MCI WORLDCOM INC, SC 13D, 1998-12-21

MCI WORLDCOM INC
SC 13D, 1998-12-21
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Rule 13d-101)

Information to be included in statements filed pursuant
to 13d-1(a) and amendments thereto filed pursuant to 13d-2(a)

OzEmail Limited
- ----------------------------------------------------------------------------
(Name of Issuer)

Ordinary Shares
- ----------------------------------------------------------------------------
(Title of Class of Securities)

[none]
-------------
(CUSIP Number)

Charles T. Cannada
Senior Vice President, Corporate Development
MCI WORLDCOM, Inc.
515 East Amite Street
Jackson, Mississippi 39201
(601) 360-8600
- -----------------------------------------------------------------------------
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and Communications)

with copies to:

R. Randall Wang, Esq. Martina W. Knee, Esq.
Bryan Cave LLP UUNet Technologies, Inc.
One Metropolitan Square 3060 Williams Drive
Suite 3600 Fairfax, Virginia 22031
St. Louis, Missouri 63102 (703) 206-5600
(314) 259-2149

December 11, 1998
------------------------------
(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13-d-1(e), 13d-1(f) or 13d-1(g), check the following
box [__].

(Continued on following pages)

(Page 1 of 24 Pages)

<PAGE>

CUSIP No. [none] SCHEDULE 13D Page 2 of 24 Pages

1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
UUNet Holdings Australia Pty Limited (00-0000000)

- ----------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) X
(b) ___
- ----------------------------------------------------------------------------
3 SEC USE ONLY
- ----------------------------------------------------------------------------
4 SOURCE OF FUNDS* WC & BK
- ----------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)___
- -----------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION New South Wales, Australia
- -----------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER 21,863,174
SHARES -----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER -0-
OWNED BY EACH -----------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER 21,863,174
PERSON WITH -----------------------------------------------------
10 SHARED DISPOSITIVE POWER -0-
- -----------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

21,863,174 ordinary shares
- -----------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* ___
- -----------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 14.9%
- -----------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* CO
- -----------------------------------------------------------------------------

*SEE INSTRUCTIONS BEFORE FILLING OUT!

<PAGE>

CUSIP No. [none] SCHEDULE 13D Page 3 of 24 Pages

1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
UUNET Technologies, Inc. 54-1543611

- ----------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) X
(b) ___
- ----------------------------------------------------------------------------
3 SEC USE ONLY
- ----------------------------------------------------------------------------
4 SOURCE OF FUNDS* WC & BK
- ----------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)___
- -----------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
- -----------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER 21,863,174
SHARES -----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER -0-
OWNED BY EACH -----------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER 21,863,174
PERSON WITH -----------------------------------------------------
10 SHARED DISPOSITIVE POWER -0-
- -----------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

*SEE INSTRUCTIONS BEFORE FILLING OUT!

<PAGE>

CUSIP No. [none] SCHEDULE 13D Page 4 of 24 Pages

1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MCI WORLDCOM, Inc. 58-1521612

- ----------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) X
(b) ___
- ----------------------------------------------------------------------------
3 SEC USE ONLY
- ----------------------------------------------------------------------------
4 SOURCE OF FUNDS* WC & BK
- ----------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)___
- -----------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION Georgia
- -----------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER 21,863,174
SHARES -----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER -0-
OWNED BY EACH -----------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER 21,863,174
PERSON WITH -----------------------------------------------------
10 SHARED DISPOSITIVE POWER -0-
- -----------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

*SEE INSTRUCTIONS BEFORE FILLING OUT!

<PAGE>

CUSIP No. [none] SCHEDULE 13D Page 5 of 24 Pages

Item 1. Security and Issuer.

This Statement on Schedule 13D (the "Schedule 13D") relates to ordinary
shares (the "Shares"), of OzEmail Limited, a corporation incorporated under the
laws of New South Wales, Australia (the "Company"). The principal executive
offices of the Company are located at Ground Floor, Building B, 39 Herbert
Street, St. Leonards, New South Wales, Australia.

Item 2. Identity and Background.

(a)-(d) The names and business addresses of the persons filing this
statement are

UUNET Holdings Australia Pty Limited (ACN 085 531 684) ("Purchaser")
44 Martin Place, Sydney, New South Wales, Australia

UUNET Technologies, Inc. (54-1543611) ("Intermediate") 3060 Williams
Drive, Fairfax, VA 22031, U.S.A.

MCI WORLDCOM, Inc. (58-1521612) ("Parent") 515 East Amite Street,
Jackson, MS 39201, U.S.A.

The Purchaser is a wholly owned subsidiary of Intermediate, which is a
wholly owned subsidiary of the Parent. The Parent is a holding company which,
through its subsidiaries, is a global provider of telecommunications services.
The Parent provides telecommunications services to business, governments,
telecommunications companies and other consumer customers through its network of
fiber optic cables, digital microwave, and fixed and transportable satellite
earth stations. The Parent was one of the first major facilities-based
telecommunications companies with the capability to provide businesses with high
quality local, long distance, Internet, data and international communications
services over its global networks.

Information relating to the directors and executive officers of the Parent,
the Purchaser and Intermediate (the "Reporting Persons") is contained in
Appendix A attached hereto and incorporated herein by reference.

(e) and (f) Neither any Reporting Person nor, to the best knowledge of the
Reporting Persons, any of the persons listed in Appendix A has, during the last
five years, (i) been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or (ii) been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction which has
resulted in a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities laws
or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

The funds required by the Purchaser to purchase the 21,863,174 ordinary
shares acquired by it as reflected in this Schedule 13D was US$43,726,348. Such
funds were obtained as an advance from the Parent.

The Parent obtained such funds from its cash on hand and from borrowings
under its credit facilities. These credit facilities were not established
specifically to fund the acquisition of the shares. These facilities comprise
US$10.75 billion in credit facilities consisting of US$3.75 billion Amended and
Restated Facility A Revolving Credit Agreement (the "Facility A Loans") and a
US$7 billion 364-Day Revolving Credit Agreement and Term Loan Agreement (the
"Facility C Loans") (together, the "Credit Facilities"). There are no unusual or
material conditions to be satisfied prior to drawdown under the Credit
Facilities. The parties to the Credit Facilities are the Parent and NationsBank,
N.A. (Arranging Agent and Administrative Agent), NationsBanc Montgomery
Securities LLC (Lead Arranger), Bank of America NT & SA, Barclays Bank PLC, The
Chase Manhattan Bank, Citibank, N.A., Morgan Guaranty Trust Company of New York,
and Royal Bank of Canada

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 6 of 24 Pages

(Co-Syndication Agents) and the lenders named in the Restated Facility A
Revolving Credit Agreement dated as of August 6, 1998 and the 364-Day Revolving
Credit and Term Loan Agreement dated August 6, 1998. The Credit Facilities
provide liquidity support for the Parent's commercial paper program and are used
for other general corporate purposes. The Facility A Loans mature on June 30,
2002. The Facility C Loans have a 364-day term, which may be extended for up to
two successive 364-day terms thereafter to the extent of the committed amounts
from those lenders consenting thereto, with a requirement that lenders holding
at least 51% of the committed amounts consent. Additionally, effective as of the
end of such 364-day term, the Parent may elect to convert up to US$4 billion of
the principal debt outstanding under the Facility C Loans from revolving loans
to term loans with a maturity date no later than one year after the conversion.

The Credit Facilities bear interest payable in varying periods, depending
on the interest period, not to exceed six months, or, with respect to any
Eurodollar Rate borrowing, 12 months if available to all lenders, at rates
selected by the Parent under the terms of the Credit Facilities, including a
Base Rate or Eurodollar Rate, plus the applicable margin. The applicable margin
for the Eurodollar Rate borrowing varies from 0.35% to 0.75% as to Facility A
Loans and from 0.225% to 0.450% as to Facility C Loans, in each case based upon
the better of certain debt ratings. The Credit Facilities are unsecured but
include a negative pledge of the assets of the Parent and its subsidiaries
(subject to certain exceptions). The Credit Facilities require compliance with a
financial covenant based on the ratio of total debt to total capitalization,
calculated on a consolidated basis. The Credit Facilities require compliance
with certain operating covenants which limit, among other things, the incurrence
of additional indebtedness by the Parent and its subsidiaries, sales of assets
and mergers and dissolutions, which covenants are generally less restrictive
than those contained in the prior credit facilities and which do not restrict
distributions to shareholders, provided the Parent is not in default under the
Credit Facilities. The Facility A Loans and the Facility C Loans are subject to
annual commitment fees not to exceed 0.25% and 0.12%, respectively, of any
unborrowed portion of the facilities.

This description of the Credit Facilities is a summary only and is not
intended to be a complete description of the all of the terms thereof. Reference
is made to the full text thereof, copies of which are filed as exhibits hereto
and incorporated by reference herein.

The consideration for the acquisition of the Shares and for the ADSs to
which the Offer referred to in Item 4 below relates will be satisfied wholly by
payment of cash. None of the funds for the consideration will be sourced from
the Purchaser's own resources.

The Parent has agreed to make available, or procure the availability, to
the Purchaser the amount required to fund the acquisition. There are no
conditions precedent to the Parent's obligation to make available, or procure
the availability, to the Purchaser the amount required to fund the acquisition,
except that the Purchaser cannot issue a drawdown notice unless and until the
Offer is declared or becomes free of conditions..

The amounts available under the Credit Facilities will exceed the maximum
amount payable under the Offer. The Parent has undertaken to the Purchaser that
the funds available to it under the Credit Facilities and which it will make
available to the Purchaser, will be sufficient to satisfy that maximum amount.
Because the Offer is made in US dollars, there is no need to engage in, and
neither the Purchaser nor the Parent has engaged in, hedging activities to
account for exchange rate fluctuations in connection with the Offer.

