Global Crossing North America, Inc – ‘DEFM14A’ on 8/6/99

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Definitive Proxy Solicitation Material — Merger or Acquisition   —   Schedule 14A
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Document/Exhibit                   Description                      Pages   Size 

 1: DEFM14A     Definitive Proxy Statement                           354   1.86M 

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SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT 

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities 
Exchange Act of 1934

Filed by the Registrant [X]                                                     

Filed by a Party other than the Registrant [_]                                  

Check the appropriate box:                                                      

[_] Preliminary Proxy Statement                                                 
[_] Confidential, for Use of the Commission (as permitted by Rule 14a-6(e)(2))  
[X] Definitive Proxy Statement                                                  
[_] Definitive Additional Materials                                             
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12               

FRONTIER CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):                              

[_] No Fee required                                                             

[_]Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.     

(1) Title of each class of securities to which transaction applies:         

(2) Aggregate number of securities to which transaction applies:            

(3) Per unit price or other underlying value of transaction computed        
 pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):          

(4) Proposed maximum aggregate value of transaction: $                      

(5) Total fee paid: $                                                       

[X] Fee paid previously with preliminary materials.                             

[_]Check box if any part of the fee is offset as provided by Exchange Act Rule  
0-11(a)(2) and identify the filing for which the offsetting fee was paid  
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.                       

(1) Amount Previously Paid: $                                               

(2) Form, Schedule or Registration Statement No.:                           

(3) Filing Party:                                                           

(4) Date Filed:                                                             

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[LOGO OF FRONTIER CORPORATION]

                                                                  August 5, 1999

Dear Shareholders:                                                              

You are cordially invited to attend a special meeting of shareholders of    
Frontier Corporation which we will hold at 10:30 a.m., local time, on September 
23, 1999, at the Crowne Plaza of Rochester, 70 State Street, Rochester, New     
York.                                                                           

 As you may know, on March 16, 1999, Frontier entered into a merger agreement,
which was amended on May 16, 1999, with Global Crossing Ltd. and a subsidiary   
of Global Crossing pursuant to which Frontier will become a wholly owned        
subsidiary of Global Crossing. The purpose of this special meeting is to adopt  
the merger agreement and approve the merger transaction described in the merger 
agreement.                                                                      

In the merger, your shares of Frontier common stock will be exchanged for a 
number of shares of Global Crossing common stock. The number of shares you will 
receive will be based on the volume weighted averages of the trading prices of  
the Global Crossing common stock for 15 randomly selected trading days during a 
30 trading day period ending one trading day before the conditions to the       
merger are satisfied or waived. If the average trading price is at least        
$34.5625 and not more than $56.7813, the value of the shares of Global Crossing 
common stock you receive for each Frontier share will be $63.00, based on the   
average trading price. You will not receive less than 1.1095 Global Crossing    
shares for each Frontier share or, subject to the next sentence, more than      
1.8229 Global Crossing shares for each Frontier share. If the average trading   
price is less than $34.5625, Frontier may terminate the merger agreement unless 
Global Crossing elects to increase the merger consideration to ensure that you  
receive consideration having a value, based on the average trading price, of    
$63.00 per share, but it is not required to terminate the merger agreement. If  
we do not complete the merger by December 31, 1999, the value of the merger     
consideration will be increased by a specified interest factor unless the       
average trading price is above $56.7813.                                        

On August 4, 1999, the Global Crossing common stock, which is listed on the 
Nasdaq National Market under the symbol "GBLX," closed at $36.00 per share.     
Based on that Global Crossing trading price, the shares of Global Crossing      
common stock that you would receive for each Frontier share would have a value  
of $63.00.                                                                      

We believe this transaction represents an exciting strategic combination.   
Your board of directors has unanimously determined that the merger is in the    
best interest of Frontier and its shareholders and recommends that you adopt    
the merger agreement with Global Crossing.                                      

 Please review carefully this entire document. You should consider the matters
discussed under the caption "Risk Factors" beginning on page 23 of the enclosed 
document before voting.                                                         

In order to vote at the special meeting, please either attend the special   
meeting, complete, sign and date the enclosed proxy and return it in the        
accompanying postage-paid envelope or cast your vote by telephone or            
electronically over the Internet.                                               

              Sincerely,

                         /s/ Joseph P. Clayton

                     Joseph P. Clayton
                           Chief Executive Officer

The Securities and Exchange Commission and the state securities regulators    
have not approved or disapproved the shares of Global Crossing common stock   
to be issued in the merger or determined if this document is accurate or      
complete. Any representation to the contrary is a criminal offense.           

This document is dated August 5, 1999 and was first mailed to 
shareholders on or about August 9, 1999.

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[LOGO OF FRONTIER CORPORATIONS] 

Notice of Special Meeting of Shareholders 
to Be Held on September 23, 1999

We will hold a special meeting of shareholders of Frontier Corporation at   
10:30 a.m., local time, on September 23, 1999, at the Crowne Plaza of           
Rochester, 70 State Street, Rochester, New York for the following purpose:      

To consider and vote upon a proposal to adopt the Agreement and Plan of 
Merger, dated as of March 16, 1999, as amended, among Global Crossing Ltd., 
GCF Acquisition Corp. and Frontier and on any other matters which may       
properly come before the meeting or which are incident to the conduct of    
the meeting. In the merger, Frontier will merge with GCF Acquisition Corp.  
and become a wholly owned subsidiary of Global Crossing and all outstanding 
shares of Frontier common stock, other than shares held by the parties to   
the merger agreement and Global Crossing's subsidiaries, will be converted  
into the right to receive a number of shares of Global Crossing common      
stock based on an exchange ratio that will be calculated shortly before the 
merger.                                                                     

 Shareholders of record at the close of business on July 29, 1999 are entitled
to vote their shares at the special meeting and any adjournments or             
postponements of it. Each share of Frontier common stock will entitle the       
record holder to one vote on each matter put to a vote at the special meeting.  

We cannot complete the merger unless the holders of two-thirds of the       
outstanding shares of Frontier common stock vote to adopt the merger agreement. 

You will need an admission card to gain entry to the special meeting. If you
are planning to attend the special meeting, please check the appropriate box on 
the proxy card. Your admission card will be available at the registration table 
at the special meeting. The special meeting will be sign language interpreted   
for the hearing impaired.                                                       

For more information about the merger, please review the accompanying       
document and the merger agreement attached as Annex A. A copy of this document  
is also available on Frontier's web site which can be found at:                 
http://www.frontiercorp.com.                                                    

Your vote is very important. Please either vote electronically or sign and  
date the enclosed proxy card and return it promptly in the enclosed return      
envelope, whether or not you plan to attend the meeting. The accompanying       
envelope requires no postage if mailed in the United States. If you do not      
specify your vote on your submission, your shares will be voted FOR the         
adoption of the merger agreement. If you fail to submit a proxy or vote         
electronically or if you abstain from voting, it will have the effect of a vote 
against the adoption of the merger agreement. You may revoke your proxy and     
vote in person if you decide to attend the special meeting.                     

Please do not send in any stock certificates at this time.                      

By action of the Board of Directors,                                            

/s/ Josephine S. Trubek                                                         

JOSEPHINE S. TRUBEK                                                             
Corporate Secretary                                                             

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To find any of the principal sections identified below, simply bend the 
document slightly to expose the black tabs and open the document to the tab 
which corresponds to the title of the section you wish to read.             

                                                               Table of contents

                                            Questions & answers about the merger

                                             Summary; Risk factors; The meetings

                            The merger; The merger agreement; Related agreements

                                       Unaudited pro forma financial information

            The companies; Global Crossing common stock; Shareholder information

                Global Crossing annual meeting proposals and related information

                                                          Additional information

                       Financial statements of Global Crossing and Global Marine

                                                                         Annexes

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Table of Contents 

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                                                                                      ----
                                                                                          
Questions & Answers about the Merger.................................................  vi 
Summary..............................................................................   1 
  Overview...........................................................................   1 
  The companies......................................................................   1 
  What you will receive in the merger................................................   1 
  Ownership of Global Crossing after the merger......................................   4 
  Tax consequences...................................................................   4 
  Board recommendations..............................................................   4 
  Interests of members of Frontier's board of directors and management in the             
   merger............................................................................   4 
  Opinions of financial advisors.....................................................   4 
  Record date for voting; Required votes.............................................   5 
  Conditions to the completion of the merger.........................................   5 
  Termination of the merger agreement; Fees payable..................................   6 
  Regulatory matters.................................................................   7 
  Accounting treatment...............................................................   7 
  No appraisal rights................................................................   7 
  Trading of Global Crossing common stock............................................   7 
  Transactions with Qwest and U S WEST...............................................   7 
  Selected historical financial information..........................................   9 
  Selected unaudited pro forma financial information.................................  16 
  Comparative per share data.........................................................  20 
  Market prices and dividends........................................................  21 
Risk Factors.........................................................................  23 
Cautionary Statement Regarding Forward-Looking Statements............................  31 
The Global Crossing Annual Meeting...................................................  32 
  General............................................................................  32 
  Date, time and place...............................................................  32 
  Matters to be considered at the meeting............................................  32 
  Record date; votes per share.......................................................  33 
  Quorum.............................................................................  33 
  Votes required.....................................................................  34 
  How shares will be voted at the annual meeting.....................................  34 
  How to revoke a proxy..............................................................  35 
  Solicitation of proxies..........................................................    35 
  1998 audited financial statements................................................    35 
The Frontier Special Meeting.........................................................  36 
  General..........................................................................    36 
  Date, time and place.............................................................    36 
  Matter to be considered at the special meeting...................................    36 
  Record date......................................................................    36 
  Vote required....................................................................    36 
  How shares will be voted at the special meeting..................................    36 
  Voting at the special meeting....................................................    37 
  Methods of voting................................................................    37 
  How to revoke a proxy............................................................    37 
  Solicitation of proxies..........................................................    37 
The Merger...........................................................................  39 
  What you will receive in the merger..............................................    39 
  Background of the merger.........................................................    39 

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  Recommendation of the Global Crossing board of directors; Reasons for        
   the merger.............................................................  45 
  Opinions of Global Crossing's financial advisors........................  47 
  Recommendation of the Frontier board of directors; Reasons for the           
   merger.................................................................  57 
  Opinion of Frontier's financial advisor.................................  58 
  Interests of members of Frontier's board of directors and management in      
   the merger.............................................................  66 
  Certain federal income tax and Bermuda tax consequences ................  68 
  Anticipated accounting treatment........................................  74 
  Regulatory approvals....................................................  74 
  No appraisal rights.....................................................  75 
  Quotation on the Nasdaq National Market.................................  75 
  Litigation..............................................................  75 
  Resales of Global Crossing common stock.................................  75 
The Merger Agreement......................................................  77 
  The merger..............................................................  77 
  Effective time of the merger............................................  77 
  Exchange procedures.....................................................  77 
  Frontier preferred stock................................................  78 
  Stock options and warrants..............................................  78 
  Representations and warranties..........................................  78 
  Covenants...............................................................  79 
  No solicitation of transactions.........................................  81 
  Board of directors' covenant to recommend...............................  82 
  Transition planning; Continued operations of Frontier...................  82 
  Services agreement......................................................  82 
  Reasonable best efforts.................................................  83 
  Employee benefits.......................................................  83 
  Indemnification and insurance...........................................  83 
  Conditions to the completion of the merger..............................  83 
  Termination; Possible exchange ratio increase...........................  84 
  Termination fees........................................................  87 
  Other expenses..........................................................  87 
  Amendments and waivers..................................................  87 
  Alternative merger structure............................................  88 
Related Agreements........................................................  89 
  Stock option agreement..................................................  89 
  Voting agreement........................................................  90 
Unaudited Pro Forma Condensed Combined Financial Statements ..............  92 
The Companies.............................................................  98 
  Global Crossing Ltd. ...................................................  98 
    Overview..............................................................  98 
    Recent developments...................................................  98 
    Business activity.....................................................  99 
    The Global Crossing network........................................... 100 
    Atlantic Crossing..................................................... 101 
    Pacific Crossing...................................................... 102 
    Mid-Atlantic Crossing................................................. 102 
    Pan American Crossing................................................. 102 
    South American Crossing............................................... 103 
    Terrestrial capacity.................................................. 103 
    Additional network expansion opportunities............................ 104 
    Other activities...................................................... 104 

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    Financing plan........................................................  104 
    System performance....................................................  105 
    Sales and marketing...................................................  106 
    Summary of principal terms of standard contractual documentation......  107 
    Operations, administration and maintenance support ...................  107 
    Competition...........................................................  108 
    Suppliers.............................................................  110 
    Regulation............................................................  110 
    Employees.............................................................  110 
    Financial information by business segment and geographic area.........  110 
  Frontier Corporation....................................................  111 
    Strategy..............................................................  111 
    Integrated services...................................................  112 
    Transmission..........................................................  114 
    Local communications services.........................................  115 
Global Crossing's Management Discussion and Analysis of Financial               
 Condition and Results of Operations......................................  116 
  Overview................................................................  116 
  Revenues and deferred revenues..........................................  116 
  Cost of sales...........................................................  117 
  Operating expenses......................................................  118 
  Results of operations for the three months ended June 30, 1999 and June       
   30, 1998...............................................................  118 
  Results of operations for the six months ended June 30, 1999 and June         
   30, 1998...............................................................  121 
  Results of operations for the year ended December 31, 1998 and the            
   period from March 19, 1997 (date of inception) to December 31, 1997....  123 
  Liquidity and capital resources.........................................  126 
  Inflation...............................................................  128 
  Year 2000 compliance....................................................  128 
  Euro conversion.........................................................  129 
  Qualitative and quantitative disclosures about market risk..............  129 
  Foreign Currency Risk...................................................  130 
Stock Ownership of Management, Directors and 5% Shareholders of Global          
 Crossing.................................................................  131 
Stock Ownership of Management, Directors and 5% Shareholders of Frontier..  133 
Description of Global Crossing Capital Stock..............................  135 
  General.................................................................  135 
  Voting and transfer restrictions........................................  135 
  Distributions...........................................................  136 
  Global Crossing stockholders agreement and registration rights                
   agreement..............................................................  136 
Some Differences Between Rights of Shareholders of Frontier and Rights of       
 Shareholders of Global Crossing..........................................  137 
  Size and classification of the board of directors.......................  137 
  Removal of directors; vacancies; alternate directors....................  137 
  Meetings of shareholders................................................  138 
  Action by written consent of shareholders; shareholder resolutions......  138 
  Vote required for extraordinary corporate transaction...................  138 
  Interested director transactions........................................  139 
  Transfer restrictions...................................................  139 
  Business combination statutes...........................................  139 
  Shareholder suits.......................................................  140 

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  Dissenters' rights....................................................... 140 
  Dividends................................................................ 141 
  Voting................................................................... 141 
  Preemptive rights........................................................ 141 
  Amendments to corporate governance documents............................. 141 
  Limitations on directors' liability...................................... 142 
  Rights of inspection..................................................... 142 
  Repurchase of untraced shares............................................ 143 
  Indemnification of Global Crossing by shareholders for some taxes and         
   other impositions....................................................... 143 
  Indemnification of officers and directors................................ 143 
  Indemnification of shareholders by Global Crossing for some taxes........ 144 
  Rights agreement......................................................... 144 
  "Anti-Greenmail"......................................................... 144 
  Listing.................................................................. 144 
Proposals to Global Crossing Shareholders To Be Voted on at the Global          
 Crossing Annual Meeting................................................... 145 
  Proposal No. 1: Increase in Global Crossing's authorized share capital... 145 
  Proposal No. 2: Issuance of shares of Global Crossing common stock in the     
   merger.................................................................. 147 
  Proposals Nos. 3 and 4: Amendment and restatement of Global Crossing bye-     
   laws.................................................................... 147 
   Proposal No. 3: Amendment and restatement of Global Crossing bye-laws        
    (other than bye-laws 34(2), 63, 130 and 148)........................... 147 
   Proposal No. 4: Amendment and restatement of Global Crossing bye-laws        
    34(2), 63, 130 and 148................................................. 150 
  Proposal No. 5: Election of directors.................................... 151 
  Proposal No. 6: Amendment of the 1998 Global Crossing Ltd. Stock              
   Incentive Plan ......................................................... 155 
  Proposal No. 7: Ratification of outside directors' compensation.......... 157 
  Proposal No. 8: Ratification of Arthur Andersen & Co. as Global               
   Crossing's independent auditors for 1999 and approval of the board of        
   directors' authority to determine their remuneration.................... 158 
  Receipt of financial statements.......................................... 158 
Global Crossing Executive Compensation..................................... 159 
  Compensation committee report............................................ 159 
  Summary compensation table............................................... 161 
  Certain compensation arrangements........................................ 161 
  Compensation of outside directors........................................ 162 
  Option grants in last fiscal year........................................ 163 
  Aggregated option exercises in last fiscal year and fiscal year-end           
   option values........................................................... 164 
  Compensation committee interlocks and insider participation.............. 164 
  Compliance with Section 16 of the Exchange Act........................... 164 
  Comparison of cumulative total returns................................... 165 
Some Global Crossing Transactions.......................................... 166 
  Transactions with Pacific Capital Group and its affiliates............... 166 
  Transactions with Canadian Imperial Bank of Commerce and its affiliates.. 168 
  Transactions with Worldport.............................................. 168 
  Transactions with Telecommunications Development Corporation............. 169 
Legal Matters.............................................................. 170 
Experts.................................................................... 170 
Service of Process and Enforcement of Liabilities.......................... 170 
Submission of Future Shareholder Proposals................................. 170 
  Global Crossing.......................................................... 170 
  Frontier................................................................. 171 
Where You Can Find More Information........................................ 171 

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Global Crossing Financial Statements.......................................  F-1
Global Marine Financial Statements......................................... F-45

                                                        [Enlarge/Download Table]
                                                                                                      
Annex A    Agreement and Plan of Merger and Consent and Amendment No. 1                               
Annex B    Stock Option Agreement                                                                     
Annex C    Voting Agreement                                                                           
Annex D-1  Opinion of Salomon Smith Barney, dated as of March 16, 1999                                
Annex D-2  Opinion of Salomon Smith Barney, dated as of May 16, 1999                                  
Annex E    Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated                              
Annex F    Opinion of Morgan Stanley & Co. Incorporated                                               
Annex G    Resolutions of Global Crossing's board of directors in connection with the annual meeting  
Annex H    1998 Global Crossing Ltd. Stock Incentive Plan                                             

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Questions & Answers 
about the Merger

Q: Why are the two companies proposing the merger?                              

A: Global Crossing and Frontier believe that the merger will create an          
innovative, highly competitive company with an integrated high capacity global  
telecommunications and Internet network. Global Crossing and Frontier believe   
that the combined company will be well-positioned to                            

.  meet the growing bandwidth demand worldwide required to handle Internet,   
data, video and voice transmissions,                                      

.  capitalize on future growth opportunities and                              

.  provide more comprehensive products, services and support to customers     
across both the Internet and the public communications networks.          

To review the reasons for the merger in greater detail, see pages 45 through 47 
and 57 through 58.                                                              

Q: What do I need to do now?                                                    

A: Global Crossing shareholders:                                                

After you carefully read this document, please indicate on the enclosed proxy   
card how you want to vote. Sign and mail the proxy card in the enclosed return  
envelope as soon as possible, so that your shares may be represented at the     
Global Crossing annual meeting.                                                 

Frontier shareholders:                                                          

First, carefully read this document. There are several ways your shares can be  
represented at the Frontier special meeting. You can indicate on the enclosed   
proxy card how you want to vote and then sign and mail the proxy card in the    
enclosed return envelope as soon as possible. You can also cast your vote       
electronically by telephone by calling the number on your proxy card or over    
the Internet by going to the web site designated on your proxy card.            

Q: If my broker holds my shares in "street name," will my broker vote my        
shares?                                                                         

A: Your broker will not vote your shares unless you follow the directions your  
broker provides to you regarding how to vote your shares.                       

Q: What do I do if I want to change my vote?                                    

A: You can change your vote by sending in a notice of revocation or a later-    
dated, signed proxy card to your company's Secretary before your shareholders   
meeting or by attending the meeting in person and voting. Frontier shareholders 
can also change their vote by voting by telephone or Internet at a later time.  

Q: What do I need to do to get my Global Crossing shares?                       

A: After the merger is completed we will send Frontier shareholders written     
instructions for exchanging their stock certificates. Frontier shareholders     
should not send in their stock certificates now. Global Crossing shareholders   
will keep their existing certificates.                                          

Q: Will I continue to receive a dividend on my shares after the merger?         

A: Global Crossing does not currently pay cash dividends on its common stock    
and does not anticipate paying dividends in the foreseeable future.             

Q: When do you expect to complete the merger?                                   

A: We expect to complete the merger late in the third quarter or early in the   
fourth quarter of 1999. We are working toward completing the merger as quickly  
as possible and expect to do so shortly after the meetings, provided that we    
have obtained the regulatory approvals necessary for the merger.                

Q: Who should I call with questions?                                            

A: Global Crossing shareholders:                                                

Investor Relations--Global Crossing                                         
Attention: Jensen Chow                                                      
(310) 385-5200                                                              

Frontier shareholders:                                                          

Innisfree M&A Incorporated                                                  
(888) 750-5835                                                              

Investor Relations--Frontier                                                
(800) 573-2473                                                              

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Summary 

This summary highlights selected information from this document. It does not
contain all of the information that is important to you. We urge you to read    
carefully the entire document and the other documents referred to in this docu- 
ment to fully understand the merger. More information on Global Crossing is in- 
cluded in this document beginning on page 98. For a guide as to where you can   
obtain more information on Frontier, see "Where You Can Find More Information"  
on page 171.                                                                    

Overview                                                                        

Global Crossing, Frontier and a wholly owned subsidiary of Global Crossing  
entered into a merger agreement on March 16, 1999 which was amended on May 16,  
1999. Under the terms of the Global Crossing--Frontier merger agreement, at the 
closing, shares of Frontier common stock will be converted into the right to    
receive a number of shares of Global Crossing common stock based on an exchange 
ratio that will be calculated shortly before the closing. Upon completion of    
the merger, Frontier will become a wholly owned subsidiary of Global Crossing.  

The companies                                                                   

Global Crossing Ltd. (Page 98)                                                  
Wessex House                                                                    
45 Reid Street                                                                  
Hamilton HM12, Bermuda                                                          
(441) 296-8600                                                                  

Global Crossing is building the world's first independent global network of 
state-of-the-art Internet and long distance telecommunications facilities util- 
izing a combination of undersea and terrestrial digital fiber optic cable sys-  
tems. Global Crossing offers "one-stop shopping" for its customers to multiple  
destinations worldwide and currently operates as a "carrier's carrier," provid- 
ing tiered pricing and segmented products to licensed providers of interna-     
tional telecommunications services. Capacity on the Global Crossing network is  
offered to all customers on an open, equal access basis.                        

 Upon completion, the currently announced segments of the Global Crossing net-
work will directly connect Asia, North America, Europe, Central America, South  
America and the Carribean and, in addition, will provide terrestrial services   
to major cities in the United States, Europe, South America, Mexico and Japan.  
The undersea component of this initial portion of the Global Crossing network   
totals 74,700 km, and the terrestrial component adds 17,800 km, for a total of  
92,500 km.                                                                      

 On July 2, 1999, Global Crossing acquired the Global Marine business of Cable
& Wireless plc. Global Marine is the world's largest undersea cable installa-   
tion and maintenance company with a fleet of 13 cable ships, representing ap-   
proximately 33% of the world's total, 21 submersible vehicles and 1,200 employ- 
ees servicing approximately 35% of the world's undersea cable miles.            

Frontier Corporation (Page 111)                                                 

180 South Clinton Avenue                                                        
Rochester, New York 14646-0700                                                  
(716) 777-1000                                                                  

Frontier's subsidiaries provide integrated telecommunications services in-  
cluding Internet, Internet Protocol and data applications, long distance, local 
telephone and enhanced services to business, carrier, web-centric and targeted  
residential customers nationwide and in some foreign countries.                 

Through its Integrated Services segment, Frontier is one of the nation's    
largest long distance companies and its Frontier Optronics NetworkSM is nearing 
completion. When completed, Frontier Optronics NetworkSM will consist of ap-    
proximately 20,000 route miles: the core fiber network will offer more than     
13,000 miles of dense wave division multiplexed optical fiber capacity and an-  
other 3,000 miles are currently under construction in the southeast United      
States. In addition, 4,000 miles of network are available through network       
swaps.                                                                          

What you will receive in the merger (Page 39)                                   

Global Crossing shareholders:                                                 

After the merger each share of Global Crossing common stock will remain out-
standing.                                                                       

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Frontier shareholders:                                                        

When we complete the merger, each Frontier share will be canceled and each  
Frontier shareholder will receive for each share of Frontier common stock a     
number of shares of Global Crossing common stock based on a floating exchange   
ratio, subject to a collar:                                                     

                                                                [Download Table]

                     If the average                                             
                    Global Crossing                       This is the number of 
                  trading price during                       Global Crossing    
                    the measurement                      shares to be issued for
                       period is:                         each Frontier share:  
                  --------------------                   -----------------------
                                                                                
more than $56.7813......................................  1.1095                
between $34.5625 and $56.7813...........................  $63.00 divided by     
                                                          the average Global    
                                                          Crossing trading      
                                                          price during the      
                                                          measurement period    
                                                          (a number between     
                                                          1.1095 and 1.8229),   
                                                          subject to increase   
                                                          if the closing        
                                                          occurs after          
                                                          December 31, 1999 as  
                                                          described below       
                                                          under "--Interest     
                                                          Factor"               
less than $34.5625......................................  1.8229, subject to    
                                                          Frontier's walk-away  
                                                          right and Global      
                                                          Crossing's top-up     
                                                          right and subject to  
                                                          increase if the       
                                                          closing occurs after  
                                                          December 31, 1999,    
                                                          as described below    
                                                          under "--Interest     
                                                          Factor"               

The floating exchange ratio is intended to provide you with shares of Global
Crossing common stock valued at $63.00, based on the average trading price of   
the Global Crossing common stock during the measurement period, so long as that 
average Global Crossing trading price remains between $34.5625 and $56.7813.    
The measurement period for purposes of determining the exchange ratio is 15     
randomly selected trading days during a 30 trading-day period ending one trad-  
ing day before the conditions to the merger are satisfied or waived. In addi-   
tion, the collar means that the number of shares of Global Crossing common      
stock that Frontier shareholders will receive for each Frontier share in the    
merger will                                                                     

. never be less than 1.1095, regardless of what happens to Global Crossing's  
stock price during the measurement period, and                              

. never be more than 1.8229 except as described below.                        

Walk-Away Right/Top-Up Right. If the average trading price of the Global    
Crossing common stock during the measurement period is less than $34.5625,      
Frontier may, but is not required to, terminate the merger agreement unless     
Global Crossing agrees to increase the merger consideration. If Frontier elects 
to terminate the merger agreement, Global Crossing may elect to increase the    
merger consideration so that Frontier shareholders will receive consideration   
having a value, based on the average trading price of the Global Crossing com-  
mon stock during the measurement period, of $63.00 for each share of Frontier   
common stock. Global Crossing may use additional shares of Global Crossing com- 
mon stock to increase the merger consideration or may also use cash or a combi- 
nation of cash and stock under some circumstances.                              

Since the date of the merger agreement, the Global Crossing common stock has
traded within a range from $32.94 to $64.25. The average trading price for      
purposes of determining the exchange ratio will be based on the trading prices  
of the Global Crossing common stock during the measurement period shortly       
before the closing, which measurement period may end after the date of the      
Frontier special meeting.                                                       

Interest Factor. If the merger closing does not occur by December 31, 1999, 
the value of the shares of Global Crossing common stock to be received by Fron- 
tier shareholders in the merger will be increased by an interest factor equal   
to 7% per annum, compounded daily, from and after December 31, 1999 to the ef-  
fective time of the merger. This interest factor will not apply if the average  
trading price for the Global Crossing common stock during the measurement pe-   
riod is more than $56.7813. Therefore, if the merger closes after December 31,  
1999, Frontier shareholders will receive for each Frontier share                

. a number of Global Crossing shares with a value of $63.00, as increased by  
the 7% per annum in-                                                        
terest factor, if the average trading price during the measurement period is
between $34.5625 and $56.7813,                                              

 . 1.8229 Global Crossing shares, as increased by the 7% per annum interest fac-
tor, if the average trading price during the measurement period is less than
$34.5625, or                                                                

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. 1.1095 Global Crossing shares, without any increase for the 7% per annum in-
terest factor, if the average trading price is more than $56.7813.          

For purposes of the examples contained in this document, we have assumed that   
the closing will occur by December 31, 1999 unless we have indicated otherwise. 

 Calculation of the Exchange Ratio. Assuming the average Global Crossing trad-
ing price during the measurement period is $36.00, which was the closing price  
of the Global Crossing common stock on August 4, 1999, because the price is be- 
tween $34.5625 and $56.7813, the exchange ratio would be 1.7500. Based on that  
Global Crossing stock price, the value of the merger consideration per share of 
Frontier common stock would be $63.00. The initial value of the shares of       
Global Crossing common stock you receive in the merger may be more or less than 
the value based on the average price because the trading price of the Global    
Crossing common stock at closing may be higher or lower than the average trad-  
ing price during the measurement period or because the average trading price    
may be outside the collar.                                                      

The table below shows a range of assumed average trading prices of Global   
Crossing common stock along with entries showing the corresponding exchange ra- 
tios and values of the shares of Global Crossing common stock that would be is- 
sued in the merger in exchange for one share of Frontier common stock, based on 
the assumed average trading prices presented in the first column of the table.  

 Because the calculation of the exchange ratio depends on when we complete the
merger, the actual number of shares of Global Crossing common stock issuable in 
the merger for each share of Frontier common stock may be different from the    
examples listed in the table below and in this document. In addition, the val-  
ues of the Global Crossing common stock are illustrative only and do not repre- 
sent the actual amount per share of Global Crossing common stock that might be  
realized by any Frontier shareholder on or after the effective time of the      
merger. Frontier shareholders are urged to obtain and review current market     
quotations for Global Crossing common stock.                                    

Table of Illustrative Values

                                                                [Download Table]

                                   Illustrative 
                Assumed              value of   
                 Global               merger    
                Crossing           consideration
                average            per share of 
                trading   Exchange   Frontier   
                 price     ratio   common stock 
                --------  -------- -------------
                                                
                 $60.00    1.1095     $66.57    
                  59.00    1.1095      65.46    
                  58.00    1.1095      64.35    
                  57.00    1.1095      63.24    
   Minimum                                      
Exchange Ratio    56.7813  1.1095      63.00    
                  56.00    1.1250      63.00    
                  55.00    1.1455      63.00    
                  54.00    1.1667      63.00    
                  53.00    1.1887      63.00    
                  52.00    1.2115      63.00    
                  51.00    1.2353      63.00    
                  50.00    1.2600      63.00    
                  49.00    1.2857      63.00    
                  48.00    1.3125      63.00    
                  47.00    1.3404      63.00    
                  46.00    1.3696      63.00    
                  45.00    1.4000      63.00    
                  44.00    1.4318      63.00    
                  43.00    1.4651      63.00    
                  42.00    1.5000      63.00    
                  41.00    1.5366      63.00    
                  40.00    1.5750      63.00    
                  39.00    1.6154      63.00    
                  38.00    1.6579      63.00    
                  37.00    1.7027      63.00    
                  36.00    1.7500      63.00    
                  35.00    1.8000      63.00    
   Maximum                                      
Exchange Ratio    34.5625  1.8229      63.00    
  Walk-Away                                     
 Right/Top-Up                                   
    Right         34.00    1.8229      61.98    
                  33.00    1.8229      60.16    
                  32.00    1.8229      58.33    
                  31.00    1.8229      56.51    
                  30.00    1.8229      54.69    

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Ownership of Global Crossing after the merger                                   

Assuming that the closing occurs by December 31, 1999, Global Crossing will 
issue between approximately 192,523,809 shares and 316,315,144 shares of common 
stock in the merger since the exchange ratio can vary between 1.1095 and        
1.8229. These shares will represent between approximately 32% and 43% of the    
outstanding shares of Global Crossing common stock immediately after the merg-  
er. This information is based on the number of outstanding shares of Frontier   
on July 29, 1999 and the number of outstanding shares of Global Crossing on     
July 29, 1999, without taking into account shares issuable upon exercise of     
stock options or warrants.                                                      

Tax consequences (Page 68)                                                      

We expect the merger to qualify as a tax-free reorganization for United     
States federal income tax purposes. In general, Frontier shareholders will not  
recognize any gain or loss on the exchange of Frontier common stock for Global  
Crossing common stock, except to the extent they receive cash instead of        
fractional shares or otherwise as merger consideration.                         

There will be no Bermuda tax of any kind payable in respect of the exchange 
of shares in themerger. We urge Frontier shareholders to consult their own tax  
advisors to discuss the tax consequences of the merger.                         

Board recommendations                                                           

Global Crossing (Page 45):                                                    

The Global Crossing board of directors unanimously recommends that you vote 
FOR the proposals to approve the increase in authorized share capital and the   
share issuance, FOR the director nominees to be elected and FOR each other      
proposal presented at the 1999 annual meeting.                                  

Frontier (Page 57):                                                           

The Frontier board of directors unanimously recommends that you vote FOR the
proposal to adopt the merger agreement.                                         

Interests of members of Frontier's board of directors and management in the     
merger (Page 66)                                                                

 Some Frontier directors, officers and executives have interests in the merger
that may be different from, or in addition to, the interests of other Frontier  
shareholders. These interests include employment agreements and stock options.  
In addition, some Frontier directors and executive officers will become Global  
Crossing directors or executive officers after the merger. You should be aware  
of these interests because they may conflict with yours. These interests in-    
clude:                                                                          

. eighteen of Frontier's officers and executives will become entitled to      
 enhanced severance benefits, including cash payments and other benefits under
specified circumstances, upon the termination of their employment following 
the merger,                                                                 

. all stock options held by directors and employees of Frontier will vest and 
become immediately exercisable,                                             

. when we complete the merger, four of the current directors of Frontier will 
be appointed to the Global Crossing board of directors, and                 

. Global Crossing has agreed to take all action necessary to elect Joseph P.  
Clayton as a Vice Chairman of Global Crossing and Rolla P. Huff as President
and Chief Operating Officer of North American Operations of Global Crossing.

Opinions of financial advisors                                                  

Global Crossing (Page 47):                                                    

Salomon Smith Barney and Merrill Lynch, Pierce, Fenner & Smith Incorporated 
each delivered an opinion to the Global Crossing board of directors that, as of 
March 16, 1999, the original exchange ratio was fair from a financial point of  
view to Global Crossing. In addition, Salomon Smith Barney delivered an opinion 
to the Global Crossing board of directors that, as of May 16, 1999, the         
exchange ratio, as revised on that date, was fair from a financial point of     
view to Global Crossing. Merrill Lynch was not requested to deliver and did not 
deliver an opinion regarding the revised exchange ratio because it represented  
U S WEST in the proposed Global Crossing--U S WEST merger. These opinions are   
not recommendations to any                                                      

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Global Crossing shareholder as to how to vote. We have attached these opinions  
as Annexes D-1, D-2 and E to this document. You should read them in their       
entirety.                                                                       

Frontier (Page 58):                                                           

Morgan Stanley & Co. Incorporated delivered an opinion to the Frontier board
of directors that, as of March 16, 1999, the original exchange ratio was fair   
from a financial point of view to Frontier's shareholders. In addition, Morgan  
Stanley delivered an opinion to the Frontier board of directors that, as of May 
16, 1999, the exchange ratio, as revised on that date, was fair from a finan-   
cial point of view to Frontier's shareholders. This opinion is not a recommen-  
dation as to how any Frontier shareholder should vote with respect to the merg- 
er. We have attached the May 16, 1999 opinion to this document as Annex F. You  
should read it in its entirety.                                                 

Record date for voting; Required votes                                          

Global Crossing shareholders (Page 33):                                       

You can vote at the 1999 annual meeting of Global Crossing shareholders if  
you own Global Crossing common stock on the date of the meeting. You will be    
entitled on a poll to one vote per share. If, however, you hold more than 9.5%  
of all outstanding shares of Global Crossing common stock, your voting power    
will be limited. You will also beentitled to any additional votes that may be   
allocated to your shares pursuant to a formula contained in the Global Crossing 
bye-laws, but you will not be allocated any additional votes if you own more    
than 9.5% of the outstanding shares.                                            

The approval of at least a majority of all outstanding shares of Global     
Crossing common stock is required to adopt the proposals relating to the in-    
crease in authorized share capital, the share issuance and each other proposal  
presented at the annual meeting, with the exception of some proposed amendments 
to the Global Crossing bye-laws, which require the approval of 75% of all out-  
standing shares of Global Crossing common stock.                                

Shareholders representing more than a majority of the voting power of Global
Crossing have entered into a voting agreement with Frontier in which they       
agreed to vote in favor of both the proposal to in crease the authorized share  
capital of Global Crossing and the proposal to issue Global Crossing shares in  
the merger. The vote of these shareholders will be sufficient to approve these  
two proposals without any further vote by any other Global Crossing sharehold-  
er. We have attached a copy of the voting agreement as Annex C to this docu-    
ment. You should read it in its entirety.                                       

Frontier shareholders (Page 36):                                              

You can vote at the special meeting of Frontier shareholders if you owned   
Frontier common stock at the close of business on July 29, 1999. The approval   
of two-thirds of the outstanding shares of Frontier common stock is required to 
adopt the merger agreement.                                                     

Conditions to the completion of the merger (Page 83)                            

The completion of the merger depends on the satisfaction or waiver of a num-
ber of conditions, including the following:                                     

. adoption of the merger agreement by Frontier's shareholders,                

.approval by Global Crossing's shareholders of the increase of its authorized 
share capital and of the issuance of the Global Crossing shares in the merger,

. the absence of legal prohibitions to the merger,                            

 . the absence of any stop order suspending theeffectiveness of the registration
statement relating to the Global Crossing shares to be issued in the merger 
and approval of those shares for trading on the Nasdaq National Market,     

. receipt of all FCC and state public utility commission approvals without the
 imposition of conditions that would reasonably be expected to have a material
adverse effect on Global Crossing and its subsidiaries after the merger,    
 other than approvals which, if not obtained, would not reasonably be expected
to result in a material adverse effect on Global Crossing and its subsidiar-
ies after the merger,                                                       

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 . expiration or termination of the waiting periodapplicable to the merger under
the Hart-Scott-Rodino Act, which was terminated on May 11, 1999,            

. receipt of the approval of the issuance and subsequent free transferability 
of Global Crossing shares by the Bermuda Monetary Authority, which approval 
was received on July 1, 1999,                                               

. receipt of opinions with respect to the tax-free nature of the merger,      

 . redemption of all outstanding Frontier preferred stock, which was redeemed on
July 1, 1999, and                                                           

. material compliance by Global Crossing and Frontier with their obligations, 
and the truth and correctness of the representations made by each of them,  
under the merger agreement.                                                 

Termination of the merger agreement; Fees payable (Pages 84 and 87)             

1. Global Crossing and Frontier may agree to terminate the merger agreement at  
any time if both companies agree.                                         

2. Either Global Crossing or Frontier may also terminate the merger agreement   
if:                                                                       

. the merger is not completed by March 16, 2000, except that if all the     
conditions to completing the merger have been satisfied or waived other 
than the conditions relating to FCC and state public utility commission 
approvals, then Global Crossing cannot terminate for this reason,       

. a governmental entity permanently prohibits the merger or has finally de- 
termined not to issue an order required to fulfill the conditions de-   
scribed in the fifth and sixth bullet points above under "Conditions to 
the completion of the merger,"                                          

. the Frontier shareholders do not adopt the merger agreement, or           

. the Global Crossing shareholders do not approve the proposals to increase 
its authorized share capital and issue Global Crossing shares in the    
merger.                                                                 

3. Global Crossing may terminate the merger agreement if, before the Frontier   
  special meeting, the Frontier board of directors withdraws or adversely mod-
ifies its approval of the merger or approves or recommends a              
  superiorproposal. Frontier is required to pay Global Crossing a $270 million
 termination fee ifFrontier terminates the merger agreement for this reason.

4. Frontier may terminate the merger agreement:                                 

. at any time before the Frontier special meeting if the Frontier board of  
directors approves a superior proposal; however, Frontier must have com-
plied with the relevant provisions of the merger agreement relating to  
not soliciting alternative proposals to acquire Frontier. Frontier may  
only exercise this termination right if it pays Global Crossing a $270  
million termination fee and complies with specified notice and waiting  
period provisions in the merger agreement, or                           

. if the average share price of Global Crossing common stock to be used in  
calculating the exchange ratio is less than $34.5625, unless Global     
Crossing agrees to increase the merger consideration so that Frontier   
shareholders receive consideration having a value, based on the average 
trading price of Global Crossing common stock during the measurement pe-
riod, of $63.00 per share.                                              

Frontier's board of directors cannot assure you that it would exercise its  
right to terminate the merger agreement if the average price was less than      
$34.5625. If the Frontier board of directors exercises its right to terminate   
the merger agreement for this reason, Global Crossing's board of directors can- 
not assure you that it would increase the merger consideration. Adoption of the 
merger agreement by Frontier's shareholders and approval by Global Crossing's   
shareholders of the increase in the authorized share capital and the issuance   
of Global Crossing shares in the merger will give                               

 . the Frontier board of directors the power but not the obligation to decide to
complete the merger if the average trading price of the Global Crossing     

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common stock during the measurement period is less than $34.5625 and        

 .the Global Crossing board of directors the power but not the obligation to de-
cide to increase the merger consideration in the event that the Frontier board
of directors exercises its right to terminate the merger agreement.           

These powers can be exercised by the Frontier board of directors and the    
Global Crossing board of directors without any further action or resolicitation 
of the Frontier shareholders or the Global Crossing shareholders.               

 Frontier is required to pay Global Crossing a $270 million termination fee if
the merger agreement is terminated under specified circumstancesafter a third   
party makes a proposal to acquire Frontier.                                     

In addition, on March 16, 1999, Frontier and Global Crossing entered into a 
stock option agreement under which Frontier has granted to Global Crossing an   
option to purchase up to 19.9% of the Frontier common stock at a price of       
$62.00 per share, exercisable only upon the occurrence of specified events when 
a termination fee would be payable by Frontier to Global Crossing under the     
merger agreement.                                                               

The fee and the stock option could discourage other companies from trying or
proposing to combine with Frontier. The total fees payable to Global Crossing   
under the merger agreement and the profit realizable by Global Crossing under   
the stock option agreement is limited to $275 million. We have attached the     
stock option agreement to this document as Annex B. You should read it in its   
entirety.                                                                       

Regulatory matters (Page 74)                                                    

 The completion of the merger is subject to regulatory requirements, including
expiration or termination of the waiting period under the Hart-Scott-Rodino     
Act, which was terminated on May 11, 1999. The completion of the merger is also 
subject to obtaining required regulatory approvals from the FCC and some state  
public utilities commissions.                                                   

Accounting treatment (Page 74)                                                  

The merger will be accounted for using the purchase method of accounting.   

No appraisal rights (Page 75)                                                   

Under the New York Business Corporation Law, Frontier shareholders are not  
entitled to appraisal rights in connection with the merger. Under Bermuda law,  
Global Crossing shareholders are not entitled to appraisal rights in connection 
with the merger.                                                                

Trading of Global Crossing common stock (Page 75)                               

Global Crossing's common stock is currently trading on the Nasdaq National  
Market and the Bermuda Stock Exchange. The shares of Global Crossing common     
stock to be issued in the merger will also trade on the Nasdaq National Market  
and the Bermuda Stock Exchange.                                                 

Transactions with Qwest and U S WEST                                            

On May 16, 1999, Global Crossing entered into a merger agreement with U S   
WEST. As part of its agreement with Global Crossing, on June 18, 1999, U S WEST 
completed a tender offer pursuant to which U S WEST purchased 39,259,305 shares 
of Global Crossing common stock for $62.75 in cash per share. U S WEST agreed   
to vote the shares that it purchased in the tender offer in favor of the pro-   
posals relating to the Global Crossing--Frontier merger.                        

 On June 13, 1999, Qwest Communications International Inc. announced proposals
to acquire all the outstanding stock of Frontier and U S WEST, which proposals  
were revised on June 23, 1999.                                                  

On July 18, 1999,                                                           

 .  the U S WEST board of directors approved Qwest's acquisition proposal, and U
S WEST entered into a merger agreement with Qwest,                        

.  Global Crossing and U S WEST agreed to terminate their merger agreement. As
  a result, U S WEST paid Global Crossing $140 million in cash and returned to
Global Crossing 2,231,076 shares of Global Crossing common                

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stock that U S WEST had acquired for a total of $140 million in its tender
offer for Global Crossing common stock,                                   

.  Qwest committed to purchase capacity on the Global Crossing network at     
established market rate prices for delivery over the next four years and  
committed to make purchase price payments to Global Crossing for this     
capacity of $140 million over the next two years, and                     

.  Qwest withdrew its proposal to acquire all the outstanding stock of        
Frontier.                                                                 

U S WEST remains bound by its agreement to vote the remaining shares of     
Global Crossing common stock it purchased in the tender offer in favor of the   
proposals relating to the Global Crossing--Frontier merger.                     

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Selected historical financial information 

Selected historical financial information for Global Crossing, Global Marine
and Frontier have been provided in the following tables. This selected          
historical financial information has been derived from the audited and          
unaudited financial statements of Global Crossing, Global Marine and Frontier   
for the periods presented. This information is only a summary and should be     
read together with the more detailed historical financial information included  
or incorporated by reference in this document. You can find financial           
information included in this document beginning on page F-1. For instructions   
on how to obtain information incorporated by reference, see "Where You Can Find 
More Information" on page 171.                                                  

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, 1998 and for the six months ended June 30, 1999 and 1998. The consolidated  
income statement data below for each of the fiscal years in the period from     
inception, March 19, 1997, to December 31, 1998 and the consolidated balance    
sheet data as of December 31, 1998 and 1997 have been derived from financial    
statements audited by Arthur Andersen & Co., independent public accountants,    
which are included in this document beginning on page F-10. We derived the      
remaining data from unaudited condensed consolidated financial statements,      
which are included in this document beginning on page F-1.                      

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

.  During the six-month period ended June 30, 1999, Global Crossing         
 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 year ended December 31, 1998, Global Crossing recognized $37  
  million from a total of $94 million 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. The remaining $57 
 million will be recognized as follows: $28 million in 1999, $21 million
 in 2000 and $8 million in 2001. See the "Stock related expense" item in
the Statement of Operations Data.                                     

.  The "Termination of advisory services agreement" item in the Statement   
  of Operations Data includes a charge for the termination of the advisory
services agreement as of June 30, 1998. See "Some Global Crossing     
Transactions" on page 166. Global Crossing 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
Global Crossing under a related advance agreement. As a result of this
transaction, Global Crossing recorded a non-recurring charge in the   
approximate amount of $138 million during the year ended December 31, 
1998. In addition, Global Crossing recognized as an expense           
 approximately $2 million of advisory fees incurred prior to termination
of the contract.                                                      

.  The "Provision for income taxes" item in the Statement of Operations     
Data reflects income taxes on profits earned during the periods       
  presented in jurisdictions where Global Crossing has a taxable presence.
A significant portion of Global Crossing's operating losses have been 
incurred in non-taxable jurisdictions, and, therefore, these operating
losses cannot be applied to offset Global Crossing's future taxable   
earnings.                                                             

.  On May 18, 1998, a portion of the proceeds from the issuance of the 9    
 5/8% Senior Notes due 2008 of Global Crossing Holdings Ltd. was used to
 repurchase the 12% Senior Notes Due 2004 of Global Telesystems Holdings
Ltd. Global Crossing recognized an extraordinary loss of approximately
$20                                                                   

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million in connection with this repurchase, comprised of a repurchase 
 premium of approximately $10 million and the write-off of approximately
$10 million of unamortized deferred financing costs. See the          
  "Extraordinary loss on retirement of senior notes" item in the Statement
of Operations Data.                                                   

.  The preferred stock dividends for the year ended December 31, 1998       
include dividends from both the 10 1/2% Senior Exchangeable Preferred 
  Stock due 2008 of Global Crossing Holdings and the 14% Senior Increasing
Rate Redeemable Exchangeable Preferred Stock of Global Telesystems    
Holdings. The Global Crossing Holdings preferred stock is mandatorily 
redeemable on December 1, 2008 and exchangeable at any time by Global 
Crossing Holdings into notes. The Global Crossing Holdings preferred  
stock entitles the holders to receive cumulative compounding dividends
  at an annual rate of 10 1/2%. The dividends can be paid in cash or prior
  to June 1, 2002 with the issuance of additional Global Crossing Holdings
preferred stock at the option of Global Crossing Holdings.            

The holders of the Global Telesystems Holdings preferred stock were   
entitled to receive cumulative, compounding dividends at an initial   
annual rate of 14%. Preferred stock dividends include cumulative 14%  
dividends and amortization of the discount and issuance costs. Global 
  Crossing used proceeds from the Global Crossing Holdings Senior Notes to
redeem all outstanding Global Telesystems Holdings preferred stock    
  effective as of June 17, 1998. All dividends prior to the redemption had
  been paid through the issuance of additional preferred stock and charged
 against additional paid-in capital. See the "Preferred stock dividends"
item in the Statement of Operations Data.                             

.  As a result of the redemption of the Global Telesystems Holdings         
 preferred stock, Global Crossing incurred a one-time $34 million charge
against additional paid-in capital. The charge consisted of: (1) a $16
  million charge for redemption premium and (2) a write-off of $18 million
of unamortized discount and unamortized deferred financing costs. See 
 the "Redemption of preferred stock" item in the Statement of Operations
Data.                                                                 

.  Construction in progress and capacity available for sale includes direct 
and indirect expenditures for construction of the Atlantic Crossing   
system and other systems and is stated at cost. Included are costs    
 incurred under (1) the construction contracts; (2) advisory, consulting
and legal fees; (3) interest, including amortization of debt issuance 
costs incurred during the construction phase; and (4) other costs     
  necessary for developing the Atlantic Crossing system and other systems.
  Additionally, Global Crossing 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 allocated
to "Construction in progress" in the amount of $112 million and as    
"Investment in affiliates" in the amount of $163 million. See the     
"Construction in progress, property, plant and equipment and capacity 
available for sale" item in the Balance Sheet Data.                   

.  The "Investment in affiliates" item in the Balance Sheet Data includes   
$163 million as of December 31, 1998, representing the value of the   
warrants described in the bullet point immediately above applicable to
the Pacific Crossing system.                                          

.  The December 31, 1998 amount in the "Mandatorily redeemable preferred    
stock" item in the Balance Sheet Data includes (1) $500 million of    
Global Crossing Holdings preferred stock, less (2) $17 million        
reflecting the unamortized issue costs, plus (3) $4 million of accrued
  dividends. The December 31, 1997 amount includes (1) $100 million of the
 Global Telesystems Holdings preferred stock originally issued, plus (2)
$10 million of Global Telesystems Holdings preferred stock issued as  
  dividends on the originally issued Global Telesystems Holdings preferred
stock, less (3) $19 million reflecting the unamortized discount and   
issue costs, plus $1 million of accrued dividends. Global Crossing    
redeemed all outstanding Global Telesystems Holdings preferred stock  
effective as of June 17, 1998.                                        

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                                                                             Period from      
                           For the Six   For the Six       For the          March 19, 1997    
                          Months Ended  Months Ended     Year Ended     (Date of Inception) to
                          June 30, 1999 June 30, 1998 December 31, 1998   December 31, 1997   
                          ------------- ------------- ----------------- ----------------------
                           (unaudited)   (unaudited)                                          
                                 (in thousands, except share and per share information)       
                                                                                              
Statement of Operations                                                                       
 Data:                                                                                        
Revenues................   $   368,461   $   101,256     $   424,099         $       --       
                           -----------   -----------     -----------         -----------      
Expenses:                                                                                     
Cost of capacity sold...       150,292        41,200         178,492                 --       
Operations,                                                                                   
 administration and                                                                           
 maintenance............        25,869         2,470          18,056                 --       
General and                                                                                   
 administrative.........        44,503         8,850          26,844               1,657      
Sales and marketing.....        23,256         7,313          26,194               1,366      
Network development.....         9,753         4,314          10,962                  78      
Stock related expense...        26,074        23,398          39,374                 --       
Depreciation and                                                                              
 amortization...........         4,200           473             --                  --       
Provision for doubtful                                                                        
 accounts...............         3,683         1,012           4,233                 --       
Termination of advisory                                                                       
 services agreement.....           --        139,669         139,669                 --       
                           -----------   -----------     -----------         -----------      
                               287,630       228,699         443,824               3,101      
                           -----------   -----------     -----------         -----------      
Operating income                                                                              
 (loss).................        80,831      (127,443)        (19,725)             (3,101)     
Equity in loss of                                                                             
 affiliates.............        (5,542)          --           (2,508)                --       
Other income (expense):                                                                       
 Interest income........        31,666         4,422          29,986               2,941      
 Interest expense.......       (46,454)       (7,426)        (42,880)                --       
 Other expense, net.....        (7,683)          --              --                  --       
Provision for income                                                                          
 taxes..................       (30,038)       (9,000)        (33,067)                --       
                           -----------   -----------     -----------         -----------      
Income (loss) before                                                                          
 extraordinary item and                                                                       
 cumulative effect of                                                                         
 change in accounting                                                                         
 principle..............        22,780      (139,447)        (68,194)               (160)     
Extraordinary loss on                                                                         
 retirement of senior                                                                         
 notes..................           --        (19,709)        (19,709)                --       
Cumulative effect of                                                                          
 change in accounting                                                                         
 principle..............       (14,710)          --              --                  --       
                           -----------   -----------     -----------         -----------      
Net income (loss).......         8,070      (159,156)        (87,903)               (160)     
Preferred stock                                                                               
 dividends..............       (27,241)       (8,306)        (12,681)            (12,690)     
Redemption of preferred                                                                       
 stock..................           --        (34,140)        (34,140)                --       
                           -----------   -----------     -----------         -----------      
Net loss applicable to                                                                        
 common shareholders....   $   (19,171)  $  (201,602)    $  (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......   $     (0.01)  $     (0.55)    $     (0.32)        $     (0.04)     
                           ===========   ===========     ===========         ===========      
Extraordinary item                                                                            
 Basic and Diluted......   $       --    $     (0.06)    $     (0.06)        $       --       
                           ===========   ===========     ===========         ===========      
Cumulative effect of                                                                          
 change in accounting                                                                         
 principle                                                                                    
 Basic and Diluted......   $     (0.04)  $       --      $       --          $       --       
                           ===========   ===========     ===========         ===========      
Net loss applicable to                                                                        
 common shareholders                                                                          
 Basic and Diluted......   $     (0.05)  $     (0.61)    $     (0.38)        $     (0.04)     
                           ===========   ===========     ===========         ===========      
Shares used in computing                                                                      
 basic and diluted loss                                                                       
 per share..............                                                                      
Basic and Diluted.......   412,000,658   332,125,394     358,735,340         325,773,934      
                           ===========   ===========     ===========         ===========      

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                                                              December 31,      
                                              June 30,    --------------------- 
                                                1999         1998       1997    
                                             -----------  ----------  --------- 
                                             (unaudited)                        
                                                      (in thousands)            
                                                                                
Balance Sheet Data:                                                             
Current assets including cash and                                               
 investments and restricted cash and                                            
 investments................................ $  905,469   $  976,615  $  27,744 
Long term restricted cash and investments...    367,387      367,600        --  
Long term accounts receivable...............     63,128       43,315        --  
Construction in progress, property, plant                                       
 and equipment and capacity available for                                       
 sale.......................................  1,406,170    1,008,556    518,519 
Investment in affiliates....................    184,676      177,334        --  
Other assets................................    111,767       65,757     25,934 
                                             ----------   ----------  --------- 
 Total assets............................... $3,038,597   $2,639,177  $ 572,197 
                                             ==========   ==========  ========= 
Current liabilities......................... $  302,082   $  256,265  $  90,817 
Long term debt..............................    559,707      269,598    162,325 
Senior notes................................    796,682      796,495    150,000 
Deferred revenue............................     60,140       25,325        --  
Obligations under inland service agreements                                     
 and capital leases.........................     15,237       24,520      3,009 
Deferred income taxes.......................     24,167        9,654        --  
                                             ----------   ----------  --------- 
 Total liabilities..........................  1,758,015    1,381,857    406,151 
Mandatorily redeemable preferred stock......    484,958      483,000     91,925 
Shareholders' equity........................                                    
 Common stock...............................      4,361        4,328      3,258 
 Treasury stock.............................   (209,415)    (209,415)       --  
 Other shareholders' equity.................  1,080,671    1,067,470     71,023 
 Accumulated deficit........................    (79,993)     (88,063)      (160)
                                             ----------   ----------  --------- 
Total shareholders' equity..................    795,624      774,320     74,121 
                                             ----------   ----------  --------- 
Total liabilities and shareholders' equity.. $3,038,597   $2,639,177  $ 572,197 
                                             ==========   ==========  ========= 

Global Marine selected historical financial information                         

The table below shows selected historical financial information for Global  
Marine. This information has been prepared using the combined financial         
statements of Global Marine as of the dates indicated and for the three months  
ended June 30, 1999 and each of the fiscal years in the five-year period ended  
March 31, 1999 and for the three months ended June 30, 1999 and 1998. 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 financial statements audited by KPMG Audit Plc, chartered     
accountants, which are included in this document beginning on page F-52. The    
combined income statement data below for each of the two fiscal years ended     
March 31, 1996 and the combined balance sheet data of March 31, 1996 and 1995   
were derived from management accounts. We derived the remaining data from       
unaudited combined financial statements, which are included in this document    
beginning on page F-45.                                                         

The unaudited translations of Global Marine's sterling amounts into U.S.    
dollars have been translated using convenience translation rates. 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 U.S. dollars at this rate or any other rate of exchange.         

                                                        [Enlarge/Download Table]

                         For the Three For the Three         For the Years Ended March 31,         
                         Months Ended  Months Ended  ----------------------------------------------
                         June 30, 1999 June 30, 1998   1999     1998     1997     1996      1995   
                         ------------- ------------- -------- -------- -------- --------- ---------
                                                         (in thousands)                            
                                                                                                   
Operating revenues......   $ 78,004       $52,315    $347,335 $280,705 $288,813 $ 231,614 $ 127,725
Income from continuing                                                                             
 operations.............      8,448       $ 6,665      47,051   22,730   30,140    42,134    17,337
Total assets............    712,124                   753,333  740,181  614,345   548,419   380,502
Long term obligations...   $270,229                  $261,923 $331,742 $263,420 $ 225,702 $  88,718

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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 ending December 31, 1998 and for the six months ended June 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, which are incorporated by  
reference in this document. We derived the remaining data from unaudited        
consolidated financial statements, which are 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 171.               

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.                                                    

.  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:                                  

.  In the first quarter of 1999, Frontier recorded a $7.5 million charge,   
 or $0.04 per diluted share, for costs related to the merger with Global
 Crossing. These charges primarily include investment banker fees, legal
fees 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, 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.                                                              

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.  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.                             

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                           Six Months    Six Months                  Year Ended December 31,                     
                              Ended         Ended     ---------------------------------------------------------- 
                          June 30, 1999 June 30, 1998    1998        1997        1996        1995        1994    
                          ------------- ------------- ----------  ----------  ----------  ----------  ---------- 
                                  (unaudited)                                                                    
                                            (in thousands, except per share  information)                        
                                                                                                                 
Consolidated Statements                                                                                          
 of Income:                                                                                                      
Revenues................   $1,321,597    $1,280,314   $2,593,558  $2,374,809  $2,588,519  $2,150,328  $1,667,545 
Costs and expenses......    1,174,055     1,131,465    2,276,162   2,288,651   2,220,296   1,865,492   1,341,919 
Operating income........      147,542       148,849      317,396      86,158     368,223     284,836     325,626 
Interest expense........       29,850        25,989       55,318      48,239      43,312      53,572      50,216 
Other income, net of                                                                                             
 other expense..........       14,994        25,470       45,025      38,070      15,850      14,991      20,922 
Income taxes............       55,411        66,753      129,560      44,188     142,556     101,126     109,078 
Income before                                                                                                    
 extraordinary items and                                                                                         
 cumulative effect of                                                                                            
 changes in accounting                                                                                           
 principles.............       77,275        81,577      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.................       77,275        79,822      175,788      31,801     190,187      22,444     180,057 
Dividends on preferred                                                                                           
 stock..................         (506)         (503)      (1,005)     (1,019)     (1,182)     (1,191)     (1,187)
Income applicable to                                                                                             
 common stock...........   $   76,769    $   79,319   $  174,783  $   30,782  $  189,005  $   21,253  $  178,870 
Earnings per common                                                                                              
 share:                                                                                                          
Basic earnings per                                                                                               
 share:                                                                                                          
 Income before                                                                                                   
  extraordinary item and                                                                                         
  cumulative effect of                                                                                           
  changes in accounting                                                                                          
  principles............   $      .45    $      .48   $     1.03  $      .18  $     1.19  $      .94  $     1.26 
 Net income.............          .45           .47         1.02         .18        1.14         .14        1.21 
Diluted earnings per                                                                                             
 share:                                                                                                          
 Income before                                                                                                   
  extraordinary item and                                                                                         
  cumulative effect of                                                                                           
  changes in accounting                                                                                          
  principles............          .43           .47         1.02         .18        1.18         .88        1.16 
 Net income.............          .43           .46         1.01         .18        1.13         .13        1.11 
Cash dividends declared                                                                                          
 per common share.......   $      .10    $      .45   $      .89  $     .875  $     .855  $     .835  $     .815 
Consolidated Balance                                                                                             
 Sheets (at period end):                                                                                         
Current assets..........   $  577,637                 $  566,674  $  490,305  $  477,761  $  524,200  $  673,826 
Property, plant and                                                                                              
 equipment, net.........    2,038,457                  1,677,559   1,046,884     975,982     883,046   1,034,442 
Goodwill and customer                                                                                            
 base, net..............      466,851                    484,015     517,754     538,296     550,081     222,442 
Deferred and other                                                                                               
 assets.................      391,493                    330,495     432,977     237,353     154,088     130,084 
 Total assets...........   $3,474,438                 $3,058,743  $2,487,920  $2,229,392  $2,111,415  $2,060,794 
Current liabilities.....   $  551,229                 $  567,697    $492,978  $  424,397  $  506,073  $  305,698 
Long-term debt..........    1,647,960                  1,350,821     934,681     677,570     618,867     661,549 
Deferred income taxes...       50,462                     40,046      10,927       2,542      15,644      98,217 
Deferred employee                                                                                                
 benefits obligation....       92,049                     81,925      74,965      57,573      58,385      46,001 
Preferred stock.........       18,294                     18,770      20,126      22,611      22,769      22,777 
Shareholders' equity,                                                                                            
 exclusive of preferred                                                                                          
 stock..................    1,114,444                    999,484     954,243   1,044,699     889,677     926,552 
 Total liabilities and                                                                                           
  shareholders' equity..   $3,474,438                 $3,058,743  $2,487,920  $2,229,392  $2,111,415  $2,060,794 

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Selected unaudited pro forma financial information

 The following unaudited pro forma condensed combined financial information of
Global Crossing, Global Marine and Frontier, which we refer to as "Pro Forma    
Global Crossing," has been prepared to demonstrate how these companies or       
businesses might have looked if the merger and merger-related transactions had  
been completed as of the dates or at the beginning of the periods presented.    

