Notice of 2011 Annual General Meeting Proxy Statement and 2010 Annual Report

John J Legere Chief Executive Officer

To Our Shareholders: Global Crossing continued to build on its momentum in 2010, making solid strides in realizing our vision to be the recognized leader in connecting businesses, people and information around the world. We demonstrated consistent progress on our strategy – and on our operational and financial performance. We invested in our global assets, and added to the depth and breadth of our product portfolio. And we improved our productivity across the business, and efficiently allocated our capital. The result: Four quarters of sequential growth in our strategic “Invest and Grow” revenue, which comprises almost 90% of our business; an improved revenue mix; higher margins; and our third consecutive year of positive Free Cash Flow. Customers around the world continued to demand greater value-added services from their suppliers in 2010, seeking to expand their own capabilities while reducing costs. Global Crossing met those expectations, and did so while delivering a superior customer experience and continuing its advance up the customer value chain. Also, in April 2011, we announced that we had entered into a definitive agreement under which Level 3 Communications, Inc. will acquire Global Crossing in a tax-free, stock-for-stock transaction, subject to certain closing conditions. The combined company will operate a unique global services platform anchored by fiberoptic networks on three continents, connected by extensive undersea facilities. We expect this transaction to close by year’s end. Even as we plan for this transformation, I remain proud of the achievements we delivered in 2010. Building Momentum in 2010 In short, our company delivered another year of growth in 2010, demonstrating that we continue to increase our momentum with a relentless focus on the four key areas that drive our business: • • • • Our customers, and doing all we can to differentiate the customer experience we deliver. Our next-generation technology, and delivering the products and services customers need to efficiently increase productivity. Our performance as a company, financially and operationally. Our people, who make it happen around the world 24 hours a day, seven days a week.

We made significant progress in each of these key areas in 2010. Our Customers We took a number of actions across our business in 2010 to ensure there was no mistaking the importance we place on enriching the experience we deliver to our customers.

First, for all of our customers, we took major steps to maintain our lead in delivering value through excellent customer service. Specifically, we announced a new initiative – our “Seven Touch Points of Customer Excellence” – to give us a methodical framework to deliver exceptional customer support and value in every aspect of our customer relationships. Second, we re-launched and expanded our uCommand customer portal, our online account management tool that gives customers access to network management and services, and enables them to directly manage many aspects of their relationship with our company. Third, we sharpened our focus on the segments we serve. We created a Federal Sector Customer-Facing Unit (CFU) to increase our service to U.S. Government customers, and recruited a seasoned executive to lead that important part of our business. We also purchased Genesis Networks, an innovator in high-performance, richmedia and video-based solutions serving the world’s major broadcasters, producers and aggregators of specialized programming. Today, Global Crossing Genesis Solutions is our newest CFU, serving customers with specialized video needs around the world. As has become customary for us, we continue to reinforce our differentiation in customer experience. In fact, our customers continued to highly rate the value we deliver. Based on results from an independent market research firm, 99% of our Carrier customers were “satisfied” with the service we delivered in 2010, up from 95% in 2009. In the Enterprise space, 99% of customers said they were “satisfied,” up from 96% in 2009. And in Collaboration Services, 99% of customers said they were “satisfied,” consistent with results in 2009. These were hard-fought results earned against some of the best competitors in our industry. As such, they are results in which the people of Global Crossing take great pride. Of course, a key metric in our business is customer loyalty, and the extent to which customers continue to buy from us and recommend us to others. The news there is good as well, as approximately 70 percent of our incremental revenue in 2010 was generated by existing customers giving us more of their business. Our rigorous focus on our customers was recognized by Telemark Services, a leading market research firm specializing in customer satisfaction research. Specifically, Telemark awarded us a Dolphin designation as a world-class network services provider in its recent Data VPN report. To earn a Dolphin designation, a provider must have high levels of customer satisfaction and a strong probability of year-over-year revenue increases resulting from winning, keeping and nurturing customers. “Global Crossing is not only markedly ahead of the market but sufficient percentage points ahead of its next nearest rival to be seen as differentiating itself on the top 10 most important customer priorities, through customer experience,” said Dr. Kerry Tomlinson, a senior analyst with Telemark Services. “Telemark’s message has always been ‘do well on what matters most to customers and do it better than competitors.’ Global Crossing has embraced that message.” In fact, we embrace it and live it every day of the year, because our customers will settle for no less. Our Next-Generation Technology, Products and Services In 2010, we continued to invest in next-generation technology, products and services, assets that contributed to our growth and momentum. Specifically, we focused on adding higher value-add, higher margin products that enable us to meet customer demands for global IP, Ethernet and data center solutions. For instance, we enhanced and expanded our global Ethernet service to offer customers more efficient performance and greater control, with end-to-end service-level guarantees.

Asia and Latin America. we continue to invest in those assets to ensure their peak performance. and support engaging interactions on their web sites. recognizing our SIP Trunking Solution for Outstanding Innovation. user guides. We earned the “Best Practices Award – North American MPLS IP VPN Competitive Strategy Leadership” from Frost & Sullivan. by adding the latest version of Limelight SITESM. And we introduced Global Crossing Connect Solutions. . a web acceleration solution from Limelight Networks® that effortlessly delivers all the static and dynamic elements that comprise a web site. and offers mobile access to sites using mobile delivery intelligence. event recordings and promotion via direct interfaces with social media sites such as Facebook ® and Twitter ®. ranking first place in the “Data Value” category. an intuitive platform that dramatically increases participant interaction. Global Crossing earned third-party validations recognizing our quality products and services: • • • • • We won an ATLANTIC-ACM Global Wholesale Excellence Award. demonstrating yet again that our ability to address our customers’ global requirements is an important differentiator for our company. enables the use of rich media to engage web site visitors. with the simple click of a button. we were selected to provide our SIP Trunking solution to support Microsoft Technology Centers throughout the United States. For instance.We also invested in a number of innovative solutions to enrich our Global Crossing Collaboration Solutions for customers. early in 2011. a family of applications that offers customers an integrated and seamless collaboration experience. We further enriched our Collaboration Services with the addition of unique social media interfaces and other enhancements to our web meeting offer with the launch of Global Crossing Web Meeting™ 11. demonstration videos. while improving both the efficiency and effectiveness of their online business. We earned the “Best Practices Award – Latin America Andean Region Growth Leadership Award for IT Infrastructure Outsourcing Services” from Frost & Sullivan. we invested in network capacity. As always. We also expanded our service reach through new points of presence or expanded interconnect partnerships to meet customer demand in Eastern Europe. upgrading our terrestrial and subsea networks and deploying 40 gigabyte technology for the first time on one of our subsea systems. As creator of the world’s first global IP-based network. customer testimonials and more – all increasing the quality of interactions with their end users. expanding our fully managed. We received INTERNET TELEPHONY® Magazine’s 2009 Product of the Year Award. Our CDN offer also is permitting enterprises to optimize their product marketing efforts by supporting detailed photographs. This means our customers can add rich media. We further improved our Content Delivery Network (CDN) product portfolio as well. our CDN offering helps accelerate the download speeds of online catalogs. • We deployed a Telepresence offer that enables customers around the world to experience life-like virtual meeting environments. • • We also announced a feature-rich unified communications experience for customers around the world. In 2010. which are used to demonstrate to enterprise customers how feature-rich unified communications services can improve their businesses. In fact. high-quality video collaboration service that efficiently connects people and their ideas. We received the 2010 “Best Business Ethernet Service” and “Best Marketing of the Year” awards for the Caribbean and Latin America region from The Metro Ethernet Forum (MEF). made possible by the fact that our portfolio of Session Initiated Protocol (SIP) Trunking solutions are qualified for Microsoft® Lync™ Server 2010. from a desktop or smartphone. from a one-page product overview to a 10-minute training video. the Middle East.

As a result. and focused the majority of our initiatives in this area on reinforcing Global Crossing’s commitment to a “performance culture. by 17%. we completed an offering of $150 million in aggregate principal amount of our 9% senior unsecured notes due 2019 in a private offering to qualified institutional buyers. We continue to invest in training and tools that support the growth of our people’s knowledge and productivity while contributing to the strong customer satisfaction scores we delivered in 2010. we deployed technology to improve our performance management tools. We also reintroduced a merit salary increase for eligible employees in 2010 after not funding such increases in 2009.We continue to take pride in all of the hard work that delivered successes in support of this goal. .S. targeting new headcount to grow our business and increase the support we provide to our customers. * A definition and reconciliation of all non-GAAP financial metrics in this letter to the most directly comparable financial measure calculated and presented in accordance with U.” Specifically. and a proliferation of IP video consumption.* We also continued in 2010 to simplify our capital structure. adoption of IP technologies and converged applications. For our people. during which employees were awarded a paid “day off” in return for making a difference in the communities in which they live and work. marked globally. We support an annual Employee Appreciation Day. Our company’s focus on serving customers. with $16 million generated in 2010. We also have invested further in our sales teams. in both the consumer and enterprise markets. We used proceeds of the offering to refinance our 5% convertible senior notes due 2011 and to pay related premium. enabling more flexibility to fund operations and make investments. Generally Accepted Accounting Principles (GAAP) can be found on the pages entitled “Definitions and Reconciliations of Non-GAAP Financial Metrics Referenced in CEO Letter” following the annual report on Form 10-K/A. We produced positive Free Cash Flow for the third consecutive year. stimulating employee engagement remains at the heart of our company. ensuring they understand our evolution as a company that is changing and improving to serve our customers even better. including continued globalization by multinational enterprises. including online objective setting and annual appraisal tools. we also invested in resources to sell into markets where these applications are growing the fastest. These actions – and additional activities supporting our people – were communicated regularly to our employees throughout the year. In short. During the year. fees and expenses. Our People We continued in 2010 to support and stimulate the engagement of our employees. We also are underscoring talent management as a critical area of focus that will ensure we have the leaders to enable our long-term success. • • • We increased “Invest & Grow” revenue by 6% in 2010. Community Day is about showing compassion and a commitment to “giving back” in ways large and small. enabled us to continue to deliver financial and operational successes in 2010. and the expertise of our people. or OIBDA.* We increased our Operating Income Before Depreciation and Amortization. we are increasingly targeting our investments and deploying our unique global assets to deliver against these demand trends – with an increasing focus on valueadded applications. Our Performance In 2010. Specifically. and extending debt maturities. and staged our second global Community Day in 2010. we experienced sustained strength in demand.

investing in our people is an important factor in the exceptional customer experience and the results we delivered in 2010. data center solutions. results upon which we are building now and into the future.Y. to ensure that the combined company hits the ground running to deliver value for shareholders like you. April 29. Inc. For instance. We will maintain our vigilance in pursuit of profitable revenue. unified communication and collaboration services. and cloud-based solutions. I look forward to outlining our 2010 results on June 14. We also have deployed a product strategy designed to move us further up the value chain – by delivering higher-value products and services. N. at our Annual General Meeting of Shareholders in New York. and our focus on using performance management as a strategic tool with our people will ensure we continue to strengthen our company. I’m pleased with the momentum we have built for our business. 2011. 2011 .As always. profitable growth. and position ourselves for long-term. Building Momentum into 2011 2010 was a year of marked progress as we continue to move our company up the value chain. we continue our efforts to design a customer experience that truly is seamless – and that remains a proven differentiator for our company. and the actions we continue to take to position our company for sustainable growth in 2011 and beyond. and strengthening our suite of managed network solutions. Thank you for your ongoing support. we intend to plan well for the closing of the business combination with Level 3 Communications. Of course.

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The Notice of the 2011 Annual General Meeting of Shareholders and related Proxy Statement accompanying this letter describe the business to be acted upon at the meeting. 2011 Dear Shareholder: The Board of Directors cordially invites you to attend the 2011 Annual General Meeting of Shareholders. Please complete. Eastern Daylight Time. on June 14. whether or not you plan to attend the meeting in person. sign and date the enclosed proxy card and return it in the accompanying prepaid envelope to ensure that your shares will be represented at the meeting. New York.m. located at 65 West 54th Street. LODEWIJK CHRISTIAAN VAN WACHEM Chairman of the Board of Directors . New York. Thank you for your continued support. The annual report for the year ended December 31.. which we will hold at 10:00 a. 2011 at the Warwick New York Hotel.April 29. 2010 is also enclosed. It is important that your shares be represented at the Annual General Meeting.

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Notice of 2011 Annual General Meeting of Shareholders We will hold the 2011 Annual General Meeting of Shareholders (the “annual meeting”) of Global Crossing Limited (“Global Crossing”) at the Warwick New York Hotel, located at 65 West 54th Street, New York, New York on June 14, 2011, at 10:00 a.m., Eastern Daylight Time, for the following purposes: To receive the report of the independent registered public accounting firm of Global Crossing and the financial statements for the year ended December 31, 2010 and to take action on the following proposals: 1. 2. 3. To elect two members of the Board of Directors; To approve the reduction of Global Crossing’s share premium account by transferring US$1.2 billion to its contributed surplus account; To appoint Ernst & Young LLP as the independent registered public accounting firm of Global Crossing for the year ending December 31, 2011 and to authorize the Audit Committee to determine their remuneration; To approve, by a non-binding advisory vote, our executive compensation; To recommend, by a non-binding advisory vote, the frequency of the advisory vote on our executive compensation; and To transact any other business that may properly come before the annual meeting and any adjournment or postponement of the meeting.

4. 5. 6.

Only common and preferred shareholders of record at the close of business on April 18, 2011, which has been fixed as the record date for notice of the annual meeting, are entitled to receive this notice and to vote at the meeting. It is important that your shares be represented at the annual meeting. Whether or not you expect to attend the meeting, please vote by completing, signing and dating the enclosed proxy card and returning it promptly in the reply envelope provided. By order of the Board of Directors,

MITCHELL C. SUSSIS Secretary, Senior Vice President & Deputy General Counsel April 29, 2011

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GLOBAL CROSSING LIMITED 2011 PROXY STATEMENT TABLE OF CONTENTS General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Directors and Executive Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Board Meetings and Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposal No. 1—Election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposal No. 2—Approval of the reduction of Global Crossing’s share premium account by transferring US$1.2 billion to its contributed surplus account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposal No. 3—Appointment of Independent Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposal No. 4—Advisory Vote on Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposal No. 5—Advisory Vote on the Frequency of the Advisory Vote on Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Potential Payments Upon Termination or Change In Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Director Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Security Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Section 16(a) Beneficial Ownership Reporting Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Submission of Future Shareholder Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Shareholder Communications with Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Delivery of Documents to Shareholders Sharing an Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Where You Can Find More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 4 13 19 20 21 23 24 25 26 39 46 49 51 51 51 52 52

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subject to any adjournments or postponements. “us” or the “Company”).10 per share. located at 65 West 54th Street (at Sixth Avenue). Date. representing approximately 59. is soliciting your proxy for use at the Annual General Meeting of Shareholders to be held on June 14. and 18. These proxy materials are being mailed to our shareholders beginning on or about April 29. Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be held on June 14. Bermuda.0% Cumulative Senior Convertible Preferred Shares (the “Senior Preferred Shares”). 2011.. New York.117. As of April 18.342. par value U. 2011 at 10:00 a.000. Our principal executive offices are located at Wessex House.S. 2011. New York. Hamilton HM12. 2010.909 common shares. subject to adjustment in certain circumstances. 45 Reid Street. The Senior Preferred Shares are convertible into common shares on a one-for-one basis. all of the Senior Preferred Shares and 29. par value U.edocumentview.com. As of April 18. 2011 (the “annual meeting”). Time and Place We will hold the annual meeting at the Warwick New York Hotel.com/glbc: • • • • our 2011 Proxy Statement.000 shares of 2.edocumentview. Votes Per Share Common and preferred shareholders of record at the close of business on April 18. You may visit us at our website located at www. $0. our Annual Report on Form 10-K/A for the fiscal year ended December 31.S. a Bermuda company (“GCL”. Who Can Vote.com/glbc The following proxy materials are available for you to review at http://www. 2011 Our Proxy Statement and Annual Report on Form 10-K/A are available at http://www.globalcrossing. on June 14. $0.PROXY STATEMENT for the ANNUAL GENERAL MEETING OF SHAREHOLDERS to be held on June 14. and any amendments to the foregoing materials that are required to be furnished to shareholders. the proxy card. 2011 GENERAL INFORMATION The Board of Directors (the “Board” or “Board of Directors”) of Global Crossing Limited.8% of the shares eligible to vote at the Annual General Meeting. we had outstanding 61. 1 . Our telephone number is 441-296-8600. “we”. 2011 are eligible to vote at the annual meeting. Eastern Daylight Time. 2011.m. 1st Floor.01 per share.431 common shares were held by a subsidiary of Singapore Technologies Telemedia Pte Ltd (“ST Telemedia”).

Eastern Daylight Time. will not affect the satisfaction of this requirement.m. broker or other holder of record. signing. dating and returning a proxy card. (1) by 2:00 a. you may either vote in person at the meeting or by proxy. we believe that nominees will generally have discretionary voting power with respect to Proposal 3 set forth below but will generally not have discretionary voting power with respect to Proposals 1. (“Computershare”). Abstentions and broker “non-votes” are counted for purposes of establishing a quorum. 2011. unless validly 2 . on an advisory basis. Shareholders of record can appoint a proxy to vote their shares in any one of the three following ways: over the internet.” if any.. Our Board’s Voting Recommendations The Board recommends that you vote your shares: • • • • • “For” each of the nominees to the Board as described in Proposal No. on June 13. or by completing. 4. Quorum and Voting Requirements The presence in person or by proxy of at least two shareholders entitled to vote and holding shares representing more than 50 percent of the votes of all outstanding common shares and Senior Preferred Shares will constitute a quorum at the annual meeting. although they will have the practical effect of reducing the number of affirmative votes required to achieve a majority by reducing the total number of shares from which the majority is calculated. will be voted as specified in the proxy. N. Eastern Daylight Time. Computershare Trust Company. A broker “non-vote” occurs when a nominee (such as a broker) holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power for that particular matter and has not received instructions from the beneficial owner. no separate class vote will take place at the 2011 annual meeting. or (2) by 5:00 pm. by telephone.Under our bye-laws and the certificate of designations for the Senior Preferred Shares. on an advisory basis. Under applicable stock exchange rules. Abstentions and broker “non-votes. you will receive instructions from the holder of record that you must follow in order for your shares to be voted. If you are the shareholder of record. 2. 5. the approval of our executive compensation as described in Proposal No. Approval of each of the proposals set out below requires the affirmative vote of at least a simple majority of the votes cast. if you are appointing a proxy to vote by returning a proxy card. each common share and each Senior Preferred Share currently entitles the holder to one vote on all matters entitled to be voted on by holders of our common shares. 4 and 5 set forth below. 2. “For”. All common shares represented by a proxy properly delivered by the shareholder of record and received by our transfer agent. “For” the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for 2011 as described in Proposal No..A. with the Senior Preferred Shares and the common shares voting together as a single class.2 billion to its contributed surplus account as described in Proposal No. 1. Although the holders of the common shares and the Senior Preferred Shares also have certain separate class voting rights under Bermuda law. 3. and “For”. 2011. “For” the reduction of Global Crossing’s share premium account by transferring US$1. on June 14. Each common share and each Senior Preferred Share will therefore be entitled to one vote on each proposal described in this proxy statement. the option of every year as the frequency of the advisory vote on our executive compensation as described in Proposal No. if you are appointing a proxy to vote over the internet or by telephone. How to Vote If your shares are held in the name of a bank.

other matters are properly brought before the annual meeting or any adjournment or postponement of the meeting. its authorization of a representative.m. Brokerage houses. 2010 Audited Financial Statements Under our bye-laws and Bermuda law. 2011. we will present at the annual meeting consolidated financial statements for the fiscal year 2010. facsimile or e-mail. Representatives of Ernst & Young LLP are expected to attend the annual meeting and to respond to appropriate questions and will have the opportunity to make a statement should they so desire.. telephone. Revocation of Proxies You may revoke your proxy or. unless waived. Directors.. but directors. As an alternative to appointing a proxy. (3) by signing and dating a new and different proxy card and mailing it to Computershare such that it is received by Computershare by 5:00 p. Proxy Solicitation We will bear the costs of soliciting proxies from the holders of our common shares. or is otherwise made available. including voting rights. which have been audited by Ernst & Young LLP. Inc. audited financial statements must be presented to shareholders at an annual general meeting of shareholders. in the case of a corporation. but may be reimbursed for out-of-pocket expenses incurred in connection with the solicitation. The Board of Directors is not currently aware of any business that will be brought before the annual meeting other than the proposals described in this proxy statement. 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.000 plus disbursements. Proxies will initially be solicited by us by mail. which must be received at our principal executive offices not later than one hour before the time fixed for the beginning of the meeting. If you return a proxy card by mail and do not specify your vote. however.m. To fulfill this requirement. June 13. June 14. nominees. 2011. We have engaged Georgeson. Computershare has agreed to assist us in connection with the tabulation of proxies. a copy of which is being delivered. discretionary authority to vote the shares represented by duly executed proxies in accordance with their discretion and judgment. (2) by submitting a new proxy via the internet or by telephone to Computershare by 2:00 a.revoked as described below. Eastern Daylight Time. unless the terms of their appointment otherwise provide. A representative so appointed may exercise the same powers. Eastern Daylight Time. a shareholder that is a corporation may appoint any person to act as its representative by delivering written evidence of that appointment. your shares will be voted as recommended by the Board of Directors. 3 . You cannot revoke your proxy merely by attending the annual meeting. If. No vote is required by shareholders with respect to our 2010 audited financial statements. or (4) by voting your shares in person or by an appointed agent or representative at the meeting. to assist us in coordinating the mailing of proxy materials at an estimated fee of $2. as the appointing corporation could exercise if it were an individual shareholder. before it is voted (1) by so notifying the Secretary of the Company in writing at the address of our principal executive offices not less than one hour before the time fixed for the beginning of the meeting. the persons appointed as proxies will have. together with this proxy statement. Those financial statements are included in our 2010 Annual Report to Shareholders (the “Annual Report”). officers and selected other employees of the Company may also solicit proxies by personal interview. executive officers and any other employees who solicit proxies will not be specially compensated for those services.

4 . the STT Shareholder Group may elect additional Directors due to its holdings of approximately 59. In addition to the STT Shareholder Group’s Director designation rights above. The experience. our bye-laws provide that for so long as the STT Shareholder Group is entitled to appoint at least two Directors.DIRECTORS AND EXECUTIVE OFFICERS Our bye-laws provide that ST Telemedia and any of its subsidiaries that are shareholders of the Company from time to time (the “STT Shareholder Group”) will be able to appoint up to eight (8) directors to our Board based upon the STT Shareholder Group’s percentage ownership of our shares at any given time. 50% of the aggregate number of common shares (calculated on an as-converted basis) acquired by the STT Shareholder Group on December 9. (ii) Chairman of the Audit Committee (to the extent permitted by applicable stock exchange rules). Specifically. 2003) 8 6 4 2 If the share ownership percentage of the STT Shareholder Group at any time falls below one of the thresholds specified above. attributes or skills that the Board believes particularly qualify each of the Directors to serve on the Board are indicated in the below biographies. The Board believes that the Directors have valuable individual skills and experiences that were derived from a broad range of occupations and industries. then the term of office of the number of Directors that the STT Shareholder Group is no longer entitled to appoint shall terminate at the following meeting of shareholders (whether annual or special). (iii) Chairman of the Compensation Committee. the STT Shareholder Group reappointed eight of the Directors in accordance with our bye-laws. all the Directors have significant experience in the oversight of public companies due to their service as directors of Global Crossing and other companies. Percentage of Fully Diluted Common Shares Number of Director Designees 50% or more Less than 50% but at least 35% Less than 35% but at least 20% At least 5% (or. qualifications. for so long as the STT Shareholder Group owns both Global Crossing common shares and Senior Preferred Shares representing in the aggregate the percentages set forth below of our outstanding common shares calculated on a fully diluted basis. holding office at any one time. The remaining two Directors were elected at the annual meeting of shareholders in 2010 and have been nominated for re-election this year. each for a term of three years (which can be renewed). providing both differing viewpoints among the Directors and familiarity with many diverse markets and subject matters. In April 2010.8% of our outstanding share capital eligible to vote at the annual meeting. The Board believes that these skills and experiences qualify each Director to serve on the Company’s Board. In addition. if less. a Director designated by the STT Shareholder Group shall serve as (i) Chairman of the Board. the STT Shareholder Group will be entitled to appoint the corresponding number of Directors indicated below to our Board. (iv) Chairman of the Executive Committee and (v) Chairman of the Nominating and Corporate Governance Committee. In addition.

. . . . He is a founding principal and the chief executive officer of Dorchester Capital Advisors (formerly East Ridge Consulting. Erkeneff . . From March 1996 to June 1998. Compensation Committee Member. . . . . Cromer . . . Macaluso has served as a Director of Global Crossing since December 2003. Federal Sector Member. . . . From 1989 to 1996. . Jr. . . . . Jr. . “Pete” Aldridge. . . . Omar A. . . . . . . . . . . . . . . . . . . . . . . . . John A. . . . . . . . Mr. . . John A. . . . . . . . . . . . and a director of The Elder-Beerman Stores Corp. . . . Enright . . . . . . . . . . . . . . Macaluso has been a director of Darling International since 2002 and its lead director since 2004. . Inc. . Executive Committee Member. . . . . Richard R. . McShane . . . . . Government Security Committee Member. . . . . Executive Committee members and executive officers. . . . . . . . Nominating and Corporate Governance Committee Director Nominees The terms of the following two Directors will expire at the annual meeting. . . John B. . . . . Macaluso was a partner at The Airlie Group. Additional biographical information concerning these individuals is provided in the text following the table. . . . . . John R. . . . . . . . 5 Director 2. . . . . . . . . Charles Macaluso . . . . . Pang . . . . Kritzmacher . . . . . . . . . Macaluso was a partner at Miller Associates. . . . . and they have been nominated for re-election by the Board of Directors for a one-year term expiring at the 2012 Annual General Meeting of Shareholders. . . . . . . a fund specializing in leveraged buyout. Anthony D. Legere . . . . . Lee Theng Kiat . . 5 Director 1. . . . . . . . . . ages and positions of our Directors. . Lazy Days. . Mulhearn. . . . . . . . Archie Clemins . . Donald L. Mr. . . . . . . . Robert A. . . . . mezzanine and equity investments. Laurinda Y. . . . . . . . . . . . . . . . . . . Charles Macaluso—Mr. . . . . . . . . . . . . . . . . . . . . . . with the committees further discussed below under the caption “Board Meetings and Committees.). . . . Klug . . 3 Director 2. . 1 2 3 4 5 79 64 72 67 75 75 58 67 58 62 60 76 52 53 48 33 57 49 51 44 43 50 49 60 41 52 Chairman of the Board of Directors 5 Vice Chairman of the Board of Directors 4 Director 1. . . . . . . . . Global Access Management Senior Vice President—Human Resources Executive Vice President and General Manager. . Carey . . . Mr. . . . . . . . . RV and Pilgrim’s 5 . . . . . . Inc. . . . . . . . Alonso . Edward Higase . . . . . . . . . . . . . . 4. . . . . 5 Member of Executive Committee Member of Executive Committee Chief Executive Officer 1 Managing Director—Latin America Managing Director—Worldwide Carrier Services Managing Director—North America Chief Marketing Officer Chief Information Officer/Chief Technology Officer Executive Vice President. . . . . . . . . . . . Neil Barua . . Peter Seah Lim Huat . . . . . . . . . . . . . . . . Lambert . . . . . . . . John J. . . . . . ... . . . . . . . . . . Sutton . . Daniel J. 4 Director 2. .C. . . . . . . . . . . a management consulting and corporate advisory firm founded in 1996. . . . . . Audit Committee Member. . . . Christie . . . . . . . . . a company principally involved in corporate workouts. . . David R. . . . . . . 3 Director 3 Director 4. . . . . Robert J. . . . Global Operations Managing Director—EMEA Chief Accounting Officer Executive Vice President and Chief Financial Officer Executive Vice President and General Counsel Executive Vice President. . . . . . . . . Steven T. Michael Rescoe . . Altaji . . . LLP. . . . . . . . . . . . . . . . . . . . . . Clontz . . 3 Director 1. . . . . . . . . . E. . . . . . The Directors’ committee assignments are also set forth below. . . . . . . He also has served as the chairman of the board of Global Power Equipment Group since 2009. . . Héctor R. . Sachs . . . . . . . 2. Jeremiah D. .” Name Age Position Lodewijk Christiaan van Wachem . . . . . . . .The following table sets forth the names. . .