The Parent currently plans to repay borrowings under the Credit Facilities
out of operating cash flow and future financings, although the Parent has no
current specific plan with respect thereto. Such decisions when made will be
based on the Parent's review from time to time of the advisability of particular
actions, as well as on prevailing interest rates and financial and other
economic conditions.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 7 of 24 Pages

Item 4. Purpose of Transaction.

On December 13, 1998, the Parent announced that, through the Purchaser, it
acquired 21,863,174 newly issued ordinary shares of the Company and announced
that it will make a cash offer for all of the issued ordinary shares (the
"Shares") of the Company (including American Depository Shares ("ADSs") (and
together with the Shares, the "Securities")).

The Purchaser, a wholly owned subsidiary of the Parent, will make an
all-cash offer subject to conditions to be specified (the "Offer") to acquire
all of the issued ordinary shares of the Company at a price of US$2.20 per
share, including ADSs at a price of US$22.00 per ADS. As of December 18, 1998,
the Company had 146,732,714 ordinary shares issued and outstanding after this
issuance to the Purchaser, representing a total value for the Company's ordinary
issued and outstanding shares of approximately US$322.8 million, based on the
Parent's announced offer price.

The Parent acquired the relevant interest in 21,863,174 ordinary shares by
way of a Subscription Agreement with the Company at US$2.00 per share. The
Subscription Agreement gave the Parent a relevant interest in approximately 14.9
percent of the Company's expanded issued and outstanding ordinary shares. See
Item 6 below for a description of the Subscription Agreement. Subject to
completion of the transactions contemplated by the Offer, the Company would
become the Australian Internet service provider operating company for the Parent
group.

The Offer will be conditional upon, among other things:

(a) the Purchaser being entitled to proceed, under the Australian
Corporations Law (the "Corporations Law"), to compulsory acquisition of all
of the Company's shares at the expiration of the Offer;

(b) all Australian and other necessary governmental and regulatory
approvals being received including approval by the Foreign Investment
Review Board in Australia; and

(c) no prescribed occurrences (as defined in the Corporations Law)
(including, for example, the grant of options, liquidation or asset
disposition) occurring in relation to the Company or any of its
subsidiaries during the Offer period.

The Offer will remain open, unless extended, for at least one month from
the date of the Offer, which is expected to be in early January, 1999. Pending
commencement of the Offer, a copy of any offering documents filed with the
Australian Securities and Investments Commission (the "ASIC") will also be filed
by the Parent with the United States Securities and Exchange Commission (the
"SEC") as an exhibit to a Current Report on Form 8-K, as soon as practicable
after their registration with the ASIC.

Intention to Compulsorily Acquire. It is the Purchaser's present intention
that if, following the close of the Offer the Purchaser becomes entitled to
compulsorily acquire the Shares (including Shares represented by ADSs) which
were subject to the Offer but which were not acquired under the Offer, the
Purchaser will proceed to compulsorily acquire those Shares. In essence,
compulsory acquisition allows the Purchaser to compel any remaining holders of
Shares (including Shares represented by ADSs) to sell those Shares to the
Purchaser in the manner set forth below. The Offer will be conditional upon,
among other things, the Purchaser being entitled at the expiration date of the
Offer to not less than 90% of all Shares (including Shares represented by ADSs)
and either:

(a) three-quarters of the offerees have at the expiration date of the
Offer disposed of to the Purchaser (whether by way of accepting the Offer
or otherwise) the Shares or ADSs subject to acquisition that were held by
them; or

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 8 of 24 Pages

(b) at least three-quarters of the persons who were registered as the
holders of Shares or ADSs immediately before the day on which the Part A
Statement was served on the Company are not so registered at the end of one
month after the Offer expires (the "Minimum Condition").

If the Purchaser Becomes Entitled to Compulsory Acquisition. If the
Purchaser becomes entitled to compulsorily acquire Shares (including Shares
represented by ADSs), the Purchaser may, before the end of two months after the
end of the Offer period, give notice to an offeree who did not accept the Offer
to the effect that the Purchaser desires to acquire the outstanding Shares held
by that offeree. The Purchaser is then entitled and bound to acquire the Shares
to which the notice relates on the terms in effect at the end of the offer
period, unless a court orders otherwise. Provided that the court does not order
otherwise, the Purchaser must, within the prescribed period under the
Corporations Law, acquire the Shares by servicing a copy of a compulsory
acquisition notice on the Company, together with a transfer of the Shares signed
on behalf of the holder by a person appointed by the Purchaser. The Purchaser
also must pay the consideration for the transfer of the Shares to the Company,
to be held by the Company on trust for such offerees.

Additionally, the Purchaser will be seeking relief from the ASIC after the
close of the Offer period pursuant to the ASIC's Policy Statement 126 to permit
compulsory acquisition of Shares that may be issued after the close of the Offer
period, including at a later date of Shares issued following exercise by
employees of outstanding options to acquire Shares (the "Options"), assuming the
conditions necessary for compulsory acquisition are satisfied under the Offer.
The Purchaser will also apply to the ASIC for a modification of section
710(2)(c) of the Corporations Law so as to discount untraceable shareholders in
determining whether the compulsory acquisition requirements of section 701(2)(c)
have been satisfied by the Purchaser.

If the Purchaser does not Become Entitled to Compulsory Acquisition. If the
Purchaser is not entitled to compulsorily acquire any outstanding Shares within
two months of the expiration of the Offer, it will thereafter only be able to
compulsorily acquire those Shares pursuant to statutory procedure which
authorizes compulsory acquisition, such as a further takeover bid or a scheme of
arrangement. A scheme of arrangement between the Company and its shareholders
propounded by the Purchaser will bind shareholders and permit compulsory
acquisition or cancellation of the Shares held by a person other than the
Purchaser, if it is approved by shareholders (other than the Purchaser) who are
more than 50% in number of shareholders present and voting at a meeting held to
approve the scheme, being shareholders holding at least 75% of the shares held
by all shareholders present and voting at that meeting and if it is approved by
the court.

Intentions if the Purchaser Acquires 100% of Shares. If under the
Offer and the operation of the compulsory acquisition provisions of the
Corporations Law, the Purchaser obtains ownership of all the issued Shares
(including those Shares represented by ADSs), the Purchaser presently intends to
do the following:

(a) The Purchaser will in the ordinary course of its management,
review the lines of business, assets and employees of the Company to
evaluate performance, profitability, prospects and overall fit in the
Parent's Internet-related businesses in the light of the information that
is available to it. Given the Parent's plans to enter the facilities-based
telecommunications business in Australia, the Parent, together with the
Company, will be able to provide comprehensive and competitive
telecommunications services in Australia. This operational review will
focus on identifying opportunities to improve productivity and
competitiveness consistent with this plan.

(b) Subject to the operational review referred to in paragraph (a),
the Purchaser presently intends to:

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 9 of 24 Pages

(i) preserve and grow the existing core Internet services
provider business activities of the Company and integrate them into
the Parent's Internet-related businesses;

(ii) have the Company be the Internet service provider operating
company in Australia for the Parent group;

(iii) remove all of the Board of Directors of the Company and
seek the appointment of nominees of the Purchaser, some of whom may
include existing Company directors (although no arrangement, or
understanding exists in relation to this possible appointment);

(iv) perform a review of all existing telecommunications capacity
requirements of the Company and to the extent practicable and in
accordance with the Company's existing contractual arrangements
migrate those requirements to facilities owned or leased by the
Parent;

(v) achieve synergies by the elimination of any duplicate
functions arising as a result of the acquisition of the Company;

(vi) combine the Parent group's and the Company's technical,
managerial and sales skills and resources for the benefit of their
combined businesses;

(vii) review the capital funding requirements of the Company with
a view to utilizing the larger balance sheet of the Parent group and
seeking more favorable financing terms which the Purchaser expects
would be available to the Company;

(viii) have the Company removed from official listing on the
Australian Stock Exchange (the "ASX") and The Nasdaq National Market
(the "NNM");

(ix) terminate the registration of the Shares and/or ADSs, as
applicable, under the Securities Exchange Act of 1934 (the "Exchange
Act"); and

(x) as part of the operational review referred to in paragraph
(a), review the contractual and regulatory framework within which the
combined Company/Parent group would operate in Australia and New
Zealand.

(c) If the steps referred to in paragraph (b) are implemented, some
employees of the Company may be redundant. If suitable alternative
employment within the Parent group is not available and the Company's
employees are made redundant, they will receive their statutory and
contractual entitlements.

Apart from the matters listed above, the Purchaser does not presently
intend to make any other changes to the Company, the Company's business
(including redeployment of fixed assets) or the Company's employees.

Intentions if the Purchaser Acquires Less than 100% of Shares. If, prior to
the close of the Offer the Purchaser has waived the Minimum Condition and if, at
the close of the Offer, the Purchaser is entitled to more than 50 per cent but
less than 90 per cent of the issued Shares (including those Shares represented
by ADSs), the Purchaser presently intends to do the following, subject to the
Company's constitution and applicable laws and regulations:

1. conduct a review of the kind detailed in clause (a) above;

2. subject to that review, attempt to procure that the Board of Directors
of the Company:

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 10 of 24 Pages

(a) seeks the appointment of nominees of the Purchaser to the Board
of Directors of the Company in such a proportion as at least
equates to the Purchaser's shareholding interest in the Company;

(b) continues to operate the businesses of the Company and not make
any major changes to the businesses of the Company or make any
redeployment of the fixed assets of the Company; and

(c) coordinate the Parent group's and the Company's technical and
managerial and sales skills and resources for the benefit of
their combined businesses, with the provision of such resources
by one to the other being on arm's length terms;

3. if the steps referred to in paragraph (b) are implemented, some
employees of the Company may be redundant. However, it is likely that
there will be fewer redundancies than if the Company becomes a
wholly-owned subsidiary of the Purchaser since it will not be possible
to eliminate to the same extent duplicate functions in relation to,
for example, certain public company reporting functions; and

4. have the Company removed from the official listing on the ASX and the
NNM when and to the extent permitted by the ASX and NNM and, when and
to the extent permitted by the Exchange Act, to seek to terminate the
registration of the Shares and/or ADSs, if applicable, under the
Exchange Act.