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 our long distance    
business and increased opportunities to earn more revenue as a result of        
combining our companies. 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 transactions outlined in this document had taken place earlier or the       
future results that the companies will experience after completion of the       
transactions.                                                                   

 Global Crossing and Frontier estimate that the Global Marine acquisition, the
merger and related transactions will result in fees and expenses totaling       
approximately $95 million.                                                      

These unaudited pro forma condensed combined financial statements should be 
read in conjunction with the historical financial statements of Global          
Crossing, Global Marine and Frontier, which, in the case of Global Crossing and 
Global Marine, are included in this document and, in the case of Frontier, are  
incorporated by reference in this document.                                     

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Pro Forma Global Crossing 

Unaudited Pro Forma Condensed Combined Statement of Operations
(in thousands, except share and per share data) 

                                                                [Download Table]

                                                               Six Months Ended
                                                                June 30, 1999  
                                                               ----------------
                                                                               
Operating revenues............................................   $  1,863,556  
                                                                 ------------  
Operating expenses:                                                            
  Operating, selling, general and administrative..............      1,430,520  
  Stock related expense.......................................         26,074  
  Depreciation and amortization...............................        315,960  
                                                                 ------------  
                                                                    1,772,554  
                                                                 ------------  
Operating income..............................................         91,002  
Equity in income of affiliates................................          8,684  
Other income (expense):                                                        
  Interest expense............................................       (107,173) 
  Interest income.............................................         35,311  
  Other income................................................         (5,367) 
                                                                 ------------  
Income before taxes and cumulative effect of change in                         
 accounting principle.........................................         22,457  
  Provision for income taxes..................................        (87,206) 
                                                                 ------------  
Loss before cumulative effect of change in accounting                          
 principle....................................................        (64,749) 
  Preferred stock dividends...................................        (27,241) 
  Redemption of preferred stock...............................           (183) 
                                                                 ------------  
Loss applicable to common shareholders before cumulative                       
 effect of change in accounting principle (Basic and                           
 Diluted).....................................................   $    (92,173) 
                                                                 ============  
Loss per common share:                                                         
  Loss applicable to common shareholders before cumulative                     
   effect of change in accounting principle                                    
    Basic and Diluted.........................................   $      (0.13) 
                                                                 ============  
  Shares used in computing information applicable to common                    
   shareholders                                                                
    Basic and Diluted.........................................    684,883,385  
                                                                 ============  

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Pro Forma Global Crossing 

Unaudited Pro Forma Condensed Combined Statement of Operations
(in thousands, except share and per share data) 

                                                                [Download Table]

                                                               Fiscal Year 1998
                                                               ----------------
                                                                               
Operating revenues...........................................    $  3,364,992  
                                                                 ------------  
Operating expenses:                                                            
  Operating, selling, general and administrative.............       2,548,346  
  Termination of Advisory Services Agreement.................         139,669  
  Stock related expense......................................          39,374  
  Depreciation and amortization..............................         603,001  
                                                                 ------------  
                                                                    3,330,390  
                                                                 ------------  
Operating income.............................................          34,602  
Equity in income of affiliates...............................          18,935  
Other income (expense):                                                        
  Interest expense...........................................        (157,374) 
  Interest income............................................          38,863  
  Other income...............................................          23,230  
                                                                 ------------  
Income before taxes, extraordinary item, and cumulative                        
 effect of change in accounting principle....................         (41,744) 
  Provision for income taxes.................................        (168,064) 
                                                                 ------------  
Loss before extraordinary item and cumulative effect of                        
 change in accounting principle..............................        (209,808) 
  Preferred stock dividends..................................         (12,681) 
  Redemption of preferred stock..............................         (34,323) 
                                                                 ------------  
Loss applicable to common shareholders before extraordinary                    
 item and cumulative effect of change in accounting principle                  
 (Basic and Diluted).........................................    $   (256,812) 
                                                                 ============  
Loss per common share:                                                         
  Loss applicable to common shareholders before extraordinary                  
   item and cumulative effect of change in accounting                          
   principle                                                                   
    Basic and Diluted........................................    $      (0.41) 
                                                                 ============  
  Shares used in computing information applicable to common                    
   shareholders                                                                
    Basic and Diluted........................................     631,618,067  
                                                                 ============  

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Pro Forma Global Crossing 

Unaudited Pro Forma Condensed Combined Balance Sheet
(in thousands)

                                                                [Download Table]

                                                                       June     
                                                                     30, 1999   
                                                                    ----------- 
                                                                                
Cash and cash equivalents.......................................... $   318,918 
Other current assets...............................................     779,923 
                                                                    ----------- 
  Total current assets.............................................   1,098,841 
Restricted cash and cash equivalents...............................     367,387 
Accounts receivable................................................      63,128 
Capacity available for sale........................................     503,878 
Property, plant and equipment, net.................................   2,460,451 
Construction in process............................................     842,439 
Goodwill and other intangibles, net................................  11,480,897 
Other assets, net..................................................     503,260 
Investment in affiliates...........................................     225,033 
                                                                    ----------- 
  Total assets..................................................... $17,545,314 
                                                                    =========== 
Current liabilities................................................ $ 1,153,225 
Long term debt.....................................................   2,790,906 
Senior notes.......................................................     796,682 
Deferred income taxes..............................................    (121,632)
Postretirement and other post-employment benefit obligations.......      92,049 
Deferred credits and other.........................................     191,926 
                                                                    ----------- 
  Total liabilities................................................   4,903,156 
                                                                    ----------- 
Mandatorily redeemable preferred stock.............................     484,958 
                                                                    ----------- 
Shareholders' equity                                                            
  Preferred stock..................................................         --  
  Common stock.....................................................       7,090 
  Other shareholders' equity.......................................  12,513,663 
  Unearned compensation............................................     (74,145)
  Treasury stock...................................................    (209,415)
  Accumulated deficit..............................................     (79,993)
                                                                    ----------- 
Total shareholders' equity.........................................  12,157,200 
                                                                    ----------- 
  Total liabilities and shareholders' equity....................... $17,545,314 
                                                                    =========== 

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Comparative per share data                                                      

Presented below is the income/loss from operations before extraordinary item
and cumulative effect of changes in accounting principle, book value per common 
share and cash dividends per common share data for Global Crossing and Frontier 
on an historical basis and a pro forma basis. We combined historical            
consolidated financial information of Global Crossing, Global Marine and        
Frontier using the purchase method of accounting for business combinations. See 
"Unaudited Pro Forma Condensed Combined Financial Statements" beginning on page 
92.                                                                             

The unaudited Frontier equivalent pro forma information was calculated by   
multiplying the corresponding unaudited Pro Forma Global Crossing consolidated  
data by an assumed exchange ratio of 1.5750, which is the exchange ratio if the 
average trading price of Global Crossing common stock during the measurement    
period is $40.00, the closing price of Global Crossing common stock on August   
2, 1999. This information shows how each share of Frontier common stock would   
have participated in net earnings and book value of Global Crossing if the      
merger had been completed at January 1, 1998. These amounts, however, do not    
necessarily reflect future per share levels of net earnings or book value of    
Global Crossing.                                                                

                                                                [Download Table]

                                                                      Six months
                                                              Fiscal    ended   
                                                               Year    June 30, 
                                                               1998      1999   
                                                              ------  ----------
                                                                                
Global Crossing historical                                                      
Loss per share:                                                                 
  Basic...................................................... $(0.32)   $(0.05) 
  Diluted....................................................  (0.32)    (0.58) 
Book value per common share..................................   1.89      1.82  
Cash dividends declared per common share.....................    --        --   

Frontier historical                                                             
Earnings per share:                                                             
  Basic......................................................   1.03      0.45  
  Diluted....................................................   1.02      0.43  
Book value per common share..................................   5.93      6.54  
Cash dividends declared per common share.....................   0.89      0.10  

Unaudited Global Crossing equivalent pro forma                                  
Loss per share:                                                                 
  Basic......................................................  (0.41)    (0.13) 
  Diluted....................................................  (0.41)    (0.13) 
Book value per common share..................................      *     17.70  

Unaudited Frontier equivalent pro forma                                         
Earnings per share:                                                             
  Basic......................................................  (0.65)    (0.20) 
  Diluted....................................................  (0.65)    (0.20) 
Book value per common share..................................      *     27.88  

--------                                                                        
* Information not provided                                                      

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Market prices and dividends                                                     

The Global Crossing common stock trades on both the Nasdaq National Market  
and the Bermuda Stock Exchange under the symbol "GBLX." Frontier common stock   
is listed on the New York Stock Exchange under the symbol "FRO."                

 The table below shows, for the calendar quarters indicated, the reported high
and low sale prices of Global Crossing common stock as reported on the Nasdaq   
National Market and the Frontier common stock as reported on the New York Stock 
Exchange Composite Transactions Tape, in each case based on published financial 
sources and the dividends, if any, declared on the stock. Share amounts and     
values for Global Crossing common stock 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 for Global Crossing covers the period between August   
14, the date of the initial public offering of the Global Crossing common       
stock, through September 30.                                                    

                                                                [Download Table]

                         Global Crossing Common Stock      Frontier Common Stock 
                         --------------------------------------------------------
                           Market Price          Cash     Market Price    Cash   
                         --------------------  Dividends  ------------- Dividends
                           High       Low      Declared    High   Low   Declared 
                         ---------- --------- ------------------ ------ ---------
                                                                                 
Calendar 1997                                                                    
 First Quarter..........        --        --         --   $23.25 $17.75  $.2175  
 Second Quarter.........        --        --         --    20.50  15.38   .2175  
 Third Quarter..........        --        --         --    24.19  19.00   .2175  
 Fourth Quarter.........        --        --         --    25.00  20.00   .2225  
Calendar 1998                                                                    
 First Quarter..........        --        --         --    33.44  24.44   .2225  
 Second Quarter.........        --        --         --    33.00  28.31   .2225  
 Third Quarter.......... $    12.75 $    8.00        --    36.75  24.13   .2225  
 Fourth Quarter.........      23.50      8.63        --    34.13  24.81   .2225  
Calendar 1999                                                                    
 First Quarter..........      62.63     18.94        --    54.94  33.19   .0500  
 Second Quarter.........      64.25     39.63        --    60.38  49.13   .0500  
 Third Quarter (through                                                          
  August 4, 1999).......      50.00     32.94        --    59.94  43.63     --   

Since the date of the merger agreement, the Global Crossing common stock has
traded within a range from $32.94 to $64.25. The average trading price for      
purposes of determining the exchange ratio will be based on the trading prices  
of the Global Crossing common stock during the measurement period shortly       
before the closing, which measurement period may end after the date of the      
Frontier special meeting.                                                       

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The following table presents trading information for the Global Crossing    
common stock and Frontier common stock on March 16, 1999 and August 4, 1999.    
March 16, 1999 was the last full trading day before our announcement of the     
signing of the merger agreement. August 4, 1999 was the last practicable        
trading day for which information was available before the date of this         
document. The equivalent pro forma price of Frontier common stock is also       
presented below for each price. The equivalent pro forma price for each date    
was determined by multiplying the applicable price of Global Crossing common    
stock by the exchange ratio that would result if the applicable price of Global 
Crossing common stock shown were the average trading price of Global Crossing   
common stock during the measurement period. We cannot assure you what the       
market prices of the Global Crossing common stock will be at the merger date or 
during the period when the exchange ratio is calculated. You should obtain      
current market quotations.                                                      

                                                                [Download Table]

                                                                    Frontier   
                                    Global Crossing   Frontier   Equivalent Pro
                                     Common Stock   Common Stock     Forma     
                                    --------------- ------------ --------------
                                                                               
Closing price on March 16, 1999....      $ 51 1/2       $44 5/8       $63      
Closing price on August 4, 1999....      $  36          $47 3/8       $63      

 Global Crossing does not anticipate paying cash dividends on its common stock
in the foreseeable future. The terms of some debt instruments of Global         
Crossing limit its ability to pay cash dividends. Future cash dividends, if     
any, will be at the discretion of the Global Crossing board of directors and    
will depend upon, among other things, Global Crossing's operations, capital     
requirements and surplus, general financial condition, contractual restrictions 
and those other factors the Global Crossing board of directors may deem         
relevant. See "Global Crossing's Management Discussion and Analysis of          
Financial Condition and Results of Operations" beginning on page 116.           

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Risk Factors

Shareholders of Global Crossing and Frontier should consider the following  
factors, in addition to the other information contained in this document.       

Risks Relating to the Merger                                                    

The successful integration of Frontier's business and the achievement of        
expected benefits cannot be assured                                             

 We expect that the merger will result in benefits arising out of the creation
of a seamless global network of telecommunications facilities and services.     
Even though Global Crossing and Frontier have little direct overlap of          
employees, markets, customers, products or facilities, we also expect the       
merger to result in some operating efficiencies and cost savings related to the 
transport of communications and information over long distances. Achieving the  
benefits of the merger will depend in part upon the integration of the          
businesses of Global Crossing and Frontier in an efficient manner. We cannot    
assure you that this will happen or that it will happen in a timely manner.     
Global Crossing has not previously had significant experience integrating the   
operations of acquired companies. The consolidation of operations will 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 revenues, 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 the merger.    

Since the market price of the Global Crossing common stock will vary, Frontier  
shareholders cannot be sure of the value of the Global Crossing common stock to 
be received in the merger                                                       

Since the date of the merger agreement, the Global Crossing common stock has
traded within a range from $32.94 to $64.25. The average trading price for      
purposes of determining the exchange ratio will be based on the trading prices  
of the Global Crossing common stock during the measurement period shortly       
before the closing, which measurement period may end after the date of the      
Frontier special meeting.                                                       

If the average trading price of the Global Crossing common stock during the 
measurement period for determining the exchange ratio is less than $34.5625,    
Frontier shareholders will receive less than $63.00 in value of Global Crossing 
common stock for each share of Frontier common stock in the merger, unless the  
Frontier board of directors chooses to terminate the merger agreement and       
Global Crossing chooses to increase the value of the merger consideration.      
Frontier shareholders will not be able to vote against the merger if the        
trading price of the Global Crossing common stock falls below $34.5625 after    
the Frontier special meeting and the Frontier board of directors will not be    
required to terminate the merger agreement if the average trading price during  
the measurement period is below $34.5625. In addition, the number of shares of  
Global Crossing common stock that Frontier shareholders will receive in the     
merger will not be adjusted for changes in Global Crossing's stock price if the 
average trading price during the measurement period is above $56.7813. As a     
result, the value of the Global Crossing shares received by Frontier            
shareholders in the merger will also vary with fluctuations in the Global       
Crossing stock price above this level.                                          

Also, the exchange ratio is based on an average price of the Global Crossing
common stock during the measurement period shortly before the closing.          
Accordingly, because the market price of Global Crossing common stock will      
fluctuate and may increase or decrease during the period from the end of the    
measurement period to the effective time of the merger, and from the effective  
time until Global Crossing delivers certificates representing Global Crossing   
shares to Frontier shareholders, the value of the Global Crossing common stock  
actually received by Frontier shareholders may be more or less than the average 
trading price or the value of the Global Crossing common stock at the effective 
time of the merger.                                                             

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Because the closing of the merger may happen at a date later than the       
shareholder meetings, we cannot assure you that the price of the Global         
Crossing common stock on the date of the meetings will be indicative of its     
price at the closing of the merger.                                             

Risks relating to the business and operations of Global Crossing                

Global Crossing has a limited operating history                                 

Global Crossing was organized in March 1997 and has a limited operating     
history. Global Crossing's financial information relates principally to a       
period in which it was constructing and developing the Atlantic Crossing system 
and, until May 1998, had minimal revenues and operating costs. Despite          
recognizing approximately $793 million in revenues, Global Crossing has         
incurred a net loss applicable to common shareholders of approximately $167     
million for the period from March 19, 1997, its date of inception, through June 
30, 1999, due primarily to the termination of some advisory services            
agreements, the incurrence of stock-related expense, the extraordinary loss on  
the retirement of some senior notes, preferred stock dividends and the          
redemption of some preferred stock. Global Crossing has financed its net        
losses, debt service, capital expenditures and other cash needs to date through 
operations, the proceeds of sales of common stock and mandatorily redeemable    
preferred stock and the issuance of debt. Global Crossing will require          
substantial additional capital in order to carry out its business plan.         

Global Crossing's significant indebtedness could adversely affect it by leaving 
it with insufficient cash to fund operations and impairing its ability to       
obtain additional financing                                                     

The amount of Global Crossing's debt could have important consequences for  
its future, including, among other things:                                      

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

.  payments of principal and interest on borrowings may leave it with       
insufficient cash resources for its operations, and                   

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

Global Crossing has incurred a high level of debt. As of June 30, 1999,     
Global Crossing and its consolidated subsidiaries had a total of $1,758 million 
of total liabilities, including approximately $1,384 million in senior          
indebtedness, of which $560 million was secured. Global Crossing's direct       
subsidiary, Global Crossing Holdings, also has mandatorily redeemable preferred 
stock outstanding with a face value of $500 million. In addition, Global        
Crossing's Pacific Crossing joint venture entered into an $850 million non-     
recourse credit facility, under which it had incurred $468 million of           
indebtedness as of June 30, 1999. Global Crossing also incurred additional      
indebtedness of $600 million in connection with its acquisition of Global       
Marine.                                                                         

 Global Crossing's ability to repay its debt depends upon a number of factors,
many of which are beyond its control. In addition, Global Crossing relies on    
dividends, loan repayments and other intercompany cash flows from its           
subsidiaries to repay its obligations. Global Crossing's 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 Global Crossing is unable to generate sufficient cash flow to
meet its debt service requirements, Global Crossing may have to renegotiate the 
terms of its long-term debt. Global Crossing cannot assure you that it would be 
able to successfully renegotiate those terms or refinance its indebtedness when 
required or that satisfactory terms of any refinancing would be available. If   
Global Crossing were not able to refinance its indebtedness or obtain new       
financing under these circumstances, Global Crossing would have to consider     
other options, such as:                                                         

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.  sales of some assets to meet its debt service obligations,               

.  sales of equity,                                                         

.  negotiations with its lenders to restructure applicable indebtedness, or 

.  other options available to it under applicable law.                      

Global Crossing may encounter difficulties in completing its cable systems      

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

.  its ability to manage their construction effectively,                    

.  its ability to obtain all construction and operating permits and         
licenses,                                                             

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

.  its 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
the Global Crossing systems, which could have a material adverse effect on      
Global Crossing's business, financial condition and results of operations.      

Global Crossing cannot assure you that each of its systems will be completed
at the cost and in the time frame currently estimated by Global Crossing, or    
even at all. Although Global Crossing awards contracts for construction of its  
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, Global Crossing cannot       
assure you that the actual construction costs or the time required to complete  
these systems will not exceed its current estimates. These circumstances could  
have a material adverse effect on Global Crossing's results of operations or    
financial condition.                                                            

Global Crossing depends upon the continued success of its sales and marketing   
capabilities                                                                    

Global Crossing's success will depend substantially on sales of capacity on 
its systems. Although Global Crossing's sales and marketing efforts have        
resulted to date in substantial sales of undersea and terrestrial capacity on   
its systems, Global Crossing cannot be certain that it will continue to be      
successful in selling capacity or that it will be able to realize its business  
plan. Furthermore, even if Global Crossing realizes its plan, it still may not  
be able to sustain operating profitability or generate sufficient cash flow to  
service its indebtedness.                                                       

If Global Crossing is unable to effectively sell capacity on its cable      
systems, its results of operations will be materially adversely affected.       
Global Crossing's ability to achieve its business objectives depends in large   
part upon its sales and marketing capabilities. Global Crossing has assembled a 
dedicated sales and marketing force. Global Crossing depends upon the ability   
of these employees to effectively market and sell capacity. We cannot be        
certain that Global Crossing will be able to effectively sell capacity on its   
cable systems.                                                                  

Global Crossing's revenue growth plan depends on product and service expansion  

Global Crossing intends to grow revenues and profits by:                    

.  upgrading capacity on its planned systems,                               

.  developing additional undersea cable projects,                           

.  developing or purchasing additional terrestrial fiber capacity, and      

.  introducing new services.                                                

If Global Crossing is unable to effect these upgrades, develop additional   
cable projects, develop or obtain additional terrestrial capacity or introduce  
new services, its business, financial condition and results of operations could 
be adversely affected.                                                          

Some of Global Crossing's capacity purchase contracts are terminable under      
specified circumstances                                                         

 Under some capacity purchase agreements for the Atlantic Crossing system, the
customer may terminate the agreement if, among other things, Global Crossing    
does not obtain and hold specified governmental authorizations, approvals,      
consents, licenses and permits. Purchase agreements for Global Crossing's other 

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systems may contain similar provisions. If a substantial number of purchase     
agreements are terminated for these or other reasons, Global Crossing's         
business, financial condition and results of operations could be materially     
adversely affected.                                                             

Global Crossing faces competition along its routes                              

The international telecommunications industry is highly competitive. Global 
Crossing faces competition from existing and planned systems along each of its  
planned routes. Global Crossing also competes with satellite providers,         
including existing geosynchronous satellites and low- and medium-earth orbit    
systems now under construction. Global Crossing competes primarily on the basis 
of price, availability, transmission quality and reliability, customer service  
and the location of its systems. Traditionally, carriers have made substantial  
long-term investments in ownership of cable capacity. We cannot assure you that 
Global Crossing will be able to compete successfully against systems to which   
prospective customers have made long-term commitments.                          

Global Crossing's principal shareholders may be able to materially influence    
the outcome of shareholder votes                                                

As of July 29, 1999, Pacific Capital Group had a 21.69% beneficial ownership
interest in Global Crossing. Global Crossing has entered into various           
transactions with Pacific Capital Group and assumed the on-going development of 
some of its systems from an affiliate of Pacific Capital Group. Mr. Gary        
Winnick, co-chairman of the Global Crossing board of directors, controls        
Pacific Capital Group and its subsidiaries. In addition, several of Global      
Crossing's other officers and directors are affiliated with Pacific Capital     
Group. Furthermore, as of July 29, 1999, Canadian Imperial Bank of Commerce had 
a 19.98% beneficial ownership interest in Global Crossing. Canadian Imperial    
Bank of Commerce and its affiliates have acted as underwriter, lender or        
initial purchaser in several of Global Crossing's financial transactions in     
connection with the development and construction of the Global Crossing         
systems. Several members of the Global Crossing board of directors are          
employees of an affiliate of Canadian Imperial Bank of Commerce.                

As of July 29, 1999, Pacific Capital Group and Canadian Imperial Bank of    
Commerce collectively beneficially owned 41.67% of the outstanding Global       
Crossing common stock. Accordingly, Pacific Capital Group and Canadian Imperial 
Bank of Commerce may be able to materially influence the outcome of matters     
submitted to a vote of Global Crossing shareholders, including the election of  
directors.                                                                      

Officers and directors own a substantial portion of Global Crossing and may     
have conflicts of interest                                                      

Global Crossing's executive officers and directors have substantial equity  
interests in Global Crossing. As of July 29, 1999, all of Global Crossing's     
directors and executive officers as a group collectively beneficially owned     
73.25% of the outstanding common stock of Global Crossing, including shares     
beneficially owned by Pacific Capital Group and Canadian Imperial Bank of       
Commerce. Some of these individuals have also received amounts from Global      
Crossing due to advisory services fees paid to Pacific Capital Group and its    
affiliates.                                                                     

Some of Global Crossing's directors and executive officers also serve as    
officers and directors of other companies. Additionally, some of Global         
Crossing's officers and directors are active investors in the                   
telecommunications industry. Service as a director or officer of Global         
Crossing 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 Global Crossing and the other company. A        
conflict of interest could also exist with respect to allocation of time and    
attention of persons who are directors or officers of both Global Crossing and  
another company. The pursuit of these other business interests could distract   
these officers from pursuing opportunities on Global Crossing's behalf. These   
conflicts of interest could have a material adverse effect on Global Crossing's 
financial condition.                                                            

Global Crossing must complete the transition to an operating company            

The transition from a development stage company to an operating company     
places significant demands on Global Crossing's management and operations.      
Global Crossing is in the process of expanding the management and operational   
capabilities necessary for this transition.                                     

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Global Crossing's ability to manage this transition successfully will depend
on, among other things:                                                         

.  expanding, training and managing Global Crossing's employee base,        
  including attracting, retaining and motivating highly skilled personnel,

.  taking over or outsourcing its customer interface and operations,        
administrative and maintenance systems,                               

.  procuring terrestrial capacity to provide connectivity to inland cities, 
and                                                                   

.  controlling expenses.                                                    

We cannot assure you that Global Crossing will succeed in developing all or 
any of these capabilities, and any failure to do so could have a material       
adverse effect on its results of operations.                                    

Global Crossing is growing rapidly in a changing industry                       

 Part of Global Crossing's strategy is to construct several cable systems in a
short time frame in order to take advantage of the supply and demand imbalance  
that currently exists and is projected to exist in the global marketplace.      
Global Crossing expects each of its currently announced systems to be           
operational between now and 2001. As a result of this aggressive strategy,      
Global Crossing is experiencing rapid expansion and expects it to continue for  
the foreseeable future. This growth has increased Global Crossing's 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 globalization of the world's economies, and                          

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

Much of Global Crossing's planned growth is predicated upon the growth in   
demand for international telecommunications capacity. We cannot assure you that 
this anticipated demand growth will occur.                                      

Global Crossing faces pricing uncertainties                                     

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 circuits to go down even further. If there is   
less demand than Global Crossing projects or a bigger drop in prices per        
circuit than it projects, there could be a material adverse effect on its       
business, financial condition and results of operations. We cannot assure you,  
even if Global Crossing's projections with respect to those factors are         
realized, that Global Crossing will be able to implement its strategy or that   
its strategy will be successful in the rapidly evolving telecommunications      
market.                                                                         

Global Crossing confronts several system operational risks                      

Each of the Global Crossing systems will be subject to the risks inherent in
a large-scale, complex fiber optic telecommunications system. The operation,    
administration, maintenance and repair of these 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, even if built to specifications, the Global Crossing systems   
will 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 the Global Crossing systems either has or is expected to have a     
design life of generally 25 years; however, we cannot assure you of the actual  
useful life of any of these systems. A number of factors will affect the useful 
life of each of the Global Crossing systems, including, among other things:     

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.  quality of construction,                                                 

.  unexpected damage or deterioration, and                                  

.  technological or economic obsolescence.                                  

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

Global Crossing depends on its key personnel                                    

Global Crossing's future success depends on the skills, experience and      
efforts of the officers and key technical and sales employees. As some of these 
officers and employees are new, we cannot be certain that Global Crossing will  
be able to integrate new management into its existing operations. In addition,  
competition for these individuals is intense, and Global Crossing may not be    
able to attract, motivate and retain highly skilled qualified personnel. Global 
Crossing does not have "key person" life insurance policies covering any of its 
employees.                                                                      

Global Crossing faces risks associated with international operations            

Because Global Crossing will derive substantial revenues from international 
operations and intends to have substantial physical assets in several           
jurisdictions along the routes of its planned systems, its 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.                        

 Global Crossing has not experienced any material adverse effects with respect
to its 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 Global         
Crossing's ability to manage its overall growth.                                

Global Crossing is subject to government regulation in various jurisdictions    

 Global Crossing will, in the ordinary course of development, construction and
operation of its fiber optic cable systems, be required to obtain and maintain  
various permits, licenses and other authorizations in both the United States    
and in international jurisdictions where its cables land and exist.             

.  Undersea cable landing or similar licenses will be required in many of   
  the jurisdictions where the Global Crossing systems will land and exist.
These licenses are typically issued for a term of years, subject to   
renewal. Moreover, the licenses may subject Global Crossing's business
and operations to varying forms of regulation, which could change over
 time. If Global Crossing fails to obtain or renew a license or if there
is a material change in the nature of the regulation to which Global  
Crossing is subject, there could be a material adverse effect on its  
business, financial condition and results of operations.              

.  Global Crossing must obtain construction and operating licenses during   
the construction phase of each of its cable systems. Although Global  
Crossing intends that the construction contracts for each of its      
undersea cable systems impose the burden of acquiring and maintaining 
construction licenses and permits on the contractor for each of these 
systems, Global Crossing cannot assure you that the contractors will  
 successfully obtain all permits and licenses. If Global Crossing or any
contractor fails to obtain or maintain any construction or operating  
permit or license, there could be a material adverse effect on Global 
Crossing's business, financial condition and results of operations.   

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Global Crossing depends on third parties for many functions                     

Global Crossing depends and will continue to depend upon third parties to:  

.  construct some of its systems and provide equipment and maintenance,     

.  provide access to a number of origination and termination points of the  
Global Crossing systems in various jurisdictions,                     

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

.  acquire rights of way,                                                   

.  provide terrestrial capacity to its customers through contractual        
arrangements, and                                                     

.  act as joint venture participants with regard to some of its 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 Global Crossing's business,         
financial condition and results of operations.                                  

Global Crossing cannot predict its future tax liabilities                       

Global Crossing believes that a significant portion of the income derived   
from its 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 Global Crossing conducts activities or in which customers of 
Global Crossing are located. However, Global Crossing bases this belief upon    

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

.  its understanding of its position under the tax laws of the various      
 countries in which it has assets or conducts 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 Global Crossing may become     
subject and cannot be certain that any of these factors would not have a        
material adverse effect on its business, financial condition and results of     
operations.                                                                     

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

Global Crossing believes that neither it nor any of its non-United States   
subsidiaries is a foreign personal holding company and does not expect that     
either it or any of its affiliates will become a foreign personal holding       
company. However, we cannot assure you in this regard. If a shareholder of      
Global Crossing is a United States person and Global Crossing or one of its     
non-United States subsidiaries is classified as a foreign personal holding      
company, then that shareholder would be required to pay tax on its pro rata     
share of Global Crossing's or its relevant non-United States subsidiary's       
undistributed foreign personal holding company income. Global Crossing intends  
to manage its 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 its affairs would be consistent with its business goals.          

Global Crossing believes that it is not a passive foreign investment company
and does not expect to become a passive foreign investment company in the       
future. However, we cannot assure you in this regard. In addition, this belief  
is based, in part, on interpretations of existing law that Global Crossing      
believes are reasonable, but which have not been approved by any taxing         
authority. If Global Crossing were a passive foreign investment company, then a 
shareholder of Global Crossing 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 Global Crossing or when that shareholder sold 
the Global Crossing capital stock at a gain.                                    

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

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Global Crossing does not plan on paying dividends                               

 Global Crossing does not anticipate paying cash dividends on its common stock
in the foreseeable future. Global Crossing's ability to pay dividends is        
limited by some of its debt instruments. See "Management's Discussion and       
Analysis of Financial Condition and Results of Operations--Liquidity and        
capital resources."                                                             

Large Global Crossing shareholders face voting and transfer restrictions        

Global Crossing's bye-laws provide that each share of Global Crossing common
stock will have one vote. However, if the shares controlled by any person       
constitute more than 9.5% (or, in the case of Canadian Imperial Bank of         
Commerce and its affiliates, more than 35%) of the voting power of the          
outstanding shares, the voting rights of that shareholder's shares will be      
limited to 9.5% (or 35% in the case of Canadian Imperial Bank of Commerce and   
its affiliates) of the voting power of the outstanding shares and the           
additional votes of those shares will be allocated to the other holders of      
common stock on a pro rata basis. The other holders who were allocated these    
additional votes may not exceed the above limitation as a result of this        
allocation.                                                                     

The bye-laws also prohibit any transfer of shares of common stock that,     
subject to specified exceptions, would result in a natural person beneficially  
owning shares in excess of 5% of the outstanding shares of common stock or a    
group of persons or any person other than a natural person beneficially owning  
shares in excess of 9.5% of the outstanding shares of common stock, without the 
approval of a majority of the members of the board of directors and             
shareholders holding at least 75% of the votes of all outstanding shares of     
Global Crossing common stock. These voting and transfer restrictions could make 
it difficult for any person or group of persons acting in concert (other than   
specified existing shareholders) to acquire a substantial ownership position    
in, or control of, Global Crossing.                                             

 If the proposed bye-law amendments are adopted at the 1999 annual shareholder
meeting of Global Crossing,                                                     

.  the voting power of any 9.5% or larger shareholder will be limited to    
  9.5% of the total votes cast at a shareholder meeting in connection with
any matter being voted on (with reallocation of this voting power as  
specified above),                                                     

.  the voting power of Canadian Imperial Bank of Commerce and its           
affiliates will be limited to 20% of the total votes cast at a        
shareholder meeting in connection with any matter being voted on (with
reallocation of this voting power as specified above) and             

.  any transfer of shares of Global Crossing common stock that, subject to  
 specified exceptions, would result in a shareholder beneficially owning
5% or more, if the shareholder is a natural person, or 9.5% or more,  
otherwise, of the outstanding shares of Global Crossing common stock  
will need to be approved by at least a majority of the directors and a
majority of the total votes cast at the shareholder meeting called to 
approve that transfer.                                                

Global Crossing's stock performance may be volatile                             

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

.  quarterly variations in operating results,                               

.  competition,                                                             

.  announcements of technological innovations or new products by Global     
Crossing or its competitors,                                          

.  product enhancements by Global Crossing or its 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 Global Crossing's  
common stock.                                                                   

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Cautionary Statement Regarding Forward-Looking Statements 

Global Crossing and Frontier have included forward-looking statements       
throughout this document. These statements describe their attempt to predict    
future occurrences. Global Crossing and Frontier use the words "believe,"       
"anticipate," "expect," "intend" and similar expressions to identify forward-   
looking statements. These statements also include references to cost savings,   
benefits, revenues and earnings estimated to result from the merger and         
estimated costs of combining Global Crossing and Frontier. Forward-looking      
statements are subject to a number of risks, assumptions and uncertainties. For 
Global Crossing and Frontier, these risks, assumptions and uncertainties, which 
may cause actual results to differ materially from those predicted by the       
forward-looking statements, include:                                            

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

.  the ability to sell capacity on systems,                                 

.  the successful transition of Global Crossing from a system development   
company to an operating company,                                      

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

.  international, national and local general economic and market            
conditions,                                                           

.  the size and growth of the overall telecommunications market,            

.  new product and service development and introduction,                    

.  changes in consumer preferences,                                         

.  existing governmental regulations and changes in the nature of           
 telecommunications regulation in the United States and other countries,

.  the loss of significant customers, employees or suppliers,               

.  changes in business strategy or development plans,                       

.  the ability to attract and retain qualified personnel, and               

.  the successful integration of Global Crossing and Frontier.              

This list provides only an example of some of the risks, uncertainties and  
assumptions that may affect the forward-looking statements of Global Crossing   
and Frontier. If any of these risks or uncertainties materialize or fail to     
materialize, as applicable, or if the underlying assumptions prove incorrect,   
actual results may differ materially from those projected in the forward-       
looking statements.                                                             

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The Global Crossing Annual Meeting

General                                                                         

 We are furnishing this document to holders of Global Crossing common stock in
connection with the solicitation of proxies by the Global Crossing board of     
directors for use at the annual meeting of Global Crossing shareholders and any 
adjournment or postponement of the meeting.                                     

Date, time and place                                                            

We will hold the Global Crossing annual meeting at the St. Regis Hotel, 2   
East 55th Street, New York, New York on September 22, 1999 at 10:00 a.m., local 
time, subject to any adjournments or postponements.                             

Matters to be considered at the meeting                                         

For more information regarding the proposals described below, see "Proposals
to Global Crossing Shareholders To Be Voted on at the Global Crossing Annual    
Meeting" beginning on page 145.                                                 

The merger proposals                                                          

At the Global Crossing annual meeting, the shareholders of Global Crossing  
will consider and vote upon two merger-related proposals:                       

.  to approve an increase in the authorized share capital of Global         
Crossing to 3,000,000,000 shares and                                  

.  to approve the issuance of shares of Global Crossing common stock to     
Frontier shareholders in the merger.                                  

We are submitting these proposals for the approval of shareholders of Global
Crossing pursuant to Global Crossing's bye-laws and the requirements of the     
National Association of Securities Dealers applicable to companies with         
securities quoted on the Nasdaq National Market.                                

Other proposals                                                               

In addition, at the Global Crossing annual meeting, the shareholders of     
Global Crossing will consider and vote upon:                                    

.  a proposal to authorize 20,000,000 shares of preferred stock, par value  
$0.01 per share;                                                      

.  a proposal to amend a number of the bye-laws of Global Crossing and to   
restate them;                                                         

.  a proposal to elect Abbott L. Brown, Thomas J. Casey, William E. Conway  
and Barry Porter as class A directors with terms expiring in 2000;    

.  a proposal to elect Robert Annunziata, Lodwrick M. Cook, Geoffrey J.W.   
  Kent, David L. Lee, Bruce Raben and Jack M. Scanlon as class B directors
with terms expiring in 2001;                                          

.  a proposal to elect Jay R. Bloom, Dean C. Kehler, Michael R. Steed,      
Hillel Weinberger and Gary Winnick as class C directors with terms    
expiring in 2002;                                                     

.  a proposal to elect, subject to the merger closing, the following        
persons who are currently Frontier directors as directors of Global   
 Crossing: James F. McDonald as a class A director with a term beginning
immediately after the closing and expiring in 2000, Eric Hippeau as a 
  class B director with a term beginning immediately after the closing and
expiring in 2001 and Joseph P. Clayton and Douglas H. McCorkindale as 
class C directors, each with a term beginning immediately after the   
closing and expiring in 2002;                                         

.  a proposal to amend the 1998 Global Crossing Ltd. Stock Incentive Plan   
 for the purpose of increasing the number of authorized shares of Global
Crossing common stock reserved for issuance under that plan;          

.  a proposal to ratify Global Crossing's existing compensation plan for    
its outside directors;                                                

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.  a proposal to ratify the appointment of Arthur Andersen & Co. as         
  independent auditors of Global Crossing for the year ending December 31,
1999 and authorize the Global Crossing board of directors to determine
their remuneration; and                                               

.  any other business which may properly come before the annual meeting or  
any adjournment or postponement thereof.                              

Record date; votes per share                                                    

The Global Crossing board of directors has fixed the close of business on   
July 29, 1999 as the record date for the determination of Global Crossing       
shareholders entitled to notice of the annual meeting. On that date, the        
outstanding voting shares of capital stock of Global Crossing consisted of      
412,732,100 shares of common stock. However, all holders of record of shares of 
Global Crossing common stock on the date of the Global Crossing annual meeting  
will be entitled to attend and vote at the meeting.                             

 On a poll, each share entitled to vote at the meeting, other than shares held
by holders of greater than 9.5% of all outstanding shares of Global Crossing    
common stock whose voting power will be limited as described in the next two    
paragraphs, will be entitled to one vote plus any additional votes that may be  
allocated to each share based on a formula contained in the Global Crossing     
bye-laws and described in the next two paragraphs.                              

For purposes of the following discussion, when we refer to "Controlled      
Shares" we mean, among other things, all shares of Global Crossing common stock 
that a shareholder is deemed (1) to own directly, indirectly or constructively  
pursuant to Section 958 of the Internal Revenue Code or (2) to own 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 Securities Exchange Act of     
1934 and the rules and regulations under that act.                              

 Under the Global Crossing bye-laws, on a poll each share of common stock will
have one vote, except that if, and so long as, the Controlled Shares of (1) any 
shareholder constitute more than 9.5% of the voting power of all outstanding    
shares of Global Crossing common stock or (2) Canadian Imperial Bank of         
Commerce and its affiliates constitute more than 35% of the voting power of all 
outstanding shares of Global Crossing capital stock, the voting rights with     
respect to the Controlled Shares owned by that shareholder will be limited, in  
the aggregate, to a voting power of 9.5% or, in the case of Canadian Imperial   
Bank of Commerce and its affiliates, collectively, to 35% based on a formula    
contained in the bye-laws. The additional votes that could be cast by that      
shareholder or the Canadian Imperial Bank of Commerce and its affiliates if     
there were no restrictions on voting rights will be allocated to the other      
holders of common stock, pro rata based on their number of shares of common     
stock. However, no shareholder that has been allocated any additional votes may 
exceed the limitation on voting rights as a result of that allocation. See      
"Description of Global Crossing Capital Stock--Voting and transfer              
restrictions."                                                                  

On the record date for notice of the annual meeting, each share of Global   
Crossing common stock, other than shares held by any 9.5% or larger             
shareholder, would have been entitled on a poll to approximately 1.1794 votes.  

Quorum                                                                          

The presence in person or by proxy of at least two shareholders entitled to 
vote and holding shares representing more than 50% of the votes of all          
outstanding shares of Global Crossing common stock will constitute a quorum at  
the annual meeting.                                                             

Abstentions and shares held by brokers that are represented at the annual   
meeting without specific instructions by shareholders on how to vote those      
shares will be counted as present for purposes of determining whether there is  
a quorum at the annual meeting.                                                 

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Votes required                                                                  

 Approval of each of the proposals requires the affirmative vote of at least a
majority of all outstanding shares of Global Crossing common stock, except in   
the case of the proposed amendments of                                          

(1) bye-laws 34(2) and 63(2), (3) and (4) regarding the voting and      
transfer of share restrictions,                                             

(2) bye-laws 63(1) and 130 regarding the Global Crossing board of       
directors' authority to establish a record date for shareholders entitled   
to vote at annual and special meetings of shareholders and                  

(3) bye-law 148 regarding minimum voting requirements for bye-law       
amendments,                                                                 

which in each case require the affirmative vote of at least 75% of all          
outstanding shares of Global Crossing common stock to be approved. Some of the  
proposed bye-law amendments, if approved, will become effective only if and     
when the merger is complete.                                                    

Shareholders who beneficially own shares of Global Crossing common stock    
representing over a majority of the voting power of Global Crossing after       
giving effect to the voting limitations of large shareholders entered into a    
voting agreement with Frontier on March 16, 1999 which was reaffirmed on May    
16, 1999. In addition, U S WEST entered into a voting agreement with Global     
Crossing with respect to shares it acquired in the tender offer.                

Under the voting agreements, these shareholders have agreed to vote in favor
of both the proposal to increase the authorized share capital of Global         
Crossing and the proposal to issue shares of Global Crossing common stock in    
the merger. As a result, the vote of these shareholders will be sufficient to   
approve these two proposals without any further vote by any other Global        
Crossing shareholder. See "Related Agreements--Voting agreement."               

 As of July 29, 1999, directors and executive officers of Global Crossing were
entitled to vote approximately 68.43% of the outstanding votes entitled to be   
cast by Global Crossing shareholders at the annual meeting after giving effect  
to the voting limitations of large shareholders. Each director and executive    
officer of Global Crossing has indicated that he or she intends to vote his or  
her shares of common stock for the proposal to increase Global Crossing's       
authorized share capital and for the proposal to issue shares of Global         
Crossing common stock in the merger.                                            

How shares will be voted at the annual meeting                                  

Shares of Global Crossing common stock represented by a proxy properly      
executed and received before the vote at the Global Crossing annual meeting     
will be voted at the meeting on a poll in the manner directed on the proxy      
card, unless the proxy is revoked in advance of the vote.                       

Properly executed blank proxy cards will be voted (1) in favor of the       
proposals described in the notice of the 1999 annual meeting to Global Crossing 
shareholders and (2) in the discretion of the authorized proxies with respect   
to any other business that may properly come before the annual meeting or any   
adjournment or postponement of the meeting.                                     

Abstentions and shares held by brokers and represented at the annual meeting
without specific instructions by shareholders on how to vote those shares will  
not be voted and will have the effect of a vote against the merger-related      
proposals and the other proposals to be voted on at the annual meeting.         

 To be valid, proxy cards must be received at the offices of Global Crossing's
transfer agent, First Chicago Trust Company of New York, by September 21, 1999. 
As an alternative to appointing a proxy, a Global Crossing shareholder which is 
a corporation may appoint any person to act as its representative by delivering 
written evidence of that appointment, which must be received at Global          
Crossing's principal executive offices not later than one hour before the time  
fixed for the beginning of the meeting. A representative so appointed may       
exercise the same powers, including voting rights, as the appointing            
corporation could exercise if it were an individual shareholder.                

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How to revoke a proxy                                                           

You may revoke your proxy at any time before it is voted by (1) so notifying
the Secretary of Global Crossing in writing at the address of Global Crossing's 
principal executive offices not less than one hour before the time fixed for    
the beginning of the meeting, (2) signing and dating a new and different proxy  
card or (3) voting your shares in person or by an appointed agent or            
representative at the meeting. You may not revoke your proxy by merely          
attending the Global Crossing annual meeting.                                   

 The Global Crossing board of directors is not currently aware of any business
that will be brought before the annual meeting other than the proposals         
described in the notice of the 1999 annual meeting to Global Crossing           
shareholders. If, however, other matters are properly brought before the Global 
Crossing annual meeting or any adjournment or postponement of the meeting, the  
persons appointed as proxies will have discretionary authority to vote the      
shares represented by duly executed proxies in accordance with their discretion 
and judgment.                                                                   

Solicitation of proxies                                                         

 Global Crossing will bear the costs of soliciting proxies from the holders of
Global Crossing common stock. Proxies will initially be solicited by Global     
Crossing by mail, but directors, officers and selected other employees of       
Global Crossing may also solicit proxies by personal interview, telephone,      
telegraph or e-mail. Directors, executive officers and any other employees of   
Global Crossing who solicit proxies will not be specially compensated for those 
services, but may be reimbursed for out-of-pocket expenses incurred in          
connection with the solicitation. Brokerage houses, nominees, fiduciaries and   
other custodians will be requested to forward soliciting materials to           
beneficial owners and will be reimbursed for their reasonable out-of-pocket     
expenses incurred in sending proxy materials to beneficial owners. Global       
Crossing has retained MacKenzie Partners, Inc. to aid in the solicitation of    
proxies. MacKenzie Partners will receive customary fees and expense             
reimbursement for its services. Global Crossing's transfer agent, First Chicago 
Trust Company of New York, has agreed to assist Global Crossing in connection   
with the tabulation of proxies.                                                 

1998 audited financial statements                                               

Under the Global Crossing bye-laws and Bermuda law, audited financial       
statements must be presented to shareholders at an annual meeting. To fulfill   
this requirement, Global Crossing will present at the annual meeting audited    
consolidated financial statements for the fiscal year 1998. Global Crossing has 
included copies of those financial statements in this document.                 

Representatives of Arthur Andersen & Co., Global Crossing's independent     
auditors, will be present at the annual meeting and available to respond to     
appropriate questions. These representatives will have the opportunity to make  
a statement at the annual meeting if they desire to do so.                      

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The Frontier Special Meeting

General                                                                         

We are furnishing this document to holders of Frontier common stock for use 
at a special meeting of Frontier shareholders and any adjournments or           
postponements of the meeting.                                                   

Date, time and place                                                            

We will hold a special meeting of Frontier shareholders on September 23,    
1999, at 10:30 a.m., local time, at the Crowne Plaza of Rochester, 70 State     
Street, Rochester, New York, subject to any adjournments or postponements       
thereof.                                                                        

Matter to be considered at the special meeting                                  

At the Frontier special meeting, Frontier shareholders will be asked to     
consider and vote on a proposal to adopt the merger agreement. You are urged to 
read the copy of the merger agreement attached to this document as Annex A.     

Representatives of PricewaterhouseCoopers LLP, Frontier's independent       
auditors, are expected to be present at the Frontier special meeting and        
available to respond to appropriate questions. These representatives will be    
given the opportunity to make a statement at the Frontier special meeting if    
they desire to do so.                                                           

Record date                                                                     

Only holders of record of Frontier common stock at the close of business on 
July 29, 1999 will be entitled to receive notice of and to vote at the Frontier 
special meeting. As of the Frontier record date, there were 173,523,037         
outstanding shares of Frontier common stock.                                    

Vote required                                                                   

The affirmative vote by holders of two-thirds of the outstanding shares of  
Frontier common stock is required in order to adopt the merger agreement.       
Therefore, if you fail to submit a proxy or vote electronically or if you       
abstain from voting, it will have the effect of a vote against the adoption of  
the merger agreement. Each share of Frontier common stock is entitled to one    
vote. Holders of a majority of the shares entitled to vote at the Frontier      
special meeting, present in person or by proxy, will constitute a quorum for    
the transaction of business at the Frontier special meeting.                    

As of July 29, 1999, Frontier's current directors and executive officers    
beneficially owned a total of approximately 3,026,000 shares of Frontier common 
stock, or approximately 1.7% of the issued and outstanding shares of Frontier   
common stock on that date.                                                      

The shareholders present at the Frontier special meeting, in person or by   
proxy, may by a majority vote adjourn the meeting despite the absence of a      
quorum. In the event of an absence of a quorum, Frontier expects that the       
meeting will be adjourned or postponed to solicit additional proxies.           

How shares will be voted at the special meeting                                 

All shares of Frontier common stock represented by properly executed proxies
received before or at the Frontier special meeting, and not revoked, will be    
voted as specified in the proxies. Properly executed proxies that do not        
contain voting instructions will be voted FOR the adoption of the merger        
agreement.                                                                      

 Frontier will count a properly executed proxy marked "ABSTAIN" as present for
purposes of determining whether there is a quorum at the Frontier special       
meeting. Abstentions, however, will have the same effect as a vote against the  
adoption of the merger agreement.                                               

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Under New York Stock Exchange rules, your broker cannot vote your shares of 
Frontier common stock without specific instructions from you. Unless you follow 
the directions your broker provides to you regarding how to instruct your       
broker to vote your shares, your shares will not be voted and will have the     
effect of a vote against the adoption of the merger agreement.                  

The Frontier board of directors is not currently aware of any other business
to be brought before the Frontier special meeting. If, however, other matters   
are properly brought before the Frontier special meeting or any adjournment or  
postponement of the meeting, the people appointed as proxies will have          
discretionary authority to vote the shares represented by duly executed proxies 
in accordance with their discretion and judgment.                               

The people named as proxies by a shareholder may propose and vote for one or
more adjournments of the Frontier special meeting to permit further             
solicitations of proxies in favor of adoption of the merger agreement; except   
that no proxy which is voted against the adoption of the merger agreement will  
be voted in favor of any adjournment.                                           

Voting at the special meeting                                                   

Whether or not you plan to attend the special meeting, please take the time 
to vote your shares as soon as possible. Your prompt voting by telephone,       
electronically or by mail may save Frontier the expense of a second mailing.    
Each proxy which is properly completed will be voted at the special meeting. If 
you return a proxy by mail or vote by telephone or electronically over the      
Internet and do not specify your vote, your shares will be voted as recommended 
by the Frontier board of directors. Specifically, if your proxy does not        
specify a choice, your shares will be voted FOR the adoption of the merger      
agreement.                                                                      

Methods of voting                                                               

All shareholders may vote by mail. Shareholders of record can also vote by  
telephone or electronically over the Internet. Shareholders who hold their      
shares through a bank or broker can vote by telephone or electronically over    
the Internet if that option is offered by the bank or broker.                   

.  Voting by mail. Shareholders may sign, date and mail their proxies in    
the postage-paid envelope provided.                                   

.  Voting by telephone or Internet. Shareholders of record may vote by      
using the toll-free number listed on the proxy card or electronically 
  over the Internet. Telephone and/or Internet voting is also available to
shareholders who hold their shares through a Frontier Corporation     
benefit plan. The telephone and Internet voting procedures verify     
shareholders through the use of a control number that is provided on  
each proxy card. Both procedures allow you to vote your shares and to 
confirm that your shares have been properly recorded. Please see your 
proxy card for specific instructions.                                 

How to revoke a proxy                                                           

Your grant of a proxy on the enclosed proxy card does not prevent you from  
voting in person or otherwise revoking your proxy.                              

You may revoke your proxy at any time before its use by delivering to the   
Corporate Secretary of Frontier a signed notice of revocation or a later-dated  
signed proxy or by voting by telephone or Internet at a later time or by        
attending the Frontier special meeting and voting in person. Attendance at the  
Frontier special meeting will not itself constitute the revocation of a proxy.  

Solicitation of proxies                                                         

Frontier will pay the cost of solicitation of proxies for the Frontier      
special meeting. In addition to solicitation by mail, Frontier will arrange for 
brokerage houses and other custodians, nominees and fiduciaries to send the     
proxy materials to beneficial owners, and Frontier will, upon request,          
reimburse the brokerage                                                         

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houses and custodians for their reasonable expenses. Frontier has retained      
Innisfree M&A Incorporated to aid in the solicitation of proxies and to verify  
some of the records related to the solicitations. Innisfree will receive        
customary fees, and expense reimbursement for its services. To the extent       
necessary in order to ensure sufficient representation at its meeting, Frontier 
or its representatives may request by telephone, facsimile, electronic mail or  
the Internet the return of proxy cards. The extent to which this will be        
necessary depends entirely on how promptly proxy cards are returned. We urge    
you to send in your proxies as soon as possible.                                

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The Merger

What you will receive in the merger                                             

At the effective time of the merger, a direct wholly owned subsidiary of    
Global Crossing will be merged with and into Frontier. As a result of the       
merger, Frontier will continue as the surviving corporation of the merger and   
will become a wholly owned subsidiary of Global Crossing.                       

At the effective time of the merger, each issued and outstanding share of   
Frontier common stock, other than shares owned or held directly or indirectly   
by Global Crossing or directly by Frontier, which will be canceled, will be     
converted into the right to receive a number of shares of Global Crossing       
common stock equal to the exchange ratio. The exchange ratio will be equal to   
the number, rounded to the nearest 1/10,000, obtained by dividing $63.00, as    
increased by 7% per annum, compounded daily, from and after December 31, 1999   
to and including the effective time of the merger, by the average, rounded to   
the nearest 1/10,000, of the volume weighted averages, rounded to the nearest   
1/10,000, of the trading prices of the Global Crossing common stock for 15      
trading days randomly selected by lot by Frontier and Global Crossing during    
the 30 trading days ending on the trading day before the date that all          
conditions to closing have been satisfied or waived. However, the merger        
agreement provides that the exchange ratio will not be less than 1.1095, when   
the average trading price is more than $56.7813, or, except as described in the 
next sentence, greater than 1.8229, as increased by 7% per annum, compounded    
daily, from and after December 31, 1999 to and including the effective time of  
the merger, when the average trading price is less than $34.5625. The exchange  
ratio will remain 1.1095, without any increase for the 7% per annum interest    
factor, if the average trading price during the measurement period is more than 
$56.7813.                                                                       

Since the date of the merger agreement, the Global Crossing common stock has
traded within a range from $32.94 to $64.25. The average trading price for      
purposes of determining the exchange ratio will be based on the trading prices  
of the Global Crossing common stock during the measurement period shortly       
before the closing, which measurement period may end after the date of the      
Frontier special meeting.                                                       

If the average price of Global Crossing common stock during the measurement 
period is less than $34.5625, Frontier may, but is not required to, terminate   
the merger agreement unless Global Crossing elects to increase the merger       
consideration so that the value of the merger consideration to be received by   
Frontier shareholders, based on the average price during the measurement        
period, is equal to $63.00.                                                     

Global Crossing will not issue fractional shares of Global Crossing common  
stock in the merger. Instead, Frontier shareholders who would otherwise have    
been entitled to receive a fraction of a share of Global Crossing common stock  
will receive cash, without interest, in an amount equal to the product of the   
fractional part of a share of Global Crossing common stock multiplied by the    
last sales price per share of the Global Crossing common stock reported on the  
Nasdaq National Market on the closing date.                                     

As an example, if the closing occurs on or before December 31, 1999 and you 
own 100 shares of Frontier common stock and assuming that the average trading   
price during the measurement period is $36.00, which was the closing price of   
the Global Crossing common stock on August 4, 1999, the exchange ratio would be 
1.7500, or $63 divided by $36.00. This would translate into 175 shares of       
Global Crossing common stock. Using this same trading price, if the closing     
occurs on March 31, 2000, the exchange ratio would be 1.7807, or $64.1060       
divided by $36.00. $64.1060 is equal to $63.00 plus the 7% per annum interest   
factor compounded daily from January 1, 2000 through March 31, 2000. In this    
case, you would receive 178 shares of Global Crossing common stock. In the      
event of fractional shares, you would receive a check for an amount equal to    
the fractional share multiplied by the last sales price of Global Crossing      
common stock on the closing date.                                               

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Background of the merger                                                        

In light of the rapid changes in the telecommunications and Internet        
industries, including industry consolidation and globalization, it had become a 
regular practice of the Frontier board of directors to review periodically with 
senior management Frontier's position relative to its traditional peers and new 
entrants in the industry, changes in the competitive landscape and technology   
as well as the strategic alternatives available to Frontier in order for it to  
remain competitive and enhance shareholder value. In connection with this       
ongoing review of its long-term strategic plans, Frontier had been considering  
a wide range of strategic options, including internal growth through the        
buildout and aggressive marketing of its existing network to existing and       
emerging telecommunications and information service providers, growth through   
various strategic alliances, acquisitions or combinations and potential         
corporate restructuring transactions. In furtherance of these objectives, from  
time to time Frontier has had contact with various parties to explore on a      
preliminary basis several of these alternatives, including some discussions     
with one or more parties during the time periods described below.               

In October of 1998, at a Morgan Stanley investors' conference, Barry Porter,
a Senior Vice President of Global Crossing, suggested to Rolla Huff, then Chief 
Financial Officer of Frontier, that Frontier and Global Crossing consider the   
possibility of engaging in strategic partnerships. A few weeks later, Thomas    
Casey, a Vice Chairman of Global Crossing, contacted Joseph Clayton, Chief      
Executive Officer of Frontier, and requested a meeting to discuss a number of   
potential mutually beneficial business arrangements, including purchases or     
swaps of capacity, other commercial arms'-length business transactions and the  
possibility of a strategic transaction involving the two companies.             

On November 17, 1998, Mr. Casey met with Mr. Huff, Jonathan Horowitch, Vice 
President-Corporate Development of Frontier, and R. Charles Mancini, Vice       
President-Network Financial Management of Frontier. At the meeting, the         
representatives of each company discussed generally their respective businesses 
and various potential strategic business arrangements that might benefit both   
Frontier and Global Crossing. In addition, Mr. Casey raised the possibility of  
a "merger of equals" business combination transaction involving a share-for-    
share exchange of Frontier shares for Global Crossing shares following which    
either Frontier shareholders or Global Crossing shareholders would own a        
majority of the resulting company, based on the respective capitalizations of   
the two companies at that time.                                                 

At its regularly scheduled executive committee meeting on November 23, 1998,
the executive committee of the Frontier board of directors was briefed on       
recent discussions with various entities, including Global Crossing, regarding  
potential strategic transactions.                                               

During the next few weeks, there were various meetings and discussions among
representatives of Global Crossing, Frontier, Merrill Lynch, one of Global      
Crossing's financial advisors, and Morgan Stanley & Co. Incorporated,           
Frontier's financial advisor, regarding possible transaction structures and the 
strategic objectives that could be achieved through such a transaction. At a    
meeting held on November 30, 1998, Mr. Casey indicated that Global Crossing was 
contemplating a transaction based upon one of two alternative structures, the   
first involving consideration consisting of a combination of cash and Global    
Crossing common stock, subject to a collar, and shares of Frontier's local      
exchange company following a split-off of that company, and the other proposal  
involving cash and Global Crossing common stock, subject to a collar. The       
collar mechanism would provide for a range of exchange ratios, subject to a     
maximum ratio and a minimum ratio, at which one share of Frontier common stock  
would be exchanged for shares of Global Crossing common stock. The collar would 
enable the value of the shares of Global Crossing common stock to remain fixed  
so long as the average trading price of the Global Crossing common stock during 
a period of time shortly before the closing remained within the endpoints of    
the collar. Mr. Huff indicated that Frontier would need to better understand    
the structure of Global Crossing's financing of any transaction involving cash  
and that, in any such transaction, Frontier would not bear the risk of that     
financing not being obtained.                                                   

On December 5, 1998, Global Crossing engaged Salomon Smith Barney as its    
financial advisor in addition to Merrill Lynch.                                 

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On December 8, 1998, Global Crossing and Frontier executed a confidentiality
agreement, effective as of November 30, 1998, covering the exchange of          
nonpublic information between the companies for the purpose of evaluating a     
potential strategic combination.                                                

On December 15, 1998, at a regularly scheduled meeting of the Frontier board
of directors, Mr. Huff, in connection with updating the Frontier board of       
directors on the progress with respect to the various strategic alternatives    
discussed at an earlier meeting in October and at the November executive        
committee meeting, briefly reviewed the discussions with Global Crossing and    
other entities to date.                                                         

On December 18, 1998, representatives of Global Crossing and its financial  
advisors discussed its financing plans with Frontier and its representatives.   

On December 30, 1998, representatives of Global Crossing and its financial  
advisors met with representatives of Frontier and its financial advisor to      
discuss Global Crossing's business plan and to hold further discussions         
regarding the respective valuations of Global Crossing and Frontier and the     
appropriate mechanisms to protect the value of the consideration to be received 
by Frontier shareholders.                                                       

Representatives of Global Crossing and Frontier and their respective        
financial advisors again met on January 11, 1999 to discuss a potential         
combination of the two companies and the potential valuation of Frontier. At    
the end of the meeting, the parties determined that there was a difference in   
views as to the appropriate value to be placed on the stock of Frontier and     
discussions with respect to a business combination transaction were terminated  
with no expectation that they would be resumed in the immediate future.         
Frontier subsequently focused on the pursuit of other strategic alternatives    
designed to enhance shareholder value, including those described below.         