He served in that capacity until 1992. respectively. During 1999 and 2000. Seah’s service as chief executive of Overseas Union Bank and ST provides him with valuable business. Rescoe was a senior investment banker with Kidder. retiring as vice chairman & chief executive officer of Overseas Union Bank in September 2001. Mr. (energy and logistics) from 1993 through 2009. a privately held company. from November 2006 until October 2009. His deep experience with multinational organizations also provides a useful international perspective to our global operations. For over a dozen years prior to that Mr. Rescoe was associated with Forstman Little. He became a director of Royal Dutch Shell Group in 1977. Mr. Macaluso’s deep experience with consulting and advisory firms gives him a unique perspective on strategic and organizational matters.V. president in 1982 and chairman of the committee of managing directors in 1985. including a deep understanding of financial statements. He also has extensive knowledge of the capital markets and years of experience in financial analysis. Seah has been chairman of Singapore Technologies Engineering Ltd since 2002. 2004 and 2010. from April 2000 until November 2002. His leadership experience with technology companies also brings a valuable perspective to the issues we face as a telecommunications company. a leveraged buyout firm. PT Indosat Tbk from 2002 to 2008. from 1997. Rescoe was chief financial officer of PG&E Corporation. leadership and management 6 . van Wachem has served as a Director of Global Crossing since December 2003. Peabody and a senior managing director of Bear Stearns specializing in strategy and structured financing. He served as executive vice president and chief financial officer of the Tennessee Valley Authority. corporate finance. Seah has served on the boards of the DBS Bank Ltd and DBS Group Holdings Ltd since 2009. Mr. He served as executive vice-president and chief financial officer of Travelport Ltd. Mr. He was also a member of the board of directors of ATCO (Canada) Ltd. since 2002 and LaSalle Foundation Limited since 2007. Lodewijk Christiaan van Wachem—Mr. Rescoe was a senior officer and the chief financial officer of 3Com Corporation. 2003 for an initial three-year term. Rescoe’s strong financial background provides financial expertise to the Board. Mr. Peter Seah Lim Huat—Mr. as well as on the board of directors of International Business Machines Corp. ST Telemedia from 2004 to 2010 and Bank of China Limited from 2006 to 2010. Mr. a position he held through July 2002. Michael Rescoe—Mr.Pride Corporation since 2001. Mr. from July 2003 until November 2006. he was a banker for the prior 33 years. accounting and capital markets. Until 2002 he also served on the supervisory boards of Akzo Nobel. Rescoe has served as a Director of Global Crossing since December 2003. Since January 2005 he has been a member of the Temasek Advisory Panel of Temasek Holdings (Private) Limited (investment company) and since November 2004 he has been a Deputy Chairman of the board of directors of STT Communications Ltd. van Wachem brings valuable management. He also has served on the boards of CapitaLand Limited since 2001. a power and natural gas energy holding company. Mr. He also served on the boards of SembCorp Industries Ltd from 1998 to 2010. In addition. corporate governance and compliance insights to his role as Chairman of the Board. Before joining ST in December 2001. (travel services). Mr. a global technology manufacturing company specializing in Internet connection technology for both voice and data applications. From December 2001 until December 2004 he was president and chief executive officer of Singapore Technologies Pte Ltd (“ST”) and also a member of its board of directors. The current three-year term expires at the 2013 Annual General Meeting of Shareholders. Through his extensive business experience in leading and serving as a board member for numerous large and complex organizations. and were subsequently reappointed to three-year terms in each of 2007 and 2010 respectively. BMW and Bayer. StarHub Ltd (“StarHub”) and STATS ChipPAC Ltd. Directors of the Company with Terms to Expire at the 2013 Annual General Meeting of Shareholders Each of the following eight Directors was originally appointed by the STT Shareholder Group as a Director on December 9. from 1993 through March 2005. Prior thereto. He was chairman of the board of directors of Zurich Financial Services from 1993 through April 2005 and was chairman of the supervisory board of Royal Philips Electronics N. Seah has served as vice chairman of the Board of Directors of Global Crossing since December 2003. a federal corporation that is the nation’s largest public power provider. when he was appointed chairman of the supervisory board of the Royal Dutch Petroleum Company.

Aldridge has served as a Director of Global Crossing since December 2003. Mr. Clemins’ active duty service included command of the attack submarine USS Pogy (SSN-647). California (the satellite. Mr. Clemins’s U. Government as a member of the Government Security Committee in accordance with the Network Security Agreement. he served as a Director of Cyalume Technology Holdings.S. Inc. His experience with technology companies gives him great familiarity with many of the types of issues that we face in our business as a telecommunications company. He is currently a consultant to the U. Technology. and Logistics. Mr. he was responsible for all matters relating to U. both in the United States and Asia. security clearance and has been approved by the U. the United States Air Force. U. security clearance and has been approved by the U. Department of Defense.C. Mr. Jr.S. As an officer of the United States Navy from 1966 through December 1999. information technology) and Alion Science and Technology Corporation (technology) since prior to 2006. Clemins is a Venture/Limited Partner with Highway 12 Ventures.S.experience. Aldridge served as chief executive officer of Aerospace Corporation from March 1992 through May 2001. since January 2000. He has been.S. From 2008 to April 2011. Pacific Fleet. Cromer—Mr. Government as a member of the Government Security Committee in accordance with the Network Security Agreement. Donald L. research and development. companies also enables him to bring a global perspective to the Board.. Government as a member of the Government Security Committee in accordance with the Network Security Agreement as described below under the caption “Board Meetings and Committees—Government Security Committee”. nonprofit and venture capital concerns. Aldridge has also held numerous other senior positions within the Department of Defense. “Pete” Aldridge. (a strategy and technology consulting firm) and the Institute for Defense Analysis. Commander. Seventh Fleet. In this position.S. His significant experience in managing and leading large and complex technology organizations also lends him insight into the issues that we face in our business. In addition to serving on the boards of other technology. Booz Allen Hamilton Inc. Mr. international programs. 7 . security clearance and has been approved by the U. including best practices gained from other countries. Mr. Lieutenant General Cromer’s military career in the Air Force spanned 32 years. missile and launch vehicle acquisition center for the Air Force). Cromer has served as a Director of Global Crossing since December 2003. he previously served on the board of Innovative Intelcom Industries since prior to 2006 until 2008. His many years of experience in banking give him important insights into our capital structure and the capital markets. Aldridge holds a U. He also has served on the boards of the Universal Space Network and Vadium.—Mr. Prior to this appointment. and the industrial base. Mr. an international consulting firm. the owner and president of Caribou Technologies. president of McDonnell Douglas Electronic Systems from December 1988 through March 1992. Mr. The insights he gained from his years of government experience also benefit us as we expand our business with governmental departments and agencies. E. Clemins has served as a Director of Global Crossing since December 2003. Mr. Aldridge’s experience in managing and leading large and complex technology-focused organizations makes him familiar with many of the issues we face as a multinational telecommunications company. He has served on the boards of Lockheed Martin Corporation (systems integrator. and concentrates on the transition and integration of commercial technology to the government sectors. and Admiral and the 28th Commander of the U. Mr. government and foreign policy issues. Inc.S. In addition. and technology transfer) since prior to 2006. Archie Clemins—Mr. Inc. Navy leadership positions give him a unique perspective on organizational management and allow him to bring to the Board insights on economic. since prior to 2006.S. Aldridge served as Under Secretary of Defense for Acquisition.S. He was the chairman of the board of trustees for the Aerospace Corporation from 2006 to 2008 and has been a member of the Corporation of Draper Laboratory. and Secretary of the Air Force from June 1986 through December 1988. Los Angeles. Seah’s experience on the board of directors of many non-U. Mr. engineering development. Mr. education. Following his retirement he joined Hughes Space and Communications Company and served as president from 1993 to 1998. advanced technology. Cromer holds a U. (a not-for-profit laboratory for applied research. Inc. Department of Defense acquisition. He retired in 1991 as the Commander of Space Division. Cromer’s many years of service in the Air Force provide him with valuable government experience that benefits us as we expand our business in the government sector. Clemins holds a U.S.S.S.S. From May 2001 until May 2003.

Mr. the principal trade association of the cable industry in the United States. Mr. Erkeneff has served as a Director of Global Crossing since December 2003. Government as a member of the Government Security Committee in accordance with the Network Security Agreement. Clontz has been Senior Executive Vice President for North America and Europe of ST Telemedia since January 2010. a Boston. for 18 years. legal and policy experience. Sachs has served as a Director of Global Crossing since December 2003. remaining with that entity for more than eight years. transportation and energy systems. Sachs brings valuable business. he previously served on the boards of Equinix. Mr.S. operations. and management. having previously held that same position from January 1998 through July 1999. He also brings a strong legal and regulatory background and deep knowledge of the cable business. Sachs—Mr. He has been president and chief executive officer of ST Telemedia since 1994 and a director of STT Communications Ltd since 1998. testing and support of advanced Tactical Unmanned Aerial Vehicles. Mr. which is an important market within the overall telecommunications industry. operating. representing cable television operators. manufacture. Robert J. Sachs served in various legal and executive capacities for Continental Cablevision. He was chief executive officer of StarHub from 1999 to 2009. He also possesses valuable financial experience as well as a deep understanding of the issues faced by technology companies.S. a lawyer by training. Executive Committee Members Steven T. Lee. Lee spearheaded the creation of ST Telemedia as a new business area for ST. Clontz—Mr. Mr. Mr.Richard R. Mr. a company focused on the design and production of defense. Inc. Erkeneff holds a U. Clontz served as chief 8 . Erkeneff has extensive experience in strategic planning. a Singapore cable television and mobile telephone company in which ST Telemedia holds a control position. Massachusetts based consulting firm serving the cable television industry. Mr. His significant leadership experience in the telecommunications industry is particularly valuable to the Company. Inc. program services. Mr. Lee Theng Kiat—Mr. Inc. since February 2005. In addition. a wholly-owned subsidiary of UIC responsible for the design. Sachs was president and chief executive officer of the National Cable & Telecommunications Association (NCTA). Lee has served as a Director of Global Crossing since December 2003. Mr. and its successor. Mr.S. since 2006. In 1993. In addition. a supplier of hardware and software technology to the cable and telephone industries. Lee also has served on the board of directors of several publicly listed companies including StarHub and TeleChoice International Limited since 1998. companies brings an international perspective that adds diversity to the deliberations of the Board. LLC. Sachs has served as a trustee of the Dana-Farber Cancer Institute since 1998 and WGBH Educational Foundational since 2005 and a director of the National Coalition for Cancer Survivorship since 2002. Sachs also has served as a director of Big Band Networks. Prior to joining AAI. training. Mr. Lee brings to the Board extensive business. Clontz has served as a member of the Executive Committee of Global Crossing since December 2003. and president of AAI from November 1993 to January 2003. He joined ST in 1985 and has held various senior ST positions including directorships in Legal and Strategic Business Development. MediaOne. In addition. from 2002 to 2005. PT Indosat Tbk from 2002 to 2008 and Global Voice Group Limited from 2000 to 2006. president and chief executive officer of United Industrial Corporation (“UIC”). Erkeneff—Mr. from November 1993 until August 2003. Erkeneff was chief executive officer of AAI Corporation (“AAI”). He has been a principal of Continental Consulting Group. Mr. From August 1999 through February 2005. Prior to co-founding Continental Consulting Group in 1998. Erkeneff held positions as senior vice president of the Aerospace Group at McDonnell Douglas Corporation. Sachs has served as a director of StarHub since 2006. Erkeneff also served as a director of UIC from October 1995 to May 2005. Mr. from October 1995 until August 2003. He was. leadership and management experience to the Board. and president and executive vice president of McDonnell Douglas Electronics Systems Company. began his career as an officer of the Singapore Legal Service. security clearance and has been approved by the U. and his leadership role at many non-U. Mr. As a former chief executive officer. and equipment and service providers. From December 1995 through December 1998. and has served as a director of StarHub since 1999. Mr. following ST’s decision to enter the telecommunications sector. Mr.

Central America. after Global Crossing’s acquisition of Impsat Fiber Networks. planning.C. Altaji joined Global Crossing in 2000 as vice president. Swaine & Moore in New York City and is a frequent lecturer and author on legal topics. Mr. Asia-Pacific for Dell from June 1998 until June 1999.. managing and overseeing all aspects of the program since its inception. Mr. Mr. Lambert. and president. Lambert has served as a member of the Executive Committee of Global Crossing since December 2003 and served the Company’s predecessor as co-chairman of the Board. and held other key positions in the Pescarmona group of companies. Mr. Alonso was managing director of Lime S. a law firm in Washington. Lambert is a nationally known lawyer whose practice has focused on corporate clients in regulated industries. a waste management company in Colombia. Mr. Alonso—Mr.L. Lambert began his legal practice at Cravath. natural gas and telecom sectors. Mr. Prior to that. Omar A.P. Clontz began his career as an engineer with Southern Bell in 1973. Mr. Mr. Prior to becoming chief financial officer in June 2002. Prior to that date. He served as president and chief executive officer of Asia Global Crossing from February 2000 until January 2002. in which capacity he was responsible for finance. Alonso served as Impsat’s chief operating officer in Latin America and the U. 9 . serving the last three years as president Asia-Pacific. Lambert served as a senior partner in Shook. chaired its audit committee and special committee on accounting matters. responsible for Latin America and Caribbean region carrier sales in Mexico. Lambert & Meyers. As managing director. As a founder and partner of the Law Offices of Jeremiah D. and infrastructure services business globally. Mr. (“Asia Global Crossing”). Inc.S. Ltd. Inc. D. Alonso served as chief financial officer of Impsat. Mr. John J. Legere was president and chief executive officer of AT&T Asia/Pacific and spent time also as head of AT&T Global Strategy and Business Development. Legere has been chief executive officer of Global Crossing since October 2001 and has served as a member of the Executive Committee of the Board since December 2003. Mr.C. when he withdrew to join the Company’s predecessor’s board of directors. Clontz worked at BellSouth International. human resources and information management systems.A. Altaji was named managing director—worldwide carrier services in May 2009. Lambert was the co-founder and chair of Peabody. and the Caribbean. Hardy & Bacon L. Prior to his tenure at Impsat. Mr. From 1997 to 1998. from September 2002 through March 2003. administration. based in New York City. He also served as a director of the Company’s predecessor from October 2001 through December 2003. and he is responsible for the overall leadership and strategic direction for the voice. he was president of worldwide outsourcing at AT&T Solutions. and president of its Colombian operations. data. Prior to the acquisition by Global Crossing. Other Executive Officers of the Company Héctor R.. Mr. he was senior vice president of Dell Computer Corporation and president for Dell’s operations in Europe. a Washington D. His responsibilities include leading the region in achieving its business goals and ensuring that Global Crossing’s operations in Latin America are closely aligned with the global organization. law firm. including those in the electricity. Jeremiah D. Alonso oversees Global Crossing’s strategy and operations across Latin America. Prior to joining Asia Global Crossing. and also served as a member of its compensation committee until December 2003. He was previously executive vice president and global head of worldwide carrier services from May 2008 until May 2009 and was also senior vice president of the Global Partner Program (GPP). From April 1994 to November 1997. president and a director of IPC Information Systems. Mr.executive officer. joining in 1987 and holding senior executive positions of increasing responsibility. Asia Global Crossing. A Global Crossing director since April 2002. Legere has two decades of experience in the telecommunications industry.C. since 1998 and Equinix since 2005. the Middle East and Africa from July 1999 until February 2000. Legere—Mr. P. Alonso has served as managing director—Latin America since May 2007. Lambert—Mr. Mr. Clontz has served as a director of InterDigital. Lambert served as chairman of the board of directors of the Company’s former subsidiary. Altaji—Mr. from December 1997 until April 2002.

customers and partners. Mr. from December 2000 through January 2002. Barua was a New York City based investment banker at Merrill Lynch in the firm’s global telecommunications group. He was most recently executive vice president. Mr. He was previously managing director. marketing and chief marketing officer for Frontier’s business lines from October 1997 through September 1999. Barua oversees Global Crossing’s profitability and growth of Global Crossing’s North America region. Carey has served as chief marketing officer of Global Crossing since January 2009. Christie was vice president. Christie was a Sloan Fellow at MIT. From September 1999 through March 2002. and senior vice president-business development from September 1999 through January 2000. From June 1997 through June 1998.. overseeing Global Crossing’s marketing organization globally. pricing. Daniel J. service delivery and customer experience reengineering. Mr. engineering. He was previously executive vice president of North America enterprise sales and collaboration services from January 2009 until May 2009. Prior to joining Global Crossing. Carey spent seven years in the energy industry. As managing director. Prior thereto. Carey—Mr. Mr. Carey began his career with AT&T. Enright—Mr. Christie was named chief information officer and chief technology officer in May 2009. During his 15 years there. respectively. based in Louisville. serving as president & chief executive officer of LG&E Natural Inc. Mr. From March 2002 through November 2003. Prior to that. enterprise sales. operations and personnel. Mr. Carey served as executive vice president. Prior to joining Global Crossing. Before Global Crossing’s acquisition of Frontier Corporation (“Frontier”) in September 1999 (the “Frontier Acquisition”). Christie has served as executive vice president from November 2003 and was chief marketing officer of Global Crossing from November 2003 through March 2007. architecture. including as a regional sales vice president from December 2005 through January 2007. and various executive positions at Louisville Gas and Electric Company. Mr. senior vice president-business and network development from January 2000 through December 2000. Christie was general manager and network vice president at AT&T Solutions from November 1999 through March 2000. Carey served as senior vice president. strategic marketing and market development. Mr. customer service and operations. Europe from April 2007 until May 2009. Christie held positions in AT&T’s International Operations Division that included an assignment as the regional managing director for the Consumer Markets Division in Asia. including development. David R. sales. having previously served as senior vice president. operations since June 2003. Mr. implementation and operation of a global technology and IT strategy in collaboration with key Global Crossing stakeholders. global product management. Barua has previously served in many capacities at Global Crossing since 2000. 10 . Mr.Neil Barua—Mr. Mr. Prior to joining Asia Global Crossing. positioning and management of products and services. Christie served as senior vice president. Prior to that. where he was responsible for overseeing all sales and marketing activities relating to our enterprise customers. certain functional units have been part of global operations including information technology. Mr. Kentucky. he was chief administrative officer of Global Crossing from January 2007 until January 2009. Over the past eight years at various points in time. he held a wide range of executive positions in marketing. business integration and strategic planning from November 2001. Enright has served as executive vice president. Mr. Global Crossing UK from March 2007 and managing director. having also held the position of Global Sales and Operations vice president in AT&T’s outsourcing division from June 1998 through November 1999. vice president conferencing from November 2003 until December 2005 and general manager of conferencing from March 2003 through October 2003. Barua was named managing director—North America in May 2009. Christie—Mr. leading the office of the chief executive officer and human resources department. From February 2002 through November 2003. including senior vice president-operations planning from January 2002 through March 2002. Mr. Mr. Enright is responsible for Global Crossing’s network planning. Mr. both subsidiaries of LG&E Energy Corp. senior vice president-network planning and development. Anthony D. Enright has also been executive champion of our company wide employee engagement initiative since 2005 and is a current member of our corporate development council and North America employee benefits committee. business development and strategic planning for Asia Global Crossing from March 2000 through October 2001. Christie is responsible for the development. In this role. Carey served in numerous capacities at Global Crossing. Mr. strategy and corporate development of Global Crossing from November 2003 until January 2009 and has been corporate ethics officer since June 2008.

Higase was corporate director and general manager from November 1999 to August 2000 of the medium-size business Corporate Accounts Division for Dell Computer Corporation in Japan. Edward T.Mr. where he had served since October 1996 as vice president for network operations and service provisioning. Kritzmacher has served as executive vice president and chief financial officer of Global Crossing since October 2008. Prior to this assignment. Mr. John B. where he led the growth of Internet-based transactions in the Asia Pacific Region. He was chief financial officer of Lucent Technologies Inc. Prior to Asia Global Crossing. outsourcing unit. and vice president—North America network and field operations from April 1999 through July 2000. including the build out of our PEC network. Klug spent eight years as an auditor with PricewaterhouseCoopers. Higase began his career with AT&T in Japan. Enright held various engineering. Enright joined Global Crossing following the Frontier Acquisition. During his nine years with that company. chief financial officer. Mr. now known as AlcatelLucent. later. McShane also serves as the chairman of the board of directors of Global Crossing (UK) Telecommunications Ltd. Lucent Planning and Business Analysis from 2000 to 2001. McShane—Mr. Higase previously served as president. he held senior roles in the Company’s finance department including vice president. AT&T Network Systems. Higase—Mr. Middle Eastern and African regions. Kritzmacher—Mr. including senior vice president and corporate controller from 2001 to 2005. finance and general manager. and business planning director from 1996 to 1997. from 2006 until the merger of Lucent Technologies with Alcatel SA. Mr. vice president. service and staff positions at Highland Telephone and Rochester Telephone. Mr. carrier services for Asia Global Crossing from August 2000 to December 2001. a designer and developer of advanced digital wireless technologies for use principally in digital cellular and IEEE 802 related products. McShane joined Global Crossing in February 1999 as our European assistant general counsel where he oversaw and managed legal affairs for the European region. Mr. including senior vice president—global network engineering and operations from March 2002 through June 2003. Mr. Higase oversees Global Crossing’s strategy and operations across the European. Mr. consumer markets division. and business management across AT&T’s business markets division. he led the network operations and service provisioning team during the deployment of Frontier’s nationwide fiber-optic network. sales.. Dell Online for Asia Pacific from August 1998 to November 1999. and the international business unit. since June 2009. 11 . He was previously executive vice president and chief customer experience officer of Global Crossing from June 2008 until May 2009. John A. Mr. He has served as a director of InterDigital. Kritzmacher began his career at AT&T Bell Laboratories and. Higase was named managing director—EMEA in May 2009. financial operations from September 2001 through June 2004. He was also previously executive vice president. Previously. vice president. cost of access finance from June 2004 through December 2005. McShane has served as executive vice president and general counsel of Global Crossing since March 2002. Klug has served as chief accounting officer of Global Crossing since December 2005. As managing director. Mr. Switching Solutions Group from 1997 to 2000. Prior to Frontier. vice president North America engineering and field operations from July 2000 through June 2001. he held a wide range of senior and executive positions in marketing. vice president—global service operations from June 2001 through March 2002. operations. He served in various other capacities during his ten-year tenure at Lucent Technologies. Mr. Prior to joining Global Crossing. subsea operations from December 1998 through December 2000 and chief accounting officer from 1997 through December 1998. vice president. Kritzmacher served as chief operating officer of the Services Business Group at Alcatel-Lucent from 2007 to September 2008. chief financial officer Americas from December 2000 through September 2001. As assistant general counsel he also had responsibility for the oversight of worldwide sales and telecommunications network outsourcing transactions for Global Crossing’s Solutions business unit and major vendor supply agreements. worldwide carrier services of Global Crossing from September 2004 to February 2008 and was executive vice president. carrier sales and marketing of Global Crossing from January 2002 to September 2004. Mr. Mr. In that role. he served as corporate director. Robert Klug—Mr. McShane oversees and manages all of our legal matters. Inc. Enright has held other positions at Global Crossing.

including positions as an associate at Simpson Thacher & Bartlett from 1987 through 1996 and as senior counsel at Shearman and Sterling. from March 2004 to January 2007 when ManTech International acquired McDonald Bradley. Legere. Pang was named senior vice president—human resources in May 2009. John R. Mulhearn has served as executive vice president. Mr. she served as the CEO’s chief of staff and vice president of operations and has held leadership roles of increasing responsibility in product management. he held positions in sales. Mr.S. He is accountable for securing agreements and managing the cost structure for all global long haul and local access (switched and special) capabilities in support of Global Crossing’s carrier and enterprise customer segments. Mulhearn was responsible for government. (partially owned by AT&T) as senior vice president of sales and marketing. She was previously vice president of customer experience re-engineering from August 2007 until May 2009 and was vice president. execution. including as vice president and general manager of its Applied Technologies Group in its GRC International unit from July 1996 to October 2002. he took an assignment in Canada to work for Unitel Communications Inc. previously serving as senior vice president. global access management since June 2005. from January 2007 to May 2010. regulatory. 12 . Wickersham & Taft. Inc. Christie and Higase were executive officers of Asia Global Crossing. sales and sales operations. Prior to joining Global Crossing. Mr. for 10 years in Department of Defense program management after five years as a ship’s officer in the U. vice president North America carrier relations from June 2001 through March 2002 and vice president operations from March 2000 through June 2001. Sutton was senior vice president of the Defense and Intelligence Business Unit in the Mission. global wholesale voice and access management from October 2004 through December 2006. marketing. Previously he served as senior vice president of global access management from May 2002 until September 2004. Laurinda Y. Mulhearn. operations. Cyber and Technology Group of ManTech International. Mr. Inc.—Mr. when it filed for bankruptcy protection in June 2002. McShane spent twelve years at several international law firms. Jr. Sutton has served as executive vice president and general manager. federal sector since June 2010.Prior to joining Global Crossing. Inc. outsourcing and human resources. he led the strategic planning. Prior to joining McDonald Bradley. Mr. Sutton is responsible for focusing the global resources of Global Crossing to better serve government customers. Sutton—Mr. Mr. Earlier in his career. prior to joining the Company. which filed for bankruptcy protection in November 2002. national and regional commercial accounts. Mr. growth and diversification program for a varied portfolio of customers across defense and intelligence agencies. Mr. Pang—Ms. global access management from March 2002 until May 2002. Mulhearn previously worked for 28 years at AT&T. as well as for network infrastructure requirements. Sutton was vice president of uniformed services at Integic Corporation from November 2002 to February 2004. She is responsible for the leadership of all aspects of the human resources program. vice president. In 1993. In that role. Merchant Marine. Sutton served with PRC Inc. Sutton was senior vice president of advanced programs at McDonald Bradley. Mr. commercial and financing activities. and Brown & Wood. During his tenure at AT&T. where his main focus was on representing major commercial banks. John A. Legere was chief executive officer the Company’s predecessor when it filed for bankruptcy protection in January 2002. In addition. In that position. He also served six years with AT&T Government Solutions. investor relations from September 2004 to August 2007. financial institutions and corporations in connection with a broad range of their corporate. As noted above. Alonso was chief financial officer of Impsat Fiber Networks. Mr. Cadwalader. Prior to joining Global Crossing. Messrs.

the Audit Committee oversees: (A) management’s conduct of the Company’s financial reporting process. The Board has determined that Mr. we expect and require all of our Directors to attend our annual meeting of shareholders. the Executive Committee and the Government Security Committee. As a general matter. (D) the performance of the Company’s internal audit function and management’s establishment and application of the 13 . 45 Reid Street. Hamilton HM12. 1st Floor. Compensation Committee. Rescoe. Aldridge.globalcrossing. Rescoe. is an “audit committee financial expert” as defined in applicable Securities and Exchange Commission (the “Commission”) rules. Nine of our Directors attended our 2010 annual shareholder meeting. Audit Committee The Audit Committee consists of Messrs. Each individual who was a Director during 2010 attended seventy-five percent (75%) or more of the aggregate meetings of the Board and of the committees of the Board on which he served. The Board held eleven meetings. or can be mailed to shareholders upon written request to our Secretary at Wessex House. the committee’s chairman. with one telephonic and five “in-person” meetings. can be found on our website at www. and change the composition of our committees to ensure compliance with these NASDAQ requirements. (B) the Company’s compliance with legal and regulatory requirements that may have a material impact on the Company’s financial statements. Rescoe (chairman). all of which were “in-person” meetings. In light of the STT Shareholder Group’s majority ownership of the voting power for the election of directors as set forth in this proxy statement under the caption “Security Ownership—Certain Beneficial Owners. qualifications (including independence).com. and the Board has determined that each of our Audit Committee members (Messrs.” we are a “controlled company” as defined in the NASDAQ rules. if necessary. except for Mr. Director Independence. together with the charters of our Audit Committee. with four telephonic and five “in-person” meetings. We adopted an ethics policy that applies to all of our Directors. compensation and performance of the Company’s independent registered public accounting firm and the quality of the annual independent audit of the Company’s financial statements. Aldridge. The Nominating and Corporate Governance Committee held one “in-person meeting” and the Executive Committee did not meet in 2010. we will amend our bye-laws and committee charters. The primary purpose of the Audit Committee is to assist the Board in fulfilling its responsibility for the integrity of the Company’s financial reports. such waiver will be posted on our website within five days of that waiver being granted.BOARD MEETINGS AND COMMITTEES The Board and its various Committees met numerous times during 2010. The Government Security Committee met five times. the Compensation Committee. or to other users of such information. (C) the appointment. Bermuda. At such time as we are no longer a “controlled company. including the integrity of the financial statements and other financial information provided by the Company to governmental and regulatory bodies. Nominating and Corporate Governance Committee. Executive Committee and Government Security Committee. If a waiver of our ethics policy is granted to any of our Directors or executive officers. each of our committees has a charter. Erkeneff and Macaluso) satisfies the independence requirements of the NASDAQ rules. all of whom satisfy the independence and other qualification requirements of the NASDAQ rules. Erkeneff and Macaluso.” The Audit Committee met nine times. to shareholders and other security holders. Aldridge. six of which were telephonic and five of which were “in-person. we are not required to comply with NASDAQ rules that require listed companies to have a majority of independent directors or nominating and compensation committees composed entirely of independent directors or to have written charters for certain committees addressing specified matters. The Compensation Committee met six times. To carry out this purpose. The five standing committees of the Board are the Audit Committee. officers (including the CEO and the CFO) and employees. These committees are described in the following paragraphs. The policy.” if ever. the Nominating and Corporate Governance Committee. As mentioned above. As such. who attended seventy-two percent (72%) of such meetings.

and such other matters as are incidental thereto. . . . . subject to the rights of the shareholders under Bermuda law to appoint the auditors at the annual meeting. . . .000 Pursuant to paragraph (c)(7)(i)(B) of Rule 2-01 of Commission Regulation S-X. . . . 2010 and 2009 by our present principal independent registered public accounting firm. . . . . . . . . THE AUDIT COMMITTEE Michael Rescoe.000 $5. . . . . Chairman E. . . . . . . for filing with the Commission. .000 $5. The Audit Committee also carries out other functions from time to time as assigned to it by the Board. . . Audit Related Fees . the independent registered public accounting firm. . . .000 $5. . . 2010. Richard R. . . . . the goal of the Audit Committee is to serve as an independent and objective monitor of the Company’s financial reporting process and internal control systems. . The Audit Committee also selected Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31. . . . . . . . .474. 2011. . .000 173. internal audit operations and financial and executive management. . and to provide an open avenue of communication with the Board for.991. . Erkeneff Charles Macaluso Principal Accounting Firm Fees The following table sets forth the fees billed to the Company for the fiscal years ended December 31. . . . .820. .362. and the Board of Directors approved. .000 343. . . . . 14 . . . . .C. . . In carrying out its purpose. . . . . . . . . . . . . . . . Total . . . . . .000 140. . . . . . the Audit Committee has adopted a pre-approval policy pursuant to which the committee delegated to its chairman the authority to approve in advance audit or non-audit services to be performed by the Company’s independent registered public accounting firm. . Jr. . . . . . and (E) the adequacy of and adherence to (including any waivers granted to executive officers from adherence to) the Company’s code of business conduct and ethics. . . . . . . . . . . . the Audit Committee (1) reviewed and discussed the audited financial statements with management. . . . and (3) received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Company Accounting Oversight Board regarding such firm’s communications with the Audit Committee concerning independence. . . . . . . . . . . . . The chairman and management are required to report any such pre-approval decision to the Audit Committee at its next scheduled meeting. . . . Report of the Audit Committee Management is responsible for the preparation of the Company’s financial statements and the independent registered public accounting firm is responsible for examining those statements. . . $4. . . “Pete” Aldridge. . . . Tax Fees . . . and among. . . . including the activities of the Company’s independent registered public accounting firm and internal audit function. . Ernst & Young LLP: 2010 2009 Audit Fees . . . 2010 financial statements. . that the Company’s audited consolidated financial statements be included in the annual report on Form 10-K for the fiscal year ended December 31. . .000 285. . . . . . and has discussed with the independent registered public accounting firm the firm’s independence. including Statement on Auditing Standards No. 61 (as the same may be amended or supplemented). . . . Based upon these reviews and discussions. In connection with the preparation of the December 31. . . (2) discussed with the independent registered public accounting firm the matters required to be discussed under generally accepted auditing standards. .Company’s systems of internal accounting and financial controls and disclosure controls. . . . . the Audit Committee recommended.

