United States dollars at this rate or any
other rate of exchange.

<TABLE>
<CAPTION>
                                                     For the Nine  For the Year
                                                     Months Ended     Ended
                                                     September 30, December 31,
                                                         1999          1998
                                                     ------------- ------------
                                                            (unaudited)
                                                           (in thousands)
      <S>                                            <C>           <C>
      Revenues......................................   $ 79,429      $122,664
      Income (loss) from continuing operations......    (24,598)      (36,088)
      Total assets..................................    304,401       239,794
      Long-term obligations.........................   $389,123      $297,690
</TABLE>

                                       11
<PAGE>

                    Recent Financial Accounting Developments

   During the third and fourth quarters of 1999, changes in our business
activities, together with a newly effective accounting standard, caused us to
modify some of our practices regarding recognition of revenue and costs related
to sales of capacity. None of the accounting practices described below affect
our cash flows.

   As a result of Financial Accounting Standards Board (FASB) Interpretation
No. 43, "Real Estate Sales, an interpretation of FASB Statement No. 66" (FIN
43), which became effective July 1, 1999, we have accounted revenue from
terrestrial circuits sold after that date as operating leases and have
amortized that revenue over the terms of the related contracts. Previously, we
had recognized these sales as current revenue upon activation of the circuits.
This deferral in revenue recognition has no impact on cash flow.

   With the consummation of the Frontier acquisition on September 28, 1999,
service offerings became a significant source of our revenue. Consequently, we
initiated service contract accounting for our subsea systems during the fourth
quarter, because we, since that date, no longer hold subsea capacity
exclusively for sale. As a result, since the beginning of the fourth quarter,
we have depreciated investments in both subsea and terrestrial systems over
their remaining economic lives and have recognized revenue related to service
contracts over the terms of the contracts. We have recognized revenue and costs
related to the sale of subsea circuits upon activation, if the criteria of
sales-type lease accounting have been satisfied with respect to those circuits.

   During the fourth quarter, our global network service capabilities were
significantly expanded by the activation of several previously announced
systems and by the integration of other networks obtained through acquisition
and joint venture agreements. With this network expansion, we began offering
our customers flexible bandwidth products to multiple destinations, which makes
the historical practice of fixed, point-to-point routing of traffic and
restoration capacity both impractical and inefficient. To ensure the required
network flexibility, we will modify our future capacity purchase agreements and
our network management in a manner that precludes the use of sales-type lease
accounting.

   Because of these contract changes and the network management required to
meet customer demands for flexible bandwidth, multiple destinations and system
performance, we anticipate that most of the contracts for subsea circuits
entered into after January 1, 2000 will be part of a service offering and,
therefore, will not meet the criteria of sales-type lease accounting and will
be accounted for as operating leases. Consequently, we will defer revenue
related to those circuits and amortize it over the appropriate term of the
contract. In certain circumstances, if a contract meets all of the requirements
of sales-type lease accounting, we will recognize revenue without deferral upon
payment and activation.

   We note that accounting practice and authoritative guidance regarding the
applicability of sales-type lease accounting to the sale of capacity is still
evolving. Based on the accounting practices described above, we believe that
additional changes, if any, in accounting practice or authoritative guidance
affecting sales of capacity would have little or no impact on our results of
operations.

                                       12
<PAGE>

                              Global Crossing Ltd.
               Selected Unaudited Pro Forma Financial Information

   The following unaudited pro forma condensed combined financial information
of Global Crossing, Global Marine Systems, Frontier, Racal Telecom and the
Hutchison Global Crossing joint venture, which we refer to as "Pro Forma Global
Crossing Ltd.", has been prepared to demonstrate how these companies or
businesses might have looked if (1) the Global Marine Systems acquisition and
related financing, (2) the Frontier acquisition, (3) the Racal Telecom
acquisition and related financing, (4) the Hutchison Global Crossing joint
venture, including the related issuance of the 6 3/8% cumulative convertible
preferred stock, series B, of Global Crossing, (5) the offering of our 6 3/8%
cumulative convertible preferred stock completed on November 5, 1999, (6) the
offering of the 9 1/8% senior notes due 2006 and 9 1/2% senior notes due 2009
of Global Crossing Holdings completed on November 19, 1999 and (7) the offering
of our 7% cumulative convertible preferred stock completed on December 15, 1999
had been completed as of the date or at the beginning of the period presented.
This pro forma information does not give effect to (a) the $350 million cash
received in connection with the formation of the Asia Global Crossing joint
venture or (b) the IPC and IXnet mergers.

   We have prepared the pro forma financial information using the purchase
method of accounting. We expect that we will have reorganization and
restructuring expenses and potential synergies relating to the acquisitions of
Global Marine Systems and Racal Telecom, the Hutchison Global Crossing joint
venture and the acquisition of Frontier's long distance business and increased
opportunities to earn more revenue as a result of those transactions. The
unaudited pro forma information does not reflect these expenses and synergies.

   The pro forma information, while helpful in illustrating the financial
characteristics of the combined company under one set of assumptions, does not
attempt to predict or suggest future results. The pro forma information also
does not attempt to show how the combined company would actually have performed
had the companies been combined throughout these periods. If the companies had
actually been combined in prior periods, these companies and businesses might
have performed differently. You should not rely on pro forma financial
information as an indication of the results that would have been achieved if
the Global Marine Systems, Frontier and Racal Telecom acquisitions and the
Hutchison Global Crossing joint venture had taken place earlier or the future
results that the companies will experience after completion of these
transactions.

   You should read these unaudited pro forma condensed combined financial
statements in conjunction with the historical financial statements of Global
Crossing, Global Marine Systems, Frontier, Racal Telecom and HCL Holdings,
which are incorporated by reference in this document.


                                       13
<PAGE>

                         Pro Forma Global Crossing Ltd.
              Unaudited Pro Forma Condensed Combined Balance Sheet
                            as of December 31, 1999
                                 (in thousands)
<TABLE>
<CAPTION>
                                         Global        Hutchison      Global
                                        Crossing    Global Crossing  Crossing
                                      Historical(1) Adjustments(2)   Pro Forma
                                      ------------- --------------- -----------
<S>                                   <C>           <C>             <C>
ASSETS
Current Assets:
 Cash, restricted cash and
  investments.......................   $ 1,726,793     $(50,000)    $ 1,676,793
 Accounts receivable, net...........       966,973          --          966,973
 Other assets and prepaid costs.....       252,767          --          252,767
                                       -----------     --------     -----------
   Total Current Assets.............     2,946,533      (50,000)      2,896,533
Restricted cash and cash
 equivalents........................       138,118          --          138,118
Accounts receivable.................        52,052          --           52,052
Property and equipment, net.........     6,026,053      (83,800)      5,942,253
Goodwill and other intangibles,
 net................................     9,557,422          --        9,557,422
Investment in and advances to/from
 affiliates, net....................       323,960      538,800         862,760
Other assets, net...................       661,442          --          661,442
                                       -----------     --------     -----------
   Total Assets.....................   $19,705,580     $405,000     $20,110,580
                                       ===========     ========     ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
 Accrued construction costs.........   $   275,361     $    --      $   275,361
 Accounts payable and accrued
  liabilities.......................       944,780        5,000         949,780
 Accrued interest and preferred
  dividends.........................        66,745          --           66,745
 Deferred revenue...................       127,367          --          127,367
 Income taxes payable...............       140,034          --          140,034
 Current portion of long term
  debt..............................         5,496          --            5,496
 Other current liabilities..........       292,810          --          292,810
                                       -----------     --------     -----------
   Total Current Liabilities........     1,852,593        5,000       1,857,593
 Long term debt.....................     5,018,544          --        5,018,544
 Deferred revenue...................       383,287          --          383,287
 Deferred credits and other.........       796,606          --          796,606
                                       -----------     --------     -----------
   Total Liabilities................     8,051,030        5,000       8,056,030
                                       -----------     --------     -----------
MINORITY INTEREST...................       351,338          --          351,338
                                       -----------     --------     -----------
MANDATORILY REDEEMABLE AND
 CUMULATIVE CONVERTIBLE PREFERRED
 STOCK:
 10 1/2% Mandatorily Redeemable
  Preferred Stock, 5,000,000 shares
  issued and outstanding as of
  December 31, 1999, $100
  liquidation preference per
  share.............................       485,947          --          485,947
                                       -----------     --------     -----------
 6 3/8% Cumulative Convertible
  Preferred Stock, 10,000,000
  shares issued and outstanding as
  of December 31, 1999, $100
  liquidation preference per
  share.............................       969,000      400,000       1,369,000
                                       -----------     --------     -----------
 7% Cumulative Convertible
  Preferred Stock, 2,600,000 and no
  shares issued and outstanding as
  of December 31, 1999, $250
  liquidation preference per
  share.............................       629,750          --          629,750
                                       -----------     --------     -----------
SHAREHOLDERS' EQUITY:
 Common stock, 3,000,000,000 shares
  authorized, par value $.01,
  799,137,142 issued as of December
  31, 1999..........................         7,992          --            7,992
 Treasury stock, 22,033,758
  shares............................      (209,415)         --         (209,415)
 Other shareholders' equity.........     9,578,927          --        9,578,927
 Accumulated deficit................      (158,989)         --         (158,989)
                                       -----------     --------     -----------
                                         9,218,515          --        9,218,515
                                       -----------     --------     -----------
   Total Liabilities and
    Shareholder's Equity............   $19,705,580     $405,000     $20,110,580
                                       ===========     ========     ===========
</TABLE>

                                       14
<PAGE>

                        Pro Forma Global Crossing Ltd.
        Unaudited Pro Forma Condensed Combined Statements of Operations

                     For the Year Ended December 31, 1999
              (in thousands, except share and per share amounts)

<TABLE>
<CAPTION>
                                       Global     Global
                          Global       Marine     Marine                                                     Racal
                         Crossing     Systems     Systems       Frontier    Frontier       Racal Telecom    Telecom
                       Historical(3) Historical Adjustments    Historical  Adjustments     Historical(13)  Adjustments
                       ------------- ---------- -----------    ----------  -----------     -------------  ------------
<S>                    <C>           <C>        <C>            <C>         <C>             <C>            <C>
Operating
Revenues...........     $ 1,664,824   $173,498   $    --       $1,995,556   $     --         $306,019      $     --
                        -----------   --------   --------      ----------   ---------        --------      ---------
Operating Expenses:
 Operating,
 selling, general
 and
 administrative....       1,369,064    127,165        --        1,551,234         --          286,442            --
 Stock-related
 expense...........          51,306        --         --           10,412     (10,412)(9)         --             --
 Merger Expenses...             --         --         --           74,519         --           24,600            --
 Depreciation and
 amortization......         124,294     12,817        --          173,600         --           52,716            --
 Goodwill and
 intangibles
 amortization......         127,621        812       (812)(5)      25,749     (25,749)(10)        --          55,843 (14)
                                                   19,690 (5)                 303,774 (10)
                        -----------   --------   --------      ----------   ---------        --------      ---------
                          1,672,285    140,794     18,878       1,835,514     267,613         363,758         55,843
                        -----------   --------   --------      ----------   ---------        --------      ---------
Operating income
(loss).............          (7,461)    32,704    (18,878)        160,042    (267,613)        (57,739)       (55,843)
Equity in income
(loss) of
affiliates.........          15,708      4,539        --           17,235         --             (560)           --
Minority interest..          (1,338)       --         --              --          --              --             --
Other income
(expense):
 Interest
 expense...........        (139,077)    (6,869)   (24,000)(6)     (48,739)        --          (30,908)       (96,363)(15)
 Interest income...          67,407        511        --            4,754         --            3,856            --
 Other income
 (expenses)........         180,765        143        --           (2,346)        --              369            --
                        -----------   --------   --------      ----------   ---------        --------      ---------
Income (loss)
before provision
for income taxes,
extraordinary item
and cumulative
effect of change in
accounting
principle..........         116,004     31,028    (42,878)        130,946    (267,613)        (84,982)      (152,206)
 (Provision)
 benefit for
 income taxes......        (126,539)   (11,885)     7,200 (7)     (77,181)        --           30,116         23,115 (16)
                        -----------   --------   --------      ----------   ---------        --------      ---------
Income (loss)
before
extraordinary item
and cumulative
effect of change in
accounting
principle..........         (10,535)    19,143    (35,678)         53,765    (267,613)        (54,866)      (129,091)
 Preferred stock
 dividends.........         (66,642)       --         --             (510)        510 (11)        --             --
                        -----------   --------   --------      ----------   ---------        --------      ---------
Income (loss)
applicable to
common shareholders
before
extraordinary item
and cumulative
effect of change in
accounting
principle..........         (77,177)    19,143    (35,678)         53,255    (267,103)        (54,866)      (129,091)
 Diluted earnings
 adjustment........             --         --         --              270        (270)(12)        --             --
                        -----------   --------   --------      ----------   ---------        --------      ---------
Income (loss)
applicable to
common shareholders
before
extrarodinary item
and cumulative
effect of change in
accounting
principle
(Diluted)..........     $   (77,177)  $ 19,143   $(35,678)     $   53,525   $(267,373)       $(54,866)     $(129,091)
                        ===========   ========   ========      ==========   =========        ========      =========
Income (loss) per
common share:
 Income (loss)
 applicable to
 common
 shareholders
 before
 extraordinary
 item and
 cumulative effect
 of change in
 accounting principle
   Basic and
   diluted.........     $     (0.15)
                        ===========
 Shares used in
 computing
 information
 applicable to
 common
 shareholders
   Basic and
   diluted.........     502,400,851
                        ===========
<CAPTION>
                         Hutchison
                           Global                       Global
                          Crossing       Financing     Crossing
                       Adjustments(2) Adjustments(17)  Pro Forma
                       -------------- --------------- ----------------
<S>                    <C>            <C>             <C>
Operating
Revenues...........       $    --        $     --     $ 4,139,897
                       -------------- --------------- ----------------
Operating Expenses:
 Operating,
 selling, general
 and
 administrative....            --              --       3,333,905
 Stock-related
 expense...........            --              --          51,306
 Merger Expenses...            --              --          99,119
 Depreciation and
 amortization......            --              --         363,427
 Goodwill and
 intangibles
 amortization......            --              --         506,928
                       -------------- --------------- ----------------
                               --              --       4,354,685
                       -------------- --------------- ----------------
Operating income
(loss).............            --              --        (214,788)
Equity in income
(loss) of
affiliates.........        (15,825)            --            (143)
                           (21,240)            --
Minority interest..                            --          (1,338)
Other income
(expense):
 Interest
 expense...........            --           93,577       (495,695)
                                          (243,316)
 Interest income...            --              --          76,528
 Other income
 (expenses)........            --              --         178,931
                       -------------- --------------- ----------------
Income (loss)
before provision
for income taxes,
extraordinary item
and cumulative
effect of change in
accounting
principle..........        (37,065)       (149,739)      (456,505)
 (Provision)
 benefit for
 income taxes......            --           (7,200)      (162,374)
                       -------------- --------------- ----------------
Income (loss)
before
extraordinary item
and cumulative
effect of change in
accounting
principle..........        (37,065)       (156,939)      (618,879)
 Preferred stock
 dividends.........        (25,529)       (108,936)      (201,107)
                       -------------- --------------- ----------------
Income (loss)
applicable to
common shareholders
before
extraordinary item
and cumulative
effect of change in
accounting
principle..........        (62,594)       (265,875)      (819,986)
 Diluted earnings
 adjustment........            --              --
                       -------------- --------------- ----------------
Income (loss)
applicable to
common shareholders
before
extrarodinary item
and cumulative
effect of change in
accounting
principle
(Diluted)..........       $(62,594)      $(265,875)   $  (819,986)
                       ============== =============== ================
Income (loss) per
common share:
 Income (loss)
 applicable to
 common
 shareholders
 before
 extraordinary
 item and
 cumulative effect
 of change in
 accounting principle
   Basic and
   diluted.........                                   $     (1.07)
                                                      ================
 Shares used in
 computing
 information
 applicable to
 common
 shareholders
   Basic and
   diluted.........                                   767,355,151 (18)
                                                      ================
</TABLE>

                                       15
<PAGE>

                        Pro Forma Global Crossing Ltd.

           Notes to Unaudited Pro Forma Condensed Combined Financial
                                  Statements

 (1) This column represents the historical financial position of Global
     Crossing as of December 31, 1999, including the assets acquired in the
     Frontier merger and the Global Marine Systems and Racal Telecom
     acquisitions.

 (2) On January 12, 2000, we and Hutchison Whampoa Limited formed a joint
     venture called Hutchison Global Crossing. This joint venture is owned in
     equal parts by us and Hutchison Whampoa. In exchange for its 50%
     interest, Hutchison Whampoa contributed to the joint venture its existing
     building-to-building fixed-line telecommunications network in Hong Kong
     and certain Internet-related assets previously held by Hutchison
     Telecommunications Limited. In exchange for our 50% interest, we
     contributed to the joint venture international telecommunications
     capacity rights on our network and know-how related to Internet data
     centers valued at $350 million and $50 million in cash. In addition, we
     issued to Hutchison Whampoa $400 million aggregate liquidation preference
     of our 6 3/8% cumulative convertible preferred stock, series B,
     convertible into our common stock. The Hutchison Global Crossing joint
     venture is anticipated to be accounted for as an unconsolidated joint
     venture under the equity method of accounting.

<TABLE>
   <S>                                                     <C>        <C>
   Total Consideration
     Cash contributed...................................              $ 50,000
     6 3/8% Cumulative Convertible Preferred Stock,
      Series B..........................................               400,000
     Estimated cost of capacity contributed.............                83,800
     Global Crossing transaction costs..................                 5,000
                                                                      --------
   Total consideration..................................               538,800
   Less:Historical net tangible book value of HCL
    Holdings:
     Historical HCL Holdings net liabilities at December
     31, 1999...........................................   $(149,393)
     Cash contributed...................................      50,000
     Estimated cost of capacity contributed.............      83,800
                                                           ---------
     Adjusted net tangible book value...................     (15,593)
     50% ownership interest.............................       7,797
                                                           ---------
                                                                        (7,796)
                                                                      --------
   Total Goodwill.......................................              $546,596
                                                                      ========
</TABLE>

   We have tentatively considered the carrying value of the acquired assets to
   approximate their fair value, with all of the excess of those acquisition
   costs being attributable to goodwill. We are in the process of fully
   evaluating the assets to be acquired and, as a result, the purchase price
   allocation among the tangible and intangible assets acquired and their
   useful lives may change. We currently anticipate that goodwill associated
   with the merger will be amortized over a 25-year life.

   These adjustments also include the assumed equity in the results of
   operations of Hutchison Global Crossing for the year ended December 31,
   1999.

 (3) This column represents the historical results of operations for the year
     ended December 31, 1999 including the results of Global Marine Systems
     operations for the six months ended December 31, 1999, the results of
     Frontier operations for the three months ended December 31, 1999 and
     Racal Telecom for the period from November 24, 1999 to December 31, 1999.

 (4) This column represents the historical results of operations of Global
     Marine Systems for the six months ended June 30, 1999.

                                      16
<PAGE>


 (5) These adjustments reflect the amortization expense of the excess
     consideration over the net assets acquired (goodwill), which we have
     estimated to be approximately $693 million. We are amortizing goodwill and
     other intangible assets on the straight-line method over 3-25 years. The
     initial purchase price allocation is based on current estimates. We will
     make the final purchase price allocation based upon final values for
     certain assets and liabilities. As a result, the final purchase price
     allocation may differ from the presented estimate.

 (6) This amount reflects the assumed interest expense, at an 8% interest rate,
     incurred on the $600 million debt assumed issued as of the earliest date
     presented in connection with the acquisition of Global Marine Systems.

 (7) This adjustment represents the tax benefit resulting from the interest
     expense assumed in connection with the debt issued for the acquisition of
     Global Marine Systems.

 (8) This column represents Frontier's historical results of operations for the
     nine months ended September 30, 1999.

 (9) This adjustment assumes Frontier's stock related expenses would not have
     been incurred had the merger occurred at the earliest date presented.

(10) These adjustments reflect the amortization expense of the excess
     consideration over the net assets acquired (goodwill), which we have
     estimated to be approximately $7.7 billion. We are amortizing goodwill and
     other intangible assets on a straight-line method over 6-25 years. The
     initial purchase price allocation is based on current estimates. We will
     make the final purchase price allocation based upon final values for
     certain assets and liabilities. As a result, the final purchase price
     allocation may differ from the presented estimate.

(11) This adjustment assumes that Frontier's preferred stock dividends would
     not have been incurred, as Frontier's preferred stock would have been
     redeemed as of the earliest date presented.

(12) To eliminate diluted earnings adjustment due to the combined net loss
     position.

(13) This column represents Racal Telecom's results from operations in United
     States GAAP, the disposal of the Racal Translink and Racal Fieldforce
     divisions of Racal Telecommunications Limited which we did not acquire and
     pro forma adjustments to reflect the likely effect of the trading among
     Racal Translink, Racal Fieldforce and Racal Telecom based on contractual
     obligations among the divisions. We summarize these adjustments in the
     table below:

                                       17
<PAGE>


                            Racal Telecom Pro Forma
        Unaudited Pro Forma Condensed Combined Statements of Operations

            For the period from January 1, 1999 to November 23, 1999
                                 (in thousands)
<TABLE>
<CAPTION>
                                                              US GAAP and     Racal
                                            BV Acquisition     Accounting    Telecom    Racal
                                            and Carve-Out        Policy      Interim   Telecom
                              Historical(a)  Adjustments     Adjustments(d) Period(e) Pro Forma
                              ------------  --------------   -------------- --------- ---------
   <S>                        <C>           <C>              <C>            <C>       <C>
   Operating Revenues......     $390,578      $(110,354)(c)     $(22,447)    $47,937  $306,019
                                                    305 (b)
                                --------      ---------         --------     -------  --------
   Operating Expenses:
    Operating, selling,
     general and
     administrative........      355,110        (99,595)(c)        1,737      53,544   311,042
                                                    246 (b)
    Depreciation and
     amortization..........       61,774        (11,978)(c)       (3,340)      6,265    52,716
                                                     (5)(b)
                                --------      ---------         --------     -------  --------
                                 416,884       (111,332)          (1,603)     59,809   363,758
                                --------      ---------         --------     -------  --------
   Operating income
    (loss).................      (26,306)         1,283          (20,844)    (11,872)  (57,739)
   Equity in income (loss)
    of affiliates..........         (560)           --               --                   (560)
   Other income (expense):
    Interest expense.......      (30,905)            (3)(b)          --          --    (30,908)
    Interest income........          --           3,089 (c)          --          767     3,856
    Other income
     (expense).............       76,390        (76,021)(c)          --          --        369
                                --------      ---------         --------     -------  --------
   Income (loss) before
    extraordinary item,
    taxes and cumulative
    effect of changes in
    accounting principle...       18,619        (71,652)         (20,844)    (11,105)  (84,982)
    (Provision) benefit for
     income taxes..........        3,563            (70)(b)       18,918       7,705    30,116
                                --------      ---------         --------     -------  --------
   Income (loss) before
    extraordinary item and
    cumulative effect of
    changes in accounting
    principle..............     $ 22,182      $ (71,722)        $ (1,926)    $(3,400) $(54,866)
                                ========      =========         ========     =======  ========
</TABLE>

  (a)  This column represents the combined historical results of operations
       of Racal Telecommunications Limited, Racal Telecommunications Networks
       Limited, Racal Internet Services Limited and Racal Telecommunications
       Inc., which we refer to as "Racal Telecom", in accordance with United
       Kingdom GAAP translated into United States dollars for the 41 weeks
       ended October 15, 1999.

  (b)  We are treated as having acquired the business and assets of Racal
       Network Services BV as that company was in the process of being
       reorganized into Racal Telecommunications Networks Limited in the
       course of 1999. These adjustments reflect the financial position and
       results of operations of Racal Network Services BV as if this
       transaction had been completed as of the dates or at the beginning of
       the periods presented.

  (c)  In July 1999, the Racal Telecom business was separated into three
       divisions: Racal Telecom, Racal Translink and Racal Fieldforce. On
       October 1, 1999, the Racal Translink and Racal Fieldforce businesses
       were sold to another company within the Racal Electronics plc group.
       This adjustment eliminates the results of operations of Racal
       Translink and Racal Fieldforce, reflects the likely effect of the
       trading among Racal Translink, Racal Fieldforce and Racal Telecom
       based on contractual obligations among the divisions and adjusts the
       profit on disposal of these operations. No taxation liabilities were
       incurred on the disposal as this disposal was to another Racal
       Electronics plc group company.

  (d)  The Racal Telecom combined financial statements are prepared in
       accordance with United Kingdom GAAP which differ in certain material
       respects from United States GAAP. The differences that are material
       are disclosed in the notes to the combined financial statements,
       incorporated by reference. In addition, an adjustment has been made to
       treat sales of dark fiber made by Racal Telecom after July 1, 1999 as
       operating leases, recognizing income over the period of the service
       provision in accordance with the provision of FASB Interpretation No
       43.

  (e)  This column represents Racal Telecom's historical results from October
       16, 1999 to November 23, 1999.

                                       18
<PAGE>


(14) This adjustment reflects the amortization expense of the excess
     consideration over the net assets acquired (goodwill), which we have
     preliminarily estimated to be $1.6 billion. We have tentatively considered
     the carrying value of the acquired assets to approximate fair value, with
     all excess of those acquisition costs being attributable to goodwill. We
     are in the process of fully evaluating the assets to be acquired and, as a
     result, the purchase price allocation among the tangible and intangible
     assets acquired, and their related useful lives, may change. We currently
     anticipate that goodwill associated with the transaction will be amortized
     over a 25-year life.

(15) This amount reflects the assumed interest expense, at a 9% interest rate,
     including the amortization of deferred financing fees incurred on the $1.1
     billion debt assumed issued as of the earliest date presented in
     connection with the acquisition of Racal Telecom.

(16) This adjustment represents the tax benefit resulting from the interest
     expense assumed in connection with the debt issued for the acquisition of
     Racal Telecom.

(17) These adjustments represent the assumed interest expenses, including
     amortization of deferred financing fees, in connection with the issuance
     and assumed repayment of existing debt related to the 9 1/8% senior notes
     due 2006 and 9 1/2% senior notes due 2009 of Global Crossing Holdings, our
     6 3/8% cumulative convertible preferred stock and our 7% cumulative
     convertible preferred stock, including the over-allotment. In connection
     with the issuance of the 9 1/8% senior notes due 2006 and 9 1/2% senior
     notes due 2009 of Global Crossing Holdings, we incurred approximately
     $29.7 million in financing fees. The financing fees will be amortized over
     the life of the debt.

(18) Pro forma per share data are based on the number of our common shares that
     would have been outstanding had the merger occurred at the earliest date
     presented. We issued 355,181,000 shares in connection with the Frontier
     merger.

                                       19
<PAGE>

                                  RISK FACTORS

   Before investing in our securities, you should carefully consider the risks
described below and in any accompanying prospectus supplement as well as the
other information included or incorporated by reference in this prospectus.

Risk Factors Relating to Our Business

We cannot assure you of the successful integration of newly acquired
businesses. We cannot assure you that the expected benefits will be achieved.

   Part of our growth strategy is to make selective strategic acquisitions of
businesses operated by others. Achieving the benefits of these acquisitions
will depend in part on the integration of those businesses with our business in
an efficient manner. We cannot assure you that this will happen or that it will
happen in a timely manner. The consolidation of operations following these
acquisitions will often require substantial attention from management. The
diversion of management attention and any difficulties encountered in the
transition and integration process could have a material adverse effect on the
revenue, levels of expenses and operating results of the combined company. We
cannot assure you that the combined company will realize any of the anticipated
benefits of any acquisition.

It may be difficult to evaluate our business because we have a limited
operating history.

   We were organized in March 1997 and, with the exception of our Frontier,
Global Marine Systems and Racal Telecom subsidiaries, have a limited operating
history. Because of this limited history and our rapid growth through
successive acquisitions, it may be difficult for potential investors to
evaluate the performance of our operations. In particular, comparisons of our
results of operations from one period to another may not be fully indicative of
our current ability to conduct our business.

We may encounter difficulties in completing our cable systems currently under
development.

   Our ability to achieve our strategic objectives will depend in large part
upon the successful, timely and cost-effective completion of our cable systems
currently under development, as well as on achieving substantial capacity sales
on these systems once they become operational and on our other operational
systems. The construction of these systems will be affected by a variety of
factors, uncertainties and contingencies, many of which are beyond our control,
including:

  .  our ability to manage their construction effectively;

  .  our ability to obtain all construction and operating permits and
     licenses;

  .  third-party contractors performing their obligations on schedule; and

  .  our ability to enter into favorable construction contracts with a
     limited number of suppliers.

   These factors may significantly delay or prevent completion of one or more
of our systems currently under development, which could have a material adverse
effect on our business, financial condition and results of operations.

   We cannot assure you that each of these systems will be completed at the
cost and in the time frame currently estimated by us, or even at all. Although
we award contracts for construction of our systems to suppliers who in most
cases are expected to be bound by a fixed-price construction cost schedule and
to provide guarantees in respect of completion dates and system design
specifications, we cannot assure you that the actual construction costs or the
time required to complete these systems will not exceed our current estimates.
These circumstances could have a material adverse effect on our business,
financial condition and results of operations.

                                       20
<PAGE>

Our revenue growth plan depends on product and service expansion.

   We intend to grow revenue and profits by:

  .  introducing new services and products;

  .  developing or acquiring additional cable systems; and

  .  upgrading capacity on our planned systems.

   Our inability to effect these expansions of our products and services could
have a material adverse effect on our business, financial condition and results
of operations.

We face competition which may reduce demand for our products and services.