On January 25, 1999, at its regularly scheduled meeting, the Frontier board 
of directors was updated on the status of the prior discussions with Global     
Crossing. Representatives of Morgan Stanley gave a presentation on Global       
Crossing, including a discussion of Global Crossing's business, strategy and    
financial results, the strategic rationale for a transaction between Global     
Crossing and Frontier, an analysis of Frontier's current position and a review  
of other potential strategic and capitalization alternatives, including a       
possible spin-off transaction. At the meeting, presentations were also made     
regarding a change in Frontier's dividend policy. After discussion and          
consideration, the Frontier board of directors decided to adopt a reduction in  
the dividend to be paid on the Frontier common shares effective with the next   
quarterly dividend to be declared and it determined to continue studying the    
possibility of a spin-off.                                                      

 Although discussions regarding a business combination between Global Crossing
and Frontier had broken off, Frontier and Global Crossing continued to discuss  
other mutually beneficial business arrangements, including shared capacity and  
network swaps. In mid-February 1999, during a meeting to discuss these          
arrangements, the possibility of a business combination was again discussed.    
Mr. Huff suggested that Frontier might be willing to resume discussions if      
Global Crossing provided increased value to Frontier shareholders and offered   
appropriate collar protection.                                                  

On March 2, 1999, Mr. Casey telephoned Mr. Clayton to arrange a meeting to  
discuss a potential business combination. On March 3, 1999, Messrs. Clayton and 
Huff met with Robert Annunziata, the Chief Executive Officer of Global          
Crossing, and Mr. Casey. At the meeting, the parties renewed discussions        
regarding potential transaction structures and valuations based on the current  
price of Global Crossing common stock, which at the close of trading on the day 
of the meeting was $31.5625 (adjusted for the March 9 stock split). At the      
meeting, the parties agreed that any transaction would be structured to provide 
consideration to Frontier shareholders based on a fixed value of Global         
Crossing shares, with the value of the consideration to be protected through a  
collar mechanism.                                                               

 Following the meeting, Messrs. Clayton and Huff telephoned the members of the
executive committee of the Frontier board of directors to report on these       
discussions. Frontier also contacted, and authorized Morgan Stanley to contact, 
other potential acquirors, none of whom made a proposal to acquire Frontier.    

By March 8, 1999, Global Crossing's stock price had increased to $37.50     
(adjusted for the March 9 stock split). During the week of March 8th, Mr. Huff  
called Mr. Casey to discuss the recent increases in Global Crossing's stock     
price. Mr. Huff informed Mr. Casey that, as a result of the increase in Global  
Crossing's stock price, the level of value and the structure of the value       
assurance protection that the parties had been discussing                       

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were no longer appropriate. Accordingly, before any transaction could be agreed 
upon, Global Crossing would have to reconsider the levels of value being        
discussed to increase the consideration to be paid to Frontier shareholders to  
take into account the increase in Global Crossing stock price. Also, Global     
Crossing would need to consider adjusting the collar mechanism so that the      
increase in price did not eliminate the protection against a decline in Global  
Crossing stock price that had previously been discussed and so that Frontier    
shareholders would still have an opportunity to share in future increases in    
Global Crossing's stock price. The parties agreed to continue conducting due    
diligence and defer further discussions of the pricing issues until near the    
end of the contract negotiations.                                               

Also during the week of March 8th, representatives of Global Crossing and   
Frontier and their respective legal and financial advisors conducted due        
diligence on each other, including tax due diligence to determine the           
feasibility of Global Crossing completing a tax-free reorganization. In the     
beginning of that week, Skadden, Arps, Slate, Meagher & Flom LLP, Global        
Crossing's legal advisor, also delivered a draft merger agreement to Frontier   
and Simpson Thacher & Bartlett, Frontier's legal advisor. During the remainder  
of that week, there were numerous meetings and telephone calls between senior   
management of both parties and their respective legal and financial advisors to 
negotiate the terms of the merger agreement and the related agreements.         

On March 12, 1999, when the price of Global Crossing's common stock was     
$49.375, representatives of Global Crossing suggested that Global Crossing at   
that time would be prepared to offer, subject to board approval, completion of  
due diligence and the negotiation of satisfactory definitive agreements, shares 
of Global Crossing common stock valued at $62.00, based on the average trading  
prices for the Global Crossing common stock during a period shortly before the  
merger, for each share of Frontier common stock, with a 30% downside collar and 
a 15% upside collar, all based on the Global Crossing closing price of $49.375  
on that date. As a result, Frontier shareholders would receive $62.00 per       
share, based on that average trading price, so long as Global Crossing's        
average trading price was between $34.5625 and $56.7813. In addition, Frontier  
would have the right, but not the obligation, to terminate the merger agreement 
if the Global Crossing average trading price during the applicable measurement  
period was below $34.5625, unless Global Crossing agreed to provide additional  
consideration to ensure that Frontier shareholders would receive $62.00 in      
value in the merger, based on the average trading price. Frontier shareholders  
would also be able to participate in an increase in Global Crossing's stock     
price above $56.7813.                                                           

 On March 13th and 14th, Messrs. Clayton and Huff contacted each member of the
Frontier board of directors to update him or her on the discussions that had    
taken place during the past two weeks. Also on those dates, representatives of  
Frontier and Global Crossing and their legal counsel continued to negotiate the 
terms of a definitive merger agreement and the related agreements and continued 
due diligence.                                                                  

On March 15, 1999, the Frontier board held a meeting to review the terms of 
the proposed merger. At the beginning of the meeting, Simpson Thacher &         
Bartlett advised the Frontier board regarding its fiduciary duties with respect 
to any potential transaction involving Global Crossing. Senior management of    
Frontier updated the Frontier board on the negotiations that had taken place    
during the last two days. The Frontier board of directors was also informed of  
the status of contacts with other potential acquirors as to any interest in a   
potential business combination with Frontier and it discussed its other         
strategic alternatives, including the alternative of engaging in no             
transaction. Representatives of Simpson Thacher & Bartlett reviewed the terms   
of the proposed merger agreement, stock option agreement and voting agreement.  
Representatives of Morgan Stanley reviewed in detail with the Frontier board of 
directors their financial and valuation analyses of the Global Crossing         
proposal as well as provided a brief summary of certain of the restructuring    
options. The Frontier board also discussed the break-up fee requested by Global 
Crossing as well as the stock option and, after discussions with senior         
management and its advisors, concluded that those deal protections would not    
meaningfully impair the possibility of a superior alternative transaction.      
After further discussion, the Frontier board authorized senior management to    
pursue discussions to finalize a definitive merger agreement and stock option   
agreement with Global Crossing.                                                 

 On March 16, 1999, the Global Crossing board of directors met to consider the
terms and conditions of a proposed merger with Frontier. At the meeting,        
Skadden, Arps, Slate, Meagher & Flom LLP and Appleby                            

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Spurling & Kempe advised the Global Crossing board of directors regarding its   
fiduciary duties with respect to any potential merger transaction involving     
Frontier. Several presentations were then made by Global Crossing senior        
management regarding, among other things, an overview of Frontier, strategy for 
the combined company and the results of due diligence. Representatives of       
management and Skadden, Arps, Slate, Meagher & Flom LLP reviewed the terms of   
the proposed merger agreement, the stock option agreement and the voting        
agreement. The board of directors also discussed the deal protection benefits   
provided by the break-up fee and the stock option agreement. Representatives of 
Merrill Lynch and Salomon Smith Barney reviewed in detail their financial and   
valuation analyses of the merger proposal and rendered their respective         
opinions that the original exchange ratio was fair from a financial point of    
view to Global Crossing. After further discussion and consideration, the Global 
Crossing board of directors unanimously determined that the merger was fair to  
Global Crossing and approved the merger agreement, the stock option agreement   
and the voting agreement and the transactions contemplated by the merger        
agreement, the stock option agreement and the voting agreement, including the   
increase in authorized share capital and the issuance of shares of Global       
Crossing common stock in the merger.                                            

On March 16, 1999, the Frontier board of directors met to continue its      
consideration of the Global Crossing proposal. The Frontier board was updated   
on the discussions held since the previous day and on a few changes to the      
terms of the merger agreement. In addition, Morgan Stanley gave a presentation  
that provided additional analysis of the Global Crossing proposal and rendered  
its opinion as to the fairness from a financial point of view of the original   
exchange ratio to Frontier shareholders. Following discussion among the board   
members, Messrs. Annunziata and Casey joined the meeting to elaborate on Global 
Crossing's strategy and rationale for the transaction and to answer questions   
raised by the directors. After Messrs. Annunziata and Casey departed and        
following further discussion and consideration, the Frontier board of directors 
unanimously determined that the merger was fair to and in the best interests of 
Frontier and its shareholders and adopted the merger agreement and approved the 
merger and the stock option agreement and the transactions contemplated by the  
merger agreement and the stock option agreement.                                

Following the Frontier board meeting, the merger agreement, the stock option
agreement and the voting agreement were executed. The parties issued a joint    
press release announcing the proposed merger before the opening of business on  
March 17, 1999.                                                                 

During late April, representatives of Global Crossing disclosed to          
representatives of Frontier that Global Crossing was holding preliminary        
discussions with U S WEST regarding a possible business combination. At the     
beginning of the week of May 10, 1999, representatives of Global Crossing       
contacted representatives of Frontier to inform them of a proposed transaction  
between Global Crossing and U S WEST and to request Frontier's consent to the   
transaction pursuant to specified provisions of the merger agreement.           
Throughout the remainder of that week, representatives of Global Crossing and   
its legal and financial advisors held various meetings with representatives of  
Frontier and its legal and financial advisors to discuss the terms of the       
proposed transaction and the impact of that transaction on the pending merger   
with Frontier. After discussion and negotiation, Global Crossing and Frontier   
agreed to specified amendments to the merger agreement, including, among other  
things, an increase in the fixed value per share consideration to be received   
by Frontier shareholders in the merger to $63.00 so long as the cash tender     
offer to be made by U S WEST to purchase Global Crossing shares was completed   
and an increase in the value of the consideration by a 7% per annum interest    
factor if the Frontier merger did not close by December 31, 1999 and the        
average trading price of the Global Crossing common stock during the            
measurement period was not greater than $56.7813.                               

On May 16, 1999, the Frontier board of directors had a telephonic meeting to
consider whether to consent to the Global Crossing--U S WEST transaction. At    
that meeting, management of Frontier described the structure of the transaction 
with U S WEST and the potential impact on the merger with Frontier,             
representatives of Simpson Thacher & Bartlett described the proposed amendments 
to the terms of the Frontier merger agreement and representatives of Global     
Crossing and its legal and financial advisors provided additional information   
and answered questions regarding the proposed U S WEST transaction.             
Representatives of Salomon Smith Barney, Global Crossing's financial advisor,   
gave a presentation regarding financial aspects                                 

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of the proposed U S WEST merger that they planned to make to the Global         
Crossing board of directors and informed the Frontier board of directors that   
Salomon Smith Barney would be rendering an opinion to the Global Crossing board 
of directors as to the fairness from a financial point of view of the           
consideration to be received by Global Crossing shareholders in the U S WEST    
merger. Representatives of Morgan Stanley also gave a presentation with respect 
to the U S WEST merger and the amended terms of the Global Crossing-- Frontier  
merger agreement and rendered its opinion as to the fairness from a financial   
point of view of the revised exchange ratio to the Frontier shareholders.       
Following additional discussion, the board of directors of Frontier determined  
by the unanimous vote of all directors present that Frontier should consent to  
Global Crossing entering into the merger agreement with U S WEST and approved   
the amendment to the merger agreement.                                          

On May 16, 1999, the Global Crossing board of directors met to consider,    
among other things, the terms and conditions of the proposed merger with U S    
WEST and the terms and conditions of the amendment to the merger agreement.     
Global Crossing's financial and legal advisors attended the meeting. Senior     
management of Global Crossing and representatives of Skadden Arps reviewed with 
the board of directors of Global Crossing the terms and conditions of the       
amendment to the merger agreement, as well as various matters relating to the   
proposed merger with U S WEST, and reviewed related legal considerations.       
Salomon Smith Barney addressed various financial aspects of the proposed U S    
WEST merger. In addition, Salomon Smith Barney orally rendered its opinion      
that, as of May 16, 1999, the revised exchange ratio, as set forth in the       
amendment to the merger agreement, was fair from a financial point of view to   
Global Crossing. Extensive discussion followed relating to the financial and    
legal aspects of the amendment to the merger agreement and the U S WEST         
transaction. After discussion, Global Crossing's board of directors unanimously 
approved the amendment to the merger agreement, as well as the merger with U S  
WEST and the various definitive agreements related to that merger.              

Before the opening of business on May 17, 1999, the parties executed the    
amendment to the merger agreement and Global Crossing and U S WEST entered into 
a merger agreement and related agreements.                                      

On June 13, 1999, Frontier received an unsolicited acquisition proposal from
Qwest Communications International Inc. to acquire all of the common stock of   
Frontier. Qwest offered to pay $20 in cash and issue 1.181 shares of Qwest      
common stock for each share of Frontier common stock. On June 13, Qwest also    
announced a proposal to acquire all of the outstanding stock of U S WEST. In    
Qwest's June 13 proposal to Frontier, Qwest stated that it would increase the   
consideration payable for Frontier common stock to $20 in cash and 1.226 shares 
of Qwest common stock if U S WEST accepted Qwest's proposal. However, Qwest     
also stated that it would offer to enter into an agreement to acquire Frontier  
whether or not Qwest concluded its transaction with U S WEST.                   

On June 17, 1999, Frontier issued a press release announcing that its board 
of directors had reviewed the unsolicited acquisition offer made by Qwest and   
had determined to take no action with respect to the offer at that time.        
Frontier's board of directors directed Frontier's management to monitor events  
relating to the Qwest proposal.                                                 

 On June 23, 1999, Qwest submitted a revised acquisition proposal to Frontier.
Qwest offered to deliver cash and Qwest common stock having a value of $68 for  
each share of Frontier common stock consisting of $20 in cash and the balance   
in Qwest common stock. Qwest's revised offer included a "collar" on the price   
of Qwest common stock between $30.50 and $43.50. Qwest stated that it would     
protect the Frontier shareholders' value by paying more cash or issuing         
additional shares of Qwest common stock, at Qwest's option, to offset any       
decline in Qwest's stock price down to $30.50 per share. On June 23, 1999,      
Qwest also delivered a revised offer to U S WEST pursuant to which it increased 
the price of its offer and added a collar mechanism.                            

On June 30, 1999, Frontier announced that in view of all currently available
information and in consultation with its advisors, the Frontier board of        
directors had determined that the revised Qwest proposal                        

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"could reasonably be expected to constitute a superior proposal" for Frontier   
shareholders within the meaning of the Global Crossing merger agreement. The    
Frontier board of directors further determined that, consistent with its        
fiduciary obligations, it was appropriate to more fully inform itself in order  
to best serve Frontier's shareholders. Frontier's board of directors directed   
Frontier's management and advisors to meet with Qwest and explore the proposal  
and also to explore Global Crossing's position with respect to the revised      
Qwest proposal.                                                                 

On July 2, 1999, Frontier entered into a confidentiality agreement with     
Qwest. Over the next two weeks, Frontier and its financial and legal advisors   
had a number of meetings and conversations with Qwest and its financial and     
legal advisors to discuss the Qwest proposal. In addition, during this period   
representatives of Global Crossing and Qwest held discussions that included,    
among other things, the possibility that Qwest would terminate its acquisition  
proposal for Frontier upon execution by Qwest of a definitive merger agreement  
with U S WEST.                                                                  

On July 18, 1999, Global Crossing and Qwest entered into an agreement under 
which Global Crossing agreed to terminate its merger agreement with U S WEST,   
while Qwest agreed to cease all further discussions and actions in connection   
with its proposal to acquire Frontier. Also under this agreement, Qwest agreed  
to purchase capacity on the Global Crossing network at established market rate  
prices for delivery over the next four years and committed to make purchase     
price payments to Global Crossing for this capacity of $140 million over the    
next two years.                                                                 

 Also on July 18, 1999, Global Crossing and U S WEST entered into an agreement
to terminate the Global Crossing--U S WEST merger agreement. Under this         
agreement, U S WEST paid Global Crossing $140 million in cash and returned to   
Global Crossing 2,231,076 shares of Global Crossing common stock that U S WEST  
had acquired for a total of $140 million in its tender offer for Global         
Crossing common stock on June 18, 1999. U S WEST, however, remained bound by    
its agreement to vote the remaining shares of Global Crossing common stock it   
purchased in the tender offer in favor of the proposals relating to the Global  
Crossing--Frontier merger. U S WEST also agreed to give up the right it         
otherwise would have had upon termination of the Global Crossing--U S WEST      
merger agreement to appoint one member to the Global Crossing board of          
directors.                                                                      

Recommendation of the Global Crossing board of directors; Reasons for the       
merger                                                                          

The Global Crossing board of directors has unanimously determined that the  
merger and the share issuance in the merger are in the best interests of Global 
Crossing and its shareholders and has approved the merger agreement. The Global 
Crossing board of directors unanimously recommends that shareholders of Global  
Crossing vote FOR the increase in the authorized share capital and the share    
issuance at the Global Crossing annual meeting.                                 

The Global Crossing board of directors believes that the combined company   
following the merger would have the potential to realize long-term enhanced     
operating and financial results and a stronger competitive position.            
Specifically, the Global Crossing board of directors believes that the          
following represent benefits to be realized because of the merger and reasons   
for shareholders of Global Crossing to vote FOR approval of the proposals to    
increase the authorized share capital and issue the shares of Global Crossing   
common stock in the merger:                                                     

1. combining with Frontier will accelerate Global Crossing's global         
  strategy by integrating Frontier's United States terrestrial fiber optic
  capacity with Global Crossing's worldwide undersea and terrestrial fiber
 optic network, creating a seamless global network of telecommunications
facilities and services,                                              

2. given the complementary nature of Global Crossing's and Frontier's       
businesses, the merger will expand Global Crossing's global customer  
base and create new revenue sources,                                  

3. Global Crossing will be able to leverage its bandwidth capabilities to   
enter into Internet-related businesses and to offer national          
asynchronous transfer mode services,                                  

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4. Global Crossing's shareholders will have the opportunity to participate  
in the potential for diversified and enhanced growth after the merger,

5. Frontier's network infrastructure and computer support systems and       
associated business processes will promote rapid deployment of an     
 integrated voice and data network that will cover North America as well
as the broader global market,                                         

6. Global Crossing will avoid having to incur large build-out costs for     
United States terrestrial infrastructure,                             

7. the technical and marketing knowledge of Frontier's management and       
employees will permit Global Crossing to participate in the North     
American market immediately and aggressively,                         

8. the combined company will avoid the need to duplicate sales, marketing   
and administrative functions, and                                     

9. the increased scale of activities in the combined company's long-        
distance and international operations will result in opportunities to 
reduce costs through greater purchasing power and the adoption of best
  practices in cost containment related to the transport of communications
and information over long distance.                                   

In the course of deliberations, the Global Crossing board of directors      
reviewed with Global Crossing management and outside advisors a number of       
additional factors relevant to the merger, including:                           

1. historical information concerning Global Crossing's and Frontier's       
 respective businesses, financial performance and condition, operations,
technology, management and competitive position,                      

2. Global Crossing's view as to the financial condition, results of         
operations and businesses of Global Crossing and Frontier before and  
 after giving effect to the merger based on management due diligence and
publicly available information,                                       

3. reports from management and legal advisors as to the results of their    
due diligence investigation of Frontier,                              

4. current financial market conditions and historical market prices and     
trading information with respect to Global Crossing common stock and  
Frontier common stock,                                                

5. the consideration to be offered by Global Crossing in the merger and an  
analysis of the market value of the Global Crossing common stock to be
issued in exchange for each share of Frontier common stock in light of
comparable merger transactions, and                                   

6. detailed financial analyses and pro forma and other information with     
respect to the companies presented by Merrill Lynch and Salomon Smith 
Barney in a board presentation, including Merrill Lynch's and Salomon 
 Smith Barney's respective opinions that the original exchange ratio was
fair, as of March 16, 1999, the date of their opinions, to Global     
Crossing from a financial point of view and Salomon Smith Barney's    
  opinion that the revised exchange ratio was fair, as of May 16, 1999, to
Global Crossing from a financial point of view.                       

The Global Crossing board of directors also considered the terms of the     
merger agreement, the stock option agreement and the voting agreement. In       
addition, the Global Crossing board of directors noted that the merger is       
expected to be a tax-free transaction and accounted for as a purchase.          

The Global Crossing board of directors believed that these factors supported
the board's recommendations of the merger when viewed together with the risks   
and potential benefits of the merger.                                           

The Global Crossing board of directors also identified and considered a     
variety of potentially negative factors in its deliberations concerning the     
merger, including, but not limited to:                                          

1. the substantial charges to be incurred in connection with the merger,    
including costs of integrating the businesses and transaction expenses
arising from the merger,                                              

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2. the risk that the integration of the two companies' respective           
operations and employees might not occur in a timely manner,          

3. the risk that, despite the efforts of the combined company, key          
technical and management personnel might not remain employed by the   
combined company,                                                     

4. the risk that the potential benefits sought in the merger might not be   
fully realized,                                                       

5. the risk that potential growth strategies might not be fully achieved,   
and                                                                   

6. the other risks described under "Risk Factors" beginning on page 23 of   
this document.                                                        

The Global Crossing board of directors believed that these risks were       
outweighed by the potential benefits of the merger.                             

The foregoing discussion is not an exhaustive list of all factors considered
by the Global Crossing board of directors. Each member of the Global Crossing   
board of directors may have considered different factors, and the Global        
Crossing board of directors evaluated these factors as a whole and did not      
quantify or otherwise assign relative weights to factors considered.            

The determination of the Global Crossing board of directors involved        
judgments with respect to, among other things, future economic, competitive,    
regulatory and financial market conditions and future business decisions which  
may not be realized and are inherently subject to significant business,         
economic, competitive and regulatory uncertainties, all of which are difficult  
to predict and many of which are beyond the control of Global Crossing and will 
be beyond the control of Global Crossing after the merger. In deciding whether  
or not to approve the merger, shareholders of Global Crossing should not put    
undue reliance upon this information. This section contains "forward looking    
statements." See "Cautionary Statement Regarding Forward-Looking Statements" on 
page 31 and "Risk Factors" on page 23.                                          

Opinions of Global Crossing's financial advisors                                

On March 16, 1999, Salomon Smith Barney and Merrill Lynch delivered their   
oral opinions, subsequently confirmed in writing, to the Global Crossing board  
of directors to the effect that, as of that date, and based upon the            
assumptions made and matters considered as set forth in their opinions, the     
original exchange ratio was fair from a financial point of view to Global       
Crossing.                                                                       

On May 16, 1999, Salomon Smith Barney delivered its oral opinion,           
subsequently confirmed in writing, to the Global Crossing board of directors to 
the effect that, as of that date, the revised exchange ratio was fair from a    
financial point of view to Global Crossing. Merrill Lynch was not requested to  
deliver and did not deliver an opinion regarding the revised exchange ratio     
because it represented U S WEST in the negotiations of the proposed Global      
Crossing--U S WEST merger.                                                      

Opinions of Salomon Smith Barney                                              

We have attached as Annexes D-1 and D-2 to this document a copy of the      
written opinions of Salomon Smith Barney. Global Crossing shareholders are      
urged to read carefully Salomon Smith Barney's opinions in their entirety.      

In connection with rendering its opinions, Salomon Smith Barney reviewed    
publicly available information concerning Global Crossing and Frontier and      
other financial information concerning Global Crossing and Frontier, including  
financial forecasts and estimated cost savings and synergies resulting from the 
merger, that Global Crossing and Frontier provided to Salomon Smith Barney.     
Salomon Smith Barney discussed the past and current business operations,        
financial condition and prospects of Global Crossing and Frontier with certain  
officers and employees of Global Crossing and Frontier. Salomon Smith Barney    
also considered other information, financial studies, analyses, investigations  
and financial, economic and market criteria that it deemed relevant.            

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In its review and analysis and in arriving at its opinions, Salomon Smith   
Barney assumed and relied upon the accuracy and completeness of the information 
it reviewed, and Salomon Smith Barney did not assume any responsibility for     
independent verification of the information. Salomon Smith Barney assumed the   
financial forecasts of Global Crossing and Frontier were reasonably prepared on 
bases reflecting the best currently available estimates and judgments of the    
managements of Global Crossing and Frontier. Salomon Smith Barney expressed no  
opinion with respect to these forecasts or the assumptions on which they were   
based. Salomon Smith Barney also assumed that the merger will be consummated    
according to the terms of the merger agreement. Salomon Smith Barney did not    
make or obtain, or assume any responsibility for making or obtaining, any       
independent evaluation or appraisal of any of the assets or liabilities of      
Global Crossing or Frontier.                                                    

 Salomon Smith Barney's opinions are necessarily based upon conditions as they
existed and could be evaluated on the respective dates of the opinions. Salomon 
Smith Barney's opinions do not imply any conclusion as to the likely trading    
range for Global Crossing common stock following the completion of the merger,  
which may vary depending upon, among other factors, changes in interest rates,  
dividend rates, market conditions, general economic conditions and other        
factors that generally influence the price of securities. Salomon Smith         
Barney's opinions do not address Global Crossing's underlying business decision 
to effect the merger. Salomon Smith Barney expressed no view on the effect on   
Global Crossing of the merger and related transactions. Further, Salomon Smith  
Barney's opinions are directed only to the fairness, from a financial point of  
view, of the original exchange ratio and the revised exchange ratio,            
respectively to Global Crossing and are not a recommendation concerning how the 
holders of Global Crossing common stock should vote on the proposed issuance of 
shares of Global Crossing common stock in the merger or any related matter.     

 In an engagement letter dated December 5, 1998, Global Crossing agreed to pay
to Salomon Smith Barney: (a) a fee of $250,000, which was payable on the date   
of execution of the engagement letter; (b) a fee of $4,000,000, which was       
payable on the date of execution of an agreement in principle or definitive     
agreement to merge Global Crossing and Frontier; and (c) an additional fee of   
$20,000,000, which is payable at the closing if the merger is completed, minus  
the $4,250,000 previously received. Global Crossing also agreed to reimburse    
Salomon Smith Barney for all reasonable fees and disbursements of Salomon Smith 
Barney's counsel and all of Salomon Smith Barney's reasonable travel and other  
out-of-pocket expenses incurred in connection with the merger, or otherwise     
from Salomon Smith Barney's engagement. Global Crossing further agreed to       
indemnify Salomon Smith Barney and certain related persons against various      
liabilities, including liabilities under the federal securities laws, relating  
to or arising out of its engagement.                                            

In the past, Salomon Smith Barney has rendered investment banking and       
financial advisory services to Global Crossing and Frontier for which Salomon   
Smith Barney received customary compensation. In addition, in the ordinary      
course of its business, Salomon Smith Barney and its affiliates may actively    
trade the securities of Global Crossing and Frontier for its own account and    
the accounts of its customers and, accordingly, may at any time hold a long or  
short position in their securities. Salomon Smith Barney and its affiliates may 
have other business relationships with Global Crossing and Frontier and their   
respective affiliates.                                                          

Opinion of Merrill Lynch                                                      

We have attached as Annex E to this document a copy of the Merrill Lynch    
opinion dated March 16, 1999 with respect to the original exchange ratio, which 
sets forth the assumptions made, matters considered and certain limitations on  
the scope of review undertaken by Merrill Lynch. Each holder of common stock is 
urged to read the Merrill Lynch opinion in its entirety. The opinion was        
intended for the use and benefit of the Global Crossing board of directors, was 
directed only to the fairness from a financial point of view to Global Crossing 
of the original exchange ratio, did not address the merits of the underlying    
decision by Global Crossing to engage in the merger and does not constitute a   
recommendation to any shareholder as to how that shareholder should vote on the 
proposed issuance of Global Crossing common stock or any related matter. The    
exchange ratio was determined on the basis of negotiations between Global       
Crossing and Frontier and was approved by the Global Crossing board of          

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directors. The summary of the Merrill Lynch opinion set forth in this document  
is qualified in its entirety by reference to the full text of the opinion       
attached as Annex E. The Merrill Lynch opinion dated March 16, 1999 did not     
address the revised exchange ratio that was subsequently agreed to under the    
merger agreement. Merrill Lynch was not requested to deliver and did not        
deliver an opinion with respect to the revised exchange ratio because it        
represented U S WEST in the negotiations of the proposed Global Crossing--U S   
WEST merger.                                                                    

In arriving at its opinion, Merrill Lynch, among other things:              

 1. reviewed certain publicly available business and financial information
relating to Frontier and Global Crossing that Merrill Lynch deemed to be    
relevant;                                                                   

2. reviewed certain information, including financial forecasts, relating
to the business, earnings, cash flow, assets, liabilities and prospects of  
Frontier and Global Crossing, as well as the amount and timing of the cost  
savings and related expenses, including potential tax expenses, and         
synergies expected to result from the merger furnished to Merrill Lynch by  
Frontier and Global Crossing, respectively;                                 

3. conducted discussions with members of senior management and          
representatives of Frontier and Global Crossing concerning the matters      
described in clauses 1 and 2 above, as well as their respective businesses  
and prospects before and after giving effect to the merger and the expected 
synergies;                                                                  

 4. reviewed the market prices and valuation multiples for Frontier common
stock and Global Crossing common stock and compared them with those of      
certain publicly traded companies that Merrill Lynch deemed to be relevant; 

 5. reviewed the results of operations of Frontier and Global Crossing and
compared them with those of certain publicly traded companies that Merrill  
Lynch deemed to be relevant;                                                

 6. compared the proposed financial terms of the merger with the financial
terms of certain other transactions that Merrill Lynch deemed to be         
relevant;                                                                   

7. participated in certain discussions and negotiations among           
representatives of Frontier and Global Crossing and their financial and     
legal advisors;                                                             

8. reviewed the potential pro forma impact of the merger;               

9. reviewed the merger agreement; and                                   

10. reviewed such other financial studies and analyses and took into    
account other matters as Merrill Lynch deemed necessary, including Merrill  
Lynch's assessment of general economic, market and monetary conditions.     

In preparing its opinion, Merrill Lynch assumed and relied on the accuracy  
and completeness of all information supplied or otherwise made available to     
Merrill Lynch, discussed with or reviewed by or for Merrill Lynch, or publicly  
available. Merrill Lynch did not assume any responsibility for independently    
verifying such information or for undertaking an independent evaluation or      
appraisal of any of the assets or liabilities of Frontier or Global Crossing    
and was not furnished with any such evaluation or appraisal. In addition,       
Merrill Lynch did not assume any obligation to conduct any physical inspection  
of the properties or facilities of Frontier or Global Crossing. With respect to 
the financial forecast information and the expected synergies furnished to or   
discussed with Merrill Lynch by Frontier or Global Crossing, Merrill Lynch      
assumed that they were reasonably prepared and reflected the best currently     
available estimates and judgment of Frontier's or Global Crossing's management  
as to the expected future financial performance of Frontier or Global Crossing, 
as the case may be. Merrill Lynch further assumed that the merger will qualify  
as a tax-free reorganization for U.S. federal income tax purposes.              

The Merrill Lynch opinion was necessarily based upon market, economic and   
other conditions as they existed and could be evaluated on, and on the          
information made available to Merrill Lynch as of, the date of                  

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the Merrill Lynch opinion. Merrill Lynch assumed that in the course of          
obtaining the necessary regulatory or other consents or approvals, whether      
contractual or otherwise, for the merger, no restrictions, including any        
divestiture requirements or amendments or modifications, would be imposed that  
would have a material adverse effect on the contemplated benefits of the        
merger.                                                                         

In connection with the preparation of its opinion, Merrill Lynch was not    
authorized by Global Crossing or Global Crossing's board of directors to        
solicit, nor did Merrill Lynch solicit, third-party indications of interest for 
the acquisition of all or any part of Global Crossing. In addition, Merrill     
Lynch expressed no opinion as to the prices at which shares of Global Crossing  
common stock would trade following the announcement or consummation of the      
merger.                                                                         

Pursuant to the terms of a letter agreement between Global Crossing and     
Merrill Lynch dated March 9, 1999, Global Crossing has agreed to pay Merrill    
Lynch the following fees:                                                       

1. a fee of $4,250,000 upon the execution of the merger agreement and   

2. an additional fee of $20,000,000 payable upon consummation of the    
merger, against which the $4.25 million fee referenced above will be        
credited.                                                                   

 Global Crossing has also agreed to reimburse Merrill Lynch for its reasonable
out-of-pocket expenses, including the reasonable fees and disbursements of      
legal counsel, and to indemnify Merrill Lynch and certain related parties from  
and against certain liabilities, including liabilities under the federal        
securities laws, arising out of its engagement.                                 

Merrill Lynch has, in the past, provided financing services to Global       
Crossing, including serving as co-lead underwriter in connection with Global    
Crossing's initial public offering in August 1998, and provided financial       
advisory and financing services to Frontier, and may continue to do so and has  
received, and may receive, fees for the rendering of those services. In         
addition, in the ordinary course of Merrill Lynch's business, Merrill Lynch may 
actively trade Frontier shares and other securities of Frontier, as well as     
Global Crossing shares and other securities of Global Crossing, for its own     
account and for the accounts of its customers and, accordingly, may at any time 
hold a long or short position in these securities. As of March 16, 1999,        
certain affiliates of Merrill Lynch's Asset Management Group held in various    
funds approximately 4.3% of Frontier's common stock. Merrill Lynch also         
provided financial advisory services to U S WEST in connection with the         
proposed Global Crossing--U S WEST merger.                                      

Financial Analyses                                                            

The following is a summary of the material portions of the financial and    
comparative analyses performed by Salomon Smith Barney and Merrill Lynch which  
were jointly presented to Global Crossing's board of directors in connection    
with the opinions delivered to Global Crossing's board of directors on March    
16, 1999 with respect to the original exchange ratio.                           

Historical Stock Price Performance. Global Crossing's financial advisors    
reviewed the relationship between movements of the price of Frontier's common   
stock and the following long distance companies' common stock for the three-    
year period ending March 12, 1999:                                              

1. AT&T Corp.;                                                              

2. MCI Worldcom, Inc.;                                                      

3. Qwest Communications International Inc.; and                             

4. Sprint Corporation.                                                      

Global Crossing's financial advisors also reviewed the relationship between 
movements of the price of Frontier's common stock and the following local       
telephone companies' common stock for the three-year period ending March 12,    
1999:                                                                           

1. Aliant Communications Inc.;                                              

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2. ALLTEL Corporation;                                                      

3. Century Telephone Enterprises, Inc.;                                     

4. Cincinnati Bell Inc.;                                                    

5. Commonwealth Telephone Enterprises, Inc.; and                            

6. Telephone & Data Systems, Inc.                                           

Global Crossing's financial advisors also reviewed the relationship between 
movements of the price of Frontier's common stock and the S&P 500 for the       
three-year period ending March 12, 1999. Global Crossing's financial advisors   
noted that over this three-year period Frontier's common stock underperformed   
all the above listed companies' common stock and the S&P 500, with the          
underperformance becoming more dramatic in the last half of 1998.               

Implied Exchange Ratios. Global Crossing's financial advisors calculated a  
range of implied valuations for Frontier and Global Crossing by utilizing the   
following three principal valuation analyses:                                   

1. Comparable Public Company Analysis. A comparable public company      
analysis reviews a business' operating performance and outlook relative to  
a group of publicly traded peer companies to determine an implied           
unaffected market trading value.                                            

2. Comparable Transaction Analysis. A comparable transaction analysis   
provides a valuation range based upon financial information of companies    
which have been acquired in selected recent transactions and which are in   
the same or similar industries as the business being valued.                

3. Discounted Cash Flow Analysis. A discounted cash flow analysis       
provides insight into the intrinsic value of a business based on the        
projected earnings and capital requirements and the net present value of    
the subsequent cash flows anticipated to be generated by the assets of the  
business.                                                                   

Based on these analyses, Global Crossing's financial advisors calculated the
following implied exchange ratios:                                              

Comparable Public Company Valuation. The implied exchange ratio ranged from 
0.7029x to 2.0116x based upon a comparison of estimated comparable public       
company valuations and including estimated synergies (resulting primarily from  
the long distance and Internet/data services business segments). This range of  
implied exchange ratios was calculated by comparing the lowest estimated        
valuation of Frontier common stock to the highest estimated valuation of Global 
Crossing common stock and the highest estimated valuation of Frontier common    
stock to the lowest estimated valuation of Global Crossing common stock.        

Comparable Transaction/Discounted Cash Flow Valuation. The implied exchange 
ratio ranged from 0.8448x to 1.6267x based upon a comparison of Frontier's      
estimated comparable transaction valuation to Global Crossing's discounted cash 
flow valuations. This range of implied exchange ratios was calculated by        
comparing the lowest estimated valuation of Frontier common stock to the        
highest estimated valuation of Global Crossing common stock and the highest     
estimated valuation of Frontier common stock to the lowest estimated valuation  
of Global Crossing common stock.                                                

Discounted Cash Flow Valuation. The implied exchange ratio ranged from      
0.9129x to 1.9427x based upon a comparison of a valuation of Frontier which     
combined the discounted cash flow valuation of Frontier's local and integrated  
services business, which is comprised of the long distance telephony business   
and the Internet/data services business, with the public market valuation of    
Frontier's cellular business and excess fiber network, to the discounted cash   
flow valuation of Global Crossing, and including estimated synergies (resulting 
primarily from the long distance and Internet/data services business segments). 
This range of implied exchange ratios was calculated by comparing the lowest    
estimated valuation of Frontier common stock to the highest estimated valuation 
of Global Crossing common stock and the highest estimated valuation of Frontier 
common stock to the lowest estimated valuation of Global Crossing common stock. 

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In each case, the ranges of implied exchange ratios were compared to the    
original exchange ratio in the merger.                                          

Frontier Valuation                                                            

Global Crossing's financial advisors calculated estimated aggregate equity  
and per share equity valuation ranges for Frontier by separately analyzing and  
calculating the values of Frontier's main business segments, including the      
following:                                                                      

1. Long distance telephony;                                                 

2. Local telephony;                                                         

3. Cellular telephony;                                                      

4. Internet/data services; and                                              

5. Excess fiber network capacity.                                           

Based upon these analyses, which included a comparable public companies     
analysis, a comparable transaction analysis and a discounted cash flow          
analysis, including estimated synergies (resulting primarily from the long      
distance and Internet/data services business segments), and after subtracting   
estimated corporate overhead costs, Global Crossing's financial advisors        
calculated estimated aggregate equity valuations for Frontier which             
corresponded to estimated per share equity valuations for Frontier ranging from 
$40.00 to $75.76.                                                               

Frontier Long Distance Telephony Segment                                      

Using the analyses described below, Global Crossing's financial advisors    
calculated an estimated enterprise valuation for Frontier's long distance       
telephony business segment.                                                     

Comparable Public Companies Analysis. Global Crossing's financial advisors  
reviewed publicly available information to compare financial and operating      
information and multiples of firm value to 1999 estimated earnings before       
interest, taxes, depreciation and amortization, which is referred to as EBITDA, 
for Frontier's long distance telephony business segment with the corresponding  
financial and operating information and multiples for a group of publicly       
traded companies that Global Crossing's financial advisors deemed to be         
comparable to Frontier's long distance telephony business segment. Global       
Crossing's financial advisors determined the relevant range of these comparable 
public company multiples was 9.0x to 11.0x. The companies reviewed in this      
analysis included the following:                                                

1. AT&T Corp.;                                                              

2. IXC Communications, Inc.;                                                

3. Level 3 Communications, Inc.;                                            

4. MCI Worldcom, Inc.;                                                      

5. Qwest Communications International Inc.;                                 

6. Sprint Corporation; and                                                  

7. Tel-Save.com, Inc.                                                       

Comparable Transaction Analysis. Global Crossing's financial advisors       
reviewed publicly available information to compare the merger with business     
combinations in the long distance telephony industry that they deemed relevant. 
Global Crossing's financial advisors compared the transaction value, which was  
calculated as the offer value plus total debt plus the value of the acquiror's  
minority interest less cash and marketable securities, of each of these         
transactions to the forward EBITDA of the acquired company. Global Crossing's   
financial advisors determined the relevant range of these comparable            
transaction multiples was 11.0x to 13.0x. The transactions reviewed in this     
analysis included the following:                                                

1. EXCEL Communications, Inc./Telco Communications Group, Inc.;             

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2. Worldcom, Inc./MCI Communications Corporation;                           

3. Teleport Communications Group Inc./ACC Corp.;                            

4. Qwest Communications International Inc./LCI International, Inc.; and     

5. Teleglobe Inc./EXCEL Communications, Inc.                                

 Discounted Cash Flow Analysis. Global Crossing's financial advisors performed
a discounted cash flow analysis for Frontier's combined integrated services     
business segment, which includes the long distance telephony and Internet/data  
services segments, using Frontier management's projections. The discounted cash 
flow was calculated assuming discount rates ranging from 11.0% to 12.0% and was 
comprised of the sum of the present values of:                                  

1. the projected unlevered free cash flows for the years 1999 through 2003; 
and                                                                   

2. the 2003 terminal value based upon a range of multiples from 11.0x to    
12.0x estimated 2003 EBITDA.                                          

Frontier's Local Telephony Business Segment                                   

Using the analyses described below, Global Crossing's financial advisors    
calculated an estimated enterprise valuation for Frontier's local telephony     
business segment.                                                               

Comparable Public Companies Analysis. Global Crossing's financial advisors  
reviewed publicly available information to compare financial and operating      
information and multiples of firm value to 1999 estimated EBITDA for Frontier's 
local telephony business segment with the corresponding financial and operating 
information and multiples for the local telephony business segments of a group  
of publicly traded companies that Global Crossing's financial advisors deemed   
to be comparable to Frontier's local telephony business segment. Global         
Crossing's financial advisors determined the relevant range of these public     
company multiples was 9.0x to 10.0x. The companies reviewed in this analysis    
included the following:                                                         

1. Aliant Communications Inc.;                                              

2. ALLTEL Corporation;                                                      

3. Ameritech Corporation;                                                   

4. Bell Atlantic Corporation;                                               

5. BellSouth Corporation;                                                   

6. Century Telephone Enterprises, Inc.;                                     

7. Cincinnati Bell Inc.;                                                    

8. Commonwealth Telephone Enterprises, Inc.;                                

9. GTE Corporation;                                                         

10. SBC Communications Inc.;                                                

11. Telephone & Data Systems, Inc.; and                                     

12. U S WEST, Inc.                                                          

Comparable Transaction Analysis. Global Crossing's financial advisors       
reviewed publicly available information to compare the merger with business     
combinations in the local telephony industry that they deemed relevant. Global  
Crossing's financial advisors compared the transaction value of each of these   
transactions to the forward EBITDA of the acquired company. Global Crossing's   
financial advisors determined the relevant range of these comparable            
transaction multiples was 9.0x to 10.0x. These transactions included the        
following:                                                                      

1. ALLTEL Corporation/Aliant Communications Inc.;                           

2. ALLTEL Corporation/GTE Corporation;                                      

3. Ameritech Corporation/Sprint Corporation;                                

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4. Bell Atlantic Corporation/GTE Corporation;                               

5. Bell Atlantic Corporation/NYNEX Corporation;                             

6. Century Telephone Enterprises, Inc./Ameritech Corporation (Wisconsin     
access lines);                                                        

7. Century Telephone Enterprises, Inc./Centel Corporation (Central          
Telephone Company of Ohio);                                           

8. Century Telephone Enterprises, Inc./Pacific Telecom Inc.;                

9. Citizens Utilities Company/ALLTEL Corporation;                           

10. Citizens Utilities Company/GTE Corporation;                             

11. Conestoga Enterprises, Inc./Buffalo Valley Telephone Company;           

12. Gallatin River Communications, LLC/Sprint Corporation (Illinois access  
lines);                                                             

13. GTE Corporation/Centel Corporation;                                     

14. PacifiCorp/Pacific Telecom Inc.;                                        

15. Rochester Telephone Corporation/Centel Corporation (Iowa and Minnesota  
access lines);                                                      

16. SBC Communications Inc./Ameritech Corporation;                          

17. SBC Communications Inc./Pacific Telesis Group;                          

18. SBC Communications Inc./The Southern New England Telephone Company;     

19. The Southern New England Telephone Company/The Woodbury Telephone       
Company; and                                                        

20. Sprint Corporation/Centel Corporation.                                  

 Discounted Cash Flow Analysis. Global Crossing's financial advisors performed
a discounted cash flow analysis for Frontier's local telephony business segment 
using Frontier management's projections. The discounted cash flow was           
calculated assuming discount rates ranging from 9.0% to 10.0% and was comprised 
of the sum of the present values of:                                            

1. the projected unlevered free cash flows for the years 1999 though    
2003; and                                                                   

2. the 2003 terminal value based upon a range of multiples from 9.0x to 
10.0x estimated 2003 EBITDA.                                                

Frontier's Cellular Business Segment                                          

Global Crossing's financial advisors calculated an estimated enterprise     
valuation for Frontier's cellular telephony business segment of approximately   
$175 per person in each of Frontier's cellular service areas based on           
information supplied by Frontier's management.                                  

Frontier's Internet/Data Business Segment                                     

Comparable Public Companies Analysis. Global Crossing's financial advisors  
reviewed publicly available information to compare certain financial and        
operating information and multiples of firm value to 1999 estimated revenue for 
Frontier's Internet/data services business segment with the corresponding       
financial and operating information and multiples for a group of publicly       
traded companies that Global Crossing's financial advisors deemed to be         
comparable to Frontier's Internet/data services business segment. Global        
Crossing's financial advisors determined the relevant range of these comparable 
public company multiples was 9.0x to 13.0x. The companies reviewed in this      
analysis included the following internet service providers:                     

1. Concentric Network Corporation;                                          

2. Earthlink Network, Incorporated;                                         

3. Globix Corporation;                                                      

4. Mindspring Enterprises, Inc.;                                            

5. Network Solutions, Inc.;                                                 

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6. PSINet, Inc.;                                                            

7. Rocky Mountain Internet, Inc.; and                                       

8. Verio Inc.                                                               

The companies reviewed in this analysis also included the following data    
service providers:                                                              

1. Equant, N.V.;                                                            

2. Exodus Communications, Inc.;                                             

3. AboveNet Communications, Inc.; and                                       

4. Covad Communications Group, Inc.                                         

Frontier's Excess Fiber Network                                               

Global Crossing's financial advisors calculated an estimated valuation for  
Frontier's excess fiber network business segment by comparing this business     
segment with companies that Global Crossing's financial advisors deemed         
relevant. The companies reviewed in this analysis included the following:       

1. IXC Communications, Inc.;                                                

2. Level 3 Communications, Inc.; and                                        

3. Qwest Communications International Inc.                                  

Using this analysis, Global Crossing's financial advisors calculated an     
estimated valuation of Frontier's excess fiber network ranging from $5,000 to   
$10,000 per excess strand mile.                                                 

Global Crossing Valuation                                                     

Global Crossing's financial advisors calculated estimated aggregate equity  
and per share equity valuation ranges for Global Crossing by utilizing a        
comparable public company analysis and a discounted cash flow analysis. Based   
upon these analyses, Global Crossing's financial advisors calculated estimated  
aggregate fully diluted equity valuations for Global Crossing which             
corresponded to estimated per share equity valuations for Global Crossing       
ranging from $35.00 to $60.00.                                                  

Comparable Public Companies Analysis. Global Crossing's financial advisors  
reviewed publicly available information to compare financial and operating      
information and multiples of 1999-2001 estimated EBITDA to the compound annual  
growth rate in estimated EBITDA over the respective periods from 1999 through   
2001 and 1999 through 2003 for Global Crossing with the corresponding financial 
and operating information and multiples for a group of publicly traded          
companies that Global Crossing's financial advisors deemed to be comparable to  
Global Crossing. Global Crossing's financial advisors determined the relevant   
range of these comparable public company multiples was .45x to .90x. The        
companies reviewed in this analysis included the following:                     

1. AT&T Corp.;                                                              

2. Equant, N.V.;                                                            

3. Frontier Corporation;                                                    

4. IXC Communications, Inc.;                                                

5. MCI Worldcom, Inc.;                                                      

6. Metromedia Fiber Network, Inc.;                                          

7. Qwest Communications International Inc.; and                             

8. Sprint Corporation.                                                      

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Using this range of multiples, Global Crossing's financial advisors         
calculated an implied per share equity valuation for Global Crossing ranging    
from $35.00 to $60.00.                                                          

 Discounted Cash Flow Analysis. Global Crossing's financial advisors performed
a discounted cash flow analysis for Global Crossing using Global Crossing       
management's projections. The discounted cash flow was calculated assuming      
weighted average cost of capital rates ranging from 11.0% to 13.0% and was      
comprised of the sum of the present values of the following:                    

1. the projected unlevered free cash flows for the years 1999 through 2008; 
and                                                                   

2. the 2008 terminal value based upon a range of multiples from 7.0x to     
9.0x estimated 2008 EBITDA.                                           

Using this analysis, Global Crossing's financial advisors calculated an     
implied per share equity valuation for Global Crossing ranging from $39.00 to   
$55.00.                                                                         

Pro Forma Combination Analysis                                                

Pro Forma Stock Ownership Analysis. Global Crossing's financial advisors    
reviewed the original exchange ratio and the number of shares of Global         
Crossing's common stock to be issued to holders of Frontier common stock based  
upon the original base exchange ratio of 1.2557x. This analysis indicated that  
current shareholders of Frontier would own approximately 33% of Global          
Crossing's common stock after the merger.                                       

The summary set forth above does not purport to be a complete description of
the analyses performed by Global Crossing's financial advisors in arriving at   
their respective opinions. The preparation of a fairness opinion is a complex   
process and is not necessarily susceptible to partial or summary description.   
Global Crossing's financial advisors believe that their analyses must be        
considered as a whole and that selecting portions of their analyses and the     
factors considered by them, without considering all their factors and analyses, 
could create a misleading view of the process underlying the analyses set forth 
in their respective opinions. Global Crossing's financial advisors did not      
assign relative weights to any of their analyses in preparing their respective  
opinions. The matters considered by Global Crossing's financial advisors in     
their analyses were based on numerous macroeconomic, operating and financial    
assumptions with respect to industry performance, general business and economic 
conditions and other matters, many of which are beyond Global Crossing's and    
Global Crossing's financial advisors' control and involve the application of    
complex methodologies and educated judgment. Any estimates contained in Global  
Crossing's financial advisors' analyses are not necessarily indicative of       
actual past or future results or values, which may be significantly more or     
less favorable than the estimates. Estimated values do not purport to be        
appraisals and do not necessarily reflect the prices at which businesses or     
companies may be sold in the future, and the estimates are inherently subject   
to uncertainty.                                                                 

No company utilized as a comparison in the analyses described above is      
identical to Frontier or Global Crossing. Also, no transaction utilized in the  
analyses described above is identical to the merger of Frontier and Global      
Crossing. In addition, various analyses performed by Global Crossing's          
financial advisors incorporate projections prepared by research analysts using  
only publicly available information. These estimates may or may not prove to be 
accurate. An analysis of comparable transactions and publicly traded comparable 
companies is not mathematical; rather it involves complex considerations and    
judgments concerning differences in financial and operating characteristics of  
the comparable companies and other factors that could affect the public trading 
value of the comparable companies or company to which they are being compared.  

The Global Crossing board of directors selected Salomon Smith Barney and    
Merrill Lynch to act as its financial advisors because of their reputations as  
internationally recognized investment banking firms with substantial experience 
in transactions similar to the merger and because they are familiar with Global 
Crossing and its business. The Global Crossing board of directors did not       
impose any limitations on the investigation made or the procedures followed by  
Salomon Smith Barney and Merrill Lynch in rendering their opinions. As part of  
their respective investment banking businesses, Salomon Smith Barney and        
Merrill Lynch are                                                               

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continually engaged in the valuation of businesses and their securities in      
connection with mergers and acquisitions, leveraged buyouts, negotiated         
underwritings, competitive biddings, secondary distributions of listed and      
unlisted securities, private placements and other purposes.                     

Recommendation of the Frontier board of directors; Reasons for the merger       

The board of directors of Frontier believes that the merger offers the      
Frontier shareholders an opportunity to receive significant value for their     
shares of Frontier common stock and to participate in a combined organization   
that will be a larger, more diversified company in the Internet and             
telecommunications industry and that will be well-positioned to compete         
effectively in that industry. The Frontier board of directors has carefully     
considered the terms of the proposed merger and has determined that the merger  
and the merger agreement are fair to, and in the best interests of, Frontier    
and the Frontier shareholders, has adopted the merger agreement and approved    
the merger and the other transactions contemplated by the merger agreement and  
recommends that the Frontier shareholders vote FOR the adoption of the merger   
agreement.                                                                      

In reaching its decision, the Frontier board of directors consulted with its
financial and legal advisors and with senior management and considered a number 
of factors, including, without limitation, the following material factors:      

1. the information and presentations by management of Frontier and its      
  financial advisor concerning Frontier's and Global Crossing's respective
businesses, assets, management, competitive position and prospects,   

2. the financial condition, cash flows and results of operations of         
Frontier and Global Crossing, both on a historical and prospective    
basis,                                                                

3. the original exchange ratio negotiated with Global Crossing, including   
the related collar provision which gives Frontier shareholders the    
  opportunity to participate in the increased value of the Global Crossing
common stock if the value of the stock increases above $56.7813 and   
  which gave Frontier the ability to terminate the merger agreement if the
value of the Global Crossing common stock to be received by Frontier  
 shareholders is less than $62.00 (following the amendment to the merger
  agreement, $63.00 per share) during the measurement period, based on the
average trading price,                                                

4. the opportunity for Frontier shareholders to receive Global Crossing     
common stock, based on the original $62.00 deal value, valued at a    
significant premium to the recent market price of the Frontier common 
stock (39% over the closing price on March 16, 1999, the last trading 
day before public announcement of the merger agreement, 67% over the  
closing price on March 9, 1999, one week before public announcement of
the merger agreement and 80% over the closing price on February 16,   
1999, one month before public announcement of the merger agreement),  

5. the opportunity for the Frontier shareholders to participate, as holders 
of Global Crossing common stock, in a larger, more diversified,       
competitive company in the Internet and telecommunications industry,  
including participation in the value that may be generated through the
combination of the two companies,                                     

6. the fact that the overlap of the markets, capital investment and         
personnel of Frontier and Global Crossing would allow the combined    
company to focus on new technology and growth in markets,             

7. the opportunity for the facilities of Global Crossing and Frontier to be 
seamlessly integrated,                                                

8. the strategic and financial alternatives available to Frontier in the    
rapidly changing industry environment, including remaining an         
independent company,                                                  

9. the written opinion of Morgan Stanley & Co. Incorporated that, subject   
to the assumptions and limitations set forth in the opinion, the      
original exchange ratio was fair from a financial point of view to the
holders of Frontier common stock, other than Global Crossing and its  
 affiliates, and the financial presentation made by Morgan Stanley & Co.
Incorporated to the Frontier board of directors in connection with the
delivery of its opinion,                                              

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10. the absence of any other firm proposal to engage in a business          
   combination involving Frontier at the time of the board meeting despite
 various contacts between third parties and Morgan Stanley and members
of senior management of Frontier,                                   

11. the ability of Frontier, subject to specified conditions, (a) to        
provide information to, and negotiate with, a third party which has 
made an unsolicited acquisition proposal and (b) to terminate the   
   merger agreement if the Frontier board of directors approves a superior
proposal, subject to the payment of a termination fee in an amount  
which the Frontier board of directors and its financial advisor     
 believed would not meaningfully impair the possibility of a competing
transaction,                                                        

12. the other terms and conditions of the original merger agreement,        
 including (a) the limited number of closing conditions which provides
  increased certainty that the merger will be completed and (b) the fact
  that Global Crossing must close the merger without regard to its stock
 price, while, as noted in 3. above, Frontier may, but is not required
to, terminate the merger if the average price of the Global Crossing
 common stock during a period shortly before closing is below $34.5625
   unless Global Crossing elects to increase the consideration to Frontier
shareholders so that they will receive total consideration valued at
$62.00 per share (following the amendment to the merger agreement,  
$63.00 per share), based on that average price,                     

13. the fact that the merger is intended to be a tax-free exchange to       
Frontier shareholders,                                              

14. the fact that Frontier will be able to designate four directors to the  
   Global Crossing board of directors at the time of the merger and Global
Crossing is required to take all action necessary to elect Joseph   
Clayton as a Vice Chairman of Global Crossing and Rolla Huff as     
 President and Chief Operating Officer of North American Operations of
Global Crossing following the merger,                               

15. the terms and conditions of the stock option agreement,                 

16. the existence and terms of the agreement of holders of at least 51% of  
Global Crossing common stock to vote in favor of the Global Crossing
merger proposals,                                                   

17. historical market prices and trading information with respect to the    
Frontier common stock and the Global Crossing common stock, and     

18. current industry, economic and market conditions.                       

The discussion of the information and factors considered by the Frontier    
board of directors is not intended to be exhaustive. In view of the variety of  
material factors considered in connection with its evaluation of the merger,    
the Frontier board of directors did not find it practicable to, and did not     
quantify or otherwise assign relative weights to, the specific factors          
considered in reaching its determination. In addition, individual members of    
the Frontier board of directors may have given different weights to different   
factors. For a discussion of the interests of some members of Frontier's        
management and the Frontier board of directors, see "The Merger--Interests of   
members of Frontier's board of directors and management in the merger."         

Opinion of Frontier's financial advisor                                         

Under a letter agreement dated January 6, 1999, Frontier retained Morgan    
Stanley to provide financial advisory services to Frontier. On March 16, 1999,  
Morgan Stanley delivered its opinion to the Frontier board of directors that,   
as of such date and based upon and subject to the various considerations in the 
opinion, the original exchange ratio pursuant to the merger agreement was fair  
from a financial point of view to holders of shares of Frontier common stock,   
other than Global Crossing and its affiliates. On May 16, 1999, in connection   
with the approval of the consent and amendment to the merger agreement, Morgan  
Stanley delivered its opinion to the Frontier board of directors that, as of    
such date and based upon and subject to the various considerations in the       
opinion, the exchange ratio pursuant to the merger agreement was fair from a    
financial point of view to holders of shares of Frontier common stock, other    
than Global Crossing and its affiliates. The opinion delivered on March 16,     
1999 was substantially the same as the May 16, 1999 opinion. In connection with 
the opinion delivered on May 16, 1999, Morgan Stanley reviewed certain          
information regarding U S WEST, which had entered into a merger agreement with  
Global Crossing on that date, as described below.                               

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On July 18, 1999, U S WEST and Global Crossing agreed to terminate that merger  
agreement. Morgan Stanley's opinion delivered on May 16, 1999--that as of such  
date and based upon and subject to the various considerations in the opinion,   
the exchange ratio pursuant to the merger agreement was fair from a financial   
point of view to the holders of shares of the Frontier common stock, other than 
Global Crossing and its affiliates--was not contingent on the consummation of   
the Global Crossing--U S WEST merger.                                           

We have attached as Annex F to this document the full text of the opinion   
dated May 16, 1999, which describes assumptions made, procedures followed,      
matters considered and limitations on the scope of the review undertaken by     
Morgan Stanley in rendering its opinion. Morgan Stanley's written opinion is    
directed to the Frontier board of directors and only addresses the fairness of  
the exchange ratio pursuant to the merger agreement from a financial point of   
view to holders of shares of Frontier common stock, other than Global Crossing  
and its affiliates, as of the date of the opinion. Morgan Stanley's written     
opinion does not address any other aspect of the merger and does not constitute 
a recommendation to any Frontier shareholder as to how to vote at the Frontier  
special meeting. The following is only a summary of the Morgan Stanley opinion  
and should not be viewed as a substitute for the Morgan Stanley opinion.        
Frontier shareholders are urged to read the entire opinion.                     

In arriving at its opinions, Morgan Stanley, among other things:            

.  reviewed certain publicly available financial statements and other       
information of Frontier, Global Crossing and U S WEST,                

.  reviewed certain internal financial statements and other financial and   
operating data concerning Frontier, Global Crossing and U S WEST      
prepared by the managements of Frontier, Global Crossing and U S WEST,
respectively,                                                         

.  analyzed certain financial projections for Frontier, Global Crossing and 
 U S WEST prepared by the managements of Frontier, Global Crossing and U
S WEST, respectively,                                                 

.  reviewed certain reports prepared by consultants retained by Global      
Crossing with respect to demand forecasts for certain markets in which
Global Crossing currently intends to operate and held discussions     
regarding such forecasts with one of these consultants,               

.  analyzed certain financial projections for Frontier contained in certain 
securities analysts' research reports that were recommended for review
by the management of Frontier,                                        

.  discussed the past and current operations and financial condition and    
the prospects of Frontier, including information relating to certain  
strategic, financial and operational benefits anticipated from the    
merger, or, if applicable the alternative merger, with the senior     
executives of Frontier,                                               

.  discussed the past and current operations and financial condition and    
the prospects of Global Crossing, including information relating to   
certain strategic, financial and operational benefits anticipated from
 the merger, or, if applicable the alternative merger, and the proposed,
and subsequently terminated, Global Crossing-U S WEST merger with the 
senior executives of Global Crossing,                                 

.  discussed the past and current operations and financial condition and    
the prospects of U S WEST, including information relating to certain  
strategic, financial and operational benefits anticipated from the    
merger or, if applicable, the alternative merger, and the U S WEST    
merger with certain senior executives of U S WEST,                    

.  reviewed the pro forma impact of the merger or, if applicable the        
alternative merger, on Global Crossing's cash flow, consolidated      
capitalization and financial ratios,                                  

.  reviewed the reported prices and trading activity for the Frontier       
common stock, the Global Crossing common stock and the U S WEST common
stock,                                                                

.  compared the financial performance of Frontier and Global Crossing and   
the prices and trading activity of the Frontier common stock and the  
Global Crossing common stock with those of certain other comparable   
publicly-traded companies and their securities,                       

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.  compared the prices and trading activity of U S WEST common stock with   
those of certain other comparable publicly-traded companies and their 
securities,                                                           

.  reviewed the financial terms, to the extent publicly available, of       
certain transactions comparable to the merger,                        

.  participated in discussions and negotiations among representatives of    
Frontier and Global Crossing and their financial and legal advisors in
connection with the merger,                                           

.  discussed certain tax issues with senior executives of Frontier and      
Global Crossing and with Frontier's legal and tax advisors,           

.  reviewed the merger agreement, the Global Crossing--U S WEST merger      
agreement and certain related documents, and                          

.  performed such other analyses and considered such other factors as       
deemed appropriate.                                                   

 Morgan Stanley assumed and relied upon, without independent verification, the
accuracy and completeness of the information reviewed by it for purposes of its 
opinions. With respect to the financial and other operating data and            
discussions relating to the strategic, financial and operational benefits       
anticipated from the respective transactions, Morgan Stanley assumed that such  
financial and operating data were reasonably prepared on bases reflecting the   
best currently available estimates and judgments of the future operating and    
financial performance of Frontier and Global Crossing. Morgan Stanley relied    
upon the financial projections for Frontier included in the securities          
analysts' research reports reviewed by Morgan Stanley based on its own          
independent evaluation of these reports and indications by management of        
Frontier that the analyses contained in these reports were reasonably           
comprehensive and detailed and were based on assumptions about the trends       
influencing Frontier's financial results that were generally consistent with    
the assumptions of Frontier's management. Morgan Stanley did not make any       
independent valuation or appraisal of the assets or liabilities of Frontier,    
nor was Morgan Stanley furnished with any appraisals.                           