targets. Based on an evaluation of the key employees’ performance against those corporate goals and objectives. including determining performance measures and goals.Compensation Committee The Compensation Committee consists of Messrs. Lee and Sachs. setting thresholds. 15 . unless the issues addressed by such subcommittee in no respect address or affect the obligations of the Company under the Network Security Agreement (as described below). Seah (chairman). on the Company’s risk profile. The primary purpose of the Compensation Committee is to discharge certain responsibilities of the Board related to the compensation of the Company’s “key employees” (as defined by the committee) and related matters. and maximum awards. • • • • • The Compensation Committee may form and delegate any of its responsibilities to a subcommittee so long as such subcommittee is solely comprised of members of the Compensation Committee (provided that responsibilities in respect of the administration of the Company’s employee benefit plans may be delegated to a subcommittee including or consisting of management personnel) and includes a member who is also a member of the Government Security Committee. and certifying goal attainment and approving incentive payments. subject to concurrence by the Board. The Compensation Committee has sole authority to retain or terminate the outside advisor to assist with compensation matters. as amended (“Performance-Based Executive Compensation”). (i) approves the compensation level for each key employee other than the CEO and the EVPs and (ii) recommends to the Board the compensation level for the CEO and the EVPs. the outside compensation advisor of the Compensation Committee. The CEO works with the Human Resources Department and Meridian Compensation Partners LLC (formerly part of Hewitt Associates. “Meridian”). provided that the Compensation Committee itself approves goals and objectives for awards intended to qualify for an exemption under Section 162(m) of the Internal Revenue Code of 1986. Reviews the key employee compensation programs and equity-based compensation plans to determine whether they are properly coordinated and achieving their intended purposes and makes or recommends any appropriate modifications. Annually reviews peer company market data to assess the Company’s competitive position for each significant component of key employee compensation. Clemins. Management assists the Compensation Committee in their oversight of the compensation of the key employees. Considers the impact of the Company’s executive compensation program. In fulfilling this purpose. We review annually the overall compensation philosophy and policies for executive officers. in which case such subcommittee need not include a member who is also a member of the Government Security Committee. Administers awards and compensation programs and plans intended to qualify as Performance-Based Executive Compensation. reviewing performance compared to goals. and the incentives created by the compensation awards that it administers. to make recommendations on each key employee’s compensation (excluding his own). Grants awards of shares or share options pursuant to the Company’s equity-based plans. the Compensation Committee performs the following functions: • • • Establishes the overall compensation philosophy and policies of the Company. provided that the Compensation Committee itself determines all Performance-Based Executive Compensation. and recommends those goals and objectives for approval by the Board with respect to the CEO and the EVPs. The Compensation Committee’s instructions to Meridian included the following: • Provide competitive market data as a reference for the Committee to consider executive compensation actions. including the establishment of new such programs. Approves corporate goals and objectives relevant to compensation for all key employees other than the CEO and the executive vice presidents (“EVPs”).

the Compensation Committee considers the impact of the Company’s executive compensation program. We believe that our compensation program makes a balanced use of short-term cash compensation with long-term. a Singapore cable television and mobile telephone company in which ST Telemedia holds a control position. We believe that these vesting requirements encourage our executives and other participants in our long-term incentive program to maintain a long-term perspective and avoid short-term actions that are to our long-term detriment. share-based compensation that is intended to correlate with increases in long-term shareholder value. Lee is president and chief executive officer of ST Telemedia. Mr. provided comment on considered compensation actions. Sachs is a director of StarHub. Seah. 16 . we have concluded that our compensation policies and procedures are not reasonably likely to have a material adverse effect on the Company. Although each non-sales employee is eligible to receive a cash bonus under our annual incentive program. as the Compensation Committee deems appropriate. Long-term incentive grants are made at a meeting that is scheduled well in advance as part of the Compensation Committee’s annual calendar.• • • Advise the Compensation Committee on executive compensation matters that align with long-term business strategies and shareholder interests. on the Company’s risk profile. including the incentives that they create and factors that may reduce the likelihood of excessive risk taking. See “Certain Relationships and Related Transactions—Commercial Relationships Between the Company and ST Telemedia” for a description of certain relationships between the Company and ST Telemedia. and Attend Compensation Committee meetings as scheduled throughout the year. In addition. Risks Related to Compensation Policies As part of its oversight of the Company’s executive compensation program. Meridian participated in all scheduled Compensation Committee meetings. and the incentives created by the compensation awards that it administers. Mr. and assisted in the design of various program enhancements. Apprise the Compensation Committee of trends and best practices associated with executive compensation. which is comprised entirely of non-management directors. a wholly owned subsidiary of ST Telemedia. Compensation Committee Interlocks and Insider Participation Messrs. ST Telemedia and STT Communications Ltd are all indirect parent entities of the Company. Temasek Holdings. Clemins. This discretion gives these bodies an opportunity to avoid rewarding inappropriate behavior or excessive risk-taking after taking into account the overall context of our results during the year and our financial position at the time of payout. In 2010. The Compensation Committee. provided reports on competitive market compensation information. None of these individuals had any relationships with the Company requiring disclosure under Commission rules. Seah is a member of the Temasek Advisory Panel of Temasek Holdings (Private) Limited and a member of the board of directors of STT Communications Ltd. the Compensation Committee and Board retain significant discretion regarding the payment of a bonus under the program. After reviewing the recommendations made to the Compensation Committee and consulting with the outside advisor. the Committee makes its final recommendations to the Board regarding compensation of all executive vice presidents and the CEO. Based on our review of our compensation policies and procedures. Mr. seeks to avoid compensation arrangements that could encourage inappropriate or excessive risk taking. Lee and Sachs serve on the Compensation Committee of the Board of Directors. the approximately three-year vesting schedule for our RSUs serves as an incentive for our Named Executive Officers and other recipients of these awards to remain with us and to focus their efforts on all elements of our performance that influence longterm common share price appreciation.

which include transmission and routing equipment. the Federal Bureau of Investigation. The Nominating Committee may consider all factors it deems relevant. respectively. if any. subject to such limitations as the Board and/or applicable law may from time to time impose.globalcrossing. including sound judgment.S. The Government Security Committee discharges those responsibilities related to the security of the Company’s domestic United States operations as are required of the Government Security Committee or its individual members pursuant to the terms of the Network Security Agreement. Our corporate governance guidelines can be found on our website at www. and Macaluso. Aldridge. as amended by Amendment 1 to the Network Security Agreement. Bermuda. with the objective of assembling a group that can best drive the success of the business and represent shareholder interests. Lee (chairman). the Nominating Committee reviews each current member of the Board and determines or recommends to the full Board.Nominating and Corporate Governance Committee The Nominating and Corporate Governance Committee (the “Nominating Committee”) consists of Messrs. 2003. dated as of February 1. ST Telemedia. whether such directorships are filled by the Board or the shareholders. Lambert. the Department of Defense.S. the United States Department of Justice. 1st Floor. Aldridge (chairman). retained by the Company to identify and recruit new members of the Board. Executive Committee The Executive Committee consists of Messrs. van Wachem (chairman). security clearances pursuant to Executive Order 12968 immediately upon their appointment to the Government Security Committee. Cromer. and the Department of Homeland Security. experience. The Committee is comprised solely of Directors who are U. The Committee’s evaluation of Director nominees takes into account their ability to contribute to the diversity of background. compensation and oversight of search firms and recruitment consultants. Clontz. the Committee may meet to review and discuss the strategic direction of and major developments at the Company. 17 . technical skills. Legere. The Nominating Committee assists the Board in fulfilling its responsibility to the shareholders by (i) identifying individuals qualified to serve as directors and recommending that the Board support the selection of the nominees for all directorships. establishes processes and procedures to ensure the security of our U. and may advise and make recommendations to management and the Board relating to such matters. dated as of September 24. diversity and the extent to which the candidate would fill a present need on the Board. switches and associated operational support systems and personnel (referred to in the Network Security Agreement as the “Domestic Communications Infrastructure”). (ii) developing and recommending to the Board a set of corporate governance guidelines and principles and (iii) reviewing. must apply for U. Government Security Committee The Government Security Committee consists of Messrs. Hamilton HM12. Clemins and Erkeneff. security clearances.S. Subject to the designation rights in the Company’s bye-laws. business specialization. a copy of which is included as an exhibit to our 2002 annual report on Form 10-K and our 2007 annual report on Form 10-K. on a periodic basis. The Nominating Committee has the direct responsibility for the appointment. Cromer. The Network Security Agreement and Amendment 1 thereto. it believes that diversity is an important factor in determining the composition of the Board. Although the Nominating and Corporate Governance Committee does not have a formal diversity policy. citizens who. the “Network Security Agreement”). whether such director should stand for re-election. among the Company. The Nominating Committee establishes the standards and process for the selection of individuals to serve on the Board consistent with the terms of the Network Security Agreement (as described below) and the Company’s bye-laws. In addition. if not already in possession of U.com or can be mailed to shareholders upon written request to our Secretary at Wessex House. termination. skills and perspectives represented on the Board. the overall corporate governance of the Company and recommending improvements when necessary. 45 Reid Street. Lee and Sachs.S. The Executive Committee has the power to exercise all the powers of the Board when exigencies or practical considerations prevent the convening of the full Board in a timely manner. network assets. 2007 (as amended.

overseeing management’s conduct of the Company’s financial reporting process. In addition. and the annual audit plan that is approved by the Audit Committee. As part of its oversight of the Company’s executive compensation program. The Board believes that shareholders are best served by separating the roles of the Chairman of the Board and the chief executive officer. our management is responsible for the day-to-day risk management processes. including. and the performance of the Company’s internal audit function and management’s establishment and application of the Company’s systems of internal accounting and financial controls and disclosure controls. 18 . as is required of the Government Security Committee or its individual members pursuant to the terms of the Network Security Agreement. the Company’s compliance with legal and regulatory requirements that may have a material impact on the Company’s financial statements. The Government Security Committee overseas the management of the risks related to the security of the Company’s domestic U. among others. has day-to-day responsibility for the management of risks that arise in their respective areas of responsibility. finance and operations. the Compensation Committee overseas the management of the risks associated with the Company’s compensation programs. The Board believes that this allows the chief executive officer of the Company to focus his time and effort on effectively running the Company and leading his management team while the Chairman can focus on leading the Directors in providing independent oversight of management goals and performance. operations. our Internal Audit department performs annual risk assessments to define the scope of the evaluation of the effectiveness of our internal control over financial reporting. as required by the Sarbanes-Oxley Act of 2004. Each functional area within the Company. Under its charter. except in unusual circumstances. tax. legal. among other things. Management reports to the Board and the Audit Committee on a regular basis regarding any material risks and the proposed response to managing those risks.S. the Audit Committee is charged with the responsibility to oversee and review certain aspects of the management of our major financial risk exposures. including. See the section entitled “Risks Related to Compensation Policies” on page 16.Board Leadership Structure It is the policy of the Board that the position of Chairman of the Board not be held by a member of Company management. Board Role in Risk Oversight Our Board has the overall responsibility of overseeing the risk management efforts of the Company as carried out by our management. While the Board and its committees oversee the Company’s overall risk management.

5 million of co-location services from affiliates of ST Telemedia. For further details. such transactions where the amount involved $120. As required under Commission rules. Further. are directors and officers of certain entities within the STT Shareholder Group. we provided approximately $1. Seah.9 million of capital equipment from an affiliate of ST Telemedia. In addition. who are members of our Board of Directors. Commercial and other relationships between the Company and ST Telemedia During this past year. and Mr.0 million of telecommunications services to subsidiaries and affiliates of ST Telemedia. the Audit Committee reviews and approves or ratifies any related person transaction that is required to be disclosed. and Sachs. a Director generally may not vote on any matter in which he has any material interest. as required by the Audit Committee Charter. we accrued dividends of $3. Under our bye-laws. 19 . Lee. please see their individual biographies in the section entitled “Directors and Executive Officers”.6 million related to the Senior Preferred Shares held by a subsidiary of ST Telemedia. We also purchased approximately $0. Messrs. during this past year. at any time. Clontz. Additionally.000 are disclosed in our proxy statement. during this past year we received approximately $7. although he may be counted in the quorum at the related meeting. who is a member of our Executive Committee. ST Telemedia may cause us to register sales of its common shares.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Review and approval of related person transactions We review all transactions in which the Company participates and in which our Directors and executive officers or their immediate family members or beneficial owners of more than 5% of any class of our voting securities are participants to determine whether such persons have a direct or indirect material interest. Senior Preferred Shares and all common shares or other securities which may be acquired upon the conversion of the Senior Preferred Shares.

all of whom assumed their positions as directors and committee members on December 9. Charles Macaluso and Michael Rescoe. proxies will be voted for election of each of the nominees. which is not anticipated. Eight members were appointed by STT Crossing Ltd. are scheduled to expire at this year’s annual meeting. YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RE-ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE. The threeyear term of the STT Shareholder Group Directors expires at the 2013 Annual General Meeting of Shareholders. Each Director appointed by the STT Shareholder Group has a term of three years unless earlier removed by the STT Shareholder Group. Except where otherwise instructed. Should either nominee be unwilling or unable to serve as a Director. The terms of the remaining two Directors. it is intended that the persons acting under the proxy will vote for the election of another person designated by the Board. 1 ELECTION OF DIRECTORS Our Board consists of ten members.. 2003. and they have been nominated by the Board of Directors for re-election for a one-year term expiring at the 2012 Annual General Meeting of Shareholders. which is a member of the STT Shareholder Group. 20 . our majority shareholder (“STT Crossing”).PROPOSAL NO.

PROPOSAL NO. 2 APPROVAL OF THE REDUCTION OF GLOBAL CROSSING LIMITED’S SHARE PREMIUM ACCOUNT BY TRANSFERRING US$1.2 BILLION TO THE COMPANY’S CONTRIBUTED SURPLUS ACCOUNT, EFFECTIVE ON THE DATE OF THE 2011 ANNUAL GENERAL MEETING OF SHAREHOLDERS Our Board of Directors has recommended and is seeking shareholder approval to reduce the Company’s share premium account by transferring US$1.2 billion to its contributed surplus account, effective on the date of the 2011 annual general meeting of shareholders. Under the Companies Act 1981 of Bermuda, as amended (the “Bermuda Companies Act”), when a company issues shares, the aggregate paid in par value of the issued shares comprises a company’s share capital account. When shares are issued at a premium, meaning that the actual sum paid for a common share or a preferred share exceeds the par value of that share, the amount paid in excess of the par value must be allocated to a capital account called the “share premium account.” The Bermuda Companies Act requires shareholder approval prior to any reduction of the share capital or share premium account. Where a company has received shareholder capital that is not related to shareholder purchases or subscription, Bermuda law provides that a company must maintain a contributed surplus account, where the company must allocate, among other things, such contributed sums. These “accounts” are figures we record in our books and records and do not represent cash on deposit. Our largest shareholder, a subsidiary of ST Telemedia, currently is the holder of 18,000,000 Senior Preferred Shares. The Senior Preferred Shares were issued to ST Telemedia on December 9, 2003 and accumulate dividends at the rate of 2% per annum. Those dividends are payable in cash after the Company and its subsidiaries have, on a consolidated basis, achieved cumulative operating earnings before interest, taxes, depreciation and amortization (calculated in accordance with the certificate of designations for the Senior Preferred Shares) of $650 million or more since December 9, 2003, as demonstrated in audited consolidated financial statements. This target was achieved during 2010, and, subject to shareholder approval of this proposal, it is anticipated that the Company will pay accumulated preferred dividends on the Senior Preferred Shares of approximately $26 million on or after June 15, 2011 and will thereafter pay regular quarterly dividends on such shares. However, the Company’s ability to pay dividends is subject to Bermuda law restrictions. Under Bermuda law, dividends may only be paid out of accumulated earnings or contributed surplus. In light of our $1.938 billion accumulated earnings deficit as of December 31, 2010, for the foreseeable future any dividends to be declared by our Board would need to be paid out of contributed surplus, $1.2 billion of which will be created if this proposal is approved by the shareholders. However, Bermuda law prohibits us from using contributed surplus for dividends or distributions unless we satisfy both of two tests related to the solvency of the Company both at the time of the declaration and at the time of the payment of the dividend or distribution (the “Solvency Tests”). The first Solvency Test requires that we do not have reasonable grounds for believing either that we are, or will after the payment be, unable to pay our liabilities as they become due. The second Solvency Test requires that we do not have reasonable grounds for believing that the realizable value of our assets would thereby be less than the aggregate of our liabilities and our issued share capital and share premium accounts. A high share premium account therefore reduces our Board’s ability to declare and pay dividends. As of December 31, 2010, we had approximately $1.257 billion in our share premium account. If this proposal is approved by the shareholders, the share premium account will be reduced by $1.2 billion to $57 million, and it will increase the Board’s ability to declare and pay dividends, including dividends on our Senior Preferred Shares. The Board will make a determination as to whether both Solvency Tests are satisfied both at the time of the declaration and at the time of the payment of dividends. In order for the Company to satisfy its obligation to pay dividends on our Senior Preferred Shares, the Board has determined that it is in the best interests of the Company to reduce the share premium account by transferring $1.2 billion from that account to the Company’s contributed surplus account, effective on the date of the 2011 21

annual general meeting of shareholders. Such transfer will also increase our flexibility to declare and pay dividends or make distributions on our common shares, although the Board has does not anticipate doing so for the foreseeable future. This proposed reduction of our share premium account and reallocation to our contributed surplus account must be advertised in the official gazette and requires the approval of our shareholders to be effective. Under Bermuda law and the Company’s bye-laws, distributions from our contributed surplus account, however, may be approved and made, subject to the Solvency Tests, by the Board of Directors without any need for shareholder approval. Assuming that our shareholders vote in favor of this proposal, the reduction of our share premium account will allow future dividends and distributions to be made by the Board within the limits prescribed by Bermuda company law. The proposed reallocation of share premium to contributed surplus will benefit ST Telemedia since it will facilitate the payment of dividends on the Senior Preferred Shares, which are owned by a subsidiary of ST Telemedia. Shareholders may therefore wish to consider the relationships between the members of the Board of Directors and ST Telemedia in evaluating the voting recommendation of the Board on this matter. See “Directors and Executive Officers” and “Certain Relationships and Related Transactions”. YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” THE REDUCTION OF OUR SHARE PREMIUM ACCOUNT BY TRANSFERRING US$1.2 BILLION TO OUR CONTRIBUTED SURPLUS ACCOUNT, EFFECTIVE ON THE DATE OF THE 2011 ANNUAL GENERAL MEETING OF SHAREHOLDERS.

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PROPOSAL NO. 3 APPOINTMENT OF INDEPENDENT ACCOUNTANTS Under Section 89 of the Bermuda Companies Act, our shareholders have the authority to appoint the independent registered public accounting firm of the Company and to authorize the Audit Committee of our Board of Directors to determine the auditors’ remuneration. The Audit Committee has tentatively selected Ernst & Young LLP (“Ernst & Young”) as independent accountants to audit our consolidated financial statements for the fiscal year ending December 31, 2011. The Board is asking shareholders to approve such appointment and the authority of the Audit Committee to determine their remuneration. Representatives of Ernst & Young are expected to attend the annual meeting and to respond to appropriate questions and will have the opportunity to make a statement should they so desire. YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE APPOINTMENT OF ERNST & YOUNG LLP AND OF THE AUTHORITY OF THE AUDIT COMMITTEE TO DETERMINE THEIR REMUNERATION.

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PROPOSAL NO. 4 ADVISORY VOTE ON EXECUTIVE COMPENSATION In accordance with Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we are providing our shareholders with the opportunity to cast an advisory vote on executive compensation. As required by those rules, we are asking shareholders to vote on the adoption of the following resolution: “RESOLVED, that the shareholders of Global Crossing Limited approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed in the Proxy Statement dated April 29, 2011, pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis and the related tabular and narrative disclosures.” Our executive compensation program has been designed to promote a performance-based culture and align the interests of executives with those of shareholders by linking a substantial portion of compensation to performance. The program is also designed to attract and to retain highly-qualified executives who are critical to our success. We believe that the executive compensation program, which emphasizes long-term equity awards, including time-based and performance-based restricted stock units, satisfies this goal. Shareholders are urged to read the Compensation Discussion and Analysis section of this Proxy Statement beginning on page 26, which describes in greater detail Global Crossing’s executive compensation program and how our compensation policies and procedures implement our compensation philosophy. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this Proxy Statement. As an advisory vote, this proposal is not binding on Global Crossing; however, we believe that it is appropriate and important to seek the views of our shareholders on the effectiveness of our executive compensation program as a matter of good corporate governance and in doing so, the Board of Directors and the Compensation Committee will review the voting results in connection with their ongoing evaluation of the Company’s compensation program. YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RESOLUTION FOR APPROVAL OF THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS.

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be held at an Annual Meeting of the Shareholders (a) every year.PROPOSAL NO. on an advisory basis. we are providing you with the choice to cast your vote on your preferred voting frequency by choosing the option of one year. Section 14A of the Exchange Act requires that the Company include a “say-on-pay” vote every one. Therefore. the compensation of Global Crossing Limited executive officers.” The vote is advisory and not binding upon the Company. The current view of the Board is that an advisory vote on executive compensation held every year would best enable stockholders to timely express their views on the Company’s executive compensation program and enable the Board and the Compensation Committee to determine current shareholder sentiment. YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE TO HOLD SAY-ON-PAY VOTES EVERY YEAR (AS OPPOSED TO EVERY TWO OR THREE YEARS). the Board recommends that a “say-on-pay” vote be held on an annual basis. “RESOLVED. two years or three years when you vote in response to the resolution set forth below. (b) every two years or (c) every three years. that a non-binding vote of the shareholders to approve. 5 ADVISORY VOTE ON FREQUENCY OF SAY-ON-PAY VOTES As described in Proposal No. the Board of Directors and the Compensation Committee will take into account the outcome of the vote when determining how often the Company should conduct an advisory vote on the compensation of our named executive officers. our shareholders are being provided the opportunity to cast an advisory vote on Global Crossing’s executive compensation program (a “say-on-pay vote”). 25 . However. Notwithstanding the Board recommendation. two or three years. 4 above.

The final total shareholder return performance for the 2008-2010 performance-based RSUs that vested on December 31. The following discussion and analysis summarizes the executive compensation program and the decisions under that program made for fiscal year 2010 with respect to Chief Executive Officer John J. the “Named Executive Officers” or “NEOs”). the Company did not achieve its “Invest & Grow” revenue growth guidance or the financial targets established under the 2010 annual incentive program. Continued weak relative stock price performance will result in a lesser number of performance-based restricted stock units that will ultimately vest under long-term incentive grants made to the NEOs. The Company completed 2010 within the annual guidance ranges provided in February 2010 for operating income before depreciation and amortization and net cash provided by operating activities less purchases of property and equipment.S. Nevertheless. fostering and maintaining a strong and experienced senior management team in order to achieve its long-term business goals.6% decrease in shareholder value. Specifically. In addition. 2011. Each of the NEO’s received an award of restricted stock units under this program with a three-year scheduled vesting period. the Company’s stock price performance lagged that of the indices used to calculate relative total shareholder performance under the Company’s long-term incentive program. 2010 Overview At the time the Company established 2010 compensation programs early in the year. The Board also voted to discontinue the temporary 25% reduction in its own compensation first implemented in March 2009. payable in cash and/or restricted stock units (depending on band level). Legere and the other executive officers named in the Summary Compensation Table on page 33 (collectively. The Company’s 2010 compensation programs attempted to acknowledge the nascent recovery and to increase the Company’s competitiveness in the labor market while at the same time prudently managing the Company’s limited resources. including the NEOs. In that regard. announced the reinstatement of company matching contributions under the defined contribution plan for U. Each participant was granted an opportunity to receive an award valued at 50 percent of their target annual bonus. In light of that fact. the Board of Directors approved a special rewards program intended to retain and motivate certain employees. 2011.EXECUTIVE COMPENSATION COMPENSATION DISCUSSION AND ANALYSIS The Company understands the importance of attracting. On January 21. Our NEOs experienced a proportionate decrease in the value of their holdings of Company shares and equity-based awards. as explained below. the world economy and financial markets were in the early stages of a slow recovery from the great turbulence and uncertainty that prevailed during 2009. subject to continued employment through a designated vesting date. align rewards with shareholder value and provide a competitive compensation package that will assist in the retention and motivation of highly qualified senior executives. A description of these grants is provided on page 30.-based employees effective January 1. The Company’s stock price declined in 2010. 26 . and continued measures to help ensure that any payout under the annual incentive plan would be subject to the absolute discretion of the Compensation Committee and Board of Directors. 2010 resulted in a payout of 30% of the target number of RSUs. the Company’s executive compensation program is designed to link compensation to performance. This discussion should be read together with the corresponding compensation tables. resulting in a 13. the final payout amount under the 2010 annual incentive program was 35% of the targeted amount for most employees. the Company lifted the general salary freeze in effect since 2009.

objective or subjective. although none of the NEO’s 2010 bonus payouts were so modified. In early 2011. the Committee and Board determined that the limitation on funding of cash compensation is no longer appropriate in light of the desire to avoid unnecessary constraints on investments that could foster growth and based on the belief that a formulaic approach to cash compensation is no longer necessary in light of improvements in external and internal financial circumstances since the date of adoption of the Compensation Principles. The Company ties annual incentive compensation to key performance indicators which are reviewed by the Board at least quarterly. The performance indicators for the 2010 short-term incentive program were (a) operating income before depreciation and amortization (“OIBDA”) and (b) net cash provided by operating activities less gross purchases of property and equipment (“Free Cash Flow”). the Committee and the Board of Directors developed “Compensation Principles” to provide Company management with general guidelines regarding incentive compensation programs and the anticipated use of cash and stock in such programs. To assist in this process. which has been retained as the Committee’s independent executive compensation consultant. We review annually the overall compensation philosophy and policies for executive officers. The philosophy takes into account the following goals: • • • Linking compensation to performance Aligning rewards with changes in shareholder value Attracting and retaining top quality management Linking compensation to performance The Company believes that a significant portion of each NEO’s total compensation should be “at risk. This philosophy applies to all Global Crossing employees. although they recognized that factors such as the timing of cash items and the impact of financing activities should be taken into account in funding cash compensation. including the NEOs. Compensation Philosophy The Company considers compensation programs holistically when establishing executive compensation opportunities. The bonus program allows for the Committee to further adjust individual bonus payouts by up to 30% based on individual performance. Hewitt Associates spun off a portion of its executive consulting business into a separate company named Meridian Compensation Partners. which has been Hewitt Associates since 2004. The Committee also considers market data and analyses provided by the Committee’s compensation consultant. the Committee and the Board continued to operate under these guidelines. During 2010. 27 . and (c) the annual bonus program would be designed in a manner intended to reserve absolute discretion to the Board. During 2010. the Committee considers recommendations made by the Company’s Human Resources Department and the CEO (except with respect to his own compensation).Roles of Those Involved in Setting Executive Compensation The Compensation Committee of the Board of Directors oversees the Company’s executive compensation programs and makes recommendations to the Board regarding compensation for executive officers. with a more significant level of compensation at risk as an employee’s level of responsibility increases. as they deemed prudent. The Company’s compensation philosophy for NEOs is intended to link the compensation of such officers to measures of Company performance that contribute to increased value for Global Crossing’s shareholders. These guidelines conveyed the Board’s intention at that time that: (a) the funding of cash compensation programs would be limited to cash generated from the Company’s own business operations. (b) authorization for additional shares under the stock incentive plan would not be sought through 2012. although discretion continues to be a fundamental aspect of bonus plan design. necessary or appropriate. The Committee and Board also determined that the reservation of absolute discretion over every component of the annual bonus program is no longer necessary. the Committee and Board reserved the absolute discretion to modify or eliminate the funding of the 2010 bonus pool based on any factors. Consistent with the above-referenced Compensation Principles as then in effect. In March 2009.” meaning tied to one or more key indicators of performance.