Apart from the matters listed above, the Purchaser does not presently
intend to make other changes to the Company, the Company's business (including
redeployment of fixed assets) or the Company employees.

If, at the close of the Offer, the Purchaser is entitled to less than 50
per cent of the issued Shares (including those Shares represented by ADSs), then
the Purchaser will consider the options available to it as a holder of less than
50 per cent.

The intentions of the Purchaser referred to above have been formed with
reference to publicly available information and without the benefit of any
detailed review of the Company's businesses. In particular, the Purchaser has
not had access to all of the instruments and agreements under which the Company
has financed its operations or engaged in business ventures with other parties.
For example, the Purchaser has not had access to all the terms of the Company's
contracts.

Following the implementation of the operational review described above, it
will be a matter for the Board of Directors of the Company to determine the
extent to which the steps referred to above are to be implemented (if at all).
Final decisions will only be reached after the review referred to above, and
will only be reached in the light of all material facts and circumstances which
then exist. Accordingly, the statements contained in this Item 4 are statements
of current intention only which may vary as circumstances require depending,
among other matters, on the outcome of the Offer. The Board of Directors of the
Company may only implement the steps in accordance with all applicable, legal,
regulatory, contractual, SEC, ASIC, ASX and NNM requirements and their
fiduciary, statutory and contractual obligations generally.

Except as indicated elsewhere herein, neither the Parent, nor Intermediate
nor the Purchaser has any present plans or proposals which relate to, or would
result in, an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its subsidiaries,
a sale or transfer of a material amount of assets of the Company or any of its
subsidiaries, any material change in the Company's capitalization or dividend
policy, or any other material change in the Company's corporate structure or
business, or the composition of the board or management.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 11 of 24 Pages

"Going Private" Transactions. The SEC has adopted Rule 13e-3 under the
Exchange Act which is applicable to certain "going-private" transactions and
which may be applicable as a consequence of the Offer. Rule 13e-3 may apply if
the Purchaser acquires less than 90% of the outstanding Securities in the Offer
(and consequently is unable to compulsorily acquire all of the Securities in
accordance with the Corporations Law), and the Purchaser subsequently enters
into certain business combinations with the Company or makes certain
acquisitions of Securities. Rule 13e-3 would be inapplicable if the Shares
and/or ADSs, as applicable, were deregistered under the Exchange Act prior to
any such business combination or acquisition of Securities. If applicable, Rule
13e-3 would require, among other things, that certain financial information
concerning the Company and certain information relating to the fairness of the
consideration offered to minority shareholders be filed with the SEC and
distributed to minority shareholders before the consummation of any such
transaction.

The purchase of a substantial number of Securities pursuant to the Offer
may result in the termination, upon application of the Company to the SEC, of
the Company's registration of its Securities under the Exchange Act, as
described below. If such registration were terminated, Rule 13e-3 would be
inapplicable to any such business combination or acquisition of Securities.

Effect on the Market for the Securities; NNM and ASX Quotation and Exchange
Act Registration. The purchase of Securities pursuant to the Offer will reduce
the number of Securities that might otherwise trade publicly and could reduce
the number of holders of Securities, which could adversely affect the liquidity
and market value of the remaining Securities held by the public.

Depending upon the number of ADSs purchased pursuant to the Offer, the ADSs
may no longer meet the requirements of the National Association of Securities
Dealers, Inc. (the "NASD") for continued inclusion on the NNM. According to the
NASD's published guidelines, the ADSs would not be eligible to be included for
listing if, among other things, (i) the number of round lot holders of ADSs
(holders of 100 or more ADSs)falls below 400, (ii) the aggregate market value of
such publicly held ADSs does not exceed $5,000,000 or (iii) there are not at
least two registered and active market makers for the ADSs, each of which must
enter a firm two-sided quotation. According to the Company's Annual Report on
Form 10-K for the year ending December 31, 1997, there were 121,226,250 Shares
outstanding, 33,820,000 of which were represented by ADSs held by 38 holders of
record. According to the Company's Report on Form 6-K for the quarter ending
September 30, 1998, as of September 30, 1998, there were 124,819,500 Shares
issued and outstanding, of which the Company advised the Purchaser approximately
40,552,210 were represented by ADSs. The Company has advised the Purchaser that
as of December 21, 1998 the Company had 146,732,714 ordinary shares issued and
outstanding, of which approximately 42,855,100 were represented by ADSs.

The Shares are listed on the ASX. According to the ASX rules, to maintain a
listing, a sufficient spread of shareholders is required, which is generally
interpreted by ASX to mean 300 holders of marketable parcels (which term is
defined in the ASX Listing Rules and is dependent on the value of the securities
and in the case of the Company would mean 50 Shares). If that threshold is not
met, the ASX may request the Company to take steps to increase the number of
holders of marketable parcels and could eventually seek to have the Company
apply for the delisting of the Shares.

In circumstances where the Purchaser has acquired Shares pursuant to the
Offer, but is not in a position to compulsorily acquire any Shares not then held
by the Purchaser, the Purchaser considers that delisting of the Shares on the
ASX is unlikely. Accordingly, the Purchaser's present intention is only to seek
to have the Shares delisted from the ASX in circumstances where the Purchaser
acquires 100% of the Shares. However, in

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 12 of 24 Pages

circumstances where the Purchaser has acquired Securities pursuant to the Offer
and is in a position to compulsorily acquire the Shares not then held by the
Purchaser, the Purchaser intends to proceed to compulsorily acquire those Shares
and, as a result, delisting of the Shares would occur.

Although the Purchaser considers that delisting of the Shares and ADSs by
the ASX and the NNM respectively, is unlikely in circumstances where the
Purchaser is not in a position to compulsorily acquire any shares not then held
by the Purchaser, the following information may be relevant to investors should
the NNM and the ASX delist the ADSs and Shares, respectively:

(a) If the NNM and the ASX were to delist the ADSs and the Shares
respectively, the market therefor could be adversely affected. It is
possible that the ADSs and the Shares would be traded on other securities
exchanges or in the over-the-counter market, and that the price quotations
would be reported by such exchanges or through other sources. For example,
the ADSs may nevertheless continue to be included in The Nasdaq SmallCap
Market unless, among other things, there were fewer than 300 round lot
holders in total. If the ADSs are no longer eligible for inclusion in the
NNM or The Nasdaq SmallCap Market, the ADSs might still be quoted on the
OTC Bulletin Board. The extent of the public market for such and the
availability of such quotations would depend, however, upon such factors as
the number of holders and/or the aggregate market value of such securities
remaining at such time, the interest in maintaining a market in the
Securities on the part of securities firms, the possible termination of
registration under the Exchange Act as described below and other factors.
The Purchaser cannot predict whether the reduction in the number of
Securities that might otherwise trade publicly would have an adverse or
beneficial effect on the market price for, or marketability of, Securities
or whether it would cause future market prices to be greater or lesser than
the Offer price.

(b) The ADSs are currently "margin securities" under the regulations
of the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board"), which has the effect, among other things, of allowing
brokers to extend credit on the collateral of the ADSs. Depending upon
factors similar to those described above regarding listing and market
quotations, following the Offer, it is possible that the ADSs might no
longer constitute "margin securities" for purposes of the margin
regulations of the Federal Reserve Board, in which event such ADSs could no
longer be used as collateral for loans made by brokers.

(c) The Shares and/or ADSs, as applicable, are currently registered
under the Exchange Act. Such registration may be terminated upon
application by the Company to the SEC under certain circumstances if the
Shares and/or ADSs, as applicable, are not listed on a national securities
exchange and there are fewer than 300 record holders of the ADSs. The
termination of registration of the Shares and/or ADSs, as applicable, under
the Exchange Act would substantially reduce the information required to be
furnished by the Company to holders of Shares and ADSs and to the SEC and
would make certain provisions of the Exchange Act, such as the requirements
of Rule 13e-3 under the Exchange Act with respect to "going private"
transactions, no longer applicable to the Company. See "Going Private
Transactions" above. In addition, "affiliates" of the Company and persons
holding "restricted securities" of the Company may be deprived of the
ability to dispose of such securities pursuant to Rule 144 promulgated
under the Securities Act. If registration of the Shares and/or ADSs, as
applicable, under the Exchange Act were terminated, the Shares and ADSs
would no longer be "margin securities" or be eligible for NNM reporting.

(d) If the Company is no longer listed on the ASX, the reporting and
filing requirements of the ASX will no longer need to be complied with. The
Company will, however, continue to be subject to requirements relating to

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 13 of 24 Pages

continuous disclosure of all material information that a reasonable person
would expect to have a material effect on the price or value of the
Securities under the continuous disclosure requirements of the Corporations
Law, as long as the Company continues to have 100 or more holders of its
Shares and is therefore a disclosing entity under the Corporations Law. The
Company will also continue to be subject to other provisions of the
Corporations Law, such as provisions governing related party transactions
and takeovers, until such time (if any) as the Company becomes a
wholly-owned subsidiary of the Purchaser pursuant to the compulsory
acquisition provisions of the Corporations Law or otherwise.