Morgan Stanley further assumed with Frontier's consent that, except as      
provided below, the transactions contemplated by the merger agreement,          
including the merger or, if applicable, the alternative merger, will be         
consummated on the terms set forth in the merger agreement, including, among    
other things, that the merger or, if applicable, the alternative merger will be 
treated as a tax-free reorganization or, if applicable, exchange pursuant to    
the Internal Revenue Code. In addition, with the consent of Frontier, Morgan    
Stanley relied upon the advice of legal and tax advisors of Frontier as to      
certain tax matters relating to the alternative merger. Morgan Stanley's        
opinion does not address the impact, if any, of a determination by Frontier not 
to exercise its termination rights pursuant to Section 7.1(g) of the merger     
agreement, which relates to termination by Frontier if the average Global       
Crossing trading price is below $34.5625. In addition, Morgan Stanley assumed   
that in connection with the receipt of all necessary regulatory approvals for   
the merger or, if applicable, the alternative merger, no restrictions will be   
imposed that would have a material adverse effect on Frontier, Global Crossing  
or the contemplated benefits expected to be derived in the merger or, if        
applicable, the alternative merger. Morgan Stanley's opinions were necessarily  
based on economic, market and other conditions as in effect on, and the         
information made available to it as of, the dates of the opinions.              

The following is a summary of the material financial analyses performed by  
Morgan Stanley in preparing its opinions to the Frontier board of directors on  
March 16, 1999 and May 16, 1999. Certain of these summaries of financial        
analyses include information presented in tabular format. In order to fully     
understand the financial analyses used by Morgan Stanley, the tables must be    
read together with the text of each summary. The tables alone do not represent  
a complete description of the financial analyses. Morgan Stanley used financial 
estimates for Frontier that were based on estimates published by securities     
research analysts in the investment community in performing some of its         
analyses. Morgan Stanley used financial estimates for Global Crossing that were 
provided by Global Crossing management.                                         

Historical Public Market Trading Value. Morgan Stanley reviewed the recent  
stock price performance of Frontier based on an analysis of the historical      
closing prices and trading volumes during the period from March                 

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12, 1998 through March 12, 1999. The following table summarizes the price       
performance of Frontier's common stock over that period:                        

                                                                [Download Table]

                                                          Historical Frontier
                                                          Common Stock Prices
                                                          -------------------
                                                                             
March 12, 1999...........................................       $ 40.63      
High Price...............................................       $ 40.63      
Low Price................................................       $ 24.00      
Average Price............................................       $ 33.00      
Average Daily Trading Volume (8/14/98-3/15/99)...........       646,000      

Morgan Stanley also reviewed the recent stock price performance of Global   
Crossing based on an analysis of the historical closing prices and trading      
volumes during the period from the Global Crossing initial public offering on   
August 14, 1998, through March 15, 1999 and through May 14, 1999. The following 
table summarizes the price performance of Global Crossing's common stock over   
that period:                                                                    

                                                                [Download Table]

                                                  Historical Global Crossing
                                                     Common Stock Prices    
                                                  --------------------------
                                                                            
May 14, 1999.....................................         $   62.29         
March 15, 1999...................................         $   56.56         
High Price.......................................         $   64.25         
Low Price........................................         $    8.00         
Average Daily Trading Volume (8/14/98-3/15/99)...         1,338,000         

Comparative Stock Price Performance. As part of its analysis, Morgan Stanley
reviewed the recent stock price performance of Frontier and compared this       
performance with that of groups of the following five competitive               
telecommunications infrastructure companies, three long distance companies,     
five local exchange companies and Qwest on a stand-alone basis.                 

                                                                [Download Table]

  Competitive                                                                    
Infrastructure                                                                   
   Companies     Long Distance Companies         Local Exchange Companies        
--------------   ----------------------- ----------------------------------------
                                                                                 
Global Crossing    AT&T Corp.            Aliant Communications Inc.              
 Ltd.                                                                            
GTS                MCI WorldCom, Inc.    ALLTEL Corporation                      
IXC Communica-     Sprint Corporation    Century Telephone Enterprises, Inc.     
 tions, Inc.                                                                     
Level 3 Commu-                           Cincinnati Bell Inc.                    
 nications,                                                                      
 Inc.                                                                            
Qwest                                    Commonwealth Telephone Enterprises, Inc.
 Communications                                                                  
 International                                                                   
 Inc.                                                                            

Morgan Stanley observed that over the period from March 12, 1998, to March  
12, 1999, the closing market prices appreciated as set forth below:             

                                                                [Download Table]

                                                             % Appreciation
                                                             --------------
                                                                           
Frontier....................................................      37.4%    
Five Competitive Infrastructure Companies (equal-weighted                  
 index).....................................................     124.9%    
Three Long Distance Companies (equal-weighted index)........      57.2%    
Five Local Exchange Companies (equal-weighted index)........      34.1%    
Qwest.......................................................      78.8%    

Morgan Stanley also reviewed the recent stock price performance of Global   
Crossing and compared this performance with that of a group of comparable       
companies. Morgan Stanley observed that over the period from Global Crossing's  
initial public offering on August 14, 1998, to March 12, 1999, the closing      
market prices appreciated as set forth below:                                   

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                                                                [Download Table]

Global Crossing and Comparative Companies                      % Appreciation
-----------------------------------------                      --------------
                                                                             
Global Crossing...............................................     287.3%    
Allegiance....................................................     147.7%    
Qwest.........................................................      82.9%    
MCI WorldCom..................................................      71.2%    
Level 3.......................................................      63.8%    
Equant........................................................      50.4%    
Colt..........................................................      43.7%    

 Morgan Stanley also observed that over the period from August 14, 1998 to May
14, 1999, the closing price of Global Crossing common stock appreciated 381.4%, 
as compared to 80.9% for an index of peer companies (composed of MCI WorldCom,  
Qwest, Level 3 and IXC) and 25.9% for the S&P 500 index.                        

Securities Research Analysts' Future Price Targets. Morgan Stanley reviewed 
and analyzed future public market trading price targets for Frontier common     
stock prepared and published by a number of securities research analysts during 
the periods from July 24, 1998 to January 25, 1999, before the announcement by  
Frontier of its intention to reduce its dividend on January 26, 1999, and from  
January 26, 1999 to March 12, 1999, after the dividend announcement. Morgan     
Stanley also reviewed and analyzed future public market trading price targets   
for Global Crossing common stock both at the time after Global Crossing's       
August 14, 1998 initial public offering and during the period from December 1,  
1998 to March 12, 1999 and from March 18, 1999 to May 14, 1999. These targets   
reflected each analyst's estimate of the future public market trading price of  
Frontier and Global Crossing common stock at the end of the particular time     
period considered for each time estimate. Morgan Stanley discounted, at a cost  
of equity rate of 11.1%, each Frontier research analyst's public market price   
target to March 16, 1999. Morgan Stanley also reviewed and analyzed the future  
private market value targets for Frontier common stock prepared and published   
by certain securities research analysts in the period from July 31, 1998 to     
March 12, 1999, reflecting each analyst's estimate of the future private market 
value of Frontier common stock at the end of the time period considered in such 
estimate.                                                                       

                                                                [Download Table]

                                                                Value Range 
                                                                ------------
                                                                 Low   High 
                                                                ----- ------
                                                                            
Present Value of Frontier Public Market Price Target (1/26/99-              
 3/12/99)...................................................... $  37 $  41 
Present Value of Frontier Public Market Price Target (7/24/98-              
 1/25/99)......................................................    25    51 
Frontier Private Market Value Target...........................    40    59 
Present Value of Global Crossing Public Market Price Target                 
 (3/18/99-5/14/99).............................................    57    81 
Global Crossing Public Market Price Target (12/1/98-3/12/99)...    35    35 
Global Crossing Public Market Price Target at IPO..............    14    15 

 Morgan Stanley noted that certain securities analysts had their public market
price target for Global Crossing common stock under review as of March 12,      
1999.                                                                           

Morgan Stanley also noted that the public market trading price and private  
market value targets published by the securities research analysts do not       
reflect current market trading prices and private market value targets for      
Frontier or Global Crossing common stock and that these estimate are subject to 
uncertainties, including the future financial performance of Frontier and       
Global Crossing and future financial market conditions.                         

Peer Group Comparison. Morgan Stanley reviewed and analyzed the financial   
information of four local exchange companies, an index of four Regional Bell    
Operating Companies, and three competitive long distance and telecommunications 
infrastructure companies to arrive at a sum-of-the parts value for Frontier     
based on the implied theoretical public market trading values for Frontier's    
integrated services and local exchange business segments.                       

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Morgan Stanley derived a theoretical value for Frontier's local exchange    
business segment based on the financial information for the four local exchange 
companies and for an average of the four Regional Bell Operating Companies,     
which are Bell Atlantic, BellSouth, SBC, and U S WEST. Morgan Stanley analyzed, 
among other things, the current aggregate value, which means equity value       
adjusted for capital structure, of each company expressed as a multiple of      
earnings before interest, taxes, and depreciation and amortization expense,     
which we refer to as "EBITDA," and the current public market price of each      
company expressed as a multiple of its earnings per share, which we refer to as 
"EPS." As of March 12, 1999 and based on estimates of EBITDA and EPS taken from 
selected securities research analysts, the statistics derived from this         
analysis are set forth below.                                                   

                                                                [Download Table]

                                                                   Regional Bell
                                                                     Operating  
                                   Cincinnati                         Company   
                            ALLTEL    Bell    Commonwealth Century    Average   
                            ------ ---------- ------------ ------- -------------
                                                                                
1999 EBITDA Multiple.......  8.9x     9.8x       10.9x      10.7x       8.0x    
Price/1999E EPS............ 22.9x    25.3x          NM      28.2x      20.6x    

NM = not meaningful                                                             

 Morgan Stanley derived a theoretical value for Frontier's Integrated Services
Business Segment based on the financial information for the three competitive   
long distance and infrastructure telecommunications companies. Morgan Stanley   
analyzed, among other things, the current aggregate value, which means equity   
value adjusted for capital structure, of each company expressed as a multiple   
of revenues and as a multiple of EBITDA, and the ratio of the multiple of       
current aggregate value to estimated EBITDA in the calendar year 1999 to the    
estimated, long-term EBITDA growth rate. As of March 12, 1999 and based on      
estimates of revenue, EBITDA and long-term EBITDA growth rates taken from       
selected securities research analysts, the statistics derived from this         
analysis are set forth below.                                                   

                                                                [Download Table]

                                                                MCI         
                                                         IXC  WorldCom Qwest
                                                        ----- -------- -----
                                                                            
1999 Revenue Multiple..................................  2.0x   4.7x    7.5x
1999 EBITDA Multiple................................... 12.4x  14.6x   34.7x
EBITDA Multiple Growth................................. 0.42x  0.89x   1.21x

Based on peer group comparisons and the corresponding implied value of      
Frontier's local exchange company and Integrated Services business segments,    
Morgan Stanley derived a theoretical sum-of-the-parts value range for Frontier  
of $42 to $46 per share.                                                        

Morgan Stanley also reviewed and analyzed the financial information of seven
competitive long distance and telecommunications infrastructure companies and   
compared the results to financial information relating to Global Crossing.      
Morgan Stanley analyzed, among other things, the current aggregate value of     
each company expressed as a multiple of revenues and as a multiple of EBITDA,   
and the ratio of the multiple of current aggregate value to estimated EBITDA in 
the calendar year 1999 to the estimated, long-term EBITDA growth rate. As of    
March 12, 1999 and based on estimates of revenue, EBITDA and long-term EBITDA   
growth rates taken from selected securities research analysts, the statistics   
derived from this analysis are set forth below.                                 

                                                        [Enlarge/Download Table]

                                                                                     Global      Global    
                                                                                   Crossing/    Crossing/  
                                                             MCI           Global   Frontier    Frontier   
                          Colt  Equant  GTS   IXC  Level 3 WorldCom Qwest Crossing (with LEC) (without LEC)
                         ------ ------ ----- ----- ------- -------- ----- -------- ---------- -------------
                                                                                                           
1999 Revenue Multiple...  16.8x 14.6x   6.3x  2.0x  41.6x    4.7x    7.5x  28.2x      9.5x        10.6x    
2000 Revenue Multiple...  10.5x 11.0x   3.7x  1.8x  24.0x    4.1x    6.1x  17.8x      7.6x         8.1x    
1999 EBITDA Multiple....     NM 66.3x     NM 12.4x     NM   14.6x   34.7x  62.6x     33.2x        45.9x    
2000 EBITDA Multiple.... 116.8x 39.5x  46.6x  8.5x     NM   11.3x   22.1x  29.9x     21.5x        25.3x    
1999 EBITDA Multiple                                                                                       
 Growth.................     NM 1.76x     NM 0.42x     NM   0.89x   1.21x  1.18x     0.92x        0.98x    
2000 EBITDA Multiple                                                                                       
 Growth.................     NM 1.05x     NM 0.29x     NM   0.69x   0.77x  0.57x     0.60x         0.54    

NM = not meaningful                                                             

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No company used in the peer group comparisons is identical to Frontier or   
Global Crossing. In evaluating the peer group companies, Morgan Stanley made    
judgments and assumptions with regard to industry performance, general          
business, economic, market and financial conditions and other matters, many of  
which are beyond the control of Frontier and Global Crossing such as the impact 
of competition on Frontier or Global Crossing and the industry generally,       
industry growth and the absence of any material adverse change in the financial 
condition and prospects of Frontier or the industry or in the financial markets 
in general.                                                                     

Analysis of Selected Precedent Transactions. As part of its analysis, Morgan
Stanley reviewed the following eight transactions involving emerging growth     
long distance and telecommunications infrastructure companies since June 1992:  

.  June 1992--LDDS Communications, Inc./Advanced Telecommunications, Inc.   

.  April 1995--Frontier Corporation/ALC Communications Corporation          

.  June 1997--Excel Communications, Inc./Telco Communications Group, Inc.   

.  September 1997--LCI International, Inc./USLD Communications Corp.        

.  November 1997--WorldCom, Inc./MCI Communications Corporation             

.  November 1997--Teleport Communications Group Inc./ACC Corp.              

.  March 1998--Qwest Communications International Inc./LCI International,   
Inc.                                                                  

.  June 1998--Call-Net Enterprises Inc./Fonorola Inc.                       

 For each of these, Morgan Stanley reviewed the prices paid and calculated the
multiples of one year trailing revenue and EBITDA as well as the premium to     
unaffected share price. The table below shows the statistics from this          
analysis.                                                                       

                                                                [Download Table]

                                                        Median  High    Low  
                                                        ------  -----  ----- 
                                                                             
Revenue Multiple.......................................  2.7x    4.0x   1.7x 
EBITDA Multiple........................................ 17.3x   35.7x  10.1x 
Premium to Unaffected Share Price......................  52.9%   94.3%  35.2%

The precedent transactions analysis implied a range of values for Frontier  
common stock of $46 to $54 per share.                                           

No transaction used in the analysis of selected precedent transactions is   
identical to the merger. In evaluating these transactions, Morgan Stanley made  
judgments and assumptions with regard to industry performance, general          
business, economic, market and financial conditions and other matters, many of  
which are beyond the control of Frontier and Global Crossing, such as the       
impact of competition on Frontier or Global Crossing and the industry           
generally, industry growth and the absence of any material adverse change in    
the financial condition and prospects of Frontier or Global Crossing or the     
industry or in the financial markets in general.                                

Discounted Cash Flow Analysis. Morgan Stanley performed discounted cash flow
analyses, which are analyses of the present value of projected cash flows using 
discount rates and terminal year EBITDA multiples, as specified, of Frontier's  
businesses. Morgan Stanley analyzed Frontier's business using a forecast for    
the period beginning January 1, 1999, and ending December 31, 2007, based on    
estimates published by securities research analysts. Morgan Stanley estimated   
Frontier's discounted cash flow value using discount rates ranging from 10% to  
11% and terminal multiples of estimated 2008 EBITDA ranging from 9x to 10x. The 
discounted cash flow analysis implied a range of values for Frontier common     
stock of $48 to $59 per share.                                                  

Morgan Stanley also performed discounted cash flow analyses of Global       
Crossing's businesses. Morgan Stanley analyzed Global Crossing's business using 
a forecast for the period beginning January 1, 1999 and ending December 31,     
2007, based on estimates provided to Morgan Stanley by Global Crossing          
management. Morgan Stanley estimated Global Crossing's discounted cash flow     
value using discount rates ranging from 11% to 13% and terminal multiples of    
estimated 2008 EBITDA ranging from 9x to 11x. The discounted cash flow analysis 
implied a range of values for Global Crossing common stock of $44 to $59 per    
share.                                                                          

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Morgan Stanley also reviewed and analyzed the sensitivity of Global         
Crossing's discounted cash flow value to changes in the projected future        
pricing of STM-1 cable sales and backhaul pricing on the Atlantic Crossing      
cable. Morgan Stanley reviewed the effect of various annual pricing declines as 
compared to the pricing declines projected by Global Crossing management. The   
table below summarizes the discounted cash flow value of Global Crossing's      
businesses implied by various annual pricing declines:                          

                                                                [Download Table]

                                                      Management            
Pricing Decline:                          15%   20%      Case    25%   30%  
----------------                          ----  ----  ---------- ----  ---- 
                                                                            
Discount Cash Flow Midpoint ($Billion)... $9.7  $8.0     $7.7    $6.5  $5.2 
% Change in Value........................   28%    4%     --     (15%) (32%)

Morgan Stanley also reviewed and analyzed the sensitivity of Global         
Crossing's discounted cash flow value to changes in the projected demand for    
STM-1 cables on the Atlantic Crossing cable. Morgan Stanley reviewed the        
effects of STM-1 demand at 75% and 50% of that projected by Global Crossing     
management. The table below summarizes the discounted cash flow value range     
implied by various levels of demand for STM-1 cables:                           

                                                                [Download Table]

                                                         Discounted Cash Flow
                                                          Range ($Billions)  
                                                         --------------------
                                                                             
Management Case.........................................      $6.6--$8.7     
75% of Demand for STM-1s................................      $5.6--$7.3     
50% of Demand for STM-1s................................      $3.9--$5.1     

 Exchange Ratio Analysis. Morgan Stanley compared the effective exchange ratio
to the ratio of the closing market prices of Frontier common stock and Global   
Crossing common stock on March 12, 1999. Morgan Stanley also compared this      
ratio to selected average historical ratios of the closing market prices of     
Frontier common stock and Global Crossing common stock over various periods     
ending March 12, 1999. The table below shows the results of this analysis:      

                                                                [Download Table]

                                                                    Market   
                                                                  Price Ratio
                                                                  -----------
                                                                             
March 12, 1999...................................................    0.82x   
5 prior trading days average.....................................    0.93x   
30 prior trading days average....................................    1.18x   
60 prior trading days average....................................    1.35x   
Average since Global Crossing initial public offering............    1.94x   

Morgan Stanley performed a variety of financial and comparative analyses    
solely for purposes of providing its opinions to the Frontier board of          
directors as to the fairness from a financial point of view to the holders of   
Frontier common stock of the exchange ratio pursuant to the merger agreement.   
The preparation of a fairness opinion is a complex process and is not           
necessarily susceptible to partial analysis or summary description. In arriving 
at its opinion, Morgan Stanley considered the results of all of its analyses as 
a whole and did not attribute any particular weight to any analysis or factor   
considered by it. Furthermore, selecting any portion of its analyses, without   
considering all analyses, would create an incomplete view of the process        
underlying its opinion. In addition, Morgan Stanley may have given various      
analyses and factors more or less weight than other analyses and factors, and   
may have deemed various assumptions more or less probable than other            
assumptions, so that the ranges of valuations resulting from any particular     
analysis described above should not be taken to be Morgan Stanley's view of the 
actual value of Frontier or Global Crossing. In performing its analyses, Morgan 
Stanley made numerous assumptions with respect to industry performance, general 
business and economic conditions and other matters, many of which are beyond    
the control of Frontier and Global Crossing. Any estimates contained herein are 
not necessarily indicative of future results or actual values, which may be     
significantly more or less favorable than those suggested by such estimates.    
The analyses performed were prepared solely as part of Morgan Stanley's         
analysis of the fairness of the exchange ratio pursuant to the merger agreement 
from a financial point of view to the holders of Frontier common stock and      

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were conducted in connection with the delivery of its opinion. The analyses are 
not intended to be appraisals or to reflect the prices at which Frontier or     
Global Crossing might actually be sold or the price at which their securities   
may trade.                                                                      

The merger consideration was determined through arm's-length negotiations   
between Frontier and Global Crossing and was approved by the Frontier board of  
directors. Morgan Stanley did not recommend any specific merger consideration   
to Frontier or that any specific merger consideration constituted the only      
appropriate merger consideration for the merger. Morgan Stanley's opinion to    
the Frontier board of directors was one of many factors taken into              
consideration by the Frontier board of directors in making its determination to 
approve the merger. Consequently, the Morgan Stanley analyses described above   
should not be viewed as determinative of the opinion of the Frontier board of   
directors with respect to the value of Frontier or whether the Frontier board   
of directors would have been willing to agree to different merger               
considerations.                                                                 

The Frontier board of directors retained Morgan Stanley based upon Morgan   
Stanley's qualifications, experience and expertise. Morgan Stanley is an        
internationally recognized investment banking and advisory firm. Morgan         
Stanley, as part of its investment banking business, is continuously engaged in 
the valuation of businesses and securities in connection with mergers and       
acquisitions, negotiated underwritings, competitive biddings, secondary         
distributions of listed and unlisted securities, private placements and         
valuations for corporate and other purposes. In the ordinary course of Morgan   
Stanley's trading, brokerage and financing activities, Morgan Stanley or its    
affiliates may at any time hold long or short positions, may trade, make a      
market or otherwise effect transactions, for its own account or for the         
accounts of customers, in the securities of Frontier or Global Crossing. In the 
past, Morgan Stanley and its affiliates have provided financing services for    
Frontier and Global Crossing and have received fees for the rendering of these  
services. In addition to acting as Frontier's financial advisor in connection   
with the merger, Morgan Stanley has within the past two years participated in   
the commercial paper syndicate for Frontier and has acted as co-manager in      
Frontier's May 21, 1997 $300 million senior note offering.                      

 Under the letter agreement dated as of January 6, 1999, as amended on June 2,
1999, Morgan Stanley has provided advisory services and a financial opinion in  
connection with the merger and Frontier has agreed to pay a transaction fee to  
Morgan Stanley in an amount equal to .275% of the aggregate value of the Global 
Crossing--Frontier transaction. In addition, Frontier has agreed to indemnify   
Morgan Stanley and its affiliates, their respective directors, officers, agents 
and employees and each person, if any, controlling Morgan Stanley or any of its 
affiliates against certain liabilities and expenses, including the fees of its  
legal counsel and certain liabilities under the federal securities laws,        
arising out of Morgan Stanley's engagement and the transactions in connection   
therewith. Morgan Stanley is also providing services relating to various        
financing or refinancing transactions subsequent to the date of the merger      
agreement for which Frontier has agreed to pay a customary fee.                 

Interests of members of Frontier's board of directors and management in the     
merger                                                                          

When you consider the recommendation of the Frontier board of directors that
you vote for the adoption of the merger agreement, you should be aware that     
certain directors and executive officers of Frontier have interests in the      
merger in addition to their interests solely as Frontier shareholders, as       
described below. These interests may create potential conflicts of interest.    
The Frontier board of directors was aware of these interests when it considered 
and adopted and approved the merger agreement and the merger.                   

Employment Agreements                                                         

In connection with the merger agreement, Frontier amended its employment    
agreements with eighteen of its executives, including Messrs. Clayton and Huff. 
These agreements include change of control provisions. Each of the employment   
agreements will provide the executives with enhanced severance benefits in      
specified situations. The executives are entitled to receive enhanced severance 
benefits if, following a change in control:                                     

.  they voluntarily terminate their employment for any reason within one    
year, or                                                              

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.  Frontier terminates the executive's employment without cause or the      
executive terminates his or her employment for good reason.           

Pursuant to the employment agreements and the merger agreement, the merger  
will constitute a change of control of Frontier.                                

The enhanced severance benefits that an executive would receive under the   
circumstances described above are:                                              

.  payment of all accrued compensation plus a pro rata bonus equal to the   
  greatest of (1) the premier bonus for the fiscal year of the termination
  of employment, but no lower than the premier bonus level established and
in effect before March 16, 1999, (2) the bonus paid or payable in     
 respect of the year before the year of the termination of employment or
(3) the bonus paid with respect to the fiscal year before the year of 
the change of control;                                                

.  payment of an amount equal to three times, in the case of Messrs.        
Clayton, Huff and six other executives, or, in the case of ten other  
 executives, two times or one times, the sum of (a) the executive's base
salary, (b) the executive's bonus, except in one agreement, (c) the   
annual value of the perquisites received by the executive, (d) payment
of the annual Frontier contributions which would have been made on the
executive's behalf to the 401(k) retirement savings plan, and (e) the 
 value of the annual allocation which would have been made to Frontier's
Supplemental Retirement Savings Plan; and                             

.  a continuation of general employee benefits, including life insurance,   
medical and dental plans, vision and hospitalization benefits for 36  
  months, or, in some cases, 24 months or 12 months, following the date of
termination.                                                          

The employment agreements also contain restrictive covenants, including non-
compete and non-solicitation covenants, which are in effect during an           
executive's employment. The employment agreements, as amended, provide that,    
following a change of control, these restrictive covenants will no longer be    
effective following a termination of the executive's employment. In addition,   
thirteen executives may be entitled to receive "gross-up" payments to offset    
taxes that may be imposed on the payments and other benefits the executives     
receive under the employment agreements, and three executives will be entitled  
to age and service credits under Frontier's pension and retirement plans.       

Effects of the merger under Frontier stock option plans                       

The merger agreement provides that, at the effective time of the merger, all
stock options then held by the employees will vest and become immediately       
exercisable. In addition, each of the Frontier Corporation Employees' Stock     
Option Plan, the Frontier Corporation Management Stock Incentive Plan, the      
Frontier Corporation Directors Stock Incentive Plan and the Frontier Omnibus    
Incentive Plan provide that upon a change of control, all stock options will    
become immediately exercisable and all restrictions on restricted stock will    
immediately lapse. The merger will result in a change of control for purposes   
of the option plans. See "The Merger Agreement--Stock options and warrants."    

Although not required under the merger agreement, Global Crossing may       
purchase or withhold from some executive officers of Frontier that own          
restricted stock under the Frontier Corporation Management Stock Incentive Plan 
either some of those shares or the shares of Global Crossing common stock that  
they will receive in the merger in an amount, estimated at approximately $20    
million in the aggregate, sufficient to fund anticipated income tax liabilities 
that will result from the removal of restrictions on their restricted stock     
awards.                                                                         

Effects of the merger under other Frontier plans                              

Following a change of control, the participants in the Frontier Corporation 
Directors Common Stock Deferred Growth Plan and the Frontier Corporation Plan   
For The Deferral of Directors Fees will have the                                

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choice whether to receive their payouts in cash or in stock of the successor.   
Participants who join the Global Crossing board of directors may continue their 
accounts in these two plans.                                                    

The merger will result in a change of control for purposes of both of these 
plans.                                                                          

Board of directors and officers of Global Crossing                            

 Under the merger agreement, Global Crossing has agreed that, at or before the
effective time of the merger, the Global Crossing board of directors will take  
all action necessary to:                                                        

.  elect four individuals to be designated by Frontier as members of the    
Global Crossing board of directors to serve in specified classes of   
directors with staggered terms,                                       

.  elect Joseph P. Clayton as Vice Chairman of Global Crossing, and         

.  elect Rolla P. Huff as President and Chief Operating Officer of North    
American Operations of Global Crossing.                               

Indemnification and insurance                                                 

Under the merger agreement and subject to specified limitations, the        
surviving corporation of the merger will maintain the current provisions        
regarding indemnification of officers, directors and employees of Frontier as   
provided in Frontier's certificate of incorporation or by-laws for a period of  
six years from the effective time of the merger. In addition, the merger        
agreement provides that the surviving corporation of the merger will maintain,  
with specified limitations, the current directors' and officers' liability      
insurance and fiduciary liability insurance policies of Frontier, or policies   
no less advantageous to the insured, for a period of six years from the         
effective time. See "The Merger Agreement--Indemnification and insurance."      

Certain federal income tax and Bermuda tax consequences                         

Federal income tax consequences                                               

 The following discussion is a summary of the material U.S. federal income tax
consequences to U.S. persons of the exchange of Frontier common stock for       
Global Crossing common stock in the merger and the ownership of Global Crossing 
common stock. The discussion which follows is based on the U.S. Internal        
Revenue Code, applicable Treasury regulations, administrative rulings and       
pronouncements and judicial decisions as of the date of this document, all of   
which could change. Any change, which may be retroactive, could alter the tax   
consequences we discuss in this document. Our discussion of tax consequences is 
also based on representations made by Global Crossing, Frontier and the         
acquisition subsidiary of Global Crossing. If any of these representations is   
inaccurate, the tax consequences of the merger could differ from those          
described in this document.                                                     

The discussion below, except where specifically noted, does not address the 
effects of any state, local or non-United States tax laws. In addition, the     
discussion below relates to persons who hold Frontier common stock and will     
hold Global Crossing common stock as capital assets. The tax treatment of a     
Frontier shareholder may vary depending upon the shareholder's particular       
situation, and some shareholders may be subject to special rules not discussed  
below. These shareholders would include, for example                            

.  insurance companies,                                                     

.  tax-exempt organizations,                                                

.  financial institutions,                                                  

.  broker-dealers,                                                          

.  shareholders who are foreign persons and                                 

.  individuals who received Frontier common stock pursuant to the exercise  
of employee stock options or otherwise as compensation.               

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In addition, this discussion does not address all of the tax consequences to
any Frontier shareholder who will own 5% or more of either the total voting     
power or the total value of the outstanding Global Crossing common stock after  
the merger, determined after we take into account ownership under the           
applicable attribution rules of the U.S. Internal Revenue Code and applicable   
Treasury regulations. We will refer to these shareholders as "5% transferee     
shareholders."                                                                  

Consequences of the merger                                                    

The obligations of Global Crossing and Frontier to complete the merger are  
conditioned on the receipt of opinions from their respective counsel, Skadden,  
Arps, Slate, Meagher & Flom LLP for Global Crossing and Simpson Thacher &       
Bartlett for Frontier. These opinions, which will be based on facts,            
representations and assumptions as counsel may reasonably deem relevant, will   
be to the effect that                                                           

.  the merger will be treated for federal income tax purposes as a          
reorganization with the meaning of Section 368 of the Internal Revenue
Code;                                                                 

.  Global Crossing, Frontier and the acquisition subsidiary will each be a  
party to that reorganization; and                                     

.  no gain or loss will be recognized by a shareholder of Frontier as a     
result of the merger, except with respect to any cash received in the 
merger; provided, that, in the case of any 5% transferee shareholder, 
  the 5% transferee shareholder enters into a "gain recognition agreement"
in accordance with applicable Treasury regulations.                   

Based on those conclusions, the following additional federal income tax     
consequences would arise:                                                       

.  Receipt of Cash. If, in addition to Global Crossing common stock, a      
Frontier shareholder receives cash in the merger, other than cash     
 received in payment for a fractional share, a Frontier shareholder will
realize gain measured by the excess, if any, of (1) the sum of the    
amount of that cash and the fair market value of the Global Crossing  
shares received in the merger over (2) the shareholder's tax basis in 
 the Frontier shares. However, any gain realized will be taxable only to
the extent of the cash received. Any gain recognized by a Frontier    
 shareholder generally will be capital gain and will be treated as long-
term capital gain if the Frontier shares have been held for more than 
  one year. However, the gain could be treated as ordinary dividend income
if, taking into account applicable constructive ownership rules, a    
 Frontier shareholder's percentage interest in Global Crossing after the
merger is not less than what that Frontier shareholder's percentage   
  interest in Global Crossing would have been had the shareholder received
only Global Crossing shares instead of cash in the merger. This could 
  happen, for example, because of a purchase of additional Global Crossing
shares by the Frontier shareholder or a related person or because of a
share repurchase by Global Crossing from other Global Crossing        
shareholders.                                                         

.  Tax basis. The tax basis to a Frontier shareholder of the Global         
Crossing common stock received in exchange for Frontier common stock  
pursuant to the merger, including any fractional share interest in    
 Global Crossing common stock for which cash is received, will equal the
Frontier shareholder's tax basis in the Frontier common stock         
surrendered in exchange therefor, increased by the amount of taxable  
gain, if any, on the exchange and decreased by the amount of any cash 
received, other than cash received in payment for a fractional share. 

.  Holding period. The holding period of a Frontier shareholder for the     
Global Crossing common stock received pursuant to the merger will     
include the holding period of the Frontier common stock surrendered in
exchange for the Global Crossing shares.                              

.  Fractional shares. A Frontier shareholder who receives cash in payment   
  for a fractional share interest in Global Crossing common stock pursuant
to the merger will be treated as having received the cash in exchange 
for the fractional share interest and generally will recognize capital
gain or loss                                                          

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 on the deemed exchange in an amount equal to the difference between the
  amount of cash received and the basis of the Frontier stock allocable to
that fractional share.                                                

Ownership of Global Crossing common stock                                     

Distributions. Distributions made to shareholders on or with respect to     
Global Crossing common stock will be treated as dividends and be taxable as     
ordinary income to the extent that those distributions are made out of Global   
Crossing's current or accumulated earnings and profits as determined for U.S.   
federal income tax purposes. Subject to the passive foreign investment company  
rules discussed below, to the extent that the amount of any distribution        
exceeds Global Crossing's accumulated earnings and profits for a taxable year,  
the excess will be treated as a tax-free return of capital which reduces the    
Global Crossing shareholders' tax basis in the Global Crossing common stock to  
the extent of the tax basis, and thereafter as capital gain from the sale or    
exchange of property. Global Crossing shareholders that are corporations        
generally will not be entitled to claim a dividends received deduction with     
respect to distributions by Global Crossing because Global Crossing is a        
foreign corporation. Global Crossing does not currently pay dividends on its    
common stock and does not anticipate paying dividends in the foreseeable        
future. See "Summary--Market prices and dividends."                             

For so long as Global Crossing is a "United States-owned foreign            
corporation," distributions with respect to the common stock that are taxable   
as dividends generally will be treated for United States foreign tax credit     
purposes as either (1) foreign source "passive income" or, in the case of some  
Global Crossing shareholders, foreign source "financial services income" or     
(2) United States source income, in proportion to the earnings and profits of   
Global Crossing in the year of the distribution allocable to foreign and        
United States sources, respectively. For this purpose, Global Crossing 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 Global Crossing is     
owned, directly or indirectly, by U.S. persons.                                 

Disposition. Subject to the passive foreign investment company and          
controlled foreign corporations rules discussed below, gain or loss realized    
by a Global Crossing shareholder on the sale, exchange or other taxable         
disposition of Global Crossing common stock will be subject to U.S. federal     
income taxation as capital gain or loss in an amount equal to the difference    
between the amount realized on that sale, exchange or other disposition and     
the shareholder's adjusted tax basis in the Global Crossing common stock        
surrendered. The gain or loss will be long term capital gain or loss if the     
shareholder's holding period for its Global Crossing common stock is more than  
one year. Any gain or loss so realized generally will be United States source.  

Passive Foreign Investment Company. In general, Global Crossing will be     
classified as a "passive foreign investment company" for any taxable year if    
either (1) at least 75% of Global Crossing's gross income is passive income or  
(2) at least 50% of the value (determined on the basis of a quarterly average)  
of Global Crossing's assets produce or are held for the production of passive   
income. Global Crossing believes that it is not a passive foreign investment    
company and does not expect to become a passive foreign investment company in   
the future for U.S. federal income tax purposes, although Global Crossing       
cannot assure you in this regard. See "Risk Factors--Global Crossing            
shareholders may be subject to Foreign Personal Holding Company, Passive        
Foreign Investment Company, Controlled Foreign Corporation and Personal         
Holding Company rules." This conclusion is a factual determination made         
annually and is subject to change. In addition, it is based, in part, on        
interpretations of existing law that Global Crossing believes are reasonable,   
but which have not been approved by any taxing authority.                       

If Global Crossing is classified as a passive foreign investment company in 
any year with respect to which a United States person is a shareholder, Global  
Crossing generally will continue to be treated as a passive foreign investment  
company with respect to that shareholder in all succeeding years, regardless    
of whether it continues to meet the income or asset test described above,       
subject to certain possible shareholder elections that may apply in some        
circumstances.                                                                  

If Global Crossing is treated as a passive foreign investment company:      

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.  Distributions made by Global Crossing during a taxable year to a         
shareholder with respect to Global Crossing stock that are "excess    
 distributions", which are defined generally as the excess of the amount
  received with respect to that stock in any taxable year over 125% of the
average received in the shorter of either the three previous years or 
the shareholder's holding period before the taxable year, must be     
allocated ratably to each day of the shareholder's holding period. The
amounts allocated to the current taxable year and to taxable years    
before the first year in which Global Crossing was classified as a    
passive foreign investment company are included as ordinary income in 
the shareholder's gross income for that current year. The amount      
allocated to each other prior taxable year is taxed as ordinary income
  at the highest rate in effect for the shareholder in that prior year and
the tax is subject to an interest charge at the rate applicable to    
deficiencies in income taxes.                                         

.  The entire amount of any gain realized upon the sale or other            
disposition, including for these purposes, a pledge of Global Crossing
  stock will be treated as an excess distribution made in the year of sale
  or other disposition. As a result, that gain will be treated as ordinary
 income and, to the extent allocated to years before the year of sale or
 disposition, will be subject to the interest charge described above. In
addition, shareholders who acquire their Global Crossing stock from   
 decedents generally will not receive a "stepped up" basis in the stock.
 Instead, these shareholders will have a tax basis equal to the lower of
the fair market value of the stock or the decedent's basis.           

 The special passive foreign investment company tax rules described above will
not apply to a Global Crossing shareholder if                                   

 1.  The Global Crossing shareholder elects to have Global Crossing treated as
a "qualified electing fund," which we refer to as a "qualified electing fund    
election," and Global Crossing provides certain information to its              
shareholders. If Global Crossing is treated as a passive foreign investment     
company, it intends to notify its shareholders and to provide to its            
shareholders all information that may be required to make the qualified         
electing fund election effective.                                               

A shareholder that makes a qualified electing fund election will be taxable 
currently on its pro rata share of Global Crossing's ordinary earnings and net  
capital gain, at ordinary income and capital gain rates, respectively, for each 
taxable year of Global Crossing during which it is treated as a passive foreign 
investment company, regardless of whether or not distributions were received.   
The shareholder's basis in the Global Crossing 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  
Global Crossing stock and will not be taxed again as a distribution to the      
shareholder.                                                                    

2. The shareholder makes a mark to market election. The mark to market      
election is only available with respect to stock that is regularly traded on    
specified United States exchanges and other exchanges designated by the United  
States Treasury. The meaning of the term "regularly traded," for purposes of    
the mark to market election, is unclear.                                        

In general, an electing shareholder will include in each year as ordinary   
income the excess, if any, of the fair market value of that 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 that 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. The electing shareholder's basis in the stock will be adjusted to     
reflect any of these income or loss amounts. Any gain or loss on the sale of    
the Global Crossing stock will be ordinary income or loss, except that a loss   
will be ordinary loss only to the extent of the previously included net mark to 
market gain.                                                                    

A shareholder who owns Global Crossing stock during any year that Global    
Crossing is a passive foreign investment company must file IRS Form 8621.       
Shareholders are urged to consult their tax advisors concerning                 

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the U.S. federal income tax consequences of holding stock of Global Crossing if 
it is a passive foreign investment company, including the advisability and      
availability of making any of the elections described above.                    

 Foreign Personal Holding Company. A foreign corporation will be classified as
a foreign personal holding company if                                           

.  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 refer to this as the "shareholder test" and        

.  the corporation receives at least 60% of its gross income (50% after the 
initial year of qualification), as adjusted, for the taxable year from
certain passive sources; we refer to this as the "income test."       

It is possible that Global Crossing or one of its non-United States         
subsidiaries will meet the income test in a given year. However, Global         
Crossing does not expect that the shareholder test will be met after the        
merger. Accordingly, it is not expected that Global Crossing or any of its non- 
United States subsidiaries will be treated as a foreign personal holding        
company, although we cannot assure you in this regard. Global Crossing intends  
to manage its affairs so as to attempt to avoid or minimize having income       
imputed to its shareholders under these rules, to the extent this management of 
its affairs is consistent with its business goals.                              

If Global Crossing or one of its non-United States subsidiaries were        
classified as a foreign personal holding company, all shareholders, including   
certain indirect holders, regardless of their percentage ownership, would be    
required to include in income, as a dividend, their pro rata share of Global    
Crossing's or its relevant non-United States subsidiary's undistributed foreign 
personal holding company income if they were holders on the last day of Global  
Crossing's taxable year or, if earlier, the last day on which Global Crossing   
satisfied the shareholder test. Foreign personal holding company income is      
generally equal to taxable income with certain adjustments. In addition, if     
Global Crossing were classified as a foreign personal holding company,          
shareholders who acquire their Global Crossing stock from decedents would not   
receive a "stepped-up" basis in that stock. Instead, these shareholders would   
have a tax basis equal to the lower of the fair market value of the stock or    
the decedent's basis.                                                           

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 like Global Crossing 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                                                              

.  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     
measured by value, directly or indirectly and                         

.  the corporation receives at least 60% of its adjusted gross income 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 Global Crossing or one of its non-United States subsidiaries will 
meet the income test in a given year. However, it is not expected that the      
shareholder test will be met after the merger. Accordingly, it is not expected  
that Global Crossing or any of its non-United States subsidiaries will be       
treated as a personal holding company, although we cannot assure you in this    
regard. Global Crossing intends to manage its affairs so as to attempt to avoid 
or minimize the imposition of the personal holding company tax, to the extent   
this management of its affairs is consistent with its business goals.           

 Controlled Foreign Corporations. For purposes of this discussion, when we use
the term "10% U.S. Shareholders," we mean United States persons who             
individually own or are deemed for U.S. federal income tax purposes to own,     
pursuant to complex attribution and constructive ownership rules 10% or more of 
the voting stock of Global Crossing or any of its non-United States             
subsidiaries.                                                                   

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If 10% U.S. Shareholders own, in the aggregate, more than 50%, measured by  
voting power or value, of the shares of Global Crossing or any of its non-      
United States corporate subsidiaries, directly, indirectly, or by attribution,  
Global Crossing or any of its non-United States subsidiaries would be a         
controlled foreign corporation. If characterized as controlled foreign          
corporations, then a portion of the undistributed income of Global Crossing and 
its non-United States subsidiaries may be includible in the taxable income of   
10% U.S. Shareholders of those entities, and a portion of the gain recognized   
by 10% U.S. Shareholders on the disposition of their shares in Global Crossing, 
which could otherwise qualify for capital gains treatment, may be converted     
into ordinary dividend income. It is possible that Global Crossing and its non- 
United States 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% U.S. Shareholders.                                          

 In order to attempt to prevent any United States person from being a 10% U.S.
Shareholder of Global Crossing, the bye-laws of Global Crossing generally       
provide, among other things, that no holder of Global Crossing common stock or  
any group of holders through whom ownership may be attributed to another holder 
by the constructive ownership or attribution rules of Section 958 of the        
Internal Revenue Code will be allowed to cast votes with respect to more than   
9.5% of the common stock, and some restrictions have been placed on the         
transferability of shares. See "Description of Global Crossing Capital Stock--  
Voting and transfer restrictions." We cannot assure you that these limitations  
will prevent the characterization of Global Crossing or any of its non-United   
States subsidiaries as a controlled foreign corporation or of any shareholder   
as a 10% U.S. Shareholder. However, a shareholder that owns directly less than  
10% of the common stock generally will not be treated as a 10% U.S. Shareholder 
unless it is attributed common stock owned by other shareholders.               

Information Reporting and Backup Withholding. In general, information       
reporting requirements will apply to dividends in respect of the Global         
Crossing common stock or the proceeds received on the sale, exchange, or        
redemption of the Global Crossing common stock paid within the United States,   
and in some cases, outside of the United States, to shareholders other than     
certain exempt recipients, such as corporations, and a 31% backup withholding   
may apply to the amounts if the shareholder fails to provide an accurate        
taxpayer identification number or to report dividends required to be shown on   
its U.S. federal income tax returns. The amount of any backup withholding from  
a payment to a shareholder will be allowable as a refund or credit against the  
shareholder's U.S. federal income tax liability, provided that the required     
information or appropriate claim for refund is furnished to the Internal        
Revenue Service.                                                                

Bermuda tax consequences                                                      

In the opinions of Conyers Dill & Pearman, special Bermuda tax counsel for  
Frontier, and Appleby, Spurling & Kempe, Bermuda tax counsel for Global         
Crossing, there will be no Bermuda                                              

.  income, corporation or profits tax,                                      

.  withholding tax,                                                         

.  capital gains tax,                                                       

.  capital transfer tax,                                                    

.  estate duty or                                                           

.  inheritance tax                                                          

payable in respect of an exchange of Frontier common stock for Global Crossing  
common stock pursuant to the merger. In addition, as of the date of this        
document, there is no Bermuda income, corporation or profits tax, withholding   
tax, capital gains tax, capital transfer tax, estate duty or inheritance tax    
payable in respect of capital gains realized on a disposition of Global         
Crossing common stock or in respect of distributions by Global Crossing with    
respect to Global Crossing common stock. Under current Bermuda law, Global      
Crossing is not subject to tax on income or capital gains. Furthermore, Global  
Crossing has obtained from the Minister of Finance of Bermuda under the         
Exempted Undertakings Tax Protection Act 1966 an undertaking that, in the       

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event that Bermuda enacts any legislation imposing tax computed on profits,     
income, any capital asset, gain or appreciation, or any tax in the nature of    
estate duty or inheritance tax, then the imposition of that tax will not be     
applicable to Global Crossing or to any of its operations or the shares,        
debentures or other obligations of Global Crossing, until March 28, 2016. This  
undertaking does not, however, prevent the application of any tax or duty to    
persons ordinarily resident in Bermuda or of any tax payable pursuant to The    
Land Tax Act 1967 of Bermuda or otherwise payable in relation to land leased to 
Global Crossing.                                                                

Anticipated accounting treatment                                                

 For accounting and financial reporting purposes, the merger is intended to be
treated as a purchase by Global Crossing under generally accepted accounting    
principles. Under the purchase method of accounting, Frontier's assets and      
liabilities, as of the effective date of the merger, will be recorded at their  
respective fair values and added to those of Global Crossing. For purposes of   
preparing Global Crossing's consolidated financial statements, Global Crossing  
will establish a new accounting basis for Frontier's assets and liabilities     
based upon the fair values thereof, the merger consideration and the costs of   
the transactions. Global Crossing's management believes that any excess of cost 
over the fair value of the net assets of Frontier will be recorded as goodwill. 
A final determination of the intangible asset lives and required purchase       
accounting adjustments, including the allocation of the purchase price to the   
assets acquired and liabilities assumed based on their respective fair values,  
has not yet been made. Accordingly, the purchase accounting adjustments made in 
connection with the development of the unaudited pro forma financial            
information appearing elsewhere in this document are preliminary and have been  
made solely for purposes of developing the unaudited pro forma financial        
information. Global Crossing has undertaken a study to determine the fair value 
of some of Frontier's assets and liabilities and will make appropriate purchase 
accounting adjustments upon completion of that study. For financial reporting   
purposes, the results of operations of Frontier will be included in the Global  
Crossing consolidated statement of operations following the effective time of   
the merger and Global Crossing's historical consolidated statements of          
operations will not be restated. See "Unaudited Pro Forma Condensed Combined    
Financial Statements."                                                          

Regulatory approvals                                                            

Hart-Scott-Rodino Act                                                         

We cannot complete the merger until we give notification and furnish        
information to the Federal Trade Commission and the Antitrust Division of the   
Department of Justice and the specified waiting period requirements have been   
satisfied. We filed the required notification and report forms with the Federal 
Trade Commission and the Antitrust Division on April 29, 1999 and the waiting   
period was terminated on May 11, 1999. At any time before or after the          
effective time of the merger, and notwithstanding that the waiting period has   
terminated or the merger may have been consummated, the Federal Trade           
Commission, the Antitrust Division or any state could take any action under the 
applicable antitrust or competition laws as it deems necessary or desirable.    
This action could include seeking to enjoin the completion of the merger.       
Private parties may also institute legal actions under the antitrust laws under 
some circumstances.                                                             

Subsequent to the May 11, 1999 early termination of the waiting period, U S 
WEST acquired approximately 9.49% of the outstanding common stock of Global     
Crossing, the acquisition of which the Antitrust Division of the Department of  
Justice is currently investigating. We do not expect that this investigation    
will delay the completion of the Global Crossing--Frontier merger.              

FCC and Public Utility Commission approvals                                   

It is a condition to the merger that                                        

.  the approval of the Federal Communications Commission and                

.  approvals of public utility commissions of the states                    

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be obtained without the imposition of conditions reasonably expected to have a  
material adverse effect on Global Crossing and some of its subsidiaries,        
including, following the merger, Frontier, unless the failure to obtain any     
public utility commission approval would not reasonably be expected to have a   
material adverse effect on Global Crossing and some of its subsidiaries,        
including, following the merger, Frontier.                                      

See "The Merger Agreement--Conditions to the completion of the merger."     

Bermuda Monetary Authority                                                    

The issuance of Global Crossing shares in the merger and the subsequent free
transferability of the corresponding shares between non-residents of Bermuda    
for exchange control purposes must be approved by the Bermuda Monetary          
Authority. Global Crossing obtained that approval on July 1, 1999.              

The approval of the Bermuda Monetary Authority is required for the issuance 
of shares by any Bermuda company to a non-resident of Bermuda for exchange      
control purposes.                                                               

Approvals or permissions received from the Bermuda Monetary Authority in    
connection with this document do not constitute a guarantee by the Bermuda      
Monetary Authority as to the creditworthiness of Global Crossing. Furthermore,  
in giving those approvals, the Bermuda Monetary Authority will not be liable    
for the performance or default of Global Crossing or of the correctness of any  
opinions or statements expressed in this document.                              

No appraisal rights                                                             

Since Global Crossing is not party to the merger between Frontier and Global
Crossing's wholly owned subsidiary, under Bermuda law, Global Crossing          
shareholders are not entitled to dissenters' rights of appraisal in connection  
with the merger.                                                                

Under the New York Business Corporation Law, Frontier shareholders are not  
entitled to dissenters' appraisal rights in connection with the merger because  
the Frontier common stock was listed on the New York Stock Exchange on the      
record date for the Frontier special meeting.                                   

Quotation on the Nasdaq National Market                                         

It is a condition to the merger that the shares of Global Crossing common   
stock to be issued in the merger and the other shares to be reserved for        
issuance in connection with the merger be approved for trading on the Nasdaq    
National Market upon official notice of issuance. The merger agreement provides 
that Global Crossing will use its reasonable best efforts to cause the shares   
of Global Crossing common stock to be issued in the merger and the shares of    
Global Crossing common stock to be reserved for issuance in connection with the 
merger to be approved for trading on the Nasdaq National Market.                

Litigation                                                                      

On June 18, June 23, July 7 and July 13, 1999, four purported shareholder   
class action suits were filed in New York State Supreme Court against Frontier, 
the members of its board and others. These complaints allege, among other       
things, that the defendants have breached their fiduciary duties in connection  
with the unsolicited bid by Qwest. These complaints variously seek, among other 
things, a court order enjoining any proposed transaction with U S WEST or       
requiring the defendants to take certain actions with respect to a merger or    
acquisition of Frontier, including, but not limited to, engaging in             
negotiations with Qwest. Frontier believes that these complaints are without    
merit and intends to defend them vigorously.                                    

Resales of Global Crossing common stock                                         

All shares of Global Crossing common stock received by Frontier shareholders
in the merger will be registered under the Securities Act of 1933 and will be   
freely tradeable without restriction by people who will                         

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not be affiliates of Global Crossing after the merger or who were not           
affiliates of Frontier on the date of the Frontier special meeting. Any of      
those people may resell the Global Crossing common stock received by him or her 
in the merger only if the shares are registered for resale under the Securities 
Act or an exemption from such registration under the Securities Act is          
available. Those people may be permitted to effect resales under the safe       
harbor provisions of Rule 145 under the Securities Act, or Rule 144 in the case 
of persons who become affiliates of Global Crossing, or as otherwise permitted  
under the Securities Act. People who may be deemed to be affiliates of Frontier 
or Global Crossing generally include individuals or entities that control, are  
controlled by, or are under common control with, Frontier or Global Crossing,   
as applicable, and may include some officers and all directors of that party as 
well as principal shareholders of Frontier or Global Crossing, as applicable.   
We recommend that any of those people obtain advice of securities counsel       
before making any resale.                                                       

The merger agreement provides that,                                         

.  on or before the date of the Frontier special meeting, Frontier will     
deliver to Global Crossing a letter identifying all people who may be 
deemed to be affiliates of Frontier for purposes of Rule 145 under the
Securities Act and                                                    

.  on or before the closing date, Frontier will use all reasonable efforts  
to cause each of its affiliates to deliver a written agreement to the 
  effect that the affiliate will not offer or sell or otherwise dispose of
any shares of Global Crossing common stock received in the merger in  
  violation of the Securities Act or the rules and regulations thereunder.

 This document does not cover resales of Global Crossing common stock received
by any person who may be deemed to be an affiliate of Global Crossing or        
Frontier.                                                                       

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The Merger Agreement

This section is a summary of the material terms of the merger agreement, as 
amended, a copy of which is attached as Annex A to this document. The following 
description does not purport to be complete and is qualified in its entirety by 
reference to the merger agreement. You should refer to the full text of the     
merger agreement for details of the merger and the terms and conditions of the  
merger agreement.                                                               

The merger                                                                      

When the merger occurs, GCF Acquisition Corp., a direct wholly owned        
subsidiary of Global Crossing, will be merged with and into Frontier in         
accordance with the New York Business Corporation Law. As a result of the       
merger, Frontier will be a wholly owned subsidiary of Global Crossing.          

 Each share of Frontier common stock issued and outstanding immediately before
the merger, other than shares owned or held directly or indirectly by Global    
Crossing or directly by Frontier, which will be canceled, will be converted     
into the right to receive a number of shares of Global Crossing common stock    
equal to the exchange ratio. See "The Merger--What you will receive in the      
merger." Each holder of a certificate representing any shares of Frontier       
common stock will no longer have any rights with respect to the shares of       
Frontier common stock, except the right to receive Global Crossing common stock 
and any cash included in the merger consideration. Global Crossing common stock 
is described beginning on page 135.                                             

 Under the terms of the merger agreement, at the effective time of the merger:

.  the certificate of incorporation of the surviving corporation will be    
amended so that its provisions will be the same as the certificate of 
incorporation of GCF Acquisition Corp., the acquisition subsidiary,   

.  the by-laws of GCF Acquisition Corp. will be the by-laws of the          
surviving corporation, and                                            

.  the officers of Frontier as of the effective time will be the officers   
 of the surviving corporation and the directors of GCF Acquisition Corp.
as of the effective time will be the directors of the surviving       
corporation.                                                          

Effective time of the merger                                                    

The merger will become effective when we file a certificate of merger with  
the New York Department of State. However, we may agree to a later effective    
time, and specify that time in the certificate of merger. We will file the      
certificate of merger on the second business day after the satisfaction or      
waiver of all conditions in the merger agreement, other than conditions that    
cannot be satisfied until the closing date. See "--Conditions to the completion 
of the merger."                                                                 

Exchange procedures                                                             

After the effective time of the merger, EquiServe, as the exchange agent,   
will mail to each person who held shares of Frontier common stock at the time   
of the merger a letter of transmittal. Frontier shareholders should use this    
letter of transmittal in forwarding Frontier stock certificates. This letter    
will include instructions for the exchange of Frontier stock certificates for   
Global Crossing stock certificates. After surrendering a Frontier stock         
certificate together with the letter of transmittal, and any other documents    
the exchange agent reasonably requires, the holder of a Frontier stock          
certificate will be entitled to receive a Global Crossing stock certificate.    
Frontier shareholders should not send in their Frontier common stock            
certificates until they receive a letter of transmittal.                        

In addition to a certificate representing Global Crossing common stock, the 
holder of a surrendered Frontier stock certificate will receive a check in the  
amount of cash the holder is entitled to receive, including                     

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.  cash paid instead of fractional shares,                                  

.  any dividends or other distributions on the shares of Global Crossing    
common stock that have a record date after the merger, and a payment  
 date before the holder surrenders the Frontier common stock certificate
and                                                                   

.  any cash payable as a result of the cash top-up described under "--      
Termination; Possible exchange ratio increase."                       

However, no cash will be paid until the holder of the Frontier common stock 
certificate surrenders that certificate. The holder will also receive any       
dividends or other distributions with a record date after the merger but before 
the surrender, and a payment date after the surrender. In each case, taxes will 
be withheld as required.                                                        

After the merger, there will be no transfers on the transfer books of       
Frontier of shares of Frontier common stock that were outstanding immediately   
before the merger.                                                              

Any Global Crossing stock certificates and any cash deposited by Global     
Crossing with the exchange agent that remain unclaimed by former Frontier       
shareholders twelve months after the merger will be delivered to the surviving  
corporation. Any former Frontier shareholders who have not complied with the    
exchange procedures before the first anniversary of the merger may look only to 
Global Crossing and the surviving corporation for payment of the merger         
consideration and any cash instead of fractional shares and unpaid dividends or 
distributions on the shares of Global Crossing common stock. Neither Global     
Crossing, GCF Acquisition Corp., Frontier or the exchange agent will be liable  
to you for any amount delivered to a public official pursuant to any applicable 
abandoned property, escheat or similar law.                                     

 No interest will be paid or accrued on any cash payable instead of fractional
shares, as unpaid dividends and distributions with respect to unexchanged       
shares or otherwise as merger consideration.                                    

If your Frontier stock certificates have been lost, stolen or destroyed, you
will only be entitled to obtain shares of Global Crossing common stock by       
making an affidavit and, if required by the surviving corporation, by posting a 
bond in an amount sufficient to protect the surviving corporation against       
claims related to your Frontier stock certificate.                              

Frontier preferred stock                                                        

In the merger agreement, Frontier agreed to redeem all of its outstanding   
preferred stock before the date of the Frontier special meeting. On July 1,     
1999, Frontier redeemed all of its outstanding preferred stock.                 

Stock options and warrants                                                      

 In the merger, each option and warrant to buy shares of Frontier common stock
will become an immediately exercisable option or warrant to buy, on the same    
terms and conditions, the number of shares of Global Crossing common stock as   
the holder of the option or warrant would have been entitled to receive in the  
merger if the holder would have exercised the option or warrant in full         
immediately before the merger. The price per share subject to each option and   
warrant will be equal to the exercise price for the option or warrant divided   
by the number of shares of Global Crossing common stock deemed purchasable      
under the option or warrant, which will not include fractional shares.          

Representations and warranties                                                  

The merger agreement contains essentially reciprocal representations and    
warranties made by each of us to the other, including representations and       
warranties relating to:                                                         

.  organization, standing and power,                                        

.  capitalization,                                                          

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.  power and authority to enter into and consummate the transactions under  
the merger agreement,                                                 

.  absence of conflicts between organizational documents, laws and          
agreements and the transactions under the merger agreement,           

.  governmental consents in connection with the transactions under the      
merger agreement,                                                     

.  filings with the Securities and Exchange Commission, financial           
statements and incurrence of liabilities since December 31, 1998,     

.  information supplied for this document,                                  

.  board of directors approval and required shareholder vote,               

.  rights agreement, in the case of Frontier only,                          

.  brokers and finders fees with respect to the merger,                     

.  receipt of fairness opinions,                                            

.  litigation,                                                              

.  compliance with applicable laws,                                         

.  tax matters, and                                                         

.  employee benefit plans.                                                  

 The merger agreement also contains representations and warranties relating to
GCF Acquisition Corp.'s organization and corporate power, power and authority   
to enter into and consummate the transactions under the merger agreement,       
absence of conflicts between its organizational documents and the transactions  
under the merger agreement and the absence of business activities of GCF        
Acquisition Corp. other than in connection with the completion of the           
transactions contemplated by the merger agreement.                              

All representations and warranties of Global Crossing, Frontier and GCF     
Acquisition Corp. expire at the effective time of the merger.                   