1 Telecommunication Comparators: CenturyLink Inc. Frontier Communications Corp. The major components of compensation for NEOs are base salary. Windstream Corp. which provide a current snapshot of total annual compensation rates. Attracting and retaining top quality management In an effort to provide a competitive compensation package. long-term incentives in the form of equity grants. growth prospects and competitive positioning.. DST Systems Inc. as further explained below.. The Committee will continue to look both within the telecommunications industry and across broader industry segments to assess external benchmarks for executive compensation. a significant portion of each NEO’s total compensation for 2010 was composed of grants of timebased and performance-based restricted stock units. including benefit or perquisite program features or common practices in employment agreements and executive severance plans. as described in more detail below. TW Telecom Inc. We target both total cash and total direct compensation at the 50th percentile of the benchmark group.1 A regression analysis is performed to adjust the market data to reflect expected market practice at companies with a similar revenue base as ours. short-term performance-based incentives in the form of annual bonuses. the Committee annually reviews the structure of the executive compensation program and sets targeted compensation levels after comparing data to that of a group of select peer companies. ADP Inc. experience and performance during the prior year. IDT Corp. The benchmarking assessment used for 2010 compensation actions included ten telecommunications and eleven technology services industry comparators of similar size... From time to time we also benchmark other aspects of compensation. the number of the performance-based restricted stock units that will ultimately vest is based on the Company’s relative total shareholder return over a three-year performance period. as demonstrated in the Summary Compensation Table on page 33. Each of the major components of 2010 NEO compensation is described in more detail below.. However. IHS.. The Committee also considers each NEO’s skills. The Compensation Committee periodically reviews executive compensation tally sheets. Technology Services Industry Comparators: Acxiom Corporation.The performance indicator applicable to the 2010 long-term incentive program was relative total shareholder return. Qwest Communications Intl Inc. as well as internal information intended to gauge pay equity among our executives and between our executives and our non-executive employees. While these are not used directly to determine compensation... which we believe is appropriate for our Company given its financial profile. In addition.. Imation Corporation.. Thomson Reuters Corporation and Unisys Corporation. 28 . . Equifax Inc. accumulated stock ownership (both vested and unvested) and the Company’s liabilities associated with various termination events for each NEO. Inc. Executive Compensation Component Summary Each component of NEO compensation emphasizes a different aspect of the Company’s compensation philosophy. and certain financial security benefits. Level 3 Communications Inc. Aligning rewards with changes in shareholder value The Company believes that a significant portion of each NEO’s total compensation should vary based on changes in shareholder value. and XO Holdings Inc. Cincinnati Bell Inc.. this target serves as just one reference point when establishing total compensation opportunities. Global Payments Inc. Fiserv Inc. Primus Telecom Group. NCR Corporation. The Committee’s compensation consultant provides current competitive benchmarking information from companies in the telecommunications industry and in technology services. thereby aligning the interests of the NEOs with those of shareholders generally. they are reviewed to monitor compensation programs and understand the impact of potential actions. In this regard..

John B. subject to approval by the Board of Directors. . . . McShane . The Committee reserves the right in its sole discretion to modify or terminate this program in its entirety without prior written notice to or consent of the NEOs. . .000 to $550.0 million $ 29. . market demand). . . . . . . . . . . . . . . . internal parity considerations. . . . . . . . . . . . . . . To determine a NEO’s 2010 bonus payment. 2010. . . .0 million $ 365. . . . . . . . . . . . . . . the Committee increased Chief Financial Officer John Kritzmacher’s annual salary from $495. .Base Salary The Company sets initial base salaries for NEOs based on recruiting requirements (i. . . . . .0 million $ 4 million $463. . . . the NEO’s 2010 salary was multiplied by the applicable target bonus opportunity referenced above and by a performance factor as determined by the Compensation Committee. . . in whose case the Committee works independently with its consultant). . . the 2010 plan included threshold and maximum performance targets and payout percentages. . Short-Term Performance-Based Incentive The annual incentive program is designed to incentivize NEOs to help the Company attain key financial objectives as described below. . . . . Legere’s target annual bonus opportunity is fixed by the terms of his employment agreement. Increases are determined by the Committee. Any adjustments in base salary for existing NEOs are raised by management for consideration by the Committee (except for the CEO. . . 50% 50% $ 383. . 2011. . . . . . . competitive pay practices. . . . . . . . . . . . . . . . . . Enright .0) million . . . . . . .e. . Carey . . . . . . . . . . Based on the evaluation described above. . . . . . .0 million ($ 34. . . . . The quantitative financial performance measures for the 2010 bonus program were designed to reward attainment of targets for OIBDA (50% of the target opportunity) and Free Cash Flow (50% of the target opportunity). . . . . . subject to applicable local labor laws. . . The following table sets forth the financial performance targets for the 2010 bonus program and the performance achieved. . and Executive Vice President and General Counsel John McShane’s annual salary from $395. . . .000 to $428. . . . . . . . . based on the annual evaluation of competitive data and a subjective assessment of the individual’s performance. . Performance Metric Weight Threshold Target Maximum 2010 Performance* OIBDA . . . . . . . accomplishments.0) million 29 $423. Compensation expense is assumed at targeted levels in the calculation of OIBDA for incentive compensation purposes. . . . . . . . . Legere* . . . John Kritzmacher . . . . . The Committee determines target bonus opportunities for NEOs based on the results of external benchmarking and the individual’s level of responsibility and expected influence on corporate results. . . The target annual bonus opportunities established for the NEOs for 2010 were as follows. . . . . . . . . expressed as a percentage of salary received during the course of the year: 2010 Target Annual Bonus Opportunity John J. . . . . Daniel J. . . . . . individual experience and breadth of knowledge. . . . . . . . * 100% 65% 65% 65% 65% Mr. . .. . The Committee approves target bonus levels and quantitative financial performance measures on an annual basis. . . . . . Target annual bonuses for NEOs are presented to the Board of Directors with the Committee’s recommendation. . . . . David R. . and historical salaries for these executives.0 million ($ 21. . . . .000 effective January 1. . . . . . . . . . . . . . contribution to the Company and potential within the organization. Unlike the 2009 annual bonus plan. . . . . . . . . . . . .700 effective February 1. . Free Cash Flow . . . . . . . . . although the payout remained discretionary even for performance above threshold amounts. . . and internal parity considerations. . . . . . . . . .

2013 solely based on the continued employment of the executive through that date and one half of which vest on December 31. The Committee generally makes annual grants at a meeting that is scheduled well in advance as part of the Committee’s annual calendar. individual performance. Long-Term Incentive Compensation: Equity Grants While bonuses are paid for prior year accomplishments. provided that the portion of any payout exceeding 100% of the target award will be paid at the sole discretion of the Compensation Committee and is be expected to be paid. 2012 based on a total shareholder return (TSR) measure. provided that discretion does not apply in the event of accelerated vesting due to a change in control. The Committee awards equity grants in its discretion based on an annual evaluation of competitive market data. the Committee and Board determined in their discretion that a partial bonus payout was warranted. The final overall bonus payout percentage approved by the Board varied from 30% to 45% of target. if at all. in cash rather than shares. For Global Crossing and for each company in each peer group. Key factors leading to this determination included the Company’s overall improved financial performance. (2) Free Cash Flow for bonus purposes excludes the impact of new capital leasing. level of responsibility. and (3) both OIBDA and Free Cash Flow exclude the impact of new merger and acquisition activities for bonus purposes. Such “single trigger” vesting is deemed appropriate in light of competitive pay practices and the desire to ensure the engagement of management both before and during an impending corporate transaction. longterm incentive grants made in prior years and the anticipated contribution that the executive officer will make to Global Crossing. depending on business area. Although the performance targets were not achieved. Each NEO received a cash bonus payout for 2010 equal to 35% of his respective target annual bonus opportunity indicated above. TSR over the three years is calculated by comparing the average stock price in the last month of the performance period to the average stock price in the month immediately prior to the start of the performance 30 . Grants are made under the 2003 Global Crossing Limited Stock Incentive Plan and provide for vesting of all awards upon a “change in control” as defined in the plan. one half of which vest on February 1.and size-specific peer groups: • • NASDAQ Telecommunications Index Companies S&P 600 Small Cap Companies The range of payout for the 2010-2012 performance-based shares is 0% to 200% of the original award amount based on the Company’s percentile TSR ranking among the two peer groups. on an absolute basis and relative to telecommunication peers. This TSR measure compares Global Crossing’s ranking in total shareholder return to companies in the following industry. the Company believes equity grants help properly align NEOs with shareholder interests over the long-term. and stronger relative financial performance in certain regions. NEOs received their 2010 grants in the form of restricted stock units. The Company focuses on the following strategies in delivering long-term incentive compensation: • • • • • Tie a meaningful portion of incentive compensation to stock ownership and relative stock price performance among peers Ensure a strong alignment with our business strategy Conserve share usage and limit dilutive impact by the use of restricted stock units instead of stock options Differentiate where necessary based on individual performance and potential Retain executives through the establishment of meaningful forfeitable balances In an effort to retain executives while holding them accountable for corporate performance.* These results differ from actual reported results as follows: (1) OIBDA for bonus purposes includes compensation expense at targeted levels.

. . . . . . . . Since each index was weighted equally. . . . . . . . Additional Executive Compensation Policies and Practices The administration of the Company’s compensation programs is subject to the following additional policies and practices. . . . . The table below describes how the Company’s percentile ranking among peers translates into a payout percentage of the original target shares awarded. . . . the final payout totaled 30% of the target number of shares. Financial Security Benefits Severance Protection We offer the Key Management Protection Plan (“KMPP”). . . . . Our retirement program includes a qualified defined contribution plan (the Employees Retirement Savings Plan.1% TSR percentile rank against the S&P 600 index. . . which was amended in December 2009 to extend the contractual term of the agreement to August 15. . . . . . . . . . . 2012. . . . . an unfunded. . 2006 employment agreement. . . . Legere’s severance arrangements are governed by his August 15. . . . . . Mr. Legere. . . . . . . . . . . . . . . . . . . . . which permits all U. . . . . . . . . . . . . . . except Mr. . . . . . . Global Crossing’s Three-Year TSR Percentile Ranking Among Peers Percent of Original Target Award Paid Below 30th . . . . . . . 30th to <40th . . . 2011. . . . The Company achieved a 60% payout based on a 33. . . . 60th to <70th . . 80th or above . . . 70th to <80th . . . . and the two results are averaged to determine the actual percentage earned. . . .S. . . . . . . . . . . or ERSP). . . . .5% TSR percentile rank against the NASDAQ Telecom Index and a 0% payout based on a 16. . . . . . . . . . . . . 2010. . . . . . . . . . 31 . . . based employees to make tax qualified contributions of up to 25% of eligible pay. . . The estimated liabilities for various termination scenarios are outlined below under “Potential Payments Upon Termination or Change of Control”. . . . . . . . . . . . . . . . 50th to <60% . . . . In July 2009 the KMPP was extended through December 31. . . . . . . . . . . . . . . The Company also maintains the Supplemental Retirement Savings Plan (SRSP). . . . . . . . There was no Company match in 2010. . The performance period for the 2008-2010 performance-based shares concluded on December 31. . . the Company reinstated a match of 100% of the first 1% contributed and 50% of the next 5% contributed to the ERSP effective January 1. . . . . . . . . Legere’s termination arrangements as reasonable and in line with competitive practice. . . . . nonqualified deferred compensation plan that allows employees whose contributions to the ERSP are effectively limited to less than 25% of eligible pay (due to dollar limits imposed by the Internal Revenue Service) to defer up to 16%. to help attract key talent and retain leaders by mitigating their concerns about financial hardship in the event of termination. . . . . . . . . . . . . . . Benefits & Perquisites We offer our NEOs the same health and welfare benefit. . . . . . . . . however. . . . . . . . The calculation also includes dividends paid during the performance period. . . We view the KMPP and Mr. . . . . . . . . . . . . . . . an enhanced severance plan. . . . * 0% 60% 80% 100% 120%* 160%* 200%* Any payout over 100% is subject to Compensation Committee discretion except in the event of accelerated vesting due to a change in control. . . . . . . . . . . . . . disability and insurance plans as we offer all employees. . . . . . . . . . The Company maintains no other nonqualified retirement or deferred compensation programs and offers limited additional executive perquisites. . . . . . . . . . . . . . . . . . . . . . . . . . . . which the Company believes to be consistent with its executive compensation philosophy and goals. . . . . . . . . . . . . . . . . . . . 40th to <50th . . . . . . . . . . 2011. . . .period. . . All NEOs participate in the plan. . . . . but with no Company matching contribution. . . . . The ranking and payout percent is calculated separately for each peer group. . We view this relatively limited set of benefits and perquisites as appropriate relative to the Company’s current financial situation and its path to sustained profitability. . . . .

S. THE COMPENSATION COMMITTEE Peter Seah Lim Huat.S. as a result of misconduct.7 times the executive’s annual salary. Based on the share price as of December 31. the Company’s annual incentive plan is not currently being administered in a manner that qualifies as “performance-based” compensation under Section 162(m) since the Company believes that the benefit of retaining discretion to avoid inappropriate bonus payouts outweighs the possible loss of deductibility under Section 162(m).S. However. However. although we believe that our long-term incentive program helps align our executives’ interests with the interests of our shareholders. Tax Deductibility Policy Section 162(m) of the U. the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement. Since we currently operate at a loss for U. Internal Revenue Code limits the U. with any financial reporting requirement under the securities laws. as of this date each NEO had holdings of common shares and restricted stock units together valued at between 3.Stock Ownership Guidelines We have no minimum stock ownership guidelines or holding requirements for vested shares. based on such review and discussions. including any profits realized from the sale of the Company’s securities. we intend to administer compensation plans in compliance with the provisions of Section 162(m) where feasible and where consistent with Global Crossing’s compensation philosophy. Report of the Compensation Committee The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Commission Regulation S-K with management and. federal income tax deductibility of non-”performance-based” compensation payments in excess of $1 million paid to a NEO in any one year. Clawback Policy We do not have a formal policy regarding the adjustment or recovery of awards or payments if the relevant performance measures upon which they are based are restated or otherwise adjusted in a manner that would reduce their size.5 and 8. if the Company is required to prepare an accounting restatement due to the material noncompliance. In general. pursuant to section 304 of the Sarbanes-Oxley Act of 2002. compliance with Section 162(m) increases our net operating loss carry-forwards rather than reduces current income taxation. corporate income tax purposes. 2010. the CEO and CFO must reimburse the Company for any incentive-based compensation received during the 12-month period following the issuance of the noncompliant financial statements. Chairman Archie Clemins Lee Theng Kiat Robert Sachs 32 .

Pursuant to the terms of his employment agreement.110 Chief Executive Officer 2009 1.774 10.000 — 8. and McShane.733 395.125 1. .903 387. .000 125.863 587.682.100.250.927 350.825 1. and the actual payouts were 78. Legere). Legere. Mr.750 — 1. . the Board and the Compensation Committee exercised their discretion as permitted under the program to award payouts under the program. . $199.Summary Compensation Table The table below sets forth information concerning compensation paid to our CEO. the “Named Executive Officers”) during the periods presented. respectively.9% of annual bonus target.629 1.806 for Messrs.207. $252. .125 851.353 27. the Board and the Compensation Committee exercised their discretion as permitted under the program to award a payout of 31.963. .835. Carey.067. .682 3. See “—Compensation Discussion and Analysis—Short-Term PerformanceBased Incentive” for more information.732 425.568 1.377. (a) (b) (c) (d) (h) Change in Pension Value and Non-Equity Nonqualified Stock Option Incentive Plan Deferred Awards Awards Compensation Compensation (3) (4) ($) ($) ($) Earnings ($)(5) — — — — — — — — — — — — — — — — — 432. .119 1.450 for Messrs. Although the Company did not achieve the performance targets under the 2009 bonus program.100.069 595.168. . $356. The amounts shown for 2008 in Column (e) encompass. which payouts were payable in unrestricted common shares of the Company (subject to the exception described below relating to Mr. Legere.814 John J.921 59 3.733 425.106.602 2. The maximum payouts under the 2008 annual bonus program were $1. Enright. .867.581 1. . 2010 EVP.063 1.574 785.535 5. . .871 4.078. Kritzmacher(1) .802 1.888 595.789 59 2. Kritzmacher. (3) Column (e) includes the grant date fair value in respect of restricted stock units awarded to each of the Named Executive Officers. and $359. .300 — — — — — — — — — — — — — — — — — — — — — 27.000 91.755 2008 1. and $201.534 1. 2010 EVP. among other things.750.610 123.600. CFO and the three other most highly compensated executive officers (collectively.670.414. Kritzmacher.107.858 88.450. . Legere’s 2008 bonus opportunities were payable one-half in cash (which is reflected in column (g)) and one-half in common shares (which is reflected in column (e)).415 400.540.757 1. .337 82.000 — 1. . 2008.000 89.852 595.526. .571 395.896.581 John A.133. 2010 EVP and Chief Financial 2009 Officer 2008 David R. Kritzmacher was appointed Chief Financial Officer of the Company effective October 1.000 — 1.903 416. $217.000.795 — — — (e) (f) (g) (i) (j) Name and Principal Position Salary Year ($) Bonus ($)(2) All Other Compensation ($)(6) 4.544.232 3. Strategy and 2009 Corporate Development 2008 Daniel Enright .000 587.445 485.817.000 3.688 587.446 3.434.403 8. Although the Company did not achieve the performance targets under the 2010 bonus program.525.114. . Enright.733 391.413 — 1. Carey . 2010 1. and McShane respectively. The target payouts reflect the probable outcome of the performance conditions as of the date of grant of the awards. or $864. . Global Operations 2009 2008 John B.899 Total ($) 4.660 1.310 7.000 385. which in the case of the Named Executive Officers comprised 35% of their respective annual bonus target. Legere .517 102. .410 2.000 96. but modified to eliminate any reduction in the grant date fair value of the awards for the possibility of service-based forfeiture. .990. $450. 2010 EVP and General Counsel 2009 2008 550. Carey.328 1.903 392. McShane . (2) The amounts shown for 2010 are payments made under the 2010 discretionary incentive compensation bonus program.081.446 7.433 81. as determined pursuant to FASB ASC Topic 718. . .303 1. .178 4. .761 2. the target payouts that could have been awarded to the Named Executive Officers under the 2008 annual bonus programs. . .072. . 33 .696. .412.915 (1) Mr. The amounts shown for 2009 are payments made under the 2009 discretionary incentive compensation bonus program. $386.6% of annual bonus target. .

Enright. Of the Named Executive Officers. Legere’s 2008 annual bonus in cash.460. Legere. Kritzmacher.930. See the discussion under the caption “Non-Qualified Deferred Compensation Table” below. $815.703 for Mr.070. Legere.The amounts shown for 2010. 2009.702. 34 . Carey.662. The maximum grant date values of the performance-based restricted stock units under the 2008 long-term incentive program (based on a payout of 200% of target) were $13. (5) Of the Named Executive Officers. and McShane. $562. The target numbers of performance-based restricted stock units reflect the probable outcome of the performance conditions as of the date of grant of the awards.890. among other things. The amounts shown in column (h) for Mr. $740. respectively.220. $561.495.620. or could have been. (6) The amounts shown in column (i) for 2010 include. awarded to the Named Executive Officers under the 2010.625.570 and $1. $4. $1. Enright.063. Enright participates in a non-qualified deferred compensation plan or pension plan.890. 2009.564.495. Kritzmacher. Legere. and McShane. only Mr. and McShane. 2010.562.702. (4) As indicated in note (2) above. $561. tax gross-up payments of $4. Except as noted above in this footnote.570 for Messrs. Information regarding our calculations of pension values is set forth in footnote 17 to the Company’s consolidated financial statements included in its annual report on Form 10-K/A and the amendment thereto for the fiscal year ended December 31. Carey.476 for Mr. Enright. and $562. respectively. and 2008 also encompass. Carey participates in a deferred compensation plan. and the actual payouts were 30% of target.702.495 for Messrs. The maximum grant date values of the performance-based restricted stock units under the 2009 long-term incentive program (based on a payout of 200% of target) were $3. and 2008 long-term incentive programs. The maximum grant date values of the performance-based restricted stock units under the 2010 long-term incentive program (based on a payout of 200% of target) were $3. respectively.173 for Mr. 2009 or 2008. respectively. Carey and $1. $1. 2010. Enright represent the change in the actuarial present value of his accumulated benefit under the New Global Crossing Frozen Pension Plan. Enright. $562. the target numbers of performance-based restricted stock units that may be. only Mr.570. and $561. Legere. among other things. Kritzmacher. He did not receive any above-market or preferential earnings on such deferred compensation in 2010. the fair value of the stock awards was determined using the valuation methodology and assumptions set forth in footnotes 2 and 16 to the Company’s consolidated financial statements included in its Form 10-K/A for the fiscal year ended December 31. Carey. $1.890 for Messrs. column (g) reflects the payment of one-half of Mr.

.458 $ 281.500 — 43. RSU (Time) 02/01/10 RSU (Performance) 02/01/10 John B.500 — 21. 2011 and 2012 fiscal years.Grants of Plan-based Awards (a) (b) (c) (d) (e) (f) (g) (h) (i) (l) Name Award Type Grant Date All Other Stock Awards: Grant Estimated Future Payouts Estimated Future Payouts Number Date Fair Under Non-Equity Incentive Under Equity Incentive Plan of Shares Value of Plan Awards Awards(1) of Stock Stock and Option Threshold Target Maximum Threshold Target Maximum or Units ($) ($) ($) (#) (#) (#) (#)(2) Awards(3) — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 35. . 2010 will vest on December 31. The target amount reflects the probable outcome of the performance conditions as of the date of grant of the award.445 John J. RSU (Time) 02/01/10 RSU (Performance) 02/01/10 David R.445 $ 306. Kritzmacher . The Performance-Based RSUs granted on February 1. . 2012 based on total shareholder return for the combined 2010.458 $ 281. RSU (Time) 02/01/10 RSU (Performance) 02/01/10 118.750 — $1. (2) The amounts shown for the Award Type “RSU (Time)” in column (i) reflect 2010 time-based restricted stock units (“Time-Based RSU”) grants under the long-term incentive program.” Column (f) reflects the threshold payout.750 — 21. . .500 — 43.779 $1.750 — 21. 2013 solely based on the continued employment of the executive through that date.650 — 31. . . . Legere .650 237. which is discussed in further detail under the caption “Long-Term Incentive Compensation: Equity Grants. .450 — 6. RSU (Time) 02/01/10 RSU (Performance) 02/01/10 Daniel Enright . . . which is discussed in further detail under the caption “Long-Term Incentive Compensation: Equity Grants. .445 $ 306. .500 — 21.750 — 63.750 — 21. .525 — 6. . . .610 $ 306. Carey . . . which is 30% of the target amount shown in column (g) (representing the threshold payout of 60% for either one of the two separate performance metrics that each comprise half of the overall award opportunity). .595 — 9.835 $ 407. . 2010 will vest on February 1. . . The amount shown in column (h) (maximum) is 200% of such target amount.331 $ 443.535.671.750 — 21. RSU (Time) 02/01/10 RSU (Performance) 02/01/10 John A. . 2010. . McShane . . . The Time-Based RSUs granted on February 1.458 $ 281. . .525 — 6.” (3) The amounts shown in column (l) are the grant date fair values as determined pursuant to FASB ASC Topic 718.300 — 31.500 (1) The amounts shown for the Award Type “RSU (Performance)” in columns (f) through (h) reflect 2010 performance-based restricted stock unit (“Performance-Based RSU”) grants under the long-term incentive program. 35 . Except as noted in the immediately preceding sentence. but modified to eliminate any reduction in the grant date fair value of the awards for the possibility of service-based forfeiture.000 — 43. the fair value of the awards was determined using the valuation methodology and assumptions set forth in footnotes 2 and 16 to the Company’s consolidated financial statements included in its Form 10-K/A for the fiscal year ended December 31.525 — — 118. .

October 1.849.16 $15. 2008.000 22. . 50.16 $15.39 12/9/2013 12/15/2014 $10. . 2008.39 Option Expiration Date 12/9/2013 12/15/2014 Number of Shares or Units of Stock That Have Not Vested (#) 452. . . . . . . . 2009 and February 1. . . . . .184. Carey . (2) Market Value based on the fair market value of the common shares on December 31.400 — — John A. .330 17. McShane .750 — — 91. . Number of Securities Underlying Unexercised Options (#) Exercisable 325.39 12/9/2013 12/15/2014 (1) All options are fully vested. (3) Columns (g) and (h) include the March 4. .000 John B.000 88. 36 .750 — — 111.164 $1. . . .000 Option Exercise Price ($) $10. Legere . . . 2009 and February 1. . . . . April 15.000 Daniel Enright .530 — — $1. 2010 of $12.000 15. . .39 12/9/2013 12/15/2014 $10.Outstanding Equity Awards at Fiscal Year-end (a) (b) (e) Option Awards(1) (f) (g) (h) (i) Stock Awards(2)(3)(4) (j) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares. 50. .077.92 per share. . . . Units or Other Rights That Have Not Vested ($) $4. . .077. . . . .700 67. . . . . . . .400 — — 83.16 $15. . (4) Columns (i) and (j) reflect target payouts for the April 15.077. . 33.751.764 $ 870. 2010 Performance-Based RSU grants. .400 — — 83. . . . . .400 — — 67.808 — — $ 870. .528 — — $1. . . .808 — — $ 870. .443. . .528 — — Equity Incentive Plan Awards: Number of Unearned Shares. 2010 Time-Based RSU grants.528 — — $1.400 — — Market Value of Shares or Units of Stock That Have Not Vested ($) $5. . . .400 — — 67. David R.808 — — Name John J.700 83. . Kritzmacher .000 $10. . . . .16 $15. Units or Other Rights That Have Not Vested (#) 367. . .330 — — $1. . .

. . . Carey. . . . . Enright. . . . .600 19. . . . . . . . . . . . . Kritzmacher. . . . . Inc. . .75. . . . . . . (a) (d) (e) Stock Awards(1) Number of Value Shares Realized Acquired on on Vesting Vesting (#) ($)(2) Name John J. and McShane pursuant to the Performance-Based RSU portion of the 2008 long-term incentive grant. Carey . . which was his number of years of service with the Company when the plan was frozen in 1996. . . . . . . In the case of Mr. . . . . . and (ii) the number of shares received in December 2010 by Messrs. Once the employee begins to receive pension payments. . . . . . Enright. . 119. . . . . . .632 $ 295. . . . .75(1) $246. . .485(2) $0 (1) Mr. . . . with all calculations based upon compensation levels at the time pension plans were frozen in 1996.040 $ 310. Global Crossing does not have any current active defined benefit plans. . . . . . . John A. . . which are the vesting dates for the Time-Based RSU portion of the 2007 long-term incentive grant and the Performance-Based RSU portion of the 2008 long-term incentive grant. . . Alternatively. . 2010. . . Of the Named Executive Officers. . . . . although Global Crossing North America. . . . . . . . . . . . . . David R. . a wholly owned indirect subsidiary of the Company. . . . (b) when they are at least 52 years old if they have completed at least 17 years of service. .55 on March 13. . . . . . . . . . . . Eligibility for pension payments is based upon the participant’s age and the number of years worked for the Company (based on a minimum of 1. . . . . . Kritzmacher . Legere. . . . Pension Benefits Number of Years Credited Service (c) Present Value of Accumulated Benefits ($) (d) Payments During Last Fiscal Year (e) Name (a) Plan Name (b) Daniel Enright . . . . . . . . . . . . . . . . (2) Values based on the per share fair market value of the common shares of $15.660. . . . . . . . . . . . . . . . . . .000 21. . . . . . . . . John B. .Option Exercises and Stock Vested None of the Named Executive Officers exercised stock options during 2010. . Legere . . . . . . . his monthly pension benefit would be $1. A full pension will be paid for participating employees who elect to start receiving their pension payments at age 65. . The following table sets forth the details of stock awards that vested during 2010. 2010 and $12. . (2) For a discussion of the valuation method and actuarial assumptions used. continues to sponsor a frozen pension plan (The New Global Crossing Frozen Pension Plan) for the benefit of employees who previously participated in such plans. Enright participates in this plan. . . . . employees who satisfy certain criteria regarding age and years of service may receive an early pension. . . .000 hours of employment per year). . . . . . . . . . . . Legere.082 $ 279. Enright and McShane pursuant to the Time-Based RSU portion of the 2007 long-term incentive grant. . . . . Specifically. . . . . . . . . . Enright’s number of years of credited service is 9. . . . the monthly amount does not change. . . New Global Crossing Frozen Pension Plan 9. . . . . . . .906 $ 155. Daniel Enright . . . see footnote 17 to the Company’s consolidated financial statements included in its Form 10-K/A for the fiscal year ended December 31. . . . . . .600 20. employees may start receiving early pension benefits (a) when they are at least 47 years old if they have completed at least 22 years of service with the Company. . . . .600 $1. . . . .800 12.92 on December 31. only Mr. respectively. . . . . .505 if his pension payments were to start at age 65. . . .. . . .532 (1) The amounts in column (d) reflect (i) the number of shares received in March 2010 by Messrs. . . . . . 2010. . . or (c) at any age if they 37 . McShane . . . . . . . . . . . . . . . . . . Carey. . . . . . . . . . . . . . . . . .

and (3) entitles Mr. The plan allows Mr. . or a failure by a successor of the Company to assume the Company’s obligations under the agreement) (the “Designated Terminations”) in an amount equal to three times the sum of Mr. In addition. 2006. 2008. Enright. Legere to attend all meetings of the Board and to receive all materials provided to Board members. a material uncured breach by the Company of the agreement. In the case of Mr. 38 .505 if he were to separate from the Company in the future but before age 52. 2003 (the “2003 Agreement”). only Mr. Non-Qualified Deferred Compensation Table Executive Contributions in Last Fiscal Year (b) Registrant Contributions in Last Fiscal Year (c) Aggregate Earnings in Last Fiscal Year (d) Aggregate Withdrawals/ Distributions (e) Aggregate Balance at Last Fiscal Year End (f) Name (a) David Carey . The Amended 2006 Agreement supersedes the employment agreement between the parties dated December 9. Agreement with John Legere On August 15. (3) provides that Mr. 2008. . Employment Agreement The Company does not have any employment agreements with any Named Executive Officer except for John Legere. Legere following approval thereof by the Board on that same date. Legere’s death.have completed at least 27 years of service. Legere with an annual base salary of $1. The Original 2006 Agreement was amended by an amendment dated as of June 24.1 million and a target annual bonus of $1. “disability” (as such quoted terms are defined in the agreement) or resignation for “good reason” (which includes a material diminution in the nature or scope of his authority. .407 and $1. liability insurance and the resolution of disputes thereunder.099 $0 $254. (2) entitles Mr. an amount between $1. (2) provides for the payment of severance to Mr. Legere’s employment by the Company without “cause” or upon Mr. Consistent with the 2003 Agreement. Carey to invest in the same investment options as available under the Company’s 401(k) plan and does not provide for any Company contribution. the Amended 2006 Agreement: (1) provides Mr. he would be entitled to an early monthly pension benefit of (i) $1. Legere in the event of termination of Mr. except with respect to certain rights Mr. Legere had under such prior agreement relating to indemnification. 2009 (the “Amended 2006 Agreement”). $0 $0 $35. 2007 to August 15. (ii) $1. a prorated bonus for the year of termination. Legere’s employment from December 9.407 if he were immediately to separate from the Company and begin to receive benefits. plus certain other benefits and payments. the Amended 2006 Agreement: (1) extends the contractual term of Mr. Legere to reimbursement (on an after-tax basis) for certain excise taxes should they apply to payments made to Mr.134 Of the Named Executive Officers. the Company entered into a new employment agreement (the “Original 2006 Agreement”) with Mr. subject to certain limited exceptions. Legere is entitled to equity grants on a basis no less favorable than grants for other senior executives of the Company and to the vesting in full of all equity grants upon any Designated Termination . duties or positions. No earnings on such deferred compensation are reported in the Summary Compensation Table above.1 million.505 if he were to separate from the Company at or after age 52 and elect to start receiving benefits at any time thereafter or (iii) depending on his years of service with the Company and the age at which he elects to start receiving benefits. and (4) provides the Company with the discretion to pay up to one-half of Mr. Legere by the Company. . and further amended by an amendment dated December 31. Carey participates in a non-qualified deferred compensation plan. Legere’s annual bonus in common shares of the Company. further amended by an amendment dated December 31. Legere’s base salary and target annual bonus. 2012. .