   The international telecommunications industry is highly competitive. We
compete primarily on the basis of price, availability, service quality and
reliability, customer service and the location of our systems and services. The
ability of our competitors to provide comparable products and services at
similar prices could have a material adverse effect on demand for our products
and services. In addition, much of our planned growth is predicated upon the
growth in demand for international telecommunications capacity and services. We
cannot assure you that this anticipated demand growth will occur.

We are growing rapidly in a changing industry.

   Our strategy is to be the premier provider of global broadband
telecommunication services for both wholesale and retail customers. As a result
of this aggressive strategy, we are experiencing rapid expansion and expect it
to continue for the foreseeable future. This growth has increased our operating
complexity. At the same time, the international telecommunications industry is
changing rapidly due to, among other things:

  .  the easing of regulatory constraints;

  .  the privatization of established carriers;

  .  the expansion of telecommunications infrastructure;

  .  the growth in demand for bandwidth caused by expansion of Internet and
     data transmissions;

  .  the globalization of the world's economies; and

  .  the changing technology for wired, wireless and satellite communication.

   We cannot assure you that we will succeed in adapting to the rapid changes
in the international telecommunications industry.

We may have difficulty in obtaining the additional financing required to
develop our business.

   In order to further implement our aggressive growth strategy, we anticipate
that we will require substantial additional equity and debt financing. Under
our business plan, we and our affiliates expect to require significant
financing by the end of 2000 to build out the Global Crossing network and
provide additional services to our customers. Obtaining additional financing
will be subject to a number of factors, including:

  .  the state of operations of our company;

  .  our actual or anticipated results of operations, financial condition and
     cash flows;

  .  investor sentiment towards companies with substantial international
     operations; and

  .  generally prevailing market conditions.

                                       21
<PAGE>

   If additional funds are raised through the issuance of equity securities,
the percentage ownership of our then current shareholders will be reduced, and
the new equity securities may have rights, preferences or privileges senior to
those of the holders of our common stock. If additional funds are raised
through the issuance of debt securities, these securities would have some
rights, preferences and privileges senior to those of the holders of our common
stock, and the terms of this debt could impose restrictions on our operations
and result in significant interest expense to us. In the event that we are
unable to raise sufficient financing on satisfactory terms and conditions in
the future, our company would be adversely affected.

We face price declines that could adversely affect our business.

   Advances in fiber optic technology have resulted in significant per circuit
price declines in the fiber optic cable transmission industry. Recent changes
in technology caused prices for telecommunications capacity and services to go
down even further. If there is less demand than we project or a bigger drop in
prices than we project, there could be a material adverse effect on our
business, financial condition and results of operations. We cannot assure you,
even if our projections with respect to those factors are realized, that we
will be able to implement our strategy or that our strategy will be successful
in the rapidly evolving telecommunications market.

We confront several system risks that could affect our operations.

   Each of our systems is and will be subject to the risks inherent in a large-
scale, complex fiber optic telecommunications system. The operation,
administration, maintenance and repair of our systems requires the coordination
and integration of sophisticated and highly specialized hardware and software
technologies and equipment located throughout the world. We cannot assure you
that our systems will continue to function as expected in a cost-effective
manner. The failure of the hardware or software to function as required could
render a cable system unable to perform at design specifications.

   Each of our undersea systems either has or is expected to have a design life
of generally 25 years, while each of our terrestrial systems either has or is
expected to have a design life of at least 20 years. The economic lives of
these systems, however, are expected to be shorter than their design lives, and
we cannot assure you of the actual useful life of any of these systems. A
number of factors will ultimately affect the useful life of each of our
systems, including:

  .  quality of construction;

  .  unexpected damage or deterioration; and

  .  technological or economic obsolescence.

   Failure of any of our systems to operate for its full design life could have
a material adverse effect on our business, financial condition and results of
operations.

Our success depends on our ability to maintain, hire and successfully integrate
key personnel.

   Our future success depends on the skills, experience and efforts of our
officers and key technical and sales employees. In particular, our senior
management has significant experience in the telecommunications and Internet
industries, and the loss of any of them could negatively affect our ability to
execute our business strategy. In addition, we cannot assure you that we will
be able to integrate new management into our existing operations. Competition
for these individuals is intense, and we may not be able to attract, motivate
and retain highly skilled qualified personnel. We do not have "key person" life
insurance policies covering any of our employees.

                                       22
<PAGE>

We face risks associated with international operations.

   Because we will derive substantial revenue from international operations and
intend to have substantial physical assets in several jurisdictions along our
routes, our business is subject to risks inherent in international operations,
including:

  .  political and economic conditions;

  .  unexpected changes in regulatory environments;

  .  exposure to different legal standards; and

  .  difficulties in staffing and managing operations.

   We have not experienced any material adverse effects with respect to our
foreign operations arising from these factors. However, problems associated
with these risks could arise in the future. Finally, managing operations in
multiple jurisdictions may place further strain on our ability to manage our
overall growth.

Because many of our customers deal predominantly in foreign currencies, we may
be exposed to exchange rate risks and our net income may suffer due to currency
translations.

   We primarily invoice for our services in United States dollars; however,
most of our customers and many of our prospective customers derive their
revenue in currencies other than United States dollars. The obligations of
customers with substantial revenue in foreign currencies may be subject to
unpredictable and indeterminate increases in the event that such currencies
devalue relative to the United States dollar. Furthermore, such customers may
become subject to exchange control regulations restricting the conversion of
their revenue currencies into United States dollars. In such event, the
affected customers may not be able to pay us in United States dollars. In
addition, where we invoice for our services in currencies other than United
States dollars, our net income may suffer due to currency translations in the
event that such currencies devalue relative to the United States dollar and we
do not elect to enter into currency hedging arrangements in respect of those
payment obligations.

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. If we fail to comply with those regulatory requirements or obtain and
maintain those licenses and permits, we may not be able to conduct our
business.

   In the United States, our intrastate, interstate, and international
telecommunications networks and services are subject to regulation at the
federal, state, and local levels. We also have facilities and provide services
in numerous countries in Europe, Latin America, and Asia. Our operations in
those countries are subject to regulation at the national level and, in some
cases, at the state, provincial, and local levels.

  .  Our interstate and international operations in the United States are
     governed by the Communications Act of 1934, as amended by the
     Telecommunications Act of 1996. There are several ongoing proceedings at
     the FCC and in the federal courts regarding the implementation of
     various aspects of the Telecommunications Act. The outcomes of these
     proceedings may affect the manner in which we are permitted to provide
     our services in the United States and may have a material adverse effect
     on our operations.

  .  The intrastate activities of our local telephone service companies are
     regulated by the states in which they do business. A number of states in
     which we operate are conducting proceedings related to the provision of
     services in a competitive telecommunications environment. These
     proceedings may affect the manner in which we are permitted to provide
     our services in one or more states and may have a material adverse
     effect on our operations.

                                       23
<PAGE>

  .  Our operations outside the United States are governed by the laws of the
     countries in which we operate. The regulation of telecommunications
     networks and services outside the United States varies widely. In some
     countries, the range of services that we are legally permitted to
     provide may be limited. In other countries, existing telecommunications
     legislation is in the process of development, is unclear or
     inconsistent, or is applied in an unequal or discriminatory fashion. Our
     inability or failure to comply with the telecommunications laws and
     regulations of one or more of the countries in which we operate could
     result in the temporary or permanent suspension of operations in one or
     more countries. We also may be prohibited from entering certain
     countries at all or from providing all of our services in one or more
     countries. In addition, many of the countries in which we operate are
     conducting proceedings that will affect the implementation of their
     telecommunications legislation. We cannot be certain of the outcome of
     these proceedings. These proceedings may affect the manner in which we
     are permitted to provide our services in these countries and may have a
     material adverse effect on our operations.

  .  In the ordinary course of constructing our networks and providing our
     services we are required to obtain and maintain a variety of
     telecommunications and other licenses and authorizations in the
     countries in which we operate. We also must comply with a variety of
     regulatory obligations. Our failure to obtain or maintain necessary
     licenses and authorizations, or to comply with the obligations imposed
     upon license-holders in one or more countries, may result in sanctions,
     including the revocation of authority to provide services in one or more
     countries.

We depend on third parties for many functions. If the services of those third
parties are not available to us, we may not be able to conduct our business.

   We depend and will continue to depend upon third parties to:

  .  construct some of our systems and provide equipment and maintenance;

  .  provide access to a number of origination and termination points of our
     systems in various jurisdictions;

  .  construct and operate landing stations in a number of those
     jurisdictions;

  .  acquire rights of way;

  .  provide terrestrial capacity to our customers through contractual
     arrangements; and

  .  act as joint venture participants with regard to some of our current and
     potential future systems.

   We cannot assure you that third parties will perform their contractual
obligations or that they will not be subject to political or economic events
which may have a material adverse effect on our business, financial condition
and results of operations. If they fail to perform their obligations, we may
not be able to conduct our business. If any of our joint venture participants
experiences a change in strategic direction such that their strategy regarding
our mutual joint venture diverges from our own, we may not be able to realize
the benefits anticipated to be derived from the joint venture.

We have substantial leverage which may limit our ability to comply with the
terms of our indebtedness and may restrict our ability to operate.

   Our significant indebtedness could adversely affect us by leaving us with
insufficient cash to fund operations and impairing our ability to obtain
additional financing. The amount of our debt could have important consequences
for our future, including, among other things:

  .  cash from operations may be insufficient to meet the principal and
     interest on our indebtedness as it becomes due;

  .  payments of principal and interest on borrowings may leave us with
     insufficient cash resources for our operations; and

  .  restrictive debt covenants may impair our ability to obtain additional
     financing.

                                      24
<PAGE>

   We have incurred a high level of debt. As of December 31, 1999, we and our
consolidated subsidiaries had a total of $8,051 million of total liabilities,
including approximately $5,056 million in senior indebtedness, of which $1,295
million was secured. As of that date, we additionally had outstanding
cumulative convertible preferred stock with a face value of $1,650 million. Our
subsidiary, Global Crossing Holdings, also has mandatorily redeemable preferred
stock outstanding with a face value of $500 million. In addition, our Pacific
Crossing joint venture entered into an $850 million non-recourse credit
facility, under which it had incurred $750 million of indebtedness as of
December 31, 1999.

   Our ability to repay our debt depends upon a number of factors, many of
which are beyond our control. In addition, we rely on dividends, loan
repayments and other intercompany cash flows from our subsidiaries to repay our
obligations. Our operating subsidiaries have entered into a senior secured
corporate credit facility. Accordingly, the payment of dividends from these
operating subsidiaries and the making and repayments of loans and advances are
subject to statutory, contractual and other restrictions.

   In addition, if we are unable to generate sufficient cash flow to meet our
debt service requirements, we may have to renegotiate the terms of our long-
term debt. We cannot assure you that we would be able to renegotiate
successfully those terms or refinance our indebtedness when required or that
satisfactory terms of any refinancing would be available. If we were not able
to refinance our indebtedness or obtain new financing under these
circumstances, we would have to consider other options, such as:

  .  sales of some assets;

  .  sales of equity;

  .  negotiations with our lenders to restructure applicable indebtedness; or

  .  other options available to us under applicable law.

Our principal shareholders may be able to influence materially the outcome of
shareholder votes.

   As of March 3, 2000, Pacific Capital Group and its affiliates had a 11.98%
beneficial ownership interest in us. We have entered into various transactions
with Pacific Capital Group and its affiliates and assumed the on-going
development of some of our systems from an affiliate of Pacific Capital Group.
Mr. Gary Winnick, chairman of our board of directors, controls Pacific Capital
Group and its subsidiaries. In addition, several of our other officers and
directors are affiliated with Pacific Capital Group. Furthermore, as of March
3, 2000, Canadian Imperial Bank of Commerce and its affiliates had a 9.69%
beneficial ownership interest in us. Canadian Imperial Bank of Commerce and its
affiliates have acted as underwriter, lender or initial purchaser in several of
our financial transactions in connection with the development and construction
of our systems. Several members of our board of directors are employees of an
affiliate of Canadian Imperial Bank of Commerce.

   As of March 3, 2000, Pacific Capital Group and Canadian Imperial Bank of
Commerce collectively beneficially owned 21.67% of the outstanding shares of
our common stock. Accordingly, Pacific Capital Group and Canadian Imperial Bank
of Commerce may be able to influence materially the outcome of matters
submitted to a vote of our shareholders, including the election of directors.

Officers and directors own a substantial portion of us and may have conflicts
of interest.

   Our executive officers and directors have substantial equity interests in
us. As of March 3, 2000, all our directors and executive officers as a group
collectively beneficially owned 24.72% of our outstanding common stock,
including shares beneficially owned by Pacific Capital Group and certain shares
beneficially owned by Canadian Imperial Bank of Commerce. Some of these
individuals have also received amounts from us due to advisory services fees
paid to Pacific Capital Group and its affiliates.

                                       25
<PAGE>

   Some of our directors and executive officers also serve as officers and
directors of other companies. Additionally, some of our officers and directors
are active investors in the telecommunications industry. Service as one of our
directors or officers and as a director or officer of another company could
create conflicts of interest when the director or officer is faced with
decisions that could have different implications for us and the other company.
A conflict of interest could also exist with respect to allocation of time and
attention of persons who are our directors or officers and directors and
officers of another company. The pursuit of these other business interests
could distract these officers from pursuing opportunities on our behalf. These
conflicts of interest could have a material adverse effect on our business,
financial condition and results of operations.

We cannot predict our future tax liabilities.

   We believe that a significant portion of the income derived from our
undersea systems will not be subject to tax by any of (1) Bermuda, which
currently does not have a corporate income tax, or (2) some other countries in
which we conduct activities or in which our customers are located. However, we
base this belief upon:

  .  the anticipated nature and conduct of our business, which may change;
     and

  .  our understanding of our position under the tax laws of the various
     countries in which we have assets or conduct activities, which position
     is subject to review and possible challenge by taxing authorities and to
     possible changes in law, which may have retroactive effect.

   We cannot predict the amount of tax to which we may become subject and
cannot be certain that any of these factors would not have a material adverse
effect on our business, financial condition and results of operations.

Our shareholders may be subject to Foreign Personal Holding Company, Passive
Foreign Investment Company, Controlled Foreign Corporation and Personal
Holding Company rules.

   We believe that neither we nor any of our non-United States subsidiaries
are a foreign personal holding company and do not expect that either we or any
of our affiliates will become a foreign personal holding company. However, we
cannot assure you in this regard. If one of our shareholders is a United
States person and we or one of our non-United States subsidiaries are
classified as a foreign personal holding company, then that shareholder would
be required to pay tax on its pro rata share of our or our relevant non-United
States subsidiary's undistributed foreign personal holding income. We intend
to manage our affairs so as to attempt to avoid or minimize having income
imputed to United States persons under these rules, to the extent this
management of our affairs would be consistent with our business goals,
although we cannot assure you in this regard.

   We believe that we are not a passive foreign investment company and do not
expect to become a passive foreign investment company in the future. However,
we cannot assure you in this regard. In addition, our expectations are based,
in part, on interpretations of existing law that we believe are reasonable,
but which have not been approved by any taxing authority. If we were a passive
foreign investment company, then any of our shareholders that is a United
States person could be liable to pay tax at the then prevailing rates on
ordinary income plus an interest charge upon some distributions by us or when
that shareholder sold our capital stock at a gain.

   Furthermore, additional tax considerations would apply if we or any of our
affiliates were a controlled foreign corporation or a personal holding
company.

                                      26
<PAGE>

           CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

   We have included or incorporated by reference in this prospectus forward-
looking statements that state our own or our management's intentions, beliefs,
expectations or predictions for the future. Forward-looking statements are
subject to a number of risks, assumptions and uncertainties which could cause
our actual results to differ materially from those projected in the forward-
looking statements. These risks, assumptions and uncertainties include:

  .  the ability to complete systems within the currently estimated time
     frames and budgets;

  .  the ability to compete effectively in a rapidly evolving and price
     competitive marketplace;

  .  changes in the nature of telecommunications regulation in the United
     States and other countries;

  .  changes in business strategy;

  .  the successful integration of newly acquired businesses;

  .  the impact of technological change; and

  .  other risks referenced from time to time in our filings with the SEC.

                                USE OF PROCEEDS

   We will use the net proceeds from the sale of securities that we may offer
under this prospectus and any accompanying prospectus supplement for general
corporate purposes. General corporate purposes may include repayment of debt,
capital expenditures, possible acquisitions, investments, repurchase of our
capital stock and any other purposes that we may specify in any prospectus
supplement. We may invest the net proceeds temporarily or use them to repay
short-term debt until we use them for their stated purpose.

                                DIVIDEND POLICY

   We do not anticipate paying dividends on our common stock in the foreseeable
future. The terms of some of our debt instruments place limitations on our
ability to pay dividends. Future dividends on our common stock, if any, will be
at the discretion of our board of directors and will depend on, among other
things, our operations, capital requirements and surplus, general financial
condition, contractual restrictions and such other factors as our board of
directors may deem relevant.

                                       27
<PAGE>

                         DESCRIPTION OF DEBT SECURITIES

   The following description of the terms of the debt securities summarizes
some general terms that will apply to the debt securities. The description is
not complete, and we refer you to the indenture which we filed with the SEC as
an exhibit to the registration statement of which this prospectus is a part.

General

   The debt securities will be either our senior debt securities or our
subordinated debt securities. We will issue our debt securities under an
indenture between us and United States Trust Company of New York, as trustee.
The indenture may be supplemented by one or more supplemental indentures. We
refer to the indenture, together with any supplemental indenture, as the
"indenture" throughout the remainder of this prospectus.

   The indenture does not limit the amount of debt securities that we may
issue. The indenture provides that debt securities may be issued up to the
principal amount that we authorize from time to time. The senior debt
securities will be unsecured and will have the same rank as all of our other
unsecured and unsubordinated debt. The subordinated debt securities will be
unsecured and will be subordinated and junior to all senior indebtedness. The
terms of the indenture do not contain any covenants or other provisions
designed to give holders of any debt securities protection against changes in
our operations, financial condition or transactions involving us, but those
provisions may be included in the documents that include the specific terms of
the debt securities.

   We may issue the debt securities in one or more separate series of senior
debt securities and subordinated debt securities. The prospectus supplement
relating to the particular series of debt securities being offered will specify
the particular amounts, prices and terms of those debt securities. These terms
may include:

  .  the title of the debt securities;

  .  any limit upon the aggregate principal amount of the debt securities;

  .  if other than United States dollars, the currency or currencies,
     including the euro and other composite currencies, in which payments on
     the debt securities will be payable and whether the holder may elect
     payment to be made in a different currency;

  .  the date or dates when payments on the principal must be made or the
     method of determining that date or dates;

  .  interest rates, and the dates from which interest, if any, will accrue,
     and the dates when interest is payable and the maturity;

  .  the right, if any, to extend the interest payment periods and the
     duration of the extensions;

  .  the places where payments may be made and the manner of payments;

  .  any mandatory or optional redemption provisions;

  .  subordination provisions;

  .  the denominations in which debt securities will be issued;

  .  the terms applicable to any debt securities issued at a discount from
     their stated principal amount;

  .  the currency or currencies of payment of principal or interest; and the
     period, if any, during which a holder may elect to pay in a currency
     other than the currency in which the debt securities are denominated;

  .  if the amount of payments of principal or interest is to be determined
     by reference to an index or formula, or based on a coin or currency
     other than that in which the debt securities are stated to be payable,
     the manner in which these amounts are determined and the calculation
     agent, if any;

                                       28
<PAGE>

  .  whether the debt securities will be issued in fully registered form
     without coupons or in bearer form, with or without coupons, or any
     combination of these, and whether they will be issued in the form of one
     or more global securities in temporary or definitive form;

  .  whether and on what terms we will pay additional amounts to holders of
     the debt securities that are not United States persons in respect of any
     tax, assessment or governmental charge withheld or deducted and, if so,
     whether and on what terms we will have the option to redeem the debt
     securities rather than pay the additional amounts;

  .  the certificates or forms required for the issuance of debt securities
     in definitive form;

  .  the trustees, depositaries, authenticating or paying agents, transfer
     agents or registrars of the debt securities;

  .  any deletions of, or changes or additions to, the events of default or
     covenants;

  .  conversion or exchange provisions, if any, including conversion or
     exchange prices or rates and adjustments to those prices and rates; and

  .  any other specific terms of the debt securities.

   If any debt securities are sold for any foreign currency or currency unit or
if any payments on the debt securities are payable in any foreign currency or
currency unit, the prospectus supplement will contain any restrictions,
elections, tax consequences, specific terms and other information with respect
to the debt securities and the foreign currency or currency unit.

   Some of the debt securities may be issued as original issue discount debt
securities. Original issue discount securities may bear no interest or bear
interest at below-market rates and will be sold at a discount below their
stated principal amount and may bear no or below market interest. The
prospectus supplement will also contain any special tax, accounting or other
information relating to original issue discount securities other kinds of debt
securities that may be offered, including debt securities linked to an index or
payable in currencies other than United States dollars.

Registrar and Paying Agent

   The debt securities may be presented for registration of transfer or for
exchange at the corporate trust office of the security registrar or at any
other office or agency that we maintain for those purposes. In addition, the
debt securities may be presented for payment of principal, interest and any
premium at the office of the paying agent or at any office or agency that we
maintain for those purposes.

   United States Trust Company of New York is our designated security registrar
and paying agent for the debt securities.

Global Securities

   We may issue the debt securities of a series in whole or in part in the form
of one or more global certificates that will be deposited with a depositary we
will identify in a prospectus supplement. We may issue global debt securities
in either registered or unregistered form and in either temporary or definitive
form. We will describe the specific terms of the depositary arrangement with
respect to any series of debt securities in the prospectus supplement.

Conversion or Exchange Rights

   Debt securities may be convertible into or exchangeable for shares of our
equity securities or equity securities of our subsidiaries or affiliates. The
terms and conditions of conversion or exchange will be stated in the applicable
prospectus supplement. The terms will include, among others, the following:

  .  the conversion or exchange price;

                                       29
<PAGE>

  .  the conversion or exchange period;

  .  provisions regarding the convertibility or exchangeability of the debt
     securities, including who may convert or exchange;

  .  events requiring adjustment to the conversion or exchange price;

  .  provisions affecting conversion or exchange in the event of our
     redemption of the debt securities; and

  .  any anti-dilution provisions, if applicable.

Registered Global Securities

   Unless and until it is exchanged in whole or in part for debt securities in
definitive registered form, a registered global security may not be
transferred except as a whole:

  .  by the depositary for that registered global security to its nominee;

  .  by a nominee of the depositary to the depositary or another nominee of
     the depositary; or

  .  by the depositary or its nominee to a successor of the depositary or a
     nominee of the successor.

   The prospectus supplement relating to a series of debt securities will
describe the specific terms of the depositary arrangement involving any
portion of the series represented by a registered global security.

   We anticipate that the following provisions will apply to all depositary
arrangements for debt securities:

  .  ownership of beneficial interests in a registered global security will
     be limited to persons that have accounts with the depositary for that
     registered global security, these persons being referred to as
     "participants", or persons that may hold interests through participants;

  .  upon the issuance of a registered global security, the depositary for
     the registered global security will credit, on its book-entry
     registration and transfer system, the participants' accounts with the
     respective principal amounts of the debt securities represented by the
     registered global security beneficially owned by the participants;

  .  any dealers, underwriters or agents participating in the distribution of
     the debt securities will designate the accounts to be credited; and

  .  ownership of beneficial interest in that registered global security will
     be shown on, and the transfer of that ownership interest will be
     effected only through, records maintained by the depositary for that
     registered global security for interests of participants and on the
     records of participants for interests of persons holding through
     participants.

   The laws of some states may require that specified purchasers of securities
take physical delivery of the securities in definitive form. These laws may
limit the ability of those persons to own, transfer or pledge beneficial
interests in registered global securities.

   So long as the depositary for a registered global security, or its nominee,
is the registered owner of that registered global security, the depositary or
that nominee will be considered the sole owner or holder of the debt
securities represented by the registered global security for all purposes
under the indenture. Except as stated below, owners of beneficial interests in
a registered global security:

  .  will not be entitled to have the debt securities represented by a
     registered global security registered in their names;

  .  will not receive or be entitled to receive physical delivery of the debt
     securities in definitive form; and

  .  will not be considered the owners or holders of the debt securities
     under the indenture.

                                      30
<PAGE>

   Accordingly, each person owning a beneficial interest in a registered global
security must rely on the procedures of the depositary for the registered
global security and, if the person is not a participant, on the procedures of a
participant through which the person owns its interest, to exercise any rights
of a holder under the indenture.

   We understand that under existing industry practices, if we request any
action of holders or if an owner of a beneficial interest in a registered
global security desires to give or take any action that a holder is entitled to
give or take under the indenture, the depositary for the registered global
security would authorize the participants holding the relevant beneficial
interests to give or take the action, and the participants would authorize
beneficial owners owning through the participants to give or take the action or
would otherwise act upon the instructions of beneficial owners holding through
them.

   We will make payments of principal and premium, if any, and interest, if
any, on debt securities represented by a registered global security registered
in the name of a depositary or its nominee to the depositary or its nominee as
the registered owners of the registered global security. None of us, the
trustee or any other of our agents or agents of the trustee will be responsible
or liable for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the registered global security or
for maintaining, supervising or reviewing any records relating to the
beneficial ownership interests.

   We expect that the depositary for any debt securities represented by a
registered global security, upon receipt of any payments of principal and
premium, if any, and interest, if any, in respect of the registered global
security, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
registered global security as shown on the records of the depositary. We also
expect that standing customer instructions and customary practices will govern
payments by participants to owners of beneficial interests in the registered
global security held through the participants, as is now the case with the
securities held for the accounts of customers in bearer form or registered in
"street name". We also expect that any of these payments will be the
responsibility of the participants.

   If the depositary for any debt securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or stops
being a clearing agency registered under the Exchange Act, we will appoint an
eligible successor depositary. If we fail to appoint an eligible successor
depositary within 90 days, we will issue the debt securities in definitive form
in exchange for the registered global security. In addition, we may at any time
and in our sole discretion decide not to have any of the debt securities of a
series represented by one or more registered global securities. In that
event,we will issue debt securities of the series in a definitive form in
exchange for all of the registered global securities representing the debt
securities. The trustee will register any debt securities issued in definitive
form in exchange for a registered global security in the name or names as the
depositary, based upon instructions from its participants, will instruct the
trustee.

   We may also issue bearer debt securities of a series in the form of one or
more global securities, referred to as "bearer global securities". We will
deposit these securities with a common depositary for Euroclear System and
Clearstream Banking, or with a nominee for the depositary identified in the
prospectus supplement relating to the series. The prospectus supplement
relating to a series of debt securities represented by a bearer global security
will describe the applicable terms and procedures. These will include the
specific terms of the depositary arrangement and any specific procedures for
the issuance of debt securities in definitive form in exchange for a bearer
global security, in proportion to the series represented by a bearer global
security.

Events of Default

   Unless otherwise provided for in the prospectus supplement, the term "event
of default", when used in the indenture means any of the following:

  .  failure to pay interest for 30 days after the date payment is due and
     payable; however, if we extend an interest payment period under the
     terms of the debt securities, the extension will not be a failure to pay
     interest;

                                       31
<PAGE>

  .  failure to pay principal or premium, if any, on any debt security when
     due, either at maturity, upon any redemption, by declaration or
     otherwise;

  .  failure to make sinking fund payments, if any, when due;

  .  failure to perform other covenants for 60 days after notice that
     performance was required;

  .  events in bankruptcy, insolvency or reorganization of our company; or

  .  any other event of default provided in the applicable resolution of our
     board of directors or the supplemental indenture under which we issue a
     series of debt securities.

   An event of default for a particular series of debt securities does not
necessarily constitute an event of default for any other series of debt
securities issued under the indenture. If an event of default relating to the
payment of interest, principal or any sinking fund installment involving any
series of debt securities has occurred and is continuing, the trustee or the
holders of not less than 25% in aggregate principal amount of the debt
securities of each affected series may declare the entire principal of all the
debt securities of that series to be due and payable immediately.

   If an event of default relating to the performance of other covenants occurs
and is continuing for a period of 60 days after notice of that event of
default, or if any other event of default occurs and is continuing involving
all of the series of senior debt securities, then the trustee or the holders of
not less than 25% in aggregate principal amount of all of the series of senior
debt securities may declare the entire principal amount of all of the series of
senior debt securities due and payable immediately.

   Similarly, if an event of default relating to the performance of other
covenants occurs and is continuing for a period of 60 days after notice, or if
any other event of default occurs and is continuing involving all of the series
of subordinated debt securities, then the trustee or the holders of not less
than 25% in aggregate principal amount of all of the series of subordinated
debt securities may declare the entire principal amount of all of the series of
subordinated debt securities due and payable immediately.

   If, however, the event of default relating to the performance of other
covenants or any other event of default that has occurred and is continuing is
for less than all of the series of senior debt securities or subordinated debt
securities, then, the trustee or the holders of not less than 25% in aggregate
principal amount of each affected series of the senior debt securities or the
subordinated debt securities, as the case may be, may declare the entire
principal amount of all debt securities of that affected series due and payable
immediately. The holders of not less than a majority, or any applicable
supermajority, in aggregate principal amount of the debt securities of a series
may, after satisfying conditions, rescind and annul any of the above-described
declarations and consequences involving the series.

   If an event of default relating to events in bankruptcy, insolvency or
reorganization occurs and is continuing, then the principal amount of all of
the debt securities outstanding, and any accrued interest, will automatically
become due and payable immediately, without any declaration or other act by the
trustee or any holder.

   The indenture imposes limitations on suits brought by holders of debt
securities against us. Except for actions for payment of overdue principal or
interest, no holder of debt securities of any series may institute any action
against us under the indenture unless:

  .  the holder has previously given to the trustee written notice of default
     and continuance of that default;

  .  the holders of at least 25% in principal amount of the outstanding debt
     securities of the affected series have requested that the trustee
     institute the action;

                                       32
<PAGE>

  .  the requesting holders have offered the trustee reasonable indemnity for
     expenses and liabilities that may be incurred by bringing the action;

  .  the trustee has not instituted the action within 60 days of the request;
     and

  .  the trustee has not received inconsistent direction by the holders of a
     majority in principal amount of the outstanding debt securities of the
     series.