Covenants                                                                       

Conduct of business of Frontier pending the completion of the merger          

Frontier has agreed that, until the completion of the merger, except as     
otherwise permitted by the merger agreement or if Global Crossing consents in   
writing, which consent will not be unreasonably withheld or delayed, it and its 
subsidiaries will                                                               

.  carry on its business in the usual, regular and ordinary course in all   
 material respects and use all reasonable efforts to preserve intact its
 present lines of business, maintain its rights, franchises and licenses
and preserve its relationships with customers, suppliers and others   
having business dealings with it to the end that its ongoing business 
will not be impaired in any material respect,                         

.  not (1) enter a new material line of business or (2) incur capital       
expenditures other than those incurred or committed to in the ordinary
course of business consistent with past practice, which together with 
all expenditures incurred or committed for fiscal year 1999, do not   
exceed $900 million,                                                  

.  not declare any dividends on its common stock, other than the regular    
quarterly dividend in the amount of $.05 per share,                   

.  not split, combine or reclassify its capital stock or repurchase its     
capital stock, other than specified permitted exceptions,             

.  not issue additional capital stock or securities convertible into or     
exercisable for, or any rights, warrants or options to acquire any    
capital stock, with specified permitted exceptions, including upon the
exercise of stock options,                                            

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.  not amend (in the case of subsidiaries, in any material respect) its     
organizational documents,                                             

.  not make any acquisitions, except that Frontier may make acquisitions    
related to the communications or internet business providing for      
consideration not in excess of $500 million and Frontier Internet     
Ventures Inc. may make up to $30 million of acquisitions,             

.  not make any material dispositions of its assets, other than in the      
ordinary course of business and other specified permitted exceptions, 

.  except in the ordinary course of business consistent with past practice, 
not make any investments,                                             

.  not incur any indebtedness except under existing facilities or           
refinancings of existing facilities,                                  

.  not take any action that would adversely affect the tax-free nature of   
the merger,                                                           

.  not (1) increase the compensation of its senior executive officers,      
  except in the ordinary course of business consistent with past practice,
or as required by an existing agreement or (2) make any increase in   
employee benefits,                                                    

.  not take specified other actions that could reasonably be expected to    
prevent the satisfaction of any of the conditions to the merger,      

.  not change its methods of accounting or income tax elections, except as  
required by generally accepted accounting principles, and             

.  not modify the rights agreement, other than as expressly provided in the 
merger agreement.                                                     

Conduct of business of Global Crossing pending completion of the merger       

Global Crossing has agreed that, until the completion of the merger or as   
provided below, except as otherwise permitted by the merger agreement or if     
Frontier consents in writing, which consent will not be unreasonably withheld   
or delayed, it and its subsidiaries will                                        

.  carry on its business in the usual, regular and ordinary course in all   
 material respects and use all reasonable efforts to preserve intact its
 present lines of business, maintain its rights, franchises and licenses
and preserve its relationships with customers, suppliers and others   
having business dealings with it to the end that its ongoing business 
will not be impaired in any material respect,                         

.  not enter a new material line of business that is not related to the     
communications business other than incidentally as part of a larger   
acquisition within an existing line of business,                      

.  not declare any dividends on its common stock,                           

.  not repurchase its capital stock, subject to specified permitted         
exceptions,                                                           

.  not issue additional capital stock or securities convertible into or     
exercisable for, or any rights, warrants or options to acquire any    
capital stock, except (1) upon the exercise of stock options, (2)     
issuance of stock options and (3) other issuances so long as the      
issuances do not cause the shares of Global Crossing common stock     
 subject to the voting agreement described below to constitute less than
51% of the voting power of Global Crossing,                           

.  not amend its organizational documents, except for the increase in its   
authorized share capital and the bye-law amendments discussed in this 
document,                                                             

.  not make any acquisitions, except that Global Crossing may make          
  acquisitions that provide for consideration of no more than $2.5 billion
  per acquisition and $8.5 billion in the aggregate, of which no more than
$7.5 billion in the aggregate can consist of voting equity securities,
and except that Global Crossing may not issue Global Crossing common  
stock in acquisitions if it would cause the voting power of the shares
subject to the voting agreement to constitute less than 51% of the    
voting power of Global Crossing,                                      

.  not make any material dispositions of its assets, other than in the      
ordinary course of business and other specified permitted exceptions, 

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.  other than in the ordinary course of business, not make any investments, 

.  not take any action that would adversely affect the tax-free nature of   
  the merger, including in connection with structuring or completing the U
S WEST merger and the transactions contemplated by that merger,       

.  not take specified other actions that could reasonably be expected to    
prevent the satisfaction of any of the conditions to the merger,      

.  not change its methods of accounting or income tax elections, except as  
required by generally accepted accounting principles, and             

.  not enter into any merger or similar agreement under which Global        
Crossing shareholders would receive consideration for their shares    
unless (1) the transaction will be completed after the merger, (2) the
  consideration to be received by Global Crossing shareholders would be no
less than $34.5625 and (3) the transaction would not result in the    
merger failing to be tax-free.                                        

Global Crossing has also agreed that during the measurement period for      
determining the exchange ratio, it will not and will not announce an intention  
to:                                                                             

.  acquire Global Crossing common stock in the open market,                 

.  sell, issue or redeem any shares of Global Crossing common stock subject 
  to specified exceptions, or take action prohibited by Regulation M under
the Securities Act of 1933,                                           

.  enter into any material acquisition or disposition, or                   

.  make any announcement, except as required by applicable law or rules of  
the Nasdaq National Market, which would reasonably be expected to have
the effect of resulting in a change in the trading price of the Global
Crossing common stock.                                                

No solicitation of transactions                                                 

In the merger agreement, Frontier has agreed that neither it nor any of its 
subsidiaries nor any of the officers and directors of it or its subsidiaries    
will, and that it will direct and use its best efforts to cause its and its     
subsidiaries' employees, agents and representatives (including any investment   
banker, attorney or accountant retained by it or any of its subsidiaries) not   
to, directly or indirectly:                                                     

.  initiate, solicit, encourage or knowingly facilitate, including by way   
of furnishing information, any inquiries or the making of any proposal
or offer with respect to:                                             

--a merger, consolidation, business combination, recapitalization,      
liquidation, dissolution or similar transaction involving Frontier or   
any of its subsidiaries, or                                             

--any purchase or sale of all or any significant portion of the assets  
or more than 20% of Frontier or its subsidiaries' common stock,         

.  have any discussion with or provide any confidential information or data 
 to any person relating to any proposals or offers described above which
we will refer to as an "acquisition proposal," or                     

.  engage in any negotiations concerning any acquisition proposal or accept 
an acquisition proposal.                                              

However, if Frontier receives an unsolicited bona fide written acquisition  
proposal and the Frontier special meeting has not occurred, the Frontier board  
of directors may                                                                

.  withdraw or modify in any adverse manner the approval of the merger      
agreement and the merger or                                           

.  engage in discussions or negotiations with, or provide any information   
to, the person making the acquisition proposal,                       

if the Frontier board of directors concludes in good faith that the acquisition 
proposal, in the case of the first bullet point above would, if completed,      
constitute a superior proposal or in the case of the second bullet point above, 
could reasonably be expected to constitute a superior proposal.                 

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We refer to a "superior proposal" as a bona fide written proposal with      
respect to:                                                                     

.  a merger, consolidation, business combination, recapitalization,         
liquidation, dissolution or similar transaction involving Frontier, or

.  any purchase or sale of all or any significant portion of the assets of  
Frontier and its subsidiaries, taken as a whole, or more than 50% of  
Frontier's common stock,                                              

which the Frontier board of directors concludes in good faith, after            
consultation with its financial advisors and legal counsel, taking into account 
all legal, financial, regulatory and other aspects of the proposal and the      
person making the proposal,                                                     

.  would, if completed, result in a transaction that is more favorable to   
the Frontier shareholders, in their capacities as shareholders, from a
financial point of view, than the transactions contemplated by the    
merger agreement and                                                  

.  is reasonably capable of being completed.                                

 In addition, before providing any information or data to any person making an
acquisition proposal, the Frontier board of directors must receive an executed  
confidentiality agreement from that person on terms substantially similar to    
those contained in the confidentiality agreement between Frontier and Global    
Crossing, except as to standstill provisions, in which case Global Crossing     
will get the benefit of any favorable changes to the standstill provisions.     

Frontier has also agreed that it will notify Global Crossing of any inquiry,
proposal or offer before providing any information or data to any person or     
entering into discussions or negotiations with any person making the inquiry,   
proposal or offer and to keep Global Crossing informed, on a current basis, of  
the status and terms of any proposals, offers, discussions or negotiations.     
Frontier has also agreed to terminate any existing activities, discussions or   
negotiations with any parties conducted before the date of the merger agreement 
with respect to any acquisition proposal.                                       

Board of directors' covenant to recommend                                       

Subject to the provisions described above under "--No solicitation of       
transactions" and the right of Frontier to terminate the merger agreement to    
accept a superior proposal described under "--Termination; Possible exchange    
ratio increase," Frontier has agreed that its board of directors will recommend 
adoption of the merger agreement by Frontier shareholders.                      

Global Crossing has agreed that its board of directors will recommend       
approval of the transactions contemplated by the merger agreement by the        
shareholders of Global Crossing.                                                

Transition planning; Continued operations of Frontier                           

We have agreed to create a committee that will be responsible for           
coordinating transition planning and implementation relating to the merger. The 
initial representatives of Global Crossing are Jack M. Scanlon, David L. Lee,   
Abbott L. Brown and James C. Gorton, and the initial representatives of         
Frontier are Robert L. Barrett, James G. Dole, Rolla P. Huff and R. Charles     
Mancini. We have also agreed to maintain the headquarters of Frontier Telephone 
of Rochester, Inc. in Rochester, New York.                                      

Services agreement                                                              

Frontier and Global Crossing agreed to use reasonable good faith efforts as 
soon as practicable after the execution of the merger agreement to negotiate a  
services agreement whereby each party will provide specified services to the    
other party. Frontier and Global Crossing entered into such an agreement on May 
6, 1999, which was amended on May 25, 1999.                                     

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Reasonable best efforts                                                         

We have agreed to use our reasonable best efforts to take, or cause to be   
taken, all actions and to do, or cause to be done, all things necessary, proper 
or advisable under applicable laws and regulations, including the Hart-Scott-   
Rodino Antitrust Act and the laws and regulations of the FCC, public utility    
commissions and local franchising authorities, to complete the merger and the   
other transactions contemplated by the merger agreement as soon as practicable  
after the date of the merger agreement. Global Crossing is not required to sell 
or otherwise dispose of, or permit the sale or other disposition of, any assets 
of Global Crossing, Frontier or any of their subsidiaries, whether as a         
condition to obtaining any approval from a governmental entity or any other     
person or for any other reason, if Global Crossing reasonably determines that   
the sale or other disposition would have or is likely to have a material        
adverse effect on Global Crossing and its subsidiaries, including the surviving 
corporation and its subsidiaries, taken together, after the merger.             

Employee benefits                                                               

After the merger, Global Crossing has agreed to cause the surviving         
corporation and its subsidiaries to, for at least two years after the effective 
time, provide benefits which, in the aggregate, are no less favorable than the  
benefits provided, in the aggregate, under the Frontier benefit plans before    
the merger, but Global Crossing will not be required to continue any particular 
benefit plan or prevent the amendment or termination of any plan other than the 
Employee Telecommunications Benefit program, the Educational Assistance Fund,   
the Educational Assistance Program, the Executive Perquisite program and the    
Change in Control Severance Plan for Salary Band Levels 25 and Above for a      
period of two years after the effective time.                                   

The parties have also agreed that the transition committee described above  
will also jointly determine how a retention program of $35 million in the       
aggregate to Frontier employees will be administered.                           

Indemnification and insurance                                                   

 After the merger, the surviving corporation will maintain for a period of six
years after the effective time of the merger:                                   

.  the current provisions regarding elimination of liability of directors   
and indemnification of officers, directors and employees contained in 
the certificate of incorporation and by-laws of Frontier, and         

.  the current policies of directors' and officers' liability insurance and 
fiduciary liability insurance for acts and omissions occurring before 
the merger maintained by Frontier; provided, that the surviving       
corporation may substitute policies of at least the same coverage and 
 amounts containing terms and conditions which are, in the aggregate, no
less advantageous to the covered persons, but if the annual premium is
more than 200% of the last annual premiums currently paid by Frontier,
Global Crossing must obtain a policy with the greatest coverage       
available for a cost not exceeding that amount.                       

Frontier may satisfy the obligations in the second bullet point above by    
buying a "tail" policy before the closing covering those matters for a premium  
that is not more than the total premium stated above.                           

Conditions to the completion of the merger                                      

We may complete the merger only if each of the following conditions is met: 

.  the holders of two-thirds of the outstanding shares of Frontier common   
  stock adopt the merger agreement and the holders of a simple majority of
the votes of all outstanding shares of Global Crossing common stock   
approve the increase in authorized shares and the share issuance,     

.  there is no law, order or injunction issued by a court or other          
 governmental entity of competent jurisdiction making the merger illegal
  or otherwise prohibiting completion of the merger, except that this will
not be a condition for any party whose failure to fulfill its         
obligations described above under "--Reasonable best efforts" is the  
cause of, or results in, that order or injunction,                    

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.  all approvals for the merger from the FCC and from the public utility    
  commissions are obtained without the imposition of conditions that would
reasonably be expected to have a material adverse effect on Global    
Crossing and its subsidiaries, including the surviving corporation and
 its subsidiaries, other than those approvals the failure of which to be
obtained would not reasonably be expected to have a material adverse  
 effect on Global Crossing and its subsidiaries, including the surviving
corporation and its subsidiaries,                                     

.  the waiting period applicable to the merger under the Hart-Scott-Rodino  
 Antitrust Improvements Act of 1976 terminates or expires, which waiting
period was terminated on May 11, 1999,                                

.  the registration statement on Form S-4 of which this document is a part  
continues to be effective under the Securities Act and the shares of  
Global Crossing common stock to be issued and reserved for issuance in
the merger are approved upon official notice of issuance for quotation
on the Nasdaq National Market,                                        

.  the Bermuda Monetary Authority approves the share issuance and the       
subsequent free transferability of the corresponding shares between   
nonresident persons for exchange control purposes, which the Bermuda  
Monetary Authority did on July 1, 1999,                               

.  the representations and warranties of the other party in the merger      
  agreement that are qualified as to material adverse effect were true and
 correct on the date of the merger agreement and as of the closing date,
except to the extent they speak as of a specified date,               

.  the representations and warranties of the other party that are not       
qualified as to material adverse effect were true and correct in all  
  material respects on the date of the merger agreement and on the closing
  date, except (1) to the extent they speak as of a specified date and (2)
 this condition will be satisfied so long as all failures to be true and
correct, taken together, would not reasonably be expected to have a   
material adverse effect on that party,                                

.  the other party has complied with its agreements and covenants under the 
 merger agreement at or before the closing date that are qualified as to
  materiality and has complied in all material respects with all its other
agreements and covenants that are not so qualified as to materiality, 
and                                                                   

.  each party receives from its counsel a written opinion dated as of the   
closing date with respect to the tax-free nature of the merger.       

Global Crossing's obligation to complete the merger is also subject to Frontier 
redeeming its preferred stock, which Frontier did on July 1, 1999.              

For purposes of the merger agreement, a "material adverse effect" means any 
adverse change, circumstance or effect that is or is reasonably likely to be    
materially adverse to the business, financial condition or results of           
operations of a person and its subsidiaries, taken as a whole, other than any   
change, circumstance or effect relating to the economy or securities markets in 
general or the industries in which Global Crossing or Frontier operate and not  
specifically relating to them.                                                  

Termination; Possible exchange ratio increase                                   

(1) We may terminate the merger agreement and abandon the merger at any time
before we complete the merger by our mutual written consent.                    

(2) Either of us may also terminate the merger agreement if:                

.  the merger does not occur before March 16, 2000, except as described     
 below under "--Alternative Merger," but that the right to terminate the
merger agreement will not be available (a) if the party desiring to   
terminate has failed to fulfill any obligation that has been the cause
of, or resulted in, the failure of the merger to occur on or before   
March 16, 2000 and (b) to Global Crossing if all of the conditions to 
  completing the merger have been satisfied or waived other than (1) those
that cannot be satisfied until the closing date so long as it is      
reasonably apparent that those conditions will be able to             

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be satisfied and (2) the condition relating to FCC and public utility 
commission approvals described in the third bullet under "--Conditions
to the completion of the merger,"                                     

.  any governmental entity either (1) issues a final and nonappealable      
order, decree or ruling or takes any other action permanently         
restraining, enjoining or otherwise prohibiting the transactions      
contemplated by the merger agreement or (2) fails to issue an order,  
decree or ruling or to take any other action, in each case which is   
necessary to fulfill the conditions contained in the third and fourth 
 bullets under "--Conditions to the completion of the merger" above, and
the denial of a request to issue the order, decree or ruling or take  
  such other action is final and nonappealable; but the right to terminate
the merger agreement will not be available if the party desiring to   
terminate has failed to comply with its obligations described above   
 under "--Reasonable best efforts" that has been the cause of the action
or inaction, or                                                       

.  the shareholders of the other party fail to approve the matters required 
to be approved by them.                                               

(3) Global Crossing may terminate the merger agreement if the Frontier board
of directors, before the Frontier special meeting, withdraws or modifies in     
any adverse manner its approval and recommendation of the merger or approves    
or recommends a superior proposal pursuant to the provisions described under    
"--No solicitation of transactions."                                            

(4) Frontier may terminate the merger agreement if:                         

(a) at any time before the Frontier special meeting, the Frontier board 
of directors, approves a superior proposal; provided that                   

.  Frontier has complied with the provisions described under "--No      
solicitation of transactions,"                                    

.  the Frontier board of directors concludes in good faith, after       
considering any changes to the terms of the merger agreement which
are offered by Global Crossing during the period described in the 
next bullet point, on the basis of the advice of its financial    
advisors and outside counsel, that the proposal is a superior     
proposal, and                                                     

.  before terminating the merger agreement, Frontier complies with      
specified notice and waiting periods which give Global Crossing a 
 chance to negotiate with Frontier to adjust the terms of the merger
agreement.                                                        

Frontier may exercise this termination right only if it has paid Global     
Crossing the $270 million termination fee described below under "--         
Termination fees," or                                                       

(b) the Frontier board of directors so determines by a vote of the      
majority of the members of the entire Frontier board of directors, at any   
time during the three business day period beginning on the date before all  
closing conditions have been satisfied or waived, other than conditions     
that cannot be satisfied or waived until the closing, if the average        
trading price of the Global Crossing common stock during the measurement    
period is less than $34.5625, provided that                                 

.  Frontier must give Global Crossing written notice of its intention to
   terminate, which will be effective three business days after delivery
  and which can be withdrawn by Frontier at any time before it becomes
effective                                                         

.  during the two business day period beginning with the delivery of    
that notice, Global Crossing will have the option of providing    
  additional merger consideration to ensure that Frontier shareholders
   receive $63.00 in value, based on the average Global Crossing trading
price, by either:                                                 

1. adjusting the exchange ratio to equal $63.00 divided by the  
average price during the measurement period, rounded to the nearest 
1/10,000,                                                           

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2. paying merger consideration equal to the exchange ratio as in
effect and paying cash to make up the difference between $63.00 and 
the value based on the average trading price, of the Global Crossing
shares to be delivered or                                           

3. using any combination of cash and Global Crossing shares to  
provide $63.00 of value, based on the average trading price of the  
Global Crossing common stock during the measurement period.         

However, Global Crossing can only use cash consideration if the use of  
the cash will not cause the merger to fail to qualify as a tax-free         
reorganization.                                                             

Global Crossing can exercise this option by delivering written notice to    
Frontier at any time during the two business day period. If Global Crossing     
elects to adjust the exchange ratio as described above, then the merger         
agreement will not terminate.                                                   

It is not possible to know until the date on which we calculate the exchange
ratio if the average trading price of the Global Crossing common stock during   
the measurement period will be less than $34.5625. The Frontier board of        
directors has not decided whether it would exercise its right to terminate the  
merger agreement if the average trading price of the Global Crossing common     
stock were less than $34.5625. The Global Crossing board of directors has not   
decided whether it would exercise its related right to increase the merger      
consideration in the event Frontier chooses to terminate the merger agreement.  
We cannot assure you that the Frontier board of directors would exercise its    
right to terminate the merger agreement if the average trading price of the     
Global Crossing common stock were less than $34.5625 and, if the Frontier board 
of directors does elect to terminate the merger agreement, we cannot assure you 
that Global Crossing will elect to increase the merger consideration.           

Since the date of the merger agreement, the Global Crossing common stock has
traded within a range from $32.94 to $64.25. Frontier shareholders should be    
aware that the average trading price will be calculated on the date before the  
satisfaction and waiver of all of the closing conditions, other than those that 
cannot be satisfied or waived until the closing date, based on the average of   
the volume weighted averages of the trading prices of Global Crossing common    
stock for 15 randomly selected trading days during the 30 trading days ended on 
the trading day before the date before the satisfaction and waiver of all of    
the closing conditions, other than those that cannot be satisfied or waived     
until the closing date. Accordingly, because the market price of Global         
Crossing common stock will fluctuate and may increase or decrease during the    
period from the end of the measurement period to the effective time of the      
merger as well as during the period from the effective time of the merger until 
the date certificates representing shares of Global Crossing common stock are   
delivered to Frontier shareholders in exchange for shares of Frontier common    
stock after the completion of the merger, the value of the Global Crossing      
common stock actually received by holders of Frontier common stock may be more  
or less than the average trading price or the value of the Global Crossing      
common stock at the effective time of the merger resulting from the exchange    
ratio, including as the exchange ratio may be adjusted as described above. This 
means that the stated value of $63.00 per share of Frontier common stock may    
not be the actual value of the shares on the closing date or when you receive   
the shares.                                                                     

 Adoption of the merger agreement by the Frontier shareholders at the Frontier
special meeting and approval of the share issuance and the increase in          
authorized shares by the Global Crossing shareholders at the Global Crossing    
annual meeting will give the Frontier board of directors and the Global         
Crossing board of directors, respectively, the power to elect to                

.  complete the merger in the event the average price is less than          
$34.5625, in the case of the Frontier board of directors, or          

.  increase the exchange ratio in the event Frontier elects to exercise its 
termination right, in the case of the Global Crossing board of        
directors,                                                            

without any further action by, or resolicitation of, the Frontier shareholders  
or the Global Crossing shareholders, as the case may be.                        

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Termination fees                                                                

The merger agreement obligates Frontier to pay Global Crossing a termination
fee of $270 million if:                                                         

.  Frontier terminates the merger agreement because its board of directors  
  approves a superior proposal under the circumstances described in clause
(a) of paragraph (4) under "--Termination; Possible exchange ratio    
increase,"                                                            

.  Frontier or Global Crossing terminate the merger agreement because of    
the failure of Frontier shareholders to adopt the merger agreement by 
the required vote and all of the following occur:                     

  1. any time after the date of the merger agreement and before this
termination, an acquisition proposal is made with respect to        
Frontier, and                                                       

2. within 12 months of this termination, Frontier enters into a 
definitive agreement with any third party relating to an acquisition
proposal or an acquisition proposal is completed,                   

.  Global Crossing terminates the merger agreement because the Frontier     
board of directors, before the Frontier special meeting, withdraws or 
modifies in any adverse manner its approval and recommendation of the 
merger or approves or recommends a superior proposal, or              

.  Global Crossing terminates the merger agreement because the merger does  
not occur by March 16, 2000 under the terms described in the first    
  bullet point under paragraph (2) under "--Termination; Possible exchange
ratio increase" or Frontier or Global Crossing terminate the merger   
agreement because any governmental entity does not allow the merger as
described in the second bullet point under paragraph (2) under "--    
 Termination; Possible exchange ratio increase" and all of the following
occur:                                                                

1. at any time after the date of the merger agreement and before
this termination, an acquisition proposal is made with respect to   
Frontier,                                                           

  2. following the existence of that acquisition proposal and before
this termination, Frontier intentionally breaches (and does not cure
after notice of the breach) any of its material covenants or        
agreements in the merger agreement in any material respect and      

3. within 12 months of this termination, Frontier enters into a 
definitive agreement with any third party with respect to an        
acquisition proposal or an acquisition proposal is completed.       

Other expenses                                                                  

All expenses incurred in connection with the merger agreement and the       
transactions contemplated by the merger agreement will be paid by the party     
incurring the expense.                                                          

The merger agreement provides that expenses incurred in connection with the 
filing, printing and mailing of this document will be shared equally by us and  
that if the merger is completed, the surviving corporation will pay, or cause   
to be paid, any and all property or transfer taxes imposed on Frontier or its   
subsidiaries and any real property transfer tax imposed on any holder of shares 
of capital stock of Frontier resulting from the merger.                         

Amendments and waivers                                                          

The parties may amend the merger agreement before the merger, if the        
amendment is in writing signed by the parties. After the shareholder approvals  
of Frontier and Global Crossing are obtained, the parties cannot make any       
amendment to the merger agreement which would require further shareholder       
approval without further approval. The conditions to each party's obligation to 
complete the merger may be waived by the other party in whole or in part to the 
extent permitted by applicable law.                                             

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Alternative merger structure                                                    

The merger agreement provides for an alternative merger structure to be used
to effect the merger under the circumstances described below. The alternative   
merger structure provides for the creation of a new United States holding       
company with two subsidiaries. Frontier would become a wholly owned subsidiary  
of the new United States holding company by merging with one of the new United  
States holding company's subsidiaries and Global Crossing would become a wholly 
owned subsidiary of the new United States holding company through a merger or   
scheme of arrangement. In connection with the alternative merger structure,     
each share of Frontier common stock would be converted into a number of shares  
of the new holding company's common stock equal to the exchange ratio. Each     
share of Global Crossing common stock would be converted into one share of the  
new holding company's common stock. The implementation of the alternative       
merger structure would therefore result in current Frontier shareholders owning 
the same percentage of the new company as they would own of Global Crossing     
under the existing structure except that the new company will be incorporated   
under the laws of a state in the United States rather than Bermuda.             

The merger will be completed in accordance with the structure described     
elsewhere throughout this document as long as a trigger event occurs and        
remains in effect. Under the merger agreement, a trigger event occurs when the  
following conditions have occurred and remain satisfied: (1) Global Crossing    
has completed a qualifying acquisition and (2) counsel to Frontier and Global   
Crossing each confirm that they could render legal opinions as to the tax-free  
nature of the merger. On July 2, 1999, a trigger event occurred. Based on       
existing circumstances, we do not currently believe that the alternative merger 
structure will be required to be effected.                                      

If, however, the alternative merger structure is required to be effected, we
intend to take any action required by law to effect such structure, including,  
if necessary, providing you with additional information regarding the           
alternative merger structure.                                                   

 If we were required to implement the alternative merger structure because the
trigger event was no longer in effect, the date described in the second bullet  
point of paragraph (2) under "--Termination; Possible exchange ratio increase"  
will be 180 days after the date on which the trigger event is no longer in      
effect instead of March 16, 2000.                                               

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Related Agreements  

Stock option agreement                                                          

General                                                                       

Frontier and Global Crossing have entered into a stock option agreement     
giving Global Crossing the right to acquire shares of Frontier. The stock       
option agreement may prevent a third party from completing a pooling of         
interests transaction with Frontier and would make alternative transactions,    
including a merger with another company, significantly more expensive than      
would otherwise be the case. Accordingly, the stock option agreement may        
discourage third parties from proposing alternative transactions that may be    
more advantageous than the merger for Frontier shareholders.                    

The stock option agreement gives Global Crossing an option to purchase      
shares of Frontier common stock at an exercise price of $62.00 per share. The   
maximum number of shares that Global Crossing may purchase under the option is  
19.9% of the shares of Frontier common stock outstanding at the time of         
exercise. Based on the number of shares outstanding on the date of the merger   
agreement, the option allows Global Crossing to purchase 34,291,944 shares.     

We have attached the stock option agreement to this document as Annex B. We 
urge you to read the full text of the stock option agreement.                   

When the option may be exercised                                              

The option will become exercisable if the merger agreement is terminated in 
a circumstance under which Global Crossing would or could be entitled to        
receive a termination fee from Frontier. These circumstances are described      
under "The Merger Agreement--Termination fees." If the merger agreement is      
terminated under circumstances which could result in Global Crossing becoming   
entitled to receive a termination fee described in the second or fourth bullet  
points under "The Merger Agreement--Termination fees," the option will not      
become exercisable unless Frontier enters into a definitive agreement with a    
third party with respect to an acquisition proposal or completes an             
acquisition proposal during the twelve months after termination of the merger   
agreement.                                                                      

Events terminating the right to exercise                                      

The right to exercise the option terminates if we complete the merger. The  
right to exercise the option also terminates in three other circumstances:      

1. 15 months after the option first becomes exercisable,                    

2. termination of the merger agreement under circumstances which do not     
result in Global Crossing becoming entitled to receive a termination fee from   
Frontier, and                                                                   

3. 12 months after termination of the merger agreement under circumstances  
which would result in Global Crossing becoming entitled to receive a            
termination fee under the second or fourth bullet points under "The Merger      
Agreement--Termination fees" unless, during that period, the option becomes     
exercisable.                                                                    

Repurchase                                                                    

.  At the option of Global Crossing. At any time after the termination fee  
is paid or becomes due and payable from Frontier under the merger     
agreement, at Global Crossing's request, Frontier will repurchase the 
 option and all, but not less than all, of the shares of Frontier common
stock issued upon the exercise of the option.                         

.  At the option of Frontier. At any time after the option becomes          
exercisable, Frontier may, at its election, repurchase the option or  
all, but not less than all, of the shares of Frontier common stock    
issued upon the exercise of the option.                               

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The repurchase will be made at a price per share equal to the highest of:   

.  the highest price per share at which a tender or exchange offer for      
Frontier has been completed,                                          

.  the highest price per share to be paid by a third party under an         
agreement with Frontier for an acquisition proposal, and              

.  the highest closing price per Frontier share as reported on the New York 
Stock Exchange during the 60 business days before the date of         
repurchase.                                                           

 In each case, the exercise price for the repurchased options will be deducted
from the total repurchase price paid. The value of any noncash consideration    
will be determined in good faith by an independent nationally recognized        
investment banking firm selected by Global Crossing and reasonably acceptable   
to Frontier.                                                                    

Limitation on total profit                                                    

The total profit that Global Crossing can realize from the stock option     
agreement would be equal to the sum of the following amounts received from:     

.  the sale of shares purchased under the option, less the purchase price   
for those shares,                                                     

.  the repurchase of the option by Frontier, and                            

.  any termination fee received under the merger agreement.                 

The stock option agreement limits Global Crossing's total profit from the   
option and the termination fee to $275 million.                                 

Registration rights                                                           

 Global Crossing may demand on two occasions that Frontier file a registration
statement, including a shelf registration statement, to register the shares of  
Frontier common stock that it may acquire upon the exercise of the option. The  
registration rights terminate two years after the first exercise of the option. 

Adjustments                                                                   

The type and number of option securities will be adjusted appropriately if  
any change in Frontier's common stock occurs involving reclassifications,       
recapitalizations, stock dividends, dividends, split-ups, combinations,         
subdivisions, exchanges or similar events.                                      

Transfer                                                                      

Global Crossing may not transfer the exercise of rights or the option to any
person without Frontier's prior written consent.                                

Voting agreement                                                                

 Principal shareholders of Global Crossing representing over a majority of the
voting power of Global Crossing common stock have agreed with Frontier to be    
present, in person or by proxy, and vote all of the voting securities of Global 
Crossing which are beneficially owned by them or which these shareholders have, 
directly or indirectly, the right to vote, in favor of the increase in the      
number of authorized shares and the share issuance and any action required in   
furtherance of these matters and the merger and, if applicable, the alternative 
merger. These shareholders have also agreed to vote against any action or       
agreement that would reasonably be expected to result in a failure of the       
conditions relating to representations, warranties and covenants of Global      
Crossing to be satisfied. In connection with the execution of the U S WEST      
merger agreement and the amendment to the merger agreement, the shareholders    
reaffirmed these obligations under the Global Crossing voting agreement.        

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As of the date of the Global Crossing voting agreement, these shareholders  
beneficially owned 319,063,570 shares of Global Crossing common stock,          
representing approximately 72% of the voting power of the outstanding Global    
Crossing common stock after giving effect to the voting limitations on 9.5% or  
larger shareholders contained in the Global Crossing bye-laws. The Global       
Crossing voting agreement permits the shareholders to transfer beneficial or    
record ownership of the shares subject to the agreement, so long as the         
transfer does not result in less than 51% of the voting power of the Global     
Crossing shares to be subject to the Global Crossing voting agreement. In that  
case, shareholders can only transfer their shares if the transferee agrees to   
be bound by the Global Crossing voting agreement with respect to the            
transferred shares.                                                             

Each shareholder also agreed in the Global Crossing voting agreement that   
during the period during which the average price of the Global Crossing stock   
will be determined for purposes of calculating the exchange ratio, the          
shareholder will not, and will not announce an intention to:                    

.  acquire any shares of Global Crossing common stock in the open market,   

.  sell any shares of Global Crossing common stock,                         

.  take any other action prohibited by Regulation M under the Securities    
Act of 1933, or                                                       

.  make any announcement which would reasonably be expected to have the     
effect of resulting in a change in the trading prices of the Global   
Crossing common stock.                                                

The Global Crossing voting agreement will terminate on the earliest of      

.  the completion of the merger,                                            

.  the termination of the merger agreement in accordance with its terms,    
and                                                                   

.  the full and irrevocable approval of the increase of authorized shares,  
the share issuance and the alternative merger.                        

Shareholders that are parties to the Global Crossing voting agreement who   
together beneficially own approximately 67.57% of the outstanding voting power  
of the Global Crossing common stock as of July 29, 1999 separately agreed with  
Global Crossing not to sell any shares of Global Crossing common stock until    
the earlier of the closing of the Frontier merger and the termination of the    
merger agreement without Global Crossing's consent which shall not be           
unreasonably withheld.                                                          

 In addition, U S WEST agreed to vote the 39,259,305 shares it acquired in the
tender offer for Global Crossing shares, which was completed on June 18, 1999,  
in favor of the proposals relating to the merger. U S WEST has since returned   
to Global Crossing 2,231,076 shares of Global Crossing common stock in          
connection with the termination of the proposed Global Crossing--U S WEST       
merger. However, U S WEST remains bound to vote the remaining shares of Global  
Crossing common stock it acquired in the tender offer in favor of the proposals 
relating to the merger.                                                         

 As of July 29, 1999, the shareholders that are parties to the Global Crossing
voting agreement together beneficially owned 293,995,036 shares of Global       
Crossing common stock, representing approximately 67.57% of the outstanding     
voting power of the Global Crossing common stock as of that date (after giving  
effect to the voting limitations of large shareholders). In addition, as of     
July 29, 1999, U S WEST owned 37,028,229 shares of Global Crossing common       
stock, representing approximately 8.97% of the outstanding voting power of the  
Global Crossing common stock as of that date.                                   

Because the shares subject to these voting agreements represent more than a 
simple majority of the votes of all outstanding shares of Global Crossing       
common stock, we expect that the proposals relating to the share issuance and   
the increase in the number of authorized shares will be approved at the Global  
Crossing annual meeting, even if no other shareholder votes to approve those    
proposals. The Global Crossing voting agreement is attached as Annex C to this  
document. You should read it entirely.                                          

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Unaudited Pro Forma Condensed Combined Financial Statements 

 The following unaudited pro forma condensed combined financial information of
Global Crossing, Global Marine and Frontier, which we refer to as "Pro Forma    
Global Crossing," has been prepared to demonstrate how these companies or       
businesses might have looked if the merger and merger related transactions had  
been completed as of the dates or at the beginning of the periods presented.    

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 our long distance    
business as a result of combining our companies. 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.                       

 Pursuant to the purchase agreement of Global Marine, Global Crossing acquired
the net assets of Global Marine for approximately $868 million. The unaudited   
translations of Global Marine's sterling amounts into U.S. dollars have been    
translated using convenience translation rates. 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 U.S. dollars at this 
rate or any other rate of exchange.                                             

Pursuant to the terms of the Global Crossing-Frontier merger, each holder of
Frontier common stock will be entitled to receive that number of shares of      
Global Crossing common stock equal to the exchange ratio. The unaudited Pro     
Forma Global Crossing financial statements have been prepared assuming an       
exchange ratio of 1.5750 shares of Global Crossing common stock for each share  
of Frontier common stock outstanding or an estimated purchase price of $11.3    
billion assuming a Global Crossing share price of $40.00 per share, the closing 
price of Global Crossing common stock on August 2, 1999. Fees and expenses      
related to the merger and merger related transactions totaling $95 million are  
included in the Pro Forma Global Crossing information. The actual exchange      
ratio may vary as described in this document. These unaudited pro forma         
condensed combined financial statements are preliminary and subject to change   
based on the review of a final study to determine the fair values of Frontier's 
and Global Marine's net assets.                                                 

These unaudited pro forma condensed combined financial statements should be 
read in conjunction with the historical financial statements of Global          
Crossing, Global Marine and Frontier which, in the case of Global Crossing and  
Global Marine, are included in this document and, in the case of Frontier, are  
incorporated by reference in this document.                                     

 The unaudited pro forma condensed combined financial statements are presented
for comparative purposes only and are not intended to be indicative of actual   
results had the transactions occurred as of the dates indicated above nor do    
they purport to indicate results which may be attained in the future.           

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Pro Forma Global Crossing 
Unaudited Pro Forma Condensed Combined Balance Sheet
as of June 30, 1999 
(in thousands)

                                                        [Enlarge/Download Table]

                                                                                                                     Total    
                                                                   Global Crossing                                 Pro Forma  
                        Global Crossing   Global    Pro Forma        with Global      Frontier     Pro Forma        Global    
                        Historical (1)  Marine (1) Adjustments          Marine     Historical (1) Adjustments      Crossing   
                        --------------- ---------- -----------     --------------- -------------- -----------     ----------- 
                                                                                                                              
ASSETS                                                                                                                        
Current Assets:                                                                                                               
 Cash and cash                                                                                                                
  equivalents.........    $  721,342     $    --    $(268,400)(2)    $  412,942      $   99,453   $  (18,477)(5)  $  318, 918 
                                                      (35,000)(13)                                   (90,000)(4)              
                                                       (5,000)(4)                                    (85,000)(8)              
 Accounts receivable,                                                                                                         
  net.................       132,652       67,572         --            200,224         430,576          --           630,800 
 Inventories and                                                                                                              
  supplies............           --        11,756         --             11,756           7,243          --            18,999 
 Deferred directory                                                                                                           
  costs...............           --           --          --                --              --           --               --  
 Deferred tax assets..           --           --          --                --           13,105          --            13,105 
 Prepaid and other....        51,475       38,284         --             89,759          27,260          --           117,019 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
 Total current                                                                                                                
  assets..............       905,469      117,612    (308,400)          714,681         577,637     (193,477)       1,098,841 
Restricted cash and                                                                                                           
 cash equivalents.....       367,387          --          --            367,387             --           --           367,387 
Accounts receivable...        63,128          --          --             63,128             --           --            63,128 
Capacity available for                                                                                                        
 sale.................       503,878          --          --            503,878             --           --           503,878 
Property, plant and                                                                                                           
 equipment, net.......        59,853      362,141         --            421,994       2,038,457          --         2,460,451 
Construction in                                                                                                               
 process..............       842,439          --          --            842,439             --           --           842,439 
Goodwill and other                                                                                                            
 intangibles, net.....           --        36,150     (36,150)(2)      829, 330         466,851     (466,851)(3)   11,480,897 
                                                      829,330 (2)                                 10,651,567 (3)              
Other assets, net.....       111,767      155,864    (155,864)(13)      111,767         391,493          --           503,260 
Investment in                                                                                                                 
 affiliates...........       184,676       40,357         --            225,033             --           --           225,033 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
 Total Assets.........    $3,038,597     $712,124    $328,916        $4,079,637      $3,474,438   $9,991,239      $17,545,314 
                          ==========     ========   =========        ==========      ==========   ==========      =========== 
LIABILITIES AND                                                                                                               
 SHAREHOLDERS' EQUITY                                                                                                         
Current Liabilities                                                                                                           
 Short-term debt......    $      --      $155,386   $     --         $  155,386      $   10,508   $      --       $   165,894 
 Accrued construction                                                                                                         
  costs...............       158,304          --          --            158,304          16,761          --           175,065 
 Accounts payable and                                                                                                         
  accrued expenses....        95,875       82,396         --            178,271         498,380          --           676,651 
 Other current                                                                                                                
  liabilities.........        47,903       45,371         --             93,274          42,341          --           135,615 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
 Total current                                                                                                                
  liabilities.........       302,082      283,153         --            585,235         567,990          --         1,153,225 
Long term debt........       559,707          --      600,000 (2)     1,159,707       1,631,199          --         2,790,906 
Senior notes..........       796,682          --          --            796,682             --           --           796,682 
Deferred income                                                                                                               
 taxes................        24,167       41,338         --             65,505          50,462     (237,599)(6)     (121,632)
Postretirement and                                                                                                            
 other postemployment                                                                                                         
 benefit obligations..           --           --          --                --           92,049          --            92,049 
Deferred credits and                                                                                                          
 other................        75,377      272,413    (155,864)(13)      191,926             --           --           191,926 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
 Total Liabilities....     1,758,015      596,904     444,136         2,799,055       2,341,700     (237,599)       4,903,156 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
Manditorily Redeemable                                                                                                        
 Preferred Stock......       484,958          --          --            484,958             --           --           484,958 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
Shareholders' equity:                                                                                                         
 Preferred stock......           --           --          --                --           18,294      (18,294)(5)          --  
 Common stock.........         4,361       89,000     (89,000)(2)         4,361         173,270     (170,541)(3)        7,090 
 Other shareholders'                                                                                                          
  equity..............     1,154,816          --          --          1,154,816         640,409     (608,635)(3)   12,513,663 
                                                                                                  10,912,591 (3)              
                                                                                                     (31,774)(7)              
                                                                                                     446,256 (8)              
 Unearned                                                                                                                     
  compensation........       (74,145)         --          --            (74,145)        (31,774)      31,774 (7)      (74,145)
 Treasury stock.......      (209,415)         --          --           (209,415)           (231)         231 (3)     (209,415)
 Retained earnings                                                                                                            
  (accumulated                                                                                                                
  deficit)............       (79,993)      26,220     (26,220)(2)       (79,993)        334,325         (183)(5)      (79,993)
                                                                                                    (304,142)(3)              
                                                                                                     (30,000)(4)              
 Accumulated other                                                                                                            
  comprehensive                                                                                                               
  income..............           --           --          --                --           (1,555)       1,555              --  
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
 Total shareholders'                                                                                                          
  equity..............       795,624      115,220    (115,220)          795,624       1,132,738   10,228,838       12,157,200 
                          ----------     --------   ---------        ----------      ----------   ----------      ----------- 
  Total liabilities                                                                                                           
   and shareholders'                                                                                                          
   equity.............    $3,038,597     $712,124   $ 328,916        $4,079,637      $3,474,438   $9,991,239      $17,545,314 
                          ==========     ========   =========        ==========      ==========   ==========      =========== 

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Pro Forma Global Crossing 
Unaudited Pro Forma Condensed Combined Statement of Operations
for the Six Months Ended June 30, 1999
(in thousands, except share and per share information)

                                                        [Enlarge/Download Table]

                                                                     Global Crossing                              
                          Global Crossing  Global     Pro Forma        with Global     Frontier     Pro Forma     
                           Historical(1)  Marine(1)  Adjustments         Marine      Historical(1) Adjustments    
                          --------------- ---------  -----------     --------------- ------------- -----------    
                                                                                                                  
OPERATING REVENUES......    $   368,461   $173,498    $    --          $   541,959    $ 1,321,597   $     --      
                            -----------   --------    --------         -----------    -----------   ---------     
OPERATING EXPENSES:                                                                                               
 Operating, selling,                                                                                              
  general and                                                                                                     
  administrative........        257,356    127,165         --              384,521      1,045,999         --      
 Stock related                                                                                                    
  expense...............         26,074        --          --               26,074            --          --      
 Depreciation and                                                                                                 
  amortization..........          4,200     13,629        (539)(2)          27,657        128,056     (17,279)(3) 
                                                        10,367 (2)                                    177,526 (3) 
                            -----------   --------    --------         -----------    -----------   ---------     
                                287,630    140,794       9,828             438,252      1,174,055     160,247     
                            -----------   --------    --------         -----------    -----------   ---------     
OPERATING INCOME                                                                                                  
 (LOSS).................         80,831     32,704      (9,828)            103,707        147,542    (160,247)    
EQUITY IN INCOME (LOSS)                                                                                           
 OF AFFILIATES..........         (5,542)     4,539         --               (1,003)         9,687         --      
Other income (expense):                                                                                           
 Interest expense.......        (46,454)    (6,869)    (24,000)(9)         (77,323)       (29,850)        --      
 Interest income........         31,666        511         --               32,177          3,134         --      
 Other income                                                                                                     
  (expense).............         (7,683)       143         --               (7,540)         2,173         --      
                            -----------   --------    --------         -----------    -----------   ---------     
Income (loss) before                                                                                              
 taxes and cumulative                                                                                             
 effect of change in                                                                                              
 accounting principle...         52,818     31,028     (33,828)             50,018        132,686    (160,247)    
 Provision (benefit)                                                                                              
  for income taxes......        (30,038)   (11,885)     10,128 (14)        (31,795)       (55,411)        --      
                            -----------   --------    --------         -----------    -----------   ---------     
Income (loss) before                                                                                              
 cumulative effect of                                                                                             
 change in accounting                                                                                             
 principle..............         22,780     19,143     (23,700)             18,223         77,275    (160,247)    
 Preferred stock                                                                                                  
  dividends.............        (27,241)       --          --              (27,241)          (506)        506 (10)
 Redemption of                                                                                                    
  preferred stock.......            --         --          --                  --             --         (183)(5) 
                            -----------   --------    --------         -----------    -----------   ---------     
Income (loss) applicable                                                                                          
 to common shareholders                                                                                           
 before cumulative                                                                                                
 change in accounting                                                                                             
 principle (Basic)......         (4,461)    19,143     (23,700)             (9,018)        76,769    (159,924)    
 Diluted earnings                                                                                                 
  adjustment............            --         --          --                  --             180        (180)(11)
                            -----------   --------    --------         -----------    -----------   ---------     
Income (loss) applicable                                                                                          
 to common shareholders                                                                                           
 before cumulative                                                                                                
 change in accounting                                                                                             
 principle (Diluted)....    $    (4,461)  $ 19,143    $(23,700)        $    (9,018)   $    76,949   $(160,104)    
                            ===========   ========    ========         ===========    ===========   =========     
Income (loss) per common                                                                                          
share:                                                                                                            
 Income (loss)                                                                                                    
  applicable to common                                                                                            
  shareholders before                                                                                             
  cumulative effect of                                                                                            
  change in accounting                                                                                            
  principle                                                                                                       
   Basic................    $     (0.01)                               $     (0.02)   $      0.45                 
                            ===========                                ===========    ===========                 
   Diluted..............    $     (0.01)                               $     (0.02)   $      0.43                 
                            ===========                                ===========    ===========                 
 Shares used in                                                                                                   
  computing information                                                                                           
  applicable to common                                                                                            
  shareholders                                                                                                    
   Basic................    412,000,658                                412,000,658    172,047,956                 
                            ===========                                ===========    ===========                 
   Diluted..............    412,000,658                                412,000,658    177,273,442                 
                            ===========                                ===========    ===========                 

                           Total Pro                                                                              
                             Forma                                                                                
                            Global                                                                                
                           Crossing                                                                               
                          ----------------                                                                        
                                                                                                                  
OPERATING REVENUES......  $ 1,863,556                                                                             
                          ----------------                                                                        
OPERATING EXPENSES:                                                                                               
 Operating, selling,                                                                                              
  general and                                                                                                     
  administrative........    1,430,520                                                                             
 Stock related                                                                                                    
  expense...............       26,074                                                                             
 Depreciation and                                                                                                 
  amortization..........      315,960                                                                             
                          ----------------                                                                        
                            1,772,554                                                                             
                          ----------------                                                                        
OPERATING INCOME                                                                                                  
 (LOSS).................       91,002                                                                             
EQUITY IN INCOME (LOSS)                                                                                           
 OF AFFILIATES..........        8,684                                                                             
Other income (expense):                                                                                           
 Interest expense.......     (107,173)                                                                            
 Interest income........       35,311                                                                             
 Other income                                                                                                     
  (expense).............       (5,367)                                                                            
                          ----------------                                                                        
Income (loss) before                                                                                              
 taxes and cumulative                                                                                             
 effect of change in                                                                                              
 accounting principle...       22,457                                                                             
 Provision (benefit)                                                                                              
  for income taxes......      (87,206)                                                                            
                          ----------------                                                                        
Income (loss) before                                                                                              
 cumulative effect of                                                                                             
 change in accounting                                                                                             
 principle..............      (64,749)                                                                            
 Preferred stock                                                                                                  
  dividends.............      (27,241)                                                                            
 Redemption of                                                                                                    
  preferred stock.......         (183)                                                                            
                          ----------------                                                                        
Income (loss) applicable                                                                                          
 to common shareholders                                                                                           
 before cumulative                                                                                                
 change in accounting                                                                                             
 principle (Basic)......      (92,173)                                                                            
 Diluted earnings                                                                                                 
  adjustment............          --                                                                              
                          ----------------                                                                        
Income (loss) applicable                                                                                          
 to common shareholders                                                                                           
 before cumulative                                                                                                
 change in accounting                                                                                             
 principle (Diluted)....  $   (92,173)                                                                            
                          ================                                                                        
Income (loss) per common                                                                                          
share:                                                                                                            
 Income (loss)                                                                                                    
  applicable to common                                                                                            
  shareholders before                                                                                             
  cumulative effect of                                                                                            
  change in accounting                                                                                            
  principle                                                                                                       
   Basic................  $     (0.13)                                                                            
                          ================                                                                        
   Diluted..............  $     (0.13)                                                                            
                          ================                                                                        
 Shares used in                                                                                                   
  computing information                                                                                           
  applicable to common                                                                                            
  shareholders                                                                                                    
   Basic................  684,883,385 (12)                                                                        
                          ================                                                                        
   Diluted..............  684,883,385 (12)                                                                        
                          ================                                                                        

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Pro Forma Global Crossing 
Unaudited Pro Forma Condensed Combined Statement of Operations
for the Year Ended December 31, 1998
(in thousands, except share and per share information)

                                                        [Enlarge/Download Table]

                                                                                                                   Total        
                             Global                                   Global                                     Pro Forma      
                            Crossing      Global    Pro Forma      Crossing with    Frontier     Pro Forma        Global        
                         Historical (1) Marine (1) Adjustments     Global Marine Historical (1) Adjustments      Crossing       
                         -------------- ---------- -----------     ------------- -------------- -----------     -----------     
                                                                                                                                
OPERATING REVENUES.....   $   424,099    $347,335   $    --         $   771,434   $ 2,593,558    $     --       $ 3,364,992     
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
OPERATING EXPENSES:                                                                                                             
 Operating, selling,                                                                                                            
  general and                                                                                                                   
  administrative.......       264,781     233,209        --             497,990     2,050,356          --         2,548,346     
 Termination of                                                                                                                 
  Advisory                                                                                                                      
  Services Agreement...       139,669         --         --             139,669           --           --           139,669     
 Stock related                                                                                                                  
  expense..............        39,374         --         --              39,374           --           --            39,374     
 Depreciation and                                                                                                               
  amortization.........           --       38,730     (1,318)(2)         58,145       225,806      (36,002)(3)      603,001     
                                                      20,733 (2)                                   355,052 (3)                  
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
                              443,824     271,939     19,415            735,178     2,276,162      319,050        3,330,390     
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
OPERATING INCOME                                                                                                                
 (LOSS)................       (19,725)     75,396    (19,415)            36,256       317,396     (319,050)          34,602     
EQUITY IN INCOME (LOSS)                                                                                                         
 OF AFFILIATES.........        (2,508)      4,732        --               2,224        16,711          --            18,935     
Other income (expense):                                                                                                         
 Interest expense......       (42,880)    (11,176)   (48,000)(9)       (102,056)      (55,318)         --          (157,374)    
 Interest income.......        29,986       3,793        --              33,779         5,084          --            38,863     
 Other income                                                                                                                   
  (expense)............           --          --         --                 --         23,230          --            23,230     
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
Income (loss) before                                                                                                            
 taxes, extraordinary                                                                                                           
 item and cumulative                                                                                                            
 effect of change in                                                                                                            
 accounting principle..       (35,127)     72,745    (67,415)           (29,797)      307,103     (319,050)         (41,744)    
 Provision (benefit)                                                                                                            
  for income taxes.....       (33,067)    (25,693)    20,256 (14)       (38,504)     (129,560)         --          (168,064)    
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
Income (loss) before                                                                                                            
 extraordinary item and                                                                                                         
 cumulative effect of                                                                                                           
 change in accounting                                                                                                           
 principle.............       (68,194)     47,052    (47,159)           (68,301)      177,543     (319,050)        (209,808)    
 Preferred stock                                                                                                                
  dividends............       (12,681)        --         --             (12,681)       (1,005)       1,005 (10)     (12,681)    
 Redemption of                                                                                                                  
  preferred stock......       (34,140)        --         --             (34,140)          --          (183)(5)      (34,323)    
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
Income (loss)                                                                                                                   
 applicable to common                                                                                                           
 shareholders before                                                                                                            
 extraordinary item and                                                                                                         
 cumulative change in                                                                                                           
 accounting principle                                                                                                           
 (Basic)...............      (115,015)     47,052    (47,159)          (115,122)      176,538     (318,228)        (256,812)    
 Diluted earnings                                                                                                               
  adjustment...........           --          --         --                 --            360         (360)(11)         --      
                          -----------    --------   --------        -----------   -----------    ---------      -----------     
Income (loss)                                                                                                                   
 applicable to common                                                                                                           
 shareholders before                                                                                                            
 extraordinary item and                                                                                                         
 cumulative change in                                                                                                           
 accounting principle                                                                                                           
 (Diluted).............   $  (115,015)   $ 47,052   $(47,159)       $  (115,122)  $   176,898    $(318,588)     $  (256,812)    
                          ===========    ========   ========        ===========   ===========    =========      ===========     
Income (loss) per                                                                                                               
 common share:                                                                                                                  
 Income (loss)                                                                                                                  
  applicable to common                                                                                                          
  shareholders before                                                                                                           
  extraordinary item                                                                                                            
  and cumulative effect                                                                                                         
  of change in                                                                                                                  
  accounting                                                                                                                    
  principle............                                                                                                         
 Basic.................   $     (0.32)                              $     (0.32)  $      1.03                   $     (0.41)    
                          ===========                               ===========   ===========                   ===========     
 Diluted...............   $     (0.32)                              $     (0.32)  $      1.02                   $     (0.41)    
                          ===========                               ===========   ===========                   ===========     
 Shares used in                                                                                                                 
  computing information                                                                                                         
  applicable to                                                                                                                 
  common shareholders                                                                                                           
 Basic.................   358,735,340                               358,735,340   170,625,733                   631,618,067 (12)
                          ===========                               ===========   ===========                   ===========     
 Diluted...............   358,735,340                               358,735,340   173,940,531                   631,618,067 (12)
                          ===========                               ===========   ===========                   ===========     

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Pro Forma Global Crossing 
Notes to Unaudited Pro Forma Condensed Combined Financial Statements
1. These columns represent the historical results of operations and financial 
position. With respect to the information included in the Unaudited Pro 
Forma Condensed Combined Statement of Operations for the year ended     
 December 31, 1998, the Global Marine information is for the twelve months
ended March 31, 1999.                                                   

2. These adjustments reflect the elimination of Global Marine's shareholder's 
equity accounts, the excess consideration over the net assets acquired  
 (goodwill) and the related amortization expense. The preliminary goodwill
is calculated as follows (in thousands):                                

                                                                [Download Table]
                                                                           
Purchase price........................................            $868,400 
Lease termination fees................................              35,000 
Estimated Global Crossing transaction costs...........               5,000 
                                                                  -------- 
Estimated total consideration.........................             908,400 
Historical net tangible book value of Global Marine:                       
  Historical Global Marine net assets at June 30,                          
   1999............................................... $(115,220)          
  Historical goodwill and other intangibles, net......    36,150           
                                                       ---------           
                                                                   (79,070)
                                                                  -------- 
Preliminary goodwill..................................            $829,330 
                                                                  ======== 

Global Crossing paid (Pounds)550 million (approximately $868 million) in    
connection with the transaction. The Company partially financed the         
acquisition of Global Marine through the incurrence of debt in the amount   
of $600 million with an interest rate of approximately 8%. Global Crossing  
has tentatively considered the carrying value of the acquired assets to     
approximate fair value, with all excess of such acquisition costs being     
attributable to goodwill. Global Crossing is in the process of fully        
evaluating the assets acquired and, as a result, the purchase price         
allocation among the tangible and intangible (and their related useful      
lives) assets acquired may change. Goodwill associated with the transaction 
is currently anticipated to be amortized over a 40-year life.               

3. These adjustments reflect the elimination of Frontier's shareholders'      
equity accounts, the excess consideration over the net assets acquired  
 (goodwill) and the related amortization expense. The preliminary goodwill
is calculated as follows (in thousands, except per share amounts):      

                                                                [Download Table]
                                                                           
Shares of Frontier common stock outstanding at                             
 June 30, 1999...................................                  173,270 
Less: Treasury shares............................                      (11)
                                                               ----------- 
Shares of Frontier to be exchanged...............                  173,259 
Frontier exchange ratio..........................                   1.5750 
                                                               ----------- 
Shares of Global Crossing to be issued...........                  272,883 
Assumed Global Crossing market price at exchange                           
 date............................................              $     40.00 
                                                               ----------- 
                                                                10,915,320 
Acceleration of stock option vesting and other                             
 compensation....................................                  531,256 
Tax benefit related to the acceleration of                                 
 unearned compensation and vesting of stock                                
 options.........................................                 (237,599)
Estimated Global Crossing transaction costs......                   60,000 
                                                               ----------- 
Estimated total consideration....................               11,268,977 

Historical net tangible book value of Frontier                             
  Historical Frontier net assets at June 30,                               
   1999.......................................... $(1,132,738)             
  Historical goodwill and other intangibles,                               
   net...........................................     466,851              
  Estimated Frontier transactions costs..........      30,000              
  Preferred stock redemption.....................      18,477              
                                                  -----------              
                                                                  (617,410)
                                                               ----------- 
Preliminary goodwill.............................              $10,651,567 
                                                               =========== 

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Pro Forma Global Crossing 
Notes to Unaudited Pro Forma Condensed Combined Financial Statements--
(Continued) 

Global Crossing will issue 272,883,000 shares of its common stock at an     
assumed ratio of 1.5750 shares of Global Crossing common stock for each     
share of Frontier common stock outstanding assuming a market price of       
Global Crossing common stock of $40.00 per share. The actual exchange ratio 
may vary as described in this document. Global Crossing has tentatively     
considered the carrying value of the acquired assets to approximate their   
fair value, with all of the excess of such acquisition costs being          
attributable to goodwill. Global Crossing is in the process of fully        
evaluating the assets to be acquired and, as a result, the purchase price   
allocation among the tangible and intangible (and their related useful      
lives) assets acquired may change. Goodwill associated with the transaction 
is currently anticipated to be amortized over a 40-year life. Based upon a  
preliminary valuation, the Company estimates that the purchase price        
allocation among the tangible and intangible assets will result in a        
composite useful life of approximately 30 years.                            

4. The pro forma financial statements give effect to an estimated $60 million 
and $30 million in direct transaction costs on behalf of Global Crossing
and Frontier, respectively, in connection with the merger. Also, Global 
 Crossing incurred approximately $5 million of direct transaction costs in
connection with the Global Marine acquisition.                          

5. These adjustments represent the redemption of Frontier's 5.00%, 5.65%,     
4.60% and 5.50% Series redeemable preferred stock prior to completion of
the merger at their respective premiums of the total amount outstanding.
The preferred stock was redeemed on July 1, 1999.                       

6. This adjustment represents the deferred tax benefit relating to Frontier's 
unearned compensation and the acceleration of Frontier's stock options  
   based upon Global Crossing's effective tax rate for the year ended December
31, 1998.                                                               

7. This adjustment represents the effect of the accelerated vesting of        
Frontier's unearned compensation as a result of the merger.             

8. This adjustment records the excess fair value of vested stock options      
 issued by Global Crossing in exchange for vested and unvested outstanding
options of Frontier and other compensation.                             

9. This amount reflects the assumed interest expense, assuming 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.     

10. 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.                                      

11. To eliminate diluted earnings adjustment due to the combined net loss       
position.                                                               

12. Pro forma per share data are based on the number of Global Crossing common  
shares that would have been outstanding had the merger occurred at the  
earliest date presented.                                                

13. This adjustment represents the termination of certain lease arrangements    
due to change of control provisions and related costs.                  

14. These adjustments represent the tax benefit resulting from the interest     
 expense assumed in connection with the debt issued for the acquisition of
Global Marine.                                                          

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THE COMPANIES 

Global Crossing Ltd.

The following briefly describes the business of Global Crossing. Additional 
information regarding Global Crossing is contained in its filings with the      
Securities and Exchange Commission pursuant to the Securities Exchange Act of   
1934. See "Where You Can Find More Information" on page 171.                    

Overview                                                                        

Global Crossing is building the world's first independent global network of 
state-of-the-art Internet and long distance telecommunications facilities       
utilizing a combination of undersea and terrestrial digital fiber optic cable   
systems (the "Global Crossing network"). Global Crossing offers "one-stop       
shopping" for its customers to multiple destinations worldwide and currently    
operates as a "carriers' carrier", providing tiered pricing and segmented       
products to licensed providers of international telecommunications services.    
Capacity on the Global Crossing network is offered to all customers on an open, 
equal access basis. The systems completed or under development will form a      
state-of-the-art interconnected worldwide high capacity fiber optic network:    
Atlantic Crossing ("AC-1") and Atlantic Crossing-2 ("AC-2"), undersea systems   
connecting the United States and Europe; Pacific Crossing ("PC-1"), an undersea 
system connecting the United States and Asia; Mid-Atlantic Crossing ("MAC"), an 
undersea system connecting the eastern United States and the Caribbean; Pan     
American Crossing ("PAC"), a primarily undersea system connecting the western   
United States, Mexico, Panama, Venezuela and the Caribbean; South American      
Crossing ("SAC"), an undersea and terrestrial system connecting the major       
cities of South America to MAC, PAC and the rest of the Global Crossing         
network; Pan European Crossing ("PEC"), a primarily terrestrial system          
connecting 25 European cities to AC-1; and a terrestrial system to be operated  
by Global Access Ltd. connecting certain cities in Japan to PC-1 ("GAL"). The   
undersea component of this initial portion of the Global Crossing network       
totals 74,700 km, and the terrestrial component adds 17,800 km, for a total of  
92,500 km. In addition to the Global Crossing--Frontier merger, Global Crossing 
is in the process of developing several new undersea and terrestrial cable      
systems and evaluating other business development opportunities which will      
complement the Global Crossing network.                                         

Recent developments                                                             

On May 16, 1999, Global Crossing entered into an agreement to merge with U S
WEST. As part of the transaction, U S WEST made a cash tender offer for         
approximately 9.49% of Global Crossing common stock. The tender offer was       
completed, with U S WEST acquiring 39,259,305 shares, on June 18, 1999. On July 
18, 1999, Global Crossing and U S WEST agreed to terminate their merger         
agreement, and U S WEST agreed to merge with Qwest. As a result, U S WEST paid  
Global Crossing a termination fee of $140 million in cash and returned          
2,231,075 shares of Global Crossing common stock purchased in the 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 Global Crossing for this capacity  
of $140 million over the next two years.                                        

On July 5, 1999, Global Crossing announced an agreement with the government 
of the Republic of Ireland to build an undersea fiber optic cable system that   
will link two telehouses in Dublin, via two diverse fiber cables, to cities in  
Europe and North America through the Global Crossing network. The Irish         
government will be the system's anchor customer under an $80-million capacity   
purchase agreement. Global Crossing expects to provide installation and         
maintenance for the undersea portion of the Irish system, which will form part  
of PEC, through its recently acquired Global Marine subsidiary.                 