Item 5. Interest in Securities of the Issuer.

(a) The Reporting Persons are the beneficial owners of 21,863,174 Shares,
or approximately 14.9% of the Shares outstanding, based on 146,732,714 Shares
outstanding after the placement to the Purchaser as reported by the Company to
the Purchaser.

(b) The Reporting Persons have sole voting and dispositive power with
respect to the 21,863,174 Shares beneficially owned by
them.

(c) See Item 6 regarding the placement of Shares to Purchaser pursuant to
the Subscription Agreement. The Reporting Persons have not effected any
purchases of ADSs or Shares during the past 60 days except as described therein.
To the best knowledge of the Reporting Persons, none of the persons listed on
Appendix A has effected any transactions in the Securities during the past 60
days.

(d) Not applicable.

(e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.

The Reporting Persons do not have any contract, arrangement, understanding,
or relationship (legal or otherwise) with any person with respect to any
securities of the Company other than as indicated below and elsewhere herein.

Subscription Agreement. The following is a summary of certain provisions of
the Subscription Agreement, a copy of which is filed as an Exhibit to this
Schedule 13D and is incorporated herein by reference. This summary is qualified
in its entirety by reference to the Subscription Agreement.

Subscription and Issuance of Shares. Pursuant to the Subscription
Agreement, the Purchaser acquired 21,863,174 ordinary shares in the capital of
the Company representing in aggregate no more than 14.9% of the ordinary share
capital of the Company, after issuance of the shares, at the subscription price
of US$43,726,348 (the "Subscription Price"), representing US$2.00 per share on
the subscription date of December 12, 1998 (Sydney, Australia time) (the
"Subscription Date").

Registration Rights. The Subscription Agreement provided that the Purchaser
understood that the acquired shares were not registered under the U.S.
Securities Act of 1933 (the "Securities Act") and agreed that it will only offer
and sell such shares pursuant to a registration statement in accordance with the
Securities Act, pursuant to an exemption from the registration requirements of
the Securities Act, or in a transaction not subject to the Securities Act. The
Subscription Agreement provided that in the event that the Purchaser makes a
takeover bid that is subsequently terminated or is otherwise not entitled to
proceed under the Corporations Law to compulsory acquisition of all the ordinary
shares of the Company, the Company agreed, upon the request of the Purchaser, to
file one registration statement under the Securities Act and applicable
Australian laws relating to the sale of the Shares and any other shares acquired
pursuant to the Offer and to use its best efforts to cause the registration

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 14 of 24 Pages

statement to become effective. The Company will not be required to file the
registration statement, however, if, in a written opinion of the Company's
counsel satisfactory to the Purchaser, such registration is not required for the
sale of the shares in the manner proposed by the Purchaser. If a registration
statement is filed, the Company agrees to use its best efforts to maintain the
effectiveness of such registration statement, including any amendment,
supplement or updates necessary, until the completion of the distribution or
such time as the registration is no longer necessary. The registration would be
made at the Company's expense except for underwriting commissions and fees and
disbursements of the Purchaser's counsel. The Company and the Purchaser agreed
to indemnify and hold harmless each other and their controlling persons, and to
make contribution, to the same extent as is customary in a U.S. registration
rights agreement between an issuer and a minority stockholder. The Purchaser's
registration rights may be assigned to any transferee who acquires the shares or
any other shares of the Company acquired by the Purchaser pursuant to the Offer.

Members Register. Pursuant to the Subscription Agreement, the Company must
provide a hard copy and a copy on computer disk or computer tape, if applicable,
of the information on the register of members of the Company as at the date
stated by the Purchaser, within two business days of written request.

Warranties. The Subscription Agreement contains various warranties of the
Company relating to the following: (i) the percentage of the capital of the
Company represented by the Shares; (ii) options and other rights to acquire
shares; (iii) a three month period following the date of the Subscription
Agreement during which the Company will not issue and allot any shares other
than those pursuant to existing rights under any employee share option plan;
(iv) the Company's power and authority to perform its obligations under the
Subscription Agreement; (v) the approval of the issue of the Shares by the
Company's shareholders and the absence of breach of the Listing Rules of the ASX
or the Company's constitution; and (vi) the absence of any proceeding concerning
the winding up, receivership or liquidation of the Company.

Other Provisions. The Subscription Agreement provided for the termination
of the confidentiality agreement between Goldman Sachs Australia LLC (on behalf
of the Company) and the Purchaser, subject to certain conditions. The
Subscription Agreement provided that the Company must apply to the ASX for
quotation of the Shares within two business days of the Subscription Date, and
use its best effort to ensure the Shares are quoted by the ASX as soon as
possible after the Subscription Date.

Announcement of Offer. The parties agreed to issue separate press releases,
which are attached as exhibits to the Subscription Agreement filed herewith,
announcing the completion of the subscription by the Purchaser and the
Purchaser's intent to make the Offer.

Governing Law. The Subscription Agreement is governed by the laws
applicable in New South Wales, Australia. Each party submits to non-exclusive
jurisdiction in the courts of New South Wales, Australia.

Item 7. Material To Be Filed As Exhibits.

(a) Subscription Agreement, dated December 11, 1998, by and between the
Purchaser and the Company.

(b) Amended and Restated Facility A Revolving Credit Agreement, dated
as of August 6, 1998, among the Parent (borrower), NationsBank, N.A. (Arranging
Agent and Administrative Agent), NationsBanc Montgomery Securities LLC (Lead
Arranger), Bank of America NT & SA, Barclays Bank PLC, The Chase Manhattan Bank,
Citibank, N.A., Morgan Guaranty Trust Company of New York, and Royal Bank of
Canada (Co-Syndication Agents) and the lenders named therein dated as of August
6, 1998 (incorporated herein by reference to Exhibit 10.1 to the Parent's

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 15 of 24 Pages

Current Report on Form 8-K dated August 6, 1998 (filed August 7, 1998) (File No.
0-11258))

(c) 364-day Revolving Credit and Term Loan Agreement, dated as of
August 6, 1998, among the Parent (borrower), NationsBank, N.A. (Arranging Agent
and Administrative Agent), NationsBanc Montgomery Securities LLC (Lead
Arranger), Bank of America NT & SA, Barclays Bank PLC, The Chase Manhattan Bank,
Citibank, N.A., Morgan Guaranty Trust Company of New York, and Royal Bank of
Canada (Co-Syndication Agents) and the lenders named therein dated August 6,
1998 (incorporated herein by reference to Exhibit 10.3 to the Parent's Current
Report on Form 8-K dated August 6, 1998 (filed August 7, 1998) (File No.
0-11258))

(d) Powers of Attorney of the Purchaser, Intermediate and the Parent
(contained on Signature and Power of Attorney pages)

The undersigned hereby agree to jointly file a statement on Schedule 13D,
together with any amendments thereto, with the SEC pursuant to the requirements
of Rule 13d-1(f) under the Securities Exchange Act of 1934, as amended.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 16 of 24 Pages

SIGNATURE AND POWER OF ATTORNEY

After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.

UUNET Holdings Australia Pty Limited (the "Purchaser") hereby constitutes
and appoints John W. Sidgmore, Scott D. Sullivan and Charles T. Cannada, and
each of them (with full power to each of them to act alone), the true and lawful
attorney-in-fact and agent for Purchaser, to act on behalf of and in the name of
Purchaser in connection with this Schedule 13D, including the authority to sign
any amendments hereto, and to file the same, with exhibits and any and all other
documents filed with respect thereto, with the Securities and Exchange
Commission (or any other governmental or regulatory authority), and Purchaser
ratifies and confirms all that said attorneys in fact and agents may lawfully do
or cause to be done by virtue hereof.

Dated: December 21, 1998

UUNET Holdings Australia Pty Limited

By: /s/ CHARLES T. CANNADA
----------------------------------
Name: Charles T. Cannada
Title: Director

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 17 of 24 Pages

SIGNATURE AND POWER OF ATTORNEY

After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.

UUNET Technologies, Inc. (the "Intermediate") hereby constitutes and
appoints John W. Sidgmore, Scott D. Sullivan and Charles T. Cannada, and each of
them (with full power to each of them to act alone), the true and lawful
attorney-in-fact and agent for Intermediate, to act on behalf of and in the name
of Intermediate in connection with this Schedule 13D, including the authority to
sign any amendments hereto, and to file the same, with exhibits and any and all
other documents filed with respect thereto, with the Securities and Exchange
Commission (or any other governmental or regulatory authority), and Intermediate
ratifies and confirms all that said attorneys in fact and agents may lawfully do
or cause to be done by virtue hereof.

Dated: December 21, 1998

UUNET Technologies, Inc.

By: /s/ MARK F. SPAGNOLO
---------------------------------------
Name: Mark F. Spagnolo
Title: President and Chief Executive Officer

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 18 of 24 Pages

SIGNATURE AND POWER OF ATTORNEY

After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.

MCI WORLDCOM, Inc. (the "Parent") hereby constitutes and appoints John W.
Sidgmore, Scott D. Sullivan and Charles T. Cannada, and each of them (with full
power to each of them to act alone), the true and lawful attorney-in-fact and
agent for Parent, to act on behalf of and in the name of Parent in connection
with this Schedule 13D, including the authority to sign any amendments hereto,
and to file the same, with exhibits and any and all other documents filed with
respect thereto, with the Securities and Exchange Commission (or any other
governmental or regulatory authority), and Parent ratifies and confirms all that
said attorneys in fact and agents may lawfully do or cause to be done by virtue
hereof.