   We will be required to file annually with the trustee a certificate, signed
by an officer of our company, stating whether or not the officer knows of any
default by us in the performance, observance or fulfillment of any condition or
covenant of the indenture.

Discharge, Defeasance and Covenant Defeasance

   We can discharge or defease our obligations under the indenture as stated
below or as provided in the prospectus supplement.

   Unless otherwise provided in the applicable prospectus supplement, we may
discharge obligations to holders of any series of debt securities that have not
already been delivered to the trustee for cancellation and that have either
become due and payable or are by their terms to become due and payable, or are
scheduled for redemption, within one year. We may effect a discharge by
irrevocably depositing with the trustee cash or United States government
obligations, as trust funds, in an amount certified to be enough to pay when
due, whether at maturity, upon redemption or otherwise, the principal of,
premium, if any, and interest on the debt securities and any mandatory sinking
fund payments.

   Unless otherwise provided in the applicable prospectus supplement, we may
also discharge any and all of our obligations to holders of any series of debt
securities at any time, which we refer to as "defeasance". We may also be
released from the obligations imposed by any covenants of any outstanding
series of debt securities and provisions of the indenture, and we may omit to
comply with those covenants without creating an event of default under the
trust declaration, which we refer to as "covenant defeasance". We may effect
defeasance and covenant defeasance only if, among other things:

  .  we irrevocably deposit with the trustee cash or United States government
     obligations, as trust funds, in an amount certified to be enough to pay
     at maturity, or upon redemption, the principal, premium, if any, and
     interest on all outstanding debt securities of the series;

  .  we deliver to the trustee an opinion of counsel from a nationally
     recognized law firm to the effect that (a) in the case of covenant
     defeasance, the holders of the series of debt securities will not
     recognize income, gain or loss for United States federal income tax
     purposes as a result of the defeasance, and will be subject to tax in
     the same manner and at the same times as if no covenant defeasance had
     occurred and (b) in the case of defeasance, either we have received
     from, or there has been published by, the Internal Revenue Service a
     ruling or there has been a change in applicable United States federal
     income tax law, and based on that ruling or change, the holders of the
     series of debt securities will not recognize income, gain or loss for
     United States federal income tax purposes as a result of the defeasance
     and will be subject to tax in the same manner as if no defeasance had
     occurred; and

  .  in the case of subordinated debt securities, no event or condition will
     exist that, based on the subordination provisions applicable to the
     series, would prevent us from making payments of principal of, premium,
     if any, and interest on any of the applicable subordinated debt
     securities at the date of the irrevocable deposit referred to above or
     at any time during the period ending on the 91st day after the deposit
     date.

   Although we may discharge or decrease our obligations under the indenture as
described in the two preceding paragraphs, we may not avoid, among other
things, our duty to register the transfer or exchange of any series of debt
securities, to replace any temporary, mutilated, destroyed, lost or stolen
series of debt securities or to maintain an office or agency in respect of any
series of debt securities.

                                       33
<PAGE>

Modification of the Indenture

   Except as provided in the prospectus supplement, the indenture provides that
we and the trustee may enter into supplemental indentures without the consent
of the holders of debt securities to:

  .  secure any debt securities;

  .  evidence the assumption by a successor corporation of our obligations
     and the conversion of any debt securities into the capital stock of that
     successor corporation, if the terms of those debt securities so provide;

  .  add covenants for the protection of the holders of debt securities;

  .  cure any ambiguity or correct any inconsistency in the indenture;

  .  establish the forms or terms of debt securities of any series; and

  .  evidence and provide for the acceptance of appointment by a successor
     trustee.

   The indenture also provides that we and the trustee may, with the consent of
the holders of not less than a majority in aggregate principal amount of debt
securities of all series of senior debt securities or of subordinated debt
securities then outstanding and affected, voting as one class, add any
provisions to, or change in any manner, eliminate or modify in any way the
provisions of, the indenture or modify in any manner the rights of the holders
of the debt securities. We and the trustee may not, however, without the
consent of the holder of each outstanding debt security affected:

  .  extend the final maturity of any debt security;

  .  reduce the principal amount or premium, if any;

  .  reduce the rate or extend the time of payment of interest;

  .  reduce any amount payable on redemption;

  .  change the currency in which the principal, unless otherwise provided
     for a series, premium, if any, or interest is payable;

  .  reduce the amount of the principal of any debt security issued with an
     original issue discount that is payable upon acceleration or provable in
     bankruptcy;

  .  impair the right to institute suit for the enforcement of any payment on
     any debt security when due; or

  .  reduce the percentage of holders of debt securities of any series whose
     consent is required for any modification of the indenture.

Concerning the Trustee

   The indenture provides that there may be more than one trustee under the
indenture, each for one or more series of debt securities. If there are
different trustees for different series of debt securities, each trustee will
be a trustee of a trust under the indenture separate and apart from the trust
administered by any other trustee under the indenture. Except as otherwise
indicated in this prospectus or any prospectus supplement, any action permitted
to be taken by a trustee may be taken by that trustee only on the one or more
series of debt securities for which it is the trustee under the indenture. Any
trustee under the indenture may resign or be removed from one or more series of
debt securities. All payments of principal of, premium, if any, and interest
on, and all registration, transfer, exchange, authentication and delivery of,
the debt securities of a series will be effected by the trustee for that series
at an office designated by the trustee of that series in New York, New York.

   If the trustee becomes a creditor of our company, the indenture places
limitations on the right of the trustee to obtain payment of claims or to
realize on property received in respect of any such claim as security or
otherwise. The trustee may engage in other transactions. If it acquires any
conflicting interest relating to any duties concerning the debt securities,
however, it must eliminate the conflict or resign as trustee.


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<PAGE>

   The holders of a majority in aggregate principal amount of any series of
debt securities then outstanding will have the right to direct the time, method
and place of conducting any proceeding for exercising any remedy available to
the trustee concerning the applicable series of debt securities, so long as the
direction:

  .  would not conflict with any rule of law or with the indenture;

  .  would not be unduly prejudicial to the rights of another holder of the
     debt securities; and

  .  would not involve any trustee in personal liability.

   The indenture provides that if an event of default occurs, is not cured and
is known to any trustee, the trustee must use the same degree of care as a
prudent person would use in the conduct of his or her own affairs in the
exercise of the trust's power. The trustee will be under no obligation to
exercise any of its rights or powers under the indenture at the request of any
of the holders of the debt securities, unless they have offered to the trustee
security and indemnity satisfactory to the trustee.

No Individual Liability of Incorporators, Shareholders, Officers or Directors

   The indenture provides that no incorporator and no past, present or future
shareholder, officer or director of our company or any successor corporation in
those capacities will have any individual liability for any of our obligations,
covenants or agreements under the debt securities or the indenture.

Governing Law

   The indenture and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.

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                         DESCRIPTION OF PREFERRED STOCK

   We have authorized 20,000,000 shares of preferred stock, par value $0.01 per
share. At March 20, 2000, we had (1) 10,000,000 shares of our 6 3/8% cumulative
convertible preferred stock issued and outstanding, (2) 2,600,000 shares of our
7% cumulative convertible preferred stock issued and outstanding and (3)
400,000 shares of our 6 3/8% cumulative convertible preferred stock, series B,
issued and outstanding.

   Our board of directors is authorized to:

  .authorize the issuance of shares of preferred stock in one or more series;

  .  establish the number of shares in each series; and

  .  fix the designations, powers, preferences and rights of each series and
     the qualifications, limitations or restrictions of each series.

   Each time that we issue a new series of preferred stock, we will file with
the SEC a definitive certificate of designations. In addition, the prospectus
supplement relating to that new series of preferred stock will specify the
particular amount, price and other terms of that new series. These terms will
include:

  .  the designation of the title of the series;

  .  dividend rates;

  .  redemption provisions, if any;

  .  special or relative rights in the event of liquidation, dissolution,
     distribution or winding up of Global Crossing;

  .  sinking fund provisions, if any;

  .  whether the preferred stock will be convertible into our common stock or
     any other of our securities or exchangeable for securities of any other
     person;

  .  voting rights; and

  .  any other preferences, privileges, powers, rights, qualifications,
     limitations and restrictions, not inconsistent with our bye-laws.

   The shares of any series of preferred stock will be, when issued, fully paid
and non-assessable. The holders of the preferred stock will not have preemptive
rights.

Ranking

   Each new series of preferred stock will rank with respect to each other
series of our preferred stock as specified in the prospectus supplement
relating to that new series of preferred stock.

Dividends

   Holders of each new series of preferred stock will be entitled to receive
cash dividends or dividends in kind, if declared by our board of directors out
of funds legally available for dividends. For each series of preferred stock,
we will specify in the prospectus supplement:

  .  the dividend rates;

  .  whether the rates will be fixed or variable or both;

  .  the dates of distribution of the cash dividends; and

  .  whether the dividends on any series of preferred stock will be
     cumulative or non-cumulative.

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<PAGE>

Conversion and exchange

   The prospectus supplement for any new series of preferred stock will state
the terms and other provisions, if any, on which shares of the new series of
preferred stock are convertible into shares of our common stock or exchangeable
for securities of a third party.

Redemption

   We will specify in the prospectus supplement relating to each new series of
preferred stock:

  .  whether that new series will be redeemable at any time, in whole or in
     part, at our option or at the option of the holder of the shares of
     preferred stock;

  .  whether that new series will be subject to mandatory redemption under a
     sinking fund or on other terms; and

  .  the redemption prices.

Liquidation preference

   Upon our voluntary or involuntary liquidation, dissolution or winding up,
holders of each series of preferred stock will be entitled to receive:

  .  distributions upon liquidation in the amount provided in the prospectus
     supplement of that series of preferred stock; plus

  .  any accrued and unpaid dividends.

   These payments will be made to holders of preferred stock out of our assets
available for distribution to shareholders before any distribution is made on
any securities ranking junior to the preferred stock regarding liquidation
rights.

   After payment of the full amount of the liquidation preference to which they
are entitled, the holders of each series of preferred stock will not be
entitled to any further participation in any distribution of our assets.

Voting rights

   The holders of shares of any series of preferred stock will have no voting
rights except as indicated in the certificate of designations or prospectus
supplement relating to that series or as required by law.

Transfer agent and registrar

   We will specify each of the transfer agent, registrar, dividend disbursing
agent and redemption agent for shares of each new series of preferred stock in
the prospectus supplement relating to that series.

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<PAGE>

                          DESCRIPTION OF COMMON STOCK

   The following summary is a description of the material terms of our common
stock, does not purport to be complete and is subject in all respects to the
applicable provisions of Bermuda law and of our constituent documents and of
the constituent documents of our subsidiaries. We have filed our memorandum of
association and bye-laws as exhibits to the registration statement of which
this prospectus is a part.

General

   Under our memorandum of association, our authorized share capital is
$30,200,000, divided into:

  .  3,000,000,000 shares of common stock, par value $0.01 per share; and

  .  20,000,000 shares of preferred stock, par value $0.01 per share.

Voting and transfer restrictions

   Voting restriction. Each share of our common stock has one vote, except that
if any shareholder owns, directly, indirectly or constructively under Section
958 of the Internal Revenue Code or beneficially directly or indirectly as a
result of the possession of sole or shared voting power within the meaning of
Section 13(d) of the Exchange Act and the rules and regulations promulgated
under that act, more than 9.5%, or, in the case of Canadian Imperial Bank of
Commerce and its affiliates, collectively, more than 20%, of the votes cast in
connection with any matter which our shareholders are voting on, the number of
votes of that shareholder will be limited to 9.5%, or, in the case of the
Canadian Imperial Bank of Commerce and its affiliates, collectively, to 20% of
those votes cast, based on a formula contained in our bye-laws. The additional
votes that could be cast by that shareholder but for the restrictions on the
voting rights will be allocated to the other shareholders pro rata, based on
their number of shares of common stock. Shareholders that have been allocated
additional votes may not exceed the voting limitations as a result of that
allocation.

   Transfer restriction. Our bye-laws also provide that any transfer of shares
of common stock or any interest in those shares that results in a shareholder,
other than Pacific Capital Group, GKW Unified Holdings, Canadian Imperial Bank
of Commerce, Continental Casualty Company or MRCo or their affiliates or some
of their lenders, beneficially owning within the meaning of Section 13(d) of
the Exchange Act, directly or indirectly, 5% of the outstanding shares of our
common stock, if that shareholder is a natural person, or otherwise 9.5% of the
outstanding shares of our common stock, without the approval of a majority of
the members of the board of directors and of shareholders holding at least a
majority of the total votes cast at the shareholder meeting called to approve
that transfer will not be registered in the share register and will be void and
of no effect.

   Amendments to the voting reallocation and transfer restriction provisions of
our bye-laws require the approval of our board of directors and shareholders
holding at least 75% of the votes of all outstanding shares of common stock. In
the event of any amendment to these bye-laws, under some circumstances, we have
the obligation to indemnify and hold harmless any shareholder who, as a result
of that amendment, becomes subject to treatment as a U.S. shareholder for
purposes of Section 951 and subsequent sections of the Internal Revenue Code
from and against all losses, costs, damages, liabilities and expenses directly
or indirectly arising out of that treatment.

   These voting and transfer restrictions could make it difficult for any
person or group of persons acting in concert, other than some existing owners,
to acquire control of Global Crossing.

Distributions

   Holders of common stock are treated equally with respect to all
distributions to our shareholders.


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<PAGE>


Global Crossing registration rights agreement

   Pacific Capital Group, GKW Unified Holdings, affiliates of Canadian Imperial
Bank of Commerce, Continental Casualty Company, MRCo, ourselves and some other
shareholders of ours, including some of our officers and directors and their
affiliates, have entered into a registration rights agreement filed as an
exhibit to our registration statements.

   Under the registration rights agreement, our shareholders who are parties to
that agreement and a number of their transferees have demand and piggyback
registration rights and will receive indemnification and, in some
circumstances, reimbursement for expenses from us in connection with an
applicable registration.

Transfer Agent, Registrar and Dividend Disbursing Agent

   The transfer agent, registrar, dividend disbursing agent and redemption
agent for the shares of our common stock will be EquiServe.

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<PAGE>

                            DESCRIPTION OF WARRANTS

   We may issue warrants, including debt warrants, which are warrants to
purchase debt securities, and equity warrants, which are warrants to purchase
common stock or preferred stock.

   Each series of warrants will be issued under a separate warrant agreement to
be entered into between us and a warrant agent. The warrant agent will act
solely as our agent in connection with a series of warrants and will not assume
any obligation or relationship of agency for or with holders or beneficial
owners of warrants. The following describes the general terms and provisions of
the warrants offered by this prospectus. The applicable prospectus supplement
will describe any other terms of the warrant and the applicable warrant
agreement.

Debt warrants

   The applicable prospectus supplement will describe the terms of any debt
warrants, including the following:

  .  the title and aggregate number of the debt warrants;

  .  any offering price of the debt warrants;

  .  the number of debt warrants and debt securities that will be separately
     transferable;

  .  any date on and after which the debt warrants and debt securities will
     be separately transferable;

  .  the title, total principal amount, ranking and terms, including
     subordination and conversion provisions, of the underlying debt
     securities that may be purchased upon exercise of the debt warrants;

  .  the time or period when the debt warrants are exercisable, the minimum
     or maximum amount of debt warrants which may be exercised at any one
     time and the final date on which the debt warrants may be exercised;

  .  the principal amount of underlying debt securities that may be purchased
     upon exercise of each debt warrant and the price, or the manner of
     determining the price, at which the principal amount may be purchased
     upon exercise;

  .  the terms of any right to redeem or call the debt warrants;

  .  any book-entry procedure information;

  .  any currency or currency units in which the offering price and the
     exercise price are payable; and

  .  any other terms of the debt warrants not inconsistent with the
     provisions of the debt warrant agreement.

Equity warrants

   The applicable prospectus supplement will describe the terms of any equity
warrants, including the following:

  .  the title and aggregate number of the equity warrants;

  .  any offering price of the equity warrants;

  .  the designation and terms of any shares of preferred stock that are
     purchasable upon exercise of the equity warrants;

  .  if applicable, the designation and terms of the securities with which
     the equity warrants are issued and the number of the equity warrants
     issued with each security;


                                       40
<PAGE>

  .  if applicable, the date from and after which the equity warrants and any
     securities issued with those warrants will be separately transferrable;

  .  the number of shares of common stock or preferred stock purchasable upon
     exercise of an equity warrant and the price;

  .  the time or period when the equity warrants are exercisable and the
     final date on which the equity warrants may be exercised and terms
     regarding any of our rights to accelerate this final date;

  .  if applicable, the minimum or maximum amount of the equity warrants
     exercisable at any one time;

  .  any currency or currency units in which the offering price and the
     exercise price are payable;

  .  any applicable anti-dilution provisions of the equity warrants;

  .  any applicable redemption or call provisions; and

  .  any additional terms of the equity warrants not inconsistent with the
     provisions of the equity warrant agreement.

                                       41
<PAGE>

                        CERTAIN INCOME TAX CONSEQUENCES

Taxation of Global Crossing

   We believe that a significant portion of the income derived from our subsea
systems will not be subject to tax in Bermuda, which currently has no corporate
income tax, or other countries in which we or our affiliates conduct activities
or in which our customers are located, including the United States. However,
this belief is based upon the anticipated nature and conduct of our business,
which may change, and upon our understanding of our position under the tax laws
of the various countries in which we have assets or conduct activities, which
position is subject to review and possible challenge by taxing authorities and
to possible changes in law, which may have retroactive effect. The extent to
which certain taxing jurisdictions may require us to pay tax or to make
payments in lieu of tax cannot be determined in advance. In addition, our
operations and payments due to us may be affected by changes in taxation,
including retroactive tax claims or assessments of withholding on amounts
payable to us or other taxes assessed at the source, in excess of the taxation
we anticipate based on business contacts and practices and the current tax
regimes. We cannot assure you that these factors will not have a material
adverse effect on us.

 Bermuda Tax Considerations

   Under current Bermuda law, we are not subject to tax on income or capital
gains. Furthermore, we have obtained from the Minister of Finance of Bermuda
under the Exempted Undertakings Tax Protection Act 1966, an undertaking that,
in the event that Bermuda enacts any legislation imposing tax computed on
profits, income, any capital asset, gain or appreciation, then the imposition
of that tax will not be applicable to us or to any of our operations, neither
will that tax, or any tax in the nature of estate duty or inheritance tax,
become applicable to our stock, until March 28, 2016. This undertaking does
not, however, prevent the imposition of any tax or duty on persons ordinarily
resident in Bermuda or any property tax on any company, including ourselves,
owning real property or leasehold interests in Bermuda.

 United States Federal Income Tax Considerations

   We and our non-United States subsidiaries will be subject to United States
federal income tax at regular corporate rates, and to United States branch
profits tax, on our income, if any, that is effectively connected with the
conduct of a trade or business within the United States, and will be required
to file federal income tax returns reflecting that income. We intend to conduct
our operations so as to reduce the amount of our effectively connected income.
However, we cannot assure you that the Internal Revenue Service will agree with
the positions we take in this regard. Moreover, our United States subsidiaries
will be subject to United States federal income tax on their worldwide income
regardless of its source, subject to reduction by allowable foreign tax
credits, and distributions by our United States subsidiaries to us or to our
non-United States subsidiaries generally will be subject to United States
withholding tax.

Taxation of Holders

 Bermuda Tax Considerations

   Under current Bermuda law, no income, withholding or other taxes or stamp or
other duties are imposed upon the issue, transfer or sale of the shares of
common stock, shares of preferred stock, equity warrants, debt warrants or debt
securities, or on any payments thereunder. See "Taxation of Global Crossing--
Bermuda Tax Considerations" above for a description of the undertaking on taxes
obtained by us from the Minister of Finance of Bermuda.

 United States Federal Income Tax Considerations

   The following is a summary of certain United States federal income tax
consequences, as of the date of this document, of the ownership of shares of
common stock, shares of preferred stock, equity warrants or debt securities by
beneficial owners that purchase the shares, equity warrants or debt securities
in connection with their initial issuance, that hold the shares, equity
warrants or debt securities as capital assets and that are "United States
persons" under the Internal Revenue Code. Under the Internal Revenue Code, you
are a "United States person" if you are:

   .  a citizen or resident of the United States;

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<PAGE>

  .  a corporation or partnership created or organized in or under the laws
     of the United States or any political subdivision thereof;

  .  an estate the income of which is subject to United States federal income
     taxation regardless of its source;

  .  a trust that is subject to the supervision of a court within the United
     States and the control of one or more United States persons; or

  .  a trust that has a valid election in effect under applicable United
     States Treasury regulations to be treated as a United States person.

   This summary is based on current law, which is subject to change, perhaps
retroactively, is for general purposes only and should not be considered tax
advice. This summary does not represent a detailed description of the United
States federal income tax consequences to you in light of your particular
circumstances. In addition, it does not present a description of the United
States federal income tax consequences applicable to you if you are subject to
special treatment under the United States federal income tax laws, including if
you are:

  .  a dealer in securities or currencies;

  .  a trader in securities if you elect to use a mark-to-market method of
     accounting for your securities holdings;

  .  a financial institution;

  .  an insurance company;

  .  a tax-exempt organization;

  .  a person liable for alternative minimum tax;

  .  a person holding shares of common stock, shares of preferred stock,
     equity warrants or debt securities as part of a hedging, integrated or
     conversion transaction, constructive sale or straddle;

  .  a person owning, actually or constructively, 10% or more of our voting
     stock or 10% or more of the voting stock of any of our non-United States
     subsidiaries; or

  .  a United States person whose "functional currency" is not the United
     States dollar.

   We cannot assure you that a later change in law will not alter significantly
the tax considerations that we describe in this summary. The discussion below
assumes that all debt securities issued hereunder will be classified as debt
for United States federal income tax purposes, and holders should note that in
the event of an alternative characterization, the tax consequences would differ
from those discussed below.

   If a partnership holds our shares of common stock, shares of preferred
stock, equity warrants or debt securities, the tax treatment of a partner will
generally depend upon the status of the partner and the activities of the
partnership. If you are a partner of a partnership holding our shares of common
stock, shares of preferred stock, equity warrants or debt securities, you
should consult your tax advisor.

   You should consult your own tax advisor concerning the particular United
States federal income tax consequences to you of the ownership and disposition
of the shares of common stock, shares of preferred stock, equity warrants or
debt securities, as well as the consequences to you arising under the laws of
any other taxing jurisdiction.

                           Common and Preferred Stock

Taxation of Dividends

   Subject to the passive foreign investment company rules discussed below, the
gross amount of distributions you receive on your shares of common stock or
shares of preferred stock, will generally be treated as dividend income to you
if the distributions are made from our current and accumulated earnings and
profits,

                                       43
<PAGE>

calculated according to United States federal income tax principles. Such
income will be includible in your gross income as ordinary income on the day
you receive it. You will not be entitled to claim a dividends received
deduction with respect to distributions you receive from us.

   Although we expect to have earnings and profits with respect to 2000, the
existence of current or accumulated earnings and profits in subsequent years
will depend on future levels of profits and losses which we cannot accurately
predict at this time. To the extent that the amount of any distribution exceeds
our current and accumulated earnings and profits for a taxable year, the
distribution will first be treated as a tax-free return of capital, causing a
reduction in your adjusted basis in the shares of common stock or shares of
preferred stock, thereby increasing the amount of gain, or decreasing the
amount of loss, you will recognize on a subsequent disposition of the shares,
and the balance in excess of adjusted basis will be taxed as capital gain
recognized on a sale or exchange.

   If, for United States federal income tax purposes, we are classified as a
"United States-owned foreign corporation", distributions made to you with
respect to your shares of common stock or shares of preferred stock that are
taxable as dividends generally will be treated for United States foreign tax
credit purposes as (1) foreign source "passive income" or, in the case of some
holders, foreign source "financial services income" and (2) United States
source income, in proportion to our earnings and profits in the year of such
distribution allocable to foreign and United States sources, respectively. For
this purpose, we will be treated as a United States-owned foreign corporation
so long as stock representing 50% or more of the voting power or value of our
stock is owned, directly or indirectly, by United States persons.

Preferred Stock Redemption Premium

   Under Section 305(c) of the Internal Revenue Code and the applicable
regulations thereunder, if in certain circumstances the redemption price of the
preferred stock exceeds its issue price by more than a de minimis amount, the
difference--which we refer to as "redemption premium"--will be taxable as a
constructive distribution to you over time of additional preferred stock. These
constructive distributions would be treated first as a dividend to the extent
of our current and accumulated earnings and profits and otherwise would be
subject to the treatment described above for dividends. If the preferred stock
provides for optional rights of redemption by us at prices in excess of the
issue price, you could be required to recognize such excess if, based on all of
the facts and circumstances, the optional redemptions are more likely than not
to occur. Applicable regulations provide a "safe harbor" under which a right to
redeem will not be treated as more likely than not to occur if (1) you are not
related to us within the meaning of the regulations; (2) there are no plans,
arrangements, or agreements that effectively require or are intended to compel
us to redeem the stock and (3) exercise of the right to redeem would not reduce
the yield of the stock, as determined under the regulations. Regardless of
whether the optional redemptions are more likely than not to occur,
constructive dividend treatment will not result if the redemption premium does
not exceed a de minimis amount or is in the nature of a penalty for premature
redemption. You should also consult the applicable prospectus supplement for
information regarding any additional consequences under Section 305(c) in light
of the particular terms of an issuance of preferred stock.

Disposition of the Shares of Common Stock or Shares of Preferred Stock

   Subject to the passive foreign investment company rules discussed below,
when you sell or otherwise dispose of your shares of common stock or shares of
preferred stock, you will recognize capital gain or loss in an amount equal to
the difference between the amount you realize for the shares and your adjusted
tax basis in them. In general, your adjusted tax basis in the shares of common
stock will be your cost of obtaining the shares reduced by any previous
distributions that are not characterized as dividends. In general, your
adjusted tax basis in the shares of preferred stock will be your cost of
obtaining the shares of preferred stock increased by any redemption premium
previously included in income by you and reduced by any previous distributions
that are not characterized as dividends. For foreign tax credit limitation
purposes, such gain or loss will generally be treated as United States source.
If you are an individual, and the shares of common stock or shares

                                       44
<PAGE>

of preferred stock being sold or otherwise disposed of are capital assets that
you have held for more than one year, your gain recognized will be taxed at a
maximum tax rate of 20%. Your ability to deduct capital losses is subject to
limitations.

   A redemption of the shares of common stock or the shares of preferred stock
by us would be treated, under Section 302 of the Internal Revenue Code, as a
sale giving rise to capital gain or loss, or as described below as a dividend.
If a redemption of shares for cash is treated as a dividend with respect to you
under Section 302 of the Internal Revenue Code, you (1) will not recognize any
loss on the exchange and (2) will recognize dividend income, rather than
capital gain, equal to the amount of cash received, without regard to your
basis in the shares of the common stock or the shares of preferred stock
surrendered in the exchange, to the extent of your proportionate share of our
current or accumulated earnings and profits. Under Section 302 of the Internal
Revenue Code, the redemption will not be treated as a dividend provided that,
after giving effect to the constructive ownership rules of Section 318 of the
Internal Revenue Code, the redemption (1) represents a "complete termination"
of your stock interest in us, (2) is "substantially disproportionate" with
respect to you or (3) is "not essentially equivalent to a dividend" with
respect to you, all within the meaning of Section 302(b) of the Internal
Revenue Code. A redemption will be "not essentially equivalent to a dividend"
as to you if it results in a "meaningful reduction" in your interest in us,
after application of the constructive ownership rules of Section 318 of the
Internal Revenue Code. In general, there are no fixed rules for determining
whether a "meaningful reduction" has occurred. You should consult your tax
advisor as to your ability in light of your own particular circumstances to
satisfy any of the foregoing tests.

Conversion of Convertible Preferred Stock into Common Stock

   Generally, no gain or loss will be recognized upon conversion of shares of
convertible preferred stock into shares of common stock, except with respect to
any cash paid in lieu of fractional shares of common stock. The tax basis of
shares of common stock received upon conversion of shares of preferred stock
generally will be equal to the tax basis of the shares of preferred stock so
converted and the holding period of the shares of common stock generally will
include the holding period of the shares of preferred stock so converted.

   Adjustments to the conversion ratio of the preferred stock pursuant to anti-
dilution provisions, if any, may result in a taxable deemed distribution to you
pursuant to Section 305 of the Code if (1) as a result of such adjustment your
proportionate interest in our assets or earnings and profits is increased and
(2) the adjustment is not made pursuant to a bona fide, reasonable anti-
dilution formula. An adjustment to the conversion ratio of the preferred stock
would not be considered made pursuant to such a formula if the adjustment were
made to compensate you for certain taxable distributions to other common stock
holders. Thus, under certain circumstances, an adjustment might give rise to a
taxable dividend to you even though you did not receive any cash. You should
consult the applicable prospectus supplement for information regarding
adjustments, if any, to the conversion ratio of shares of convertible preferred
stock and regarding the terms of any preferred stock that is convertible or
exchangeable for securities other than our common stock.

Passive Foreign Investment Company

   We do not believe that we are a passive foreign investment company for
United States federal income tax purposes and do not expect to become one in
the future, although we can provide no assurance in this regard. This
conclusion is based, in part, on interpretations of existing law that we
believe are reasonable, but which have not been approved by any taxing
authority. A company is considered a passive foreign investment company for any
taxable year if either:

  .  at least 75% of its gross income is passive income; or

  .  at least 50% of the value of its assets is attributable to assets that
     produce or are held for the production of passive income.