 On July 2, 1999, Global Crossing acquired the Global Marine business of Cable
& Wireless in a transaction valued at approximately $868 million, consisting of 
a combination of cash and assumed indebtedness. Global Marine currently         
provides services, including maintenance under a number of long-term contracts, 
to cables built by more than 100 carriers and is the world's largest undersea   
cable installation and maintenance company with a fleet of 13 cable ships,      
representing approximately 33 percent of the world's total, 21 submersible      
vehicles and 1,200 employees servicing approximately 35 percent of the world's  
undersea cable miles. Global Crossing initially financed the acquisition with   
committed bank financing in the amount of approximately $600 million and the    
remainder with cash on hand.                                                    

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Also on July 2, 1999, Global Crossing entered into a $3 billion senior      
secured corporate credit facility with a group of several lenders and The Chase 
Manhattan Bank as administrative agent. The facility will be utilized to        
finance or refinance construction of some of Global Crossing's cable systems    
previously anticipated to be financed on a per-system basis, to fund future     
growth of Global Crossing and for general corporate purposes. On July 7, 1999,  
Global Crossing, through Global Crossing Holdings, borrowed amounts under this  
facility sufficient to retire the existing credit facilities for the AC-1 and   
MAC systems and the facility provided by Lucent relating to the PEC and SAC     
systems, as well as to replace the initial debt incurred in connection with the 
acquisition of Global Marine.                                                   

On June 4, 1999, Global Crossing announced that it had 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 connecting more than two dozen coastal-country landing  
points and, through terrestrial fiber, microwave or satellite facilities,       
additional countries without landing points, including interior countries.      
Global Crossing will provide marine operations through its new Global Marine    
subsidiary. Although Global Crossing does not intend to make an equity          
investment in this system, it expects to receive more than $100 million in      
revenue for its services.                                                       

Business activity                                                               

The business of Global Crossing is designed to meet the varying needs of the
global telecommunications market. Global Crossing offers customers the ability  
to purchase capacity on demand and by doing so (1) eliminating their need to    
commit the substantial capital which would be required to build cable capacity  
and (2) decreasing the risks associated with forecasting their future capacity  
requirements. Compared with traditional cable systems, Global Crossing offers   
more comprehensive, flexible and low-cost purchasing alternatives designed to   
meet current market requirements of international carriers and Internet Service 
Providers ("ISPs"), including direct international city-to-city connectivity,   
the ability to purchase capacity periodically and discounts based upon          
aggregate volume purchased on the Global Crossing network.                      

Each of the systems completed or under development is upgradable through the
addition of optical and electronic equipment to capacities significantly beyond 
its initial capacity at a fraction of the original system cost. These upgrades  
are expected to lead to lower unit cost of capacity and lower prices, resulting 
in significant growth in market demand for telecommunications capacity. In      
addition, Global Crossing is currently evaluating other undersea and            
terrestrial cable projects intended to further its strategy of developing an    
integrated global network to serve more than 100 of the world's largest         
metropolitan communications markets. Global Crossing's announced network,       
including Frontier, will connect 160 cities worldwide.                          

Global Crossing anticipates that future revenues, beyond those obtained from
the sale of the initial capacity on its first eight cable systems, from its     
Global Marine operations and through its merger with Frontier, will come from   
several sources. First, since each of the systems Global Crossing is building   
is upgradable, this additional capacity can be sold. Global Crossing also       
expects to build new systems providing service to additional geographic areas.  
In addition, if the full upgradable capacity of its initial systems is reached, 
Global Crossing expects to build or acquire additional systems to meet future   
demand.                                                                         

As its global network is developed, Global Crossing expects to generate     
additional revenues by broadening its product line to include many forms of     
services. For example, Global Crossing anticipates that additional revenue      
opportunities will be generated by expansion into the U.S. long-distance        
market, development of a global toll-free calling and calling card market,      
commencement of web hosting and IP application services and growth of city-to-  
city connectivity services and local building-to-building services to key       
customers.                                                                      

Global Crossing's predecessor, Global Crossing Ltd., LDC, which has been    
renamed as Global Crossing (Cayman) Ltd. ("Old Global Crossing"), was formed in 
March 1997 to capitalize on the accelerating growth of international voice and  
data telecommunications traffic. The significant increase in Internet usage and 
other bandwidth-intensive applications and the growing use of corporate         
networks have substantially increased the                                       

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demand for international fiber optic cable capacity. The proliferation of       
telecommunications service providers due, in large part, to industry            
deregulation and privatization of foreign telecommunications companies has      
further contributed to increased demand for such international cable capacity.  
Additionally, Global Crossing believes other technological developments, such   
as improvements in "last mile" access technology, including xDSL, cable modems, 
broadband wireless technology and the increasing video content of Internet      
applications, will result in further capacity demand growth.                    

Global Crossing started development of the Global Crossing network in March 
1997, when Global Crossing contracted for the construction of AC-1, a 14,300 km 
digital fiber optic undersea cable system that links New York, the United       
Kingdom, the Netherlands and Germany. This system offered 40 gigabytes per      
second ("Gbps") of initial service capacity, upgradable to a minimum of 80      
Gbps. AC-1 started service on its United States to United Kingdom segment in    
May 1998, and the full system, consisting of a four fiber pair self-healing     
ring, was completed in February 1999.                                           

In April 1998, Global Crossing entered into a joint venture which contracted
for the construction of PC-1, a 21,000 km digital fiber optic undersea cable    
system that will link the United States and Japan and will initially offer 80   
Gbps of service capacity, upgradable to a minimum of 160 Gbps. PC-1, consisting 
of a four fiber pair self-healing ring, is scheduled to start initial service   
in December 1999. In June 1998, Global Crossing contracted for the construction 
of MAC, a 7,500 km digital fiber optic undersea cable system consisting of a    
two fiber pair self-healing ring that will connect New York, Florida and the    
Caribbean and will initially offer 20 Gbps of service capacity, upgradable to a 
minimum of 40 Gbps. In addition, in July 1998, Global Crossing contracted for   
the construction of PAC, an 8,900 km two fiber pair digital undersea cable that 
will connect California, Mexico, Panama, Venezuela and the Caribbean and will   
initially offer 20 Gbps of service capacity, upgradable to a minimum of 40      
Gbps. In March 1999, Global Crossing announced SAC, a 16,000 km, four fiber     
pair self-healing ring undersea cable and 2,000 km four fiber pair terrestrial  
system that upon completion will link the major cities of South America to the  
rest of the Global Crossing network through MAC and PAC and will initially      
offer 40 Gbps of service capacity upgradable to a minimum of 80 Gbps. In        
connection with PAC, Global Crossing owns a 49% interest in a joint venture     
company that will provide approximately 3,000 km of terrestrial connectivity in 
Mexico. Global Crossing is also developing PEC, an 11,000 km primarily          
terrestrial system with 24 to 72 fiber pairs that, upon completion, will        
consist of five self-healing rings linking 25 European cities with AC-1. Global 
Crossing also obtained a 49% economic interest in Global Access Ltd., which is  
constructing GAL, a 1,300 km fiber optic terrestrial system that will connect   
PC-1 at its Japanese landing points in Shima and Ajigaura with Tokyo, Osaka and 
Nagoya. Finally, in March 1999, Global Crossing announced its intention to      
develop and construct AC-2, an additional 7,000 km eight fiber pair cable       
connecting the United States to Europe. AC-2 will be integrated with the two    
cables of AC-1, adding a third high-capacity cable across the Atlantic for the  
Global Crossing network and providing AC-2 with self-healing capabilities.      

Once completed, the undersea and terrestrial segments of the Global Crossing
network will form an integrated worldwide network with multiple access points   
offering low-cost capacity. In addition to the announced segments of the Global 
Crossing network, Global Crossing has made, and expects to continue to make,    
acquisitions of fiber capacity which complement the Global Crossing fiber optic 
network and which address customer demands for global city-to-city              
connectivity.                                                                   

The Global Crossing network                                                     

 As part of Global Crossing's mission to create an independent, global, state-
of-the-art fiber optic cable network, connecting major cities worldwide, the    
Global Crossing network is being engineered and constructed as an integrated    
network along the most heavily trafficked international corridors in the world  
with undersea networks, including AC-1 and AC-2 (United States to Europe) and   
PC-1 (United States to Asia). Furthermore, Global Crossing plans to build and   
integrate terrestrial networks into this global network structure, including    
PEC (trans-Europe), GAL (trans-Japan), SAC (South America) and a terrestrial    
system in Mexico. MAC, SAC and PAC will directly connect the Caribbean, South   
America and Central America to the network. Of the fiber optic cable systems    
currently operational or under development, AC-1, AC-2, MAC, PAC and PEC are    
wholly-owned projects, while PC-1 and GAL are being developed through joint     
ventures with one or more partners, principally Marubeni. Global Crossing has a 
58% economic interest in PC-1 and a 49% economic interest in                    

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Global Access Ltd., which is constructing GAL. Marubeni will manage the         
development, sales and operations associated with GAL. The undersea portion of  
SAC is currently planned to be wholly owned, while parts of the terrestrial     
portion are expected to be constructed through joint-venture arrangements.      
Terrestrial connectivity to PAC in Mexico will also be developed through a      
joint venture.                                                                  

 Global Crossing has successfully marketed capacity on its systems to licensed
telecommunications providers, including post, telephone and telegraph companies 
("PTTs"), ISPs and established and emerging telecommunications companies.       
Global Crossing customers now total more than 44 international                  
telecommunications carriers, including AT&T, MCI Worldcom Inc., Deutsche        
Telekom AG, GTE, Cable & Wireless, Equant NV, Qwest, Teleglobe Canada Inc.,     
Swisscom AG, PTT Telecom BV, Telia AB, Level 3 Communications, Inc. and a       
number of emerging telecommunications companies.                                

The following table contains information regarding the system cost, initial 
ready for service ("RFS") date and ownership structure of the Global Crossing   
systems. Information relating to AC-1 is based upon historical results, while   
information for all other systems is estimated.                                 

                                                        [Enlarge/Download Table]

        System Cost(1)                                                                             
System    (millions)                   RFS Date(1)                        Ownership Structure      
------  -------------- -------------------------------------------- -------------------------------
                                                                                                   
AC-1        $  975               February 1999 (Complete)                    Wholly Owned          
AC-2           750                March 2001 (Complete)                      Wholly Owned          
PC-1         1,200               December 1999 (Phase I)                     Joint Venture         
                                  March 2000 (Complete)                                            
MAC            295     December 1999 (Phase I--New York to Florida)          Wholly Owned          
                                   May 2000 (Complete)                                             
PAC            580               February 2000 (Phase I)                Wholly Owned (undersea)    
                                                                    Joint Venture (some terrestrial
                                                                               portions)           
SAC          1,130               December 2000 (Phase I)                Wholly Owned (undersea)    
                                  March 2001 (Complete)             Joint Venture (some terrestrial
                                                                               portions)           
PEC            950               December 1999 (Phase I)                     Wholly Owned          
                                 December 2000 (Complete)                                          
GAL            190               December 1999 (Phase I)                     Joint Venture         
            ------                                                                                 
            $6,070                                                                                 
            ======                                                                                 

--------                                                                        
(1) Total system costs include anticipated financing costs, but exclude the     
   costs of potential future upgrades (other than the initial AC-1 upgrades to
   140 Gbps) and any amount capitalized with respect to the warrants issued in
   exchange for the rights to some of these systems. See Note 10 to the Global
 Crossing audited consolidated financial statements. Certain factors, such
  as increases in interest rates and delays in construction, could result in
higher actual costs or later RFS dates than currently estimated.        

Atlantic Crossing                                                               

AC-1, Global Crossing's first undersea fiber optic cable in the Atlantic    
region, is a 14,300 km 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. AC-1 is equipped with state-of-the-art    
DWDM, and the full ring initially offered 40 Gbps of service capacity,          
upgradable to a minimum of 80 Gbps using DWDM technology. AC-1 started service  
on its United States to United Kingdom segment during May 1998, and the full    
system was completed during February 1999.                                      

The total cost of AC-1 excluding upgrade payments was approximately $750    
million. In October 1998, Global Crossing entered into a $50 million contract   
with Tyco Submarine System Ltd. ("TSSL") to upgrade AC-1 capacity from 40 Gbps  
to 80 Gbps, which upgrade is expected to be completed by the end of August      
1999. In August 1999, Global Crossing entered into a second contract with TSSL  
to further upgrade AC-1 capacity to 140 Gbps. In addition to the contracts with 
TSSL for construction of the system, Global Crossing                            

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has entered into other agreements with TSSL for services and support associated 
with operations, administration and maintenance of the system.                  

On March 24, 1999, Global Crossing announced its intention to develop and   
construct AC-2, an additional eight fiber pair cable connecting the United      
States to Europe. AC-2 will be integrated with the two cables of AC-1, adding a 
third high-capacity cable across the Atlantic for the Global Crossing network   
and providing AC-2 with self-healing capabilities. The new cable will cost      
approximately $750 million and is expected to be in service in March 2001. AC-2 
would significantly increase the capacity that Global Crossing would be able to 
offer customers on the transatlantic route.                                     

Pacific Crossing                                                                

PC-1, Global Crossing's first undersea fiber optic cable in the Pacific     
region, is being developed as a 21,000 km, four fiber pair self-healing ring.   
When completed, it will connect California and Washington in the western United 
States with two landing sites in Japan. PC-1 is designed to operate initially   
at 80 Gbps of service capacity, upgradable to a minimum of 160 Gbps, using DWDM 
technology.                                                                     

 In April 1998, Global Crossing executed a construction contract with TSSL for
the construction of PC-1, which provides for a system completion date of July   
2000 (now accelerated to March 2000) at a total cost of approximately $1,200    
million, excluding potential future upgrades and amounts capitalized with       
respect to warrants issued in exchange for the rights to construct PC-1. Equity 
investments in PC-1 are currently estimated at $400 million of which Global     
Crossing will provide approximately $231 million, with the remaining $800       
million financed through incurrence of non-recourse project indebtedness. The   
credit agreement for the financing of such indebtedness was executed in July    
1998.                                                                           

Mid-Atlantic Crossing                                                           

MAC is being developed as a 7,500 km two fiber pair self-healing ring that, 
upon completion, will connect New York, the Caribbean and Florida. MAC will be  
connected to AC-1 via its cable station in Brookhaven, New York and to SAC and  
PAC via its cable station anticipated to be constructed in St. Croix, United    
States Virgin Islands, providing connectivity between Europe, the eastern       
United States, the Caribbean and South America. This system is being designed   
to operate initially at 20 Gbps of service capacity, upgradable to a minimum of 
40 Gbps using DWDM technology.                                                  

In June 1998 and November 1998, Global Crossing executed contracts with     
Alcatel Submarine Networks and TSSL, respectively, for the construction of MAC, 
which provides for an initial service date of December 1999 at a total cost of  
approximately $295 million, excluding potential future upgrades and amounts     
capitalized with respect to warrants issued in exchange for the rights to       
construct MAC.                                                                  

Pan American Crossing                                                           

PAC is being developed as an 8,900 km two fiber pair cable that, upon       
completion, will connect California, Mexico, Panama, Venezuela and the          
Caribbean. PAC is being designed to interconnect with PC-1 through our landing  
station anticipated to be constructed in Grover Beach, California, with MAC     
through our landing station anticipated to be constructed in St. Croix, United  
States Virgin Islands and with SAC through our landing station anticipated to   
be constructed in Fort Amador, Panama. PAC will also connect with approximately 
3,000 km of terrestrial capacity in Mexico being developed through a joint      
venture arrangement. Global Crossing anticipates that PAC will cross Panama via 
an existing terrestrial right-of-way. PAC is being designed to operate          
initially at 20 Gbps of service capacity, upgradable to a minimum of 40 Gbps    
using DWDM technology.                                                          

In July 1998, Global Crossing executed a contract with TSSL for the         
construction of PAC which provides for an initial service date of February 2000 
at an estimated total cost of $580 million, including terrestrial capacity in   
Mexico but excluding potential future upgrades and amounts capitalized with     
respect to warrants issued in exchange for the rights to construct PAC.         

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South American Crossing                                                         

On March 11, 1999, Global Crossing announced plans for the development of   
SAC, a 16,000 km undersea and 2,000 km 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. Global         
Crossing expects that SAC will cost over $1 billion to construct and will       
commence service in 2000. Global Crossing plans 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. The undersea portion of  
SAC is currently planned to be wholly owned, while parts of the terrestrial     
portion are expected to be constructed through joint venture arrangements.      

The undersea portion of SAC will constitute a state-of-the-art four-fiber   
pair, self-healing ring, built using advanced DWDM technology. Undersea         
portions of the ring are expected to connect to landing sites at St. Croix      
(United States Virgin Islands), Fortaleza (Brazil), Rio de Janeiro (Brazil),    
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 (Brazil), Buenos Aires (Argentina), Santiago (Chile), Lima   
(Peru), Cali (Colombia) and Bogota (Colombia). 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. Initially, SAC is expected to have a capacity of 
40 Gbps and to be upgradable, using DWDM technology, to a minimum of 80 Gbps.   

Terrestrial capacity                                                            

In addition to the undersea segments of the Global Crossing network, Global 
Crossing has acquired or constructed, and expects to continue to acquire or     
construct, including through its merger with Frontier, terrestrial fiber        
capacity to complement its undersea cable systems and complete a global network 
to meet customer demands for worldwide city-to-city connectivity.               

Pan European Crossing. Global Crossing announced plans to build PEC which,  
upon completion, will consist of five self-healing rings offering connectivity  
between AC-1 and 25 European cities: London, Paris, Strasbourg, Amsterdam,      
Rotterdam, Antwerp, Brussels, Berlin, Frankfurt, Munich, Stuttgart, Hamburg,    
Hanover, Dusseldorf, Cologne, Copenhagen, Dublin, Dresden, Leipzig, Lyons,      
Marseille, Milan, Nuremberg, Turin and Zurich. Global Crossing also plans to    
connect additional European cities to this system. PEC is planned as an 11,000  
km system with 24 to 72 fiber pairs as well as spare conduits. Global Crossing  
has contracted with various parties for the acquisition of rights of way and    
the acquisition or construction of conduits. Furthermore, Lucent Technologies,  
Inc. will supply fiber and equipment as well as project management and          
integration services. Based on these arrangements, Global Crossing believes     
that the construction costs for the system will be approximately $950 million,  
excluding potential future upgrades. Global Crossing will develop PEC in        
several phases: Phase I, consisting of 13 cities, has an anticipated completion 
date during December 1999, with the remaining phases anticipated to be          
completed by the end of 2000.                                                   

 Global Access Ltd. Global Crossing owns a 49% interest in Global Access Ltd.,
a company which will own and operate GAL, a fiber optic terrestrial system      
being developed in Japan that, among other things, will connect the PC-1 cable  
stations with three cities in Japan. Through GAL, Global Crossing intends to    
offer terrestrial services to PC-1 customers. GAL is initially planned as a     
1,300 km system. Global Access Ltd. is currently negotiating with various       
parties for the construction of GAL and, based on those negotiations, Global    
Crossing believes that the construction costs for GAL will be approximately     
$190 million. The initial expected RFS date for the first phase of GAL's        
development is December 1999.                                                   

Global Crossing Landing Mexicana. Global Crossing owns 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.,                        

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that will provide approximately 3,000 km of terrestrial connectivity in Mexico, 
connecting to the PAC system. Dark fiber utilized to complete this terrestrial  
system will either be acquired or leased.                                       

Purchased Capacity. Global Crossing has acquired terrestrial connectivity   
between AC-1 landing stations in the United States and the United Kingdom to    
provide city-to-city service from New York City to London and has also entered  
into arrangements to ensure that its customers will receive terrestrial service 
in Germany and the Netherlands.                                                 

Additional network expansion opportunities                                      

Global Crossing is in the process of planning several new cable systems and 
evaluating other business development opportunities which will complement the   
Global Crossing network. There can be no assurance that Global Crossing will    
ultimately elect to proceed with such opportunities or, if Global Crossing does 
so, that such opportunities will help it achieve and sustain operating          
profitability.                                                                  

The demand for capacity on the routes served by the Global Crossing network 
and other cable systems are projected to have substantial growth, greatly       
exceeding current usage and available capacities. To address such demand,       
Global Crossing plans to evaluate and, as appropriate, build or acquire         
additional systems on such routes. It is anticipated that such systems, where   
possible, will be restored on the existing systems and will achieve further     
cost efficiencies through the use of existing landing stations.                 

Other activities                                                                

Neptune Acquisition. During November 1998, Global Crossing's indirect       
subsidiary, GC Pacific Landing Corp., entered into an agreement and plan of     
merger with Neptune Communications, L.L.C. and its wholly owned subsidiary,     
Neptune Communications Corp. ("NCC"), whereby, in April 1999, GC Pacific        
Landing merged with and into NCC in exchange for 2,239,642 shares of Global     
Crossing common stock (of which 223,965 shares remain to be issued pending      
transfer of licenses). Prior to its acquisition, Neptune was controlled by The  
Carlyle Group, an international investment firm, and was formed to pursue       
opportunities in the undersea cable business. Carlyle's managing director       
William Conway serves on the Global Crossing board of directors.                

Possible Investments. The Global Crossing board of directors has approved in
principle the making of minority investments in telecommunications companies    
and ISPs that do not compete with Global Crossing in its core business and that 
are current or prospective purchasers of capacity on the Global Crossing        
network. Such investments may consist of purchases of equity securities for     
either cash or exchanges of capacity on the Global Crossing network. Such       
investments may be managed either by Global Crossing directly or, if the Global 
Crossing board of directors deems advisable, by one or more third-party         
investment advisers so as to minimize potential conflicts of interest and the   
amount of time allocated by Global Crossing's senior management to such         
investments.                                                                    

Financing plan                                                                  

On July 2, 1999, Global Crossing entered into a $3 billion senior secured   
corporate credit facility with a group of several lenders and The Chase         
Manhattan Bank as administrative agent. The initial proceeds under the facility 
were used to refinance outstanding balances under the AC-1 and MAC project      
finance facilities, to refinance balances under a vendor financing arrangement  
with Lucent, to refinance debt used for the purchase of the Global Marine       
business from Cable & Wireless and for general corporate purposes. Global       
Crossing intends to finance the remainder of its announced systems, new         
projects and working capital needs mainly through the new corporate facility    
and other corporate financing.                                                  

As of June 30, 1999, the approximately $750 million initial cost of AC-1 had
been fully financed. The first contracted upgrade was funded through cash on    
hand, as will the second contracted upgrade. All remaining                      

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amounts outstanding under the AC-1 non-recourse project finance credit facility 
were refinanced in July 1999 through Global Crossing's new senior secured       
corporate credit facility.                                                      

Global Crossing estimates the total cost of developing and deploying AC-2,  
PC-1, MAC, PAC, SAC, PEC and GAL to be approximately $5,095 million, excluding  
costs of potential future upgrades and the amounts capitalized with respect to  
warrants issued in exchange for the rights to construct PC-1, MAC and PAC. This 
total is comprised of $750 million for AC-2, $1,200 million for PC-1, $295      
million for MAC, $580 million for PAC, $1,130 million for SAC, $950 million for 
PEC and $190 million for GAL. PC-1 will be financed by total equity investments 
of $400 million of which Global Crossing expects to provide approximately $231  
million, with the remaining $800 million of estimated costs to be financed      
through non-recourse project indebtedness at the PC-1 level. Global Crossing    
has financed its 49% interest in GAL through cash on hand to date, and intends  
to finance additional system costs through limited or non-recourse debt to be   
raised at the GAL level. The remaining system costs for MAC and PAC will be     
financed either through bank indebtedness under Global Crossing's new senior    
secured corporate credit facility or through other corporate financing.         

The construction costs for PEC (including costs of acquiring dark fiber) are
estimated to be $950 million, a portion of which was paid from the proceeds of  
the December 1998 issuance by Global Crossing Holdings of 10% Senior            
Exchangeable Preferred Stock (the "GCH Preferred Stock"). Global Crossing also  
raised additional capital required to finance this system through a combination 
of commercial bank borrowings, vendor financing and sales of dark fiber.        
Financing to complete the system is expected to be obtained from the corporate  
credit facility or other corporate financing.                                   

Global Crossing initially financed the approximately $868 million Global    
Marine acquisition, which was completed in July 1999, with approximately $600   
million in committed bank financing and the remainder with cash on hand. This   
initial indebtedness was refinanced through borrowings under Global Crossing's  
new senior secured corporate credit facility.                                   

System performance                                                              

AC-1, AC-2, PC-1, MAC, SAC, PEC and GAL are each designed to be installed   
with self-healing ring technology to optimize system availability and           
performance. Both span and ring switching protection are provided. Span         
switching protects a system against failures which affect individual fibers.    
Ring switching protects a system against complete failures between terminating  
landing sites. Because such technology will protect any single system failure   
in less than 300 milliseconds, no single system failure would have any material 
effect on customer service. Accordingly, the estimated system availability on   
any point-to-point link on such systems is 99.995%. The AC-1 system has         
experienced a number of faults, generally resulting from commercial fishing     
activity or shipping, causing the system to rely on its ring switching          
protection capability. Because of the self-healing ring architecture of the AC- 
1 system and the proper performance of its ring switching protection            
capability, which protects and reroutes traffic from single failures, such      
faults did not result in any loss of customer traffic. Although Global Crossing 
intends to further enhance system reliability through either construction or    
acquisition of backup restoration fibers, similar failures could occur in the   
future and, in the event of simultaneous failures on two or more segments, loss 
of customer traffic would occur.                                                

 As undersea and terrestrial cable systems achieve greater capacities, that is
as they carry more traffic along their transmission paths, it has become more   
important to provide a "self-restoration solution" because existing systems do  
not have enough capacity to provide restoration for these new high performance  
cable systems. Single span systems must enter into reciprocal arrangements      
either with other fiber-optic operators or with satellite carriers to pick up   
and deliver a portion or all of the traffic if a system failure should occur.   
Providing self-restoration through Global Crossing's ring design with the       
switching techniques described above offers a distinguishing advantage over     
single span systems with external restoration.                                  

With respect to PAC, which does not employ self-healing ring technology,    
Global Crossing is exploring options to enter into restoration arrangements     
with terrestrial fiber optic cable operators to protect against traffic         

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interruptions. Global Crossing intends to provide backup restoration for the    
PAC system through utilization of terrestrial capacity in the United States.    
Global Crossing may enter into similar arrangements to protect against          
catastrophic system malfunction on its other cable systems.                     

Sales and marketing                                                             

Global Crossing markets capacity on its systems to telecommunications       
providers, including PTTs, ISPs and established and emerging telecommunications 
companies. Its current customers represent a broad array of telecommunications  
companies.                                                                      

Global Crossing's initial sales strategy has emphasized the sale of capacity
on an Indefeasible Right of Use ("IRU") basis, whereby the customer purchases a 
unit of capacity for the remaining design life of a particular cable system. On 
AC-1, Global Crossing has sold capacity in an increment of 155 megabits per     
second (Mbps), known as an STM-1, for the 25-year design life of the system.    
For the other Global Crossing cable systems, Global Crossing expects to sell    
capacity to customers at the STM-1 level, as well as in smaller increments,     
based upon the demand levels along some routes. Global Crossing has instituted  
a tiered pricing schedule for all of its systems which provides for volume      
discounts, as well as allowing customers to reduce their average circuit cost   
as more circuits are purchased.                                                 

As Global Crossing continues to build and expand its global network, it     
expects to begin offering to its customers capacity services other than         
pursuant to IRU capacity sales discussed above. Capacity made available under   
these service contracts may be offered on either Global Crossing's undersea     
systems or as point to point capacity between cities connected on the Global    
Crossing network, once terrestrial capacity in the United States, Europe and    
Japan becomes available. Global Crossing believes that it will commence         
offering service contracts to its customers prior to the end of 1999.           

Global Crossing has made selective wholesale acquisitions of terrestrial    
capacity, enabling customers to achieve city-to-city connectivity through the   
Global Crossing network at prices significantly lower than if such customers    
had attempted to purchase such terrestrial capacity independently. For AC-1     
customers, Global Crossing enters into contractual arrangements providing       
terrestrial capacity between its landing stations in the United States and the  
United Kingdom, and New York City and London, respectively. In addition,        
Deutsche Telekom and Royal PTT Nederland ("KPN") provide terrestrial capacity   
directly to Global Crossing's AC-1 customers in Germany and the Netherlands,    
respectively. Furthermore, through SAC, PAC, GAL and PEC, Global Crossing plans 
to provide terrestrial connectivity directly on its own network to cities in    
South America, Mexico, Japan and Europe.                                        

To facilitate sales of capacity on the Global Crossing network as well as to
increase market awareness and name recognition, Global Crossing has established 
regional sales and marketing companies in the United States, the United Kingdom 
and Asia. Customers are able to purchase capacity anywhere on the Global        
Crossing network by signing a single capacity purchase agreement with any of    
the regional sales and marketing companies. Global Crossing has been able to    
recruit and train a full-service sales and marketing team of professionals who  
had previously worked at traditional telecommunications companies, emerging     
telecommunications companies and submarine cable design and construction        
companies. In total, Global Crossing employed 21 marketing professionals as of  
December 31, 1998, with offices in: Hamilton, Bermuda; Los Angeles and San      
Francisco, California; Morristown, New Jersey; Miami, Florida; London, England; 
Huizen, the Netherlands; Tokyo, Japan; and Buenos Aires, Argentina.             

During the pre-operational period for AC-1, in which Global Crossing        
generated significant pre-sales of capacity, Global Crossing held project       
information meetings, otherwise known as data gathering meetings, in order to   
better educate potential customers about AC-1 and its other planned cable       
systems. Attendees of such meetings were affiliated with both existing and      
prospective customers and represented a variety of sectors of the               
telecommunications industry. Global Crossing expects to continue to organize at 
least one major                                                                 

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international conference per year in order to provide customers with updated    
information on the Global Crossing network. Global Crossing will also continue  
to host regional project information meetings focusing on specific regions as   
Global Crossing expands coverage in new geographic areas.                       

Global Crossing plans to reinforce customer awareness through a variety of  
marketing campaigns, including international conferences and regional marketing 
events, participation in key industry and user group conferences, trade shows,  
speaking engagements, press conferences and promotional campaigns. In addition, 
Global Crossing's marketing team engages in regular visits to current and       
prospective customers to obtain a greater understanding of their individual     
needs and promote the advantages of the Global Crossing network.                

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

Summary of principal terms of standard contractual documentation                

Capacity Purchase Agreements (CPAs)                                           

In general, a CPA provides for the sale of capacity on an IRU basis, whereby
the purchaser acquires a unit of capacity for the remaining design life of a    
particular system, generally 25 years from the RFS date of the system. Upon     
execution of a CPA Global Crossing generally receives cash for 10% of the       
purchase price immediately, with the balance of the purchase price due upon     
activation of the capacity, which is required to occur by a specified date.     
Some CPAs provide for payment of the purchase price in installments over two to 
four years. Performance under CPAs is conditioned upon achieving the RFS date   
for a system and upon the obtaining of certain approvals, consents,             
governmental authorizations, licenses and permits.                              

In general, neither party is liable to the other under a CPA for            
consequential, incidental, indirect or special damages sustained by reason of   
(1) any failure in or breakdown on the system or the facilities associated with 
the system, (2) the failure of any inland carrier to perform the terms and      
conditions of any agreement to which it and the purchaser are parties or (3)    
any interruption of service, whatever the cause and however long it lasts. CPAs 
are generally subject to an arbitration clause.                                 

Inland Services Agreements (ISAs)                                             

 Global Crossing has entered into agreements with some terrestrial fiber cable
providers to purchase terrestrial capacity for resale to its AC-1 customers. In 
general, the term of each ISA is 25 years starting in 1998 or until the system  
is retired, whichever occurs first. In some cases, Global Crossing has the      
option to extend the term of each ISA for an additional five years. Neither     
party to an ISA is responsible for any loss, damage, delay or failure of        
performance resulting from an event of "force majeure."                         

Operations, administration and maintenance support                              

Global Crossing is developing its own worldwide operations, administration  
and maintenance ("OA&M") support center to serve each of its cable systems.     
Such support will be handled through three work centers: a Customer Care Center 
("CCC"), a Network Operations Center ("NOC") and a Technical Support Center     
("TSC"). The CCC is located in Bermuda and the NOC is located in the United     
Kingdom, which will also be the location of the TSC.                            

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Customer Care Center. The CCC provides capacity purchasers with a single    
point of contact for service provisioning, interconnect coordination support,   
billing and billing inquiries and adjustments.                                  

Network Operations Center. The NOC handles operations, administrative and   
maintenance activities for each of the Global Crossing cable systems, including 
new services provisioning, network performance, repair and restoration          
activities. Capacity provisioning which relates to activation of overall        
capacity on our systems, or allocation of capacity to large users, is also      
performed by the NOC. Management of network performance entails detection and   
response to system degradation and other performance parameters, as well as     
preventative activities.                                                        

 Technical Support Center. The TSC will be a 24-hour center managed by highly-
trained experts to handle technical inquiries from purchasers regarding project 
management, status of services provisioning, system performance and             
interconnection arrangements.                                                   

 Pursuant to the AC-1 Operations, Administration & Maintenance agreement, TSSL
will provide OA&M support on behalf of AC-1 for a term of eight years following 
the commencement of commercial operations. As of December 31, 1998, Global      
Crossing was committed under the AC-1 OA&M agreement to make payments totaling  
approximately $247 million. This agreement is extendable at Global Crossing's   
option for two additional periods of 8 1/2 years each.                          

As a result of Global Crossing's acquisition of Global Marine, Global       
Crossing expects to be able to provide installation and maintenance services to 
its own undersea cable systems. Global Marine operates a fleet of 13 cable      
ships and 21 submersible vehicles and has approximately 1,200 employees in the  
field. Acquisition of additional marine equipment will be required to enable    
Global Crossing to fully install and maintain its undersea cable systems.       

Competition                                                                     

Global Bandwidth Competition                                                  

In addition to direct competition on Global Crossing's specific undersea    
cable routes, Global Crossing more generally faces competition in its mission   
to provide bandwidth to customers worldwide. Competitors, including Qwest,      
Level 3 and MCI Worldcom, are increasingly expanding their service and product  
offerings to provide customers with global bandwidth. To the extent that these  
competitors satisfy global bandwidth demand on competing networks, demand for   
capacity on the Global Crossing network will be reduced as a result.            

Existing and Planned Cable Systems                                            

The routes addressed by Global Crossing's systems are currently served by   
several cable systems as well as satellites. Currently, there are several fiber 
optic transatlantic cable systems, each of which competes directly with AC-1    
and AC-2. Primary future sources of transatlantic competition for Global        
Crossing may result from, among others, (1) TAT-14, a transatlantic cable       
system which is being developed by its consortium members, including British    
Telecom, 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) Gemini, a transatlantic cable system being operated 
and marketed by MCI WorldCom, Inc. and Cable & Wireless, (4) a transatlantic    
cable system being developed by Level 3 and (5) Hibernia, a transatlantic cable 
system being developed by Worldwide Fiber Inc. Global Crossing believes that    
such other cable systems, if completed, will compete directly with Global       
Crossing's Atlantic capacity and the commitments of the developers and other    
carriers on these systems could substantially reduce estimated demand for       
capacity on its systems.                                                        

Similarly, there are several cable systems currently operating between the  
United States and Asia, the route to be served by PC-1. PC-1 may face           
competition in the transpacific market from, among others, (1) the              

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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. Although Global Crossing believes    
that such other cable systems will not satisfy the demand for capacity between  
the United States and Japan and that there is currently enough demand projected 
to accommodate all such systems, such other cable systems will receive          
commitments for capacity that PC-1 could have received in their absence.        
Moreover, while a number of the participants in these cable systems have        
purchased capacity on the other Global Crossing systems, it is likely that      
these participants will seek to satisfy their capacity requirements for traffic 
between the United States and Asia with the systems they are sponsoring and not 
with PC-1.                                                                      

 In addition, Global Crossing will face competition on PEC, its 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, Hermes and a joint venture between Level 3 and COLT Telecom Group plc, 
which are currently planning or building trans-European network assets.         

Global Crossing also faces competition for its 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 consortia 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.    

Other regional and global systems are being considered by developers,       
including Project Oxygen, a global system being evaluated by the CTR Group,     
Ltd. In addition, Global Crossing may face competition from existing and        
planned regional systems and satellites on its MAC and PAC routes, where        
entrants are vying for purchases from a small but rapidly growing customer      
base.                                                                           

Satellite Transmission                                                        

When comparing cable transmission against satellite transmission, Global    
Crossing believes that cable has a distinct advantage with respect to latency   
(i.e., transmission delay) bandwidth and voice quality. Cable transmission has  
a lower cost per circuit, attributable in part to higher capacity and longer    
expected equipment life than satellite transmission. Satellite transmission is  
generally considered to have a comparative advantage versus cable transmission  
only in the area of point-to-multipoint broadcast and "thin route"              
transmission, as opposed to the more common point-to-point, high volume         
transmission for which cable usage is considered to be preferable. As newer     
generation broadband satellite transmission services enter the market, these    
services will likely complement fiber optic transmission rather than compete    
against it, due to the comparative economic advantage of optical fiber in       
delivering broadband services to densely populated metropolitan areas and,      
conversely, the comparative economic advantage of satellite transmission in     
sparsely populated rural areas.                                                 

In early 1997, the FCC granted Ka-band licenses and orbital locations to 13 
companies. The firms developing future satellite technology envision a network  
of satellites that will provide broadband data transmission with data rates of  
2 Mbps, 20 Mbps and even 155 Mbps. Potential participants in the field include  
Astrolink, Skybridge, Teledesic, CyberStar and SpaceWay, which are seeking to   
provide high bandwidth transmission networks. Due to (1) the significant        
initial costs related to these systems, (2) the risks relating to satellite     
launch systems and (3) the significantly lower transmission capacity versus     
current fiber optic systems, Global Crossing believes that the new satellite    
systems will not be able to offer competitive cost per unit of transmission     
capacity in the dense metropolitan markets Global Crossing is targeting.        
Further, Global Crossing believes it will have at least four years lead time to 
help it solidify a sustainable competitive market position before true          
broadband satellite service commences.                                          

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Suppliers                                                                       

In addition to Global Marine, there are currently three major supply        
companies in the undersea cable industry: TSSL, Alcatel and Kokusai Denshin     
Denwa-Submarine Cable Systems ("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. TSSL completed          
construction of AC-1, is responsible for the design and installation of PAC     
and, together with KDD-SCS (as a subcontractor), is responsible for design and  
installation of PC-1. Alcatel and TSSL are responsible for the design and       
construction of MAC. There are multiple suppliers available for terrestrial     
systems. As a result of Global Crossing's acquisition of Global Marine, Global  
Crossing will be a major supplier of installation and maintenance services for  
its undersea cable systems.                                                     

Regulation                                                                      

In the ordinary course of development, construction and operation of our    
fiber optic cable systems, Global Crossing will be required to obtain and       
maintain various permits, licenses and other authorizations both in the United  
States and in international jurisdictions where its cables land or in the       
territories in which terrestrial fiber optic systems are being constructed, and 
Global Crossing will be subject to applicable telecommunications regulations in 
such jurisdictions. In particular, submarine cable landing or similar licenses  
as well as other infrastructure construction authorizations will be required in 
many of the jurisdictions where Global Crossing's planned undersea cable        
systems will land or terrestrial segments will be constructed. Global Crossing  
is both filing applications for cable landing licenses with the FCC and, where  
necessary, regulatory agencies in other countries, and, where available, is     
seeking private carriage status for these systems. These licenses are typically 
issued for a term of years, in the case of the FCC-issued cable landing         
licenses, 25 years, and are subject to renewal. The law of several              
international jurisdictions limits foreign ownership, direct or indirect, of    
entities holding cable landing licenses, or building terrestrial                
infrastructures. In connection with the implementation of the World Trade       
Organization ("WTO") Basic Telecommunications Agreement, the FCC adopted        
regulations establishing an open entry standard for applicants from WTO member  
countries, including a rebuttable presumption that applications from carriers   
from WTO member countries do not pose concerns that would justify denial of an  
application on competitive grounds. In addition, Global Crossing and, in some   
cases, its joint venture partners, are obtaining licenses from a number of      
jurisdictions to construct, operate, and sell capacity on terrestrial fiber     
optic cable systems.                                                            

Construction of each of Global Crossing's cable systems also requires the   
acquisition and maintenance of various environmental and other construction     
related permits and licenses in the ordinary course of business. Global         
Crossing's undersea construction contracts are generally "turnkey"              
arrangements, whereby the contractor is obligated to obtain and maintain all    
such licenses and permits. Although Global Crossing expects that the            
construction contracts for each of its other planned undersea cable systems     
will impose the burden of acquiring and maintaining construction licenses and   
permits on the contractor for each of such systems, there can be no assurance   
that such contractor will successfully obtain such permits and licenses.        

Employees                                                                       

 As of June 30, 1999, Global Crossing had approximately 350 employees, with an
additional 1,200 employees added following its July 1999 acquisition of Global  
Marine. Global Crossing considers its relations with its employees to be good.  

Financial information by business segment and geographic area                   

 See Note 6 of Global Crossing's condensed consolidated financial statements
on page F-7 and Note 3 of Global Crossing's consolidated financial statements   
on page F-22 for information regarding Global Crossing's revenues and assets by 
business segment and geographic region.                                         

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Frontier Corporation

Frontier provides integrated telecommunications services including Internet,
Internet Protocol ("IP") and data applications, long distance, local telephone  
and enhanced services to business, carrier, web-centric and targeted            
residential customers nationwide and in some international countries. Although  
a predecessor company dates to 1899, Frontier was incorporated in 1920 under    
the laws of New York State to take over and unify the properties of a           
predecessor company and some properties of the New York Telephone Company which 
were located in the same general territory. Frontier is headquartered in        
Rochester, New York.                                                            

Through its integrated services business, Frontier is one of the nation's   
largest long distance companies. Frontier provides domestic and international   
voice, data products, video and audio conferencing, digital distribution        
services, Internet service and other communications products. Frontier's        
customers for these services are primarily small to mid-size business           
customers, carrier customers, web-centric customers and targeted consumer       
markets.                                                                        

Frontier's local communications services business consists of 34 local      
telephone companies that, as of December 31, 1998, serve over one million       
access lines in thirteen states. Frontier is one of the largest local exchange  
service providers in the United States.                                         

 Frontier also owns a 50% interest in the Upstate Cellular Network, a wireless
joint venture with Bell Atlantic Mobile in upstate New York and Pennsylvania    
that is managed by Frontier and is accounted for using the equity method of     
accounting. On July 20, 1999, Bell Atlantic Mobile entered into an agreement    
with Frontier pursuant to which Bell Atlantic Mobile will acquire Frontier's    
interest in Upstate Cellular Network, together with its 55% interest in New     
York RSA No. 3 Cellular Partnership and its 15% interest in Orange County-      
Poughkeepsie MSA Limited Partnership. This transaction is expected to be        
completed before the end of 1999.                                               

Strategy                                                                        

Frontier's strategy is to be the premier provider of integrated             
telecommunications solutions in its target markets. Frontier markets itself to  
customers as a single source provider of integrated communications services,    
such as long distance, local, cellular, paging, data, Internet and enhanced     
services. Frontier anticipates that public policy will continue to evolve in    
favor of greater competition and, as a result, Frontier has been positioning    
itself to compete aggressively in a marketplace with numerous new competitors.  

Construction of the initial 13,000-mile segment of the Frontier Optronics   
Network SM, as originally announced in 1996, is expected to be completed on or  
around August 15, 1999. Frontier made a commitment to extend this network in    
1998, and that extension is expected to be completed in late 1999. Through swap 
agreements with Enron Communications and WTCI, Frontier will add approximately  
4,000 additional route miles in the western half of the United States. These    
agreements will also permit Frontier to establish additional redundant SONET    
rings, further enhancing the reliability and performance of the network. In     
addition, in July 1998, Frontier entered into an agreement with Williams        
Communications, Inc. to construct an extension of the network into the          
southeastern United States. In aggregate, the Frontier Optronics Network SM     
will have approximately 20,000 route miles. As of December 31, 1998,            
approximately 74% of the fiber miles on the original 13,000 route mile network  
were in service.                                                                

Continuing network integration efforts involving Frontier subsidiaries are  
expected to further reduce future network costs as well as provide new revenue  
opportunities for Frontier. The combined technology of the Frontier Optronics   
NetworkSM and the Nortel DMS-500 switches installed at strategic locations      
along the network will enable Frontier to expand its ability to provide         
integrated local and long distance services nationwide. In 1998, Frontier added 
ATM and IP capabilities to the network which will provide greater speed and     
service for data products. In the fourth quarter of 1997, Frontier also         
introduced a nationwide frame relay product. This product complements           
Frontier's voice services business with a portfolio of additional data services 
products. This technology makes Frontier a nationwide facilities-based provider 
of integrated local, long distance and data services.                           

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Integrated services                                                             

General                                                                       

Frontier is one of the nation's largest long distance companies. Frontier's 
integrated services segment provides domestic and international voice, data     
products, video and audio conferencing, digital distribution services, Internet 
service and other communications products to primarily small to mid-size        
business customers, carrier customers and targeted consumer markets. CLEC       
services are currently available in two-thirds of the United States, plus       
Washington D.C., providing Frontier with the ability to offer integrated data,  
local and long distance services to approximately 72% of the United States      
population. In February 1998, Frontier acquired GlobalCenter, Inc., a leading   
provider in digital distribution, Internet and data services headquartered in   
Sunnyvale, California. The acquisition of GlobalCenter and subsequent           
development and integrative work has assisted Frontier in responding to changes 
in the nature of calling, expanded use of the Internet and growth of data       
transmission.                                                                   

 Frontier operates its own switches, develops and implements its own products,
monitors and deploys its transmission facilities and prepares and designs its   
own billing and reporting systems. Frontier focuses primarily on commercial     
accounts and some targeted consumer markets. In this segment, calling volume    
consists primarily of calls made during normal business hours, which command    
peak-hour pricing. Frontier's residential subscribers tend to make most of      
their calls in the evening and on weekends, when business usage is lowest.      

Products and services                                                         

Frontier provides a variety of integrated telecommunications products and   
services to commercial and residential subscribers nationwide designed to meet  
the customer's total communications needs. The bulk of Frontier's revenue is    
derived from outbound and inbound long distance services which are generally    
marketed under the Frontier name. Many of Frontier's integrated products,       
however, differ from those of competitors due to the level of value-added       
services Frontier offers and the flexibility of product pricing to maintain     
competitiveness.                                                                

The variety of products and services developed and offered are based upon   
market driven requirements of the customer including an expectation that        
services can be integrated. They include: digital distribution and data         
services, CLEC services, and voice and other value-added services.              

Digital Distribution and Data Services. Frontier's data services products   
target small to mid-sized businesses and web-centric businesses. Data services  
currently include digital private lines, frame relay, dial-up Internet,         
dedicated Internet and web-hosting. The acquisition of GlobalCenter has         
accelerated Frontier's ability to provide an expanded line of data services.    

During 1998, after the acquisition of GlobalCenter, Inc., Frontier expanded 
its data services product set that can be segmented into three product lines:   
Transport, IP and Application Services. Transport is the means to transfer data 
from one location to another. Product offerings within this service category    
include dedicated private lines, frame relay, and managed services. Within the  
IP product line, Frontier provides the customer with the cost efficiencies of a 
public Internet network and the security of a private network. Applications     
Services are outsourced applications hosted by the service provider and         
integrated into both public and private networks which enable the customer to   
access the application at all times. Product offerings within this category     
include digital distribution, integrated messaging, and web site hosting.       

 Digital distribution involves a combination of transport services, consulting
services and professional expertise aimed at providing customers with           
customized Web-based data services.                                             

CLEC services. Frontier provides competitive local telephone service bundled
with Frontier's other integrated services through its CLEC product offering.    
The CLEC offering is provided either using Frontier's local switching equipment 
in locations where it is available or on a resale basis. As of December 31,     
1998,                                                                           

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Frontier was providing local services as a CLEC, together with a complete range 
of long distance products, in 32 states plus Washington, D.C. Most of that      
coverage was provided via resale of services of incumbent local exchange        
carriers. Within that footprint, CLEC service was also provided initially from  
Frontier's own switches in New York, Boston and Minneapolis.                    

 Since then, Frontier expanded its coverage to approximately two-thirds of the
United States and turned up facilities-based service in a total of thirteen     
metropolitan areas by the end of 1998. Facilities-based service is being        
offered in cities that are on the Frontier Optronics Network SM, which will     
provide Frontier with the opportunity to expand its offerings of combined local 
and long distance services into additional markets, control access costs, and   
leverage the network. The number of CLEC lines currently provided by Frontier   
makes it one of the largest CLEC's in the United States.                        

Value-added services. Frontier's value-added services are aimed primarily at
the business subscriber, although Frontier also offers products for residential 
customers. Value-added services provide cost-effective solutions for both       
simple and complex communications applications and include calling cards,       
teleconferencing, broadcast fax, voice mail and cellular and paging services.   

The calling card is a personal communication tool that can provide access to
teleconferencing, voice mail, information services such as stock quotes and     
weather information, Flexible call routing of toll-free service, call delivery  
for immediate or future message delivery, directory assistance and travel       
connections to hotel, car and airline reservation systems. Using a calling      
card, customers can call to any domestic and most international locations from  
the U.S. or numerous international locations. In addition, the calling card     
product enables customers to dial 100 frequently called numbers using their own 
toll free number and a four-digit preprogrammed PIN.                            

Frontier conferencing provides a way for three or more people at different  
locations to participate in a joint discussion. Several options are available:  
800 meet-me, dial-out or dial-in via a Frontier calling card. Frontier's        
broadcast fax product enables the user to fax a single document to multiple     
locations at the same time and is designed for the larger fax user who          
regularly sends information to an established list.                             

Frontier's Voice Mail Plus with fax mail provides an efficient means of     
always being accessible, through the use of outcall or pager notification, and  
never missing important calls. With an individual toll-free number, a customer  
can save, delete or forward fax and voice messages to other Voice Mail Plus     
users or change greetings all on one call. Customers can also store a fax or    
automatically print it at a designated fax machine.                             

 Frontier offers nationwide numeric paging through personal toll-free numbers.
When coupled with the flexible call routing feature, nationwide paging creates  
a robust travel application. Local paging service is also available in selected 
local franchise markets.                                                        

Frontier's toll-free services are offered primarily to business customers on
a single invoice, although several residential products are available. In       
addition to basic 800/888 toll-free applications, Frontier offers MultiPoint,   
which allows customers to terminate calls in different locations based on the   
four-digit personal identification number the caller enters; GlobalPoint        
international service, which completes calls originating in over 40 countries;  
and Flex Connect 800, a fractional service which allows multiple residential    
customers to reach different terminating locations utilizing a four-digit       
security personal identification number. Frontier also provides a robust line   
of routing features such as flexible call routing, which allows customers to    
change where calls terminate based on their need; routing and blocking          
enhancements determined by the area code, area code and exchange or full ten-   
digit telephone number of the caller; time of day and day of week routing; and  
percent call allocation.                                                        

Toll-free services also include interactive voice response services,        
including TargetLine, a call prompter that routes callers either by menu        
options or prompting them to enter digits for extension routing; InstaLink, a   
dealer locator routing callers based upon their area code and exchange or zip   
code; and PassPort, a network based host interface interactive voice response   
solution.                                                                       

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Pricing. Customers subscribe to various products. The nature of the products
determines the price per minute that they pay on their outbound or inbound long 
distance calls. Rates typically vary by the volume of usage, the distance of    
the calls, the time of day that calls are made, the region that originates the  
call and whether or not the product is being provided on a promotional basis.   

Reporting services. Frontier offers a variety of billing options and media  
aimed primarily at business customers. When a new commercial account is opened, 
the customer is offered the opportunity to custom design the format of its      
reports. Frontier also offers customers graphic reports of traffic patterns on  
a nationwide basis by state, within state by area of dominant influence and     
within area of dominant influence by zip code. Frontier believes these services 
are useful to some customers for direct response advertising and customer       
service applications. Frontier also offers its proprietary personal computer    
reporting service, known as uCommand, which allows customers to design their    
own reports, prepare separate itemized bills, do mark-up reporting and generate 
numerous other customer reports.                                                

800 services. These services include area code blocking and routing; time of
day routing; Home Connection 800, a fractional 800 service which allows         
residential customers to access 800 service utilizing a four-digit security     
PIN; Multi-Point 800 service, which allows customers to use accounting codes on 
an 800 number or route a single 800 number to numerous locations                
simultaneously; Follow-Me 800, which allows customers to change call routing    
and TargetLine 800, which routes calls to the closest location a customer       
identifies and provides custom prompts based upon a customer specific database. 

Transmission                                                                    

Frontier endeavors to have sufficient switching capacity, local access      
circuits, and integrated services circuits at and between its network switching 
centers to permit subscribers to obtain access to the switching centers and its 
integrated services circuits on a basis which exceeds industry standards        
regarding clarity, busy signals or delays.                                      

 The network currently utilizes a variety of transmission circuits to complete
long distance calls. The Frontier Optronics Network SM will reduce the number   
of transmission facilities leased and provide for a more dependable and cost-   
effective transmission system. Currently, Frontier Optronics Network SM         
facilities have been completed in Texas, California, Nevada, Utah, Colorado,    
Kansas, Missouri, Ohio, Pennsylvania, New York, Illinois, Wisconsin, New        
Mexico, Arizona, Oregon, Washington, Nebraska, Iowa, Indiana, Michigan, New     
Jersey, Maryland, Kentucky, Tennessee, Oklahoma and Massachusetts. Completion   
of the expanded Frontier Optronics Network SM is expected in late 1999.         

In addition to the Optronics transmission circuits, the network is comprised
of digital microwave systems located in California, New York and Pennsylvania   
for which Frontier holds FCC licenses, and facilities that have been leased on  
a fixed price basis under primarily short-term contracts. While Frontier still  
has a number of longer term lease contracts, a substantial number of these      
contracts have annual "mark-to-market," "circuit portability," and "commitment  
buy-out" clauses and Frontier renegotiates contracts when it is appropriate to  
do so. These provisions function to keep the price Frontier pays at or near     
current market rates. An important aspect of Frontier's operation is planning   
the mix of the types of circuits and transmission capacity to be used for each  
network switching center so that calls are completed on a basis which is cost   
effective for Frontier without compromising prompt service and high quality to  
subscribers.                                                                    

Frontier's network switching centers house equipment with varying capacities
to meet the anticipated needs of the service origination region or regions      
served by the center. The equipment used by Frontier is, for the most part,     
designed to permit expansion of its capacity by the addition of standard        
components. If the maximum capacity of the equipment in any center is reached,  
Frontier upgrades it with higher capacity switching equipment in an effort to   
scale the equipment for growth. Frontier is dependent upon local telephone      
companies for installing local access circuits and providing related service    
when establishing a network switching center. International service is provided 
through both Company owned direct circuits and through contracts with several   
international long distance companies to provide high quality international     
service at competitive rates.                                                   

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It is anticipated that the Frontier Optronics Network SM will continue to   
lower Frontier's current cost structure and expand Frontier's transmission      
capabilities. However, Frontier cannot definitively project the change in its   
cost structure nor assure that the network will be fully completed as           
scheduled.                                                                      

Local communications services                                                   

 Frontier's local communications 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. The local exchange carriers provide local, toll,   
access and resale services, sell, install and maintain customer premises        
equipment and provide directory services.                                       

Over the last decade, Frontier has invested heavily to install advanced     
digital switching platforms throughout all of its switching network, making     
Frontier one of the first in the industry to be served by an entirely digital   
network for its local exchange companies. Frontier has achieved substantial     
cost reductions through the elimination of duplicative services and procedures  
and the consolidation of administrative functions. Frontier believes that       
additional cost reductions may be obtainable from advanced switching platforms  
and outside plant delivery systems. Frontier intends to pursue additional gains 
in productivity by investing in these technologies where feasible, and through  
reengineering customer service processes.                                       

Of the approximately 1,024,726 access lines in service on December 31, 1998,
721,039 were residential lines and 303,687 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.                                                         

Frontier is pursuing several alternatives to provide expanded broadband     
capabilities to its customers. To date, Frontier has installed over 31,000      
fiber miles of fiber based network facilities, totaling more than 930 sheath    
miles, in the Rochester, New York area to provide its customers with enhanced   
capacity and to position Frontier to offer new products. Frontier provides      
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 connection with its integration strategy, Frontier has developed a program
known as "Frontier Long Distance," whereby Frontier's local exchange companies  
resell Frontier's integrated services. Frontier believes 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 Frontier's local telephone    
exchange companies.                                                             

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Global Crossing's Management Discussion 
and Analysis of Financial Condition and 
Results of Operations 

Overview                                                                        

Global Crossing is an independent provider of global Internet and long      
distance telecommunication facilities and related services utilizing a network  
of undersea and terrestrial digital fiber optic cable systems. Global Crossing  
started development in March 1997, when it entered into a contract with TSSL    
for the design, development, construction and installation of AC-1 and obtained 
commitments for its initial financing. AC-1, Global Crossing's first fiber      
optic cable system, is a four fiber pair self-healing ring connecting (1) the   
United States to the United Kingdom, (2) the United Kingdom to the Netherlands  
and Germany, (3) the Netherlands to Germany and (4) Germany to the United       
States. The first segment of AC-1, the United States to United Kingdom route,   
was completed and commenced operations in May 1998, and the entire AC-1 system  
commenced operations in February 1999.                                          

Until May 1998, when the United States to United Kingdom segment of AC-1    
reached RFS, Global Crossing was a development stage company and since          
inception has been involved in the planning, financing, marketing,              
organization, development, design and construction of the AC-1 system and seven 
other planned systems, which are AC-2, PC-1, MAC, PAC, SAC, PEC and GAL. See    
"The Companies--Global Crossing Ltd." beginning on page 98. During 1998, Global 
Crossing achieved a number of significant milestones, including (1) the         
recruitment of experienced professionals in undersea cable and                  
telecommunications operations, (2) the signing of construction contracts on AC- 
1, PC-1, MAC and PAC, (3) the execution of the AC-1, PC-1 and MAC credit        
facilities and the execution of a financing commitment with respect to PAC, (4) 
completion of the AC-1 ring, (5) the issuance by Global Crossing Holdings of    
$800 million in principal amount of senior notes ("GCH Senior Notes"), (6) the  
initial public offering of Global Crossing common stock, (7) the issuance by    
Global Crossing Holdings of $500 million in principal amount of preferred stock 
("GCH Preferred Stock") and (8) the execution of $1,052 million of CPAs for     
undersea and terrestrial capacity and dark fiber sales.                         

Revenues and deferred revenues                                                  

Sales revenue and deferred revenue                                            

Customers may enter into CPAs to purchase an IRU in units of capacity on any
of Global Crossing's fiber optic cable systems. The purchase price for such     
capacity is non-refundable once the applicable segment purchased is RFS. The    
IRU purchased entitles the customer to all rights and obligations of ownership  
of the capacity for a period of 25 years after the system RFS date. Where       
available on a specific system, Global Crossing's CPAs generally provide that   
the system will have self-healing ring capability, which means that, in the     
event of interruption, capacity on any segment of a system will be              
instantaneously restored either on another system segment or within the same    
segment so that the same point-to-point connectivity is maintained.             

Revenues from the sale of capacity are recognized in the period that the    
rights and obligations of ownership transfer to the purchaser, which occurs     
when (1) the purchaser obtains the right to use the capacity, which can only be 
suspended if the purchaser fails to pay the full purchase price or fulfill its  
contractual obligations, (2) the purchaser is obligated to pay OA&M costs and   
(3) the segment of the system related to the capacity purchased is available    
for service. Customers who have entered into CPAs for capacity have paid        
deposits toward the purchase price, and such amounts have been included as      
deferred revenue in the consolidated financial statements. In some CPAs,        
customers who have purchased capacity on systems prior to the date the system   
has self-healing ring capacity have contractually required full self-healing    
ring capability as a legal condition which, if not satisfied, would enable them 
to terminate the CPA and requires Global Crossing to refund capacity payments.  

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Operating lease revenue and deferred revenue                                  

In addition to sales type leases, Global Crossing may enter into operating  
lease agreements to lease capacity on its systems. These agreements may grant   
the customer a right to use capacity for periods of time which may be           
substantially less than the design life of the capacity, generally 25 years.    
Global Crossing will amortize revenues from these operating lease agreements    
over the lives of the agreements, with cash received but not yet recognized as  
operating revenues, recorded in the consolidated financial statements as        
deferred revenue.                                                               

OA&M revenue                                                                  

 Pursuant to the terms of its existing CPAs, Global Crossing is obliged to use
commercially reasonable efforts to cause the AC-1 system to be maintained in    
efficient working order and in accordance with industry standards. In exchange  
for the operating, administration and maintenance services provided by Atlantic 
Crossing Ltd. ("ACL"), customers are obligated for the term of their IRU to pay 
for their allocable share of the costs for operating and maintaining the        
system. Customers appoint members to a system advisory committee, which is      
charged with the responsibility of directing the operations and maintenance of  
AC-1. Customers pay 110% of ACL's cost to operate and maintain the system based 
on their pro rata share of total capacity subject to annual maximum amounts per 
circuit purchased of $250,000 per transatlantic circuit and $50,000 per         
European circuit. Each customer's pro rata share is effectively calculated by   
taking the weighted average of their purchased capacity over total capacity     
sold multiplied by 110% of actual costs incurred to customers quarterly in      
advance based on the prior year's actual costs. These amounts are non-          
refundable, and should a customer fail to make an OA&M payment, ACL may suspend 
all rights to capacity granted under the IRU. Undersea OA&M revenues are        
recognized in the period that the related services are provided. On an annual   
basis, the actual OA&M costs Global Crossing incurs are accumulated and an      
adjustment is made to true up actual OA&M revenues so that they equal 110% of   
actual costs incurred, provided specified contractual limits have not been      
reached.                                                                        

Construction in progress; capacity available for sale; cost of capacity sold  

Construction costs incurred with respect to each segment of a cable system  
are reflected as "Construction in Progress" in Global Crossing's consolidated   
balance sheets until a segment becomes operational, at which time such costs    
are reflected as Capacity Available for Sale. Capacity Available for Sale is    
recorded at the lower of cost or fair value less cost to sell and is charged to 
Cost of Capacity Sold in the period the related revenues are recognized. Fair   
value of capacity is derived from a third party consultant's market study of    
expected sales of capacity.                                                     

Global Crossing records the cost of acquiring terrestrial capacity in       
Capacity Available for Sale in amounts equal to the present value of future     
payment obligations associated with the acquisition of such terrestrial         
capacity, excluding from such payments amounts attributable to operations and   
maintenance costs.                                                              

Construction in Progress includes direct expenditures for construction of   
systems, including advisory, consulting and legal fees, interest during         
construction and amortized debt issuance costs incurred during the construction 
phase.                                                                          

Cost of sales                                                                   

Cost of undersea sales in any period is calculated based on the ratio of    
capacity revenues recognized in the period to total expected capacity revenues  
over the life of the systems multiplied by the total costs incurred to          
construct the system. This calculation of the cost of sales amount matches      
costs with the value of each sale relative to total expected revenues. Until    
the entire system is completed, for purposes of calculating cost of sales, the  
total system costs incurred will include an estimate of remaining costs to be   
incurred to complete the entire system. The calculation of cost of undersea     
sales is based on total system cost including both the initial                  

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system cost and the cost of system upgrades that management has the intent and  
ability to complete, provided the need for such upgrades is supported by an     
independent consultant's revenue forecast. Changes in management's estimate of  
the total expected revenues to be derived from sales of capacity will result in 
adjustments to the calculation of cost of sales. These adjustments will be      
recorded on a prospective basis over future periods commencing with the period  
during which management revises its estimate. The cost of terrestrial capacity  
directly related to undersea sales is charged to cost of sales in the period    
that the related revenue is recognized.                                         

Operating type lease cost of sales                                            

Costs relating to operating type lease revenue will be classified as a      
depreciable asset and depreciated over the estimated useful life of the         
capacity.                                                                       

Operating expenses                                                              

In addition to cost of capacity sold, Global Crossing's operating expenses  
principally comprise of sales and marketing, operations and maintenance,        
general and administrative and network development costs. Costs relating to the 
evaluation of possible additional systems are expensed as incurred.             