a qualified retirement savings plan. For all termination reasons except involuntary termination for cause. and termination due to change in control. In the case of any such Named Executive officer’s termination. for termination due to death or disability. 39 .” For all termination scenarios. Legere’s employment agreement also provides for 100% vesting of all outstanding stock options and RSUs for all Designated Terminations. voluntary termination for good reason. in addition to the benefits listed under the caption “Payments Made Upon Any Termination” above. he will have 12 months from the date of termination to exercise vested options. a lump sum amount representing a pro rata portion of the current year annual bonus at target. the Named Executive Officer will also receive: • • benefits under the Company’s disability plan or payment under the Company’s life insurance plan. to the extent inconsistent with his employment agreement as described above under the caption “Executive Compensation—Employment Agreement”. and vesting of a pro rata portion of Time-Based RSUs and Performance-Based RSUs. such amounts are not included in the below tables. continued health and welfare benefits for 24 months following termination. in addition to the benefits listed under “Payments Made Upon Any Termination” above. Such amounts may include: • • amounts contributed and vested under the Company’s Employee Retirement Savings Plan (“ERSP”) and the Supplemental Retirement Savings Plan (“SRSP”). the Named Executive Officers (other than Mr. the Named Executive Officers are entitled to accrued vacation time and vested employer and employee contributions to the ERSP. Legere. Legere’s Non-Qualified Stock Option Agreements. he will have 90 days from termination to exercise vested options. which is described in further detail below: • • • • a lump sum cash severance equal to two times the sum of base salary and annual bonus at target. Legere. Unvested stock options and RSUs for all other Named Executive Officers are forfeited upon termination for all reasons except as provided below under the captions “Payments Made Upon Death or Disability” and “Payments Made Upon Change In Control Termination. the Named Executive Officer will be entitled to receive the following items paid in accordance with the Global Crossing Limited Key Management Protection Plan. to the extent inconsistent with his employment agreement as described above under the caption “Executive Compensation— Employment Agreement”). Payments Made Upon Involuntary Not-For-Cause Termination or Voluntary Termination With Good Reason In the event of an involuntary termination not-for-cause or voluntary termination with good reason of a Named Executive Officer (except for Mr. Pursuant to Mr. as appropriate. For all other reasons except involuntary termination for cause. and outplacement services up to an amount equal to 30% of base salary.POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL Payments Made Upon Any Termination Regardless of the manner in which a Named Executive Officer’s employment terminates. Legere) will have 90 days from termination in which to exercise any vested stock options. and unused vacation pay. Payments Made Upon Death or Disability In the event of the death or disability of a Named Executive Officer (except for Mr. on the same terms as are available to employees generally. he will be entitled to receive amounts earned during his term of employment. Mr. his vested stock options will remain exercisable for 180 days from termination. involuntary not-for-cause termination.

or if he or she were to terminate employment for “good reason” (generally. provides enhanced severance benefits for the executive officers and certain other key employees of the Company named in the KMPP. Enright. McShane and Kritzmacher are participants in the KMPP at a “severance multiplier” of two. 2011 to extend the term of the plan to December 31. and was amended on July 30.2 to our Quarterly Report on Form 10-Q for the six months ended June 30. Mr. and all Time-Based and Performance-Based RSUs still subject to restrictions will vest pursuant to the executive’s Restricted Stock Unit Agreement. The actual amounts to be paid out can only be determined at the time of such executive’s separation from the Company.” The amended KMPP was filed as Exhibit 10. involuntary not-for-cause or voluntary for good reason termination. subject to minimum target bonus amounts established for purposes of calculating severance. Their KMPP benefits are included above under “Payments Made Upon Involuntary Not-For-Cause Termination or Voluntary Termination With Good Reason. Potential Payments Upon Termination or Change of Control The tables below reflect the amount of compensation payable to each of the Named Executive Officers of the Company upon voluntary termination without good reason. 40 . 2009 and further amended on April 9. Global Crossing Limited Key Management Protection Plan The KMPP is intended to retain executive officers and other key executives by mitigating their concerns about financial hardship in the event of an involuntary actual or constructive termination without “cause” (as defined in the plan). 2003. 2010. termination due to death or disability. involuntary for cause termination. Specifically. Carey. Legere are detailed under the caption “Employment Agreement” above. Except as noted below. The amounts shown assume that such termination was effective as of December 31. an unfavorable change in employment status or compensation). (iii) continuation of life and health insurance coverages for a number of years equal to the “severance multiplier” and (iv) payment for outplacement services in an amount not to exceed 30% of his or her base salary. in addition to the benefits listed above under the captions “Payments Made Upon Any Termination” and “Payments Made Upon Involuntary Termination Not-For-Cause or Voluntary Termination With Good Reason”. Legere’s severance arrangements are set forth in his employment agreement rather than in the KMPP. the following will occur: • • all outstanding stock options will immediately become exercisable pursuant to the executive’s Non-Qualified Stock Option Agreement. Legere) is terminated as a result of a change in control. payments that would be made upon termination to Mr. 2009. which was originally adopted by the Company on December 9. 2012. Messrs. and thus include amounts earned through such time and are estimates of the amounts that would be paid out to the executives upon their termination. (ii) a prorated portion of the annual target bonus for the year in which the termination occurred.Payments Made Upon Change in Control Termination In the event a Named Executive Officer (including Mr. the KMPP entitles him or her to receive (i) a lump sum payment equal to the “severance multiplier” of one or two times the sum of his or her annual base salary plus target bonus opportunity (reduced by any cash severance benefit otherwise paid to the participant under any other applicable severance plan or severance arrangement). if a participant’s employment were terminated by the Company (other than for cause or by reason of death or disability). The KMPP. and termination following a change in control.

330 — — $ 37. . . . . . . . . . . . .92 as of market close on December 31. . Equity valued using the FMV of $12.179 (1) All benefits are valued as of December 31. . . . Mr. . (6) Assumed to be not in connection with a change of control of the Company that would trigger excise taxes pursuant to Section 280G of the Internal Revenue Code. 41 . . Legere’s employment agreement. . .530 $ 4. . . .John J. . .849. . . . . .724 $ 9. . . Pension Plan .724 — $ 7.275. . . Legere’s employment agreement. .595 $ 7. . . Outplacement Services . (4) Upon termination in connection with a change of control of the Company. .751.000 $ 330. Unvested Performance RSU Awards(2) . . . . . . paid in accordance with Mr.600. . . at target level in accordance with Mr. . . Non-Qualified Savings Plan(3) . . Legere may be subject to certain excise taxes pursuant to Section 280G of the Internal Revenue Code.849. (5) Lump sum cash severance payment of three times the sum of base salary and annual bonus at target and a pro-rated annual bonus at target. . .000 $18. . . . . . . . . . . . .530 $ 4. . . 2010.751. .530 $ 4. . . .700. Mr. . for which the performance periods are ongoing. . Health and Welfare Benefits .000 $ 330. Legere Voluntary Termination without Good Reason on 12/31/2010 Involuntary Termination Not for Cause or Voluntary Termination with Good Reason on 12/31/2010(6) Involuntary For Cause Termination on 12/31/2010 Change in Control Termination on 12/31/2010 Payments Upon Separation(1) Death or Disability on 12/31/2010 Unvested Time-Based RSU Awards . Legere will be reimbursed for all such excise taxes and for any income tax consequences of such reimbursement. .700. .000 $28. .584 — — — — — — — — $— $ 5. . . . . Under his employment agreement. . . . 2010. . . Total . Excise Tax & Gross-Up(4) . . (3) The Non-Qualified Savings Plan represents employee contributions to the SRSP.751. . — — — — — — — — $— $ 5.849. . . .606.330 — — — — — — $10. . . . Cash Severance(5) . . . . .330 — — $ 37. . .668. . . . (2) Amount includes the values of 2009 and 2010 Performance-Based RSUs. .860 $ 5.

.John A. . . . . . (4) Lump sum cash severance payment of two times the sum of base salary and annual bonus at target.500 $ 165. . .184.150 — $2. Equity valued using the FMV of $12.172. Non-Qualified Savings Plan(3) . . . . . prorated to the date of termination. . .436.907 — — — — — — $1. at target levels in accordance with the 2009 and 2010 long-term incentive compensation programs. . and a pro-rated annual bonus at target. . . . . . . . . Pension Plan .443. . .164 $1. . . paid in accordance with the KMPP. . . . . . . . . for which the performance periods are ongoing. . . Health and Welfare Benefits . 2010. Cash Severance(4) . . 2010. and. .172. . .92 as of market close on December 31. . . . . . . . .650 — — — — — — — — $— $1. . . . in the case of terminations due to death or disability. Kritzmacher Voluntary Termination without Good Reason on 12/31/2010 Involuntary Termination Not for Cause or Voluntary Termination with Good Reason on 12/31/2010 Involuntary For Cause Termination on 12/31/2010 Change in Control Termination on 12/31/2010 Payments Upon Separation(1) Death or Disability on 12/31/2010 Unvested Time-Based RSU Awards . . .578 (1) All benefits are valued as of December 31. . . . .448 $ 613. . . . . . .764 — — $ 25. Outplacement Services . — — — — — — — — $— $ 822. . . .000 $2. 42 . . . . .500 $ 165. Total .000 $4.150 — $2. . . . Excise Tax & Gross-Up . . . . . . . . . Unvested Performance RSU Awards(2) . . (2) Amount includes the values of 2009 and 2010 Performance-Based RSUs. . . . . .362. . .990. (3) The Non-Qualified Savings Plan represents employee contributions to the SRSP. . .355 $ — — — — 25.

. Carey Voluntary Termination without Good Reason on 12/31/2010 Involuntary Termination Not for Cause or Voluntary Termination with Good Reason on 12/31/2010 Involuntary For Cause Termination on 12/31/2010 Change in Control Termination on 12/31/2010 Payments Upon Separation(1) Death or Disability on 12/31/2010 Unvested Time-Based RSU Awards . . . at target levels in accordance with the 2009 and 2010 long-term incentive compensation programs. Cash Severance(4) . . (2) Amount includes the values of 2009 and 2010 Performance-Based RSUs. Equity valued using the FMV of $12. . . .134 $ 627. .750 $ 127. . paid in accordance with the KMPP.329.182 — $1. . . .566 $ — — $245.019. . . and a pro-rated annual bonus at target. Health and Welfare Benefits . . . .678. . . in the case of terminations due to death or disability. . for which the performance periods are ongoing. . . . . . . Non-Qualified Savings Plan(3) . . . . .David R. Excise Tax & Gross-Up .134 — $ 20.877 $ 245. .134 — — — — — $1. . . . 2010. . . .500 $4. . . .678. . .902 (1) All benefits are valued as of December 31. . .077. . . .528 $ 870. . . (4) Lump sum cash severance payment of two times the sum of base salary and annual bonus at target. . . . Pension Plan .962 — — $ 245. Total . .92 as of market close on December 31. . . Outplacement Services . . . .808 $ 245. . . . . . . . . .750 $ 127. .134 — — — — — $245. . and. . . . . . . Unvested Performance RSU Awards(2) . . prorated to the date of termination.182 — $1. — — $245. . . 43 . . . . 2010. . . .134 — 20. . . .500 $2. (3) The Non-Qualified Savings Plan represents employee contributions to the SRSP.951 $ 456. .071.134 — — — — — $245. . . .134 $1. .

. . . . — — — $246. . . . .000 $ 120. . . . Excise Tax & Gross-Up . .331. . .92 as of market close on December 31. .077.485 — — — — $246. .528 $ 870. . . . . . . Pension Plan . Non-Qualified Savings Plan(3) . .485 — — — — $1.580. . . . . . . . (3) The Non-Qualified Savings Plan represents employee contributions to the SRSP. .485 $ 25. .808 — $ 246. . . (4) Lump sum cash severance payment of two times the sum of base salary and annual bonus at target. . . . . . .635 $ — — — $246. . Equity valued using the FMV of $12.877 — $ 246. (2) Amount includes the values of 2009 and 2010 Performance-Based RSUs. . . . .Daniel J. . . . . . . . . . .919. . 44 .485 25.580. . Unvested Performance RSU Awards(2) . . . .485 — — — — $246. . . . . Enright Voluntary Termination without Good Reason on 12/31/2010 Involuntary Termination Not for Cause or Voluntary Termination with Good Reason on 12/31/2010 Involuntary For Cause Termination on 12/31/2010 Change in Control Termination on 12/31/2010 Payments Upon Separation(1) Death or Disability on 12/31/2010 Unvested Time-Based RSU Awards . . at target levels in accordance with the 2009 and 2010 long-term incentive compensation programs. Outplacement Services . . . .951 $ 456.485 $ 627.000 $3.971 (1) All benefits are valued as of December 31. . and a pro-rated annual bonus at target. . . Cash Severance(4) .150 — $1. Health and Welfare Benefits . . . . paid in accordance with the KMPP. . .485 $1. . 2010. . . prorated to the date of termination. and.000 $1.313 — — — $ 246. . . . Total .971. 2010. . . for which the performance periods are ongoing. .150 — $1. . .000 $ 120. . . . . in the case of terminations due to death or disability. .

. . .702. . Non-Qualified Savings Plan(3) . McShane Voluntary Termination without Good Reason on 12/31/2010 Involuntary Termination Not for Cause or Voluntary Termination with Good Reason on 12/31/2010 Involuntary For Cause Termination on 12/31/2010 Change in Control Termination on 12/31/2010 Payments Upon Separation(1) Death or Disability on 12/31/2010 Unvested Time-Based RSU Awards . at target levels in accordance with the 2009 and 2010 long-term incentive compensation programs. . . . .560. . — — — — — — — — $— $ 627. .500 $1.422 — $1. 2010. . . . . . Cash Severance(4) . . . in the case of terminations due to death or disability. Equity valued using the FMV of $12. . .084. . . . Pension Plan .877 — — — — — — $1. . . . . and.077. . prorated to the date of termination. 45 . . .422 — $1. . .528 $ 870. . . .250 $ 118. . . . . . . . . . . .John B. . . Unvested Performance RSU Awards(2) . . . (2) Amount includes the values of 2009 and 2010 Performance-Based RSUs. . . . . Health and Welfare Benefits . . .808 — — $ 23.250 $ 118. . paid in accordance with the KMPP. . .500 $3. . . . . . . . . (3) The Non-Qualified Savings Plan represents employee contributions to the SRSP. .92 as of market close on December 31. for which the performance periods are ongoing. .951 $ 456.560. Total . . . . . . (4) Lump sum cash severance payment of two times the sum of base salary and annual bonus at target. . 2010. . . . . . . . . and a pro-rated annual bonus at target.508 (1) All benefits are valued as of December 31.650. Excise Tax & Gross-Up . . .172 — — — — — — — — $— $1. .828 $ — — — — 23. . . . . . Outplacement Services . . .

000 Nominating and Corporate Governance: $10. Messrs.000 Additional Retainer for Government Security Committee Members: $45.000 Executive: $10.250 for each such meeting attended telephonically. although we will reimburse such directors up to $7. in which case he or she receives no additional compensation in the capacity of Executive Committee member) and the Executive Committee in the amount of $2.500 for each meeting attended in person and $1. each chairman of a Board committee and each member of the Government Security Committee also receives annual retainers in accordance with the following schedule: • • • • • Retainer for Members of the Board or Executive Committee: $50. Each non-employee member of the Board and/or the Executive Committee.000 for each meeting of the Board attended in person and $2. In connection with their employment by ST Telemedia and its affiliates.000 Additional Board Vice Chairman Retainer: $25. Lee and Clontz assigned their rights to Board fees and retainers to a subsidiary of ST Telemedia. income tax returns.S.S. withholding taxes.DIRECTOR COMPENSATION Non-employee members of the Board each receive cash compensation of $5.000 (including a tax gross-up) for the costs to engage a tax accountant to prepare their non-resident U.000 In addition.000 Government Security: $10.250 for each such meeting attended telephonically. subject to share availability) Additional Board Chairman Retainer: $50. on the date of each annual general meeting of shareholders.000 Compensation: $15.S.000 Additional Committee Chair Retainers: • • • • • Audit: $30. Each Board member also receives cash compensation for attendance at each meeting of a committee of the Board of which he or she is a member in the amount of $2. 46 . The Company reduces fee and retainer payments to non-U. Each member of the Company’s Executive Committee receives cash compensation for attendance at each meeting of the Board (unless he or she is a Board member.000 (payable one-half in cash and one-half in common shares of the Company.000 based on the closing price of the Company’s common shares on such date. resident directors by the amount of the applicable U. each member of the Board and/or the Executive Committee is granted restricted stock units with one year vesting valued at $80.500 for each meeting attended in person and $1.500 for each such meeting attended telephonically.

. . . Jeremiah D. . . .980 $106. Peter Seah Lim Huat . Sachs . . . . . . . . . . . . . . . . . . . .229 7. . . . . . . . . Except as noted in the immediately preceding sentence. . . . . .980 $106. . . . . .000 $ 97. the fair value of the awards was determined using the valuation methodology and assumptions set forth in footnotes 2 and 16 to the Company’s consolidated financial statements included in its Form 10-K/A for the fiscal year ended December 31. . . . .980 $106. . . . . . . (3) The amount shown for Mr. . . . . . . . . . . . . . . . . 2010 and July 1. . . . . Lambert . . . . . . . . . . . . . .229 7. . . Charles Macaluso . . . . . . . . . . . . . . . . . . . . . . . * 7.980 $106. . . . . . . . . . . . . . . Lambert(4) . . . . . . . . . . . . . . . . Jeremiah D. . . . . .893 Total ($) $253. . . . . . . . . . . . . . . . . . . . . . . .229 7.000* — — — 222. . . . . . . . . . . . . .000* — Reflects shares issuable upon exercise of vested options granted by the STT Shareholder Group in the outstanding common shares of the Company held by the STT Shareholder Group. . . . 2010 vested immediately upon grant. . . . . . . . .000 $125. .980 $176.980 $106. . . . . . . . . . . . . . . . . . . No dividends are payable on RSUs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Robert J. Erkeneff . . . . . . . . . . . . . . . .825 and related tax gross-up payments aggregating $2.229 7. . . .980 $106. . . . . . . . . . . . . Clontz . . 2010. . . . . 2010 will vest in their entirety on July 8. . . . . . . . . .229 7. . . . . . . . . . Erkeneff . . . Sachs . . . . . . . . . . . . . . . . .980 Option Awards — — — — — — — — — — — — Non-Equity Incentive Plan Compensation — — — — — — — — — — — — All Other Compensation ($)(3) — — — — — — — — — — — $6. . . . . . . Clontz(4) . . . . . . . . . . . . . Richard R. . . .229 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .980 $191. . . . . . . . . Archie Clemins . . . . . . . Cromer . . . . . . . . Lodewijk Christiaan van Wachem . Robert J. .000 $131. . . . . .000 $147. . . . Michael Rescoe . .980 $254. . . . .230 $226. but modified to eliminate any reduction in the grant date fair value of the awards for the possibility of service-based forfeiture. . . . . . . . . . . . . . . . . . . Lee Theng Kiat . . . . . . . . . .500 $ 50. . . . . . . . . . . . .250 Stock Awards ($)(1)(2) $106. . . . . . The RSUs granted on July 8. . . . . . . . . . . . . . . . Peter Seah Lim Huat . . . . . . .480 $156. . . Steven T. . . . . . . . . . . . . . . . . .500 $115. .230 $250. . .730 $158. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .229 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . as determined pursuant to FASB ASC Topic 718. . . . . . . . . . . . . Richard R. . .750 $ 51. . . Lodewijk Christiaan van Wachem . .980 $231. . . .980 $106. . . . . . . . . . .250 $143. . (2) The retainer shares granted on February 1. . . . . . . .980 $106. . . . . . . . . Fees Earned or Paid in Cash ($) $146. .Director Compensation Table (a) (b) (c ) (d ) (e) (f ) Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) — — — — — — — — — — — — (g) (h) Name E C Aldridge Jr. van Wachem includes payments for tax services aggregating $4. Archie Clemins .980 $106. . . . . . . . . . . . . . .229 7. . . . . . .480 $221. . . . . . . Clontz and Lambert are members of the Executive Committee but are not members of the Board of Directors. . Cromer . .229 — — 12. . . . . . . . . . . Donald L. . . . Michael Rescoe . .229 7. . . . . . . . . . . .250 $120.980 $245. . . . . . . . . . . 2010 is as follows: Stock Awards Options E C Aldridge Jr. . . .000* — — — 40. . . .980 $204. . . . . . . . . . . .229 7. . .123 (1) The amounts shown in column (c) are the grant date fair values in respect of restricted stock units awarded to each Director. . . . . . . . . . .000 $ 85. Donald L. . . . . .068. . . . . . . . . . . . . . . . 2011. . . . . . . . . . . 47 . . . . . . . . . . . . . . . . . . . . . . . The number of outstanding stock awards and options for each non-employee member of the Board Directors or of the Executive Committee of the Board at December 31. . . . .000 $ 70. . . . . . . . . . . . . . . . . . . . . . . (4) Messrs. . Lee Theng Kiat . . . . . . . . . . .980 $106. . . . . . . . . . . . . . . . Charles Macaluso . . . . . . . .980 $106. . . . .229 7. . . . . . . . . Steven T. . .

.700 $11. . . . . . . .779 $12.176 7. . . .229 836 1. . .501 $82.176 7. Peter Seah Lim Huat .501 $82. .779 $12. . . . . .176 7.501 $82.501 $82. .176 7. .229 836 1. . . . .779 $12. . Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) Retainer Shares Retainer Shares RSU (Time) 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 02/01/10 07/01/10 07/08/10 836 1. . as determined pursuant to FASB ASC Topic 718 (but modified to eliminate any reduction for possibility of service-based forfeiture).700 $11. .The grant date fair value of each equity award granted in 2010 to each non-employee member of the Board Directors or of the Executive Committee of the Board.176 7. . . .779 $12.779 $12. .501 $82. . . . . . . . . . . . . . . Steven T. .501 $82.779 $12.229 $11. . . . . Cromer . . . . . .779 $12. .229 836 1. Charles Macaluso .176 7.779 $12. . . . . . . .700 $11. . . . . Clontz .501 $82. Erkeneff .176 7.700 $11. . . .700 $11.501 $82.700 Lodewijk Christiaan van Wachem . . .176 7. . . Donald L. . . . .229 836 1.779 $12.700 $11. .501 $82. Lambert .229 836 1. Jeremiah D.229 836 1. . was as follows: Award Type Grant Date Grant Amount Grant Date Fair Value of Award E C Aldridge Jr.176 7. .176 7. 48 . Richard R. . . . . . Michael Rescoe . . .779 $12.229 836 1.176 7. .700 $11. .700 $11. . . . .229 836 1.229 836 1. . . Lee Theng Kiat .779 $12. . . .700 $11. . . . . . . Archie Clemins .501 $82. . .501 $82.229 836 1.700 $11.501 $82. Sachs . . . . . . .229 836 1.176 7. . . .779 $12. .700 $11. . Robert J. .

206 686. (2) Reflects shares issuable upon exercise of vested options granted by the Company under the 2003 Global Crossing Limited Stock Incentive Plan. . . John J. . . . . Robert J. .708 24. .1% * * * * 3. Lodewijk Christiaan van Wachem . . .465 24.208 24. .206 273. . . . . . . . . . . Donald L. .368 50. . . .118 171. Kritzmacher .208 25. Peter Seah Lim Huat . . . . . . . .000(2) 987. . . . . Cromer . . . . . . . . . . . . . * 26. . . . . . we include two non-director members of our Executive Committee as well as the executive officers (in addition to the Named Executive Officers) identified in this proxy statement under the caption “Directors and Executive Officers. . . Michael Rescoe . . . . . . . . . Enright . unless otherwise noted. . . .266 27. . Restricted Stock Units Vesting Within 60 days Options Currently Exercisable Within 60 days Total Stock and Stock Based Holdings Owned Shares of Common Stock Percent of Class E C Aldridge Jr.208 13. . Steven T.355 33. .669 * * * * * * * * * * * * 1. . Sachs . (1) Reflects shares transferable upon exercise of vested options granted by the STT Shareholder Group in the outstanding common shares of the Company held by the STT Shareholder Group.208 26. . .769 2. . Carey . . . David R. .208 24. . . . . . . . . .4% Percentage of shares beneficially owned does not exceed one percent. For purposes of this table. . . . . .705 48. . .708 24. . . . . . .208 36. . . . Legere . . . . . . . .404 — — — — — — — — — — — — — — — — — — — — 12.330(2) 65. . . . . .000(1) — 413. . . Richard R. . . Lee Theng Kiat . .355 33. . . .208 244. .116. .265 26. All Directors and executive officers as a group (26 persons)(3) . . . . .698 115. each such shareholder has sole voting and investment power with respect to the shares shown. 2011. . . . . . .208 22. Amounts appearing in the table below include (1) all common shares outstanding as of April 18. . . . 2011. Daniel E. . . .465 24. . .208 24. . . To our knowledge. . . . . Jeremiah D. . . .208 24. . (2) all restricted stock units vesting within 60 days of April 18. . .000(1) — — — 222. Archie Clemins . . . . Erkeneff . .103.769 1. . . . . . . . . . John A. . warrants or other rights within 60 days of April 18. McShane . Clontz . . . . . . . .208 25.” 49 . . . . .266 27. . . .147 120.208 66. . . . 2011. for each director and each Named Executive Officer herein. an individual is deemed to have sole beneficial ownership of securities owned jointly with such individual’s spouse. . .000(2) — 72. . . Charles Macaluso . Lambert . . . . . . . . . . Executive Committee members and executive officers of the Company as a group. . . . . . . . . . .000(2) 50. . . . . (3) For purposes of this table. 2011 and (3) all common shares issuable upon the exercise of options. . . . .208 13. .SECURITY OWNERSHIP Directors and Executive Officers The following table sets forth the beneficial ownership of the Company’s common shares as of April 18. and by all Directors. . . . . . . . . . . . . . . .147 70. .705 48. . . .118 99. . . .000(1) — — — 40. . John B.208 24.