   The 50% of value test is based on the average of the value of our assets for
each quarter during the taxable year. If we own at least 25% by value of
another company's stock, we will be treated as owning our

                                       45
<PAGE>

proportionate share of the assets and earning our proportionate share of the
income of that company. The determination of whether we are a passive foreign
investment company is made annually. Accordingly, it is possible that we may
become a passive foreign investment company in the current or any future
taxable year due to changes in our asset or income composition.

   If we are a passive foreign investment company for any taxable year during
which you hold shares of common stock, shares of preferred stock or equity
warrants, unless you make a "QEF election" or a "mark to market election" as
described below, you will be subject to special tax rules with respect to any
"excess distribution" that you receive and any gain you realize from a sale or
other disposition, including a pledge, of those shares or equity warrants.
Distributions you receive in a taxable year that are greater than 125% of the
average annual distributions you received during the shorter of the three
preceding taxable years or your holding period for the shares will be treated
as excess distributions. Under these special tax rules

  .  the excess distribution or gain will be allocated ratably over your
     holding period for the shares;

  .  the amount allocated to the current taxable year, and any taxable year
     prior to the first taxable year in which we were a passive foreign
     investment company, will be treated as ordinary income; and

  .  the amount allocated to each other year will be subject to tax at the
     highest tax rate in effect for that year and the interest charge
     generally applicable to underpayments of tax will be imposed on the
     resulting tax attributable to each such year.

   If you hold shares of common stock or shares of preferred stock in any year
in which we are a passive foreign investment company, you are required to file
Internal Revenue Service Form 8621.

   The special passive foreign investment company tax rules described above
will not apply to you if you elect to have us treated as a "qualified electing
fund", which we will refer to as the "QEF election", and we provide certain
information to you. If we are treated as a passive foreign investment company,
we intend to notify you and to provide to you such information as may be
required for you to make the QEF election effective.

   If you make a QEF election, you will be taxable currently on your pro rata
share of our ordinary earnings and net capital gain, at ordinary income and
capital gain rates, respectively, for each taxable year during which we are
treated as a passive foreign investment company, regardless of whether or not
you receive distributions, so that you may recognize taxable income without the
corresponding receipt of cash from us with which to pay your resulting tax
obligation. Your basis in the shares of common stock or shares of preferred
stock will be increased to reflect taxed but undistributed income.
Distributions of income that had previously been taxed will result in a
corresponding reduction of basis in the shares and will not be taxed again as a
distribution to you. Under current law, the QEF election is not available to
holders of warrants.

   Alternatively, if you own shares of common stock or shares of preferred
stock and such stock is treated as "marketable stock", you may make a mark to
market election. If you make such an election, you will not be subject to the
passive foreign investment company rules described above. Instead, in general,
you will include in income each year as ordinary income the excess, if any, of
the fair market value of your marketable stock at the end of the taxable year
over its adjusted basis and will be permitted an ordinary loss in respect of
the excess, if any, of the adjusted basis of such stock over its fair market
value at the end of the taxable year, but only to the extent of the net amount
previously included in income as a result of the mark to market election. Your
basis in the marketable stock will be adjusted to reflect any such income or
loss amounts. Any gain or loss on the sale of the marketable stock will be
ordinary income or loss, except that that loss will be ordinary loss only to
the extent of the previously included net mark to market gain. The mark to
market election is only available with respect to stock that is regularly
traded on certain United States exchanges and other exchanges as indicated in
the appropriate Treasury Regulations. You should consult the applicable
prospectus supplement for information regarding the exchange, if any, upon
which a particular issuance of common stock or preferred stock will be listed.
Under current law, it is unclear whether the warrants will be treated as
marketable stock.

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<PAGE>

   You should consult your own tax advisors concerning the United States
federal income tax consequences of holding shares of common stock, or shares of
preferred stock or equity warrants if we are considered a passive foreign
investment company in any taxable year, including the advisability and
availability of making any of the foregoing elections.

Foreign Personal Holding Company

   If we or one of our non-United States subsidiaries were classified as a
foreign personal holding company, you would be required, regardless of your
percentage ownership, to include in income, as a dividend, your pro rata share
of our or our relevant non-United States subsidiary's undistributed foreign
personal holding company income--generally, taxable income with certain
adjustments--if you held shares of common stock or shares of preferred stock on
the last day of our taxable year or, if earlier, the last day on which we
satisfied the shareholder test described below. In addition, if we were
classified as a foreign personal holding company, and you acquired your shares
of common stock or shares of preferred stock from a decedent, you would not
receive a "stepped-up" basis in that stock. Instead, you would have a tax basis
equal to the lower of the fair market value of those shares or the decedent's
basis in them.

   A foreign corporation will be classified as a foreign personal holding
company if:

     (1) at any time during the corporation's taxable year, five or fewer
  individuals, who are United States citizens or residents, directly or
  indirectly own more than 50% of the corporation's stock, by either voting
  power or value; we will refer to this test as the "shareholder test"; and

     (2) the corporation receives at least 60% of its gross income, 50% after
  the initial year of qualification, in each case as adjusted, for the
  taxable year from certain passive sources; we will refer to this test as
  the "income test".

   It is possible that we and our non-United States subsidiaries could meet the
shareholder test in a given taxable year. It is also possible that we or one of
our non-United States subsidiaries would meet the income test in a given year
and would be treated as a foreign personal holding company. We intend to manage
our affairs so as to attempt to avoid or minimize having income imputed to you
under these rules, to the extent such management of our affairs is consistent
with our business goals, although there can be no assurance in this regard.

Personal Holding Company

   A corporation classified as a personal holding company is subject to a 39.6%
tax on its undistributed personal holding company income. Foreign corporations
determine their liability for personal holding company tax by considering only
(1) gross income derived from United States sources and (2) gross income that
is effectively connected with a United States trade or business. A corporation
will be classified as a personal holding company if (1) at any time during the
last half of the corporation's taxable year, five or fewer individuals own more
than 50% of the corporation's stock (by value) directly or indirectly and (2)
the corporation receives at least 60% of its gross income, as adjusted, from
certain passive sources. However, if a corporation is a foreign personal
holding company or a passive foreign investment company, it cannot be a
personal holding company. It is possible that we and our subsidiaries could
meet the personal holding company shareholder test in a given taxable year. It
is also possible that we or one of our subsidiaries would meet the income test
in a given year and would be treated as a personal holding company. We intend
to manage our affairs so as to attempt to avoid or minimize the imposition of
the personal holding company tax, to the extent such management of our affairs
is consistent with our business goals, although there can be no assurance in
this regard.

Controlled Foreign Corporations

   For the purposes of this paragraph, we will refer to United States persons
that own--or are deemed for United States federal income tax purposes to own,
pursuant to complex attribution and constructive ownership rules--10% or more
of our voting stock or the voting stock of any of our non-United States
subsidiaries as

                                       47
<PAGE>

"10% Shareholders". If 10% Shareholders own, in the aggregate, more than 50%,
measured by voting power or value, of our shares or the shares of any of our
non-United States subsidiaries, directly, indirectly, or by attribution, we or
any such non-United States subsidiary would be a controlled foreign
corporation. If characterized as controlled foreign corporations, then a
portion of our undistributed income may be includible in the taxable income of
our 10% Shareholders, and all or a portion of the gain recognized by such 10%
Shareholders on the disposition of their shares, which could otherwise qualify
for capital gains treatment, may be converted into ordinary dividend income. It
is possible that we and our non-United States corporate subsidiaries may be
controlled foreign corporations or may become controlled foreign corporations
in the future. However, as discussed above, controlled foreign corporation
status generally only has potentially adverse consequences to 10% Shareholders.

Information Reporting and Backup Withholding

   In general, unless you are an exempt recipient such as a corporation,
information reporting will apply to dividends in respect of the shares of
common stock or shares of preferred stock or the proceeds received on the sale,
exchange, or redemption of those shares of common stock, shares of preferred
stock or equity warrants paid to you within the United States and, in some
cases, outside of the United States. Additionally, if you fail to provide your
taxpayer identification number, or fail either to report in full dividend and
interest income or to make certain certifications, you will be subject to
backup withholding at the rate of 31%. Any amounts withheld under the backup
withholding rules will be allowed as a refund or a credit against your United
States federal income tax liability, provided you furnish the required
information to the United States Internal Revenue Service.

                                Debt Securities

Payment of Interest

   Except as provided below, interest on a debt security will generally be
taxable to you as ordinary income at the time it is paid or accrued in
accordance with your method of accounting for tax purposes.

Original Issue Discount

   If you own debt securities issued with original issue discount, which we
refer to as "OID", you will be subject to special tax accounting rules, as
described in greater detail below. In that case, you should be aware that you
generally must include OID in gross income in advance of the receipt of cash
attributable to that income. However, you generally will not be required to
include separately in income cash payments received on the debt securities,
even if denominated as interest, to the extent those payments do not constitute
qualified stated interest, as defined below. Notice will be given in the
applicable prospectus supplement when we determine that a particular debt
security will be an original issue discount debt security.

   A debt security with an issue price that is less than its "stated redemption
price at maturity" (the sum of all payments to be made on the debt security
other than "qualified stated interest") generally will be issued with OID if
that difference is at least 0.25% of the stated redemption price at maturity
multiplied by the number of complete years to maturity. The "issue price" of
each debt security in a particular offering will be the first price at which a
substantial amount of that particular offering is sold to the public. The term
"qualified
stated interest" means stated interest that is unconditionally payable in cash
or in property, other than debt instruments of the issuer, and the interest to
be paid meets all of the following conditions:

  .  it is payable at least once per year;

  .  it is payable over the entire term of the debt security; and

  .  it is payable at a single fixed rate or, subject to certain conditions,
     based on one or more interest indices.

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<PAGE>

   We will give you notice in the applicable prospectus supplement when we
determine that a particular debt security will bear interest that is not
qualified stated interest.

   If you own a debt security issued with de minimis OID, i.e., discount that
is not OID because it is less than 0.25% of the stated redemption price at
maturity multiplied by the number of complete years to maturity, you generally
must include the de minimis OID in income at the time payments, other than
qualified stated interest, on the debt securities are made in proportion to the
amount paid. Any amount of de minimis OID that you have included in income will
be treated as capital gain.

   Certain of the debt securities may contain provisions permitting them to be
redeemed prior to their stated maturity at our option and/or at the option of
the holder. Original issue discount debt securities containing those features
may be subject to rules that differ from the general rules discussed herein. If
you are considering the purchase of original issue discount debt securities
with those features, you should carefully examine the applicable prospectus
supplement and should consult your own tax advisors with respect to those
features since the tax consequences to you with respect to OID will depend, in
part, on the particular terms and features of the debt securities.

   If you own original issue discount debt securities with a maturity upon
issuance of more than one year you generally must include OID in income in
advance of the receipt of some or all of the related cash payments using the
"constant yield method" described in the following paragraph. This method takes
into account the compounding of interest. The accruals of OID on an original
issue discount debt security will generally be less in the early years and more
in the later years.

   The amount of OID that you must include in income if you are the initial
United States holder of an original issue discount debt security is the sum of
the "daily portions" of OID with respect to the debt security for each day
during the taxable year or portion of the taxable year in which you held that
debt security; we will refer to this amount as "accrued OID". The daily portion
is determined by allocating to each day in any "accrual period" a pro rata
portion of the OID allocable to that accrual period. The "accrual period" for
an original issue discount debt security may be of any length and may vary in
length over the term of the debt security, provided that each accrual period is
no longer than one year and each scheduled payment of principal or interest
occurs on the first day or the final day of an accrual period. The amount of
OID allocable to any accrual period is an amount equal to the excess, if any,
of:

  .  the debt security's adjusted issue price at the beginning of the accrual
     period times its yield to maturity, determined on the basis of
     compounding at the close of each accrual period and properly adjusted
     for the length of the accrual period, over

  .  the aggregate of all qualified stated interest allocable to the accrual
     period.

   OID allocable to a final accrual period is the difference between the amount
payable at maturity, other than a payment of qualified stated interest, and the
adjusted issue price at the beginning of the final accrual period. The
"adjusted issue price" of a debt security at the beginning of any accrual
period is equal to its issue price increased by the accrued OID for each prior
accrual period, determined without regard to the amortization of any
acquisition or bond premium, as described below, and reduced by any payments
made on the debt security (other than qualified stated interest) on or before
the first day of the accrual period. Under these rules, you will have to
include in income increasingly greater amounts of OID in successive accrual
periods. We are required
to provide information returns stating the amount of OID accrued on debt
securities held of record by persons other than corporations and other exempt
holders.

   Floating rate debt securities are subject to special OID rules. In the case
of an original issue discount debt security that is a floating rate debt
security, both the "yield to maturity" and "qualified stated interest" will be
determined solely for purposes of calculating the accrual of OID as though the
debt security will bear interest in all periods at a fixed rate generally equal
to the rate that would be applicable to interest payments on the

                                       49
<PAGE>

debt security on its date of issue or, in the case of certain floating rate
debt securities, the rate that reflects the yield to maturity that is
reasonably expected for the debt security. Additional rules may apply if:

  .  the interest on a floating rate debt security is based on more than one
     interest index;

   .  the principal amount of the debt security is indexed in any manner; or

   .  if the debt securities otherwise qualify as "contingent payment debt
instruments".

   This discussion does not address the tax rules applicable to any of these
types of debt securities. If you are considering the purchase of floating rate
original issue discount debt securities, you should carefully examine the
applicable prospectus supplement and should consult your own tax advisors
regarding the United States federal income tax consequences to you of holding
and disposing of those debt securities.

   You may elect to treat all interest on any debt security as OID and
calculate the amount includible in gross income under the constant yield method
described above. For purposes of this election, interest includes stated
interest, acquisition discount, OID, de minimis OID, market discount, de
minimis market discount and unstated interest, as adjusted by any amortizable
bond premium or acquisition premium. You must make this election for the
taxable year in which you acquired the debt security, and you may not revoke
the election without the consent of the Internal Revenue Service. You should
consult with your own tax advisors about this election.

Short-Term Debt Securities

   In the case of debt securities having a term of one year or less, all
payments, including all stated interest, will be included in the stated
redemption price at maturity and will not be qualified stated interest. As a
result, you will generally be taxed on the discount instead of stated interest.
The discount will be equal to the excess of the stated redemption price at
maturity over the issue price of a short-term debt security, unless you elect
to compute this discount using tax basis instead of issue price. In general,
individual and certain other cash method United States holders of short-term
debt securities are not required to include accrued discount in their income
currently unless they elect to do so but may be required to include stated
interest in income as the income is received. United States holders that report
income for United States federal income tax purposes on the accrual method and
certain other United States holders are required to accrue discount on short-
term debt securities (as ordinary income) on a straight-line basis, unless an
election is made to accrue the discount according to a constant yield method
based on daily compounding. If you are not required, and do not elect, to
include discount in income currently, any gain you realize on the sale,
exchange or retirement of a short-term debt security will generally be ordinary
income to you to the extent of the discount accrued by you through the date of
sale, exchange or retirement. In addition, if you do not elect to currently
include accrued discount in income you may be required to defer deductions for
a portion of your interest expense with respect to any indebtedness
attributable to the short-term debt securities.

Market Discount

   If you purchase a debt security, other than an original issue discount debt
security, for an amount that is less than its stated redemption price at
maturity, or, in the case of an original issue discount debt security, its
adjusted issue price, the amount of the difference will be treated as "market
discount" for United States federal income tax purposes, unless that difference
is less than a specified de minimis amount. Under the market discount rules,
you will be required to treat any payment, other than qualified stated
interest, on, or any
gain on the sale, exchange, retirement or other disposition of, a debt security
as ordinary income to the extent of the market discount that you have not
previously included in income and are treated as having accrued on the debt
security at the time of its payment or disposition. In addition, you may be
required to defer, until the maturity of the debt security or its earlier
disposition in a taxable transaction, the deduction of all or a portion of the
interest expense on any indebtedness attributable to the debt security.

   Any market discount will be considered to accrue ratably during the period
from the date of acquisition to the maturity date of the debt security, unless
you elect to accrue on a constant interest method. You may elect

                                       50
<PAGE>

to include market discount in income currently as it accrues, on either a
ratable or constant interest method, in which case the rule described above
regarding deferral of interest deductions will not apply. Your election to
include market discount in income currently, once made, applies to all market
discount obligations acquired by you on or after the first taxable year to
which your election applies and may not be revoked without the consent of the
Internal Revenue Service.

Acquisition Premium, Amortizable Bond Premium

   If you purchase an original issue discount debt security for an amount that
is greater than its adjusted issue price but equal to or less than the sum of
all amounts payable on the debt security after the purchase date other than
payments of qualified stated interest, you will be considered to have purchased
that debt security at an "acquisition premium." Under the acquisition premium
rules, the amount of OID that you must include in gross income with respect to
the debt security for any taxable year will be reduced by the portion of the
acquisition premium properly allocable to that year.

   If you purchase a debt security, including an original issue discount debt
security, for an amount in excess of the sum of all amounts payable on the debt
security after the purchase date other than qualified stated interest, you will
be considered to have purchased the debt security at a "premium" and, if it is
an original issue discount debt security, you will not be required to include
any OID in income. You generally may elect to amortize the premium over the
remaining term of the debt security on a constant yield method as an offset to
interest when includible in income under your regular accounting method. In the
case of instruments that provide for alternative payment schedules, bond
premium is calculated by assuming that (a) you will exercise or not exercise
options in a manner that maximizes your yield, and (b) we will exercise or not
exercise options in a manner that minimizes your yield, except that we will be
assumed to exercise call options in a manner that maximizes your yield. If you
do not elect to amortize bond premium, that premium will decrease the gain or
increase the loss you would otherwise recognize on disposition of the debt
security. Your election to amortize premium on a constant yield method will
also apply to all debt obligations held or subsequently acquired by you on or
after the first day of the first taxable year to which the election applies.
You may not revoke the election without the consent of the Internal Revenue
Service.

Sale, Exchange and Retirement of Debt Securities

   Your tax basis in a debt security will, in general, be your cost for that
debt security, increased by OID, market discount or any discount with respect
to a short-term debt security that you previously included in income, and
reduced by any amortized premium and any cash payments on the debt security
other than qualified stated interest. Upon the sale, exchange, retirement or
other disposition of a debt security, you will recognize gain or loss equal to
the difference between the amount you realize upon the sale, exchange,
retirement or other disposition, less an amount equal to any accrued qualified
stated interest previously includible in income, which will be taxable as such,
and the adjusted tax basis of the debt security. Except as described above with
respect to certain short-term debt securities, with respect to gain or loss
attributable to changes in exchange rates as described below with respect to
certain foreign currency debt securities, which we discuss under "--Foreign
Currency Debt Securities" on page 52, with respect to market discount, or with
respect to gain, and to some extent loss, on contingent payment debt
instruments, which generally are not described herein, that gain or loss will
be United States source capital gain or loss. Capital gains of individuals
derived in respect of capital assets held for more than one year are eligible
for reduced rates of taxation. The deductibility of capital losses is subject
to limitations.

Extendible Debt Securities, Reset Debt Securities and Renewable Debt Securities

   If we specify in an applicable prospectus supplement relating to a debt
security, we or you may have the option to extend the maturity of a debt
security. In addition, we may have the option to reset the interest rate, the
Spread or the Spread Multiplier. If such an option is exercised, your tax
treatment may depend, in part, on the terms, which we refer to as the "revised
terms", established for those debt securities by us as a result of the exercise
of that option. You may be treated for United States federal income tax
purposes as having exchanged

                                       51
<PAGE>

those debt securities, which we will refer to as the "old debt securities", for
new debt securities with the revised terms, which we will refer to as the "new
debt securities". If the exercise of the option by us is not treated as an
exchange of old debt securities for new debt securities, you will not recognize
gain or loss as a result of the exercise. If the exercise of the option is
treated as an exchange of old debt securities for new debt securities, you
would generally realize gain or loss equal to the difference between the issue
price of the new debt securities and your tax basis in the old debt securities.
You will recognize this gain unless the exchange is treated as a tax-free
recapitalization for United States federal income tax purposes.

   The presence of such options may also affect the calculation of OID, among
other things. Solely for purposes of the accrual of OID, if we have an option
or combination of options to extend the term of the debt securities, we will be
presumed to exercise such option or options in the manner that minimizes the
yield on the debt securities. Conversely, if you have a put option, an option
to extend the term of the debt securities or a combination of such options, you
will be presumed to exercise such option or options in a manner that maximizes
the yield on the debt securities. If the exercise of that option or options to
extend the term of the debt securities actually occurs or the option to put
does not occur contrary to the presumption made under applicable Treasury
regulations--we will cal this a "change of circumstances"--then, solely for
purposes of the accrual of OID, the debt securities will be treated as reissued
on the date of the change in circumstances for an amount equal to their
adjusted issue price on that date. You should carefully examine the applicable
prospectus supplement and should consult your own tax advisors regarding the
United States federal income tax consequences of holding and disposing of
extendible debt securities, reset debt securities and renewable debt
securities.

Foreign Currency Debt Securities

   The following is a summary of the principal United States federal income tax
consequences to you if you own a debt security denominated in a specified
currency other than the United States dollar, which we will refer to as a
"foreign currency debt security".

 Interest Payments

   If you are a cash basis taxpayer, you are required to include in income the
United States dollar value of interest payments you receive, based on the
exchange rate in effect on the date of receipt, regardless of whether you
convert such interest payments into United States dollars. You will not
recognize exchange gain or loss upon the receipt of such payment.

   If you are an accrual basis taxpayer, you may determine the amount of income
you recognize with respect to such interest payment in accordance with either
of two methods. Under the first method, you will be required to include in
income for each taxable year the United States dollar value of the interest
that has accrued during the year, determined by translating such interest at
the average rate of exchange for the period or periods during which such
interest accrued. Under the second method, you may elect to translate interest
income at the spot rate on the last day of the accrual period, or last day of
the taxable year in the case of an accrual period that straddles your taxable
year, or on the date you receive the interest payment if such date is within
five days of the end of the accrual period. When you receive an interest
payment, including a payment attributable to accrued but unpaid interest on the
sale or other disposition of a debt security, on a debt security, you will
recognize ordinary income or loss in an amount equal to the difference between
the United States dollar value of such payment, determined by translating any
foreign currency received at the "spot rate" for such foreign currency on the
date received, and the United States dollar value of the interest income that
you have previously included in income with respect to such payment.

 Foreign Currency Original Issue Discount Debt Securities

   OID on a debt security that is also a foreign currency debt security will be
determined for any accrual period in the applicable foreign currency and then
translated into United States dollars in the same manner as interest income
accrued by a holder on the accrual basis, as described above. Additionally, you
will recognize

                                       52
<PAGE>

exchange gain or loss when the OID is paid, including a payment attributable to
OID upon the sale or other disposition of a foreign currency debt security, to
the extent of the difference between the United States dollar value of such
payment, determined by translating any foreign currency received at the spot
rate for such foreign currency on the date of payment, and the United States
dollar value of the accrued OID, determined in the same manner as for accrued
interest.

 Market Discount

   You will determine market discount on foreign currency debt securities
includible in income by translating the market discount determined in the
foreign currency into United States dollars at the spot rate on the date the
foreign currency debt security is retired or you otherwise dispose of the debt
security. If you have elected to accrue market discount currently, then the
amount you accrue is determined in the foreign currency and then translated
into United States dollars on the basis of the average exchange rate in effect
during the accrual period. You will recognize exchange gain or loss with
respect to market discount you accrue currently using the approach applicable
to the accrual of interest income as described above.

 Amortizable Bond Premium

   You will compute bond premium on a foreign currency debt security in the
applicable foreign currency. If you elect to amortize the premium, the
amortizable bond premium will reduce interest income in the applicable foreign
currency. At the time bond premium is amortized, you will realize exchange gain
or loss, which is generally ordinary income or loss, based on the difference
between spot rates at such time and at the time of acquisition of the foreign
currency debt security. If you do not elect to amortize bond premium, you will
translate the bond premium, computed in the applicable foreign currency, into
United States dollars at the spot rate on the maturity date and such bond
premium will constitute a capital loss which may be offset or eliminated by
exchange gain.

 Sale or Other Disposition of Foreign Currency Debt Security

   Your tax basis in a foreign currency debt security will be the United States
dollar value of the foreign currency amount you paid for such foreign currency
debt security determined at the time of your purchase. If you purchase a debt
security with previously owned foreign currency, you will recognize exchange
gain or loss at the time of purchase attributable to the difference at the time
of purchase, if any, between your tax basis in such foreign currency and the
fair market value of the debt security in United States dollars on the date of
purchase. Such gain or loss will be ordinary income or loss.

   For purposes of determining the amount of any gain or loss you will
recognize on the sale, exchange, retirement or other disposition of a foreign
currency debt security, the amount realized upon such sale, exchange,
retirement or other disposition will be the United States dollar value of the
amount realized in foreign currency, other than amounts attributable to accrued
but unpaid interest not previously included in the holder's income, determined
at the time of the sale, exchange, retirement or other disposition.

   You will recognize exchange gain or loss attributable to the movement in
exchange rates between the time of purchase and the time of sale, exchange,
retirement or other disposition of a foreign currency debt security. Such gain
or loss will be treated as ordinary income or loss. Your realization of such
gain or loss will be limited to the amount of overall gain or loss realized on
your sale of a foreign currency debt security. Under proposed Treasury
Regulations issued on March 17, 1992, if a foreign currency debt security is
denominated in one of certain hyperinflationary currencies, generally (1) you
would realize exchange gain or loss with respect to movements in the exchange
rate between the beginning and end of each taxable year, or such shorter period,
that you held the debt security and (2) you would treat the exchange gain or
loss as an addition or offset, respectively, to the accrued interest income on,
and an adjustment to the holder's tax basis in, the foreign currency debt
security.


                                       53
<PAGE>

 Exchange Gain or Loss With Respect to Foreign Currency

   Your tax basis in foreign currency received as interest on, or OID with
respect to, or received on the sale, exchange, retirement or other disposition
of, a foreign currency debt security will be the United States dollar value
thereof at the spot rate at the time you receive such foreign currency. Gain or
loss you recognize on a sale, exchange, retirement or other disposition of
foreign currency will be ordinary income or loss and will not be treated as
interest income or expense, except to the extent provided in Treasury
Regulations or administrative pronouncements of the Internal Revenue Service.

Indexed Debt Securities

   If you purchase an indexed debt security, or a security that otherwise
qualifies as a contingent payment debt instrument, your tax treatment will
depend on factors including the specific index or indices used to determine
indexed payments on the debt security and the amount and timing of any
contingent payments of principal and interest. If you are considering
purchasing indexed debt securities, you should carefully examine the applicable
prospectus supplement and should consult your own tax advisor regarding the
United States federal income tax consequences of holding and disposing of such
debt securities.

Information Reporting and Backup Withholding

   In general, unless you are an exempt recipient such as a corporation,
information reporting will apply to certain payments of principal, interest,
OID and premium paid on debt securities and to the proceeds of sale of a debt
security. Additionally, if you fail to provide your taxpayer identification
number, or in the case of interest payments, fail either to report in full
dividend and interest income or to make certain certifications, you will be
subject to backup withholding at a 31% rate. Any amounts withheld under the
backup withholding rules will be allowed as a refund or a credit against your
United States federal income tax liability, provided you furnish the required
information to the Internal Revenue Service.

                                    Warrants

Equity Warrants

   You will generally not recognize any gain or loss upon the exercise of
equity warrants except with respect to cash received in lieu of a fractional
share of common or preferred stock. You will have an initial tax basis in the
shares of common or preferred stock received on exercise of the equity warrants
equal to the sum of your tax basis in the equity warrants and the aggregate
cash exercise price paid in respect of such exercise. Your holding period in
the shares of common or preferred stock received on exercise of the equity
warrants will commence on the date after the equity warrants are exercised.

   If an equity warrant expires without being exercised, you will recognize a
capital loss in an amount equal to your tax basis in the equity warrant. Upon
the sale or exchange of an equity warrant, you will generally recognize a
capital gain or loss equal to the difference, if any between the amount
realized on such sale or exchange and your tax basis in such equity warrant.

   Under Section 305 of the Code, you may be deemed to have received a
constructive distribution from us, which may result in the inclusion of
ordinary dividend income, in the event of certain adjustments, or the failure
to make certain adjustments, to the number of shares of common or preferred
stock to be issued upon exercise of an equity warrant.

Debt Warrants

   If a decision is made to issue debt warrants, we will discuss the relevant
income tax consequences in the applicable prospectus supplement.

                                       54
<PAGE>


                           SELLING SHAREHOLDERS

   The selling shareholders may be our directors, executive officers, former
directors, employees or holders of our common stock. The prospectus supplement
for any offering of the common stock by selling shareholders will include the
following information:

  .  the names of the selling shareholders;

  .  the nature of any position, office or other material relationship which
     each selling shareholder has had within the last three years with us or
     any of our predecessors or affiliates;

  .  the number of shares held by each of the selling shareholders before the
     offering;

  .  the percentage of the common stock held by each of the selling
     shareholders after the offering; and

  .  the number of shares of our common stock offered by each of the selling
     shareholders.


                                       55
<PAGE>

                              PLAN OF DISTRIBUTION

   We may sell our debt securities, shares of preferred stock, shares of common
stock and warrants in any of three ways:

  .  through underwriters;

  .  through agents; or

  .  directly to a limited number of institutional purchasers or to a single
     purchaser.

   In addition, some of our shareholders may sell shares of our common stock
under this prospectus in any of the ways we describe immediately above.

   The prospectus supplement for the securities we or any selling shareholders
sell will describe that offering, including:

  .  the name or names of any underwriters;

  .  the purchase price and the proceeds to us or the selling shareholders
     from that sale;

  .  any underwriting discounts and other items constituting underwriters'
     compensation;

  .  any initial public offering price and any discounts or concessions
     allowed or reallowed or paid to dealers; and

  .  whether the securities will trade on any securities exchanges or the
     Nasdaq National Market.