Results of operations for the three months ended June 30, 1999 and June 30,     
1998                                                                            

Revenues. Global Crossing's revenues on sales of capacity relating to AC-1  
increased $82 million (81 percent) to $183 million during the three months      
ended June 30, 1999 from $101 million during the three months ended June 30,    
1998. During the three months ended June 30, 1999 and 1998, operation and       
maintenance services revenue was $7 million and none, respectively.             

Cost of capacity sold. For the three months ended June 30, 1999 and 1998,   
Global Crossing recognized $81 million and $41 million, respectively, in cost   
of capacity sold, resulting in a gross margin on capacity sales of 56% and 59%, 
respectively. Non-cash cost of undersea capacity sold was $61 million and $32   
million during the three months ended June 30, 1999 and 1998, respectively.     
Cost of capacity sold also includes the cost of terrestrial capacity sold, a    
cash expense, during the three months ended June 30, 1999 and 1998, of $20      
million and $9 million, respectively. During the three months ended June 30,    
1999, Global Crossing calculated costs of undersea capacity sold for AC-1 based 
on the ratio of the period's actual revenue to total expected future revenues   
given a minimum projected sales capacity of 1024 circuits times the             
construction cost of the system. This calculation of cost of sales matches      
costs with the relative value of each sale. During the three months ended June  
30, 1998, Global Crossing calculated costs of undersea capacity sold for AC-1   
based upon a minimum projected sales capacity of 512 circuits.                  

Service Contracts. Since the AC-1 system became operational, Global Crossing
has offered its capacity pursuant to sales agreements that qualify for sales    
type lease accounting. Under this method, revenues and cost of capacity sold    
are recognized in the period the rights and obligations of ownership transfer   
to the purchaser and the cost of the AC-1 system has been recorded as Capacity  
Available for Sale. See notes to Global Crossing's consolidated financial       
statements beginning on page F-6.                                               

As Global Crossing continues to build and expand its global subsea and      
terrestrial network, it expects that it will begin to offer to its customers    
capacity services that will not qualify as sales-type leases as discussed       
above. Capacity made available under such contracts (Service Contracts) may be  
offered on AC-1 (or other subsea systems as they become operational) or as      
point to point capacity connecting cities in Global Crossing's global network,  
once terrestrial capacity in the U.S. (i.e., upon completion of the Frontier    
merger), Europe and Japan become available.                                     

Upon the commencement of offering Service Contracts, which Global Crossing  
believes will occur prior to the end of 1999, the carrying value of the AC-1    
system (and the other sub-sea systems as they become                            

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operational) will be depreciated over their remaining economic useful lives and 
revenues related to these Service Contracts will be recognized as the services  
are rendered over the terms of the contracts. For capacity sales contracts that 
meet the requirements of sales-type-lease accounting, revenues will be          
recognized as described above and cost of capacity sold will be based upon the  
net book value of the remaining committed to capacity. If Global Crossing had   
offered Service Contracts beginning on January 1, 1999, it would have incurred  
additional depreciation expense, offset by reduced cost of capacity sold on     
sales type leases recorded. During the six months ended June 30, 1999, the      
impact on results of operations would not have been significant.                

Operations, administration and maintenance (OA&M). Global Crossing incurred 
OA&M costs on AC-1 of $14 million and $2 million during the three months ended  
June 30, 1999 and 1998, respectively. Global Crossing has entered into an       
agreement with Tyco Submarine Systems Limited (TSSL) relating to operations,    
administration and maintenance of AC-1 which limits Global Crossing's total     
OA&M expense for the system. Global Crossing anticipates that its OA&M costs    
associated with AC-1 will be largely recovered through charges to its customers 
under the terms of Capacity Purchase Agreements (CPAs). OA&M costs associated   
with systems under construction are expensed as incurred.                       

General and administrative. General and administrative expenses totaled $22 
million and $7 million during the three months ended June 30, 1999 and 1998,    
respectively, and was comprised principally of salaries, employee benefits and  
recruiting fees reflecting Global Crossing's staffing for multiple systems,     
travel, professional fees, insurance costs and occupancy costs.                 

Network development. Global Crossing incurred network development costs     
during the three months ended June 30, 1999 and 1998 of $5 million and $4       
million, respectively. These amounts are comprised principally of salaries and  
professional fees.                                                              

Sales and marketing. During the three months ended June 30, 1999, Global    
Crossing incurred sales and marketing expenses of $13 million, including        
commissions to TSSL of $7 million incurred on revenues recognized during this   
period. During the three months ended June 30, 1998, Global Crossing incurred   
sales and marketing costs of $7 million, including commissions to TSSL of $3    
million incurred on revenues recognized during this period. The increase from   
1998 was due to additions in headcount, occupancy costs, plus marketing costs,  
commissions paid and other promotional expenses to support Global Crossing's    
rapid growth.                                                                   

Stock related expense. Global Crossing recognized $9 million and $23 million
of stock compensation expense during the three months ended June 30, 1999 and   
1998, respectively, relating to options issued under its Stock Incentive Plan,  
plus certain stock related expense related to stock options awarded to          
consultants, accounted for under SFAS No. 123.                                  

Depreciation and amortization. For the three months ended June 30, 1999 and 
1998, Global Crossing incurred depreciation and amortization of $4 million and  
$0.4 million, respectively.                                                     

 Provision for doubtful accounts. For the three months ended June 30, 1999 and
1998, Global Crossing recorded a provision for doubtful accounts of $2 million  
and $1 million, respectively.                                                   

Termination of advisory services agreement. In connection with the          
development and construction of AC-1, Global Crossing entered into an advisory  
services agreement with PCG Telecom Services LLC, an affiliate, providing for   
the payment by Global Crossing of an advisory fee of 2% of the gross revenues   
of ACL over a 25 year term. Global Crossing's board of directors also approved  
similar advisory fees and authorized Global Crossing to enter into similar      
agreements with respect to other cable systems under development by Global      
Crossing. In June 1998, Global Crossing acquired the rights of the persons      
entitled to the fees payable under these agreements in consideration for the    
issuance to those persons of shares of Global Crossing's common stock, which    
had an aggregate value of $135 million, and the cancellation of approximately   
$3 million owed Global Crossing under a related advance agreement. In addition, 
Global Crossing recognized approximately $2 million of advisory fees incurred   
prior to termination of the contract.                                           

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Equity in loss of affiliates. In April 1998, Global Crossing entered into a 
joint venture to construct an undersea cable system, PC-1. PC-1 is owned and    
operated by Pacific Crossing Ltd. (PCL). Global Crossing has an economic        
interest in PCL represented by a 50% direct voting interest and, through one of 
the joint venture partners, owns a further 8% economic non-voting interest. In  
December 1998, a wholly-owned subsidiary of Global Crossing entered into a      
joint venture to construct and operate GAL. The $3 million loss is comprised of 
a loss of $1 million representing Global Crossing's 58% equity in the loss of   
PCL and a loss of $2 million representing Global Crossing's 49% equity in       
Global Access Ltd. for the three months ended June 30, 1999.                    

 Interest income. Global Crossing earned interest income of $17 million and $4
million in the three months ended June 30, 1999 and 1998, respectively. Such    
interest income represents earnings on cash raised from financings and on CPA   
deposits.                                                                       

Interest expense. During the three months ended June 30, 1999, Global       
Crossing incurred $32 million in interest costs, including the amortization of  
finance costs and debt discount. Of this amount, Global Crossing capitalized to 
construction in progress interest of $9 million, and expensed $23 million.      
During the three months ended June 30, 1998, Global Crossing incurred $21       
million in interest costs, including the amortization of finance costs and debt 
discount. Of this amount, Global Crossing capitalized to construction in        
progress interest of $14 million, and expensed $7 million.                      

Other expense, net. During the three months ended June 30, 1999, other      
expense, net was comprised primarily of a $10 million loss on a foreign         
currency forward contract in connection with the Global Marine acquisition and  
$2 million in professional fees associated with the senior notes consent        
solicitation, offset partially by a $4 million gain on sale of securities       
available for sale.                                                             

Provision for income taxes. The income tax provision of $14 million and $9  
million for the three months ended June 30, 1999 and 1998, respectively,        
provides for taxes on profits earned from capacity sales and OA&M revenues      
where subsidiaries of Global Crossing have a presence in taxable jurisdictions. 

Extraordinary loss on retirement of senior notes. During May 1998, Global   
Crossing recognized an extraordinary loss of $20 million in connection with the 
repurchase of Global Telesystems Holdings' outstanding senior notes, comprising 
of a premium of $10 million and a write-off of $10 million of unamortized       
deferred financing costs.                                                       

Net income (loss). During the three months ended June 30, 1999, Global      
Crossing reported net income of $10 million compared to a net loss of $155      
million in the three months ended June 30, 1998.                                

Preferred stock dividends. Preferred stock dividends for the three months   
ended June 30, 1999 and 1998 were $14 million and $4 million, respectively.     

 Redemption of preferred stock. The redemption of Global Telesystems Holdings'
outstanding preferred stock occurred in June 1998 and resulted in a $34 million 
charge against equity. This amount was comprised of a $16 million redemption    
premium and a write-off of $18 million of unamortized discount and issuance     
costs. The redemption premium and write-off of unamortized discount and         
issuance costs are treated as a deduction to arrive at net loss applicable to   
common shareholders in the consolidated statements of operations.               

Net loss applicable to common shareholders. During the three months ended   
June 30, 1999, Global Crossing reported a net loss applicable to common         
shareholders of $4 million, resulting in large part from $14 million of         
dividends on preferred stock. During the three months ended June 30, 1998,      
Global Crossing reported a net loss applicable to common shareholders of $193   
million, resulting in a large part from $140 million in costs associated with   
the termination of the advisory service agreement, $34 million redemption of    
preferred stock, $20 million extraordinary loss on retirement of senior notes   
and $4 million of preferred stock dividends.                                    

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Results of operations for the six months ended June 30, 1999 and June 30, 1998  

Revenues. Global Crossing's revenues on sales of capacity relating to AC-1  
increased to $356 million during the six months ended June 30, 1999 from $101   
million during the six months ended June 30, 1998. During the six months ended  
June 30, 1999 and 1998, operation and maintenance services revenue was $12      
million and none, respectively. The increase is primarily due to no sales or    
related costs recognized in the three months ended March 31, 1998, as Global    
Crossing was in its development stage.                                          

Cost of capacity sold. For the six months ended June 30, 1999 and 1998, the 
Company recognized $150 million and $41 million, respectively, in cost of       
capacity sold, resulting in a gross margin on capacity sales of 59%,            
respectively. Non-cash cost of undersea capacity sold was $114 million and $32  
million during the six months ended June 30, 1999 and 1998, respectively. Cost  
of capacity sold also includes the cost of terrestrial capacity sold, a cash    
expense, during the six months ended June 30, 1999 and 1998, of $36 million and 
$9 million, respectively.                                                       

Operations, administration and maintenance (OA&M). Global Crossing incurred 
OA&M costs on AC-1 of $26 million and $2 million during the six months ended    
June 30, 1999 and 1998, respectively. Global Crossing has entered into an       
agreement with TSSL relating to operations, administration and maintenance of   
AC-1 which limits Global Crossing's total OA&M expense for the system. Global   
Crossing anticipates that its recurring OA&M costs will be largely recovered    
through charges to its customers under the terms of CPAs.                       

General and administrative. General and administrative expenses totaled $45 
million during the six months ended June 30, 1999 and were comprised            
principally of salaries, employee benefits and recruiting fees reflecting       
Global Crossing's staffing for multiple systems, travel, professional fees,     
insurance costs and occupancy costs. During the six months ended June 30, 1998, 
Global Crossing incurred general and administrative expenses of $9 million.     

Sales and marketing. During the six months ended June 30, 1999, Global      
Crossing incurred sales and marketing expenses of $23 million, including        
commissions to TSSL of $15 million incurred on revenues recognized during this  
period. During the six months ended June 30, 1998, Global Crossing incurred     
sales and marketing costs of $7 million, including commissions to TSSL of $3    
million incurred on revenues recognized during this period. The increase from   
1998 was due to additions in headcount, occupancy costs, plus marketing costs,  
commissions paid and other promotional expenses to support Global Crossing's    
rapid growth.                                                                   

Network development. Global Crossing incurred network development costs     
during the six months ended June 30, 1999 and 1998 of $10 million and $4        
million, respectively. These amounts are comprised principally of salaries and  
professional fees.                                                              

 Stock related expense. Global Crossing recognized $26 million and $23 million
of stock compensation expense during the six months ended June 30, 1999 and     
1998, respectively, relating to options issued under its Stock Incentive Plan,  
plus certain stock related expense related to stock options awarded to          
consultants, accounted for under SFAS No. 123.                                  

Depreciation and amortization. For the six months ended June 30, 1999 and   
1998, Global Crossing incurred depreciation and amortization of $4 million and  
$0.4 million, respectively.                                                     

Provision for doubtful accounts. For the six months ended June 30, 1999 and 
1998, Global Crossing recorded a provision for doubtful accounts of $4 million  
and $1 million, respectively.                                                   

Termination of advisory services agreement. In connection with the          
development and construction of AC-1, Global Crossing entered into an advisory  
services agreement with PCG Telecom Services LLC, an affiliate, providing for   
the payment by Global Crossing of an advisory fee of 2% of the gross revenues   
of ACL over a 25 year term. Global Crossing's board of directors also approved  
similar advisory fees and authorized Global Crossing to enter into similar      
agreements with respect to other cable systems under development by             

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Global Crossing. In June 1998, Global Crossing acquired the rights of the       
persons entitled to the fees payable under these agreements in consideration    
for the issuance to those persons of shares of Global Crossing's common stock,  
which had an aggregate value of $135 million, and the cancellation of           
approximately $3 million owed Global Crossing under a related advance           
agreement. In addition, Global Crossing recognized approximately $2 million of  
advisory fees incurred prior to termination of the contract.                    

Equity in loss of affiliates. In April 1998, Global Crossing entered into a 
joint venture to construct an undersea cable system, PC-1. PC-1 is owned and    
operated by PCL. Global Crossing has an economic interest in PCL represented by 
a 50% direct voting interest and, through one of the joint venture partners,    
owns a further 8% economic non-voting interest. In December 1998, a wholly-     
owned subsidiary of Global Crossing entered into a joint venture to construct   
and operate GAL. The $6 million loss is comprised of a loss of $2 million       
representing Global Crossing's 58% equity in the loss of PCL and a loss of $4   
million representing Global Crossing's 49% equity in Global Access Ltd. for the 
six months ended June 30, 1999.                                                 

 Interest income. Global Crossing earned interest income of $32 million and $4
million in the six months ended June 30, 1999 and 1998, respectively. This      
interest income represents earnings on cash raised from financings and on CPA   
deposits.                                                                       

Interest expense. During the six months ended June 30, 1999, Global Crossing
incurred $61 million in interest costs, including the amortization of finance   
costs and debt discount. Of this amount, Global Crossing capitalized to         
construction in progress interest of $15 million, and expensed $46 million.     
During the six months ended June 30, 1998, Global Crossing incurred $32 million 
in interest costs, including the amortization of finance costs and debt         
discount. Of this amount, Global Crossing capitalized to construction in        
progress interest of $25 million, and expensed $7 million.                      

 Other expense, net. During the six months ended June 30, 1999, other expense,
net was comprised primarily of a $10 million loss on a foreign currency forward 
contract in connection with the Global Marine acquisition and $2 million in     
professional fees associated with the senior notes consent solicitation, offset 
partially by a $4 million gain on sale of securities available for sale.        

Provision for income taxes. The income tax provision of $30 million and $9  
million for the six months ended June 30, 1999 and 1998, respectively, provides 
for taxes on profits earned from capacity sales and OA&M revenues where         
subsidiaries of Global Crossing have a presence in taxable jurisdictions.       

Cumulative effect of change in accounting principle. Global Crossing adopted
Statement of Position 98-5 (SOP 98-5), "Reporting on the Cost of Start-Up       
Activities," issued by the American Institute of Certified Public Accountants,  
during the three months ended March 31, 1999. SOP 98-5 requires that certain    
start-up expenditures previously capitalized during system development must now 
be expensed. Global Crossing incurred a one-time charge during the three months 
ended March 31, 1999 of $15 million (net of tax benefit) that represents start- 
up costs incurred and capitalized during previous periods.                      

Extraordinary loss on retirement of senior notes. During May 1998, Global   
Crossing recognized an extraordinary loss of $20 million in connection with the 
repurchase of Global Telesystems Holdings' outstanding senior notes, comprising 
of a premium of $10 million and a write-off of $10 million of unamortized       
deferred financing costs.                                                       

Net income (loss). During the six months ended June 30, 1999 Global Crossing
reported net income of $8 million compared to a net loss of $159 million in the 
six months ended June 30, 1998.                                                 

 Preferred stock dividends. Preferred stock dividends for the six months ended
June 30, 1999 and 1998, were $27 million and $8 million, respectively.          

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 Redemption of preferred stock. The redemption of Global Telesystems Holdings'
outstanding preferred stock occurred in June 1998 and resulted in a $34 million 
charge against equity. This amount was comprised of a $16 million redemption    
premium and a write-off of $18 million of unamortized discount and issuance     
costs. The redemption premium and write-off of unamortized discount and         
issuance costs are treated as a deduction to arrive at net loss applicable to   
common shareholders in the consolidated statements of operations.               

Net loss applicable to common shareholders. During the six months ended June
30, 1999, Global Crossing reported a net loss applicable to common shareholders 
of $19 million, resulting in large part from $27 million of dividends on        
preferred stock and $15 million resulting from a cumulative effect of change in 
accounting principle. During the six months ended June 30, 1998, Global         
Crossing reported a net loss applicable to common shareholders of $202 million, 
resulting in a large part from $140 million in costs associated with the        
termination of the advisory service agreement and $42 million of dividends on   
preferred stock.                                                                

Results of operations for the year ended December 31, 1998 and the period from  
March 19, 1997 (date of inception) to December 31, 1997                         

Revenues                                                                      

 During the year ended December 31, 1998, Global Crossing executed commitments
with its customers to purchase capacity on its systems plus the sale of dark    
fiber on PEC totaling $911 million, bringing the total since inception to       
$1,052 million. Of this amount, Global Crossing recognized revenues of $418     
million on sales of capacity relating to AC-1 for the year ended December 31,   
1998, in addition to revenues from operations and maintenance services of $6    
million. The remaining $634 million of capacity sales has not yet been          
reflected as revenue in the consolidated financial statements because either    
the segment has not reached RFS or the purchaser has not obtained the right to  
use the capacity. During the year ended December 31, 1998, Global Crossing      
entered into CPAs with 33 international telecommunications carriers and sold    
approximately 35% of the sales capacity of 512 circuits on the AC-1 system.     

Expenses                                                                      

Cost of capacity sold. For the year ended December 31, 1998, Global Crossing
recognized $178 million in cost of capacity sold, resulting in a gross margin   
on capacity sales of 57%. Cost of capacity sold for the year ended December 31, 
1998 also includes $38 million relating to terrestrial capacity sold which      
Global Crossing had purchased from third parties. Global Crossing calculates    
undersea cost of capacity sold for AC-1 based on the ratio of the period's      
actual revenue to total expected revenues, assuming minimum projected sales     
capacity of 512 circuits, multiplied by the construction cost of the system.    
This calculation of cost of sales matches costs with the relative value of each 
sale. There were no sales or related costs recognized during the period from    
March 19, 1997 (date of inception) to December 31, 1997, as Global Crossing was 
in its development stage.                                                       

Operations, administration and maintenance. Global Crossing incurred OA&M   
costs of $18 million during the year ended December 31, 1998. Global Crossing   
entered into an agreement with TSSL relating to operations, administration and  
maintenance of AC-1, which limits Global Crossings total OA&M expense for the   
system. Global Crossing anticipates that its OA&M costs will be largely         
recovered through charges to its customers under the terms of CPAs. There were  
no OA&M costs during the period from March 19, 1997 (date of inception) to      
December 31, 1997, as Global Crossing was in its development stage.             

 Sales and marketing. During the year ended December 31, 1998, Global Crossing
incurred sales and marketing expenses of $26 million, including selling         
commissions of $20 million incurred on capacity sales recognized during this    
period. During the period from March 19, 1997 (date of inception) to December   
31, 1997, Global Crossing incurred sales and marketing costs of approximately   
$1 million. The increase from 1997 was due to additions in personnel and        
occupancy costs, plus marketing, commissions paid and other promotional         
expenses to support our rapid growth.                                           

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Network development. Global Crossing incurred network development costs     
during the year ended December 31, 1998 of $11 million relating to the          
development of systems. During the period from March 19, 1997 (date of          
inception) to December 31, 1997, these costs were $0.1 million. The increase    
from 1997 was due to additional personnel, and costs to explore new projects.   

General and administrative. General and administrative expenses totaled $27 
million during the year ended December 31, 1998 and were comprised principally  
of salaries, employee benefits and recruiting fees for staffing of multiple     
systems, travel, insurance costs and rent expenses, plus depreciation and       
amortization. During the period from March 19, 1997 (date of inception) to      
December 31, 1997, Global Crossing incurred general and administrative costs of 
$2 million.                                                                     

Termination of advisory services agreement with PCG Telecom Services LLC. In
connection with the development and construction of AC-1, Global Crossing       
entered into an advisory services agreement with PCG Telecom Services LLC, an   
affiliate, providing for the payment by Global Crossing of an advisory fee of   
2% of the gross revenues of ACL over a 25 year term. Global Crossing's board of 
directors also approved similar advisory fees and authorized Global Crossing to 
enter into similar agreements with respect to other cable systems under         
development by Global Crossing. Global Crossing has acquired the rights of the  
persons entitled to the fees payable under these agreements in consideration    
for the issuance to such persons of shares of Global Crossing common stock,     
which had at the time of issuance an aggregate value of $135 million, and the   
cancellation of approximately $3 million owed to Global Crossing under a        
related advance agreement. In addition, Global Crossing recognized              
approximately $2 million of advisory fees incurred prior to termination of the  
contract.                                                                       

 Stock related expense. Through December 31, 1998, Global Crossing recorded as
a charge to paid-in capital $94 million of unearned compensation relating to    
awards under Global Crossing's stock incentive plan plus the grant of certain   
economic rights and options to purchase common stock granted to a senior        
executive. The unearned compensation is being recognized as an expense over the 
vesting period of these options and economic rights.                            

For the year ended December 31, 1998, Global Crossing recognized as an      
expense $31 million of stock related compensation relating to Global Crossing's 
stock incentive plan and $6 million for the vested economic rights to purchase  
common stock and $2 million in respect of shares of common stock issued during  
the year. The remaining $57 million of unearned compensation will be recognized 
as follows: $28 million in 1999, $21 million in 2000 and $8 million in 2001.    
Global Crossing's stock incentive plan commenced in January 1998, and therefore 
no issuances were made during the period from March 19, 1997 (date of           
inception) to December 31, 1997.                                                

 Equity in loss of affiliates. During 1998, Global Crossing entered into joint
venture agreements to construct and operate PC-1 and GAL. PC-1 is owned and     
operated by Pacific Crossing Ltd. ("PCL"). Global Crossing has an economic      
interest in PCL represented by a 50% direct voting interest and, through one of 
the joint venture partners, a further 8% economic non-voting interest. Global   
Crossing has a 49% interest in Global Access Ltd., which operates GAL. Global   
Crossing's equity in the loss of PC-1 for the year ended December 31, 1998 was  
$3 million.                                                                     

Interest income and interest expense                                          

Interest income. Global Crossing reported interest income of $30 million    
during the year ended December 31, 1998 and $3 million during the period from   
March 19, 1997 (date of inception) to December 31, 1997. Such interest income   
represents earnings on cash raised from financings, the IPO, the issuance of    
the GCH Preferred Stock, operations and CPA deposits.                           

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Interest expense. During the year ended December 31, 1998, Global Crossing  
incurred $93 million in interest costs, including the amortization of finance   
costs and debt discount. Of this amount, Global Crossing capitalized to         
construction in progress interest of $50 million and expensed $43 million.      
During the period from March 19, 1997 (date of inception) to December 31, 1997, 
Global Crossing incurred interest expense of $10 million, which was capitalized 
to construction in progress.                                                    

Provision for income taxes                                                    

The income tax provision of $33 million for the year ended December 31, 1998
provides for taxes on profits earned from capacity sales and OA&M revenues      
where Global Crossing's subsidiaries have a presence in taxable jurisdictions.  
During the period from March 19, 1997 (date of inception) to December 31, 1997, 
Global Crossing incurred operating losses, which relate to non-taxable          
jurisdictions and therefore cannot be applied against future taxable earnings.  
Accordingly, no tax provision or deferred tax benefit was recorded as of        
December 31, 1997.                                                              

Extraordinary item                                                            

During May 1998, Global Crossing recognized an extraordinary loss of $20    
million in connection with the repurchase of outstanding Global Telesystems     
Holdings senior notes (the "GTH Senior Notes"), comprising of a premium of $10  
million and a write-off of $10 million of unamortized deferred financing costs. 

Preferred stock dividends                                                     

During the year ended December 31, 1998, Global Crossing recorded preferred 
stock dividends of approximately $13 million. Preferred stock dividends for the 
period from March 19, 1997 (date of inception) to December 31, 1997 were $13    
million. Of the $13 million recorded in 1998, $4 million relates to the GCH     
Preferred Stock issued during December 1998.                                    

Redemption of preferred stock                                                 

The redemption of Global Telesystems Holdings outstanding preferred stock   
(the "GTH Preferred Stock") occurred in June 1998 and resulted in a $34 million 
charge against equity. This amount was comprised of a $16 million redemption    
premium and a write-off of $18 million of unamortized discount and issuance     
costs. The redemption premium and write-off of unamortized discount and         
issuance costs are treated as a deduction to arrive at net loss applicable to   
common shareholders in the consolidated statements of operations.               

Net loss and net loss applicable to common shareholders                       

Global Crossing incurred a net loss of $88 million for the year ended       
December 31, 1998, compared to a net loss of $0.2 million in the period from    
March 19, 1997 (date of inception) to December 31, 1997. The net loss for the   
year ended December 31, 1998 reflects an extraordinary loss on retirement of    
the GTH Senior Notes of $20 million and a non-recurring charge of $140 million  
relating to the termination of the advisory services agreement with PCG Telecom 
Services. Global Crossing's net income before these items was $72 million.      

During the year ended December 31, 1998, Global Crossing reported a net loss
applicable to common shareholders of $135 million. This loss reflects preferred 
stock dividends of $13 million and the redemption cost of GTH Preferred Stock   
of $34 million. During the period from March 19, 1997 (date of inception) to    
December 31, 1997, Global Crossing incurred a net loss applicable to common     
shareholders of $13 million after GTH Preferred Stock dividends of $13 million. 

Balance sheet as of December 31, 1998                                         

 Restricted cash and cash equivalents, both current and long term. At December
31, 1998, current and long-term restricted cash and cash equivalents included:  
(1) $231 million restricted for PC-1 construction, (2)                          

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$89 million received pursuant to CPAs on AC-1 which may be used only in         
accordance with the terms of the AC-1 Credit Facility, (3) $66 million          
restricted for MAC construction, (4) $38 million reserved for funding future    
interest payable on the GCH Senior Notes and (5) $21 million restricted for     
miscellaneous items.                                                            

Capacity available for sale, construction in progress and investment in     
affiliates. Global Crossing's investment in capacity available for sale,        
construction in progress and investment in affiliates totaled approximately     
$1,180 million as of December 31, 1998. This amount includes the value of       
system development contributed to Global Crossing by Pacific Capital Group.     
Upon Global Crossing's IPO, each PCG Warrant then outstanding was converted     
into a fraction of Global Crossing common stock based upon the ratio of the per 
share valuation at the time of conversion less the per share exercise price of  
the warrants, divided by the per share valuation at the time of conversion,     
together with a new warrant (the "New PCG Warrants") to purchase the remaining  
fraction of shares at an exercise price equal to $9.50, the price to public per 
share of the IPO. These amounts increased additional paid-in capital by $275    
million and was allocated on a pro rata basis to PCL, PAC and MAC according to  
the estimated cost of each system. Accordingly, Global Crossing recorded $163   
million as an investment in PCL and $64 million and $48 million as Construction 
in Progress for PAC and MAC, respectively.                                      

Long term debt and senior notes. The long term debt of $270 million as of   
December 31, 1998 represents primarily the long term portion of our outstanding 
balance on the AC-1 Credit Facility. The senior notes balance of $796 million   
represents the net proceeds from the issuance of the GCH Senior Notes, adjusted 
for the unamortized amount of the debt discount.                                

Mandatorily redeemable preferred stock. The mandatorily redeemable preferred
stock of $487 million as of December 31, 1998 represents the net proceeds       
received from the $500 million offering of GCH Preferred Stock during December  
1998, less $17 million in fees and issuance costs plus $4 million in accrued    
dividends. These fees and issuance costs are being amortized over the term of   
the obligation.                                                                 

 During the year ended December 31, 1998, Global Crossing reimbursed an amount
of $7 million to Pacific Capital Group, a shareholder, relating to system       
evaluation costs incurred by Pacific Capital Group. This amount was treated as  
a dividend and charged against additional paid-in capital.                      

Liquidity and capital resources                                                 

Restricted cash and investments. At June 30, 1999, restricted cash and      
investments includes: $231 million for PC-1 construction, $61 million for PEC   
construction, $10 million for MAC construction and $110 million received        
pursuant to CPAs restricted under the terms of the AC-1 credit facility. In     
connection with the Senior Secured Credit Facility, all restrictions under      
refinanced debt on cash and investments have been removed.                      

On July 2, 1999, Global Crossing entered into a $3 billion senior secured   
corporate credit facility with a group of several lenders and The Chase         
Manhattan Bank as administrative agent. The initial proceeds under the facility 
were used to refinance outstanding balances under the AC-1 and MAC project      
finance facilities, to refinance balances under a vendor financing arrangement  
with Lucent, to refinance debt used for the purchase of the Global Marine       
business from Cable & Wireless and for general corporate purposes. Global       
Crossing intends to finance the remainder of its announced systems, new         
projects and working capital needs mainly through the new corporate facility    
and other corporate financing.                                                  

As of June 30, 1999, the approximately $750 million initial cost of AC-1 had
been fully financed. The first contracted upgrade was funded through cash on    
hand, as will the second contracted upgrade. All remaining amounts outstanding  
under the AC-1 non-recourse project finance credit facility were refinanced in  
July 1999 through Global Crossing's new senior secured corporate credit         
facility.                                                                       

Global Crossing estimates the total cost of developing and deploying AC-2,  
PC-1, MAC, PAC, SAC, PEC and GAL to be approximately $5,095 million, excluding  
costs of potential future upgrades and the amounts                              

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capitalized with respect to warrants issued in exchange for the rights to       
construct PC-1, MAC and PAC. This total is comprised of $750 million for AC-2,  
$1,200 million for PC-1, $295 million for MAC, $580 million for PAC, $1,130     
million for SAC, $950 million for PEC and $190 million for GAL. PC-1 will be    
financed by total equity investments of $400 million of which Global Crossing   
expects to provide approximately $231 million, with the remaining $800 million  
of estimated costs to be financed through non-recourse project indebtedness at  
the PC-1 level. Global Crossing has financed its 49% interest in GAL through    
cash on hand to date, and intends to finance additional system costs through    
limited or non-recourse debt to be raised at the GAL level. The remaining       
system costs for MAC and PAC will be financed either through bank indebtedness  
under Global Crossing's new senior secured corporate credit facility or through 
other corporate financing.                                                      

The construction costs for PEC (including costs of acquiring dark fiber) are
estimated to be $950 million, a portion of which was paid from the proceeds of  
the December 1998 issuance by Global Crossing Holdings of 10 1/2% Senior        
Exchangeable Preferred Stock (the "GCH Preferred Stock"). Global Crossing also  
raised capital required to finance this system through a combination of         
commercial bank borrowings, vendor financing and sales of dark fiber. Financing 
to complete the system is expected to be obtained from the corporate credit     
facility or other corporate financing.                                          

Global Crossing initially financed the approximately $868 million Global    
Marine acquisition, which was completed in July 1999, with approximately $600   
million in committed bank financing and the remainder with cash on hand. This   
initial indebtedness was refinanced through borrowings under Global Crossing's  
new senior secured corporate credit facility.                                   

The Company has extended financing to customers in connection with certain  
CPAs. The financing terms provide for installment payments of up to four years. 
The Company believes that its extension of financing to its customers will not  
have a material effect on the Company's liquidity.                              

Cash provided by operating activities was $64 million for the six months    
ended June 30, 1999 and $37 million for the six months ended June 30, 1998, and 
principally represents cash received from deposits and payments for activated   
capacity pursuant to signed CPAs, plus interest income received, less sales and 
marketing, network development and general and administrative expenses paid.    

Cash provided by operating activities was $209 million for the year ended   
December 31, 1998 and $5 million for the period from March 19, 1997 (date of    
inception) to December 31, 1997, which principally represents cash received     
from deposits and payments for activated capacity pursuant to signed CPAs, plus 
interest income, less sales and marketing, network development and general and  
administrative expenses paid.                                                   

Cash provided by financing activities was $292 million for the six months   
ended June 30, 1999 and primarily represents borrowings under the Lucent        
facility, partially offset by repayments of borrowings under long term debt.    
Cash provided by financing activities was $456 million for the six months ended 
June 30, 1998 and primarily relates to proceeds from the issuance of senior     
notes and borrowings under long term debt, less the increase in the restricted  
cash and cash equivalents, retirement of old senior notes and redemption of     
preference shares.                                                              

Cash provided by financing activities was $1,027 million for the year ended 
December 31, 1998 and primarily represents borrowings under the AC-1 and MAC    
credit facilities, proceeds from the issuance of GCH Senior Notes, the GCH      
Preferred Stock and Global Crossing's IPO, less amounts paid for finance and    
organization costs, the issuance of common and preferred stock, the repayment   
of long term debt, the redemption of the GTH Preferred Stock, the retirement of 
the GTH Senior Notes and the increase in amounts held in restricted cash and    
cash equivalents. At December 31, 1998, Global Crossing's working capital       
amounted to $750 million.                                                       

During May 1998, Global Crossing obtained $796 million in net proceeds from 
the issuance of the GCH Senior Notes due 2008. These proceeds were used (1) to  
purchase all of the $150 million aggregate principal                            

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amount of outstanding GTH Senior Notes, (2) to redeem all of the $100 million   
aggregate principal amount of outstanding GTH Preferred Stock, (3) to repay in  
full the $67 million then outstanding under a bridge credit facility, (4) to    
make approximately $315 million of equity investments in PC-1, MAC and PAC and  
(5) for general corporate purposes, including $74 million to fund a one-year    
interest reserve on the GCH Senior Notes. In August 1998, Global Crossing       
completed its IPO, from which it received net proceeds of $391 million, and     
during December 1998, the GCH Preferred Stock was issued, from which net        
proceeds of approximately $483 million were received. Global Crossing has used  
these proceeds for (1) construction of the Global Crossing Network, (2)         
investment in telecommunications companies and ISPs, (3) investments in GAL and 
(4) general corporate purposes.                                                 

Cash provided by financing activities of $425 million for the period from   
March 19, 1997 (date of inception) to December 31, 1997, relates to net         
proceeds from the issuance of common stock, GTH Preferred Stock and GTH Senior  
Notes and borrowings under the AC-1 credit facility, less finance and           
organization costs related to the issuance of common and preferred stock and    
the increase in proceeds held in restricted cash and cash equivalents. At       
December 31, 1997, Global Crossing's working capital deficit was $63 million.   

Cash used in investing activities was $486 million and $191 million for the 
six months ended June 30, 1999 and 1998, respectively, and represents cash paid 
for construction in progress, purchases of property, plant and equipment and    
cash investments in affiliates.                                                 

Cash used in investing activities was approximately $431 million and $429   
million for the year ended December 31, 1998 and the period from March 19, 1997 
(date of inception) to December 31, 1997, respectively, and represents cash     
paid for construction in progress, capacity available for sale and investments  
in affiliates.                                                                  

Global Crossing has extended financing to a small number of customers in    
connection with certain CPAs. The financing terms provide for installment       
payments over a period of up to four years. Global Crossing believes that its   
extension of financing to its customers will not have a material effect on its  
liquidity.                                                                      

Global Crossing believes that its current cash and cash equivalents, credit 
facilities and cash generated from operations will satisfy its expected working 
capital and capital expenditure requirements through December 31, 1999.         

Inflation                                                                       

Management does not believe that Global Crossing's business is impacted by  
inflation to a significantly different extent than the general economy.         

Year 2000 compliance                                                            

Global Crossing believes that its computer information systems are Year 2000
("Y2K") compliant. Global Crossing has established a Y2K compliance task force. 
The task force has identified no potential material adverse effect on the two   
core components of it services: (1) transmission of capacity and (2) management 
and maintenance of the transmission paths. Global Crossing's anticipated worst  
case scenario is failure of its Network Operations Center. In the event the     
worst case scenario occurs, management of the network can be performed at the   
terminal stations with the network element managers or at the equipment bays    
with the craft interface terminal. No or minimal additional cost would be       
incurred as Global Crossing has already included the cost for back-up           
management of the network into the AC-1 business case analysis.                 

Global Crossing is also subject to external forces that generally affect    
industry and commerce, such as utility, transportation or other infrastructure  
failures and interruptions. In addition to reviewing its own systems, Global    
Crossing is submitting requests to third party service providers to obtain      
information as to their compliance efforts. Global Crossing has received        
assurances from its major suppliers, TSSL and Lucent, stating                   

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Y2K compliance status of their respective systems regarding AC-1, Global        
Crossing's only active system at this time. In addition, Global Crossing        
received assurance from Alcatel, a supplier to MAC, that Alcatel is also Y2K    
compliant. In the event that any of its material third party service providers  
do not successfully and timely achieve Y2K compliance, Global Crossing's        
business or operations could be adversely affected. Global Crossing is          
developing contingency plans to address any potential Y2K compliance failure    
due to significant third party failures, although no such failure is expected.  
To date, response from material third party service providers has not shown any 
of them to be non-compliant with Y2K readiness plans.                           

 Global Crossing believes that costs of addressing its Y2K compliance will not
have a material adverse impact on its financial condition or results of         
operations.                                                                     

Euro conversion                                                                 

On January 1, 1999, a single currency called the Euro was introduced in     
Europe. Eleven of the fifteen member countries of the European Union agreed to  
adopt the Euro as their common legal currency on that date. Fixed conversion    
rates between these countries' existing currencies, called legacy currencies,   
and the Euro were established as of that date. The legacy currencies are        
scheduled to remain legal tender in these participating countries between       
January 1, 1999 and January 1, 2002, but not later than July 1, 2002. During    
this transition period, parties may settle transactions using either the Euro   
or a participating country's legacy currency.                                   

 As most of Global Crossing's sales and expenditures are denominated in United
States dollars, management does not believe that the Euro conversion will have  
a material adverse impact on its business or financial condition. Global        
Crossing does not expect the cost of system modifications to be material, and   
it will continue to evaluate the impact of the Euro conversion.                 

Quantitative and qualitative disclosures about market risk                      

Interest Rate Risk                                                            

 The table below provides information about Global Crossing's market sensitive
financial instruments and constitutes a "forward-looking statement." Global     
Crossing's major market risk exposure is changing interest rates. Global        
Crossing's policy is to manage interest rates through use of a combination of   
fixed and floating rate debt. Interest rate swaps may be used to adjust         
interest rate exposures when appropriate, based upon market condition.          

                                                        [Enlarge/Download Table]

                                                                                  Fair Value
                                                                                   June 30, 
 Expected maturity dates    1999    2000     2001   2002 2003 Thereafter  Total      1999   
 -----------------------  -------- ------- -------- ---- ---- ---------- -------- ----------
                                                    (in thousands)                          
                                                                                            
DEBT                                                                                        
Non Current--US$                                                                            
 denominated                                                                                
AC-1 Credit Facility....  $  9,137 $14,298 $127,080 --   --        --    $150,515  $150,515 
 Average interest                                                                           
  rates--variable.......       (1)     (1)      (1)                                         
MAC Credit Facility.....       --    9,192      --  --   --        --       9,192     9,192 
 Average interest                                                                           
  rates--variable.......               (2)                                                  
Lucent Financing........   400,000     --       --  --   --        --     400,000   400,000 
 Average interest                                                                           
  rates--variable.......       (3)                                                          
Senior notes............       --      --       --  --   --    800,000    800,000   836,000 
 Average interest                                                                           
  rates--fixed..........                                           9.6%                     
Mandatorily Redeemable                                                                      
 Preferred Stock........       --      --       --  --   --    500,000    500,000   522,500 
 Average interest                                                                           
  rates--fixed..........                                          10.5%                     
Obligations under ISAs                                                                      
 and capital lease                                                                          
 obligations:                                                                               

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                                                        [Enlarge/Download Table]

                                                                                  Fair Value
                                                                                   June 30, 
Expected maturity dates   1999     2000   2001   2002   2003   Thereafter  Total     1999   
-----------------------  -------  ------  -----  -----  -----  ---------- ------- ----------
                                                 (in thousands)                             
                                                                                            
US$ denominated.........  27,371  18,174  1,080  1,081  1,081    20,112    68,899   68,899  
 Average interest                                                                           
  rates--fixed..........    10.5%   10.5%  10.5%  10.5%  10.5%     10.5%                    
Sterling, German Mark                                                                       
 and Dutch Guilder                                                                          
 denominated............   8,223   4,000  4,155  4,316  4,483   134,194   159,371  159,371  
 Average interest                                                                           
  rates--fixed..........    12.2%   12.2%  12.2%  12.2%  12.2%     12.2%                    
DERIVATIVE INSTRUMENTS                                                                      
Foreign currency                                                                            
 forward--Sterling                                                                          
 denominated                                                                                
 Contract notional                                                                          
  amount................ 877,058     --     --     --     --        --    877,058   (9,653) 
   Fixed conversion                                                                         
    rate................  1.5947                                                            

--------                                                                        
(1) The interest rate is two-week LIBOR plus 2.00%, which was 7.30% as of June  
30, 1999.                                                                 
(2) The interest rate is one month LIBOR plus 3.00%, which was 8.00% as of June 
30, 1999.                                                                 
(3) The interest rate is one month LIBOR plus 0.25%, which was 5.25% as of June 
30, 1999.                                                                 

Foreign Currency Risk                                                           

For those subsidiaries using the U.S. dollar as their functional currency,  
translation adjustments are recorded in the accompanying condensed consolidated 
statements of operations. None of Global Crossing's translation adjustments     
were material as of and for the three months ended June 30, 1999 and 1998.      

For those subsidiaries not using the U.S. dollar as their functional        
currency, assets and liabilities are translated at exchange rates in effect at  
the balance sheet date and income and expense accounts at average exchange      
rates during the period. Resulting translation adjustments are recorded         
directly to a separate component of shareholders' equity. As of and for the     
three and six months ended June 30, 1999, Global Crossing incurred a foreign    
currency translation loss of $4 million and $9 million, respectively. As of and 
for the three and six months ended June 30, 1998, Global Crossing incurred no   
foreign currency translation gain or loss.                                      

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Stock Ownership Of Management, Directors and
5% Shareholders of Global Crossing

The following table sets forth, as of July 29, 1999, information regarding  
the beneficial ownership of Global Crossing common stock by (1) each person or  
entity who is known to Global Crossing to own beneficially 5% or more voting    
common stock of Global Crossing, (2) each director and executive officer of     
Global Crossing and (3) all directors and executive officers of Global Crossing 
as a group. To Global Crossing's knowledge, each such shareholder has sole      
voting and investment power with respect to the shares shown, unless otherwise  
noted. Amounts appearing in the table below include (1) all shares of common    
stock outstanding as of July 29, 1999, (2) all shares of common stock issuable  
upon the exercise of options within 60 days of July 29, 1999 and (3) all shares 
of common stock issuable upon the exercise of warrants within 60 days of July   
29, 1999. The warrants described below as "New PCG Warrants" and "Global        
Crossing Warrants" each represent the right to immediately purchase shares of   
Global Crossing common stock at an exercise price of $9.50 per share.           

                                                        [Enlarge/Download Table]

                                      Beneficial Ownership of Common Stock             
                          -------------------------------------------------------------
                                                         Shares                        
                                                         Subject                       
                                      Shares Subject to    to       Shares             
                           Number of       New PCG       New GCL  Subject to Percentage
                           Shares(1)      Warrants      Warrants   Options    of Class 
                          ----------- ----------------- --------- ---------- ----------
                                                                                       
Pacific Capital Group,     87,591,172     6,050,004     2,515,788          0   21.69%  
 Inc.(2)................                                                               
 150 El Camino Drive,                                                                  
 Suite 204                                                                             
 Beverly Hills,                                                                        
 California 90212                                                                      
Canadian Imperial Bank                                                                 
 of Commerce(3).........   88,198,248             0             0    375,000   19.98%  
 161 Bay Street,                                                                       
 8th Floor -- BCE Place                                                                
 P.P. Box 500                                                                          
 M5J258, Toronto, Canada                                                               
U S WEST, Inc. .........   37,028,229             0             0          0    8.35%  
 7800 East Orchard Road                                                                
 Englewood, Colorado                                                                   
 80111                                                                                 
Continental Casualty       36,442,735             0             0          0    8.22%  
 Company................                                                               
 CNA Plaza, Floor 23                                                                   
 South                                                                                 
 Chicago, Illinois 60685                                                               
MRCo, Inc...............   30,109,522             0       697,934          0    6.95%  
 111 Massachusetts                                                                     
 Avenue NW Washington,                                                                 
 DC 20001                                                                              
Gary Winnick(4).........   87,591,172     6,050,004     2,515,788  1,200,000   21.96%  
Lodwrick M. Cook........    3,324,169       950,002             0    482,000    1.07%  
Jack M. Scanlon.........      239,520             0             0  1,462,588       *   
Thomas J. Casey(5)......      630,412             0             0          0       *   
Robert Annunziata.......            0             0             0    918,424       *   
William B. Carter.......      119,760             0             0  1,825,856       *   
Dan J. Cohrs............       10,000             0             0    708,668       *   
David L. Lee(6).........   18,559,028     1,825,002       663,456    600,000    4.88%  
Abbott L. Brown(7)......   10,460,679     1,450,002       367,666    600,000    2.91%  
Barry Porter(8).........   17,063,809     1,825,002       610,266    600,000    4.53%  
James C. Gorton.........            0             0             0    729,606       *   
Jack Finlayson..........       59,968             0             0    635,060       *   
Robert Sheh.............            0             0             0    283,685       *   
Hillel Weinberger(9)....   38,688,409             0             0     75,000    8.74%  
Jay R. Bloom(10)........   88,198,248             0             0    375,000   19.98%  
Dean C. Kehler(10)......   88,198,248             0             0    375,000   19.98%  
Jay R. Levine(10)(11)...   88,198,248             0             0    375,000   19.98%  
William P.                                                                             
 Phoenix(10)(11)........   88,198,248             0             0    375,000   19.98%  
Bruce Raben(10)(11).....   88,198,248             0             0    375,000   19.98%  
Michael R. Steed(12)....   30,109,522             0       697,934     75,000    6.97%  
William E. Conway(13)...    2,023,677             0             0     75,000       *   
Geoffrey J.W. Kent......            0             0             0     75,000       *   
All Directors and                                                                      
 Executive Officers as a                                                               
 Group..................  297,023,256    12,100,012     4,855,110 10,720,887   73.25%  

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--------                                                                        
*  Percentage of shares beneficially owned does not exceed one percent.     
(1)  As of July 29, 1999, 412,732,100 shares of common stock were issued and  
   outstanding. An additional 12,946,366 shares of common stock would have
 been issuable upon the exercise of options within 60 days of July 29,
 1999; an additional 12,500,012 shares of common stock would have been
     issuable upon the exercise of New PCG Warrants within 60 days of July 29,
   1999 and an additional 5,108,358 shares of common stock would have been
    issuable upon the exercise of Global Crossing Warrants within 60 days of
July 29, 1999.                                                      
(2)  Includes shares of common stock and common stock warrants owned by GKW   
  Unified Holdings, a company formed for the benefit of Gary Winnick and
members of his family and managed by Pacific Capital Group.         
(3)  Includes shares of common stock issuable upon the exercise of options    
     granted to Global Crossing directors employed by an affiliate of Canadian
Imperial Bank of Commerce.                                          
(4)  Includes (a) all shares of common stock and shares of common stock       
    issuable upon the exercise of warrants owned by GKW Unified Holdings, of
  which Pacific Capital Group is manager, (b) all shares of common stock
   and shares of common stock issuable upon the exercise of warrants owned
by Pacific Capital Group, of which Mr. Winnick is Chairman and Chief
Executive Officer and (c) all shares of common stock held by Casey  
   Pacific Holdings LLC, which Pacific Capital Group controls for purposes
of voting.                                                          
(5)  Includes (a) all shares of common stock owned by Casey Pacific Holdings  
LLC, which is beneficially owned by Mr. Casey and (b) all shares of 
  common stock owned by Casey Global Holdings LLC, which is beneficially
owned by Mr. Casey.                                                 
(6)  Includes (a) all shares of common stock and shares of common stock       
 issuable upon the exercise of warrants owned by San Pasqual Corp., of
     which Mr. Lee and his family are the sole shareholders and (b) all shares
    of common stock and shares of common stock issuable upon the exercise of
    warrants owned by the David and Ellen Lee Family Trust, of which Mr. Lee
is a trustee.                                                       
(7)  Includes (a) all shares of common stock and shares of common stock       
issuable upon the exercise of warrants owned by Ridgestone Corp., of
     which members of Mr. Brown's family are the sole shareholders and (b) all
shares of common stock and shares of common stock issuable upon the 
    exercise of warrants owned by the Brown Living Trust, of which Mr. Brown
is a trustee.                                                       
(8)  Includes all shares of common stock and shares of common stock issuable  
upon the exercise of warrants owned by Galenight Corp., of which Mr.
Porter is the sole shareholder.                                     
(9)  Includes all shares of common stock owned by Continental Casualty        
  Company, an affiliate of Loews/CNA Holdings Corp. Mr. Weinberger is an
    officer of Loews/CNA Holdings Corp. Includes shares of common stock held
by Global Crossing Trust 1998, with respect to which Mr. Weinberger 
 serves as trustee, and shares of common stock held by Global Crossing
Partners, of which Mr. Weinberger is a managing partner.            
(10)  Includes all shares of common stock beneficially owned by Canadian        
     Imperial Bank of Commerce. Each of Messrs. Bloom, Kehler, Levine, Phoenix
and Raben is employed by an affiliate of Canadian Imperial Bank of  
Commerce.                                                           
(11)  Beneficial ownership of all shares of common stock indicated is           
disclaimed.                                                         
(12)  Includes all shares of common stock owned by MRCo, Inc. Mr. Steed is the  
     Senior Vice President of ULLICO and the President of MRCo, Inc., which is
a wholly owned subsidiary of ULLICO.                                
(13)  Includes all shares of common stock beneficially owned by The Carlyle     
Group, of which Mr. Conway is managing director.                    

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Stock Ownership of Management, Directors and
5% Shareholders of Frontier 

The following table sets forth the number of shares of Frontier common stock
beneficially owned by each director, by each of the named executive officers    
and by directors and officers of Frontier as a group as of June 30, 1999. No    
director or officer beneficially owns more than 1% of Frontier's outstanding    
shares of common stock. The group's aggregate beneficial holdings constitute    
approximately 1.7% of Frontier's issued and outstanding common stock.           

Management and Directors Stock Ownership Table as of June 30, 1999              

                                                                [Download Table]

                                                           Total              
                                                Common     Stock    Beneficial
Name                                           Stock(1)  Options(2) Ownership 
----                                           --------- ---------- ----------
                                                                              
Directors:                                                                    
Patricia C. Barron............................    14,907    19,399     34,306 
Raul E. Cesan.................................    10,557    11,999     22,556 
Joseph P. Clayton.............................   485,897   399,999    885,896 
Brenda E. Edgerton............................    14,034    18,449     32,483 
Jairo A. Estrada..............................    30,771    19,999     50,770 
Michael E. Faherty............................   100,519    30,833    131,352 
Alan C. Hasselwander (3)......................    41,298    17,265     58,563 
Eric Hippeau..................................    17,321         0     17,321 
Robert Holland, Jr............................    11,256    11,666     22,922 
Douglas H. McCorkindale.......................    18,753    19,999     38,752 
James F. McDonald.............................     2,608         0      2,608 
Dr. Leo J. Thomas.............................    35,994    19,999     55,993 
Named Executive Officers:                                                     
Robert L. Barrett.............................   100,274   258,333    358,607 
Joseph P. Clayton.............................   485,897   399,999    885,896 
Jeremiah T. Carr..............................    51,963   266,066    318,029 
Rolla P. Huff.................................   154,124    83,332    237,456 
Donna L. Reeves-Collins.......................    10,250   108,566    118,816 
Directors and Executive Officers as a Group                                   
 (25 persons)................................. 1,191,893 1,834,101  3,025,994 

--------                                                                        
(1) Includes all shares which each director or officer directly, or through any 
contract, arrangement, understanding, relationship or otherwise, has or 
shares the power to vote or to direct the voting of such shares or to   
   dispose or to direct the disposition of such shares. Amounts in this column
include both vested and unvested restricted stock granted to selected   
   executive officers. However, these amounts do not include shares which each
 such person has the right to acquire pursuant to options or other rights.
(2) Includes all shares which such persons have the right to acquire within the 
sixty days following June 30, 1999, pursuant to options or other rights.
These amounts do not include shares which such persons have the right to
acquire more than sixty days after that date.                           
(3) Includes 1,480 shares owned by Mr. Hasselwander's spouse. Mr. Hasselwander  
disclaims beneficial ownership of these shares.                         

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Set forth below is the name, address and stock ownership of the only persons
or groups of persons known by Frontier to own beneficially more than 5% of the  
outstanding shares of common stock.                                             

5% Shareholders Stock Ownership Table as of June 30, 1999                       

                                                                [Download Table]

                                                            Number of         
                                                            Shares of  Percent
      Name and Address                                        Common     of   
    of Beneficial Owners                                      Stock     Class 
    --------------------                                    ---------- -------
                                                                              
Scudder Kemper Investments, Inc. (1)....................... 10,379,385  6.10% 
 345 Park Avenue                                                              
 New York, New York 10154                                                     

--------                                                                        
(1) Scudder Kemper Investments, Inc. filed with the Securities and Exchange     
Commission a Schedule 13G, dated February 12, 1999, stating that it     
beneficially owned as of December 31, 1998 in the aggregate 10,379,385  
shares of Frontier's common stock. In its Schedule 13G filing, Scudder  
   Kemper Investments, Inc. also disclosed that, with respect to the shares it
beneficially owns, it has sole voting power with respect to 4,207,085   
shares, shared voting power with respect to 5,706,000 shares, sole      
  dispositive power with respect to 10,270,285 shares and shared dispositive
power with respect to 109,100 shares.                                   

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Description of Global Crossing Capital Stock

The following summary is a description of the material terms of Global      
Crossing common stock, does not purport to be complete and is subject in all    
respects to the applicable provisions of Bermuda law and of the constituent     
documents of Global Crossing and each of its subsidiaries. The Global Crossing  
memorandum of association and bye-laws are filed as exhibits to the             
registration statement of which this document is a part.                        

Please note that some of the material terms of the Global Crossing common   
stock described in this section will change if the proposed amendments to the   
Global Crossing bye-laws are adopted at the annual meeting. See "Proposals to   
Global Crossing Shareholders To Be Voted on at the Global Crossing Annual       
Meeting--Proposals Nos. 3 and 4."                                               

General                                                                         

Pursuant to its memorandum of association, the authorized share capital of  
Global Crossing is $6,000,000, divided into 600,000,000 shares of common stock  
par value $.01 per share.                                                       

Voting and transfer restrictions                                                

Voting restriction. Each share of Global Crossing 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 Securities Exchange Act of 1934 and the     
rules and regulations promulgated under that act, more than 9.5% of the voting  
power of the common stock, or, in the case of Canadian Imperial Bank of         
Commerce and its affiliates, collectively, more than 35% of the total voting    
power of the Global Crossing capital stock, the number of votes of that         
shareholder will be limited to 9.5% of the aggregate voting power of the Global 
Crossing common stock, or, in the case of Canadian Imperial Bank of Commerce    
and its affiliates, collectively, to 35% of the aggregate voting power of the   
Global Crossing capital stock, based on a formula contained in the bye-laws.    
The additional votes that could be cast by that shareholder but for the         
restrictions on 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 limitation as a       
result of that allocation.                                                      

Transfer restriction. The 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        
certain lenders to any of them, beneficially owning within the meaning of       
Section 13(d) of the Exchange Act, directly or indirectly, 5% of the            
outstanding shares of common stock, if that shareholder is a natural person, or 
otherwise 9.5% of the outstanding shares of common stock, without the approval  
of a majority of the members of the board of directors and of shareholders      
representing at least 75% of the votes of all outstanding shares of common      
stock 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
the bye-laws require the approval of the Global Crossing 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 certain    
circumstances, Global Crossing has 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 et seq. 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 reallocation and transfer restrictions could make it difficult 
for any person or group of persons acting in concert, other than certain        
existing owners, to acquire control of Global Crossing.                         

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Distributions                                                                   

 Holders of common stock are treated equally with respect to all distributions
to shareholders of Global Crossing.                                             

Global Crossing stockholders agreement and registration rights agreement        

Global Crossing, Pacific Capital Group, GKW Unified Holdings, affiliates of 
Canadian Imperial Bank of Commerce, Continental Casualty Company, MRCo and some 
other shareholders of Global Crossing, including some of Global Crossing's      
officers and directors and their affiliates, have entered into a stockholders   
agreement and a registration rights agreement, each incorporated by reference   
as an exhibit to the registration statement of which this document is a part.   

 Under the stockholders agreement, Global Crossing has been granted a right of
first refusal on specified private transfers by these shareholders during the   
first two years after the consummation of Global Crossing's initial public      
offering on August 14, 1998. In addition, subject to the exceptions in the      
stockholders agreement, some of these shareholders have rights, which are       
referred to as "tag-along rights," permitting these shareholders to             
participate, on the same terms and conditions, in some transfers of shares by   
any other of these shareholders as follows: (1) Pacific Capital Group, GKW      
Unified Holdings and Canadian Imperial Bank of Commerce and their affiliates    
and permitted transferees have the right to participate in any transaction      
initiated by any of them to transfer 5% or more of the outstanding securities   
of Global Crossing and (2) Pacific Capital Group, GKW Unified Holdings,         
Canadian Imperial Bank of Commerce, Continental Casualty Company and MRCo and   
their affiliates and permitted transferees have the right to participate in any 
transaction initiated by any of them to transfer any securities of Global       
Crossing if that transaction would result in a change of control of Global      
Crossing.                                                                       

In addition, so long as Gary Winnick, Pacific Capital Group and GKW Unified 
Holdings and certain of their transferees collectively beneficially own, within 
the meaning of Section 13(d) of the Securities Exchange Act of 1934, at least   
15% of the outstanding shares of Global Crossing common stock, they are         
entitled to seek appraisal of the fair value of the Global Crossing common      
stock that they beneficially own and the payment of the fair value in cash in   
connection with any merger or consolidation of Global Crossing or the sale,     
lease or transfer of all or substantially all of the assets of Global Crossing, 
if they, in their capacity as shareholders of Global Crossing, did not vote in  
favor of or consent to that transaction and beneficially own the Global         
Crossing common stock as to which appraisal is sought immediately before the    
transaction.                                                                    

 Under the registration rights agreement, the Global Crossing shareholders who
are parties to that agreement and a number of their transferees have demand and 
piggyback registration rights and receive indemnification and, in some          
circumstances, expense reimbursement from Global Crossing in connection with an 
applicable registration.                                                        

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Some Differences Between Rights of Shareholders of Frontier 
and Rights of Shareholders of Global Crossing 

Upon completion of the merger, holders of Frontier common stock will become 
entitled to receive Global Crossing common stock. Global Crossing is a company  
formed under the laws of Bermuda, and Frontier is a corporation incorporated    
under the laws of New York. The Companies Act 1981 is the statute that governs  
Bermuda companies, and the New York Business Corporation Law is the statute     
that governs New York corporations.                                             

 The following is a summary of some material differences between the rights of
holders of Frontier common stock and the holders of Global Crossing common      
stock. These differences arise from differences between the corporate laws of   
the State of New York and Bermuda, as well as differences between the Frontier  
restated certificate of incorporation and the Frontier by-laws, on the one      
hand, and the Global Crossing memorandum of association and the Global Crossing 
bye-laws, on the other hand. See "Description of Global Crossing Capital        
Stock." This discussion is not a complete statement of all differences between  
rights of holders of Global Crossing common stock and Frontier common stock.    
This summary discusses material differences between the laws of Bermuda and     
those of New York. It also discusses material differences between the Global    
Crossing memorandum of association and bye-laws and the Frontier restated       
certificate of incorporation and by-laws. This summary is qualified by the full 
text of each document and the Companies Act and the New York Business           
Corporation Law. For information as to how to get those documents, see "Where   
You Can Find More Information" beginning on page 171.                           