Dated: December 21, 1998

MCI WORLDCOM, Inc.

By: /s/ SCOTT D. SULLIVAN
--------------------------------------
Name: Scott D. Sullivan
Title: Chief Financial Officer and Secretary

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 19 of 24 Pages

Appendix A

INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE
OFFICERS OF THE PARENT, INTERMEDIATE AND THE PURCHASER

1. Directors and Executive Officers of the Parent. Set forth below are the
name, current business address, citizenship and the present principal occupation
or employment and material occupations, positions, offices or employments for
the past five years of each director and executive officer of the Parent. The
principal address of the Parent and, unless otherwise indicated below, the
current business address for each individual listed below is 515 East Amite
Street, Jackson, Mississippi 39201-2702, U.S.A. Unless otherwise indicated, each
such person is a citizen of the United States. Unless otherwise indicated, each
occupation set forth opposite the individual's name refers to employment with
the Parent.
<TABLE>

<CAPTION>
Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years
---------------- --------------------------------------------------

<S> <C>
CLIFFORD L. ALEXANDER, JR. Mr. Alexander has been a director of the Parent since its
Alexander & Associates, Inc. merger with MCI Communications Corporation ("MCI") in
400 C. Street, N.E. September 1998. He has been President of Alexander &
Washington, D.C. 20002 Associates, Inc., management consultants, since 1981. Mr.
U.S.A. Alexander is also a director of Dreyfus 3rd Century Fund,
Dreyfus General Family of Funds, Mutual of America Life
Insurance Company, Dun & Bradstreet Corporation, American
Home Products Corporation and IMS Health Incorporated.

JAMES C. ALLEN Mr. Allen has been a director of the Parent since March
3023 Club Drive 1998. Mr. Allen is the former Vice Chairman and Chief
Destin, FL 32541 Executive Officer and a former director of Brooks Fiber
U.S.A. Properties, Inc. ("BFP"), where he served in such capacities
from 1993 until February 1998. Mr. Allen served as President
and Chief Operating Officer of Brooks Telecommunications
Corporation, a founder of BFP, from April 1993 until it was
merged with BFP in January 1996. Mr. Allen serves as a
director of Metronet Communications Corp. and Verio Inc.

JUDITH AREEN Ms. Areen has been a director of the Parent since its merger
Georgetown University Law Center with MCI in September 1998. She has been Executive Vice
600 New Jersey Avenue, N.W. President for Law Center Affairs and Dean of the Law Center,
Washington, D.C. 20001 Georgetown University since 1989. She has been a Professor
U.S.A. of Law, Georgetown University, since 1976.

CARL J. AYCOCK Mr. Aycock has been a director of the Parent since 1983. Mr.
123 South Railroad Avenue Aycock served as Secretary of the Parent from 1987 to 1995
Brookhaven, MS 39601 and was the Secretary and Chief Financial Officer of Master
U.S.A. Corporation, a motel management and ownership company, from
1989 until 1992. Subsequent to 1992, Mr. Aycock has been
self employed as a financial administrator.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 20 of 24 Pages

MAX E. BOBBITT Mr. Bobbitt has been a director of the Parent since 1992.
62 Carmel Drive Mr. Bobbitt was a director of Advanced Telecommunications
Little Rock, AR 72112 Corporation ("ATC") until its merger with the Parent in
U.S.A. December 1992 (the "ATC Merger"). He is currently a
consultant and previously was President and Chief Executive
Officer of Metromedia China Corporation, a
telecommunications company, from 1997 until June 1998. From
1996 until February 1997, Mr. Bobbitt was President and
Chief Executive Officer of Asian American Telecommunications
Corporation. Prior to 1996, Mr. Bobbitt held various
positions including President and Chief Operating Officer
and director of ALLTEL Corporation, a telecommunications
company, from 1970 until January 1995.

STEPHEN M. CASE Mr. Case has been a director of the Parent since March 1998.
America Online, Inc. Mr. Case, a co-founder of America Online, Inc. ("AOL"), has
22000 AOL Way been Chairman of the Board of Directors of AOL since October
Dulles, VA 20166-9323 1995, Chief Executive Officer of AOL since April 1993 and a
U.S.A. director of AOL since September 1992. Mr. Case served as
President of AOL from July 1996 until February 1998 and from
January 1991 to February 1996. Previously, he served as
Executive Vice President of AOL from September 1987 to
January 1991 and Vice President, Marketing, from 1985 to
September 1987. Since June 1998, Mr. Case serves as a member
of the Board of Directors of the New York Stock Exchange.

BERNARD J. EBBERS Mr. Ebbers has been President and Chief Executive Officer of
the Parent since April 1985. Mr. Ebbers has served as a
director of the Parent since 1983.

FRANCESCO GALESI Mr. Galesi has been a director of the Parent since 1992.
The Galesi Group Mr. Galesi was a director of ATC until the ATC Merger.
435 East 52nd Street Mr. Galesi is the Chairman and Chief Executive Officer of
New York, NY 10022 the Galesi Group, which includes companies engaged in
U.S.A. distribution, manufacturing, real estate and
telecommunications. Mr. Galesi serves as a director of
Amnex, Inc. and Walden Residential Properties, Inc.

STILES A. KELLETT, JR. Mr. Kellett has served as a director of the Parent since
Kellett Investment Corporation 1981. Mr. Kellett has been Chairman of Kellett Investment
200 Galleria Parkway, Suite 1800 Corporation since 1995. From 1978 to 1995, Mr. Kellett served
Atlanta, GA 30339 as Chairman of the Board of Directors of Convalescent
U.S.A. Services, Inc., a long-term health care company in Atlanta,
Georgia. Mr. Kellett serves as a director of Frederica Bank
& Trust Company, St. Simons Island, Georgia.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 21 of 24 Pages

GORDON S. MACKLIN Mr. Macklin has been a director of the Parent since its
8212 Burning Tree Road merger with MCI in September 1998. Mr. Macklin is a director
Bethesda, MD 20817 of Martek Biosciences Corporation; Fund American Enterprises
U.S.A. Holdings, Inc.; MedImmune, Inc.; Real 3-D; Spacehab, Inc.;
and director, trustee or managing general partner, as the
case may be, of 49 of the investment companies in the
Franklin Templeton Group of Funds. Mr. Macklin was formerly
Chairman, White River Corporation, an information services
company, from 1993 until June 1998; Chairman, Hambrecht and
Quist Group; director, H&Q Healthcare Investors; director,
CCC Information Services Group, Inc.; and President,
National Association of Securities Dealers, Inc.

JOHN A. PORTER Mr. Porter has been a director of the Parent since 1988. Mr.
Integra Funding Porter served as Vice Chairman of the Board of the Parent
295 Bay Street, Suite 2 from September 1993 until the Parent's merger with MFS
Easton, MD 21601 Communications Company, Inc. ("MFS") in December 1996 (the
U.S.A. "MFS Merger") and served as Chairman of the Board of
Directors of the Parent from 1988 until September 1993. From
May 1995 to the present, Mr. Porter has served as Chairman
of the Board of Directors and Chief Executive Officer of
Industrial Electric Manufacturing, Inc., a manufacturer of
electrical power distribution products. Mr. Porter also
serves as Chairman of Phillips & Brooks/Gladwin, Inc., a
manufacturer of pay telephone enclosures and equipment.
Mr. Porter was previously President and sole shareholder of
P.M. Restaurant Group, Inc. which filed for protection under
Chapter 11 of the United States Bankruptcy Code in March
1995. Subsequent to March 1995, Mr. Porter sold all of his
shares in P.M. Restaurant Group, Inc. Mr. Porter is also a
director of Uniroyal Technology Corporation and XL Connect,
Inc.

TIMOTHY F. PRICE Mr. Price has been a director of the Parent since its merger
MCI WORLDCOM, Inc. with MCI in September 1998. He has served as President and
1801 Pennsylvania Avenue, N.W. Chief Executive Officer of the MCI WorldCom communications
Washington, D.C. 20006 unit of the Parent since the merger. Mr. Price was President
U.S.A. and Chief Operating Officer of MCI from November 1996 to
September 1998, when it merged with the Parent. He was
President and Chief Operating officer of MCI
Telecommunications Corporation ("MCIT") from July 1995 to
September 1998. He was an Executive Vice President and Group
President of MCIT, serving as Group President, Communication
Services, from December 1994 to July 1995. He was an
Executive Vice President of MCIT, serving as President,
Business Markets, from June 1993 to December 1994. He was a
Senior Vice President of MCIT from November 1990 to June
1993, serving as President, Business Services, from July
1992 to June 1993 and as Senior Vice President, Consumer
Markets, from November 1990 to July 1992.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 22 of 24 Pages

BERT C. ROBERTS, JR. Mr. Roberts has been a director and Chairman of the Board of
MCI WORLDCOM, Inc. the Parent since its merger with MCI in September 1998. He
1801 Pennsylvania Avenue, N.W. was Chairman of the Board of MCI from June 1992 to September
Washington, D.C. 20006 1998, when it merged with the Parent. He was Chief Executive
U.S.A. Officer of MCI from December 1991 to November 1996. He was
President and Chief Operating Officer of MCI from October
1985 to June 1992 and President of MCIT from May 1983 to
June 1992. Mr. Roberts was a director of MCI from 1985 to
September 1998 and a non-executive director of British
Telecommunications plc ("BT") from October 1994 to March
1998. He has been a non-executive director of The News
Corporation Limited, a global multi-media company located in
Australia, since 1995; a non-executive director of
Telefonica de Espana, S.A. since March 1998; and a
non-executive director of Valence Technology, Inc..