Underwriters

   If underwriters are used in the sale, we and any selling shareholders will
execute an underwriting agreement with those underwriters relating to the
securities that we and any selling shareholders will offer. Unless otherwise
provided in the prospectus supplement, the obligations of the underwriters to
purchase these securities will be subject to conditions. The underwriters will
be obligated to purchase all of these securities if any are purchased.

   The securities subject to the underwriting agreement will be acquired by the
underwriters for their own account and may be resold by them from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Underwriters may be deemed to have received compensation from us and any
selling shareholders in the form of underwriting discounts or commissions and
may also receive commissions from the purchasers of these securities for whom
they may act as agent. Underwriters may sell these securities to or through
dealers. These dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters and/or commissions from the
purchasers for whom they may act as agent. Any initial public offering price
and any discounts or concessions allowed or reallowed or paid to dealers may be
changed from time to time.

   We and any selling shareholders also may sell the securities in connection
with a remarketing upon their purchase, in connection with a redemption or
repayment, by a remarketing firm acting as principal for its own account or as
our or any selling shareholders' agent. Remarketing firms may be deemed to be
underwriters in connection with the securities that they remarket.

   We and any selling shareholders may authorize underwriters to solicit offers
by institutions to purchase the securities subject to the underwriting
agreement from us or any selling shareholders at the public offering price
stated in the prospectus supplement under delayed delivery contracts providing
for payment and delivery on a specified date in the future. If we or any
selling shareholders sell securities under these delayed delivery contracts,
the prospectus supplement will state that as well as the conditions to which
these delayed delivery contracts will be subject and the commissions payable
for that solicitation.

                                       56
<PAGE>

Agents

   We and any selling shareholders may also sell any of the securities through
agents designated by us or any selling shareholders from time to time. We will
name any agent involved in the offer or sale of these securities and will list
commissions payable by us or any selling shareholders to these agents in the
prospectus supplement. These agents will be acting on a best efforts basis to
solicit purchases for the period of their appointment, unless we state
otherwise in the prospectus supplement.

Direct Sales

   We and any selling shareholders may sell any of the securities directly to
purchasers. In this case, neither we nor those selling shareholders will engage
underwriters or agents in the offer and sale of these securities.

Indemnification

   We and any selling shareholders may indemnify underwriters, dealers or
agents who participate in the distribution of the securities against certain
liabilities, including liabilities under the Securities Act, and agree to
contribute to payments which these underwriters, dealers or agents may be
required to make.

                                       57
<PAGE>

                                 LEGAL MATTERS

   Certain Bermuda legal matters with respect to the securities will be passed
upon for us by Appleby, Spurling & Kempe. As of January 14, 2000, lawyers of
Appleby, Spurling & Kempe who have participated in the preparation of this
document beneficially owned approximately 4,000 shares of our common stock.

                                    EXPERTS

   The consolidated financial statements of Global Crossing and its
subsidiaries incorporated by reference in this prospectus and elsewhere in the
registration statement have been audited by Arthur Andersen, independent public
accountants, as indicated in their reports with respect thereto, and are
incorporated by reference in reliance upon the authority of said firm as
experts in giving said reports.

   The consolidated financial statements incorporated by reference in this
Registration Statement of which this prospectus is a part to the Annual Report
on Form 10-K of Frontier Corporation for the year ended December 31, 1998 and
audited historical financial statements included on pages 22-42 of Frontier
Corporation's Form 8-K dated January 26, 1999, have been so incorporated in
reliance on the reports of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.

   The combined financial statements of Global Marine Systems incorporated by
reference in this prospectus have been incorporated by reference in reliance
upon the report of KPMG Audit Plc, chartered accountants, incorporated by
reference in this prospectus and upon the authority of said firm as experts in
accounting and auditing.

   The financial statements of Racal Telecom incorporated by reference in this
registration statement of which this prospectus is a part have been audited by
Deloitte & Touche, independent auditors, as stated in their report incorporated
by reference in this registration statement of which this prospectus is a part.

   The consolidated financial statements incorporated by reference in this
registration statement of which this prospectus is a part of HCL Holdings
Limited and subsidiaries have been so incorporated in reliance on the reports
of PricewaterhouseCoopers, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

               SERVICE OF PROCESS AND ENFORCEMENT OF LIABILITIES

   We are organized under the laws of Bermuda. In addition, a number of our
directors and officers reside outside of the United States and a substantial
portion of our assets are located outside of the United States. As a result, it
may be difficult for you to effect service of process within the United States
upon those persons or to realize against them in courts of the United States
upon judgments of courts of the United States predicated upon civil liabilities
under the United States federal securities laws. Furthermore, our Bermuda
counsel, Appleby Spurling & Kempe, has advised us that there is doubt as to the
enforcement in Bermuda, in original actions or in actions of enforcement of
judgments of United States courts, of liabilities predicated upon United States
federal securities laws, although Bermuda courts will enforce foreign judgments
for liquidated amounts in civil matters subject to some conditions and
exceptions.

                                       58
<PAGE>

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


                                 $8,000,000,000



                                Debt Securities
                                Preferred Stock
                                  Common Stock
                                    Warrants


                          [LOGO] Global Crossing Ltd.


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

                                   PROSPECTUS

                                       , 2000

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


- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

                                    PART II

Item 14. Other Expenses of Issuance and Distribution.

   The registrant estimates that expenses in connection with the offering
described in this Registration Statement will be as follows:

<TABLE>
      <S>                                                            <C>
      SEC registration fee.......................................... $2,112,000
      Nasdaq National Market listing fee............................     53,000
      Bermuda Stock Exchange listing fee............................     40,000
      Printing and engraving expenses...............................  1,500,000
      Legal fees and expenses.......................................  1,000,000
      Accounting fees and expenses..................................    500,000
      Blue Sky fees and expenses....................................     15,000
      Transfer agent, registrar and trustee fees....................     45,000
      Miscellaneous.................................................     85,000
                                                                     ----------
        Total....................................................... $5,350,000
</TABLE>

Item 15. Indemnification of Directors and Officers.

   The Bye-laws of the Registrant provide for indemnification of the
Registrant's officers and directors against all liabilities, loss, damage or
expense incurred or suffered by such party as an officer or director of the
Registrant; provided that such indemnification shall not extend to any matter
which would render it void pursuant to the Companies Act of 1981 as in effect
from time to time in Bermuda.

   The Companies Act provides that a Bermuda company may indemnify its
directors in respect of any loss arising or liability attaching to them as a
result of any negligence, default, breach of duty or breach of trust of which
they may be guilty. However, the Companies Act also provides that any
provision, whether contained in the company's bye-laws or in a contract or
arrangement between the company and the director, indemnifying a director
against any liability which would attach to him in respect of his fraud or
dishonesty will be void.

   The directors and officers of the Registrant are covered by directors' and
officers' insurance policies maintained by the Registrant.

Item 16. Exhibits.

   The following is a complete list of Exhibits filed as part of this
Registration Statement, which are incorporated herein:

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 1.1     Form of Underwriting Agreement for [Common Stock] [Preferred Stock]
         (filed herewith).
 1.2     Form of Underwriting Agreement for [Convertible] [Senior]
         [Subordinated] Debt Securities (previously filed with this
         Registration Statement).
 2.1     Agreement and Plan of Merger, dated as of March 16, 1999 (the
         "Frontier Merger Agreement"), among the Registrant, Frontier
         Corporation and GCF Acquisition Corp. (incorporated by reference to
         Exhibit 2 to the Registrant's Current Report on Form 8-K filed on
         March 19, 1999 (the "March 19, 1999 8-K")).
 2.2     Consent and Amendment No. 1 to the Frontier Merger Agreement, dated as
         of May 16, 1999, among the Registrant, GCF Acquisition Corp. and
         Frontier Corporation (incorporated by reference to Exhibit 2 to the
         Registrant's Current Report on Form 8-K filed on May 18, 1999 (the
         "May 18, 1999 8-K")).
</TABLE>


                                      II-1
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 2.3     Amendment No. 2 to the Frontier Merger Agreement, dated as of
         September 2, 1999, among the Registrant, GCF Acquisition Corp. and
         Frontier Corporation (incorporated by reference to Exhibit 2 to the
         Registrant's Current Report on Form 8-K filed on September 3, 1999
         (the "September 3, 1999 8-K")).
 2.4     Sale and Purchase Agreement, dated as of April 26, 1999, between Cable
         & Wireless plc and the Registrant (incorporated by reference to
         Exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on
         July 16, 1999 (the "July 16, 1999 8-K")).
 2.5     Amendment to the Sale and Purchase Agreement, dated as of June 25,
         1999, between Cable & Wireless plc and the Registrant (incorporated by
         reference to Exhibit 2.2 to the July 16, 1999 8-K).
 2.6     Agreement and Plan of Merger, dated as of May 16, 1999, between the
         Registrant and U S West, Inc. (incorporated by reference to Exhibit 2
         to the Registrant's Current Report on Form 8-K filed on May 21, 1999
         (the "May 21, 1999 8-K")).
 2.7     Letter Agreement, dated as of May 16, 1999, between the Registrant and
         U S West, Inc. (incorporated by reference to Exhibit 99 to the May 21,
         1999 8-K).
 2.8     Termination Agreement, dated as of July 18, 1999, between the
         Registrant and U S West, Inc. (incorporated by reference to Exhibit
         10.1 to the Registrant's Current Report on Form 8-K filed on July 20,
         1999 (the "July 20, 1999 8-K")).
 2.9     Agreement and Plan of Merger, dated as of February 22, 2000, among the
         Registrant, Georgia Merger Sub Corporation, IPC Communications, Inc.,
         IPC Information Systems, Inc., Idaho Merger Sub Corporation and IXnet,
         Inc. (incorporated by reference to Exhibit 2.10 to Registrant's annual
         report on Form 10-K for the year ended December 31, 1999).
 3.1     Memorandum of Association of the Registrant (incorporated by reference
         to Exhibit 3.1 to the Registrant's Registration Statement on Form S-
         1/A filed on July 2, 1998 (the "July 2, 1998 S-1/A")).
 3.2     Certificate of Incorporation of Change of Name of the Registrant dated
         April 30, 1998 (incorporated by reference to Exhibit 3.3 to the
         Registrant's Registration Statement on Form S-1/A filed on July 23,
         1998 (the "July 23, 1998 S-1/A")).
 3.3     Memorandum of Increase of Share Capital of the Registrant dated July
         9, 1998 (incorporated by reference to Exhibit 3.4 to the July 23, 1998
         S-1/A).
 3.4     Memorandum of Increase of Share Capital of the Registrant dated
         September 27, 1999 (incorporated by reference to Exhibit 3.1 to the
         Registrant's Quarterly Report on Form 10-Q filed on November 15, 1999
         (the "November 15, 1999 10-Q")).
 3.5     Bye-laws of the Registrant as in effect on October 14, 1999
         (incorporated by reference to Exhibit 3.2 to the November 15, 1999 10-
         Q).
 3.6     Certificate of Designations of 6 3/8% Cumulative Convertible Preferred
         Stock of the Registrant dated November 5, 1999 (incorporated by
         reference to Exhibit 3.3 to the November 15, 1999 10-Q).
 3.7     Certificate of Designations of 7% Cumulative Convertible Preferred
         Stock of the Registrant, dated December 15, 1999 (incorporated by
         reference to Exhibit 3.9 to the Global Crossing Holdings Ltd.
         Registration Statement on Form S-4 filed on January 11, 2000 (File No.
         333-94449)).
 3.8     Certificate of Designations of 6 3/8% Cumulative Convertible Preferred
         Stock, Series B, of the Registrant, dated January 12, 2000
         (incorporated by reference to Registrant's annual report on Form 10-K
         for the year ended December 31, 1999).
 4.1     Certificate of Designations of 10 1/2% Senior Exchangeable Preferred
         Stock Due 2008 of Global Crossing Holdings Ltd. dated December 1, 1998
         (incorporated by reference to Schedule A to Exhibit 3.2 to the Global
         Crossing Holdings Ltd. Registration Statement on Form S-4 filed on
         December 22, 1998.)
 4.2     Indenture, dated as of May 18, 1998, between Global Crossing Holdings
         Ltd. and United States Trust Company of New York, as Trustee
         (incorporated by reference to Exhibit 4.2 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on December 22,
         1998).
</TABLE>

                                      II-2
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 4.3     Supplemental Indenture, dated as of June 25, 1999, between Global
         Crossing Holdings Ltd. and United States Trust Company of New York, to
         the Indenture dated as of May 18, 1998 (incorporated by reference to
         Exhibit 4.4 to the Registrant's Registration Statement on Form S-4
         filed on July 12, 1999).
 4.4     Credit Agreement, dated as of July 2, 1999, among the Registrant,
         Global Crossing Holdings Ltd., the Lenders party thereto and The Chase
         Manhattan Bank as Administrative Agent (incorporated by reference to
         Exhibit 10.7 to the Registrant's Registration Statement on Form S-4/A
         filed on August 5, 1999).
 4.5     Indenture, dated as of November 19, 1999, among Global Crossing Ltd.,
         Global Crossing Holdings Ltd. and United States Trust Company of New
         York (incorporated by reference to Exhibit 4.5 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on January 11,
         2000 (File No. 333-94449)).
         Except as hereinabove provided, there is no instrument with respect to
         long-term debt of the Registrant and its consolidated subsidiaries
         under which the total authorized amount exceeds 10 percent of the
         total consolidated assets of the Registrant. The Registrant agrees to
         furnish to the SEC upon its request a copy of any instrument relating
         to long-term debt.
 4.6     Form of Indenture between the Registrant and United States Trust
         Company of New York, as Trustee (previously filed with this
         Registration Statement).
 4.7     Form of Certificate of Designations, Powers, Preferences and Rights
         for Preferred Stock (previously filed with this Registration
         Statement).
 4.8     Form of Common Stock Certificate. (The Form of Common Stock
         Certificate included as Exhibit 4.1 to the Registrant's registration
         statement on Form S-1 filed on July 23, 1998 is hereby incorporated
         herein by reference.)
 4.9     Form of Preferred Stock Certificate (previously filed with this
         Registration Statement).
 4.10    Form of Debt Warrant Agreement (previously filed with this
         Registration Statement).
 4.11    Form of Equity Warrant Agreement (previously filed with this
         Registration Statement).
 4.12    Form of Debt Security (previously filed with this Registration
         Statement).
 5.1     Opinion of Appleby, Spurling & Kempe (previously filed with this
         Registration Statement).
 10.1    Project Development and Construction Contract, dated as of March 18,
         1997, among AT&T Submarine Systems, Inc. and Atlantic Crossing Ltd.
         (formerly Global Telesystems Ltd.) (incorporated by reference to
         Exhibit 10.2 to the July 23, 1998 S-1/A).
 10.2    Project Development and Construction Contract, dated as of April 21,
         1998, among Tyco Submarine Systems, Ltd. and Pacific Crossing Ltd.
         (incorporated by reference to Exhibit 10.3 to the July 23, 1998 S-
         1/A).
 10.3    Project Development and Construction Contract, dated as of June 2,
         1998, among Alcatel Submarine Networks and Mid-Atlantic Crossing Ltd.
         (incorporated by reference to Exhibit 10.4 to the July 23, 1998 S-
         1/A).
 10.4    Project Development and Construction Contract, dated as of July 21,
         1998, among Tyco Submarine Systems, Ltd. and Pan American Crossing
         Ltd. (incorporated by reference to Exhibit 10.5 to the Registrant's
         Quarterly Report on Form 10-Q filed on November 16, 1998).
 10.5    Project Development and Construction Contract, dated as of July 30,
         1999, among Alcatel Submarine Networks and South American Crossing
         Ltd. (incorporated by reference to Exhibit 10.5 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on January 11,
         2000 (File No. 333-94449) (portions have been omitted pursuant to a
         request for confidential treatment).
</TABLE>

                                      II-3
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 10.6    Lease made as of October 1, 1999 between North Crescent Realty V, LLC
         and Global Crossing Development Company (incorporated by reference to
         Exhibit 10.1 to the November 15, 1999 10-Q).
 10.7    Form of Stockholders Agreement dated as of August 12, 1998 among the
         Registrant and the investors named therein (incorporated by reference
         to Exhibit 9.1 to the July 23, 1998 S-1/A).
 10.8    Form of Registration Rights Agreement dated as of August 12, 1998
         among the Registrant and the investors named therein (incorporated by
         reference to Exhibit 4.4 to the July 23, 1998 S-1/A).
 10.9    Voting Agreement, dated as of March 16, 1999, among certain
         shareholders of the Registrant parties thereto, Frontier Corporation
         and, for certain purposes only, the Registrant (incorporated by
         reference to Exhibit 10.2 to the March 19, 1999 8-K).

 10.10   Second Reaffirmation of Voting Agreement and Share Transfer
         Restriction Agreement, dated as of September 2, 1999 (incorporated by
         reference to Annex S-B to the joint proxy statement/prospectus
         supplement included in the Registrant's Registration Statement on Form
         S-4 filed on September 8, 1999 (the "September 8, 1999 S-4").
 10.11   Share Transfer Restriction Agreement, dated as of September 2, 1999,
         among certain shareholders of Global Crossing Ltd., certain
         shareholders of Frontier Corporation and Global Crossing Ltd.
         (incorporated by reference to Annex S-C to the joint proxy
         statement/prospectus supplement included in the September 8, 1999 S-
         4).
 10.12   Tender Offer and Purchase Agreement, dated as of May 16, 1999, between
         the Registrant and U S WEST, Inc. (incorporated by reference to
         Exhibit (c)(2) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21,
         1999).
 10.13   Standstill Agreement dated as of May 16, 1999 between U S WEST, Inc.
         and the Registrant (incorporated by reference to Exhibit (c)(4) to U S
         WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.14   Voting Agreement dated as of May 16, 1999 between U S WEST, Inc. and
         the Registrant (incorporated by reference to Exhibit (c)(3) to U S
         WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.15   Tender and Voting Agreement dated as of May 16, 1999 among U S WEST,
         Inc., the Registrant and the shareholders party thereto (incorporated
         by reference to Exhibit (c)(5) to U S WEST, Inc.'s Schedule 14D-1
         filed on May 21, 1999).
 10.16   Agreement dated as of May 16, 1999 among the Registrant and the
         shareholders party thereto (incorporated by reference to Exhibit
         (c)(6) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.17   Transfer Agreement dated as of May 16, 1999 among the Registrant and
         the shareholders party thereto (incorporated by reference to Exhibit
         (c)(8) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.18   Amendment No. 1 dated as of July 18, 1999 to Tender Offer and Purchase
         Agreement dated as of May 16 1999 between the Registrant and U S WEST,
         Inc. (incorporated by reference to Exhibit 10.2 to the July 20, 1999
         8-K).
 10.19   Agreement, dated as of July 18, 1999, between Qwest Communications
         International Inc. and the Registrant (incorporated by reference to
         Exhibit 10.3 to the July 20, 1999 8-K).
 10.20   Agreement, dated as of July 18, 1999, between Global Crossing Holdings
         Ltd. and Qwest Communications International Inc. (incorporated by
         reference to Exhibit 10.4 to the July 20, 1999 8-K).
 10.21   Registration Rights Agreement, dated as of November 5, 1999, among the
         Registrant and the initial purchasers of the Registrant's 6 3/8%
         Cumulative Convertible Preferred Stock named therein (incorporated by
         reference to Exhibit 10.21 to the Registrant's Registration Statement
         on Form S-3 (File No. 333-94805) filed on January 18, 2000).
</TABLE>


                                      II-4
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 10.22   1998 Global Crossing Ltd. Stock Incentive Plan, as amended and
         restated effective December 7, 1999 (incorporated by reference to
         Exhibit 10.21 to the Global Crossing Holdings Ltd. Registration
         Statement on Form S-4 filed on January 11, 2000 (File No. 333-94449)).
 10.23   Form of Non-Qualified Stock Option Agreement as in effect on September
         30, 1999 (incorporated by reference to Exhibit 10.2 to the November
         15, 1999 10-Q).
 10.24   Frontier Corporation Supplemental Retirement Savings Plan as amended
         and restated effective January 1, 1996 (incorporated by reference to
         Exhibit 10.13 to Frontier Corporation's Annual Report on Form 10-K
         filed March 28, 1997).
 10.25   Amendment No. 1, effective March 16, 1999, to Frontier Corporation
         Supplemental Retirement Savings Plan (incorporated by reference to
         Exhibit 10.2 to Frontier Corporation's Quarterly Report on Form 10-Q
         filed August 3, 1999).
 10.26   Amendment No. 2, dated September 21, 1999, to Frontier Corporation
         Supplemental Retirement Savings Plan (incorporated by reference to
         Exhibit 10.5 to the November 15, 1999 10-Q).
 10.27   Employment Agreement dated as of February 19, 1999 between the
         Registrant and Robert Annunziata (incorporated by reference to Exhibit
         10.8 to the Registrant's Quarterly Report on Form 10-Q filed on May
         10, 1999).
 10.28   Executive Contract dated January 1, 1998 between Joseph P. Clayton and
         Frontier Corporation (incorporated by reference to Exhibit 10.22 to
         Frontier Corporation's Annual Report on Form 10-K filed March 26,
         1998).
 10.29   Amendment dated May 1, 1999 to Executive Contract between Joseph P.
         Clayton and Frontier Corporation (incorporated by reference to Exhibit
         10.9 to the November 15, 1999 10-Q).
 10.30   Sale Agreement, dated October 10, 1999, among Controls and
         Communications Limited, The Racal Corporation, Racal Electronics plc
         and the Registrant (incorporated by reference to Exhibit 2.1 of the
         Registrant's Current Report on Form 8-K filed on October 21, 1999).
 10.31   Subscription and Sale and Purchase Agreement, dated November 15, 1999,
         among Hutchison Whampoa Limited, Hutchison Telecommunications Limited,
         the Registrant and HCL Holdings Limited (incorporated by reference to
         Exhibit 10.33 to the Global Crossing Holdings Ltd. Registration
         Statement on Form S-4 filed on January 11, 2000 (File No. 333-94449)).
 10.32   Registration Rights Agreement, dated as of December 15, 1999, among
         the Registrant and the initial purchasers of the Registrant's 7%
         Cumulative Convertible Preferred Stock named therein (incorporated by
         reference to Exhibit 10.21 to the Registrant's Registration Statement
         on Form S-3 (File No. 333-94803) filed on January 18, 2000).
 10.33   Employment Agreement, dated as of December 5, 1999, between the
         Registrant and Leo J. Hindery, Jr. (incorporated by reference to
         Exhibit 10.32 to the Registrant's annual report on Form 10-K for the
         year ended December 31, 1999).
 10.34   Form of Change in Control Agreement between the Registrant and
         Executive Officers of the Registrant approved by the Board of
         Directors in January 2000 (incorporated by reference to Exhibit 10.33
         to the Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
 10.35   Employment Agreement, dated as of December 3, 1999, between the
         Registrant and John A. Scarpati (incorporated by reference to Exhibit
         10.36 to Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
 12.1    Statement of Computation of Earnings to Fixed Charges (incorporated by
         reference to Exhibit 12.1 to Registrant's annual report on Form 10-K
         for the year ended December 31, 1999).
 21.1    Subsidiaries of the Registrant (incorporated by reference to Exhibit
         21.1 to Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
</TABLE>


                                      II-5
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                        Exhibit Description
 -------                       -------------------
 <C>     <S>
 23.1    Consent of Arthur Andersen (filed herewith).
 23.2    Consent of PricewaterhouseCoopers LLP (filed herewith).
 23.3    Consent of KPMG Audit Plc (filed herewith).
 23.4    Consent of Deloitte & Touche (filed herewith).
 23.5    Consent of PricewaterhouseCoopers (filed herewith).
 23.6    Consent of Appleby, Spurling & Kempe (included in Exhibit 5.1).
 24.1    Power of Attorney of the Registrant (previously filed with this
         Registration Statement).
</TABLE>

Item 17. Undertakings.

   (1) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed to be
the initial bona fide offering thereof.

   (2) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

   (3) The undersigned registrant hereby undertakes:

     (a) To file, during any period in which offers or sales are being made,
  a post-effective amendment to this registration statement:

        (i) To include any prospectus required by Section 10(a)(3) of the
    Securities Act;

         (ii) To reflect in the prospectus any facts or events arising
    after the effective date of the Registration Statement (or the most
    recent post-effective amendment thereof) which, individually or in the
    aggregate, represent a fundamental change in the information set forth
    in the Registration Statement. Notwithstanding the foregoing, any
    increase or decrease in volume of securities offered (if the total
    dollar value of securities offered would not exceed that which was
    registered) and any deviation from the low or high end of the estimated
    maximum offering range may be reflected in the form of prospectus filed
    with the Commission pursuant to Rule 424(b) if, in the aggregate, the
    changes in volume and price represent no more than a 20 percent change
    in the maximum aggregate offering price set forth in the "Calculation
    of Registration Fee" table in the effective Registration Statement; and

          (iii) To include any material information with respect to the
    plan of distribution not previously disclosed in the Registration
    Statement or any material change to such information in the
    Registration Statement;

                                      II-6
<PAGE>

     (b) To remove from registration by means of a post-effective amendment
  any of the securities being registered which remain unsold at the
  termination of the offering.

     (c) For purposes of determining any liability under the Securities Act
  of 1933, the information omitted from the form of prospectus filed as part
  of this registration statement in reliance upon Rule 430A and contained in
  a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
  (4) or 497(h) under the Securities Act shall be deemed to be part of this
  registration statement as of the time it was declared effective.

     (d) For the purpose of determining any liability under the Securities
  Act of 1933, each post-effective amendment that contains a form of
  prospectus shall be deemed to be a new registration statement relating to
  the securities offered therein, and the offering of such securities at that
  time shall be deemed to be the initial bona fide offering thereof.

                                      II-7
<PAGE>

                                   SIGNATURES

   Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Los Angeles, State of California, on March 31, 2000.

                                          Global Crossing Ltd.

                                          By:         /s/ Dan J. Cohrs
                                             ----------------------------------
                                             Name: Dan J. Cohrs
                                             Title: Senior Vice President and
                                             Chief FinancialOfficer

                               POWER OF ATTORNEY

   Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
                 Signature                           Capacity                Date
                 ---------                           --------                ----
<S>                                         <C>                        <C>


                    /*/                     Chairman of the Board and   March 31, 2000
___________________________________________  Director
               Gary Winnick

                    /*/                     Co-Chairman of the Board    March 31, 2000
___________________________________________  and Director
             Lodwrick M. Cook

                    /*/                     Vice Chairman of the Board  March 31, 2000
___________________________________________  and Director
              Thomas J. Casey

                    /*/                     Director; Vice Chairman of  March 31, 2000
___________________________________________  the Board, Asia Global
              Jack M. Scanlon                Crossing

                    /*/                     Chief Executive Officer     March 31, 2000
___________________________________________  and Director; Chairman
              Leo J. Hindery                 and Chief Executive
                                             Officer, GlobalCenter,
                                             Inc.

                    /*/                     President, Chief Operating  March 31, 2000
___________________________________________  Officer and Director
               David L. Lee
</TABLE>

                                      II-8
<PAGE>

<TABLE>
<CAPTION>
                 Signature                           Capacity                Date
                 ---------                           --------                ----
<S>                                         <C>                        <C>


                    /*/                     Director, President,        March 31, 2000
___________________________________________  Global Crossing North
             Joseph P. Clayton               America

                    /*/                     Senior Vice President and   March 31, 2000
___________________________________________  Director
               Barry Porter
                    /*/                     Senior Vice President and   March 31, 2000
___________________________________________  Chief Financial Officer
               Dan J. Cohrs                  (principal financial
                                             officer and principal
                                             accounting officer)

___________________________________________ Director
               Abbott Brown

                    /*/                     Director                    March 31, 2000
___________________________________________
               Jay R. Bloom

                    /*/                     Director                    March 31, 2000
___________________________________________
          William E. Conway, Jr.