.342.000 common shares into which such Senior Preferred Shares are convertible. . Including the 18. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B shares will be voted in accordance with the majority vote of Series B voting common shares. a wholly-owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940. . As of April 18. 5 to Schedule 13G filed on behalf of such shareholders on February 14. 61. . . . Members of the family of Edward C. . 29.8% — 100% — (1) Based on information provided in Amendment No. 2011 by FMR LLC. Fidelity Mid Cap Stock Fund. . . . 2011. Rhode Island. STT Crossing owned 29. which power resides with the funds’ Boards of Trustees.8% of the common shares outstanding of the Company. . . and is located at 10 Frere Felix de Valois Street. Boston. .000 Senior Preferred Shares were issued and outstanding.342. Edward C. Pyramis Global Advisors Trust Company (“PGATC”). . are the predominant owners. The provisions governing the conversion rights of the Senior Preferred Shares can be found in the “Certificate of Designations” filed as Exhibit 4. .074. is an indirect wholly-owned subsidiary of FMR LLC and a bank as defined in Section 3(a)(6) of the Exchange Act. Johnson 3d. Johnson 3d and FMR LLC. . 2011 and on a Form 4 filed by such shareholders on April 18. .656 48. . . 2011. . . . each has sole dispositive power over 170. .117. through their ownership of voting common stock and the execution of the shareholders’ voting agreement. .904.0% 18. may be deemed to have voting and dispositive power over all such shares. .074. PGATC is the beneficial owner of 170.2 to our 2003 annual report on Form 10-K. under the Investment Company Act of 1940.3% of the outstanding common shares of the Company as a result of its serving as investment manager of institutional accounts owning such shares. Temasek.000. through its ultimate ownership of STT Crossing. Chairman of FMR LLC. . 2011. As of April 18. .904. certain information regarding the beneficial ownership of the Company’s common shares by each person or entity who is known by us to beneficially own 5% or more of our common shares. (2) Based on information provided in Amendment No.656 shares or approximately 14. 02917. . Edward C. (“STT Crossing”) is an indirect subsidiary of Temasek Holdings (Private) Limited (“Temasek”). . Chairman of FMR LLC. . FMR LLC is the beneficial owner of 9.Certain Beneficial Owners The following table sets forth. members of the Johnson family may be deemed.000 Senior Preferred Shares. is the beneficial owner of 8.000. and the funds each has sole power to dispose of the 8.056 shares owned by the funds. as of April 18. with a business address of 900 Salem Street. . . .909 common shares and 18. .000. . of Series B voting common shares of FMR LLC. . Port Louis. amounted to 4. to form a controlling group with respect to FMR LLC. STT Crossing Ltd. .056 shares or approximately 14. . with a business address at 82 Devonshire Street. its ultimate parent entity. . .5% of the common shares outstanding. Temasek expressly disclaims beneficial ownership of such shares. 2011. . Smithfield. Neither FMR LLC nor Edward C. Common Stock Percent Shares of Class Preferred Stock Percent Shares of Class STT Shareholder Group(1) . .6% of the common shares outstanding of the Company as a result of acting as investment adviser to various investment companies registered under Section 8 of the Investment Company Act of 1940. a parent holding company. .000 14. Fidelity Management & Research Company (“Fidelity”). . Accordingly.8% of the common shares as of April 18. . 14 to Schedule 13D filed by such shareholders on April 13. . The Senior Preferred Shares are held by the STT Shareholder Group and are convertible into common shares on a one-for-one basis (subject to adjustment). representing 49% of the voting power of FMR LLC. Johnson 3d. pursuant to Rule 13d-4 under the Exchange Act. the STT Shareholder Group beneficially owned approximately 59.000. . Mauritius. . however. Massachusetts 02109.600 shares and sole power to vote or to direct the voting of 149. Fidelity Management and Research(2) . . 2011. 50 .600 shares or approximately 0. through its control of Fidelity. has the sole power to vote or direct the voting of the shares owned directly by the Fidelity funds. The ownership of one investment company.400 shares owned by the institutional accounts managed by PGATC as reported above. directly or through trusts.000. through its control of PGATC.431 common shares and 18.431 9. . . . .000 shares or approximately 6. Johnson 3d and FMR LLC.

any shareholders who represent not less than 5% of the total voting power of shareholders having the right to vote at the meeting or who are 100 or more in number may requisition any resolution which may properly be moved at a shareholders’ meeting. the shareholders are entitled to elect directors to any Board seats that have ceased being subject to ST Telemedia’s designation rights at the next meeting of shareholders. Seah inadvertently filed late a Form 4 on July 13. for inclusion in our proxy statement and form of proxy relating to such annual meeting. 1st Floor. business address and residence address of such person. 2010 to report the grant of time based restricted stock units on July 8. no officer. SHAREHOLDER COMMUNICATIONS WITH DIRECTORS Our Board has established a process to receive communications from shareholders and other interested parties. These designation rights will in general control the nomination process for such designated members until the STT Shareholder Group’s share ownership percentage in the Company changes. if such person were so appointed. director or 10% or greater shareholder of the Company failed to properly report any purchase or sale of the Company’s common shares. 51 . 1st Floor. All such correspondence should be sent “c/o Secretary” at Wessex House. Hamilton HM12. (iii) the class. any individual Directors or any group or committee of Directors. 2010. Hamilton HM12. 45 Reid Street. series and number of shares of our common shares which are beneficially owned by such person. be required to be included in our register of Directors and officers and (v) all other information relating to such person that is required to be disclosed in solicitations for proxies for the election of Directors pursuant to the rules and regulations of the Commission under Section 14 of the Exchange Act. 2011. as described above. the Board will consider Director candidates nominated by shareholders. Pursuant to Section 87(e) of our bye-laws. Bermuda.SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Based on our records. Under the Bermuda Companies Act. as well as any other Board seats that may cease to be governed by ST Telemedia’s designation rights in the future. To communicate with the Board of Directors. age. together with notice executed by such person of his or her willingness to serve as a Director if so elected. except that Mr. not later than December 31. (iv) particulars which would. with respect to the two Board seats not currently controlled by ST Telemedia’s designation rights. However. A shareholder wishing to move a resolution at an annual meeting is generally required to give us notice of the resolution at our registered office at least six weeks before the meeting. 1st Floor. any Board committee or any chair of any such committee by mail. Shareholders and other interested parties may contact any member (or all members) of the Board. correspondence should be addressed to the Board of Directors or any such individual Directors or group or committee of Directors by either name or title. This notice should state the intention of that shareholder to propose such person for appointment and set forth as to each person whom the shareholder proposes to nominate for election (i) the name. during 2010. 45 Reid Street. Any such proposal must also comply with the other provisions contained in our bye-laws relating to shareholder proposals. (ii) the principal occupation or employment of such person. 45 Reid Street. For a shareholder to nominate a Director for election at the 2012 Annual General Meeting of Shareholders. the STT Shareholder Group has the right to appoint eight of the ten members of our Board of Directors. SUBMISSION OF FUTURE SHAREHOLDER PROPOSALS All proposals of shareholders who wish to bring business before our 2012 Annual General Meeting of Shareholders must be received by us at our principal executive offices at Wessex House. Upon timely receipt of any such proposal. a notice executed by that shareholder (not being the person to be proposed) must be received by our Secretary as soon as practicable and in any event at least six weeks before the meeting at Wessex House. At this time. Hamilton HM12 Bermuda. we will determine whether or not to include such proposal in the proxy statement and form of proxy in accordance with applicable law.

Beneficial owners sharing an address who are receiving multiple copies of proxy materials and annual reports and wish to receive a single copy of such materials in the future will need to contact their broker. bank or other nominee may deliver only one copy of this Proxy Statement and the Annual Report to multiple shareholders who share an address unless that nominee or Global Crossing has received contrary instructions from one or more of the shareholders. surveys. You may read and copy any reports. upon written or oral request. We will deliver promptly. Wessex House. Our Commission filings are also available to the public from commercial document retrieval services and at the web site maintained by the Commission at http://www. However. of Company shares.com. but not the record holder. DELIVERY OF DOCUMENTS TO SHAREHOLDERS SHARING AN ADDRESS If you are a beneficial owner. and material that is unduly hostile. should submit their request to us by telephone at (800) 836-0342 or by submitting a request by e-mail to investors@globalcrossing. business solicitations or advertisements.Bermuda. inquiries or suggestions. Please call the Commission at 1-800-SEC-0330 for further information on the public reference rooms. product complaints. 45 Reid Street. New York.C. April 29. D. Hamilton HM12 Bermuda. threatening. proxy statements and other information with the Commission. New York and Chicago.com or a written request to the Secretary. a separate copy of this Proxy Statement and the Annual Report to a shareholder at a shared address to which a single copy of the document was delivered.gov. 2011 52 .sec. WHERE YOU CAN FIND MORE INFORMATION We file annual. depending on the facts and circumstances outlined in the communication. Illinois. statements or other information we file at the Commission’s public reference rooms in Washington. illegal or similarly unsuitable will not be forwarded to the Board. 1st Floor. or to any individual Directors as appropriate. now or in the future. résumés and other job inquiries. Communications are distributed to the Board.. A shareholder who wishes to receive a separate copy of our proxy statements and annual reports. quarterly and other reports.globalcrossing. your broker. bank or other nominee to request that only a single copy of each document be mailed to all shareholders at the shared address in the future. You may also visit us at www.

if any.C. 2011. an accelerated filer. Yes ‘ No È The aggregate market value of the common stock of the registrant held by non-affiliates of the registrant as of June 30. 20549 È FORM 10-K/A (Amendment No.” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. D. par value $0. every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.01 per share. was 60. ‘ Indicate by check mark whether the registrant is a large accelerated filer.) WESSEX HOUSE 45 REID STREET HAMILTON HM12.UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON.687. DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant’s definitive proxy statement to be issued in connection with the 2011 annual general meeting of shareholders are incorporated by reference into Part III of this Form 10-K/A.01 per share The NASDAQ Stock Market LLC Securities registered pursuant to Section 12(g) of the Act: None. 2010 was approximately $329 million.R. Employer Identification No. outstanding as of February 17. The number of shares of the registrant’s common stock. (Check one): Large accelerated filer ‘ Accelerated filer È Non-accelerated filer ‘ (Do not check if a smaller reporting company) Smaller reporting company ‘ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). . par value $. Including Area Code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered Common Stock. a non-accelerated filer or a smaller reporting company. Yes ‘ No È Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. and (2) has been subject to such filing requirements for the past 90 days. and will not be contained. Yes È No ‘ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site. as defined in Rule 405 of the Securities Act. 2010 OR ‘ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-16201 GLOBAL CROSSING LIMITED BERMUDA (State or other jurisdiction of incorporation or organization) 98-0407042 (I. Indicate by check mark if the registrant is a well-known seasoned issuer.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ‘ No È Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports). to the best of registrant’s knowledge.S. See the definitions of “large accelerated filer. Yes ‘ No ‘ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein.946. 1) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31. BERMUDA (Address Of Principal Executive Offices) (441) 296-8600 (Registrant’s Telephone Number. in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

For ease of reference. In addition. this Amendment sets forth the entire Original Report as previously filed. 2010 filed on February 23. This Amendment does not affect any other section of the Original Report and continues to speak as of the date of the Original Report. pursuant to Rule 12b-15 under the Securities Exchange Act of 1934.2. 32. as amended. 31.1 and 32. Specifically. 2008. each as of the date of filing of this Amendment. 1 to Form 10-K is being filed for the purpose of correcting a typographical error in the Consolidated Statements of Cash Flows included in the registrant’s annual report on Form 10-K for the year ended December 31. this Amendment includes new certifications of our principal executive officer and principal financial officer on Exhibits 31.1. 1 . 2011 (the “Original Report”).2.Explanatory Note This Amendment No. amended only to give effect to the correction discussed above. this Amendment corrects a typographical error in the “Depreciation and amortization” line item in the Consolidated Statement of Cash Flows for the year ended December 31.

. . . . . . . . . . . . . . . . . . . . . . . Item 9A. . . . . . . . . . . . . . . . . . . Item 9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 S-1 F-1 Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 1. . . . . . . . . . . 2010 INDEX Page Part I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 81 81 81 81 Market for the Registrant’s Common Stock and Related Stockholder Matters . . . . . Selected Financial Data . Item 11. . . Item 1B. . . . . . Item 14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Consolidated Financial Statements and Schedule . . . . . . . . . . . . . . . . . . . . Other Information . . . . . . . . . . . . Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 24 40 40 41 41 Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . Part IV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Certain Relationships and Related Transactions. . . . . . . . . . . . (Removed and Reserved) . . . . . . . . . Part II. . . . . . . . . . . . . Executive Compensation . . . . . . . . . . . . . . . . . Controls and Procedures . . . . . . . . . Item 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 12. Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . Item 10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 7A. . . . . . . . . . . . . . . Item 7. Item 8. . . . . . . . . . . . . . . . Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Executive Officers and Corporate Governance . . . . . . and Director Independence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 2. . . Item 15. . . Item 9B. . . . . . Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . . . . . . . . . . . 42 45 48 77 78 78 78 81 Business . . . . . . . . . . . . . . i . . . . . . . . . . Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . . . . . . . . Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Financial Statements and Supplementary Data . . . . . . . . . . . Quantitative and Qualitative Disclosures About Market Risk . . Exhibits. . . . . . . . . . . . . . .GLOBAL CROSSING LIMITED AND SUBSIDIARIES For The Year Ended December 31. . . . . . Legal Proceedings . . . . . . . . . . . Part III. . . . . . . . . . . . . . Item 3. . . . . . . . . . . . . Item 4. . . . . . . Item 13. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 5. . . Item 1A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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a provider of specialist telecommunications services in the U. Latin America and a portion of the Asia/Pacific region. including salaries. We are a global communications service provider. as well as 700 carriers. a company formed under the laws of Bermuda in 1997.”). In addition. (ii) GC Impsat Holdings I Plc (“GC Impsat”). BUSINESS Introduction Global Crossing Limited. “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” “our” and “us” mean GCL and its subsidiaries.com. New Jersey 07932. and (iii) GCL and its other subsidiaries (collectively. wages and profit sharing plans. 45 Reid Street. Our principal executive offices are located at Wessex House. the “GCUK Segment”).K. as amended (the “Exchange Act”). where you can find copies of this annual report on Form 10-K and our quarterly reports on Form 10-Q.” “the Company. Brazilian law requires us to negotiate certain labor terms and conditions. references in this annual report on Form 10-K to “Global Crossing. We offer a full range of data. we employed approximately 5.PART I ITEM 1.” and Note 21. and its subsidiaries (collectively. We deliver converged IP services to more than 700 cities in more than 70 countries.” to our consolidated financial statements included in this annual report on Form 10-K for further information regarding our operating segments. 2006.250 people. Europe. and have 17 data centers located in major business centers. mobile operators and Internet service providers around the world. of whom approximately 98% are fulltime employees and the remaining balance are part-time or temporary employees. Hamilton... Our operations are based principally in North America. They are then submitted to the Brazilian Ministry of Labor for final approval. and to obtain approval of those terms from a majority of our approximately 500 employees in Brazil.” was formed as an exempt company with limited liability under the laws of Bermuda in 2003. other than approximately 34 employees in the United Kingdom (“U. Total consideration for the transaction including direct costs was approximately 52 million pounds sterling (approximately $97 million at the exchange rate at the closing date). or “GCL. We report financial results based on the following three operating segments: (i) Global Crossing (UK) Telecommunications Limited (“GCUK”) and its subsidiaries (collectively.” “we. “Segment Reporting. voice and collaboration services and deliver services to approximately 40 percent of the companies in the Fortune 500. We consider our employee relations to be good.globalcrossing. Florham Park. This segment also includes our subsea fiber optic network. with smaller operations in Europe. Except as otherwise noted herein. During the past five years. GCL is the successor to Global Crossing Ltd. Suite 300. HM 12 Bermuda. all of which we will make available free of charge as soon as reasonably practicable after such reports are electronically filed with or furnished to the Securities and Exchange Commission (the “SEC”). Our principal administrative offices are located at 200 Park Avenue. which represent all our operations outside of the GCUK Segment and the GC Impsat Segment and operate primarily in North America. the “GC Impsat Segment”). See below in this Item 1.K.K. As of February 1. which provide services primarily to customers in the U. 1 . Our Internet address is www. 2011. Item 7. we completed the following acquisitions and dispositions: • On December 12. current reports on Form 8-K and amendments to these reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934. with industryspecific unions. Fibernet is now integrated into the GCUK Segment. the “Rest of World Segment” or “ROW Segment”). None of our employees are currently covered by collective bargaining agreements. we completed the acquisition of Fibernet Group Plc (“Fibernet”). which provide services primarily to customers in Latin America. as well as our proxy statements for our meetings of shareholders. Latin America and a portion of the Asia/ Pacific region.

2007. Business Strategy Our strategy is based on four key elements. Internet service providers. Global Crossing’s strategy is centered on increasing the depth and breadth of value added service offerings that are enabled by our advanced. Finally we use indirect sales channels in the form of master agents and agents to complement our direct sales distribution. we have established a separate division in the Company to help us capitalize on new business opportunities in this area. a leading provider of private telecommunications. First. Our primary method of distribution is a worldwide direct sales force. Fourth. for cash representing a total equity value of approximately $95 million. we seek to leverage our global assets to satisfy communication requirements that are pan-regional in scope. governments. To complement direct distribution. Our targeted government and enterprise customer sectors represent significant market opportunities. continued broadband penetration and increasing usage and demand for video applications and content by both consumers and businesses. 2 . which include international and domestic network service providers. Internet and information technology services to corporate and government clients in Latin America. the U. Overall. In the enterprise sector. Third. We expect the demand for high performance data communications to be driven by the introduction of more powerful computers and software applications. 2010. a provider of high-performance. Under this program. pharmaceuticals. Total consideration for the transaction including direct costs was approximately $27 million. increasing utilization by businesses and consumers of IP based applications. adoption of IP and Ethernet data transport technologies. We expect continued growth in the demand for global bandwidth and IP-enabled solutions due to several significant trends. (together with its subsidiaries. global. maximizing customer loyalty. including $14 million in connection with the repayment of existing debt. In anticipation of this expansion. healthcare and other industries where the adoption of high-performance video applications is accelerating. Second. we focus on companies in the financial services. and increased usage of e-mail. cable TV and satellite TV services. creating opportunities for deepening our penetration in the media and entertainment. we are focused on the following target markets: medium-to-large enterprises including multinationals. IP network and data center infrastructure. facilitating higher download rates. producers. wireless carriers. high-tech. provides us with managed video transport capability in this high-growth market segment. building on the existing customer relationships that Genesis Networks has with broadcasters. we strive to provide unsurpassed customer service. allowing them to address a wider range of geographic and product-related requirements and allowing us to benefit from their considerable distribution capabilities. we have developed alliances with major systems integrators to effectively address the requirements of customers who prefer turnkey or outsourced solutions provided by these industry participants. We also target Web2. (“Genesis Networks”). transportation and distribution. our solutions are based on Internet Protocol (“IP”) and Ethernet technologies that cover the full range of service offerings typically deployed by customers in our target markets. government has traditionally been a large customer of our business in that country and we are expanding our presence in the government market in the U. including globalization. cable providers.K. Inc. In the government sector. our advanced IP and Ethernet solutions are connected with these providers. We now have approximately 60 carriers around the world participating in this program. We also use incumbent and other telecommunications providers as an alternative channel of distribution. as well. which now operates under the name Global Crossing Genesis Solutions. we completed the acquisition of Genesis Networks Inc. outsourcing of data center functionality and the evolution of cloud computing.S. healthcare.0 companies and telecommunication carriers. Our acquisition of Genesis Networks. broadcast and media providers and telecommunications carriers. and content distribution service companies. “Impsat”). On October 29. Our most recent acquisition of Genesis Networks is aimed at developing a broader position in the video transport market.• • On May 9. we completed the acquisition of Impsat Fiber Networks. rich-media and video-based solutions serving major broadcasters. producers and aggregators of specialized programming. which we call the Global Partners Program.0 companies. and research and education industries. Web2.

transport. including the acquisitions of Fibernet and Impsat. We will continue our efforts to maintain a motivated. as we believe that the current economic environment and market demand supports these products. processes and strong customer service. mobile and unified communications. use of alternative termination providers and other traditional means such as revenue assurance and dispute resolution. coupled with our systems. streaming video. music. We will continue to improve our cost structure by aggressively managing operating and third-party access costs. customer migrations. The acquisition of Genesis Networks provides opportunities to attract new customers and expand service offerings into markets that require high-performance. enthusiastic and talented work force to achieve our strategies and support our 3 . We intend to increase our selling efforts on managed solutions. cloud solutions and collaboration services. We also intend to leverage our innovation and focus on IP and Ethernet services to capture customer demand created by the convergence of legacy protocols to fixed. With industry consolidation. We also expect mobile traffic growth to remain strong due to increased adoption of mobile communications. processes and strong customer service. Focus on our Employees and Customers and Selectively Augment our Sales Force. have accelerated the growth of our enterprise and carrier data businesses. bringing new cities on-net and adding new service offerings to our product portfolio. We believe that our existing customer base. Continue to Aggressively Manage Costs and Improve Margins. and extensive network of global suppliers. position us well as a provider of global communications services. For example. We intend to leverage relationships with third-party access providers for our wholesale voice services to help reduce our costs across our product offerings. customers and vendors. our corporate development activities. The competitive landscape in the telecommunications industry continues to change. we expect to experience greater demand from customers seeking network diversity. such as telepresence services offered in conjunction with Teliris and Cisco. We also intend to continue to maintain our network and increase capacity. cinema. redundancy and suppliers that can meet their global requirements. We believe that our growing customer base. wide area network optimization services and enhancements to managed security. including such increases resulting from the accelerating pace of the replacement of traditional cellular phones with bandwidth-intensive “smartphones” and other devices. IP-enabled solutions and hosting capabilities. videoconferencing and other innovations. In addition.voice over Internet Protocol (“VoIP”) services. driving the demand for virtual private networks (“VPNs”) and managed services. we introduced hosting and Ethernet capabilities that we acquired in the Impsat and Fibernet acquisitions in new markets where we have operations. increased usage per mobile connection and increased usage of mobile data applications. and reducing other discretionary sales. We intend to offer substantially all of our service offerings throughout our entire network. coupled with our systems. wireless local area networks. and extensive global network of suppliers. we are well positioned to gain traction in the fast growing video transmission market. gaming. which increasingly rely on packet-based networks such as ours. Leverage our Global Network and Enhance our Service Offerings. government and distance learning. transport and hosting capabilities. general and administrative expenses. such as healthcare. This will be done by network optimization. we expect global enterprises to outsource their networking needs as companies require networks that interact internally. hosting and bandwidth and IP connectivity. infrastructure improvements. video-based delivery. position us as a leading provider of global services. rich-media. In addition. we continue to manage expenditures on discretionary items and control payroll costs by tightly managing employee additions. We believe that our comprehensive network and value-add service offerings position us well to meet the growing demand for complete solutions for outsourcing. Capitalize on Industry Trends to Capture New Demand. as well as with partners. Finally. and we believe we are well positioned to take advantage of these changes. With our latest acquisition of Genesis Networks coupled with our high-quality global IP network. For 2011. we have defined the following operational imperatives that we believe will accelerate revenue growth.

The EtherSphere Service provides virtual connections utilizing Ethernet over our global Multi-Protocol Label Switching (“MPLS”) network. data. We also have selectively strengthened our sales and support staff. respectively. Switched Data Services. enabling customers to build private networks that carry business-critical applications at a wide range of speeds from T1/E1 to 10 Gbps. We intend to leverage our global value-added IP. grouped into the following product lines: Transport and Infrastructure. EtherSphere™ (Ethernet WAN) Service is a point-to-point. point-to-multipoint. Product and Service Offerings The following is a brief description of our key services. We also intend to pursue the extension of our network to offer our growing suite of value-add service offerings to additional markets. the U. cloud services and unique vertical market applications such as broadcast media transport. 4 . data center services. respectively. These services are available between any two points of presence (“PoPs”) on our network. and South America. We also intend to continue to analyze potential acquisition opportunities that would increase our scale and efficiency and/or expand our product sets and network reach. reroute traffic. order new services. Transport and Infrastructure We offer a comprehensive portfolio of transport and infrastructure services globally. Our Metropolitan Access Network capabilities bring our worldwide network service to customer premises in more than 50 major metropolitan markets across North America. multimedia and collaboration applications between two or more locations in 26 countries worldwide. The expansion of our network may occur through ongoing capital expenditures and other organic initiatives.K. Voice Services. Ethernet data center and managed solutions. multinational and regional enterprises and carriers. Our International Private Line Service and Wavelength Services provide secure point-to-point digital connectivity. including the development of a new customer portal that will provide customers with real-time visibility of their network. enabling the transport of voice. These services are built around a streamlined global service delivery model intended to provide outstanding customer service. collaboration services and video transport services. In addition to investing in our core network. systems and tools to better enable our customers to configure and manage our services. Europe. respectively. Enhance our Business Through Opportunistic Expansion. Our uCommand® Web-based network management tool allows customers to securely monitor their voice and data services. both in our indirect and direct channels serving governments. and Media Transport Services. additional service arrangements with other carriers and targeted acquisitions. including data center. Our data center and hosting services accounted for approximately 5%. 2009 and 2008. Our transport and infrastructure and switched data services accounted for approximately 58%. We have adopted a continuous improvement management approach to enhance the customer experience and are investing in processes. Collaboration Services. These product line categories reflect the scope of value-added services we provide to our customers. Overview of Our Business Our services include transport and infrastructure. create utilization reports. we intend to continue moving up the value chain with accelerated investment in managed solutions. 39% and 40% of consolidated revenues in 2010.growing customer base. which in the past have accelerated the growth of our enterprise and carrier data businesses. and multipoint-to-multipoint service of up to 10 Gbps with six classes of service. voice services. Our voice and collaboration services accounted for approximately 37%. 5% and 4% of consolidated revenues in 2010. switched data services. including prompt and accurate provisioning and billing. create and track trouble tickets and perform online bill payment. 2009 and 2008. 56% and 56% of consolidated revenues in 2010. Ethernet Private Line (EPL) is a point-to-point Ethernet enabled private line service with connectivity to more than 30 countries worldwide. Data Center and Hosting. 2009 and 2008.

Our dedicated voice services feature end-to-end service level agreements that apply globally and guarantee service availability along our network as well as through local access circuits.S. WiFi and broadband Internet access while providing end point security policy management. Our feature-rich IP VPN Service provides a single access connection to manage and deliver voice.K. Intrusion Detection. Our managed services include pre-sales engineering and customer premises equipment design. and VoIP Integrity Service which enables customers to monitor and manage their VoIP applications through our suite of Application Performance Management tools. managed network services and legacy frame relay/ATM services. video. which provides always-on. equipment procurement. and Asia. jitter and availability. which provides IP access to our reservation-less audio conferencing service. Hosted IP Telephony (GCUK only): Provides customers with IP telephony services that use softwareenabled switching managed from the core of our network. and traditional voice services. We continue to support a small base of customers for Frame Relay and Asynchronous Transfer Mode (ATM) services. billing and accountability. and can secure and provision direct dial inbound numbers in 25 countries. Our remote access services allow enterprises in each of our segments to extend the reach of their wide area networks for multiple users via remote access through global dial. data and multimedia over a VPN with service level agreements for latency. outbound. VoIP toll-free service from those originating locations that adhere to the North American dialing plan is also available for call termination in the U.S. which give customers visibility into the applications running on their networks. and network monitoring and management. Key features include VoIP Ready Access®. hosted IP telephony. We are licensed to provide outbound calling services to the public switched telephone network (“PSTN”) in 29 countries. the U. VoIP Community Peering. customer care. offered through a strategic relationship with Fluke Networks®. prioritization and performance. ATM service connects customer locations while providing multiple classes of service supporting multiple data applications with diverse requirements for network transport. Our VoIP solutions are offered in a managed or non-managed environment.. These services generated more than 50 billion. Our global voice services include the following: • VoIP Services: We offer a complete VoIP services portfolio replicating the full functionality of our traditional TDM portfolio. providing a single point of contact. Latin America. circuits and services to support the interconnection among U. to meet the calling needs of our customers. Managed Security Services include Firewall. and on-net calling solutions. guaranteed time of installation and mean time to restore. Intrusion Prevention and Network Security Scanning and Analysis providing customers with the expertise and vigilance required to maintain the security of networks connected to the public Internet. Hosted IP Telephony is the first product 5 • . 47 billion and 38 billion minutes of voice traffic carried over our global VoIP network during 2010. dedicated Internet access. Our GCUK Segment provides a specialized UK Government IP VPN. equipment. Our IP services also include dedicated Internet access. which includes inbound. which combines a managed connectivity platform. provisioning and installation. respectively. Voice Services We offer a complete suite of VoIP. 2009 and 2008. which provides true IP-to-IP call flows for VoIP Outbound calls terminating in Global Crossing VoIP Local Services™ local numbers. packet delivery. including IP VPN.Switched Data We offer a full portfolio of switched data services to enterprises and carriers. The service level agreements support three key areas: end-to-end network availability. Government Ethernet local area networks. direct high-speed connectivity to the Internet at a wide range of speeds with connectivity to worldwide domains and peering locations in Europe. Frame Relay provides a reliable data transport network for connecting customer locations requiring partial mesh and hub-and-spoke network applications. IP VPN customers can also take advantage of our application performance management services.

operator assisted. using multi-point bridging to connect multiple sites. reliability and cost savings. voicemail and reporting. a phone. recording and hybrid meetings that combine our audio and video services. web. data and feedback with polling and instant messaging features. headsets. provides toll free access in key business markets worldwide. and security services to manage mission critical applications. 6 . applications management. share presentations with participants and record entire meetings. and an Internet connection. Railnet (GCUK only): Railnet is a fully managed voice service provided to the U. including visuals. long distance. or by being dialed out to by an operator.under our Unified Communications suite and provides a platform on which future products will deliver integrated unified communications.S. presentations. Rail Industry over our core network and offers enhanced telephony. applications. Europe and the U. Users are offered a range of handsets. change account options. Participants can access this service by dialing in on either a toll or a toll-free number. • • • Data Center and Hosting We offer enterprise and carrier customers a set of data center and collocation services. video. full-service conference calls.K. We can support toll free applications in Europe and North America. our on-demand/reservationless audio conferencing service. that offer hosting services together with our broadband services and advanced value added solutions. This service is suitable for as few as three or up to thousands of participants. taping/transcription service. eMeeting is a full-featured Web conferencing application that allows customers to collaborate and share documents. • Traditional Voice Services: Our traditional voice services provide the ability to place in-country. allowing customers to manage their calls on-line. • Collaboration Services We offer a comprehensive suite of audio.K. Our iVideoconferencingSM offering sends ISDN calls onto our IP network. which include the following services: • Audio Conferencing: Ready-Access®. business continuity. Videoconferencing Services: Provides video over IP and integrated services digital network (“ISDN”) platforms. • Data Center Services: We operate 17 data center facilities in Latin America. to more complex managed solutions. collaboration services. minimizing dependence on international ISDN lines for superior quality. These facilities offer a complete set of data center services ranging from housing and hosting. translation services and on-line participant lists. Enhanced options available with our videoconferencing services include scheduling. and classes of service. Web Conferencing: Ready-Access Web Meeting is fully integrated with Ready-Access audio conferencing for on-demand collaboration. including disaster recovery. Enhanced service options include PostView® conference playback. We have integrated Ready-Access as an audio conferencing component into Live Meeting. Switched access services are available in the U. Event Call provides highly reliable. and indirect access services are available in the U.S. Global Crossing Live Meeting uses technology licensed from Microsoft® to allow multiple attendees to participate in meetings using only their computer. presence and collaboration services. and international calls via traditional TDM-based connections. Telepresence with Teliris and Cisco: Telepresence solutions. offered with Teliris and Cisco. comprise a set of highly integrated technologies and engineered environments that enable very high quality videoconferencing capabilities. and local service in 48 major metropolitan markets throughout the United States via our competitive local exchange carrier (“CLEC”) footprint.