JOHN W. SIDGMORE Mr. Sidgmore serves as Vice Chairman of the Board of the
MCI WORLDCOM, Inc. Parent. Mr. Sidgmore has been a director of the Parent since
3060 Williams Drive the MFS Merger and has served as a director of MFS since
Fairfax, VA 22301 August 1996. Mr. Sidgmore was President and Chief Operating
U.S.A. Officer of MFS from August 1996 until the MFS Merger and has
been Chief Executive Officer and a director of Intermediate
from June 1994 to October 1998, and also held the position
of President of Intermediate from June 1994 to August 1996
and from January 1997 to September 1997. From 1989 to 1994,
he was President and Chief Executive Officer of CSC
Intelicom, a telecommunications software company. Mr.
Sidgmore is a director of Saville Systems PLC.

SCOTT D. SULLIVAN Mr. Sullivan serves as Chief Financial Officer, Treasurer
and Secretary of the Parent. From the ATC Merger until
December 1994, Mr. Sullivan served as Vice President and
Assistant Treasurer of the Parent. From 1989 until 1992, Mr.
Sullivan served as an executive officer of two long-distance
companies, including ATC. From 1983 to 1989, Mr. Sullivan
served in various capacities with KPMG Peat Marwick LLP.
Mr. Sullivan has served as a director of the Parent since
March 1996.

GERALD H. TAYLOR Mr. Taylor has been a director of the Parent since its
MCI WORLDCOM, Inc. merger with MCI in September 1998 and Chief Executive
1801 Pennsylvania Avenue, N.W. Officer of MCI from November 1996 to September 1998 and
Washington, D.C. 20006 Vice Chairman of MCIT from July 1995 to September 1998. He
U.S.A. was President and Chief Operating Officer of MCI from July
1994 to November 1996 and President and Chief Operating
Officer of MCIT from April 1994 to July 1995. He was an
Executive Vice President and Group Executive of MCIT from
September 1993 to April 1994. He was an Executive Vice
President of MCIT, serving as President, Consumer Markets,
from November 1990 to September 1993. Mr. Taylor was a
director of MCI from September 1994 to September 1998 and
was a non-executive director of BT from November 1996 to
November 1997.

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 23 of 24 Pages

LAWRENCE C. TUCKER Mr. Tucker is a general partner of Brown Brothers Harriman &
Brown Brothers Harriman & Co. Co., which is the general and managing partner of The 1818
59 Wall Street Funds. He is also a director of The WellCare Management
New York, NY 10005 Group, Inc., Riverwood International Corporation and
U.S.A. National HealthCare Corporation. He has served as a director
of the Parent since May 1995, and previously served as a
director of the Parent from May 28, 1992 until the ATC
Merger.

JUAN VILLALONGA Mr. Villalonga has served as the Chairman and Chief
(citizen of Spain) Executive Officer of Telefonica de Espana, S.A.
Telefonica de Espana, S.A. ("Telefonica"), a provider of telecommunications services in
Gran Via 28, 9th floor Spain, since 1996. He has been a director of the Parent
28013 Madrid since November 1998 pursuant to a Strategic Alliance
Spain Agreement among Telefonica, MCI and the Parent. Mr.
Villalonga was previously the CEO of Bankers Trust in Spain
and Portugal, the CEO of CS First Boston in Spain and a
partner at Kinsey & Co., a consulting firm, for nine years.

</TABLE>

2. Directors and Executive Officers of Intermediate. Set forth below are
the name, current business address, citizenship and the present principal
occupation or employment and material occupations, positions, offices or
employments for the past five years of each director and executive officer of
Intermediate. The principal address of Intermediate and, unless otherwise
indicated below, the current business address for each individual listed below
is 3060 Williams Drive, Fairfax, Virginia 22031, U.S.A. Unless otherwise
indicated, each such person is a citizen of the United States. Unless otherwise
indicated, each occupation set forth opposite the individual's name refers to
employment with Intermediate.
<TABLE>
<CAPTION>

Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years
---------------- --------------------------------------------------

<S> <C>
JOHN W. SIDGMORE Chairman (See Above)
MCI WORLDCOM, Inc.
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
U.S.A.

CHARLES T. CANNADA Director. Mr. Cannada serves as Senior Vice President,
MCI WORLDCOM, Inc. Corporate Development of the Parent. Prior to assuming this
515 East Amite Street position in January1995, Mr. Cannada served as Treasurer and
Jackson, MS 39201 Chief Financial Officer of the Parent. He joined the Parent
U.S.A. in 1989. He is also a director of Nova Corporation, since
May 1998, and of WAM|NET, Inc., since September 1998.
Director. (See Above)

SCOTT D. SULLIVAN Director (see above)
MCI WORLDCOM, Inc.
515 East Amite Street
Jackson, MS 39201
U.S.A

MARK F. SPAGNOLO Mr. Spagnolo is a director and has been President and Chief
MCI WORLDCOM, Inc. Executive Officer of Intermediate since October 1998. He was
1801 Pennsylvania Avenue, N.W. President and Chief Operating Officer from August 1997 until
Washington, D.C. 20006 October 1998. He was a division officer of Electronic Data
U.S.A. Systems from 1973 until August 1997, most recently as
Division President. From June 1995 to April 1996, he was a
director and the acting Chief Executive Officer of Video
Lottery Technologies. Mr. Hilber has served as Chief
Financial Officer of Intermediate since September 1993.

JEFFREY G. HILBER Mr. Hilber has served as Chief Financial Officer of
MCI WORLDCOM, Inc. Intermediate since September 1993.
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
U.S.A.

</TABLE>

<PAGE>
CUSIP No. [none] SCHEDULE 13D Page 24 of 24 Pages

3. Directors and Executive Officers of Purchaser. Set forth below is the
name, current business address, citizenship and the present occupation or
employment and material occupations, positions, offices or employments for the
past five years of each director and executive officer of the Purchaser. The
principal address of the Purchaser and, unless otherwise indicated below, the
current business address for each individual listed below is 44 Martin Place,
Sydney, New South Wales, Australia. Unless otherwise indicated, each such person
is a citizen of the United States. Unless otherwise indicated, each occupation
set forth opposite the individual's name refers to employment with the
Purchaser.
<TABLE>
<CAPTION>

Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years

<S> <C>
JOHN W. SIDGMORE Director since December 1998 (See Above)
MCI WORLDCOM, Inc.
3060 Williams Drive
Fairfax, VA 22031-4648
U.S.A

CHARLES T. CANNADA Director since December 1998 (See Above)
MCI WORLDCOM, Inc.
515 East Amite Street
Jackson, MS 39201
U.S.A.

Leigh Brown Director. Mr. Brown is a senior corporate and securities
(citizen of Australia) partner with the national Australian law firm of Minter
44 Martin Place Ellison. He is admitted to practice in New South Wales,
Sydney NSW 2000 Queensland, Victoria and the Australian Capital Territory.
Australia He has been a partner of Minter Ellison since 1979. He is a
member of the firm's Partnership Board.
</TABLE>

OZEMAIL LIMITED

UUNET HOLDINGS AUSTRALIA PTY LIMITED

SUBSCRIPTION AGREEMENT

MINTER ELLISON
Lawyers
Minter Ellison Building
44 Martin Place
SYDNEY NSW 2000
DX 117 SYDNEY
Telephone (02) 9210 4444
Facsimile (02) 235 2711
Ref: ECT:DLW:10733123

<PAGE>

TABLE OF CONTENTS

1. DEFINITIONS AND INTERPRETATION.................................1
1.1 Definitions..........................................1
1.2 Interpretation.......................................1

2. AGREEMENT TO SUBSCRIBE.........................................2
2.1 Agreement to subscribe and issue Shares..............2
2.2 Confidentiality......................................2

3. SUBSCRIPTION FOR THE SHARES....................................2
3.1 Obligations of UUNET Australia.......................2
3.2 Obligations of the Company...........................2
3.3 Application for Quotation............................3
3.4 Securities Act Acknowledgment; Registration Rights...3

4. MEMBERS REGISTER...............................................4

5. WARRANTIES.....................................................5
5.1 Warranties by the Company............................5
5.2 Warranty by UUNET Australia..........................5

6. ANNOUNCEMENTS..................................................5

7. NOTICES........................................................6
7.1 Service of notices...................................6
7.2 Deemed receipt.......................................6

8. WAIVER.........................................................6

9. GOVERNING LAW AND JURISDICTION.................................7

10. GENERAL PROVISIONS.............................................7
10.1 Further action.......................................7
10.2 Counterparts.........................................8

11. NON-MERGER.....................................................8

SCHEDULE 1 - UUNET AUSTRALIA ANNOUNCEMENT.................................9

SCHEDULE 2 - OZEMAIL ANNOUNCEMENT........................................10

SCHEDULE 3 - APPLICATION FORM............................................11

<PAGE>

SUBSCRIPTION AGREEMENT dated 12 December, 1998 (Sydney time)

BETWEEN

OZEMAIL LIMITED ACN 066 387 157 of Ground Floor, Building B, 39
Herbert Street, St Leonards, New South Wales ("Company")

AND

UUNET HOLDINGS AUSTRALIA PTY LIMITED ACN 085 531 684 of 44 Martin
Place, Sydney, New South Wales ("UUNET Australia")

1. DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this agreement, the following words and phrases have the following
meanings, unless the contrary intention appears:

"Announcements" means the announcements set out substantially in the form
of Schedule 1 and Schedule 2.

"Application Form" means the application form set out in Schedule 3.

"Shares" means 21,863,174 ordinary shares in the capital of the Company
(representing in aggregate no more than 14.9% of the ordinary share capital
of the Company, after the issue of the Shares).