                    /*/                     Director                    March 31, 2000
___________________________________________
              Dean C. Kehler

                    /*/                     Director                    March 31, 2000
___________________________________________
            Geoffrey J.W. Kent

                    /*/                     Director                    March 31, 2000
___________________________________________
                Bruce Raben

                    /*/                     Director                    March 31, 2000
___________________________________________
             Michael R. Steed

                    /*/                     Director                    March 31, 2000
___________________________________________
             Robert Annunziata

                    /*/                     Director                    March 31, 2000
___________________________________________
             James F. McDonald

                    /*/                     Director                    March 31, 2000
___________________________________________
               Eric Hippeau

                    /*/                     Director                    March 31, 2000
___________________________________________
          Douglas H. McCorkindale
                                            Director
___________________________________________
                Canning Fok


* By Power-of-Attorney

             /s/ Dan J. Cohrs               Attorney-in-Fact            March 31, 2000
___________________________________________
               Dan J. Cohrs
</TABLE>

                                      II-9
<PAGE>

                                 EXHIBIT INDEX


<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 1.1     Form of Underwriting Agreement for [Common Stock] [Preferred Stock]
         (filed herewith).
 1.2     Form of Underwriting Agreement for [Convertible] [Senior]
         [Subordinated] Debt Securities (previously filed with this
         Registration Statement).
 2.1     Agreement and Plan of Merger, dated as of March 16, 1999 (the
         "Frontier Merger Agreement"), among the Registrant, Frontier
         Corporation and GCF Acquisition Corp. (incorporated by reference to
         Exhibit 2 to the Registrant's Current Report on Form 8-K filed on
         March 19, 1999 (the "March 19, 1999 8-K")).
 2.2     Consent and Amendment No. 1 to the Frontier Merger Agreement, dated as
         of May 16, 1999, among the Registrant, GCF Acquisition Corp. and
         Frontier Corporation (incorporated by reference to Exhibit 2 to the
         Registrant's Current Report on Form 8-K filed on May 18, 1999 (the
         "May 18, 1999 8-K")).
 2.3     Amendment No. 2 to the Frontier Merger Agreement, dated as of
         September 2, 1999, among the Registrant, GCF Acquisition Corp. and
         Frontier Corporation (incorporated by reference to Exhibit 2 to the
         Registrant's Current Report on Form 8-K filed on September 3, 1999
         (the "September 3, 1999 8-K")).
 2.4     Sale and Purchase Agreement, dated as of April 26, 1999, between Cable
         & Wireless plc and the Registrant (incorporated by reference to
         Exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on
         July 16, 1999 (the "July 16, 1999 8-K")).
 2.5     Amendment to the Sale and Purchase Agreement, dated as of June 25,
         1999, between Cable & Wireless plc and the Registrant (incorporated by
         reference to Exhibit 2.2 to the July 16, 1999 8-K).
 2.6     Agreement and Plan of Merger, dated as of May 16, 1999, between the
         Registrant and U S West, Inc. (incorporated by reference to Exhibit 2
         to the Registrant's Current Report on Form 8-K filed on May 21, 1999
         (the "May 21, 1999 8-K")).
 2.7     Letter Agreement, dated as of May 16, 1999, between the Registrant and
         U S West, Inc. (incorporated by reference to Exhibit 99 to the May 21,
         1999 8-K).
 2.8     Termination Agreement, dated as of July 18, 1999, between the
         Registrant and U S West, Inc. (incorporated by reference to Exhibit
         10.1 to the Registrant's Current Report on Form 8-K filed on July 20,
         1999 (the "July 20, 1999 8-K")).
 2.9     Agreement and Plan of Merger, dated as of February 22, 2000, among the
         Registrant, Georgia Merger Sub Corporation, IPC Communications, Inc.,
         IPC Information Systems, Inc., Idaho Merger Sub Corporation and IXnet,
         Inc. (incorporated by reference to Exhibit 2.10 to Registrant's annual
         report on Form 10-K for the year ended December 31, 1999).
 3.1     Memorandum of Association of the Registrant (incorporated by reference
         to Exhibit 3.1 to the Registrant's Registration Statement on Form S-
         1/A filed on July 2, 1998 (the "July 2, 1998 S-1/A")).
 3.2     Certificate of Incorporation of Change of Name of the Registrant dated
         April 30, 1998 (incorporated by reference to Exhibit 3.3 to the
         Registrant's Registration Statement on Form S-1/A filed on July 23,
         1998 (the "July 23, 1998 S-1/A")).
 3.3     Memorandum of Increase of Share Capital of the Registrant dated July
         9, 1998 (incorporated by reference to Exhibit 3.4 to the July 23, 1998
         S-1/A).
 3.4     Memorandum of Increase of Share Capital of the Registrant dated
         September 27, 1999 (incorporated by reference to Exhibit 3.1 to the
         Registrant's Quarterly Report on Form 10-Q filed on November 15, 1999
         (the "November 15, 1999 10-Q")).
 3.5     Bye-laws of the Registrant as in effect on October 14, 1999
         (incorporated by reference to Exhibit 3.2 to the November 15, 1999 10-
         Q).
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 3.6     Certificate of Designations of 6 3/8% Cumulative Convertible Preferred
         Stock of the Registrant dated November 5, 1999 (incorporated by
         reference to Exhibit 3.3 to the November 15, 1999 10-Q).
 3.7     Certificate of Designations of 7% Cumulative Convertible Preferred
         Stock of the Registrant, dated December 15, 1999 (incorporated by
         reference to Exhibit 3.9 to the Global Crossing Holdings Ltd.
         Registration Statement on Form S-4 filed on January 11, 2000 (File No.
         333-94449)).
 3.8     Certificate of Designations of 6 3/8% Cumulative Convertible Preferred
         Stock, Series B, of the Registrant, dated January 12, 2000
         (incorporated by reference to Registrant's annual report on Form 10-K
         for the year ended December 31, 1999).
 4.1     Certificate of Designations of 10 1/2% Senior Exchangeable Preferred
         Stock Due 2008 of Global Crossing Holdings Ltd. dated December 1, 1998
         (incorporated by reference to Schedule A to Exhibit 3.2 to the Global
         Crossing Holdings Ltd. Registration Statement on Form S-4 filed on
         December 22, 1998.)
 4.2     Indenture, dated as of May 18, 1998, between Global Crossing Holdings
         Ltd. and United States Trust Company of New York, as Trustee
         (incorporated by reference to Exhibit 4.2 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on December 22,
         1998).
 4.3     Supplemental Indenture, dated as of June 25, 1999, between Global
         Crossing Holdings Ltd. and United States Trust Company of New York, to
         the Indenture dated as of May 18, 1998 (incorporated by reference to
         Exhibit 4.4 to the Registrant's Registration Statement on Form S-4
         filed on July 12, 1999).
 4.4     Credit Agreement, dated as of July 2, 1999, among the Registrant,
         Global Crossing Holdings Ltd., the Lenders party thereto and The Chase
         Manhattan Bank as Administrative Agent (incorporated by reference to
         Exhibit 10.7 to the Registrant's Registration Statement on Form S-4/A
         filed on August 5, 1999).
 4.5     Indenture, dated as of November 19, 1999, among Global Crossing Ltd.,
         Global Crossing Holdings Ltd. and United States Trust Company of New
         York (incorporated by reference to Exhibit 4.5 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on January 11,
         2000 (File No. 333-94449)).
         Except as hereinabove provided, there is no instrument with respect to
         long-term debt of the Registrant and its consolidated subsidiaries
         under which the total authorized amount exceeds 10 percent of the
         total consolidated assets of the Registrant. The Registrant agrees to
         furnish to the SEC upon its request a copy of any instrument relating
         to long-term debt.
 4.6     Form of Indenture between the Registrant and United States Trust
         Company of New York, as Trustee (previously filed with this
         Registration Statement).
 4.7     Form of Certificate of Designations, Powers, Preferences and Rights
         for Preferred Stock (previously filed with this Registration
         Statement).
 4.8     Form of Common Stock Certificate. (The Form of Common Stock
         Certificate included as Exhibit 4.1 to the Registrant's registration
         statement on Form S-1 filed on July 23, 1998 is hereby incorporated
         herein by reference.)
 4.9     Form of Preferred Stock Certificate (previously filed with this
         Registration Statement).
 4.10    Form of Debt Warrant Agreement (previously filed with this
         Registration Statement).
 4.11    Form of Equity Warrant Agreement (previously filed with this
         Registration Statement).
 4.12    Form of Debt Security (previously filed with this Registration
         Statement).
 5.1     Opinion of Appleby, Spurling & Kempe (previously filed with this
         Registration Statement).
 10.1    Project Development and Construction Contract, dated as of March 18,
         1997, among AT&T Submarine Systems, Inc. and Atlantic Crossing Ltd.
         (formerly Global Telesystems Ltd.) (incorporated by reference to
         Exhibit 10.2 to the July 23, 1998 S-1/A).
 10.2    Project Development and Construction Contract, dated as of April 21,
         1998, among Tyco Submarine Systems, Ltd. and Pacific Crossing Ltd.
         (incorporated by reference to Exhibit 10.3 to the July 23, 1998 S-
         1/A).
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 10.3    Project Development and Construction Contract, dated as of June 2,
         1998, among Alcatel Submarine Networks and Mid-Atlantic Crossing Ltd.
         (incorporated by reference to Exhibit 10.4 to the July 23, 1998 S-
         1/A).
 10.4    Project Development and Construction Contract, dated as of July 21,
         1998, among Tyco Submarine Systems, Ltd. and Pan American Crossing
         Ltd. (incorporated by reference to Exhibit 10.5 to the Registrant's
         Quarterly Report on Form 10-Q filed on November 16, 1998).
 10.5    Project Development and Construction Contract, dated as of July 30,
         1999, among Alcatel Submarine Networks and South American Crossing
         Ltd. (incorporated by reference to Exhibit 10.5 to the Global Crossing
         Holdings Ltd. Registration Statement on Form S-4 filed on January 11,
         2000 (File No. 333-94449) portions have been omitted pursuant to a
         request for confidential treatment).
 10.6    Lease made as of October 1, 1999 between North Crescent Realty V, LLC
         and Global Crossing Development Company (incorporated by reference to
         Exhibit 10.1 to the November 15, 1999 10-Q).
 10.7    Form of Stockholders Agreement dated as of August 12, 1998 among the
         Registrant and the investors named therein (incorporated by reference
         to Exhibit 9.1 to the July 23, 1998 S-1/A).
 10.8    Form of Registration Rights Agreement dated as of August 12, 1998
         among the Registrant and the investors named therein (incorporated by
         reference to Exhibit 4.4 to the July 23, 1998 S-1/A).
 10.9    Voting Agreement, dated as of March 16, 1999, among certain
         shareholders of the Registrant parties thereto, Frontier Corporation
         and, for certain purposes only, the Registrant (incorporated by
         reference to Exhibit 10.2 to the March 19, 1999 8-K).

 10.10   Second Reaffirmation of Voting Agreement and Share Transfer
         Restriction Agreement, dated as of September 2, 1999 (incorporated by
         reference to Annex S-B to the joint proxy statement/prospectus
         supplement included in the Registrant's Registration Statement on Form
         S-4 filed on September 8, 1999 (the "September 8, 1999 S-4").
 10.11   Share Transfer Restriction Agreement, dated as of September 2, 1999,
         among certain shareholders of Global Crossing Ltd., certain
         shareholders of Frontier Corporation and Global Crossing Ltd.
         (incorporated by reference to Annex S-C to the joint proxy
         statement/prospectus supplement included in the September 8, 1999 S-
         4).
 10.12   Tender Offer and Purchase Agreement, dated as of May 16, 1999, between
         the Registrant and U S WEST, Inc. (incorporated by reference to
         Exhibit (c)(2) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21,
         1999).
 10.13   Standstill Agreement dated as of May 16, 1999 between U S WEST, Inc.
         and the Registrant (incorporated by reference to Exhibit (c)(4) to U S
         WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.14   Voting Agreement dated as of May 16, 1999 between U S WEST, Inc. and
         the Registrant (incorporated by reference to Exhibit (c)(3) to U S
         WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.15   Tender and Voting Agreement dated as of May 16, 1999 among U S WEST,
         Inc., the Registrant and the shareholders party thereto (incorporated
         by reference to Exhibit (c)(5) to U S WEST, Inc.'s Schedule 14D-1
         filed on May 21, 1999).
 10.16   Agreement dated as of May 16, 1999 among the Registrant and the
         shareholders party thereto (incorporated by reference to Exhibit
         (c)(6) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
 10.17   Transfer Agreement dated as of May 16, 1999 among the Registrant and
         the shareholders party thereto (incorporated by reference to Exhibit
         (c)(8) to U S WEST, Inc.'s Schedule 14D-1 filed on May 21, 1999).
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 10.18   Amendment No. 1 dated as of July 18, 1999 to Tender Offer and Purchase
         Agreement dated as of May 16 1999 between the Registrant and U S WEST,
         Inc. (incorporated by reference to Exhibit 10.2 to the July 20, 1999
         8-K).
 10.19   Agreement, dated as of July 18, 1999, between Qwest Communications
         International Inc. and the Registrant (incorporated by reference to
         Exhibit 10.3 to the July 20, 1999 8-K).
 10.20   Agreement, dated as of July 18, 1999, between Global Crossing Holdings
         Ltd. and Qwest Communications International Inc. (incorporated by
         reference to Exhibit 10.4 to the July 20, 1999 8-K).
 10.21   Registration Rights Agreement, dated as of November 5, 1999, among the
         Registrant and the initial purchasers of the Registrant's 6 3/8%
         Cumulative Convertible Preferred Stock named therein (incorporated by
         reference to Exhibit 10.21 to the Registrant's Registration Statement
         on Form S-3 (File No. 333-94805) filed on January 18, 2000).
 10.22   1998 Global Crossing Ltd. Stock Incentive Plan, as amended and
         restated effective December 7, 1999 (incorporated by reference to
         Exhibit 10.21 to the Global Crossing Holdings Ltd. Registration
         Statement on Form S-4 filed on January 11, 2000 (File No. 333-94449)).
 10.23   Form of Non-Qualified Stock Option Agreement as in effect on September
         30, 1999 (incorporated by reference to Exhibit 10.2 to the November
         15, 1999 10-Q).
 10.24   Frontier Corporation Supplemental Retirement Savings Plan as amended
         and restated effective January 1, 1996 (incorporated by reference to
         Exhibit 10.13 to Frontier Corporation's Annual Report on Form 10-K
         filed March 28, 1997).
 10.25   Amendment No. 1, effective March 16, 1999, to Frontier Corporation
         Supplemental Retirement Savings Plan (incorporated by reference to
         Exhibit 10.2 to Frontier Corporation's Quarterly Report on Form 10-Q
         filed August 3, 1999).
 10.26   Amendment No. 2, dated September 21, 1999, to Frontier Corporation
         Supplemental Retirement Savings Plan (incorporated by reference to
         Exhibit 10.5 to the November 15, 1999 10-Q).
 10.27   Employment Agreement dated as of February 19, 1999 between the
         Registrant and Robert Annunziata (incorporated by reference to Exhibit
         10.8 to the Registrant's Quarterly Report on Form 10-Q filed on May
         10, 1999).
 10.28   Executive Contract dated January 1, 1998 between Joseph P. Clayton and
         Frontier Corporation (incorporated by reference to Exhibit 10.22 to
         Frontier Corporation's Annual Report on Form 10-K filed March 26,
         1998).
 10.29   Amendment dated May 1, 1999 to Executive Contract between Joseph P.
         Clayton and Frontier Corporation (incorporated by reference to Exhibit
         10.9 to the November 15, 1999 10-Q).
 10.30   Sale Agreement, dated October 10, 1999, among Controls and
         Communications Limited, The Racal Corporation, Racal Electronics plc
         and the Registrant (incorporated by reference to Exhibit 2.1 of the
         Registrant's Current Report on Form 8-K filed on October 21, 1999).
 10.31   Subscription and Sale and Purchase Agreement, dated November 15, 1999,
         among Hutchison Whampoa Limited, Hutchison Telecommunications Limited,
         the Registrant and HCL Holdings Limited (incorporated by reference to
         Exhibit 10.33 to the Global Crossing Holdings Ltd. Registration
         Statement on Form S-4 filed on January 11, 2000 (File No. 333-94449)).
 10.32   Registration Rights Agreement, dated as of December 15, 1999, among
         the Registrant and the initial purchasers of the Registrant's 7%
         Cumulative Convertible Preferred Stock named therein (incorporated by
         reference to Exhibit 10.21 to the Registrant's Registration Statement
         on Form S-3 (File No. 333-94803) filed on January 18, 2000).
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                            Exhibit Description
 -------                           -------------------
 <C>     <S>
 10.33   Employment Agreement, dated as of December 5, 1999, between the
         Registrant and Leo J. Hindery, Jr. (incorporated by reference to
         Exhibit 10.32 to the Registrant's annual report on Form 10-K for the
         year ended December 31, 1999).
 10.34   Form of Change in Control Agreement between the Registrant and
         Executive Officers of the Registrant approved by the Board of
         Directors in January 2000 (incorporated by reference to Exhibit 10.33
         to the Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
 10.35   Employment Agreement, dated as of December 3, 1999, between the
         Registrant and John A. Scarpati (incorporated by reference to Exhibit
         10.36 to Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
 12.1    Statement of Computation of Earnings to Fixed Charges (incorporated by
         reference to Exhibit 12.1 to Registrant's annual report on Form 10-K
         for the year ended December 31, 1999).
 21.1    Subsidiaries of the Registrant (incorporated by reference to Exhibit
         21.1 to Registrant's annual report on Form 10-K for the year ended
         December 31, 1999).
 23.1    Consent of Arthur Andersen (filed herewith).
 23.2    Consent of PricewaterhouseCoopers LLP (filed herewith).
 23.3    Consent of KPMG Audit Plc (filed herewith).
 23.4    Consent of Deloitte & Touche (filed herewith).
 23.5    Consent of PricewaterhouseCoopers (filed herewith).
 23.6    Consent of Appleby, Spurling & Kempe (included in Exhibit 5.1).
 24.1    Power of Attorney of the Registrant (previously filed with this
         Registration Statement).
</TABLE>

<PAGE>

                                                                     Exhibit 1.1

                             Global Crossing Ltd.
                         [                    ] Shares
                        [COMMON STOCK][PREFERRED STOCK]
                            UNDERWRITING AGREEMENT

New York, New York
__________________

[Addressees]

Ladies and Gentlemen:

          Global Crossing Ltd., a Bermuda company (the "Company"), proposes to
issue and sell [                      ] shares of its [Common Stock][Preferred
Stock], and the persons named on Schedule I hereto (the "Selling Shareholders")
                                 ----------
propose to sell an aggregate of [               ] shares of [Common
Stock][Preferred Stock] of the Company (together with the [          ] shares of
[Common Stock][Preferred Stock] to be issued and sold by the Company, the "Firm
Shares") to you (the "Underwriters), in the amounts set forth in Schedule II
                                                                 -----------
hereto.  In addition, solely for the purpose of covering over-allotments, if
any, in connection with the sale of the Firm Shares, at the option of the
Underwriters, the Company will sell up to an additional [             ] shares
(the "Additional Shares") of its [Common Stock][Preferred Stock].  The Firm
Shares and the Additional Shares are collectively referred to herein as the
"Securities".  [The Preferred Stock will be issued pursuant to a certificate of
designations (the "Certificate of Designations"), which will be in form and
substance reasonably satisfactory to the Underwriters, and the terms thereof
will be contained in the Company's Bye-Laws (the "Bye-laws").  Under certain
circumstances set forth in the Certificate of Designations and Bye-Laws, the
Preferred Stock may be convertible into Common Stock, par value $0.01 per share
(the "Common Stock"), of the Company.]  The Transfer Agent for the Securities
will be EquiServe.  The Securities are more fully described in the Prospectuses
referred to below.  Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Prospectuses (as defined below).

          In connection with the sale of the Securities, the Company has
prepared and filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Act"), a Registration Statement on Form S-3, including
Prospectuses subject to completion, relating to the Securities.  The term
"Registration Statement"
<PAGE>

as used in this Agreement means the registration statement (including all
financial schedules and exhibits and all documents incorporated therein by
reference), as amended at the time it becomes effective, and as thereafter
amended by post-effective amendment. The term "Prospectuses" as used in this
Agreement means the prospectuses in the forms included in the Registration
Statement or, if the prospectuses included in the Registration Statement omit
the information in reliance on Rule 430A under the Act and such information is
included in prospectuses filed with the Commission pursuant to Rule 424(b) under
the Act, the term "Prospectuses" as used in this Agreement means the
prospectuses in the forms included in the Registration Statement as supplemented
by the addition of the Rule 430A information contained in the prospectuses filed
with the Commission pursuant to Rule 424(b). The term "Prepricing Prospectuses"
as used in this Agreement means the prospectuses subject to completion in the
forms included in the Registration Statement at the time of the initial filing
of the Registration Statement with the Commission, as such prospectuses shall
have been amended from time to time prior to the date of the Prospectuses.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.

          Certificates in transferable form for the Securities that each Selling
Shareholder agrees to sell pursuant to this Agreement have been placed in
custody with [                        ] (the "Custodian") for delivery under
this Agreement pursuant to a Custody Agreement and Power of Attorney (the
"Custody Agreement") executed by each of the Selling Shareholders appointing [
] and [                       ] as agents and attorneys-in-fact (the "Attorneys-
in-Fact").  Each Selling Shareholder agrees that (i) the Securities represented
by the certificates held in custody pursuant to the Custody Agreement are
subject to the interests of the Underwriters, the Company and each other Selling
Shareholder, (ii) the arrangements made by the Selling Shareholders for such
custody are, except as specifically provided in the Custody Agreement,
irrevocable and (iii) the obligations of any Selling Shareholder hereunder and
under the Custody Agreement shall not be terminated by any act of such Selling
Shareholder or by operation of law, whether by the death or incapacity of such
Selling Shareholder or the occurrence of any other event or, if such Selling
Shareholder is not a natural person, upon any dissolution, winding up,
distribution of assets or other event affecting the legal existence of such
Selling Shareholder.  If any Selling Shareholder shall die or be incapacitated
or if any other event shall occur before the delivery of the Securities
hereunder, or if such Selling Shareholder is not a natural person, if such
Selling Shareholder shall dissolve, wind  up, distribute assets or if any other
event affecting the legal existence of such Selling Shareholder shall occur
before the delivery of the Securities hereunder, certificates for the Securities
of such Selling Shareholder shall be delivered to the Underwriters by the
Attorneys-in-Fact in accordance with the terms and conditions of this Agreement
and the Custody Agreement as if such death or incapacity, dissolution, winding
up or distribution of assets or other event had not occurred, regardless of
whether or not the Attorneys-in-Fact or any Underwriter shall have received
notice of such death, incapacity, dissolution, winding up or distribution of
assets or other event.  Each Attorney-in-Fact is authorized, on behalf of each
of the Selling Shareholders, to execute this Agreement and any other documents
necessary or desirable in connection with the sale of the Securities to be sold
hereunder by such Selling Shareholder, to make delivery of the certificates for
such Securities, to receive the proceeds of the sale of such Shares, to give
receipts for such proceeds, to pay therefrom any expenses to be borne by such
Selling Shareholder in connection with the sale

                                       2
<PAGE>

and public offering of such Securities, to distribute the balance thereof to
such Selling Shareholder and to take such other action as may be necessary or
desirable in connection with the transactions contemplated by this Agreement.
Each Attorney-in-Fact agrees to perform his duties under the Custody Agreement.

          This Agreement, the Securities, the Certificate of Designations and
the Bye-Laws are hereinafter referred to collectively as the "Operative
Documents".

          1.  Representations and Warranties.  (A)  The Company hereby
              ------------------------------
represents and warrants to each Underwriter as set forth below in this Section
1(A).

          (a) The Registration Statement and the Prospectuses and any supplement
     or amendment thereto when filed with the Commission under Rule 424(b) under
     the Act complied or will comply in all material respects with the
     provisions of the Act and will not at any such times contain any untrue
     statement of a material fact or omit to state any material fact necessary
     to make the statements therein, in the light of the circumstances under
     which they were made, not misleading; provided, however, that the Company
     does not make any representation or warranty as to the information
     contained in or omitted from the Registration Statement or any Prospectus,
     or any amendment or supplement thereto, in reliance upon and in conformity
     with information furnished in writing to the Company by any Underwriter
     specifically for inclusion therein.

          (b) The statements made in the Prospectuses under the caption
     "Description of the [Common Stock][Preferred Stock]",  insofar as they
     purport to constitute summaries of certain terms of documents referred to
     therein, constitute or will constitute accurate summaries of the terms of
     such documents in all material respects.

          (c) The execution and delivery of, and the performance by the Company
     of its obligations under, this Agreement have been duly and validly
     authorized by the Company; this Agreement has been duly executed and
     delivered by the Company and, assuming due authorization, execution and
     delivery by the other parties hereto, constitutes the valid and binding
     agreement of the Company, enforceable against the Company in accordance
     with its terms, subject to the qualification that the enforceability of the
     Company's obligations hereunder may be limited by bankruptcy, fraudulent
     conveyance, insolvency, reorganization, moratorium or other similar laws
     relating to or affecting creditors' rights generally and by general
     principles of equity, and except as rights to indemnity and contribution
     hereunder may be limited by Federal or state securities laws or principles
     of public policy.

          (d) [The amendment of the Bye-laws to incorporate the terms of the
     Preferred Stock has been duly authorized by all necessary corporate and
     shareholder action and, on the Closing Date, the Certificate of Designation
     will have been duly executed by the Company, and the Bye-laws will have
     been amended to incorporate the terms of the Preferred Stock, which terms
     will conform in all material respects to the description thereof in the

                                       3
<PAGE>

     Prospectuses;] the Company has duly authorized the Securities and, when
     issued and authenticated in accordance with the Bye-laws and delivered to
     and paid for by the Underwriters in accordance with the terms hereof, the
     Securities will represent a legally valid and binding obligation of the
     Company, enforceable against the Company in accordance with its terms,
     subject to the qualification that the enforceability of the Company's
     obligations with respect thereto may be limited by bankruptcy, fraudulent
     conveyance, insolvency, reorganization, moratorium or other similar laws
     relating to or affecting creditors' rights generally and by general
     principles of equity.

          (e) All the outstanding shares of Common Stock of the Company have
     been duly authorized and validly issued, are fully paid and nonassessable
     and are free of any preemptive or similar rights; [the shares of Common
     Stock into which the shares of Preferred Stock may be converted will be
     duly authorized and, when issued and delivered to the holders of Securities
     against payment therefor in accordance with the terms of the Preferred
     Stock, validly issued, fully paid and nonassessable and free of any
     preemptive rights]; and the capital stock of the Company conforms to the
     description thereof in the Prospectuses.

          (f) The Company is a company duly organized and validly existing and
     in good standing under the laws of Bermuda and has the requisite corporate
     power and authority to own, lease and operate its properties and to conduct
     its business as described in the Registration Statement or the Prospectuses
     and to execute, deliver and perform its obligations under the Operative
     Documents (including, without limitation, the requisite corporate power and
     authority to issue, sell and deliver the Securities), and is duly
     registered and qualified to conduct its business and is in good standing in
     each jurisdiction or place where the nature of its properties or the
     conduct of its business requires such registration or qualification, except
     where the failure so to register or qualify or to be in good standing would
     not have a material adverse effect on the business, assets, condition
     (financial or otherwise) or results of operations of the Company and the
     direct or indirect subsidiaries of the Company (the "Subsidiaries"), taken
     as a whole (a "Material Adverse Effect").

          (g) Each of the Subsidiaries is duly organized and validly existing
     and in good standing under the laws of the jurisdiction of its organization
     and has the requisite power (corporate and other) and authority to own,
     lease and operate its properties and to conduct its business as described
     in the Registration Statement or the Prospectuses and is duly registered
     and qualified to conduct its business and is in good standing in each
     jurisdiction or place where the nature of its properties or the conduct of
     its business requires such registration or qualification, except where the
     failure so to register or qualify or be in good standing would not have a
     Material Adverse Effect.  All of the outstanding shares of capital stock of
     each of the Subsidiaries have been duly authorized and validly issued, are
     fully paid and nonassessable, and, with respect to capital stock of the
     Subsidiaries, are wholly owned by the Company, directly or indirectly
     through one of the other Subsidiaries, free and clear of any lien, adverse
     claim, security interest, equity or other encumbrance, except [     ].

                                       4
<PAGE>

          (h) Except as disclosed in the Registration Statement or the
     Prospectuses, there are no legal or governmental proceedings pending or, to
     the knowledge of the Company, threatened, against the Company or any of the
     Subsidiaries or to which any of their respective properties is subject
     that, if determined adversely to the Company or any of the Subsidiaries,
     would have a Material Adverse Effect or that are required to be described
     or summarized in the Registration Statement or the Prospectuses but are not
     described as required by the Act.  The Registration Statement and
     Prospectuses contain accurate summaries of all material agreements,
     contracts, indentures, leases or other instruments that are required to be
     described or summarized under the Act.

          (i) Neither the Company nor any of the Subsidiaries is (i) in
     violation of its organizational documents, or of any law, ordinance,
     administrative or governmental rule or regulation applicable to it or of
     any decree of any court or governmental agency or body having jurisdiction
     over it, except where any such violation or violations would not have a
     Material Adverse Effect or (ii) except as may be disclosed in the
     Registration Statement or the Prospectuses, in default in the performance
     of any obligation, agreement or condition contained in any bond, debenture,
     note or any other evidence of indebtedness or in any material agreement,
     indenture, lease or other instrument to which it is a party or by which it
     or any of its properties may be bound, which either individually or in the
     aggregate would have a Material Adverse Effect.

          (j) None of the issuance, offer or sale of the Securities, the
     execution, delivery or performance by the Company of this Agreement or the
     other Operative Documents (including, without limitation, the amendment of
     the Bye-Laws to incorporate the terms of the Preferred Stock), compliance
     by the Company with the provisions hereof nor consummation by the Company
     of the transactions contemplated hereby or thereby (i) requires any
     consent, approval, authorization or other order of, or registration or
     filing with, any court or governmental agency or body having jurisdiction
     over it (except such as may be required in connection with any consent,
     approval, authorization or other order of the Bermuda Minister of Finance
     or the Bermuda Monetary Authority and compliance with the securities or
     Blue Sky laws of various jurisdictions), (ii) conflicts or will conflict
     with or constitutes or will constitute a breach of, or a default under, the
     organizational documents of the Company or any of the Subsidiaries or any
     material agreement, indenture, lease or other instrument to which the
     Company or any of the Subsidiaries is a party or by which any of them or
     any of their respective properties may be bound, (iii) violates or will
     violate any statute, law, regulation or filing or judgment, injunction,
     order or decree applicable to the Company or any of the Subsidiaries or any
     of their respective properties, or (iv) will result in the creation or
     imposition of any lien, charge or encumbrance upon any property or assets
     of the Company or any of the Subsidiaries pursuant to the terms of any
     agreement or instrument to which any of them is a party or by which any of
     them may be bound or to which any of the property or assets of any of them
     is subject.

                                       5
<PAGE>

          (k) [                ], who have certified the financial statements of
     the Company included as part of or incorporated by reference in the
     Registration Statement and the Prospectuses are independent public
     accountants within the meaning of the Securities Act and the applicable
     rules and regulations thereunder.