49% and 47% 7 . and telecommunications carriers. stability and security for critical network requirements. • • • • • Our ROW Segment and GC Impsat Segment enjoy large customer bases with no material concentration of revenues in any one customer or group of related customers. federal solutions sales channel.. we offer the value add managed video transport services that are in high demand from major broadcasters. Federal Solutions Sales Channel: Through the U. Global Enterprise Indirect Sales Channel: Through the indirect enterprise sales channel. we focus on local. we have approximately 60 carriers and alternate service providers in our Global Partner Program using our Fast Track Services™ to support their own enterprise customers. Genesis Solutions Sales Channel: This channel provides high-performance. video and Web-based conferencing services and collaboration solutions to multinational and national mid. U. transportation and distribution. service providers. in the mid to large size segments and higher educational institutions. producers and aggregators of specialized programming. using dedicated sales and support personnel. broadcast and media companies.K.K. At this time. In addition. Our ROW Segment. GCUK Segment and GC Impsat Segment target the following sectors: global multinational corporations. providing next generation IP services. wireless. national and global cable.S. Collaboration Sales Channel: This channel is used to offer audio. Collocation delivers improved provisioning speed. we operate a Global Partner Program that targets incumbent carriers and alternate service providers around the world as an indirect distribution channel. producers and aggregators of specialized programming.K. governments. we target national and local government organizations in the U. This channel serves many of the world’s major broadcasters. research and education and systems integrators. wireline.• Collocation Services: We operate collocation facilities around the world which allow for the placement of customer equipment within certain Global Crossing PoPs to interconnect with our IP network or fiber-optic backbone. various agencies of the U. Government together represented approximately 51%. We have sales and sales support personnel in 26 countries. healthcare/ pharmaceuticals. managed video transport solutions. government sales channel.S.to large-sized businesses. systems integrators and application service providers. The following are our sales channels. each of which targets customers in North America. Media Transport Services With our recent acquisition of Genesis Networks. security and collaboration solutions. and content distribution. Web 2. Carrier Data Sales Channel: Through the direct carrier data sales channel. Carrier Voice Sales Channel: Through the carrier voice sales channel. Government Sales Channel: Through the U. Sales and Principal Customers We are focused on the following target markets: multinational enterprises. we target master agents.S. U. governments. financial services. we target carrier and reseller customers predominantly in the United States for the provision of domestic and international long distance voice services. government agencies and offer them IP.0 companies. resellers and carriers. Latin America and a portion of the Asia/Pacific region: • • • Global Enterprise Direct Sales Channel: Through the enterprise sales channel.K. Although our GCUK Segment also enjoys a large customer base. we target U. leading sports networks. we target multinational and national businesses. secure network services and managed voice services. high-tech. Europe.

switching and routing equipment (the “GC Fiber Network”) provides seamless. In addition to the DWDM equipment. This network has approximately 70 Regional PoPs. we operate (and generally own) the network transmission. data and private line services over our IP.” Our Network Our network consists of a series of assets and rights that allow us to operate service platforms enabling the delivery of various protocol-based data and voice services in major business centers throughout the world. data and private line services over IP.5 and 10 Gbps DWDM transmission systems. We refer to the portions of our leased network over which we have this degree of control.” The Core Network has approximately 800 PoPs in approximately 400 cities in approximately 46 countries worldwide (“Regional PoPs”). respectively. See Item 1A. data.5. and ATM backbones. all traversing 2. four subsea cable landing stations and five primary international voice gateway sites. This network has approximately 390 Regional PoPs and carries voice. all traversing DWDM and SDH transmission systems. together with the GC Fiber Network. The North American network portion of the GC Fiber Network comprises approximately 18. synchronous optical network (“SONET”). we lease rights (such as wavelengths) on other carriers’ fiber-optic cables on a non-IRU basis. The U. The North American network carries voice. IP. In addition to the GC Fiber Network. providing seamless services to the rest of the Global Crossing network. data and private line services over our IP. Ethernet and voice traffic. the Regional PoPs generally house add/drop multiplexer equipment that combines lower speed private line. The GCUK portion of the GC Fiber Network comprises approximately 9. Ethernet and ATM/Frame Relay backbones. most of which consists of IRUs in fibers purchased from other carriers. video and computer data at the same time over one high-speed digital/optical line.5 miles of approximately two-thirds of Britain’s business infrastructure. national and international networks and metropolitan networks. all traversing 2. These fiber optic assets and related transmission. Ethernet. as the “Core Network. Ethernet.800 route miles of fiber and comes within 1. network also encompasses nine major metro markets and reaches 55 smaller towns and cities.of the GCUK Segment’s revenues in 2010. We monitor network performance using a suite of operational support systems to provision and maintain this network worldwide. “Risk Factors—Many of our most important government customers have the right to terminate their contracts with us if a change of control occurs or to reduce the services they purchase from us. We are required to obtain rights of way (or their equivalents) necessary for our fiber-optic cable lines to pass through property owned by both private and public entities. In certain cases. 20 integrated service platform sites.S. 2009 and 2008. South America. SDH (which is a transmission format similar to SONET) and ATM backbones. It has approximately 189 Regional PoPs. and Canada.000 route miles of fiber in the western region of the continent. The European network carries voice. which we either own or hold under long-term indefeasible rights of use (“IRUs”) from other carriers. 8 . These Regional PoPs house dense wave division multiplexing (“DWDM”) equipment that combines multiple colored wavelengths (or channels) on a single fiber and transports them as multiple signals across the network. six cable landing stations.000 route miles of fiber in the U. SONET and ATM are methods of sending audio.K. most of which are contained in cable that we own. At the base of our network are subsea and terrestrial fiber-optic cables that connect and cross North America. 10 and 40 Gbps DWDM systems. The European network portion of the GC Fiber Network (excluding the GCUK portion) consists of more than 14. and two international voice and three international data gateway sites. switching and routing equipment that provides us with the ability to monitor and manage traffic over these leased facilities. Europe and a portion of the Asia/Pacific region. broadband connectivity to 32 countries through a combination of subsea cables.

Taiwan. long haul networks across Argentina. voice can always have priority over IP VPN and Internet traffic. which allows different types of data to be assigned different priorities. Hanoi.S.600 route miles.K. which are leased network and router infrastructure built to our specifications and under our direct operational control. a former subsidiary of the Company and now a subsidiary of NTT Communications Corporation (“PCL”). such that. and leased submarine capacity to link South America to the United States. In the aggregate.500 mile terrestrial route connecting Argentina and Chile. Having a global ASN allows us to deploy certain technologies. Pan American Crossing (“PAC”) and an approximately 314 route mile system connecting the U. for example. Together. the GC Impsat Segment’s long-haul and metro networks connect more than 700 customer locations. South America and Europe. Taipei. and our Latin America assets. Tokyo. more quickly and on a global basis. At approximately 4. The deployed facilities include 15 metropolitan area networks in the largest cities of the region. Our IP network uses a MPLS Juniper core with a mixture of Cisco. SAC is a 12. The North 9 . to this region include both IRUs and leased circuits on multiple subsea systems. South American Crossing (“SAC”). Vietnam. approximately 35 of which contain a VoIP presence and approximately 117 of which have public or private interconnects. of which approximately 42 Gbps is IP VPN and 50 Gbps is voice traffic.The subsea portion of the GC Fiber Network consists of six fiber-optic cable systems owned by us: Atlantic Crossing -1 (“AC-1”). these subsea cable systems span approximately 39.700 Gbps weekly of total IP traffic. in the following locations: Seoul.400 route mile sub-sea system. and we completed the extension of our PAC system to Costa Rica in 2008. and Bangkok. Atlantic Crossing-2 (“AC-2”). Malaysia. Kuala Lumpur. The GC Impsat Segment’s network carries voice. These systems include 14 Regional PoPs in the Latin America and Caribbean regions. data and private line services over IP. and Ireland.000 route miles that connects more than 250 cities. We have approximately 217 distinct IP hubs. Indonesia. We operate our Core Network from four primary network operations centers. 20 and 40 Gbps DWDM transmission systems. Chile and Colombia.400 route miles in 15 markets. averaging approximately 1. The single ASN implies a greater degree of integration than that which exists in a multiple ASN system. The network transmits approximately 3. or approximately one-third of the total voice minutes. SDH and ATM backbones. These are all two or four fiber strand pair cables equipped with 10. networks.300 mile terrestrial ring route (including associated backhaul) within Mexico. Manila. the Philippines.S. with Hong Kong also supporting VoIP services. PAC is integrated with a 2. The GC Impsat Segment also operates a set of metro networks that covers more than 1.17 billion minutes of VoIP per month. Each of these PoPs supports Internet access. The network is considered a Tier 1 backbone and is quality-of-service enabled. Our VoIP platform is fully compatible with our TDM network. Singapore and Sydney. a route that is experiencing acute demand growth and increasing capacity scarcity. Our IP network consists of a service layer running on the Core Network and uses a single Autonomous System Number (“ASN”). In addition. The GC Impsat Segment’s portion of the GC Fiber Network comprises a multiple strand long-haul fiber network of approximately 8. ATM and Frame Relay services. The Global Network Operations Center in London manages our subsea cable systems and our European and U. which is owned by Pacific Crossing Limited. all traversing 2. Juniper and Brocade devices at the edge of the network. Korea.000 route miles and have approximately 24 landing points on three continents: North America. Thailand. Our network assets in the Asia/Pacific region and those connecting the U.K. including an approximately 2. MAC provides a strategic gateway between the Eastern Seaboard of the U. Ethernet. It also provides our international customers with a more global appearance in the global Internet routing table. IP VPN. SAC connects major markets throughout Latin America and is one of only two sub-sea systems currently in operation that circumnavigates the majority of South America. Our Core Network includes IRUs and leases of trans-Pacific capacity on the PC-1 fiber-optic cable system. Inc. Mid-Atlantic Crossing (“MAC”). Jakarta. We operate Regional PoPs in Hong Kong. AC-2 consists of two fiber strand pairs in a cable containing four fiber strand pairs that was co-built with Level 3 Communications. such as MPLS.5 and 10 Gbps DWDM transmission systems. we operate virtual PoPs. Brazil.

resulting in a significant expansion of worldwide network capacity. logical and network security and personnel screening and training. Michigan. 2007 to clarify that the U. 2003. Competition The telecommunications industry is intensely competitive and has undergone significant changes in recent years. communications. and (iii) to satisfy U. Our compliance with the Network Security Agreement is subject to annual audits by a neutral third-party auditor.S. the U. at least in the short-term. a number of new competitors entered the market and commenced network construction activities. In order to comply with the Network Security Agreement. we deliver services to hundreds of additional cities worldwide through arrangements with other carriers. Arizona. In addition. it became clear that.S. Government granted approval under Section 721 of the Defense Production Act of the investment in GCL by Singapore Technologies Telemedia Pte Ltd (“ST Telemedia”) pursuant to the plan of reorganization of our predecessor and a number of its subsidiaries (the “GC Debtors”). citizens and who already possess or are eligible to possess a U.S. The Network Security Agreement also includes corporate governance obligations. In connection with the acquisition of Impsat. which emerged from reorganization on December 9. a service that Impsat’s U. resulting in 10 .S. 2003. Government’s ability (i) to carry out lawfully authorized electronic surveillance of communications that originate and/or terminate in the U. manages the global IP and Frame Relay/ATM networks. Government to address the U. The Network Security Agreement is intended to ensure that our operations do not impair the U. New Jersey that provides redundant IP and ATM network management capability. traffic routing and management.S. operating subsidiaries. At least half of the members of our board nominated by ST Telemedia must be Security Directors. In order to obtain this approval. A Security Director must be present at every meeting of the board of directors of GCL (including any committee thereof) and of any of our U. The Global Data Services Network Operating Center. critical infrastructure protection requirements. the Network Security Agreement was amended on February 1. Together with those locations connected directly by the Core Network. we entered into an agreement (the “Network Security Agreement”) with certain agencies of the U. Beginning in the late 1990s.S.S. The GC Impsat Segment’s network operations center located in Buenos Aires manages all of that segment’s networks. we have a small network operating center in Newark.S. Government’s national security and law enforcement concerns.America Network Operations Center. actual demand was failing to keep pace with available supply. security clearance.S.S. in each case unless such meeting in no way addresses or affects our obligations under the Network Security Agreement.S.. operations of Impsat are subject to the terms of the agreement. These audits have not reported any areas of material non-compliance with the Network Security Agreement. operations had been engaged in to a limited extent prior to the acquisition. Network Security Agreement On September 23. In 2001. To satisfy these.S. Failure to comply with our obligations under the Network Security Agreement could result in the revocation of our telecommunications licenses by the Federal Communications Commission (“FCC”). located in Phoenix. physical. manages the global voice network and the North American transport network. These “Security Directors” must satisfy the independent director requirements of the New York Stock Exchange. the GCL Board of Directors maintains a Security Committee comprised solely of directors who are U. Such amendment also expanded the scope of the Network Security Agreement to include data hosting. (ii) to prevent and detect foreign-based espionage and electronic surveillance of U. regardless of whether any of GCL’s securities are listed on such exchange. we have undertaken a number of operational improvements related to information storage and management. located in Southfield.

As we accelerate our investments in managed security.. At the same time. and expect to continue to face. as the competitive landscape continues to change with industry consolidation.S. and service quality advantages over some existing incumbent carrier networks. and a supplier that can meet their requirements worldwide. Telstra. the regulatory environment has changed and continues to change rapidly.S. This “technologically neutral” approach to regulation has opened the market to new. have blurred the distinctions among traditional communications markets and have reduced barriers to entry in various lines of business. our network architecture and technology may provide us with cost. including us. an unsustainably low ratio of revenues to fixed costs. The following summarizes the competition we face in all of our operating segments by type of competitor.S. quality. Since then. However. Telefónica. together with new technologies. and significantly larger installed customer bases. compared with some of the networks of the incumbent carriers. and the importance of data services. transport and hosting capabilities. capacity and reliability of network facilities.. national regulatory authorities are considering policies that would exempt VoIP services from many of the traditional forms of regulation. we expect to experience greater demand from customers seeking value-added IP. including companies such as British Telecom (“BT”). competition has remained intense and pressure on price and margin has continued. such as VoIP. SAB de CV (“Telmex”) and Deutsche Telekom. Efforts to liberalize markets around the world have produced similar results. In the U. Teléfonos de México. the new regulatory framework adopted by the European Commission attempts to treat all communications markets the same regardless of the technology used to serve the market. unified communications and cloud solutions. Incumbent Carriers In each market that we serve. On the other hand. Many of these advantages have increased through consolidations by large industry participants. price. with significant improvements to their financial condition or as newly formed entities that have acquired the assets of others at substantial discounts relative to their original cost. name recognition and financial. route diversity. Because our fiber-optic systems were installed relatively recently. inside the U. Qwest Communications Corporation (“Qwest”) and AT&T. In Europe. we face. capacity. significant competition from the incumbent carriers that currently dominate local telecommunications markets. more ubiquitous network reach. Many of our existing and potential competitors have significant competitive advantages. We face competition both outside and. processes and strong customer service. from foreign incumbents. Although the Telecommunications Act of 1996 (the “1996 Act”) and actions by the FCC and state regulatory authorities have had the general effect of promoting competition in the provision of communications services in the U. superior engineering and marketing capabilities. under bankruptcy and insolvency laws. Telecom Italia. non-traditional competitors. these effects. in some cases. We compete with incumbent carriers on the basis of product offerings. completed reorganizations. In Asia and Latin America. ease of ordering and customer service. particularly new providers.intense price pressure and. the incumbent carriers may have long-standing 11 . these are primarily Verizon. data center and managed solutions. Our existing customer base. During the ensuing five years. technology. decreased precipitously as the financial condition of many carriers deteriorated. technological and personnel resources. including greater market presence. coupled with our systems. position us as a competitor in the global services marketplace. France Telecom. a number of these companies. Ethernet. and extensive network of suppliers globally. in many cases. we also will face increased competition from system integrators such as HP/EDS and Accenture as they compete with us for these services contracts through their own offers or through partnerships with incumbent carriers. Market valuations of debt and equity securities of telecommunications companies. despite certain regulatory changes or conditions implemented in response to such consolidation in order to mitigate the impact on non-dominant carriers such as ourselves.

but new entrants are making gains as telecommunications regulations and competition rules become more supportive of competitive entry. and authorizations in the ordinary course of business. Other Voice Service Competitors In the U. In addition. we face. Savvis and Terremark. Other Data Service Competitors In addition to the incumbents. 12 . DSL service providers. and expect to continue to face. competition for Internet access and other data services from telecommunications companies such as Cable and Wireless plc. cable companies. regulatory protection from competition. in the case of many foreign incumbents in their home markets. and expect to continue to face. In addition to telecommunications licenses and authorizations. the conditions governing our service offerings remain subject to future legislation or regulation that could materially affect our business and operations. The construction and operation of our facilities and our provision of telecommunications services may subject us to regulation at the national..S. we may be required to obtain environmental. Other Conferencing Competitors In addition to competitors that provide voice and data services generally. In their own primary markets.relationships with their customers and provide those customers with various transmission and switching services that we. we face. cable television companies.S. and authorizations. and Telefonica and IT services providers such as IBM. Colt Telecom Group plc. HP and CSC. competition for local and long distance voice telecommunications services from CLECs. Inc. While we believe that we have received all required authorizations to offer our services in the countries in which we operate. video and Web conferencing services. control over local exchange assets. the local incumbents dominate the market for local voice services and are among the strongest competitors in the long distance voice services market.. construction. and VoIP service providers that compete in the local and long distance marketplace in the U. such as InterCall. BT Global Services (a unit of BT). Colt Telecom Group plc. and hosting providers such as Rackspace. (a division of West Corporation) and Premiere Conferencing. our conferencing business competes with companies that specialize in providing audio. BT Global Services (a unit of BT). Other Genesis Solutions Competitors Our Genesis Solutions business competes with companies that specialize in providing video transport services. provincial. and local levels. Outside of the U. significant existing customer bases and. as well as rights of way (or their equivalents) necessary for our fiber-optic cable lines to pass through property owned by both private and public entities. licenses. ISPs and Web hosting providers. XO Communications and Level 3 and from online service providers. Verizon. do not currently offer. state.S. licenses. the local incumbents dominate the markets for local and long distance voice services. Such regulation requires us to obtain a variety of permits. such as incumbent fiber provider Vyvx (a division of Level 3 Corporation) and origination providers such as Globecast. in many cases. Regulatory Overview The construction and operation of our facilities and our provision of telecommunications services subject us to regulation in many countries throughout the world. Other Data Center Services Competitors Competition for data center services includes many players—incumbent telecommunications companies and network service providers such as AT&T. zoning and other permits. Orange Business Services (a unit of France Telecom). the incumbents have the additional advantages of network concentration.

we incur both usage-sensitive as well as facility charges and together they can comprise a significant majority of the cost associated with serving a particular customer. and Latin America. North American Regulation Regulation in the U. For the provision of voice service.K. “Risk Factors—We may not be able to continue to connect our network to incumbent carriers’ networks or maintain Internet peering arrangements on favorable terms. as amended.” or “leased lines” and collectively referred to as “facility” charges. is the primary legislation governing our provision of interstate and international services. the ROW Segment is subject to regulation in the U. As a Tier 1 Internet backbone operator. regulators have the authority to revoke our operating license. We face facility charges for virtually all of our services and facility charges alone can comprise a significant majority of the overall cost associated with serving a particular customer. grouped by region. Importantly. acquisition and operation of our U. In addition. we generally do not currently pay transit charges to other Internet backbone operators. For instance. regulators establish the price at which we pay other carriers for the termination of voice traffic.” Below is a summary of the regulatory environment in the principal countries in which we operate. it will have a significant impact on our cost structure and our ability to effectively compete in the market for IP transit. We have authority from the FCC for the installation. These prices are typically fixed per unit of capacity and are commonly referred to as “special access. The cost to access local exchanges is our 13 . Regulators also regulate the price we pay for “last-mile” connections that connect our network to our customer’s premises or to another carrier’s network. See Item 1A.. our facilities and services are subject to regulation at both the federal and state level. U. mainland Europe and Asia. Internet access. and other services that are supported through Internet peering arrangements. Regulators regularly evaluate the price level and structure of usage-sensitive and facility charges and any changes can have a significant impact on our cost structure. but should that change for any reason. These prices are typically stated as a price per minute and are known as usagesensitive charges.If we fail to conform our operations to applicable regulations. “LECs”) charge us for access to local exchanges. The Communications Act of 1934. the construction and operation of our facilities.S. regulators do not currently regulate prices related to peering or transit arrangements established for the exchange of Internet traffic. and Latin America to the extent of its limited operations in those jurisdictions. Regulators also regulate the price for certain telecommunications services that are essential to our provision of service to our customers. respectively. State communications and/or public utility statutes govern our intrastate operations.S. Our GCUK Segment and GC Impsat Segment are subject to the regulatory regimes in the U. depending on the location of the customer and the customer’s traffic profile. Regulation of the Cost of Access The FCC and the states regulate the rates that incumbent local exchange carriers (“ILECs”) and CLECs (together with ILECs. Regulators can impose monetary fines that can range from nominal to material depending on the nature of the violation. Regulators can impose additional reporting requirements on us and otherwise subject us to auditing and oversight measures. Federal Regulation The FCC exercises jurisdiction over our interstate and international services and. to some extent.K.” “local loops. the relevant regulators have the authority to impose a range of penalties on us. network and for the provision of international facilities-based services. Ultimately.S. The ROW Segment is subject to regulation primarily in North America.S. forcing us to cease operations in the relevant jurisdictions. Regulators also can require us to make changes to our operational processes to come into compliance with relevant requirements. In the U.

Should the FCC modify regulations governing special access. ILEC Switched Access Charges The LECs assess usage-sensitive switched access charges for the use of their switched facilities to originate and terminate switched traffic. although smaller ILECs and some CLECs continue to assess it. usage-sensitive rates were decreased over time in favor of increases in end-user charges and a transitional preferred interexchange carrier charge. principally long-distance. carriers to transport and terminate our traffic. This results in a high rate of billing disputes involving large sums of money between carriers that often times only get resolved through litigation. ILEC Special Access Charges Special access services refer to dedicated transport circuits that telecommunications carriers use to connect two points. There is a significant amount of litigation related to the cost of access across the industry. AT&T petitioned the U. CLEC Access Charges CLECs currently serve between ten to twenty percent of access lines nationwide and generally have a larger presence in the enterprise market than the consumer market.S. The ILECs have been granted Type I (or the more limited form of pricing flexibility) in most MSAs in the country and have been granted Type II pricing flexibility in a lesser number of MSAs. Prior to the 2006 FCC-approved merger of AT&T and BellSouth. Although the Court declined to grant the petition. dispute resolution. We also may enter into carrier-to-carrier contracts with other. it could materially impact our operations and cost of service. the FCC regulates ILECs as dominant carriers. We utilize special access services to connect our PoPs to customer locations.single largest expense and can have a significant impact on our operations. Unlike the ILECs. and litigation is increasing for the industry as a whole (including us). Access charges that LECs impose upon us consist of both usage-sensitive switched access charges and flat-rated transport and special access charges. The FCC could elect to take no action and leave the status quo intact or the FCC could elect to modify regulations governing special access. The CALLS Plan expired in 2005 and the FCC is considering proposals to govern access charges prospectively (see “—Intercarrier Compensation Reform” below). This proceeding is still ongoing and we cannot predict its outcome. However. enabling the delivery of services. The cost of bill reconciliation. Under the Special Access Pricing Flexibility Order. The FCC currently regulates ILEC flat-rate transport and special access charges under the terms of its Special Access Pricing Flexibility Order. margins and profitability. Court of Appeals for the District of Columbia Circuit to compel the FCC to consider a proposal to tighten its regulation of ILEC special access services. Regulation of the cost of access also applies to us in those states where we operate as a CLEC. a CLEC may charge the full benchmark rate even where it only provides a portion of the access service 14 . the FCC regulates the CLECs as non-dominant carriers. Under the CALLS Plan. The complex regulatory structure governing the cost of access in place at both the federal and state levels and the difficulty of having such regulations keep pace with technological and service advancements create a high level of uncertainty and a fertile ground for rate arbitrage. ILECs are afforded two different levels of pricing flexibility depending upon the extent of deployment of alternative facilities within particular Metropolitan Statistical Areas (“MSAs”). The price of special access impacts our operations and cost of service. The LECs’ preferred interexchange carrier charges have decreased over time and most of the largest ILECs have ceased assessing this charge. In 2000. in January 2005 the FCC released a Notice of Proposed Rulemaking to consider how it should regulate ILEC special access services prospectively and whether it should tighten its regulation of special access services. adopted in 1999. With respect to their access services. the FCC established a regime to govern the provision of switched access services by the ILECs over a five-year period (the “CALLS Plan”). These latter arrangements are typically not subject to tariff regulation. The FCC permits a CLEC to file tariffs for its interstate access services so long as the CLEC’s rates do not exceed the rates of the ILEC that provides service in the territory that the CLEC services.

Wireless carriers may not file tariffs for their putative access services and must. the local reciprocal compensation rates are being examined in the FCC’s Intercarrier Compensation proceeding (see “—Intercarrier Compensation Reform” below). Because the rates for local reciprocal compensation can be significantly lower than rates for switched access. enter into voluntary contracts in order to assess access charges upon potential access customers. Intrastate access 15 . The FCC ruling applies to all VoIP services that can both receive calls from and terminate calls to the PSTN. All of these actions have increased the cost to provide VoIP services and subjected VoIP providers (including us) to additional regulations and reporting requirements. The FCC also permits CLECs to aggregate the traffic of other carriers. In June 2006. the FCC issued an order holding that interconnected VoIP providers must contribute to the federal universal service fund. The FCC has also recently held that its customer proprietary network information rules apply to VoIP carriers.S. See also “—Intercarrier Compensation Reform” below. Although certain LECs have elected to have intrastate access rates mirror interstate access rates. The FCC has established the general framework governing the level of such compensation. Wireless Access Charges The FCC has adopted a mandatory detariffing regime for access services that wireless carriers wish to provide. although. there is a high volume of billing disputes and litigation throughout the industry. We provide VoIP services on both a wholesale and retail basis while also maintaining legacy TDM services. See also “—Intercarrier Compensation Reform” below. the FCC concluded that VoIP service providers must support enhanced 911 emergency services or cease marketing VoIP services in areas where they cannot be supported. the FCC has now extended to VoIP providers obligations to provide local number portability. The FCC has addressed the subject of the jurisdictional nature of access charges and certain duties applicable to VoIP traffic in response to a number of petitions for declaratory ruling (or comparable petitions).. the CLEC is only permitted to charge for those portions of the access service it actually provides.e. the potential for wireless access charges poses a risk to our cost structure. These rates vary from “bill-and-keep” to rates that approximate those for switched access. in this circumstance. Regulation of VoIP Traffic VoIP services are a form of communications services that utilize the IP standard instead of the legacy TDM technology. The U. toll-free calls originating from wireless subscribers. make their services accessible to persons with disabilities.g. The FCC has also issued a Notice of Proposed Rulemaking seeking comment on how it should regulate VoIP traffic prospectively. the FCC also concluded that VoIP service providers must comply with the Communications Assistance for Law Enforcement Act and configure their network and services to support law enforcement activity in the area of wiretaps and call records. In September 2005. e. As is the case with access charges. intrastate access rates are typically higher (often.involved. Local Reciprocal Compensation Local telephone companies that originate traffic that is terminated on the networks of other local carriers typically compensate the other local carriers for terminating that traffic. In addition. i. In June 2005.. Court of Appeals for the District of Columbia Circuit upheld the FCC’s actions in both cases. As the volume of wireless traffic increases. Intrastate Access Charges Intrastate access charges that LECs assess upon us (or that our CLECs are permitted to charge) are regulated by the states. and report certain data relating to broadband. significantly so) than interstate access rates. in the case of jointly-provided access services. although the specific rates are established by the states. We have been (and continue to be) involved in a number of disputes with LECs regarding the jurisdictional nature of access traffic. instead.