"Subscription Date" means 12 December 1998 (Sydney time).

"Subscription Price" means US$43,726,348, representing US$2.00 per Share.

1.2 Interpretation

In this agreement, unless the contrary intention appears:

(a) headings are for ease of reference only and do not affect the meaning
of this agreement;

(b) the singular includes the plural and vice versa, and words importing a
gender include other genders;

(c) a reference to a clause, paragraph or schedule is a reference to a
clause or paragraph of or schedule to this agreement, and a reference
to this agreement includes any schedules;

(d) a reference to a document, agreement or deed, including this
agreement, includes a reference to that document or agreement or deed
as novated, altered or replaced from time to time; and

(e) a reference to a specific time for the performance of an obligation is
a reference to that time in New South Wales, Australia.

<PAGE>

2. AGREEMENT TO SUBSCRIBE

2.1 Agreement to subscribe and issue Shares

On the terms and conditions of this agreement, UUNET Australia agrees to
subscribe for the Shares, and the Company agrees to issue and allot the
Shares to UUNET Australia, at the Subscription Price on the Subscription
Date.

2.2 Confidentiality

The parties hereby terminate the confidentiality agreement dated 22 October
1998 between Goldman Sachs Australia L.L.C. (on behalf of the Company) and
UUNET Technologies, Inc, provided that UUNET Australia will not disclose in
its takeover documents any confidential information provided by Goldman
Sachs or the Company without the prior written approval of the Company (not
to be unreasonably withheld) except as required by law.

3. SUBSCRIPTION FOR THE SHARES

3.1 Obligations of UUNET Australia

On the Subscription Date, UUNET Australia must:

(a) deliver to the Company a duly completed Application Form; and

(b) pay the Subscription Price by delivery of a cheque made payable to the
Company to Skadden Arps Slate Meagher & Flom L.L.P acting as nominee
for the Company, at UUNET Technologies, Inc's offices at Fairfax,
Virginia, USA,

simultaneously with, and in consideration of, the performance of the
Company's obligations under clause 3.2.

3.2 Obligations of the Company

On the Subscription Date, the Company must:

(a) make a representative of Skadden Arps Slate Meagher & Flom L.L.P
available at UUNET Technologies, Inc's offices at Fairfax, Virginia,
USA between 9.30am and 11.30am on the Subscription Date (between
4.30pm and 8pm on December 11, 1998, New York time);

(b) issue and allot the Shares to UUNET Australia;

(c) on or before 11.30am on the Subscription Date, hand deliver a share
certificate for the Shares (or its uncertificated equivalent) to a
representative of Minter Ellison, 44 Martin Place, Sydney, New South
Wales, Australia, acting as nominee for UUNET Australia; and

(d) enter UUNET Australia's name in the register of members of the Company
in respect of the Shares,

<PAGE>

simultaneously with, and in consideration of, the performance of UUNET
Australia's obligations under clause 3.1.

3.3 Application for Quotation

The Company must apply to Australian Stock Exchange Limited for quotation
of the Shares within two business days of the Subscription Date, and use
its best endeavours to ensure that the Shares are quoted by Australian
Stock Exchange Limited as soon as possible after the Subscription Date.

3.4 Securities Act Acknowledgment; Registration Rights

(a) Securities Act Acknowledgment. UUNET Australia represents and warrants
to the Company that it is acquiring the Shares for investment purposes
and not with a view to distribution. UUNET Australia understands that
the Shares have not been and will not be registered under the United
States Securities Act of 1933 (as amended) (Securities Act"), and
agrees that it will only offer and sell the Shares:

(i) pursuant to a registration statement in accordance with the
Securities Act;

(ii) pursuant to an exemption from the registration requirements of
the Securities Act; or

(iii) in a transaction not subject to the Securities Act.

Notwithstanding any other provision of this clause 3.4, the Company
agrees that UUNET Australia may sell or dispose of such Shares, and
the Company will promptly register such transfer, upon receipt of a
certificate from UUNET Australia that such sale or disposition will
be:

(1) effected in a transaction outside the United States; or

(2) effected pursuant to an exemption from the registration
requirements of the Securities Act (including, without
limitation, a transaction effected on the Australian Stock
Exchange in compliance with Rule 904 under the Securities Act).

The Company agrees that it will not require an opinion of counsel to
effect any such transfer.

UUNET Australia further agrees that it will not deposit the Shares
into any unrestricted depositary receipt facility in respect of the
ordinary shares of the Company established or maintained by a
depositary bank unless and until such time as the Shares are no longer
subject to the restrictions on transfer applicable to "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities
Act.

(b) Notwithstanding the foregoing, the parties acknowledge that in the
event of an offer for the ordinary shares of the Company by a party
other than UUNET Australia or its direct or indirect parent
corporations, UUNET Australia will be entitled to sell the Shares, or

<PAGE>

any other shares in the Company acquired pursuant to the offer
referred to in the Announcements, or any amended offer, to such
bidder.

(c) Registration Rights. In the event that UUNET Australia makes a
takeover bid that is subsequently terminated or otherwise does not
become entitled to proceed under the Australian Corporations Law to
compulsory acquisition of all of the Company's shares, the Company
agrees, upon the request of UUNET Australia, to promptly file one
registration statement under the Securities Act and applicable
Australian laws, if any, relating to the sale of the Shares and any
other shares in the Company acquired pursuant to the offer referred to
in the Announcements, or any amended offer, to use its best efforts to
cause such registration statement to become effective, unless, in the
written opinion of counsel to the Company, in form and substance
reasonably satisfactory to UUNET Australia, such registration is not
required for the sale and distribution of the shares covered thereby
in the manner proposed by UUNET Australia, provided, however, the
Company shall be entitled to reasonable "black-out periods" during the
pendency of the registration statement. The Company agrees to use its
best efforts to maintain the effectiveness of such registration
statement, and to amend, supplement and update, if necessary, until
completion of the distribution or until such time as, in the written
opinion of counsel to the Company, in form and substance reasonably
satisfactory to UUNET Australia, such registration is not required for
the sale and distribution of the shares covered thereby in the manner
proposed by UUNET Australia. The Company agrees to co-operate in good
faith and take such other actions as are customarily required of an
issuer in a US registration rights agreement. The registration
effected under this clause 3.4(c) shall be effected at the Company's
expense except for any underwriting commissions applicable to the sale
of the shares, fees and disbursements of UUNET Australia's counsel and
any experts engaged by UUNET Australia. The Company and UUNET
Australia agree to hold harmless and indemnify each other and their
respective controlling persons, and make contribution, to the same
extent as is customary in a US registration rights agreement between
an issuer and a minority stockholder, including with respect to
advancement of expenses. The rights of UUNET Australia in this
paragraph may be assigned to any transferee who acquires the Shares or
any other shares in the Company acquired pursuant to the offer
referred to in the Announcements, or any amended offer.

4. MEMBERS REGISTER

The Company must provide a hard copy and, if the register is kept on a
computer, a copy on computer disk or computer tape, of the information on
the register of members of the Company as at the date advised by UUNET
Australia, within two business days of written request by UUNET Australia.

5. WARRANTIES

5.1 Warranties by the Company

The Company warrants and represents to UUNET Australia that:

<PAGE>

(a) the Shares represent in aggregate no more than 14.9% of the share
capital of the Company (after the issue of the Shares);

(b) the Company is under no obligation to issue or allot, and has not
granted any person the right to call for the issue or allotment of,
any shares or other securities in the capital of the Company, other
than under any employee share option plan of the Company;

(c) except for the issue of the Shares under this agreement, the Company
will not issue and allot any shares in the Company for a period of
three months after the date of this agreement, other than pursuant to
existing rights under any employee share option plan of the Company or
on exercise of existing options;

(d) the Company has the power and authority to enter into and perform its
obligations under this agreement;

(e) the issue of the Shares has been approved by the shareholders of the
Company, and the issue of the Shares by the Company will not breach
the Listing Rules of Australian Stock Exchange Limited or the
Company's constitution, subject to the accuracy of the warranty set
out in clause 5.2; and

(f) no meeting has been convened, resolution proposed, petition presented
or order made for the winding up of the Company, and no receiver,
receiver and manager, provisional liquidator, liquidator or other
officer of a court has been appointed in relation to any of its
assets, and no mortgagee has taken or attempted or indicated in any
manner any intention to take possession of any of its assets.

5.2 Warranty by UUNET Australia

UUNET Australia warrants that neither it nor any associate voted in respect
of the resolution passed at the shareholders meeting of the Company on 14
September 1998 to approve the issue of up to 50million shares.

6. ANNOUNCEMENTS

After signing of this agreement by the parties, the parties will make the
Announcements on the next business day after the Subscription Date.

7. NOTICES

7.1 Service of notices

A party giving notice or notifying under this agreement must do so in
writing:

(a) directed to the recipient's address specified in this clause, as
varied by any notice; and

(b) hand delivered or sent by facsimile to that address.

The parties' addresses and facsimile numbers are:

<PAGE>

UUNET Australia: UUNET Holdings Australia Pty Limited
Attention: Leigh Brown/David Watson
Address: c/- Minter Ellison
44 Martin Place
Sydney NSW 2000

Facsimile No.: +61 2 9210 4770

Company: OzEmail Limited
Attention: Malcolm Turnbull
Address: c/- Goldman Sachs Australia L.L.C.
Level 48
Governor Phillip Tower
1 Farrer Place
Sydney NSW 2000

Facsimile No.: + 61 2 9320 1009

7.2 Deemed receipt

A notice given in accordance with clause 7.1 is taken to be received:

(a) if hand delivered, on delivery; and

(b) if sent by facsimile, when the sender's facsimile system generates a
message confirming successful transmission of the total number of
pages of the notice unless, within eight hours after that
transmission, the recipient informs the sender that it has not
received the entire notice.