          (l) The financial statements, together with the related notes thereto,
     included as part of the Registration Statement and the Prospectuses or
     incorporated by reference therein, present fairly in all material respects
     the consolidated financial position, results of operations, shareholders'
     equity and cash flows of the Company together with its consolidated
     subsidiaries [and [               ] and their consolidated subsidiaries] on
     the basis stated in the Registration Statement and the Prospectuses at the
     respective dates or for the respective periods to which they apply (to the
     extent such entities were in existence at such dates or for such periods);
     such statements and related notes have been prepared in accordance with
     generally accepted accounting principles consistently applied throughout
     the periods involved, except as disclosed therein, and meet the
     requirements of Regulation S-X under the Securities Act for registration
     statements on Form S-3; and the other financial information and data set
     forth or incorporated by reference in the Registration Statement and the
     Prospectuses is accurately presented and, to the extent such information
     and data is derived from the financial books and records of the Company, is
     prepared on a basis consistent with such financial statements and the books
     and records of the Company.  The selected financial data set forth under
     the caption "Selected historical financial information" in the Registration
     Statement and the Prospectuses or the selected financial data incorporated
     by reference in the Registration Statement and the Prospectuses fairly
     present the information included or incorporated by reference therein.

          (m) The pro forma financial statements included in the Registration
     Statement and the Prospectuses have been prepared on a basis consistent
     with the historical financial statements of the Company and its
     consolidated subsidiaries, except for the pro forma adjustments specified
     therein, and give effect to assumptions made on a reasonable basis and
     present fairly in all material respects the historical transactions
     contemplated in the Registration Statement and the Prospectuses and comply
     as to form in all material respects with the requirements of Regulation S-X
     under the Act.

          (n) Except as disclosed in, or specifically contemplated by, the
     Registration Statement or the Prospectuses, subsequent to the date as of
     which such information is given in the Registration Statement or the
     Prospectuses (as amended or supplemented, if applicable), neither the
     Company nor any of the Subsidiaries has incurred any liability or
     obligation, direct or contingent, or entered into any transaction, in each
     case not in the ordinary course of business, that is material to the
     Company and the Subsidiaries taken as a whole, and there has not been any
     material change in the capital stock, or material increase in the short-
     term or long-term debt, of the Company or any of the Subsidiaries or any
     material adverse change, or any development involving or which would be
     expected to

                                       6
<PAGE>

     involve a prospective material adverse change, in the business, assets,
     condition (financial or otherwise) or results of operations of the Company
     and the Subsidiaries taken as a whole.

          (o) Each of the Company and the Subsidiaries has good and indefeasible
     title to all property (real and personal) described in the Registration
     Statement and the Prospectuses as being owned by it, free and clear of all
     liens, claims, security interests or other encumbrances, except such as are
     described in the Registration Statement or the Prospectuses or would not
     have a Material Adverse Effect, and all the material property described in
     the Registration Statement or the Prospectuses as being held under lease by
     each of the Company and the Subsidiaries is held by them under valid,
     subsisting and enforceable leases, with only such exceptions as would not
     have a Material Adverse Effect.

          (p) Each of the Company and the Subsidiaries has such permits,
     licenses, franchises, certificates of need and other approvals or
     authorizations of governmental or regulatory authorities ("Permits") as are
     necessary under applicable law to own their respective properties and to
     conduct their respective businesses in the manner described in the
     Registration Statement  or Prospectuses, except to the extent that the
     failure to have such Permits would not have a Material Adverse Effect; the
     Company and each of the Subsidiaries have fulfilled and performed in all
     material respects all their respective material obligations with respect to
     the Permits, and no event has occurred which allows, or after notice or
     lapse of time would allow, revocation or termination thereof or results in
     any other material impairment of the rights of the holder of any such
     Permit, subject in each case to such qualification as may be set forth in
     the Registration Statement or the Prospectuses and except to the extent
     that any such revocation or termination would not have a Material Adverse
     Effect.

          (q) The Company and the Subsidiaries, taken as a whole, are insured by
     insurers of recognized financial responsibility against such losses and
     risks and in such amounts as are prudent.

          (r) Neither the Company nor the Subsidiaries have violated any
     applicable foreign, federal, state or local law or regulation relating to
     the protection of human health and safety, the environment or hazardous or
     toxic substances or wastes, pollutants or contaminants ("Environmental
     Laws"), except for such violations which, singly or in the aggregate, would
     not have a Material Adverse Effect.

          (s) There are no costs or liabilities associated with any applicable
     Environmental Laws (including, without limitation, any capital or operating
     expenditures required for clean-up, closure of properties or compliance
     with Environmental Laws or any permit, license or approval, any related
     constraints on operating activities and any potential liabilities to third
     parties) which would, singly or in the aggregate, have a Material Adverse
     Effect.

                                       7
<PAGE>

          (t) No holder of any security of the Company or any of the
     Subsidiaries has any right to request or demand registration of shares of
     common stock or any other security of the Company because of the
     consummation of the transactions contemplated by this Agreement.  Except as
     described in the Registration Statement or the Prospectuses, there are no
     outstanding options, warrants or other rights calling for the issuance of,
     and there are no commitments, agreements or arrangements to issue, any
     shares of capital stock of the Company or any of the Subsidiaries or any
     security convertible into or exchangeable or exercisable for capital stock
     of the Company or any of the Subsidiaries.

          (u) The Company and each of the Subsidiaries own or possess all
     patents, trademarks, trademark registration, service marks, service mark
     registrations, trade names, copyrights, licenses, inventions, trade secrets
     and rights described in the Registration Statement or the Prospectuses as
     being owned by any of them or necessary for the conduct of their respective
     businesses, and, except as may be disclosed in the Registration Statement
     or the Prospectuses, the Company is not aware of any claim to the contrary
     or any challenge by any other person to the rights of the Company and the
     Subsidiaries with respect to the foregoing which, if determined adversely
     to the Company or the Subsidiaries, would have a Material Adverse Effect.

          (v) The Company is not an "investment company" within the meaning of
     the Investment Company Act of 1940, as amended (the "Investment Company
     Act").

          (w) Prior to the date hereof, the Company, has not taken any action
     which is designed to or which has constituted or which might have been
     expected to cause or result in stabilization or manipulation of the price
     of any security of the Company in connection with the offering of the
     Securities.

          (B) Each Selling Shareholder represents and warrants to each
Underwriter as set forth in this Section 1(B).

          (a) Such Selling Shareholder now has, and on the Closing Date, will
     have, valid and marketable title to the Securities to be sold by such
     Selling Shareholder hereunder, free and clear of any lien, claim, security
     interest or other encumbrance, including, without limitation, any
     restriction on transfer, except as otherwise described in the Registration
     Statement or the Prospectuses.

          (b) Such Selling Shareholder now has, and on the Closing Date will
     have, full legal right, power and authorization required by law to sell,
     assign, transfer and deliver such Securities in the manner provided in this
     Agreement, free and clear of any lien, claim, security interest or other
     encumbrance.

          (c) Each of this Agreement and the Custody Agreement has been duly
     executed and delivered by or on behalf of such Selling Shareholder and,
     assuming due authorization,

                                       8
<PAGE>

     execution and delivery by the other parties hereto and thereto, constitutes
     the valid and legally binding agreement of such Selling Shareholder,
     enforceable against such Selling Shareholder in accordance with its terms,
     except that the enforceability of such Selling Shareholder's obligations
     hereunder or thereunder may be limited by bankruptcy, insolvency or other
     similar laws affecting the enforcement of creditors' rights generally and
     subject to the applicability of general principles of equity.

          (d) Neither the sale of the Securities to be sold by such Selling
     Shareholder hereunder, the execution, delivery or performance of this
     Agreement or the Custody Agreement by or on behalf of such Selling
     Shareholder nor the consummation by such Selling Shareholder of the
     transactions contemplated hereby and thereby (i) requires any consent,
     approval, authorization or other order of or registration or filing with,
     any court or governmental agency or body having jurisdiction over it
     (except such as may be required for the registration of the Securities
     under the Act and compliance with the securities or Blue Sky laws of
     various jurisdictions, all of which have been or will be effected in
     accordance with this Agreement), (ii) conflicts or will conflict with or
     constitutes or will constitute a breach of, or a default under any material
     agreement, indenture, lease or other instrument to which such Selling
     Shareholder is party or by which such Selling Shareholder may be bound,
     (iii) violates or will violate any statute, law, regulation or filing or
     judgment, injunction, order or decree applicable to such Selling
     Shareholder or (iv) will result in the creation or imposition of any lien,
     charge or encumbrance upon any property or assets of such Selling
     Shareholder pursuant to the terms of any agreement or instrument to which
     such Selling Shareholder is party or by which such Selling Shareholder may
     be bound or to which any of the property or assets of such Selling
     Shareholder is subject.

          (e) The information pertaining to such Selling Shareholder provided to
     the Company for inclusion under the caption "Selling Shareholders" in the
     Prospectuses does not and will not on the Closing Date contain any untrue
     statement of a material fact or omit to state any material fact required to
     be stated therein or necessary to make the statements therein not
     misleading.

          (f) The representations and warranties of such Selling Shareholder in
     the Custody Agreement are, and on the Closing Date will be, true and
     correct.

          (g) Such Selling Shareholder has not taken, directly or indirectly,
     any action designed to or that might reasonably be expected to cause or
     result in stabilization or manipulation of the price of the [Common Stock]
     to facilitate the sale or resale of the Securities.

          2.  Purchase and Sale.  (a)  Subject to the terms and conditions and
              -----------------
in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
[            ]% of the principal amount thereof, [plus accrued dividends from [

                                       9
<PAGE>

                ], if settlement occurs after that date,] [ ] Firm Shares in the
amount set forth opposite such Underwriter's name on Schedule I hereto.
                                                     ----------

          (b) The Company also agrees, subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, that the
Underwriters shall have the right to purchase from the Company, solely for the
purpose of covering over-allotments in connection with sales of the Firm Shares,
pursuant to an option (the "over-allotment option") which may be exercised at
any time and from time to time prior to 10:00 p.m., New York City time, on the
30th day after the date of the Prospectus (or, if such 30th day shall be a
Saturday or Sunday or a holiday, on the next business day thereafter when the
New York Stock Exchange is open for trading), up to an aggregate of [
] Additional Shares.  Upon any exercise of the over-allotment option, each
Underwriter, severally and not jointly, agrees to purchase from the Company the
number of Additional Shares that bears the same proportion to the aggregate
number of Additional Shares to be purchased by the Underwriters as the number of
Firm Shares set forth opposite the name of such Underwriter on Schedule I hereto
bears to the aggregate number of Firm Shares.

          3.  Delivery and Payment.  Delivery of and payment for the Firm Shares
              --------------------
shall be made at 10:00 AM, New York City time, on [
], or such later date (not later than [                        ]) as the
Underwriters shall designate, which date and time may be postponed by agreement
between the Underwriters and the Company or as provided in Section 8 hereof
(such date and time of delivery and payment for the Firm Shares being herein
called the "Closing Date").  Delivery of the Firm Shares shall be made to the
Underwriters for the respective accounts of the Underwriters against payment
thereby of the purchase price thereof to or upon the order of the Company by
wire transfer of immediately available funds or such other manner of payment as
may be agreed by the Company and the Underwriters.  Delivery of the Firm Shares
shall be made at such location as the Underwriters shall reasonably designate at
least one business day in advance of the Closing Date and payment for the Firm
Shares shall be made at the office of Latham & Watkins ("Counsel for the
Underwriters"), 885 Third Avenue, New York, New York.  Certificates for the Firm
Shares shall be registered in such names and in such denominations as the
Underwriters may request not less than three full business days in advance of
the Closing Date.

          The Company agrees to have the Firm Shares available for inspection by
the Underwriters in New York, New York, not later than 1:00 PM, New York City
time, on the business day immediately prior to the Closing Date.

          Delivery of, and payment of the purchase price for any Additional
Shares to be purchased by the Underwriters shall be made at the offices of
Latham & Watkins, 885 Third Avenue, New York, NY 10022, or such other location
as may be mutually acceptable, at such time and on such date (the "Option
Closing Date"), which may be the same as the Closing Date but shall in no event
be earlier than the Closing Date nor later than ten business days after the
giving of the notice hereinafter referred to, as shall be specified in a written
notice from [                                ], on behalf of the Underwriters to
purchase a number, specified in such notice, of Additional Shares.

                                      10
<PAGE>

          4.  Agreements.  (A)  The Company hereby agrees with each Underwriter
              ----------
that:

          (a) If, at the time this Agreement is executed and delivered, it is
     necessary for the Registration Statement or a post-effective amendment
     thereto to be declared effective before the offering of the Securities may
     commence, the Company will use its reasonable best efforts to cause the
     Registration Statement or such post-effective amendment to become effective
     as soon as possible and will advise you promptly and, if requested by you,
     will confirm such advice in writing, when the Registration Statement or
     such post-effective amendment has become effective.

          (b) The Company will advise you promptly and, if requested by you,
     will confirm such advice in writing:  (i) of any request by the Commission
     for amendment of or supplement to the Registration Statement, any
     Prepricing Prospectuses or the Prospectuses or for additional information;
     and (ii)  of the issuance by the Commission of any stop order suspending
     the effectiveness of the Registration Statement or of the suspension of
     qualification of the Securities for offering or sale in any jurisdiction or
     the initiation of any proceeding for such purpose.  If at any time the
     Commission shall issue any stop order suspending the effectiveness of the
     Registration Statement, the Company will make every reasonable effort to
     obtain the withdrawal of such order at the earliest possible time.

          (c) The Company will furnish to you, without charge, one signed copy
     of the Registration Statement as originally filed with the Commission and
     of each amendment thereto, including financial statements and all exhibits
     to the Registration Statement and will also furnish to you, without charge,
     such number of conformed copies of the Registration Statement as originally
     filed and of each amendment thereto, but without exhibits, as you may
     reasonably request.

          (d) The Company will not file any amendment to the Registration
     Statement (other than any Exchange Act Documents incorporated therein) or
     make any amendment or supplement to the Prospectuses (other than any
     Exchange Act Documents incorporated therein) of which you shall not
     previously have been advised or to which you shall reasonably object in
     writing after being so advised.  "Exchange Act Documents" means any
     documents filed by the Company or any Subsidiary thereof with the
     Commission under the Exchange Act and any rules and regulations promulgated
     thereunder, and any amendment or supplement thereto.

          (e) Prior to the execution and delivery of this Agreement, the Company
     has delivered or will deliver to you, without charge, in such quantities as
     you have reasonably requested or may hereafter reasonably request, copies
     of each form of the Prepricing Prospectus.  The Company consents to the
     use, in accordance with the provisions of the Act and with the securities
     or Blue Sky laws of the jurisdictions in which the Securities are offered
     by the Underwriters and by dealers, prior to the date of the Prospectus, of
     each Prepricing Prospectus so furnished by the Company.

                                      11
<PAGE>

          (f) As soon as practicable after the execution and delivery of this
     Agreement and thereafter from time to time for such period as in the
     written opinion of counsel for the Underwriters a Prospectus is required by
     the Act to be delivered in connection with sales by any Underwriter or
     dealer, the Company will expeditiously deliver to each Underwriter and each
     dealer, without charge, as many copies of the Prospectus (and any amendment
     or supplement thereto) as you may reasonably request.  The Company consents
     to the use of the Prospectus (and any amendment or supplement thereto) in
     accordance with the provisions of the Act and with the securities or Blue
     Sky laws of the jurisdiction in which the Securities are offered by the
     Underwriters and by all dealers to whom Securities may be sold, both in
     connection with the offering and sale of the Securities and for such period
     of time thereafter as the Prospectus is required by the Act to be delivered
     in connection with sales by any Underwriter or dealer.  If during such
     period of time any event shall occur that in the judgment of the Company or
     in the written opinion of counsel for the Underwriters is required to be
     set forth in the Prospectus (as then amended or supplemented) or should be
     set forth therein in order to make the statements therein, in the light of
     the circumstances under which they were made, not misleading, or it is
     necessary to supplement or amend the Prospectus to comply with the Act of
     any other law, the Company will forthwith prepare and, subject to the
     provisions of paragraph (d) above, file with the Commission an appropriate
     supplement or amendment thereto and will expeditiously furnish to the
     Underwriters and dealers a reasonable number of copies thereof.

          (g) The Company will cooperate with you and with counsel for the
     Underwriters in connection with the registration or qualification of the
     Securities for offering and sale by the Underwriters in connection with the
     registration or qualification of the Securities for offering and sale by
     the Underwriters and by dealers under the securities or Blue Sky laws of
     such jurisdictions as you may reasonably designate and will file such
     consents to service of process or other documents necessary or appropriate
     in order to effect such registration or qualification; provided that in no
     event shall the Company be obligated to qualify to do business in any
     jurisdiction where it is now so qualified or to take any action that would
     subject it to service of process in suits, other than those arising out of
     the offering or sale of the Securities, in any jurisdiction where it is not
     now so subject.

          (h)  The Company will make generally available to its security holders
     a consolidated earnings statement, which need not be audited, covering a
     twelve-month period commencing after the effective date of the Registration
     Statement and ending not later than 15 months thereafter, as soon as
     reasonably practicable after the end of such period, which consolidated
     earnings statement shall satisfy the provisions of Section 11(a) of the
     Act; provided that such requirement shall be deemed satisfied if the
     Company complies with the provisions of Rule 158 of the Act.

          (i) The Company will apply the net proceeds from the sale of the
     Securities to be sold by it hereunder in the manner set forth in the
     Prospectuses under the caption "Use of Proceeds."

                                      12
<PAGE>

          (j)  If Rule 430(a) of the Act is employed, the Company will timely
     file the Prospectuses pursuant to Rule 424(b) under the Act and will advise
     you of the time and manner of such filing.

          (k) Except as stated in this Agreement and in the Prepricing
     Prospectuses and Prospectuses, the Company has not taken, nor will it take,
     directly or indirectly, any action designed to or that might reasonable be
     expected to cause or result in stabilization or manipulation of the price
     of the Common Stock to facilitate the sale or resale of the Securities.

          (l) The Company will use its reasonable best efforts to have the
     [Common Stock] listed, subject to notice of issuance, on the Nasdaq
     National Market concurrently with the effectiveness of the Registration
     Statement.

          (B) Each Selling Shareholder agrees with the Underwriters as follows:

          (a)  Such Selling Shareholder will cooperate to the extent necessary
     to cause the Registration Statement or any post-effective amendment thereto
     to become effective at the  earliest possible time.

          (b) Such Selling Shareholder will pay all Federal and other taxes, if
     any on the transfer or sale of such Securities that are sold by such
     Selling Shareholder to the Underwriters.

          (c) Such Selling Shareholder will do or perform all things required to
     be done or performed by such Selling Shareholder prior to the Closing Date
     to satisfy all conditions precedent to the delivery of the Securities that
     are sold by such Selling Shareholder pursuant to this Agreement.

          (d) Except as stated in this Agreement and the Prepricing Prospectuses
     and the Prospectuses, such Selling Shareholder has not taken, nor will it
     take, directly or indirectly, any action designed to or that might
     reasonably be expected to cause or result in stabilization or manipulation
     of the price of the Common Stock to facilitate the sale or resale of the
     Securities.

          5.  Conditions to the Obligations of the Underwriters.  The several
              -------------------------------------------------
obligations of the Underwriters to purchase the Firm Shares and the Additional
Shares, as provided herein, shall be subject to the accuracy of the
representations and warranties on the part of the Company  and the Selling
Shareholders contained herein at the date and time that this Agreement is
executed and delivered by the parties hereto (the "Execution Time") and the
                                                   --------------
Closing Date, except that with respect to the Additional Shares, references to
the Closing Date shall mean the Option Closing Date, to the accuracy of the
statements of the Company made in any certificates pursuant to the provisions

                                      13
<PAGE>

hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions:

          (a) If, at the time this Agreement is executed and delivered, it is
     necessary for the Registration Statement or a post-effective amendment
     thereto to be declared effective before the offering of the Securities may
     commence, the Registration Statement or such post-effective amendment shall
     have become effective not later than 5:30 P.M. New York City time, on the
     date hereof, or at such later date and time as shall be consented to in
     writing by you, and all filings, if any, required by Rules 424 and 430A
     under the Act shall have been timely made; no stop order suspending the
     effectiveness of the Registration Statement shall have been issued and no
     proceeding for that purpose shall have been instituted or, to the knowledge
     of the Company or any Underwriter, threatened by the Commission, and any
     request of the Commission for additional information (to be included in the
     Registration Statement or the Prospectuses or otherwise) shall have been
     complied with to your satisfaction.

          (b) The Underwriters shall have received the opinion of Simpson
     Thacher & Bartlett, counsel for the Company, dated the Closing Date, to the
     effect that:

               (i) The Registration Statement has become effective under the Act
          and the Prospectuses were filed on the date specified in such opinion
          pursuant to the subsection set forth in such opinion of Rule 424(b) of
          the rules and regulations of the Commission under the Act and, to the
          knowledge of such counsel, no stop order suspending the effectiveness
          of the Registration Statement has been issued or proceeding for that
          purpose has been instituted or threatened by the Commission.

               (ii) Assuming that this Agreement has been duly authorized,
          executed and delivered by each party hereto (other than the Company),
          this Agreement constitutes a valid and legally binding obligation of
          such party, enforceable against such party in accordance with its
          terms;

               (iii)  The statements made in the Prospectuses under the captions
          "Description of the [Common Stock][Preferred Stock]" and "Plan of
          Distribution," insofar as they purport to constitute summaries of
          certain terms of documents referred to therein, constitute accurate
          summaries of the terms of such documents in all material respects;

               (iv) The issue and sale of the Securities by the Company and the
          compliance by the Company with all of the provisions of the Operative
          Documents will not breach or result in a default under any indenture,
          mortgage, deed of trust, loan agreement or other agreement or
          instrument identified on an annexed schedule furnished to such counsel
          by the Company, nor will such action violate any Federal or New York
          statute or any rule or
                                      14
<PAGE>

          regulation that has been issued pursuant to any Federal or New York
          statute or any order known to such counsel issued pursuant to any
          Federal or New York statute by any court or governmental agency or
          body or court having jurisdiction over the Company or any of its
          respective properties;

               (v) No consent, approval, authorization, order, registration or
          qualification of or with any Federal or New York governmental agency
          or body or, to our knowledge, any Federal or New York court is
          required for the issue and sale of the Securities by the Company and
          the compliance by the Company with all of the provisions of the
          Operative Documents, except for such consents, approvals,
          authorizations, registrations or qualifications as may be required
          under state securities or Blue Sky laws in connection with the
          purchase and distribution of the Securities by the Underwriters;

               (vi) The statements made in the Prospectuses under the caption
          "Certain Income Tax Consequences - Taxation of Holders of [Common
          Stock][Preferred Stock]-United States Federal Income Tax
          Considerations" insofar as they purport to constitute summaries of
          matters of United States federal tax law and regulations or legal
          conclusions with respect thereto, constitute accurate summaries of the
          matters described therein in all material respects;

               (vii)  The Company is not an "investment company" within the
          meaning of and subject to regulation under the Investment Company Act
          of 1940, as amended;

               (viii)  Assuming that each of this Agreement and the Custody
          Agreement has been duly authorized, executed and delivered by each
          party hereto (other than such Selling Shareholder), each of this
          Agreement and the Custody Agreement constitutes a valid and legally
          binding obligation of each Selling Shareholder, enforceable against
          such Shareholder in accordance with its terms;

               (ix)  The sale of the Securities by the Selling Shareholders and
          the compliance by the Selling Shareholders with all of the provisions
          of this Agreement and the Custody Agreement will not breach or result
          in a default under any indenture, mortgage, deed of trust, loan
          agreement or other agreement or instrument identified on an annexed
          schedule furnished to such counsel by the Company, nor will such
          action violate any Federal or New York statute or any rule or
          regulation that has been issued pursuant to any Federal or New York
          statute or any order known to such counsel issued pursuant to any
          Federal or New York statute by any court or governmental agency or
          body or court having jurisdiction over the Company or any of its
          respective properties; and

                                      15
<PAGE>

               (x) Assuming that each Selling Shareholder has full power, right
          and authority to sell the Securities to be sold by such Selling
          Shareholder, and upon payment for and delivery of the Securities in
          accordance with this Agreement, the Underwriters will acquire a
          security entitlement with respect to such Securities and no action
          based on an adverse claim may be asserted against the Underwriters.

          Such counsel shall state that the opinions set forth in paragraphs
(ii), (iv), (viii) and (ix) above are subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.

          Such counsel shall also state that such counsel has not independently
verified the accuracy, completeness or fairness of the statements made or
included in the Registration Statement or Prospectuses, and takes no
responsibility therefor, except as and to the extent set forth in paragraphs
(iii) and (vi) above.  Such counsel shall state that in the course of the
preparation by the Company of the Registration Statement and the Prospectuses,
such counsel participated in conferences with certain officers and employees of
the Company, with representatives of [           ] and with counsel to the
Company.  Such counsel shall state that based upon such counsel's examination of
the Registration Statement and the Prospectuses, such counsel's investigations
made in connection with the preparation of the Registration Statement and the
Prospectuses and such counsel's participation in the conferences referred to
above, such counsel has no reason to believe that the Registration Statement as
of its effective date and the Prospectuses as of their respective dates or the
Closing Date, contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, except
that in each case such counsel expresses no belief with respect to the financial
statements or other financial data contained or incorporated by reference in the
Registration Statement or any Prospectus.

          Such counsel may also state that such counsel is a member of the Bar
of the State of New York and such counsel does not express any opinion therein
concerning any law other than the law of the State of New York, the Federal law
of the United States and the Delaware General Corporation Law.  Such counsel may
also state that, in addition, such counsel does not express any opinion with
regard to any New York or Federal law regulating telecommunications activities
or any rules or regulations promulgated by any New York or Federal agency
(including, without limitation, the Federal Communications Commission)
thereunder.

          In rendering such opinion, such counsel may rely as to matters of
fact, to the extent they deem proper, on certificates of responsible officers of
the Company and public officials.  Such counsel may also make such assumptions
and qualifications as they deem proper.

                                      16
<PAGE>

          (c) The Underwriters shall have received on the Closing Date an
     opinion of Appleby, Spurling & Kempe, Bermuda counsel to the Company, dated
     the Closing Date and addressed to the Underwriters to the effect that:

               (i) Each of the Company and each Subsidiary organized under the
          laws of Bermuda as listed on a schedule to the opinion (each, a
          "Bermuda Subsidiary" and together the "Bermuda Subsidiaries") is a
          company duly organized, validly existing and in good standing under
          the laws of Bermuda and has the requisite power to conduct its
          business and authority to own its properties as described in the
          Registration Statement or the Prospectuses and to enter into and
          perform the respective terms and conditions of this Agreement and, in
          the case of the Company, to constitute and issue the Securities;

               (ii) Based solely on an Officer's Certificate of the Company,
          each of the Company and each Bermuda Subsidiary is duly registered and
          qualified to conduct its business and is in good standing in each
          jurisdiction or place where the nature of its properties or the
          conduct of its business requires such registration or qualification,
          except where the failure so to register or qualify or to be in good
          standing would not have a Material Adverse Effect;

               (iii)  The Company has taken all necessary action to authorize
          the execution and delivery of the Operative Documents and the
          performance by it of the transactions contemplated therein;

               (iv) The Company has taken all necessary action to authorize the
          issuance and delivery of the Securities and the performance by it of
          the transactions contemplated therein;

               (v) The issuance by the Company of the Securities and the
          execution and delivery by the Company of, and the performance of its
          obligations under and compliance with the provisions of, the Operative
          Documents (including, without limitation, the amendment of the Bye-
          Laws to incorporate the terms of the Preferred Stock and the filing of
          the Certificate of Designations with the Bermuda Monetary Authority)
          will not:

                    (a) violate any provision of any applicable law of Bermuda,
               nor, as far as can be ascertained from public records, any
               regulation of any governmental, judicial or public body or
               authority of or in Bermuda;

                    (b) violate the Memorandum of Association or Bye-laws of the
               Company; or

                                      17
<PAGE>

                    (c) result in the creation or imposition of any lien, charge
               or encumbrance upon any property or assets of the Company or the
               Bermuda Subsidiaries;

               (vi) The Operative Documents  constitute legal, valid and binding
          obligations of the Company, enforceable against the Company in
          accordance with its terms;

               (vii)  All the outstanding shares of Common Stock of the Company
          have been duly authorized and validly issued, are fully paid and
          nonassessable and are free of any preemptive or similar rights; the
          Common Stock to be converted from the Preferred Stock shall have been
          duly authorized and, when issued and delivered to the holders of
          Securities against payment therefor in accordance with the terms of
          the Preferred Stock, will be validly issued, fully paid and
          nonassessable and free of any preemptive or similar rights; and the
          capital stock of the Company conforms to the description thereof in
          the Prospectuses;

               (viii)  Other than as specified in such opinion, there is no
          registration or filing with, or consent, license, approval,
          declaration, permission, authorization, exemption or similar
          instrument of, or the taking of any other action by, any person in
          Bermuda which is required in connection with the issuance of the
          Securities or the execution, delivery or performance of this
          Agreement, or to ensure the legality, validity, enforceability or
          admissibility in evidence of this Agreement in Bermuda;

               (ix) Neither the Company nor any of its respective properties or
          assets enjoys any rights of immunity from legal proceedings in
          Bermuda, or from the execution of judgment upon or attachment of such
          property or assets or otherwise;

               (x) The choice of the laws of the State of New York to govern
          this Agreement is a proper, valid and binding choice of law and will
          be recognized and applied by the Courts of Bermuda, assuming that such
          choice of law is a valid and binding choice of law under the laws of
          the State of New York and provided that (i) the point is specifically
          pleaded; and (ii) recognition would not be contrary to public policy
          as that term is understood under Bermuda law;

               (xi) The irrevocable submission by the Company to the
          jurisdiction of the New York State and Federal courts sitting in New
          York for the purposes of all legal actions and proceedings instituted
          in connection with

                                      18
<PAGE>

          the Securities and as provided for in this Agreement and the
          appointment of the Process Agent contained in this Agreement
          constitutes the legal, valid and binding obligation of the Company,
          provided that such submission and appointment is accepted by such
          courts and, with respect to the appointment of the Process Agent,
          provided that no other procedural requirements are necessary in order
          to validate such appointment;

               (xii)  A final and conclusive judgment of the United States
          Federal or New York State courts under which a sum of money is payable
          (not being a sum payable in respect of taxes or other charges of a
          like nature in respect of a fine or other penalty, or in respect of
          multiple damages as defined in the Protection of Trading Interests Act
          1981), may be the subject of enforcement proceedings in the Supreme
          Court of Bermuda without re-examination of the merits of the case
          under the common law doctrine of obligation by action on the debt
          evidenced by the foreign court's judgment.  On general principles, we
          would expect such proceedings to be successful provided that the court
          which gave the judgment was competent to hear the action in accordance
          with private international law principles as applied in Bermuda and
          the judgment is not contrary to public policy in Bermuda, has not been
          obtained by fraud or in proceedings contrary to natural justice and is
          not based on an error in Bermuda law.  Enforcement of such a judgment
          against assets in Bermuda may involve the conversion of the judgment
          debt into Bermuda dollars but the Bermuda Monetary Authority has
          indicated that its present policy is to give the consents necessary to
          enable recovery in the currency of the obligation;

               (xiii)  The statements in the Prospectuses under the captions
          "Service of Process and Enforcement of Liabilities," "Certain Income
          Tax Consequences-Bermuda Tax Considerations," and "-Taxation of
          Holders of [Common Stock][Preferred Stock]-Bermuda Tax Considerations"
          insofar as they purport to describe the provisions of the laws of
          Bermuda referred to therein, are accurate and correct in all material
          respects; and

               (xiv)  No stamp or other issuance or transfer taxes or duties and
          no capital gains, income, withholding or other taxes are payable by or
          on behalf of the Underwriters to the Bermuda Government or to any
          political subdivision or taxing authority thereof or therein in
          connection with the execution of this Agreement or the issuance of the
          Securities.