Size and classification of the board of directors                               

Global Crossing. Bermuda law permits a company's board of directors to be   
divided into classes with staggered terms of office. The Global Crossing bye-   
laws provide for three classes of directors with staggered terms. The Global    
Crossing bye-laws mandate that Global Crossing have not less than eleven        
directors and not more than eighteen. The board of directors currently consists 
of seventeen directors. If the proposed amendments to the Global Crossing bye-  
laws are adopted, the size of the Global Crossing board of directors will be    
increased to a maximum of twenty.                                               

Frontier. The New York Business Corporation Law provides that a             
corporations's board of directors may be divided into classes with staggered    
terms of offices. Neither the Frontier restated certificate of incorporation    
nor the Frontier by-laws provide for a staggered board of directors. The        
Frontier certificate of incorporation mandates that Frontier have not less than 
nine directors. The Frontier by-laws currently provide for twelve directors.    

Removal of directors; vacancies; alternate directors                            

Global Crossing. The Global Crossing bye-laws provide that shareholders may 
in a special meeting called for that purpose remove a director, provided notice 
of the meeting is given to the director not less than 14 days before the        
meeting, and the director is entitled to be heard at the meeting. Any vacancy   
created by the removal of a director at a special meeting may be filled at the  
meeting by the election of another director or, in the absence of an election,  
by the board of directors. The Global Crossing bye-laws also provide that any   
director will be removed from office (A) upon resolution of the board, if the   
director or the director's alternate was absent from board meetings for more    
than six consecutive months without permission of the board or (B) if, after    
the initial term, that is, the term for any director commencing on August 13,   
1998, no less than three-quarters of the directors request the director to      
resign.                                                                         

Under Global Crossing's bye-laws, any director may appoint any other        
director, or any other person approved by resolution of the Global Crossing     
board of directors, to act as an alternate director to represent that director. 
A director may remove an alternate director appointed by that director.         

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Frontier. The New York Business Corporation Law provides that any or all of 
the directors of a corporation may be removed for cause by a vote of the        
shareholders and that the certificate of incorporation or by-laws may provide   
for removal without cause by a vote of the shareholders. Frontier's charter and 
by-laws do not permit removal without cause.                                    

New York law provides that vacancies occurring for any reason other than    
removal without cause may be filled by vote of the board of directors. If the   
number of directors then in office is less than a quorum, those vacancies may   
be filled by vote of a majority of the directors then in office. Under the      
Frontier by-laws, a director elected to fill a vacancy will hold office until   
the next annual meeting of the shareholders and until his or her successor has  
been elected and qualified.                                                     

Frontier directors are not permitted to appoint alternate directors.        

Meetings of shareholders                                                        

 Global Crossing. Under Bermuda law, an annual meeting must be held once every
calendar year. A special meeting of shareholders may be convened by a majority  
of the directors at any time and must be convened upon the request of           
shareholders holding not less than one-tenth of the paid up capital of the      
company carrying the right to vote at general meetings. In addition, the        
proposed amendments to the Global Crossing bye-laws, if adopted, will grant     
authority to the chairman or co-chairman of the board of directors to convene a 
special shareholder meeting at any time.                                        

Frontier. Under New York law, special meetings may be called by the board of
directors and by any other person or persons authorized to do so by the         
corporation's certificate of incorporation or by-laws. The Frontier by-laws     
provide that a special meeting may be called only by the board of directors. At 
any special meeting, only business related to the purpose or purposes stated in 
the notice to shareholders may be transacted.                                   

Action by written consent of shareholders; shareholder resolutions              

Global Crossing. Action by written consent of shareholders is permitted in  
Bermuda, except for the purpose of removing an auditor or director before the   
expiration of his or her term of office. A written resolution must be signed by 
all shareholders entitled to attend and vote at a meeting. In addition, the     
Global Crossing bye-laws provide that, unless a greater percentage is required  
by the Companies Act or by a specific bye-law provision, any matter proposed    
for consideration at any general meeting requires the affirmative vote of a     
majority of votes that may be cast by all shareholders to be approved. If the   
proposed amendments to the bye-laws are approved, ordinary shareholder          
resolutions will require the affirmative vote of a majority of the votes cast   
at a shareholders' meeting to be adopted.                                       

Frontier. The New York Business Corporation Law provides that shareholders  
may take any action without a meeting by written consent only if the consent is 
signed by the holders of all the outstanding shares entitled to vote on that    
action, unless otherwise provided in the certificate of incorporation. The      
Frontierby-laws also provide that with respect to any corporate action, other   
than the election of directors, required to be taken by a vote of the           
shareholders, the action shall, except as otherwise required by law or by the   
Frontier restated certificate of incorporation, be authorized by a majority of  
the votes cast at the applicable meeting.                                       

Vote required for extraordinary corporate transaction                           

Global Crossing. Bermuda law permits an amalgamation between two or more    
Bermuda companies or between one or more Bermuda exempted companies and one or  
more foreign corporations subject, unless the bye-laws otherwise provide, to    
obtaining a majority vote of three-fourths of the shareholders of each company  
present and voting in person or by proxy at a meeting called for that purpose   
at which the quorum shall be two persons holding more than one-third of the     
issued shares. Short form amalgamations are permitted between a holding company 
and one or more of its wholly owned subsidiary companies or between two or more 
wholly                                                                          

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owned subsidiary companies of the same holding company subject to approval of   
the amalgamation by a resolution of the directors of each amalgamating company. 
The Global Crossing bye-laws provide that an amalgamation requires the approval 
of a simple majority of votes cast at any shareholder's meeting, subject to     
specified quorum requirements.                                                  

 Frontier. The New York Business Corporation Law requires the affirmative vote
of two-thirds of all outstanding shares entitled to vote thereon to effect a    
merger, a consolidation, a share exchange or the sale, lease or disposition of  
all or substantially all of a corporation's assets. In addition, under some     
circumstances, holders of shares of a class or series of a class are entitled   
to vote together and to vote as a separate class on the transaction.            

Interested director transactions                                                

Global Crossing. The Global Crossing bye-laws provide that a director may be
a party to, or otherwise interested in, any transaction or arrangement with     
Global Crossing or in which Global Crossing is otherwise interested. So long as 
the director declares the nature of his or her interest in writing as required  
by the bye-laws and the Companies Act, he or she will not be accountable to     
Global Crossing for any benefit which he or she derives from a similar          
transaction or arrangement. For the purposes of the bye-laws, a director is     
deemed to have an interest in a transaction or arrangement with Global Crossing 
if he or she is the holder of or is beneficially interested in 5% or more of    
any class of stock of a company, or of the voting rights available to           
shareholders of a company, with which Global Crossing is proposing to enter     
into a transaction or arrangement.                                              

Frontier. The New York Business Corporation Law provides that no transaction
between a corporation and one or more of its directors or an entity in which    
one or more of its directors are directors or officers or have a financial      
interest shall be void or voidable solely for that reason. In addition, no such 
transaction shall be void or voidable solely because the director is present at 
or votes at the meeting of the board of directors or committee which authorizes 
the transaction. In order to avoid such a transaction being void or voidable,   
it must, after disclosure of material facts (unless those facts were known),    
(1) be approved by the disinterested directors or a committee of disinterested  
directors by a vote sufficient for such purpose without counting the vote of    
any interested director, or, if the vote of disinterested directors is          
insufficient to constitute an act of the board under New York law, by the       
unanimous vote of the disinterested directors or (2) be approved by a vote of   
the shareholders. Alternatively, the transaction will not be void or voidable   
if it is shown to have been fair to the corporation at the time it was approved 
by the board, a committee or the shareholders.                                  

Transfer restrictions                                                           

Global Crossing. The Global Crossing bye-laws also provide that transfers to
a shareholder that result in the shareholder beneficially owning more than a    
specified percentage of Global Crossing stock will not be registered in the     
share register of Global Crossing and shall be void and of no effect unless the 
transfer is duly approved. See "Description of Global Crossing Capital Stock--  
Voting and transfer restrictions."                                              

Frontier. There are no similar restrictions on transfers of shares under New
York law or Frontier's restated certificate of incorporation or by-laws.        

Business combination statutes                                                   

Global Crossing. The Companies Act does not contain any business combination
statute similar to the New York statue described below.                         

Frontier. Under New York law, a corporation is generally prohibited from    
engaging in specified business combinations, including specified mergers and    
consolidations, dispositions of assets and issuances of securities as well as a 
number of other transactions, with an interested shareholder, unless the        
business combination, or the purchase of stock by means of which the interested 
shareholder became an interested person, is either (1) approved by the          
corporation's board of directors in advance, (2) approved by the affirmative    
vote of the                                                                     

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holders of a majority of the outstanding voting stock not beneficially owned by 
the interested shareholder at a meeting called for that purpose no earlier than 
five years after the interested person's stock acquisition date or (3) a        
business combination that meets specified conditions. An interested shareholder 
generally includes holders of 20% or more of the outstanding voting stock of    
the corporation.                                                                

Shareholder suits                                                               

Global Crossing. The Bermuda courts would permit a shareholder to begin a   
derivative action in the name of the company to remedy a wrong done to the      
company only (1) where the act complained of is alleged to be beyond the        
corporate power of the company or illegal; (2) where the act complained of is   
alleged to constitute a fraud against the minority shareholders by those        
controlling the company; provided that the majority shareholders have used      
their controlling position to prevent the company from taking action against    
the wrongdoers; (3) where an act requires approval by a greater percentage of   
the company's shareholders than actually approved it; or (4) where there is an  
absolute necessity to waive the general rule that a shareholder may not bring   
such an action in order that there not be a violation of the company's          
memorandum of association or bye-laws.                                          

There is also a statutory remedy under Section 111 of the Companies Act,    
which provides that a shareholder may seek redress of the court as long as he   
or she can establish that the company's affairs are being conducted, or have    
been conducted, in a manner oppressive or prejudicial to the interests of some  
of the shareholders, including himself.                                         

Frontier. Under New York law, a shareholder may institute a lawsuit against 
one or more directors, either on his or her own behalf, or derivatively on      
behalf of the corporation. The New York Business Corporation Law enables a      
corporation to eliminate or limit, and the Frontier restated certificate of     
incorporation does so limit, a director's personal liability to the corporation 
or the holders of its capital stock for monetary damages for violations of the  
director's fiduciary duty to the full extent permitted under the New York       
Business Corporation Law.                                                       

Dissenters' rights                                                              

Global Crossing. Under Bermuda law a dissenting shareholder of a company    
participating in an amalgamation, other than an amalgamation between a company  
and its wholly owned subsidiary or between two or more wholly owned             
subsidiaries of the same holding company, may, in specified circumstances,      
receive cash or other consideration in the amount of the fair value of the      
shareholder's shares as determined by a court, instead of the consideration he  
or she would otherwise receive in that amalgamation.                            

Frontier. The New York Business Corporation Law grants dissenters' rights to
shareholders, which are rights to receive payment of the fair value of one's    
shares determined by judicial appraisal, in the case of specified mergers or    
consolidations, a sale of all or substantially all of the corporation's assets  
and, in the case of a shareholder whose shares would be adversely affected,     
specified amendments to the certificate of incorporation. The right to receive  
payment of the fair value is not available, however,                            

 (1) to a shareholder of the surviving corporation in a merger, unless (A)
the certificate of amendment alters or abolishes any preferential rights of 
the shares having preferences; or (B) creates, alters or abolishes any      
provision or right in respect of the redemption of the shares or any        
sinking fund for the redemption or purchase of the shares; or (C) alters or 
abolishes any preemptive right of the holder to acquire shares or other     
securities; or (D) excludes or limits the right of the holder to vote on    
any matter, except as that right may be limited by the voting rights given  
to new shares then being authorized of any existing or new class;           

(2) to a shareholder of the parent corporation in a merger between the  
parent and subsidiary corporation of which the parent owns at least 90% of  
the outstanding shares; or                                                  

(3) to a shareholder for the shares that were listed on a national      
securities exchange or designated as a national market system security by   
the National Association of Securities Dealers, Inc. on the record date for 
the related meeting.                                                        

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The New York Business Corporation Law also provides that, in determining the
fair value for payment of shares, the court consider the nature of the          
transaction and its effect on the corporation and its shareholders and the      
concepts and methods of valuation then customary in the relevant financial and  
securities markets.                                                             

Dividends                                                                       

Global Crossing. The Global Crossing bye-laws provide that the board of     
directors may from time to time declare dividends or distributions out of       
contributed surplus to be paid to the shareholders according to their rights    
and interests including any interim dividends that appear to the board of       
directors to be justified. The board of directors must be satisfied on          
reasonable grounds that at the time when the dividends are declared and at the  
time when the dividends are paid, Global Crossing is, and would after the       
payment be, able to pay its debts as they fall due and that the realizable      
value of Global Crossing's assets would not be less than the aggregate of its   
liabilities and its issued share capital and share premium accounts.            

Frontier. Under the New York Business Corporation Law, a corporation may    
declare and pay dividends on its outstanding shares except when currently the   
corporation is insolvent or would be made insolvent upon payment of the         
dividends or when the declaration, payment or distribution would be contrary to 
any restrictions contained in the certificate of incorporation. In general,     
dividends may be declared or paid out of surplus only.                          

Voting                                                                          

Global Crossing. The Global Crossing bye-laws contain restrictions on voting
shares if a holder owns more than a specified percentage of the voting power.   
See "Description of Global Crossing Capital Stock--Voting and transfer          
restrictions."                                                                  

Frontier. The Frontier restated certificate of incorporation and by-laws    
contain no similar restriction.                                                 

Preemptive rights                                                               

Global Crossing. Bermuda law does not require that preemptive rights be     
provided for in the bye-laws of the company. Preemptive rights may exist by     
contractual arrangement or pursuant to the terms of issue of the shares. The    
Global Crossing bye-laws do not contain any provision concerning preemptive     
rights, nor has Global Crossing entered into any agreement or arrangement       
granting preemptive rights.                                                     

Frontier. The New York Business Corporation Law provides, subject to        
specified exceptions, preemptive rights to shareholders upon an issuance of     
securities which would adversely affect specified interests of the              
shareholders; however, the certificate of incorporation of a corporation may    
provide otherwise. The Frontier restated certificate of incorporation states    
that no holders of shares of Frontier of any class or series, now authorized or 
authorized in the future, will have any preemptive rights.                      

Amendments to corporate governance documents                                    

Global Crossing. Amendments to the memorandum of association of a Bermuda   
company must be submitted to a general meeting of the shareholders and will be  
effective only to the extent approved by the shareholders at that meeting and,  
in respect of certain amendments to a company's objects, by the Bermuda         
Minister of Finance. The Global Crossing bye-laws provide that the bye-laws may 
be amended by resolution of the board of directors, subject to approval by      
shareholder resolution at a general meeting. In some circumstances, the vote or 
consent of the holders of 75% of the outstanding shares of capital stock of     
Global Crossing and the approval of the majority of the Global Crossing board   
of directors are required.                                                      

Frontier. Under New York law, amendments to a certificate of incorporation  
may be authorized by the vote of a majority of outstanding shares entitled to   
vote thereon. New York law also provides for approval by vote of the holders of 
a majority of outstanding shares of a particular class of stock in some         
circumstances. The                                                              

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by-laws of Frontier may be amended by a vote of the holders of the shares at    
the time entitled to vote in the election of any directors. They may also be    
amended by the board of directors of Frontier, but any by-law adopted by the    
board of directors may be amended or repealed by the shareholders entitled to   
vote in the election of any directors.                                          

Limitations on directors' liability                                             

Global Crossing. Under Bermuda law, a director must observe the statutory   
duty of care which requires the director to act honestly and in good faith with 
a view to the best interests of the company and exercise the care, diligence    
and skill that a reasonably prudent person would exercise in comparable         
circumstances. Directors are also subject to common law fiduciary duties which  
require directors to act in what they reasonably believe to be the best         
interests of the company and for a proper purpose. Bermuda law renders void any 
provision in the bye-laws or any contract between a company and any director    
exempting him or her from or indemnifying him or her against any liability in   
respect of any fraud or dishonesty of which he or she may be guilty in relation 
to the company. The Global Crossing bye-laws contain a number of provisions     
limiting the liability of directors as permitted under Bermuda law.             

The Global Crossing bye-laws provide that each shareholder agrees to waive  
any claim or right of action he or she may have, whether individually or by or  
in the right of Global Crossing, against any director of Global Crossing on     
account of any action taken by any director, or the failure of any director to  
take any action in the performance of his or her duties with or for Global      
Crossing; provided, however, that this waiver does not apply to any claims or   
rights of action arising out of the fraud or dishonesty of a director.          

Frontier. The New York Business Corporation Law permits a corporation to    
limit or eliminate a director's personal liability to the corporation or the    
holders of its capital stock for breach of duty. This limitation is generally   
unavailable for acts or omissions by a director which (1) were in bad faith,    
(2) involved intentional misconduct or a knowing violation of law, or (3)       
involved a financial profit or other advantage to which such director was not   
legally entitled. The New York Business Corporation Law also prohibits          
limitations on director liability for acts or omissions which resulted in a     
violation of a statute prohibiting specified dividend declarations, specified   
payments to shareholders after dissolution and particular types of loans.       

The Frontier restated certificate of incorporation provides for limitations 
on directors' liability as permitted by New York law.                           

Rights of inspection                                                            

Global Crossing. Bermuda law provides the public with a right of inspection 
of a Bermuda company's public documents at the office of the Registrar of       
Companies in Bermuda and provides a Bermuda company's shareholders with a right 
of inspection of the company's bye-laws, minutes of general shareholder         
meetings and audited financial statements. The register of shareholders is also 
open to inspection by shareholders free of charge and, upon payment of a small  
fee, by any other person. A Bermuda company is required to maintain its share   
register in Bermuda, but if it is a public company, it may establish a branch   
register outside Bermuda. A Bermuda company is required to keep at its          
registered office a register of its directors and officers which is open for    
inspection by members of the public without charge. Bermuda law does not,       
however, provide a general right for shareholders to inspect or obtain copies   
of any other corporate records.                                                 

Frontier. Under the New York Business Corporation Law, any person who has   
been a shareholder of record of a corporation, upon at least five days' written 
demand, has the right to examine, in person or by agent or attorney, the        
corporations minutes of the proceedings of its shareholders and a record of its 
shareholders and to make extracts from those records for any purpose reasonably 
related to the person's interest as a shareholder. Upon the written request of  
any shareholder, the corporation must give or mail to that shareholder an       
annual balance sheet and profit and loss statement for the preceding fiscal     
year, and, if any interim balance sheet or profit and loss statement has been   
distributed to its shareholders or otherwise made available to the public, the  
most recent such interim balance sheet or profit and loss statement.            

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Repurchase of untraced shares                                                   

Global Crossing. The Global Crossing bye-laws provide that Global Crossing  
will be entitled to sell at the best price reasonably obtainable, or if the     
shares are listed on a stock exchange, to purchase at the trading price as of   
the date of purchase, the shares of a shareholder or the shares that a person   
is entitled to as a result of death, bankruptcy or otherwise by operation of    
law if: (1) during a period of twelve years, at least three dividends have been 
declared and all dividends that have been sent in the manner authorized by the  
bye-laws remained uncashed; (2) after twelve years, advertisements are placed   
both in a national daily newspaper and a newspaper circulating in the area of   
the last known address of that shareholder or other person giving notice of     
Global Crossing's intention to purchase or sell the shares; (3) for three       
months after the advertisements are placed, no information regarding that       
shareholder is received; and (4) if the shares are listed on a stock exchange,  
notice is given to the stock exchange of Global Crossing's intention to sell or 
purchase those shares prior to the publication of the advertisements.           

Global Crossing will hold the proceeds of any such sale for a period of six 
years, during which period the applicable shareholder will be a creditor of     
Global Crossing and will be entitled, upon request, to payment of the proceeds  
from the sale of those shares without interest. After the six-year period ends, 
any unclaimed proceeds will become the property of Global Crossing.             

Frontier. The Frontier by-laws do not contain any provision regarding       
untraced shares.                                                                

Indemnification of Global Crossing by shareholders for some taxes and other     
impositions                                                                     

 Global Crossing. The Global Crossing bye-laws provide that if any law imposes
or purports to impose any immediate, future or possible liability on Global     
Crossing to make any payment in respect of shares held by or distributions      
payable or paid to any shareholder, then Global Crossing shall be fully         
indemnified by that shareholder or that shareholder's executor or administrator 
from that liability. In addition, Global Crossing will have a lien on all       
dividends and other money payable in respect of the shares held by that         
shareholder until the applicable liability is paid, plus interest, and may      
recover as a debt due from that shareholder or his or her administrator any     
money paid by Global Crossing as a result of that liability. Global Crossing    
may also refuse to register a transfer of any shares until such money and       
interest is repaid or set off.                                                  

Frontier. Frontier does not have similar indemnification rights under its   
corporate governance documents.                                                 

Indemnification of officers and directors                                       

Global Crossing. Under Bermuda law, a company is permitted to indemnify any 
officer or director out of the funds of the company against (1) any liability   
incurred by him or her in defending any proceedings, whether civil or criminal, 
in which judgment is given in his or her favor, or in which he or she is        
acquitted, or in connection with any application under relevant Bermuda         
legislation in which relief from liability is granted to him or her by the      
court and (2) any loss or liability resulting from negligence, default, breach  
of duty or breach of trust, save for fraud and dishonesty. The Global Crossing  
bye-laws contain provisions regarding the indemnification of officers and       
directors. The Global Crossing bye-laws generally provide for indemnification   
to the extent permitted under Bermuda law.                                      

Frontier. Under the New York Business Corporation Law, indemnification of   
directors and officers may be provided to whatever extent is authorized by a    
corporation's certificate of incorporation or a by-law or vote adopted by the   
shareholders. The New York Business Corporation Law does not permit             
indemnification with respect to any matter as to which the director or officer  
has been adjudicated not to have acted in good faith in the reasonable belief   
that the action taken was in the best interest of the corporation.              

The Frontier by-laws currently provide for indemnification of directors and 
officers and advancement of indemnified expenses to the fullest extent          
permitted under the New York Business Corporation Law.                          

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Indemnification of shareholders by Global Crossing for some taxes               

Global Crossing. The Global Crossing bye-laws provide that, if the existing 
voting and transfer restrictions in the bye-laws are amended or the board of    
directors and shareholders approve a restricted transfer of shares, Global      
Crossing will indemnify each shareholder that is treated as a "United States    
Shareholder" under Section 951 et. seq. of the Internal Revenue Code as a       
result of that amendment from and against all losses, costs, damages,           
liabilities and expenses arising out of, directly or indirectly, that           
treatment.                                                                      

Frontier. Frontier does not have similar indemnification obligations under  
its corporate governance documents because it is a United States corporation.   

Rights agreement                                                                

Global Crossing. Global Crossing has not adopted a shareholder rights plan. 

Frontier. Frontier has adopted a rights agreement, dated April 9, 1995,     
between Frontier and The First National Bank of Boston which contains           
provisions that may delay, defer or prevent a takeover of Frontier. In          
connection with the merger agreement, Frontier and Bank of Boston entered into  
an amendment to the rights agreement, which provides that the rights would not  
become exercisable as a result of the approval, execution, delivery or          
performance of the merger agreement or the stock option agreement. Immediately  
before the completion of the proposed merger, the rights under the rights       
agreement will expire.                                                          

"Anti-Greenmail"                                                                

Global Crossing. Bermuda law does not contain an anti-greenmail statute.    

Frontier. The New York Business Corporation Law provides that no domestic   
corporation may purchase more than 10% of its stock from a shareholder who has  
held the shares for less than two years at any price which is higher than the   
market price unless the transaction is approved by both the corporation's board 
of directors and a majority of the shares entitled to vote or the corporation   
offers to purchase shares from all the holders on the same terms.               

Listing                                                                         

Global Crossing. Global Crossing common stock trades on both the Nasdaq     
National Market and the Bermuda Stock Exchange.                                 

Frontier. Frontier common stock is listed on the New York Stock Exchange.   

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Proposals to Global Crossing Shareholders 
To Be Voted on at the Global Crossing Annual Meeting  

Please refer to Annex G to this joint proxy statement/prospectus for the    
complete text of each proposal to Global Crossing shareholders to be voted on   
at the Global Crossing annual meeting.                                          

Proposal No. 1: Increase in Global Crossing's authorized share capital          

On June 18, 1999, the Global Crossing board of directors unanimously adopted
a resolution approving an increase in Global Crossing's authorized share        
capital from $6,000,000 to $30,200,000 for the purpose of:                      

.  increasing the number of authorized shares of Global Crossing common     
stock, par value $0.01 per share, from 600,000,000 shares to          
3,000,000,000 shares; and                                             

.  authorizing the future issuance of 20,000,000 shares of Global Crossing  
preferred stock, par value $0.01 per share.                           

The Global Crossing board of directors is asking shareholders to approve the
resolution, which is included in Annex G to this document, at the Global        
Crossing annual meeting. The Global Crossing bye-laws require that the          
resolution be approved by a majority of the aggregate votes of all issued and   
outstanding shares of capital stock of Global Crossing.                         

The merger is conditioned on approval by Global Crossing shareholders of the
increase in the authorized share capital of Global Crossing to create shares    
of Global Crossing common stock, which will be issued in the merger to          
Frontier shareholders in exchange for shares of Frontier common stock in a      
number equal to the exchange ratio. See "The Merger--What you will receive in   
the merger." Without this amendment, Global Crossing will not have enough       
authorized shares of common stock to issue to Frontier shareholders in the      
merger. The Global Crossing board of directors has unanimously determined that  
the merger and the increase in Global Crossing's authorized share capital to    
effectuate the merger are in the best interests of Global Crossing and its      
shareholders. See "The Merger--Recommendation of the Global Crossing board of   
directors; Reasons for the merger." Shareholders who beneficially own shares    
of Global Crossing common stock representing over a majority of the voting      
power of Global Crossing have agreed to vote in favor of proposal no. 1. As a   
result, the vote of these shareholders will be sufficient to approve this       
proposal without any further vote by any other Global Crossing shareholder.     

In addition, the Global Crossing board of directors believes that it is     
desirable to have additional authorized shares of common and preferred stock    
available for possible future financing and acquisition transactions, stock     
dividends or splits, employee benefit plans and other general corporate         
purposes. Having authorized shares of common and preferred stock available for  
issuance in the future will allow Global Crossing to issue those shares         
without the expense and delay of a special shareholder meeting.                 

Common stock                                                                    

Of the 2,400,000,000 additional shares of Global Crossing common stock, if  
authorized:                                                                     

.  up to approximately 316,315,144 shares will be issued upon closing of    
the merger to Frontier shareholders in exchange for their shares of   
Frontier common stock, with each Frontier shareholder receiving that  
number of shares of Global Crossing common stock equal to the exchange
ratio. See "The Merger--What you will receive in the merger;"         

.  approximately 17,000,000 shares will be reserved for issuance under      
Frontier stock options and warrants which, in the merger, will become 
options or warrants to purchase Global Crossing common stock;         

.  56,784,270 additional shares will be reserved for issuance under the     
1998 Global Crossing Ltd. Stock Incentive Plan (the "1998 Plan"); and 

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.  approximately 2,009,900,586 shares will remain available for possible    
future financing and acquisition transactions, stock dividends or     
splits, employee benefit plans and other general corporate purposes.  

 The additional authorized but unissued shares of Global Crossing common stock
could be issued at the discretion of the Global Crossing board of directors     
without any further action by the shareholders, except as required by           
applicable law or regulation, in connection with acquisitions, efforts to raise 
additional capital for Global Crossing and other corporate purposes. The Global 
Crossing board of directors has no present plan or intention to issue any       
shares of Global Crossing common stock authorized by this proposal, other than  
in connection with the merger and the 1998 Plan.                                

 As of July 29, 1999, the total amount of authorized shares of Global Crossing
common stock was 600,000,000 shares, and 412,732,100 shares of Global Crossing  
common stock were issued and outstanding.                                       

Preferred stock                                                                 

The preferred stock, if authorized, could be issued at the discretion of the
Global Crossing board of directors without any further action by the            
shareholders, except as required by applicable law or regulation, in connection 
with acquisitions, efforts to raise additional capital for Global Crossing and  
other corporate purposes. The Global Crossing board of directors has no present 
plan or intention to issue any shares of preferred stock authorized by this     
proposal.                                                                       

This proposal would authorize the Global Crossing board of directors, from  
time to time, to divide the preferred stock into classes or series, to          
designate each class or series and to determine for each class or series its    
respective rights and preferences, including, without limitation, any of the    
following: (1) the rate of dividends and whether dividends were cumulative or   
had a preference over the common stock in right of payment; (2) the terms and   
conditions upon which shares may be redeemed and the redemption price; (3)      
sinking fund provisions for the redemption of shares; (4) the amount payable in 
respect of each share upon a voluntary or involuntary liquidation of Global     
Crossing; (5) the terms and conditions upon which shares may be converted into  
other securities of Global Crossing, including common stock; (6) limitations    
and restrictions on payment of dividends or other distributions on, or          
redemptions of, other classes of Global Crossing capital stock junior to such   
series, including the common stock; (7) conditions and restrictions on the      
creation of indebtedness or the issuance of other senior classes of capital     
stock; (8) the terms on which shares may be redeemed, if any, and (9) voting    
rights. Any series or class of preferred stock could, as determined by the      
Global Crossing board of directors at the time of issuance, rank, with respect  
to dividends, voting rights, redemption and liquidation rights, senior to the   
Global Crossing common stock. The preferred stock to be authorized is of the    
type commonly known as "blank-check" preferred stock.                           

The creation and issuance of preferred stock may constitute a variation of  
certain rights of the Global Crossing common stock. It is not possible to state 
the precise effects of the authorization of the preferred stock upon the rights 
of the holders of Global Crossing common stock until the Global Crossing board  
of directors determines the respective preferences, limitations and relative    
rights of the holders of the class as a whole or of any series or class of the  
preferred stock. These effects might include, without limitation: (1) reduction 
of the amount otherwise available for the payment of dividends on common stock  
to the extent dividends are payable on any issued preferred stock; (2)          
restrictions on dividends on the common stock; (3) rights of any series or      
class of preferred stock to vote separately or to vote with the common stock;   
(4) conversion of the preferred stock into common stock at such prices as the   
Global Crossing board of directors determines, which could include issuance at  
below fair market value or original issue price of the common stock, diluting   
the book value or per share value of the outstanding common stock; and (5) the  
holders of common stock not being entitled to share in Global Crossing's assets 
upon liquidation until satisfaction of any liquidation preference granted to    
holders of the preferred stock. Holders of Global Crossing common stock do not  
have preemptive rights to purchase shares in future issuances.                  

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Potential antitakeover effect                                                   

 This proposal may have an anti-takeover effect. The flexibility vested in the
Global Crossing board of directors to authorize the issuance of common stock    
and preferred stock in one or more classes or series could enhance the Global   
Crossing board of directors' bargaining capability on behalf of Global Crossing 
shareholders in a takeover situation and could, under certain circumstances, be 
used to render more difficult or discourage a merger, tender offer or proxy     
contest, the assumption of control by a holder of a large block of Global       
Crossing securities or the removal of incumbent management, even if such a      
transaction were favored by the holders of the requisite number of the then     
outstanding shares of capital stock. For example, the Global Crossing board of  
directors could issue preferred stock having terms that could discourage an     
acquisition attempt or other transaction that some, or a majority, of the       
shareholders might believe to be in their best interests or in which            
shareholders might receive a premium for their stock over market price.         
Accordingly, shareholders might be deprived of an opportunity to consider a     
takeover proposal which a third party might consider if Global Crossing did not 
have authorized but unissued shares of capital stock.                           

The Global Crossing board of directors recommends a vote FOR proposal no. 1 

Proposal No. 2: Issuance of shares of Global Crossing common stock in the       
merger                                                                          

On June 18, 1999, the Global Crossing board of directors unanimously adopted
a resolution approving the issuance of shares of Global Crossing common stock,  
par value $0.01 per share, in the merger, subject to completion of the merger.  
These shares will not be issued unless the merger is completed. This share      
issuance is being submitted for the approval of the shareholders of Global      
Crossing pursuant to the requirements of the National Association of Securities 
Dealers applicable to companies with securities quoted on the Nasdaq National   
Market. The NASD requirements provide that this share issuance must be approved 
by a majority of all outstanding shares of Global Crossing common stock, voting 
as a single class, at the Global Crossing annual meeting.                       

The merger cannot be completed unless Global Crossing shareholders approve  
the issuance of these shares in the merger. Shareholders who beneficially own   
shares of Global Crossing common stock representing over a majority of the      
voting power of Global Crossing have agreed to vote in favor of proposal no. 2. 
As a result, the vote of these shareholders will be sufficient to approve this  
proposal without any further vote by any other Global Crossing shareholder.     
These shares will be issued to Frontier shareholders in exchange for their      
Frontier common stock in a number per Frontier common stock share equal to the  
exchange ratio described in this document. See "The Merger--What you will       
receive in the merger" and "The Merger Agreement--Termination; Possible         
exchange ratio increase."                                                       

The Global Crossing board of directors recommends a vote FOR proposal no. 2 

Proposals Nos. 3 and 4: Amendment and restatement of Global Crossing bye-laws   

The Global Crossing board of directors has approved the amendment and       
restatement of the Global Crossing bye-laws. The existing bye-laws have not     
been amended since Global Crossing became a public company. The proposed        
amendments aim to make the Global Crossing bye-laws more suitable for a public  
company and reflect common corporate practice among United States public        
companies and public companies that, like Global Crossing, list or trade their  
equity shares on a United States securities exchange or the Nasdaq National     
Market. Accordingly, the Global Crossing board of directors is asking           
shareholders to approve these amendments, which the Global Crossing board has   
adopted by resolution included in Annex G.                                      

Proposal No. 3: Amendment and restatement of Global Crossing bye-laws (other    
than bye-laws 34(2), 63, 130 and 148)                                           

The following discussion of the proposed amendments is qualified in its     
entirety by the full text of the amended bye-laws set forth in Annex G. You     
should read Annex G carefully. Under the existing Global                        

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Crossing bye-laws, these amendments require the vote of shares of common stock  
representing at least a majority of all outstanding shares of common stock.     

Reducing the minimum shareholder voting requirements for certain corporate    
actions                                                                         

The existing bye-laws require the approval of a majority of the votes of all
outstanding shares of capital stock to:                                         

.  adopt ordinary shareholder resolutions,                                  

.  increase or decrease the authorized capital stock,                       

.  alter the capital stock, including the creation of several classes of    
stock, the increase or decrease in par value of capital stock, the    
  authorization and issuance of non-voting capital stock, the cancellation
of shares of capital stock not previously allocated and the change of 
the currency in which the capital stock is denominated,               

.  alter or abrogate the special rights of a class of shares of capital     
 stock by (1) reducing the capital paid up on those shares, (2) creating
another class of stock ranking in priority for payment of dividends or
  in respect of capital over those shares or (3) creating a class of stock
with more favorable voting rights than those shares; however, the bye-
laws require the approval of at least 75% of the votes of all         
outstanding shares of capital stock to alter or abrogate the special  
rights of a class by written consent rather than by shareholder vote, 

.  elect directors, and                                                     

.  amend the bye-laws with some exceptions that require the approval of at  
least 75% of all outstanding shares of capital stock to be amended.   

The proposed amendments reduce the minimum shareholder voting requirement to
approve the corporate actions specified above to a majority of all votes cast   
at the shareholder meeting at which these corporate actions are being voted on. 
These amendments, if adopted, will become effective only if and when the merger 
is completed.                                                                   

Manner of voting                                                              

The existing bye-laws provide that shareholders may vote at meetings either 
on a poll with one vote per share or by a show of hands with one vote per       
shareholder. The proposed amendments provide that voting by shareholders may be 
conducted only on a poll.                                                       

Notice of special meetings and shareholder director nominations               

The existing bye-laws provide that a special shareholders' meeting may be   
called by not less than 30 days' notice by the board of directors or by         
shareholders representing at least 10% of the paid in capital of Global         
Crossing. In addition, the existing bye-laws provide that notice of shareholder 
director nominations must be given to Global Crossing not less than 60 nor more 
than 90 days before the date of the annual or special shareholder meeting at    
which these nominations will be voted on.                                       

The proposed amendments provide that a special shareholders' meeting may be 
called by not less than 10 days' notice by the chairman or co-chairman of the   
board of directors, in addition to the board of directors and by shareholders   
representing at least 10% of the paid in capital of Global Crossing. In         
addition, the proposed amendments provide that notice of shareholder director   
nominations in connection with an annual shareholder meeting must be received   
by Global Crossing not less than 120 nor more than 150 days before the date of  
the release of Global Crossing's proxy statement in connection with the prior   
year's annual shareholder meeting. The proposed amendments do not provide for   
shareholder director nominations in connection with special meetings.           

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Notice period to shareholders                                                 

Under the existing bye-laws, when counting the period of any notice to      
shareholders, the date when the notice is sent, on the one hand, and the date   
when the notice is received or, if the notice relates to a shareholder meeting, 
the date of that meeting, on the other hand, are excluded from the period of    
that notice.                                                                    

 The proposed amendments expressly provide that those dates will be counted in
the period of any notice to shareholders.                                       

Number of directors and casual vacancies                                      

 The existing bye-laws provide that, at each annual meeting, shareholders will
by resolution determine the minimum and maximum number of directors on the      
Global Crossing board of directors. The bye-laws currently provide that the     
minimum number of directors is 11 and the maximum number of directors may not   
exceed 18. In addition, the existing bye-laws provide that the Global Crossing  
board of directors will have a fixed number of class A, B and C directors.      
Also, the existing bye-laws provide that the number of casual vacancies, that   
is vacancies that may be filled by the board, will be determined by shareholder 
resolution.                                                                     

The proposed amendments fix the maximum number of directors at 20 and the   
minimum number at 11, until another shareholder resolution is adopted amending  
those numbers. In addition, the proposed amendments provide that all vacancies  
on the board of directors will be casual vacancies and that the board of        
directors will have the authority to determine by resolution the number of      
class A, B, and C directors that will serve on the board from time to time.     

Staggered terms                                                               

Under the existing bye-laws, class A directors elected at the annual meeting
will serve until the annual meeting in 2002, class B directors will serve until 
the annual meeting in 2000 and class C directors will serve until the annual    
meeting in 2001. If the proposed amendments are adopted, class A directors      
elected at the annual meeting will serve until the annual meeting in 2000,      
class B directors elected at the annual meeting will serve until the annual     
meeting in 2001 and class C directors elected at the annual meeting will serve  
until the annual meeting in 2002.                                               

Outside directors' compensation                                               

The existing bye-laws provide that the compensation of Global Crossing's    
outside directors will be determined by shareholder resolution. The proposed    
amendments provide that the compensation of outside directors will be           
determined by the Global Crossing board of directors from time to time.         

Potential antitakeover effect                                                   

Some of the proposed amendments in proposal no. 3 may have an antitakeover  
effect, although this was not the intent of the Global Crossing board of        
directors in adopting these amendments. In particular, the proposed amendment   
to remove the ability of shareholders to nominate directors at special meetings 
may have the effect of delaying consideration of a shareholder director         
nomination until the next annual meeting. In addition, the proposed amendment   
granting authority to the board of directors to determine the number of class   
A, B and C directors from time to time may limit the number of director         
nominations that shareholders may make or vote on at shareholder meetings. The  
proposed amendment to the notice requirement for director nominations at annual 
meetings may have the effect of precluding a director nomination if the proper  
notice requirement has not been met.                                            

The Global Crossing board of directors recommends a vote FOR proposal no. 3 

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Proposal No. 4: Amendment and restatement of Global Crossing bye-laws 34(2),    
63, 130 and 148                                                                 

The following discussion of the proposed amendments is qualified in its     
entirety by the full text of the amended bye-laws set forth in Annex G. You     
should read Annex G carefully. Under the existing Global Crossing bye-laws,     
these amendments require the vote of shares of common stock representing at     
least 75% of all outstanding shares of common stock.                            

Record date for shareholder votes                                             

The existing bye-laws do not provide for the establishment of a record date 
for shareholders entitled to vote at shareholder meetings or by written         
resolution. As a result, under the current bye-laws, shareholders of record at  
the close of business on the date of a shareholder meeting or on the date when  
a shareholder resolution is passed by written consent are entitled to vote.     

The proposed amendments grant authority to the Global Crossing board of     
directors to establish a record date for shareholders entitled to vote at       
shareholder meetings and take action by written resolution.                     

Restrictions on transfers of shares                                           

The existing bye-laws provide that a transfer of shares to any shareholder  
that results in a shareholder that is a natural person owning 5% or more of the 
outstanding shares of common stock or in any other shareholder owning 9.5% or   
more of the outstanding shares of common stock may not be recorded in the share 
register unless that transfer is approved by a majority of the directors and by 
at least 75% of the votes of all outstanding shares of common stock. Pacific    
Capital Group, GKW Unified Holdings, Canadian Imperial Bank of Commerce,        
Continental, MRCo and their affiliates are not subject to this restriction on   
transfers.                                                                      

The proposed amendments reduce the minimum shareholder voting requirement to
approve any transfer resulting in any shareholder owning 5% or more, if the     
shareholder is a natural person, or otherwise 9.5% or more of the outstanding   
shares of common stock to a majority of the votes cast at the shareholder       
meeting called to approve that transfer. These amendments, if adopted, will     
become effective only if and when the merger is completed.                      

Limitation on voting rights                                                   

 The existing bye-laws limit the voting power of large shareholders to 9.5% of
the total voting power of the Global Crossing common stock. Any additional      
votes which these large shareholders would be entitled to cast but for this     
limitation in the bye-laws are allocated to other shareholders, pro rata based  
on their number of shares. Canadian Imperial Bank of Commerce and its           
affiliates are the only shareholders exempt from this limitation on voting      
rights. Their aggregate voting power is capped under the existing bye-laws at   
35% of the total voting power of the Global Crossing capital stock.             

The proposed amendments limit the voting power of large shareholders to 9.5%
of the total votes cast in connection with any shareholder action. In addition, 
the proposed amendments decrease the cap on the voting power of Canadian        
Imperial Bank of Commerce and its affiliates to 20% of the total votes cast in  
connection with any shareholder action. These amendments, if adopted, will      
become effective only if and when the merger is completed.                      

Correction of typographical error                                             

In existing bye-law 34(2)(ii), the reference to "maximum percentage" should 
read "Maximum Percentage." The proposed amendment makes this correction.        

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Potential Antitakeover effect                                                   

The Global Crossing board of directors does not believe that any of the     
foregoing proposed amendments to the bye-laws in proposal no. 4 have an         
antitakeover effect.                                                            

The Global Crossing board of directors recommends a vote FOR proposal no. 4 

Proposal No. 5: Election of directors                                           

The Global Crossing board of directors has made the following director          
nominations:                                                                    

.  Abbott L. Brown, Thomas J. Casey, William E. Conway and Barry Porter to  
be elected as class A directors with terms expiring in 2000. Messers. 
Brown, Casey, Conway and Porter currently serve as directors of Global
Crossing;                                                             

.  Robert Annunziata, Lodwrick M. Cook, Geoffrey J.W. Kent, David L. Lee,   
 Bruce Raben and Jack M. Scanlon to be elected as class B directors with
terms expiring in 2001. Messers. Annunziata, Cook, Kent, Lee and Raben
currently serve as directors of Global Crossing; and                  

.  Jay R. Bloom, Dean C. Kehler, Michael R. Steed, Hillel Weinberger and    
Gary Winnick to be elected as class C directors with terms expiring in
2002. Messers. Bloom, Kehler, Steed, Weinberger and Winnick currently 
serve as directors of Global Crossing.                                

In addition, the Global Crossing board of directors has made the following  
director nominations, subject to the closing of the merger and with effect      
immediately after the closing of the merger:                                    

.  James F. McDonald to be elected as class A director with a term expiring 
in 2000;                                                              

.  Eric Hippeau to be elected as class B director with a term expiring in   
2001; and                                                             

.  Joseph P. Clayton and Douglas H. McCorkindale to be elected as class C   
directors with terms expiring in 2002.                                

 Messers. Clayton, Hippeau, McCorkindale and McDonald are currently serving as
directors of Frontier.                                                          

The Global Crossing board of directors recommends the election of the nominees

Director Nominees 

Gary Winnick--Mr. Winnick, 51, founder of Global Crossing, has been Co-     
Chairman of the Global Crossing board of directors since January 1998 and,      
prior to that date, was Chairman of the Global Crossing 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, having been in the 
principal equity investment and merchant banking business since that time.      

Lodwrick M. Cook--Mr. Cook, 70, has been Co-Chairman of the Global Crossing 
board of directors since January 1998 and Vice Chairman and Managing Director   
of Pacific Capital Group since 1997. Prior to joining Pacific Capital Group,    
Mr. Cook spent 39 years at Atlantic Richfield Co., serving as President and     
Chief Executive Officer from 1985 to 1995 and as Chairman of the board of       
directors from 1986 to 1995, when he became Chairman Emeritus. Mr. Cook is also 
a member of the board of directors of Castle and Cooke, Litex and Ocean Energy, 
Inc.                                                                            

Thomas J. Casey--Mr. Casey, 46, was elected Vice Chairman of the Global     
Crossing board of directors in December 1998 and was appointed Managing         
Director of Global Crossing in September 1998. Prior to                         

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joining Global Crossing, Mr. Casey was co-head of Merrill Lynch & Co.'s Global  
Communications Investment Banking Group for three years. From 1990 to 1995, Mr. 
Casey was a partner and co-head of the telecommunications and media group of    
the law firm of Skadden, Arps, Slate, Meagher and Flom.                         

Jack M. Scanlon--Mr. Scanlon, 57, has been Vice Chairman of the Global      
Crossing board of directors since February 1999 and has been a director of      
Global Crossing since April 1998. Mr. Scanlon was Chief Executive Officer of    
Global Crossing from April 1998 to February 1999. Prior to joining Global       
Crossing, Mr. Scanlon was President and General Manager of the Cellular         
Networks and Space Sector of Motorola Inc. and had been affiliated with         
Motorola Inc. since 1990. Mr. Scanlon was Chief Operating Officer of Cambridge  
Technology Group from 1988 to 1990 and, prior thereto, spent 24 years with AT&T 
and Bell Laboratories, rising to Group Vice President at AT&T.                  

Robert Annunziata--Mr. Annunziata, 50, has been Chief Executive Officer of  
Global Crossing since February 1999 and a director of Global Crossing since     
March 1999. From September 1998 to February 1999, Mr. Annunziata was President  
of AT&T's $22 billion business services group, responsible for the AT&T global  
network. Prior thereto, Mr. Annunziata was Chairman and Chief Executive Officer 
of the Teleport Communications Group from 1983 to 1998. Prior to joining        
Teleport, Mr. Annunziata served 17 years at AT&T in a variety of increasingly   
senior operations, sales and marketing positions.                               

 David L. Lee--Mr. Lee, 49, has been President and Chief Operating Officer and
a director of Global Crossing since March 1997. He has also been a managing     
director of Pacific Capital Group since 1989. Prior to joining Pacific Capital  
Group, Mr. Lee was Group Vice President of Finance and Acquisitions at TRW      
Information Systems Group.                                                      

 Barry Porter--Mr. Porter, 41, is Senior Vice President, Corporate Development
and a director of Global Crossing. Mr. Porter has been a director of Global     
Crossing since 1997 and has also been a Managing Director of Pacific Capital    
Group since 1993. From 1986 to 1993, Mr. Porter was affiliated with Bear,       
Stearns & Co. Inc., rising to Senior Managing Director in the investment        
banking department.                                                             

Abbott L. Brown--Mr. Brown, 55, is Senior Vice President, Corporate Affairs 
and a director of Global Crossing. Mr. Brown has been a director of Global      
Crossing since 1997 and was a Managing Director and Chief Financial Officer of  
Pacific Capital Group from 1994 to 1998. From 1990 through 1994, Mr. Brown was  
Executive Vice President, Chief Financial Officer and a member of the board of  
directors of Sony Pictures Entertainment Inc., a wholly-owned subsidiary of     
Sony Corporation. Prior thereto, Mr. Brown was a partner in the international   
accounting firm of Price Waterhouse LLP.                                        

Jay R. Bloom--Mr. Bloom, 43, a director of Global Crossing since March 1997,
is a Managing Director of CIBC World Markets Corp., co-head of its High Yield   
Group and co-head of CIBC World Markets High Yield Merchant Banking Funds. Mr.  
Bloom also serves on the board of directors of Heating Oil Partners, L.P.,      
Consolidated Advisers Limited, L.L.C. and Morris Material Handling, Inc. Prior  
to joining CIBC Oppenheimer in August 1995, Mr. Bloom was a founder and         
Managing Director of The Argosy Group L.P. From 1984 to 1990, Mr. Bloom was a   
Managing Director in the Mergers and Acquisitions Group of Drexel Burnham       
Lambert Incorporated. Mr. Bloom was an investment banker associated with Lehman 
Brothers Kuhn Loeb Incorporated from 1982 to 1984 and, from 1981 to 1982,       
practiced law at Paul Weiss Rifkind Wharton & Garrison in New York.             

William E. Conway--Mr. Conway, 49, became a director of Global Crossing in  
August 1998. Mr. Conway has been a managing director of The Carlyle Group since 
1987. Mr. Conway was Senior Vice President and Chief Financial Officer of MCI   
Communications Corporation from 1984, until he jointly founded The Carlyle      
Group in August 1987. Mr. Conway serves as director to GTS Duratek, Inc.,       
Nextel Communications, Inc. and Hownet International Corporation.               

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Dean C. Kehler--Mr. Kehler, 42, a director of Global Crossing since March   
1997, is a Managing Director of CIBC World Markets Corp. and co-head of its     
High Yield Group. In addition, Mr. Kehler is a member of CIBC's Investment      
Committee and co-head of CIBC World Markets High Yield Merchant Banking Funds.  
Prior to joining CIBC World Markets Corp. in 1995, Mr. Kehler was a founder and 
managing director of The Argosy Group. From 1985 to 1990, Mr. Kehler was a      
managing director in the Mergers and Acquisitions Group, Co-Head of Merchant    
Banking and a member of the Corporate Finance Executive Committee of Drexel     
Burnham Lambert Incorporated. From 1979 to 1985, Mr. Kehler was an investment   
banker at Lehman Brothers. Mr. Kehler serves on the board of directors of Booth 
Creek Group, Inc., Telebanc Financial Corporation and Heating Oil Partners,     
L.P.                                                                            

Geoffrey J.W. Kent--Mr. Kent, 56, a director of Global Crossing since August
1998, is Chairman and Chief Executive Officer of the Abercrombie & Kent Group   
of companies and has been associated with these companies since 1967.           

Bruce Raben--Mr. Raben, 45, a director of Global Crossing since March 1997, 
is a Managing Director of CIBC World Markets Corp. Prior to joining CIBC World  
Markets Corp. in January 1996, Mr. Raben was a founder, managing director and   
co-head of the Corporate Finance Department of Jefferies & Co., Inc. since      
1990. Mr. Raben serves as a director of Optical Security, Inc., Evercom, Inc.,  
Terex Corporation and Equity Marketing, Inc.                                    

Michael R. Steed--Mr. Steed, 49, a director of Global Crossing since March  
1997, is Senior Vice President of Investments for the Union Labor Life          
Insurance Company, ULLICO Inc. and its family of companies and President of     
Trust Fund Advisors, ULLICO's investment management subsidiary. Mr. Steed       
joined ULLICO in November 1992 after serving seven years as President and       
Founder of A.F.I.C. Group, Ltd., a financial and investment consulting firm.    
From 1983 to 1985, Mr. Steed was the Executive Director of the Democratic       
National Committee. Mr. Steed serves as a director of The Lewis & Clark Snake   
River Beverage Company.                                                         

Hillel Weinberger--Mr. Weinberger, 45, a director of Global Crossing since  
June 1997, has been a Senior Vice President of Loews/CNA Holdings Corp. since   
1988. Prior thereto, Mr. Weinberger was a Senior Vice President of Presidential 
Life from 1982 to 1988.                                                         

Joseph P. Clayton--Mr. Clayton, 49, is Chief Executive Officer of Frontier  
and has held this position since March 1999. He also served as Frontier's       
President from June 1997 to March 1999 and its Chief Operating Officer from     
June 1997 to August 1997. From March 1992 until December 1996, he was Executive 
Vice President, Marketing and Sales--Americas and Asia, Thomson Consumer        
Electronics, a worldwide leader in the consumer electronics industry. He has    
been a director of Frontier since 1997.                                         

Eric Hippeau--Mr. Hippeau, 47, is Chairman and Chief Executive Officer of   
Ziff-Davis Inc., a publicly-listed company whose majority shareholder is        
Softbank, Corp. Ziff-Davis Inc. is a leading integrated media and marketing     
company focused on computing and internet-related technology. Mr. Hippeau has   
held this position since December 1993. Prior to that he held other senior      
executive positions within Ziff-Davis. He is a director of Ziff-Davis Inc.,     
Yahoo!, Inc., Herring Communications, Inc. and Starwood Hotels and Resorts      
Worldwide, Inc. He has been a director of Frontier since 1998.                  

 Douglas H. McCorkindale--Mr. McCorkindale, 60, is Vice Chairman and President
of Gannett Co., Inc., a nationwide diversified communications company, and has  
held that position since September 1997. Prior to that he held the position of  
Vice Chairman and Chief Financial and Administrative Officer. He is a director  
of Gannett Co., Inc. and Continental Airlines and a director or trustee of a    
number of investment companies in the family of Prudential Mutual Funds. He has 
been a director of Frontier since 1980.                                         

 James F. McDonald--Mr. McDonald, 59, is President and Chief Executive Officer
of Scientific-Atlanta, Inc., a leading supplier of broadband communications     
systems, satellite-based video, voice and data                                  

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communications networks and world-wide customer service and support. Mr.        
McDonald has held that position since July 1993. He is a director of            
Scientific-Atlanta, Inc., Burlington Resources, Inc. and American Business      
Products, Inc. He has been a director of Frontier since 1998.                   

Some additional executive officers of Global Crossing                           

In addition to the executive officers who are also directors and are        
described above, Global Crossing has the following executive officers:          

Dan J. Cohrs--Mr. Cohrs, 46, has been Senior Vice President and Chief       
Financial Officer of Global Crossing since May 1998. From 1993 to 1998, Mr.     
Cohrs was affiliated with GTE Corporation, rising to the position of Vice       
President and Chief Planning and Development Officer in 1997. From 1990 to      
1993, he was at Northwest Airlines and served as Vice President of              
International Finance (Tokyo, Japan); from 1986 to 1990, he was at the Marriott 
Corporation and served in such capacities as Vice President of Financial        
Planning and Acquisitions and Vice President of Project Finance; and from 1983  
to 1986, he was a Strategy and Financial Consultant at Marakon Associates.      

James C. Gorton--Mr. Gorton, 37, became Senior Vice President and General   
Counsel of Global Crossing in July 1998 and Secretary of Global Crossing in     
August 1998. From 1994 to 1998, Mr. Gorton was a partner in the New York law    
firm of Simpson Thacher & Bartlett and had been associated with the firm since  
1986. Mr. Gorton received a J.D. degree from New York University Law School.    

 Robert B. Sheh--Mr. Sheh, 59, has been Executive Vice President--Construction
& Operations since February 1999. From 1998 to 1999, Mr. Sheh was Chief         
Executive Officer of Stone & Webster Engineering Ltd. From 1992 to 1998, Mr.    
Sheh served as President and Chief Executive Officer of International           
Technology Corporation and as Chairman and Chief Executive of Air & Water       
Technologies from 1996 to 1997. From 1989 to 1992, Mr. Sheh served as President 
of The Ralph M. Parsons Company, a worldwide engineering and construction       
company. Mr. Sheh was associated with The Ralph M. Parsons Company for over 20  
years.                                                                          

Board meetings and committees                                                   

12 meetings, including regularly scheduled and special meetings, of the     
Global Crossing board of directors were held during 1998. During this period,   
Mr. Phoenix attended 66 2/3% of all meetings of the board of directors. Each    
other director attended 75% or more of all meetings of the board of directors   
and of the committees on which that director served.                            

The audit committee and the compensation committee are the standing         
committees of the Global Crossing board of directors.                           

Audit Committee                                                               

The audit committee, currently composed of directors Weinberger, Conway and 
Kent, met four times during 1998. The principal functions of the audit          
committee are to (1) make recommendations concerning the engagement of          
independent public accountants; (2) review with the Global Crossing management  
and the independent public accountants the plans for, and scope of, the audit   
procedures to be utilized and results of audits; (3) approve the professional   
services provided by the independent public accountants; (4) review the         
adequacy and effectiveness of Global Crossing's internal accounting controls;   
(5) review Global Crossing's insurance program; and (6) perform any other       
duties and functions required by any organization under which Global Crossing's 
securities may be listed.                                                       

Compensation Committee                                                        

The compensation committee, currently composed of directors Cook, Steed and 
Levine, met six times during 1998. The purpose of the compensation committee is 
to establish and submit to the Global Crossing                                  

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board of directors recommendations with respect to (1) compensation of officers 
and other key employees of Global Crossing and (2) awards to be made under the  
1998 Plan.                                                                      

Proposal No. 6: Amendment of the 1998 Global Crossing Ltd. Stock Incentive Plan 

On June 18, 1999, the Global Crossing board of directors unanimously adopted
a resolution to amend the 1998 Plan for the purpose of increasing the number of 
authorized shares of Global Crossing common stock, par value $0.01 per share,   
reserved for issuance under the 1998 Plan from 33,215,730 shares to 90,000,000  
shares. The Global Crossing board of directors is asking shareholders to        
approve the resolution, which is included in Annex G to this proxy statement.   
Below is a summary of certain important features of the 1998 Plan. This summary 
is qualified in its entirety by reference to the full text of the 1998 Plan in  
Annex H.                                                                        

Description of the 1998 Plan                                                    

The 1998 Plan is administered by the Global Crossing board of directors,    
which may delegate its duties in whole or in part to any subcommittee solely    
consisting of at least two individuals who are "non-employee" directors within  
the meaning of Rule 16b-3 under the Exchange Act and "outside directors" within 
the meaning of Section 162(m) of the Code. The 1998 Plan allows the board of    
directors to make awards of stock options, stock appreciation rights, which can 
be granted either in conjunction with, or independent of, stock options, and    
other stock based awards to any individual who is selected by the board of      
directors to participate in the 1998 Plan.                                      

The board of directors has the authority to interpret the 1998 Plan, to     
establish, amend and rescind any rules and regulations relating to the 1998     
Plan and to make any other determinations that the board of directors deems     
necessary or desirable for the administration of the 1998 Plan. The board of    
directors may also correct any defect or supply any omission or reconcile any   
inconsistency in the 1998 Plan in the manner and to the extent the board of     
directors deems necessary or desirable. Any decision of the board of directors  
in the interpretation and administration of the 1998 Plan lies within its sole  
and absolute discretion and is final, conclusive and binding on all parties     
concerned, including participants in the 1998 Plan and their beneficiaries or   
successors.                                                                     

An aggregate of 33,215,730 shares of Global Crossing common stock is        
currently authorized for issuance under the 1998 Plan. As of June 3, 1999,      
1,310,511 shares of Global Crossing common stock had been issued under the 1998 
Plan, 31,826,621 shares were subject to outstanding options granted under the   
1998 Plan and no shares were available for additional stock option grants or    
other stock-based awards.                                                       

The maximum number of shares for which awards may be granted during a       
calendar year is determined by the board of directors from time to time. No     
award may be granted under the 1998 Plan after the tenth anniversary of July 1, 
1998, but awards granted prior to that date may extend beyond that date.        

 Stock options. Stock options granted under the 1998 Plan may be non-qualified
or incentive stock options for federal income tax purposes. The board of        
directors will set option exercise prices and terms and will determine the time 
at which stock options will be exercisable. However, the term of a stock option 
may not exceed 10 years.                                                        

The board of directors may also grant stock options that are intended to be 
incentive stock options, which comply with Section 422 of the Internal Revenue  
Code. No incentive stock options may be granted to any participant who, at the  
time of the purported grant, owns more than 10% of the total combined voting    
power of all classes of capital stock of Global Crossing or any of its          
subsidiaries, unless (1) the option price for such stock option is at least     
110% of the "fair market value," as described below, of a share on the date of  
the grant and (2) the term of that stock option does not exceed the day         
preceding the fifth anniversary of the grant date. "Fair market value" is       
defined as the mean of the per share closing bid price and the per share        
closing asked                                                                   

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price on that grant date as quoted on the National Association of Securities    
Dealers Automated Quotation System.                                             

Stock appreciation rights. Stock appreciation rights may be granted by the  
board of directors to participants as a right in conjunction with the number of 
shares underlying stock options granted to participants under the 1998 Plan or  
on a stand-alone basis with respect to a number of shares for which a stock     
option has not been granted. Stock appreciation rights constitute the right to  
receive payment for each share of the stock appreciation rights exercised in    
stock or in cash equal to the excess of that share's fair market value on the   
date of exercise over the exercise price per share, multiplied by the number of 
shares covered (1) in the case of a stock appreciation right independent of an  
option, by the stock appreciation right and (2) in the case of a stock          
appreciation right granted in conjunction with an option, by the option. The    
board of directors will determine the exercise price per share of stock         
appreciation rights; however, that price may not be less than the greater of    
(1) the fair market value, in the case of a stock appreciation right            
independent of an option, of a share of common stock on the grant date and, in  
the case of an applicable stock appreciation right granted in conjunction with  
an option, of the price of that option and (2) an amount permitted by           
applicable laws, rules, by-laws or policies of regulatory authorities or stock  
exchanges. The board of directors may also impose, in its discretion,           
conditions on the exercisability or transferability of stock appreciation       
rights.                                                                         

The board of directors may also grant limited stock appreciation rights that
are exercisable upon the occurrence of special contingent events. Limited stock 
appreciation rights may provide for a different method of determining           
appreciation, may specify that payment will be made only in cash and may        
provide that any related awards are not exercisable while the limited stock     
appreciation rights are exercisable.                                            

Other stock-based awards. The board of directors has the authority to grant 
other stock-based awards, which may consist of awards of common stock,          
restricted stock and awards that are valued in whole or in part by reference    
to, or are otherwise based on the fair market value of, shares of common stock. 
Other stock-based awards may be granted on a stand-alone basis or in addition   
to any other awards granted under the 1998 Plan. The board of directors will    
determine the form of other stock-based awards and the conditions on which they 
may be de