8. WAIVER

The failure of a party at any time to require performance of any obligation
under this agreement is not a waiver of that party's right:

(a) to insist on performance of, or claim damages for breach of, that
obligation unless that party acknowledges in writing that the failure
is a waiver; and

(b) at any other time to require performance of that or any other
obligation under this agreement.

9. GOVERNING LAW AND JURISDICTION

9.1 This agreement is governed by, and is to be construed in accordance with,
the law applicable in New South Wales, Australia.

9.2 Each party submits to the non-exclusive jurisdiction of the courts of New
South Wales, Australia.

<PAGE>

7
10. GENERAL PROVISIONS

10.1 Further action

Each party must:

(a) use its best efforts to do all things necessary or desirable to give
full effect to this agreement; and

(b) refrain from doing anything that might hinder performance of this
agreement.

10.2 Counterparts

This agreement may be executed in any number of counterparts.
<PAGE>

11. NON-MERGER

None of the terms or conditions of this agreement, or any act, matter or
thing done under or by virtue of this agreement or any other agreement,
instrument or document, or judgment or order of any court or judicial
proceeding, will operate as a merger of any of the rights and remedies of
the parties under this agreement, and those rights and remedies will at all
times continue in force.

EXECUTED as an agreement.

EXECUTED by UUNET HOLDINGS AUSTRALIA PTY LIMITED )
)
)

/s/ JOHN W. SIDEMORE /s/ CHARLES HENRY COVILLE
................................ ...........................................
Signature of director Signature of company secretary
(Please delete as applicable)
JOHN W. SIGDMORE CHARLES HENRY COVILLE
................................ ...........................................
Name of director (print) Name of company secretary (print)
- -------------------------------------------------------------------------------

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

EXECUTED by OZEMAIL LIMITED )
)
)

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

/s/ SEAN MARTIN HOWARD /s/ DAVID MORAY SPENCE
................................ ...........................................
Signature of director Signature of director/company secretary
(Please delete as applicable)
SEAN MARTIN HOWARD DAVID MORAY SPENCE
................................ ...........................................
Name of director (print) Name of director/company secretary (print)
- -------------------------------------------------------------------------------

<PAGE>

SCHEDULE 1 - UUNET AUSTRALIA ANNOUNCEMENT

MCI WorldCom Announces Intention to Acquire Australia's OzEmail Limited
Telecom Firm Has Purchased 14.9 Percent of Australian ISP

Jackson, Miss. and Sydney, Australia, Dec. 14,1998 -- MCI WorldCom,
Inc. (Nasdaq: WCOM) today acquired 21,863,174 newly issued ordinary shares in
OzEmail Limited ("OzEmail") and announced that it will make a cash offer for all
of the issued ordinary shares (including ADSs) of OzEmail (Nasdaq: OZEMY,
ASX: OZM).

UUNET Holdings Australia Pty Limited, a wholly owned subsidiary of MCI
WorldCom, will make an all cash offer to acquire all of the issued ordinary
shares of OzEmail at a price of US$2.20 per share, currently equivalent to
approximately A$3.54 per share(1), including ADSs at a price of US$22.00 per
ADS. OzEmail has 146,732,714 ordinary shares issued and outstanding after the
placement to MCI WorldCom, representing a total value for OzEmail's ordinary
issued and outstanding shares of approximately US$322.8 million, currently
equivalent to approximately A$520.0 million(1), based on MCI WorldCom's offer
price.

MCI WorldCom acquired the relevant interest in 21,863,174 ordinary shares
by way of a share subscription agreement with OzEmail at US$2.00 per share,
currently equivalent to approximately A$3.22 per share(1). The share
subscription agreement gave MCI WorldCom a relevant interest in approximately
14.9 percent of OzEmail's expanded issued and outstanding ordinary shares.

Subject to completion of the transaction, OzEmail would become the
Australian Internet operating arm of MCI WorldCom's UUNET subsidiary, a global
leader in Internet communications solutions.

"The Asia-Pacific region is of key strategic importance to us and the
synergies between OzEmail and MCI WorldCom are clear," said MCI WorldCom Vice
Chairman John Sidgmore. "The local fiber we are deploying in Australia
complements OzEmail's Internet presence and the vast international resources of
MCI WorldCom, particularly our worldwide Internet backbone, will bring improved
global connectivity to OzEmail's customers."

OzEmail is one of the most successful Internet Service Providers (ISPs) in
Australia. Based in Sydney, the firm offers a wide range of Internet services
throughout both Australia and New Zealand. OzEmail's network includes
approximately 80 Points of Presence (POPs) covering virtually the entire
Australian population, as well as 15 POPs in New Zealand, which provides equally
comprehensive coverage in that market. OzEmail's services include dial-up and
leased line Internet access, wholesale services to other ISPs, web hosting
services through its subsidiary WebCentral and Internet-based voice offerings.

The offer provides OzEmail shareholders with a premium of approximately 50
percent over the weighted average trading price of OzEmail shares over the last
three months on the Nasdaq National Market(2).

The offer will remain open, unless extended, for at least one month from
the date of the offer, which is expected to be in early January. Pending
commencement of the offer, a copy of any offering documents filed with the
Australian Securities and Investments Commission ("ASIC") will also be filed by
MCI WorldCom with the United States Securities and Exchange Commission ("SEC")
as an exhibit to its current report on Form 8-K, as soon as practicable after
their registration with the ASIC.

<PAGE>
The offer will be conditional upon, among other things:

MCI WorldCom being entitled to proceed, under the Australian
Corporations Law, to compulsory acquisition of all of OzEmail's shares
at the expiration of the offer;

all Australian and other necessary governmental and regulatory
approvals being received, including approval by the Foreign Investment
Review Board in Australia; and

no prescribed occurrences (as defined in the Australian Corporations
Law) (including, for example, the grant of options, liquidation or
asset disposition) occurring in relation to OzEmail or any of its
subsidiaries during the offer period.

Under the offer, OzEmail shareholders will be able to elect to receive
payment in either US or Australian dollars. Australian dollar payment will be
converted from US dollars using the exchange rate when funds are paid by MCI
WorldCom.

Merrill Lynch & Co. will act as Dealer Manager for the offer in the United
States and as financial adviser to MCI WorldCom. For further information in
relation to the offer, please contact Bruce McLennan or Fleur Jouault at Merrill
Lynch in Australia on +612-9226-5306/5342.

MCI WorldCom is a global communications company with revenue of more than
$30 billion and established operations in over 65 countries encompassing the
Americas, Europe and the Asia-Pacific regions. MCI WorldCom is a premier
provider of facilities-based and fully integrated local, long distance,
international and Internet services. MCI WorldCom's global networks, including
its state-of-the-art pan-European network and transoceanic cable systems,
provide end-to-end high-capacity connectivity to more than 38,000 buildings
worldwide. For more information on MCI WorldCom, visit the World Wide Web at
http://www.mciworldcom.com or http://www.wcom.com.

(1) Exchange rate of US$1: A$0.6208 as of December 11, 1998.

(2) Per Bloomberg Financial Markets from Friday December 11, 1998.

<PAGE>

SCHEDULE 2 - OZEMAIL ANNOUNCEMENT

PRESS RELEASE

OzEmail Announces Issue of 14.9% Stake to MCI WorldCom

OzEmail Limited announced that it has issued 21,863,174 ordinary shares
(equivalent to 2,186,317 ADSs), constituting approximately 14.9% of the
outstanding shares following the issuance, to UUNET Holdings Australia Pty
Limited, a wholly owned subsidiary of MCI WorldCom Inc., at a purchase price
equal to US$2.00 per share (equivalent to US$20.00 per ADS). OzEmail said that
its Board of Directors had approved the issue of the shares.

MCI WorldCom has advised the Company that MCI WorldCom intends to make a
takeover bid for all outstanding shares of the Company at a price of US$22.00
per ADS (US$2.20 per share) net to the seller in cash. At the OzEmail board
meeting, Malcolm Turnbull, Sean Howard, and Trevor Kennedy, directors of the
Company (who together beneficially owned approximately 54% of the outstanding
OzEmail shares prior to the MCI WorldCom issuance) indicated that, subject to
reviewing the offer documents to be prepared by MCI WorldCom and absent a more
favourable offer, they intended to accept the offer. The Board indicated that it
intends to make a recommendation to OzEmail shareholders after it has had an
opportunity to review MCI WorldCom's offer document and Part A statement.

<PAGE>

SCHEDULE 3 - APPLICATION FORM

The Directors
OzEmail Limited
Ground Floor, Building B
39 Herbert Street
St Leonards NSW 2065

Dear Directors

Application for Allotment of Shares

UUNET Holdings Australia Pty Limited ("UUNET Australia") of 44 Martin Place,
Sydney, New South Wales, applies for 21,863,174 fully paid ordinary shares in
OzEmail Limited.

UUNET Australia authorises you to record its name in the register of
shareholders of OzEmail Limited in respect of the shares the subject of this
application.

UUNET Australia has arranged for the delivery of a cheque payable to OzEmail
Limited in the amount of US$43,726,348 to Skadden Arps Slate Meagher & Flom
L.L.P acting as nominee for the Company, at UUNET Technologies, Inc's offices at
Fairfax, Virginia, USA, representing the allotment money payable for the shares
the subject of this application.

UUNET Australia agrees to be bound by the constitution of OzEmail Limited.

Yours faithfully

...............................................................
Director