          In rendering such opinion, such counsel may rely as to matters of
fact, to the extent they deem proper, on certificates of responsible officers of
the Company and public officials.  Such counsel may also make such assumptions
and qualifications as they deem proper.  Such opinion shall

                                      19
<PAGE>

also state that it may be relied upon by Latham & Watkins, as if it were
addressed to them, for the purposes of any legal opinion that such firm may be
asked to deliver pursuant to this Agreement.

          (d) The Underwriters shall have received on the Closing Date an
     opinion of       [               ], special U.S. regulatory counsel to the
     Company, dated the Closing Date and addressed to the Underwriters to the
     effect that:

               (i) Except for such FCC consents, approvals, authorizations, or
          orders that have already been obtained, no material consent, approval,
          authorization, or order of the FCC is required to be obtained by the
          Company under the Communications Laws for the consummation of the
          transactions contemplated under this Agreement, except that, from time
          to time, the Company, may be required to obtain certain FCC
          authorizations that would be required in the ordinary course of
          business.

               (ii)  The execution and delivery of, and the consummation of the
          transactions contemplated under, this Agreement by the Company do not
          and will not materially violate any provision of the Communications
          Laws.

               (iii)  The statements made under the captions "Business--
          Regulation" and "Risk Factors and Forward-Looking Statements--Our
          operations are subject to regulation int he United States and abroad
          and require us to obtain and maintain a number of governmental
          licenses and permits.  If we fail to comply with those regulatory
          requirements or obtain and maintain those licenses and permits, we may
          not be able to conduct our business" in the Company's annual report on
          Form 10-K for the year ended December 31, 1999, incorporated by
          reference in the Registration Statement, insofar as such statements
          purport to constitute a summary of the material regulatory matters
          covered therein under the Communications  Laws, fairly present the
          information contained therein in light of the subject matter of such
          Statements and the circumstances in which such Statements were made.

          In rendering such opinion, such counsel may rely as to matters of
fact, to the extent they deem proper, on certificates of responsible officers of
the Company, other Subsidiaries and public officials.  Such counsel may also
make such assumptions and qualifications as they deem proper.

          All references in these Sections 5(b), (c) and (d) to the Prospectuses
     shall be deemed to include any amendment or supplement thereto at the
     Closing Date.

          (e) The Underwriters shall have received from Latham & Watkins,
     Counsel for the Underwriters an opinion, dated the Closing Date, with
     respect to the issuance and sale of the Securities, the Registration
     Statement and the Prospectuses (as amended or supplemented at the Closing
     Date) and other related matters as the Underwriters may

                                      20
<PAGE>

     reasonably require, and the Company shall have furnished to such counsel
     such documents as they request for the purpose of enabling them to pass
     upon such matters.

               (f) The Company shall have furnished to the Underwriters a
          certificate of the Company, signed by either the Co-Chairman of the
          Board or the Chief Executive Officer and the principal acting
          financial or accounting officer of such entity, dated the Closing
          Date, to the effect that the signers of such certificate have
          carefully examined the Registration Statement, the Prospectuses, any
          amendment or supplement thereto and this Agreement and that:

               (i) the representations and warranties of the Company set forth
          in this Agreement are true and correct on and as of the Closing Date
          with the same effect as if made on the Closing Date, and the Company
          have complied with all the agreements and satisfied all the conditions
          on its part to be performed or satisfied hereunder at or prior to the
          Closing Date; and since the date of the most recent financial
          statements included in the Registration Statement and the
          Prospectuses, there has been no material adverse change in the
          business, assets, condition (financial or otherwise) or results of
          operations of the Company or the Subsidiaries, taken as a whole,
          whether or not arising from transactions in the ordinary course of
          business, except as set forth in or contemplated by the Registration
          Statement or the Prospectuses (exclusive of any amendment or
          supplement thereto).

          (g) On the Pricing Date, [                     ] shall have furnished
     to the Underwriters a "comfort" letter, dated as of the Pricing Date, in
     form and substance satisfactory to the Underwriters, and on the Closing
     Date [                ] shall have furnished to the Underwriters a "bring-
     down comfort" letter, dated the Closing Date, in form and substance
     satisfactory to the Underwriters.

          (h) Subsequent to the Execution Time or, if earlier, the dates as of
     which information is given in the Prospectuses, there shall not have been
     any change, or any development involving a prospective change, in or
     affecting the business or properties of the Company or the Subsidiaries,
     taken as a whole, the effect of which is, in the reasonable judgment of the
     Underwriters, so material and adverse as to make it impractical or
     inadvisable to market the Securities as contemplated by the Prospectuses.

          (i) No stop order suspending the effectiveness of the Registration
     Statement shall have been issued and no proceedings for that purpose shall
     have been taken or, to the knowledge of the Company, shall have been
     contemplated by the Commission at or prior to the Closing Date;

          (j) Prior to the Closing Date, the Company shall have furnished to the
     Underwriters such further information, certificates and documents as the
     Underwriters may reasonably request.

                                      21
<PAGE>

          (k) The Securities shall have been approved for listing, subject to
     notice of issuance, on the [                                ].

          (l) The Company shall have (i) authorized and executed the Certificate
     of Designations in form and substance reasonably satisfactory to the
     Underwriters and (ii) authorized the amendment of, and amended, the Bye-
     laws to incorporate the terms of the Preferred Stock, in each case in
     accordance with Bermuda law, and the Underwriters shall have received
     original copies thereof, duly executed by the Company.

          If any of the conditions specified in this Section 5 shall not have
been fulfilled when and as provided in this Agreement, or if any of the opinions
and certificates mentioned above or elsewhere in this Agreement shall not be
reasonably satisfactory in form and substance to the Underwriters and Counsel
for the Underwriters, this Agreement and all obligations of the Underwriters
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Underwriters.  Notice of such cancellation shall be given to the Company in
writing or by telephone or telegraph confirmed in writing.

          The documents required to be delivered by this Section 5 will be
delivered at the office of Counsel for the Underwriters at 885 Third Avenue, New
York, New York, on the Closing Date.

          6.  Reimbursement of Expenses.  If the sale of the Securities provided
              -------------------------
for herein is not consummated because any condition to the obligations of the
Underwriters set forth in Section 6 hereof is not satisfied or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters in payment for the Securities on the Closing
Date, the Company agrees to reimburse the Underwriters severally upon demand for
all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed
purchase and sale of the Securities.

          7.  Indemnification and Contribution.
              --------------------------------

          (a) The Company hereby agrees to indemnify and hold harmless each
     Underwriter, the directors, officers, employees and agents of each
     Underwriter and each person who controls any Underwriter within the meaning
     of either the Securities Act or the Exchange Act against any and all
     losses, claims, damages or liabilities, joint or several, to which they or
     any of them may become subject under the Securities Act, the Exchange Act
     or other Federal or state statutory law or regulation, at common law or
     otherwise, insofar as such losses, claims, damages or liabilities (or
     actions in respect thereof) arise out of or are based upon any untrue
     statement or alleged untrue statement of a material fact contained in the
     Registration Statement or any Prospectus or Prepricing Prospectus or in any
     amendment thereof or supplement thereto, or arise out of or are based upon
     the omission or alleged

                                      22
<PAGE>

     omission to state therein a material fact required to be stated therein or
     necessary to make the statements therein, in the light of the circumstances
     under which they were made, not misleading, and agree to reimburse each
     such indemnified party, as incurred, for any legal or other expenses
     reasonably incurred by them in connection with investigating or defending
     any such loss, claim, damage, liability or action; provided, however, that
                                                        --------  -------
     the Company will not be liable in any such case to the extent that any such
     loss, claim, damage or liability arises out of or is based upon any such
     untrue statement or alleged untrue statement or omission or alleged
     omission (i) made in the Registration Statement or any Prospectus or
     Prepricing Prospectus, or in any amendment or supplement thereto, in
     reliance upon and in conformity with written information furnished to the
     Company by the Underwriters or any Selling Shareholder specifically for
     inclusion therein or (ii) made in the Prepricing Prospectus if such untrue
     statement or alleged untrue statement or omission or alleged omission made
     in the Prepricing Prospectus is eliminated or remedied in the Prospectus
     (as amended or supplemented, if applicable) and a copy of the Prospectus
     shall not have been furnished to the person asserting such loss, claim,
     damage or liability at or prior to the written confirmation of the sale of
     Securities to such person. This indemnity agreement will be in addition to
     any liability which the Company may otherwise have.

          (b)  Each Selling Shareholder severally agrees to indemnify and hold
     harmless each Underwriter, the directors, officers, employees and agents of
     each Underwriter and each person who controls any Underwriter within the
     meaning of either the Securities Act or the Exchange Act to the same extent
     as the foregoing indemnity from the Company to each Underwriter, but only
     with reference to written information relating to such Selling Shareholder
     furnished to the Company by or on behalf of such Selling Shareholder
     specifically for inclusion in the Registration Statement, Prospectus or
     Prepricing Prospectus (or in any amendment or supplement thereto).
     Notwithstanding the foregoing, the aggregate liability of any Selling
     Shareholder pursuant to the provisions of this paragraph shall be limited
     to an amount equal to the sum of the products, with respect to each type of
     Security sold by such Selling Shareholder, of the initial public offering
     price of such Security and the number of such Securities sold by such
     Selling Shareholder.  This indemnity agreement will be in addition to any
     liability which any Selling Shareholder may otherwise have, including as a
     controlling stockholder of the Company.

          (c) Each Underwriter severally agrees to indemnify and hold harmless
     the Company, its directors, officers, employees and agents, each person who
     controls the Company within the meaning of either the Securities Act or the
     Exchange Act, the Selling Shareholders and each person, if any, who
     controls any of the Selling Shareholders within the meaning of Section 15
     of the Securities Act or Section 20(a) of the Exchange Act, to the same
     extent as the foregoing indemnity from the Company and the Selling
     Shareholders to each Underwriter, but only with reference to written
     information relating to such Underwriter furnished to the Company by or on
     behalf of such Underwriter specifically for inclusion in the Prepricing
     Prospectus, the Prospectus or the Registration Statement (or in any
     amendment or supplement thereto).  This indemnity agreement will be in
     addition to any

                                      23
<PAGE>

     liability which any Underwriter may otherwise have. The Company and the
     Selling Shareholders acknowledge for all purposes under this Section 7
     (including Section 7(a) and (b) above) that the statements set forth in [ ]
     in the Prospectus, constitute the only information furnished in writing by
     the Underwriters for inclusion in the Preliminary Prospectus or the
     Prospectus (or in any amendment or supplement thereto).

          (d) Promptly after receipt by an indemnified party under this Section
     7 of notice of the commencement of any action, such indemnified party will,
     if a claim in respect thereof is to be made against the indemnifying party
     under this Section 7, notify the indemnifying party in writing of the
     commencement thereof; but the failure so to notify the indemnifying party
     (i) will not relieve it from liability under paragraph (a), (b) or (c)
     above unless and to the extent it did not otherwise learn of such action
     and such failure results in the forfeiture by the indemnifying party of
     substantial rights and defenses and (ii) will not, in any event, relieve
     the indemnifying party from any obligations to any indemnified party other
     than the indemnification obligation provided in paragraph (a), (b) or (c)
     above.  The indemnifying party shall be entitled to appoint counsel of the
     indemnifying party's choice at the indemnifying party's expense to
     represent the indemnified party in any action for which indemnification is
     sought (in which case the indemnifying party shall not thereafter be
     responsible for the fees and expenses of any separate counsel retained by
     the indemnified party or parties except as set forth below); provided,
     however, that such counsel shall be satisfactory to the indemnified party.
     Notwithstanding the indemnifying party's election to appoint counsel to
     represent the indemnified party in an action, the indemnified party shall
     have the right to employ separate counsel (including local counsel), and
     the indemnifying party shall bear the reasonable fees, costs and expenses
     of such separate counsel if (i) the use of counsel chosen by the
     indemnifying party to represent the indemnified party would present such
     counsel with a conflict of interest, (ii) the actual or potential
     defendants in, or targets of, any such action include both the indemnified
     party and the indemnifying party and the indemnified party shall have
     reasonably concluded that there may be legal defenses available to it
     and/or other indemnified parties which are different from or additional to
     those available to the indemnifying party, (iii) the indemnifying party
     shall not have employed counsel satisfactory to the indemnified party to
     represent the indemnified party within a reasonable time after notice of
     the institution of such action or (iv) the indemnifying party shall
     authorize the indemnified party to employ separate counsel at the expense
     of the indemnifying party. It is understood that the indemnifying party
     shall not, in connection with any proceeding or related proceeding in the
     same jurisdiction, be liable for the fees and expenses of more than one
     separate firm (in addition to any local counsel) for all indemnified
     parties, and that all such fees and expenses shall be reimbursed as they
     are incurred.  Any such separate firm for the Underwriters and such control
     persons shall be designated in writing by the first of the named
     Underwriters on Schedule II hereto and any such separate firm of the
                     -----------
     Company, its directors, its officers, any such control persons of the
     Company and the Selling Shareholders shall be designated in writing by the
     Company and the Selling Shareholders.  An indemnifying party will not,
     without the prior written consent of the indemnified parties, settle or
     compromise or consent to the entry of any judgment with

                                      24
<PAGE>

     respect to any pending or threatened claim, action, suit or proceeding in
     respect of which indemnification or contribution may be sought hereunder
     (whether or not the indemnified parties are actual or potential parties to
     such claim or action) unless such settlement, compromise or consent
     includes an unconditional release of each indemnified party from all
     liability arising out of such claim, action, suit or proceeding.

          (e) In the event that the indemnity provided in paragraph (a), (b) or
     (c) of this Section 7 is unavailable to hold harmless an indemnified party
     for any reason, the Company, the Selling Shareholders and the Underwriters
     agree to contribute to the aggregate losses, claims, damages and
     liabilities (including legal or other expenses reasonably incurred in
     connection with investigating or defending same) (collectively, "Losses")
                                                                      ------
     to which the Company, the Selling Shareholders and one or more of the
     Underwriters may be subject in such proportion as is appropriate to reflect
     the relative benefits received by the Company and the Selling Shareholders,
     on the one hand, and by the Underwriters, on the other hand, from the
     offering of the Securities; provided, however, that in no case shall any
     Underwriter (except as may be provided in any agreement among the
     Underwriters relating to the offering of the Securities) be responsible for
     any amount in excess of the purchase discount or commission applicable to
     the Securities purchased by such Underwriter hereunder.  If the allocation
     provided by the immediately preceding sentence is unavailable for any
     reason, the Company, the Selling Shareholders and the Underwriters shall
     contribute in such proportion as is appropriate to reflect not only such
     relative benefits but also the relative fault of the Company and the
     Selling Shareholders, on the one hand, and of the Underwriters, on the
     other hand, in connection with the statements or omissions which resulted
     in such Losses as well as any other relevant equitable considerations.
     Benefits received by the Company and the Selling Shareholders shall be
     deemed to be equal to the total net proceeds from the offering (before
     deducting expenses), and benefits received by the Underwriters shall be
     deemed to be equal to the total purchase discounts and commissions received
     by the Underwriters from the Company in connection with the purchase of the
     Securities hereunder.  Relative fault shall be determined by reference to
     whether any alleged untrue statement or omission relates to information
     provided by the Company or the Selling Shareholders, on the one hand, or by
     the Underwriters, on the other hand, and the parties' relative intent,
     knowledge, access to information and opportunity to correct or prevent such
     statement or omission.  The Company and the Underwriters agree that it
     would not be just and equitable if contribution were determined by pro rata
     allocation or any other method of allocation which does not take account of
     the equitable considerations referred to above.  Notwithstanding the
     provisions of this paragraph (d), no person guilty of fraudulent
     misrepresentation (within the meaning of Section 11(f) of the Securities
     Act) shall be entitled to contribution from any person who was not guilty
     of such fraudulent misrepresentation.  For purposes of this Section 7, (i)
     each person who controls an Underwriter within the meaning of either the
     Securities Act or the Exchange Act and each director, officer, employee and
     agent of an Underwriter shall have the same rights to contribution as such
     Underwriter, (ii)  each person who controls the Company within the meaning
     of either the Securities Act or the Exchange Act and each officer and
     director of the Company shall have

                                      25
<PAGE>

     the same rights to contribution as the Company and (iii) each person, if
     any, who controls any of the Selling Shareholders within the meaning of
     either the Securities Act or the Exchange Act shall have the same rights to
     contribution as such Selling Shareholder, subject in each case to the
     applicable terms and conditions of this paragraph (e). The remedies
     provided in this Section 7 are not exclusive and shall not limit any rights
     or remedies which may otherwise be available to any indemnified party at
     law or in equity.

          8.  Default by an Underwriter.  If any one or more Underwriters shall
              -------------------------
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter hereunder, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the
aggregate principal amount of Firm Shares to be purchased set forth opposite
their names on Schedule II hereto bears to the number of Firm Shares set forth
               -----------
opposite the names of the remaining Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate principal amount of the Firm
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate principal amount of the Firm Shares
set forth on Schedule I hereto, the remaining Underwriters shall have the right
to purchase all, but shall not be under any obligation to purchase any, of the
Securities, and if such non-defaulting Underwriters do not purchase all the
Securities, this Agreement will terminate without liability to any non-
defaulting Underwriter or the Company.  In the event of a default by an
Underwriter as set forth in this Section 8, the Closing Date shall be postponed
for such period, not exceeding seven days, as the Underwriters shall determine
in order that the required changes in the Registration Statement, Prospectuses
or in any other documents or arrangements may be effected.  Nothing contained in
this Agreement shall relieve any defaulting Underwriter of any liability it may
have to the Issuers or the non-defaulting Underwriter for damages occasioned by
its default hereunder.

          9.  Termination.  This Agreement shall be subject to termination in
              -----------
the absolute discretion of the Underwriters, by notice given to the Company
prior to delivery of and payment for the Securities, if prior to such time (i)
trading in securities generally on the New York Stock Exchange shall have been
suspended or limited or minimum prices shall have been established on such
exchange, (ii) a banking moratorium shall have been declared either by Federal
or New York State authorities or (iii) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States or Bermuda of a
national emergency or war or other calamity or crisis the effect of which on
financial markets is such as to make it, in the judgment of the Underwriters,
impracticable or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement or any Prospectus.

          10.  Representations and Indemnities to Survive.  The respective
               ------------------------------------------
agreements, representations, warranties and indemnities of the Company and its
officers and of the Underwriters set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or
on behalf of the Underwriters or the Company or any of its officers, directors
or controlling persons referred to in Section 7 hereof, and will survive
delivery of and

                                      26
<PAGE>

payment for the Securities. The provisions of Sections 6 and 7 hereof shall
survive the termination or cancellation of this Agreement.

          11   Notices.  All communications hereunder will be in writing and
               -------
effective only on receipt, and, if sent to the Underwriters, will be mailed,
delivered or sent via facsimile and confirmed to them, care of [
]; if sent to the Selling Shareholders, to their respective addresses set forth
opposite their respective signatures in this Agreement; or, if sent to the
Company, will be mailed, delivered or sent via facsimile and confirmed to it at
Wessex House, 45 Reid Street, Hamilton HM 12 Bermuda, attention: Secretary of
the Company.

          12   Successors.  This Agreement will inure to the benefit of and be
               ----------
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7 hereof, and no
other person will have any right or obligation hereunder.

          13   Applicable Law.  This Agreement will be governed by and construed
               --------------
in accordance with the laws of the State of New York.

          14   Business Day.  For purposes of this Agreement, "business day"
               ------------
means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on
which banking institutions in The City of New York, New York are authorized or
obligated by law, executive order or regulation to close.

          15   Counterparts.  This Agreement may be executed in one or more
               ------------
counterparts, each of which will be deemed to be an original, but all such
counterparts will together constitute one and the same instrument.

          16   Submission to Jurisdiction; Appointment of Agents for Service;
               --------------------------------------------------------------
Currency Indemnity.
- ------------------

          (a) To the fullest extent permitted by applicable law, the Company and
     each Selling Shareholder irrevocably submits to the jurisdiction of any
     Federal or State court located in the Borough of Manhattan in The City of
     New York, New York in any suit, action or proceeding based on or arising
     out of or relating to this Agreement, the Securities and irrevocably agrees
     that all claims in respect of such suit or proceeding may be determined in
     any such court.  The Company and each Selling Shareholder irrevocably
     waives, to the fullest extent permitted by law, any objection which it may
     have to the laying of the venue of any such suit, action or proceeding
     brought in such a court and any claim that any suit, action or proceeding
     brought in such a court has been brought in an inconvenient forum.  The
     Company and each Selling Shareholder agrees that final judgment in any such
     suit, action or proceeding brought in such a court shall be conclusive and
     binding upon the Company and such Selling Shareholder and may be enforced
     in the courts of Bermuda (or any other courts to the jurisdiction of which
     the Company is subject) by a suit upon such judgment, provided that service
                                                           --------
     of process is effected upon the Company and such Selling Shareholder in the

                                      27
<PAGE>

     manner specified herein or as otherwise permitted by law.  The Company and
     each Selling Shareholder hereby irrevocably designates and appoints CT
     Corporation System, 1633 Broadway - 23rd Floor, New York, New York (the
     "Process Agent") as the authorized agent of the Company and such Selling
     --------------
     Shareholder upon whom process may be served in any such suit or proceeding,
     it being understood that the designation and appointment of the Process
     Agent as such authorized agent shall become effective immediately without
     any further action on the part of the Company and such Selling Shareholder.
     The Company and each Selling Shareholder represents to the Underwriters
     that they have notified the Process Agent of such designation and
     appointment and that the Process Agent has accepted the same in writing.
     The Company and each Selling Shareholder irrevocably authorizes and directs
     the Process Agent to accept such service.  The Company and each Selling
     Shareholder further agrees that service of process upon the Process Agent
     and written notice of said service to the Company and such Selling
     Shareholder mailed by prepaid registered first class mail or delivered to
     the Process Agent at its principal office shall be deemed in every respect
     effective service of process upon the Company and such Selling Shareholder
     in any such suit or proceeding.  Nothing herein shall affect the right of
     the Underwriters or any person controlling the Underwriters to serve
     process in any other matter permitted by law.  The Company and each Selling
     Shareholder further agrees to take any and all action, including the
     execution and filing of any and all such documents and instruments as may
     be necessary to continue such designation and appointment of the Process
     Agent in full force and effect so long as the Company and such Selling
     Shareholder has any outstanding obligations under this Agreement and  the
     Securities.  To the extent that the Company and any Selling Shareholder has
     or hereafter may acquire any immunity from jurisdiction of any court or
     from any legal process (whether through service of note, attachment prior
     to judgment, attachment in aid of execution, executor or otherwise) with
     respect to itself or its property, the Company and such Selling Shareholder
     hereby irrevocably waives such immunity in respect of its obligations under
     this Agreement, to the extent permitted by law.

          (b) The obligation of the parties to make payments hereunder for the
     Securities in U.S. dollars (the "Obligation Currency") and such obligation
                                      -------------------
     shall not be discharged or satisfied by any tender or recovery pursuant to
     any judgment expressed in or converted into any currency other than the
     Obligation Currency or any other realization in such other currency,
     whether as proceeds of set-off, security, guarantee, distributions, or
     otherwise, except to the extent such tender, recovery or realization shall
     result in the effective receipt by the party which is to receive such
     payment (as an additional, separate and independent obligation) for the
     amount (if any) by which such effective receipt is less that the full
     amount of the Obligation Currency payable hereunder and such obligation to
     indemnify shall not be affected by judgment being obtained for any other
     sums due under this Agreement.

          If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement and your acceptance shall represent a binding agreement between
the Company, the Selling Shareholders and the Underwriters.

                                      28
<PAGE>

                  [Underwriting Agreement Signature Pages Follow]

                                      29
<PAGE>

                                        Very truly yours,


                                        Global Crossing Ltd.


                                        By___________________________
                                          Name:
                                          Title:


                                        Each of the Selling Shareholders
                                        named in Scheduled I hereto

                                        By___________________________
                                           Attorney-in-fact

                                        By___________________________
                                           Attorney-in-fact



The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

[                     ]


By:       [                ]



By:____________________________
   Name:
   Title:

By:    [                   ]



By:____________________________
   Name:
   Title:

For themselves and the other Underwriters

                                      30
<PAGE>

                                  SCHEDULE I


                                      31
<PAGE>

                                  SCHEDULE II



   Underwriters                                         Number of Firm
   ------------                                     Shares to be Purchased
                                                    ----------------------

<PAGE>

                                                                    EXHIBIT 23.1

                   CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS


   As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or incorporated by
reference in this Registration Statement on Form S-3.

                                          /s/ Arthur Andersen



March 29, 2000
Hamilton, Bermuda

<PAGE>

                                                                    EXHIBIT 23.2

                      CONSENT OF INDEPENDENT ACCOUNTANTS

  We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 1 to the Registration Statement on Form S-3 (File No. 333-32810)
of Global Crossing Ltd. of our report dated January 25, 1999 relating to the
financial statements, which appears in Frontier Corporation's 1998 Annual Report
to Shareholders, which is incorporated by reference in its Annual Report on Form
10-K for the year ended December 31, 1998, and which appears on Page 20 of the
Frontier Corporation Current Report on Form 8-K dated January 26, 1999. We also
consent to the incorporation by reference of our report dated January 25, 1999
relating to the financial statement schedule, which appears in such Annual
Report on Form 10-K. We also consent to the reference to us under the heading
"Experts" and "Selected Historical Financial Information" in such Registration
Statement.



/s/ PricewaterhouseCoopers LLP
- ----------------------------------
PricewaterhouseCoopers LLP

Rochester, New York
March 29, 2000

<PAGE>

                                                                    EXHIBIT 23.3

                        CONSENT OF INDEPENDENT AUDITORS

  We consent to the inclusion of our report dated 26 May 1999 with respect to
the balance sheets of Cable & Wireless Global Marine as of 31 March 1999 and
1998 and the results of their operations and cashflows for each of the years in
the three-year period ended 31 March 1999, incorporated by reference into the
Post-Effective Amendment No. 1, dated 31 March 2000 to this Registration
Statement on Form S-3 (333-32810), of Global Crossing Ltd. and to the references
to our firm under the headings "Experts" and "Global Marine Systems selected
historical financial information" in the Post-Effective Amendment No. 1 to this
Registration Statement.


                                               Yours faithfully

                                                         /s/ KPMG Audit Plc
                                               -------------------------------
                                                         KPMG Audit Plc
Ipswich, England

March 29, 2000

<PAGE>

                                                                    EXHIBIT 23.4


                        CONSENT OF INDEPENDENT AUDITORS

  We consent to the incorporation by reference in this Amendment
No. 1 to Registration Statement No. 333-32810 on Form S-3 of our report dated 8
October 1999, (2 December 1999 as to note 5 and 17 December 1999 as to notes 29,
30, 31 and 32) on the combined balance sheets of Racal Telecommunications
Limited, Racal Telecommunications Networks Limited, Racal Internet Services
Limited and Racal Telecommunications Inc. (collectively "Racal Telecom") as of
31 March 1999 and 1998 and the combined profit and loss accounts and combined
cash flow statements for each of the years in the three year period ended 31
March 1999, appearing in the current report on Form 8-K of Global Crossing Ltd.
and to the references to our firm under the headings "Experts" and "Racal
Telecom selected historical financial information" in this Registration
Statement.



                                               /s/ Deloitte & Touche
                                               -------------------------------
                                                   Deloitte & Touche
London, England

March 29, 2000

<PAGE>

                                                                    EXHIBIT 23.5


                      CONSENT OF INDEPENDENT ACCOUNTANTS

  We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of Global Crossing Ltd. of our report dated December 15,
1999 relating to the financial statements of HCL Holdings Limited for each of
the three years ended December 31, 1998. We also consent to the reference to us
under the heading "Experts" in such registration statement.



/s/ PricewaterhouseCoopers
- ----------------------------------
PricewaterhouseCoopers

Hong Kong
March 29, 2000


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