To address this inconsistent pattern of regulation. The FCC alleged that. The regime governing the framework for local competition has changed since the 1996 Act was enacted. In June 2009. Court of Appeals for the District of Columbia Circuit in March 2004. one of which was paid in July 2009 and the other of which was paid in January 2010) and adherence to a compliance plan for a period of three years. in large part to address the subject of local competition. the FCC issued a Notice of Proposed Rulemaking proposing long-term changes to the manner in which universal service funds are used. in December 2004 the FCC adopted its Triennial Review Remand Order which significantly restricts the types of facilities that ILECs must unbundle and provide to their local competitors and the circumstances under which those facilities must be unbundled and provided. It is not clear when the FCC will take final action on this issue. as amended. There are numerous regulatory and legislative efforts to reform universal service funding requirements and we cannot predict the outcome of these efforts. 2011. dispute and litigation costs for the industry. we have had a history of making our contributions to the funds late or.S. Should the FCC alter the rates associated with the various forms of intercarrier compensation. This has led to a significant amount of disputes and litigation throughout the industry. and the FCC’s rules. making only partial contributions or not making any contributions. such as Internet access to schools and libraries. The FCC received numerous comments on the subject. We have been (and continue to be) involved in a number of disputes with LECs regarding the jurisdictional nature of access traffic. The FCC’s February 2003 Triennial Review Order. Local Competition The 1996 Act substantially revised the Communications Act of 1934. In response. On February 8. the FCC has solicited additional comments from the industry on at least three occasions and is now considering the issue in the broader context of a “broadband plan. The prices of the local facilities that we obtain from ILECs will increase as resale or commercial arrangements 16 . it could materially impact our cost of providing service. which revised the unbundling rules. Should the FCC make changes to the status quo that result in a unification of intercarrier compensation rates. The FCC did not address how carriers are assessed to support the universal service fund. in 2001 the FCC issued a Notice of Proposed Rulemaking to consider how to unify the regulation of intercarrier compensation. 2008.charges are also being examined in the FCC’s Intercarrier Compensation proceeding. jurisdiction and nature of traffic. 2011. In 2010. including us. we agreed to a settlement of both this and another matter in a consent decree with the FCC that requires a total payment of approximately $3 million (in two equal installments. as amended. since emergence from bankruptcy.” On February 8. apparently violated the Communications Act of 1934. On April 9. by willfully and repeatedly failing to contribute fully and timely to the federal Universal Service Fund and the Telecommunications Relay Service Fund. the FCC released a Notice of Apparent Liability for Forfeiture finding that subsidiaries of Global Crossing North America. there is a high volume of billing disputes and litigation throughout the industry. in certain months. Universal Service Both the FCC and approximately 23 states administer “universal service” funds to provide for affordable local telephone service in rural and high-cost areas and to fund other social programs. Inc. including that they provide unbundled network elements. Because the rates for intrastate access charges can be significantly higher than rates for interstate switched access. Intercarrier Compensation Reform As described above. The 1996 Act delegated to the FCC and to the states significant discretion to implement the local competition provisions of the statute and imposed interconnection obligations on LECs. the current regime governing intercarrier compensation consists of a patchwork of different and inconsistent regulation depending upon such factors as the provider. was vacated and remanded in part by the U. Since then. it could reduce bill reconciliation. the FCC issued another Notice of Proposed Rulemaking seeking additional comment on a host of issues related to inter-carrier compensation. we expensed approximately $62 million related to payments to such funds.

the FCC adopted rules governing the provision of consumer broadband Internet access services. Most states require us to file tariffs or price lists setting forth the terms. In some states. The rules (1) require providers of consumer broadband Internet access to publicly disclose accurate information regarding the network management practices. The FCC allowed wireless carriers greater discretion in the management of their networks and is continuing to investigate the extent to which all carriers should be permitted to provide so-called “specialized services” outside of the net neutrality rules. the U. Local Government Regulation In certain locations. our tariff can list a range of prices for particular services. subject to reasonable network management. Several states where we do business. it is too early to conclude that they will have no effect on the provision of enterprise or carrier Internet access services and there is no way to predict the effect of the rules on the broader Internet ecosystem. Regulation in Canada Long distance telecommunications services in Canada are regulated by the Canadian Radio-Television and Telecommunications Commission (the “CRTC”). or non-harmful devices. expand and operate our fiber-optic systems in the public right-of-way.S. We cannot predict the outcome of the court appeals. U. In some of the areas where we provide network services. and commercial terms of its broadband Internet access services. Court of Appeals for the District of Columbia Circuit upheld the Triennial Review Remand Order. We are not subject to price cap or to rate of return regulation in any state in which we currently provide service. services. Many states require certification before a company can provide intrastate communications services. We cannot predict the outcome of any subsequent FCC proceedings. Resellers now have interconnection rights and may provide international services to the U. We are subject to direct state regulation in most.S. While the rules are directed at consumer broadband Internet access services. State Regulation State regulatory commissions retain jurisdiction over our facilities and services to the extent they are used to provide intrastate communications. conditions and prices for services that are classified as intrastate. We are certified in all states where we have operations and certification is required. Net Neutrality In December 2010. On June 16. and (3) prevent providers of consumer broadband Internet access services from unreasonably discriminating in the transmission of lawful network traffic over a consumer’s broadband Internet access service. the provision of Canadian domestic and international transmission facilities based services remains restricted to carriers majority owned by 17 . states in which we operate. by reselling the services provided by the regional telephone companies and by the former monopoly international carrier. if not all. the FCC’s net neutrality rules were challenged in U. 2006. performance. we must obtain local franchises.S. U. federal district court on the grounds that they exceeded the FCC’s authority to act. do not require us to file tariffs. Under current law. licenses or other operating rights and street opening and construction permits to install. Teleglobe Canada. our subsidiaries pay license or franchise fees based on a percentage of gross revenues or on a per linear foot basis.S. (2) prevent providers of consumer broadband Internet access from blocking lawful content. however. In January 2011.are substituted for the unbundled network element—platform services that ILECs no longer need to make available to competitors and as special access is substituted for the local loop and transport elements that are no longer subject to mandatory unbundling. prices can be set on an individual customer basis.S. In other states. applications.

permits and authorizations from the Mexican authorities to support its services. 2008. The Mexican market for fixed line domestic and international long distance services opened to competition beginning in 1996. impact this will have on our operations. The level of regulation and the regulatory obligations and rights that attach to us as an authorized operator in each country vary. we operate in Mexico pursuant to a joint venture arrangement. and consequently we are generally subjected to less intrusive regulation than providers that are deemed to possess such power. Our activities in Europe are subject to regulation by the European Union (“EU”) and national regulatory authorities. In all Member States of the EU. On January 23. an agency within the SCT. including the local telecommunications services market. and the provision of certain other services likewise requires the issuance of a permit or other approval by the SCT. Regulatory remedies are being introduced in due course 18 . In April 2002. In addition. we. the Federal Telecommunications Law (and its 2006 amendment). in certain cases. Market liberalization began in Mexico with the 1990 privatization of the incumbent telecommunications operator. CLECs may interconnect their networks with those of the ILECs and have access to certain ILEC services on an unbundled basis and. we obtained telecommunications licenses in all countries where authorization was required for us to construct and operate facilities or provide network services. although non-Canadian carriers such as ourselves may own international subsea cables landing in Canada. as a result. Under the Framework Directive (2002/21/EC). who are generally incumbents in the countries concerned. the EU has adopted a revised policy for dealing with the definition and regulation of significant market power. as a competitive entrant. and the Telecommunications Regulations. 2003. the Federal Competition Commission initiated an investigation to examine the existence of market power in four segments of the telecommunications market dominated by Telmex. including voice telephony. Under the Federal Telecommunications Law and the Telecommunications Regulations. now known as Telmex. although transmission facilities based CLECs are also subject to the abovedescribed majority Canadian ownership requirements. are currently considered to lack significant market power in the provision of bandwidth and call origination services. subject to mandatory pricing. European Regulation In connection with the construction and operation of our European network. It is unclear at this time what. The CRTC recently adopted a new policy to deregulate wholesale services over the next five years. although Telmex remains the leading provider of fixed local and long distance telephone services in Mexico. Our operating entity in Mexico has obtained concessions. Competition is permitted in other segments of the Canadian telecommunications market. transmission facilities based carriers (but not resellers) are entitled to collocate equipment in ILEC central offices pursuant to terms and conditions of tariffs and intercarrier agreements. if any. The Mexican telecommunications industry is primarily regulated by the Ministry of Communications and Transportation (“SCT”) and the Federal Telecommunications Commission. Any changes to the foreign ownership rules may impact our joint venture arrangement and potentially the manner in which we operate in Mexico. Several laws and regulations govern the provision of telecommunications services in Mexico. in accordance with a framework as set out in Directive 2002/21/EC and a package of related Directives. including the Law of General Means of Communication. a provider of public telecommunications services must operate under a concession granted by the SCT.Canadians. Regulation in Mexico Mexico maintains foreign ownership restrictions and. the then 15 EU Member States agreed to introduce a harmonized set of telecommunications regulations by July 25.

in general. Accession negotiations between the EU and several additional candidate countries are presently understood to be underway. The legislation which transposes the two Directives above into national law must be passed by May 26. build and operate networks and to provide services. 2007 with the accession of a further two countries. On November 4. BEREC has published its workplan for 2011 which includes notable initiatives such as tackling administrative and other barriers to the provision of cross border services to business customers and fostering a competitive environment regarding next generation access networks. save for use of scarce resources such as numbering addresses and radio spectrum. In November 2009. 2009.following a series of national reviews of telecommunications markets defined in accordance with Article 7 of the Framework Directive and Recommendations 2007/879/EC and C(2008)5925. the European Parliament and Council of Ministers agreed to implement a number of changes to the existing regime. Asian Regulation The status of liberalization of the telecommunications regulatory regimes of the Asian countries in which we operate or intend to operate varies. In June 2006. In principle. 19 . the EU also implemented one regulation establishing the Body of European Regulators for Electronic Communications (Regulation (EC) No 1211/2009). Some countries allow full competition in the telecommunications sector. 2011. 2004 with the accession of ten additional countries and on January 1. 2010 indicated adoption of a policy objective to ensure that every community in the country will have access to ‘superfast broadband’ by 2015 which. In the U. Where a national regulator identifies market dominance that is considered susceptible to ex ante remedies then it is required to impose conditions on the dominant party/ies in order to ensure fair competition. the Commission published new guidelines concerning the way in which Articles 81 and 82 of the EU Treaty (dealing with the anti-trust concept of abuse of dominance) should be interpreted by regulators. The Data Protection Directive (2002/58/EC) sets out the rights of consumers to privacy and establishes requirements for providers of communication services in relation to security and confidentiality of communications and the processing of traffic data. and ensure that the needs of users are more clearly defined and to remove potential ambiguity within the existing framework in a number of areas such as the processing of personal data. will require significant new investment in infrastructure projects. In those countries where the national telecommunications laws have been amended in accordance with the obligations under the Authorisation Directive. it is acknowledged. BEREC’s remit is to improve harmonization between national regulatory measures so as to ensure greater consistency of remedies and to anticipate emerging regulatory requirements. including telephony. innovation and investment certainty and in its Annual Plan for 2011 has set out the priority areas aimed at supporting the Government’s 2015 vision. The Office of Communications (“OFCOM”) has indicated that its regulatory policy focus is intended to support the growth of greater competition. a number of markets have been reviewed by regulators and ex ante conditions imposed which. At this time. comprising the “Better Regulation” Directive (Directive 2009/140/EC) and the “Citizens’ Rights” Directive (Directive 2009/136/EC). which are intended to improve the existing regulatory framework. the EU Regulatory Framework and the package of related Directives apply in such countries with effect from their accession date. We anticipate that this process will continue during 2011. The effect on us of such action cannot be accurately predicted. The size of the EU increased on May 1. a Government announcement on December 6. facilitate market entry and/or reduce the cost of access to incumbents’ networks.K. signaling a possible further enlargement of the EU at some time in the future. following two years of consideration from initial publication by the European Commission of a set of proposed reforms. Also included in the package of Directives are measures under the Authorisation Directive (2002/20/EC) (the “Authorisation Directive”) to remove the necessity for telecommunications network operators and service providers to obtain individual licenses and/or authorizations.. our licenses have been revoked in favor of a series of statutory rights to own.

some countries in Asia maintain foreign ownership restrictions which limit the amount of foreign direct investment and require foreign companies to seek local joint venture partners. has played an important role in facilitating the government’s liberalization program. Australia Australia signed on to the WTO Basic Telecommunications Agreement in 1997 and adopted the Telecommunications Act of 1997.S. Similarly. Industry self-regulation is encouraged in all areas. by country. the Internet. The Australian Communications and Media Authority (“ACMA”) is the regulatory of the Australian telecommunications industry. offering of voice services and pricing have not been addressed fully or at all. The Australian Competition and Consumer Commission (“ACCC”) regulates competition in the telecommunications industry. 20 . this agreement will have on other countries in the region or whether the U. Below is a summary of certain of the regulations currently applicable to our Asian operations. We cannot accurately predict whether or how these issues will be resolved and their impact on our operations in Asia. Much of Australia’s industry-specific rules are handled primarily by industry under the oversight of the ACCC and other government agencies. The TA has demonstrated a preference for market-driven. The effect on us of such an action cannot be accurately predicted. and Singapore in January 2003 established a new standard of liberalization based on bilateral negotiations with the U. Government regulators have powers to intervene if industry self-regulation is not working effectively in specific instances.S. but instead has established a process by which parties can negotiate mutually acceptable terms subject to the oversight of the ACCC. interconnection.S. technologically neutral solutions to industry issues.while others limit competition for most services. technical standards. Hong Kong Hong Kong is a signatory to the WTO Basic Telecommunications Agreement. Additionally. unbundling of local loops. the Office of the Telecommunications Authority (“OFTA”). which came into force in February 1998. responsible for the regulation of broadcasting. and its approach in the execution of its functions can generally be characterized as light-handed. Many issues. It is possible that one or more of the countries in which we operate or intend to operate will slow or halt the liberalization of its telecommunications markets. resale of telecommunications services. The main duties of OFTA cover economic and technical regulation of telecommunications services. Hong Kong’s telecoms regulator. There are no restrictions on foreign ownership. with the support of its executive arm. such as regulation of incumbent providers. We cannot predict what effect. the adoption of the Free Trade Agreement between the U. There are no restrictions on foreign investment in telecommunications outside of some limits on foreign ownership of the incumbent fixed line operator. the Telecommunications Authority (“TA”). and consumer and customer service standards. interconnection standards. including access. Australia does not impose specific interconnection rules. will pursue similar agreements with those countries. enforcement of fair competition in the telecommunications sector and management of radio frequency spectrum. Most of the countries in the region have committed to liberalizing their telecommunications regimes and opening their telecommunications markets to foreign investment as part of the World Trade Organization Agreement on Basic Telecommunications Services. if any. Australia permits unrestricted competition in all basic telecommunications services. We also cannot be certain whether this liberalizing trend will continue or accurately predict the pace and scope of liberalization. radio communications and telecommunications consumer and technical matters. The telecommunications regulatory regimes of many Asian countries are in the process of development.

such as regulation of incumbent providers. which establishes rules for the granting of licenses for telecommunications services.Japan Japan committed to the WTO Basic Telecommunications Agreement in 1997. but restrict competition for other services. In 2000. All of the countries in which we currently operate are members of the World Trade Organization and most have committed to liberalizing their telecommunications markets and lifting foreign ownership restrictions. resale of telecommunications services. Following deregulation in the 1990s. Following market liberalization. by country. while others allow competition for some facilities and services. As a general rule. unbundling of local loops. Singapore Singapore is a signatory to the WTO Basic Telecommunications Agreement. Some countries in which we operate currently impose limits on foreign ownership of telecommunications carriers. Some countries now permit competition for all telecommunications facilities and services. Argentina The Argentine telecommunications sector is subject to comprehensive regulation by the Comisión Nacional de Comunicaciones (“National Communications Commission”) and the Secretaría de Comunicaciones (“Secretary of Communications”). technology. The Info-Communications Development Authority (“IDA”) is the main telecommunications regulator in Singapore and views its role as supporting economic development in the area of information. The Argentine telecommunications market was opened to competition on November 9. the telecommunications industry was fully liberalized and Singapore does not maintain any foreign ownership restrictions. Latin American Regulation The status of liberalization of the telecommunications markets of Latin America varies. the government has issued a series of regulations to effectuate the transition to competition in telecommunications. 764/00. interconnection. These rules and regulations. The Decree also established new rules and regulations to promote access to telecommunications services for customers located in high-cost access or maintenance areas or with physical limitations or special social needs. 2001. and the management and control of the radioelectric spectrum. establish that the provision of these services 21 . 2000. the Ministry of Internal Affairs and Communications (“MIC”) is the competent authority on policymaking and policy development procedures for the telecoms and information sectors. The telecommunications regulatory regimes of many Latin American countries are in the process of development. including Decree No. The regulations apply equally to all of our operating entities within the region. interconnection. and communications.3 per cent) imposed by law is NTT. Below is a summary of certain of the regulations currently applicable to our Latin American operations. Many issues. the only Japanese telecom operator subject to foreign ownership restrictions (no more than 33. The IDA has established a mature interconnection and unbundling regime. We cannot accurately predict whether or how these issues will be resolved and their impact on our operations in Latin America. effective January 1. subject to the foreign ownership restrictions applicable to Nippon Telegraph and Telephone Corporation (“NTT”). Disputes between carriers are resolved by a dispute resolution panel established by the MIC. and pricing have not been addressed fully or at all. Interconnection is strictly regulated in Japan and operators of essential facilities are required to have a standard form agreement for interconnection.

Furthermore. Ecuador The telecommunications industry in Ecuador is regulated by the Consejo Nacional de Telecomunicaciones (the “National Telecommunications Council”) and the Secretaria Nacional de Telecomunicaciones (the “National 22 . pursuant to Law No. nonetheless.be financed by all telecommunications providers (including us) through a Universal Service Fund. including the granting of licenses under the General Telecommunications Law.472 of July 16. an independent agency subordinated to the Ministry of Communications that regulates and supervises all aspects of telecommunications services. authorizations. the cost of defending against these claims could be high. the Colombian government adopted a new regulatory regime that should further the liberalization of the telecommunications market. in which free. telecommunications companies in Argentina have been subject to increased taxes and fees from both provincial and municipal authorities. although those who provide additional services must comply with the technical standards established by the Department of Telecommunications and obtain an authorization. It is not necessary to have a telecommunications service license to offer supplementary services. Colombia The telecommunications industry in Colombia is subject to regulation by the Colombian Ministry of Communications. non-discriminatory access was granted to private firms in the development of the nation’s telecommunications services.” known as “ANATEL”). compulsory interconnection between public service licensees and tools for setting telecommunication service tariffs where existing market conditions were deemed insufficient to guarantee a free tariff system. While we have challenged the constitutionality of some of these claims. This law authorized the creation of the Agencia Nacional de Telecomunicações (the “National Telecommunications Agency. Since 1991. Chile The telecommunications industry in Chile is regulated by the Undersecretariate of Telecommunications. a new National Policy on Telecommunications was issued which. in its most relevant aspects. Brazil Telecommunications services in Brazil are regulated by the Ministry of Communications. 9. Chile amended its General Law on Telecommunications in 1985 to provide that concessions and permits may be granted without limit with respect to the quantity and type of service and geographic location. The law guarantees interconnections among telecommunications service concessionaires. called for the development of telecommunications services to be conducted by private institutions through concessions. ANATEL has generally pursued a policy of market liberalization and supported a competitive telecommunications environment. endorsed a series of regulations aimed at establishing increased technical control over such investments and conferring certain discretionary powers on the government. the Ministry of Communications has pursued a policy of liberalization and has encouraged joint ventures between public and private telecommunications companies to provide new and improved telecommunications services. In 2009. In 1978. During the last 5 years. Chile defines value added services as supplementary services. The policy. The policy was formalized through the General Law on Telecommunications approved in 1982. This law established responsibilities with respect to telecommunication services. an institution subordinated to the Ministry of Transportation and Telecommunications. backed by the payment of 1% of each provider’s total revenues for telecommunications services. there is no certainty that we will prevail on such challenges. 1997 (the “General Telecommunications Law”). ANATEL enforces the legislative determinations of the Ministry of Communications. permits and licenses granted by the government.

General Law 26 and General Law 31 established the regulatory framework for telecommunications regulation. the Venezuelan government nationalized the incumbent telecommunications operator. and the incumbent’s official monopoly ended in 2004. Venezuela opened its telecommunications market to competition on November 28. 23 . the government issued a new law that establishes that the provision of telecommunications services is an activity of the “public domain. In 2007. Peru The telecommunications industry in Peru is regulated by the Supervisory Authority for Private Investment in Telecommunications (“OSIPTEL”) and the Ministry of Transportation and Communications (“MTC”). Since market liberalization became effective in August 1998. an independent regulatory body. except for services subject to natural limitations on grounds of scarce resources. Liberalization of the market has been ongoing. Under Peruvian law. CANTV. 2000. Panama The telecommunications industry in Panama is regulated by Ente Regulador de los Servicios Públicos. In December 2010. The functions related to the issuance of concessions and market access registration and the assignment of the radio spectrum for public telecommunications services are managed by the MTC’s General Directorate of Telecommunications.” known as “SENATEL”) and is under the control and supervision of the Superintendencia de Telecomunicaciones (“Superintendent of Telecommunications”). OSIPTEL is an independent regulatory body attached to the Office of the President of the Council of Ministers.Telecommunications Secretary. Venezuela The Venezuelan telecommunications industry is regulated by the Comisión Nacional de Telecomunicaciones (“CONATEL of Venezuela”). as in the case of the radio spectrum. which is ascribed to and under the purview of the Vice President of Venezuela. there has been no limitation on the issuance of concessions. the provision of public telecommunications services requires a concession. the government has not indicated its intent to expand nationalization within the telecommunications sector.” To date.

These statements set forth anticipated results based on management’s plans and assumptions. future events or otherwise. funding of capital expenditures. legal and tax proceedings and audits. we also provide forward-looking statements in other materials we release to the public as well as oral forward-looking statements. statements regarding: • our services. We note these factors for investors as permitted by Section 21E of the Exchange Act. RISK FACTORS Cautionary Factors That May Affect Future Results (Cautionary Statements Under Section 21E of the Securities Exchange Act of 1934) Forward-Looking Statements This annual report on Form 10-K contains certain “forward-looking statements. you should not consider the following to be a complete discussion of all potential risks or uncertainties. Free Cash Flow (as defined in Item 7). data center and collocation services and video transmission and Internet “cloud-based” services. to consult any further disclosures we make on related subjects in our quarterly reports on Form 10-Q and current reports on Form 8-K. could cause our actual results to differ materially from expected and historical results. however.ITEM 1A. and the ability to refinance indebtedness and to raise capital through financing activities.” “believe. and the outcome of contingencies. estimated or projected. We have attempted to identify such statements by using words such as “anticipate. foreign exchange rates. our liquidity and financial resources.” “intend. • • • • We cannot guarantee that any forward-looking statement will be realized. order volumes. expenses. including but not limited to those statements set forth in Item 7.” “could” and similar expressions in connection with any discussion of future events or future operating or financial performance or strategies. including with respect to the development of IP-based services. Investors should bear this in mind as they consider forward-looking statements. results of operations. required capital expenditures. individually or in the aggregate. You should understand that it is not possible to predict or identify all such factors. trends related to. including anticipated capital expenditures. Consequently. uncertainties and potentially inaccurate assumptions. Achievement of future results is subject to risks. including capital leases and similar financings. Also note that we provide the following cautionary discussion of risks and uncertainties related to our businesses. actual results could vary materially from past results and those anticipated. whether as a result of new information. interest rates. Should known or unknown risks or uncertainties materialize.” as such term is defined in Section 21E of the Exchange Act. gross margin.” “estimate. they do not relate strictly to historical or current facts. From time to time. OIBDA (as defined in Item 7. You are advised. including the development and deployment of data products and services as well as video transmission and Internet “cloud-based” services based on IP and other technologies and strategies to expand our targeted customer base and broaden our sales channels and the opening and expansion of our data center and collocation services. expenses and cash flows.” “plan. or should underlying assumptions prove inaccurate. integration of acquired businesses.” “expect. In addition to the risk factors identified under the captions below. and sales efforts. Such statements give our current expectations or forecasts of future events. We undertake no obligation to update forward-looking statements.” “project. Such forward-looking statements include.” “will. revenues from existing and new lines of business and sales channels. anticipated levels of indebtedness. and management’s expectations regarding. such as regulatory. Our forward-looking statements are subject to a variety of factors that could cause actual results to differ significantly from current beliefs and expectations. These are factors that we believe. “Management’s Discussion and Analysis of Financial Condition and Results of Operations”). but are not limited to. the operation of our network. the operation and results of our business are subject to risks and uncertainties identified elsewhere in 24 .

and there can be no assurance that we will be able to obtain such financing on favorable terms or at all. the availability. additional consolidation of the financial services industry. Ongoing concerns about volatile energy costs. geopolitical issues. This expectation is based in part on raising financing for such property and equipment from vendors and others in amounts similar to those arranged in 2010. If we undertake such initiatives. in the event of renewed financial turmoil affecting the banking system and financial markets. and international markets and economies and declines in business and consumer spending may adversely affect our liquidity and financial condition. plans to reduce our operating expenses and/or optimize existing operating resources. additional capital investment in our network and service infrastructure and opportunistic acquisitions. we have incurred substantial operating losses. there is no assurance that our business will generate sufficient cash flow from operations. For most periods since inception. See Item 7.S.this annual report on Form 10-K as well as general risks and uncertainties such as those relating to general economic conditions and demand for telecommunications services. Our operating cash flows will be adversely impacted by incremental annualized interest expense resulting from the issuance of our 9% senior notes due 2019 and the associated refinancing in November 2010. and equity markets. low liquidity. Turbulence in the U. there could be a new or incremental tightening in the credit markets. The global economy and capital and credit markets have experienced exceptional turmoil and upheaval in recent years. The availability. including those in which we operate. currency. we may not be able to make all necessary capital and other expenditures to run and grow our business. At any given time in connection with the foregoing we may be engaged in varying levels of analyses or negotiations with potential counterparties. including our ability to refinance maturing debt instruments and to access the capital markets and obtain capital lease and similar financing to meet liquidity needs. austerity measures in certain European and other countries. volatile foreign currency markets. credit. From time to time we review our operations and may consider opportunities to strategically enhance. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources. Although we expect our operating results to improve over time. expansion of existing or entry into complementary lines of business. we may require additional equity or debt financing to consummate those transactions. and the liquidity and financial condition of our customers. However. Initiatives that may result from such reviews may include. among others. expand or change our operations and leverage our capabilities. Risks Related to Liquidity and Financial Resources We face a number of risks related to current global economic conditions and the tightening in the global credit markets. that currently anticipated operating improvements will be realized on schedule or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. cost and terms of credit. or significant financial service institution failures. If we are unable to arrange such financings. including the expenditures that will be necessary to implement our operational imperatives. cost and terms of credit have also been and may continue to be adversely affected by illiquid markets and wider credit spreads. We also anticipate lower sales of IRUs and prepaid services in 2011 than those realized in 2010. improvements in underlying operating results are expected to largely offset these factors such that we currently expect cash provided by operating activities (including IRUs and other prepaid sales) to exceed purchases of property and equipment for the full year 2011. sovereign debt levels and associated default risk. it may place greater demands on our cash flows and liquidity due to increased capital and operating expenses and debt service. While there have been signs of stability during the second half of 2010. Our ability to arrange such financings is subject to negotiating acceptable terms from equipment vendors and financing parties.” 25 . and extreme volatility in fixed income. We have incurred substantial operating losses since inception and will continue to experience negative cash flows. substantially increased unemployment and adverse conditions in the global housing and mortgage markets have contributed to increased market volatility and diminished expectations for both established and emerging economies. consumer and business confidence. If we pursue any such initiatives or transactions.

In addition. and from ongoing cost management initiatives. We may not be able to achieve anticipated economies of scale. As of December 31. 2010. We do not expect to generate sufficient cash flows from operations to repay all of these debt instruments at maturity. which would adversely impact our working capital and liquidity. We can provide no assurances that we will be successful in these regards. We are required to use a significant portion of our cash flows to make principal and interest payments on this debt. In addition. we may be unable to improve our profitability and/or cash flows even if revenue growth goals are achieved. including the economies of scale expected from such growth. we are dependent on access to the capital markets to meet our liquidity requirements. Moreover. our liquidity would be adversely affected. representing tens of millions of dollars of cash in most quarters. (ii) the $750 million original principal amount of GCL’s 12% senior secured notes (the “12% Senior Secured Notes”) matures in 2015. our substantial debt may make it more difficult for us to obtain additional financing for investments and working capital. Our substantial indebtedness may have adverse consequences for our business. Such access will depend on market conditions and our credit profile at the relevant time(s).Our ability to generate positive cash flow over the long term is predicated on significant revenue growth in our higher margin enterprise. In addition. Adverse conditions in global capital and credit markets could make it more difficult for us to obtain financing on commercially acceptable terms or at all. We cannot be certain of our ability to refinance our debt or raise additional capital on acceptable terms or at all. The larger dollar amounts and long sales cycles typically associated with IRU sales increase the volatility of our quarter-to-quarter cash flow results. If our cash flows do not improve. and (iii) the $150 million original principal amount of GCL’s 9% senior notes (the “9% Senior Notes”) matures in 2019. if customer buying patterns were to change such that those traditionally buying long-term IRUs with significant upfront payments were to switch to payment over time lease structures or were to forego or significantly curtail such purchases. we would need to arrange financing facilities in order to continue as a going concern. Access vendors could force us to accelerate or increase payments to them. we had consolidated indebtedness of $1. which places us at a competitive disadvantage.46 billion. We expect that economies of scale will allow us to increase revenues while incurring incremental costs that are proportionately lower than those applicable to our existing business. These cash flows are therefore not available for operations or to fund potential investments. improvements in our cost structure in the short term become more difficult as the amount of potential savings decreases due to the success of past savings initiatives. many of our competitors have lower relative levels of indebtedness. If such demands were to continue 26 . With regard to our major debt instruments. If the increased costs required to support our revenue growth turn out to be greater than anticipated. We may not be able to repay our existing indebtedness with cash flows from operations. including initiatives to optimize the access network and effectively lower unit costs. certain telecommunications carriers from which we purchase access services demanded that we pay for access services on a more timely basis. which resulted in increased demands on our liquidity. We actively manage our working capital through careful attention to our receivables and payables. carrier data and indirect sales channel businesses. Therefore. The sale of IRUs and similar prepayments for services continue to be an important source of cash flows for us. (i) the remaining $429 million outstanding principal amount of GCUK’s senior secured notes (the “GCUK Notes” or “GCUK Senior Secured Notes”) matures in 2014. Cost of access represents our single largest expense and gives rise to material current liabilities. We may be unable to arrange financing facilities on acceptable terms or at all. In the past.

Similarly. “Market for Registrant’s Common Stock and Related Stockholder Matters—Description of Global Crossing Equity Securities. which would have a material adverse effect on our business. the covenants in the 12% Senior Secured Notes and 9% Senior Notes indentures impose certain limitations on the ability of entities in our ROW and GC Impsat segments to make intercompany funds transfers to other entities in those segments that have not granted liens on their assets to secure the 12% Senior Secured Notes and/or that have not provided guarantees of the 12% Senior Secured Notes and the 9% Senior Notes. We and numerous of our subsidiaries have material indebtedness outstanding under the 12% Senior Secured Notes. asset sales. For a further discussion of these issues and our indebtedness. results of operations and financial condition. These covenants impose significant restrictions on the ability of entities in our ROW and GC Impsat segments to make intercompany funds transfers to entities in our GCUK segment and vice versa. the “Principal Debt Instruments”). and mergers. creating or assuming liens. dividend and other payments to holders of equity and subordinated debt. If the indebtedness under any of our Principal Debt Instruments or material Capital Lease Facilities were to be accelerated. See Item 5. our liquidity requirements would be adversely affected. such increases would adversely affect our cash flows. consolidations. many of our assets are leased by us under capital lease facilities (the “Capital Lease Facilities”) that contain non-financial covenants which require specific tracking and reporting procedures for the physical location of the leased assets. please see Item 7.to a greater degree than anticipated. The failure to meet these covenants allows the lessor to accelerate payments under the lease. could result in an acceleration of all such debts. Moreover. on a timely basis or at all. the certificate of designations governing our 2% Cumulative Preferred Shares (the “GCL Preferred Stock”) requires the holder’s approval for certain major corporate actions of us and/or our subsidiaries. if our access vendors were to increase significantly the amount they charge to us due (for example) to a more permissive regulatory environment. and transactions with affiliates. The Principal Debt Instruments generally contain covenants and events of default that are customary for high-yield debt facilities. The covenants in our major debt instruments limit our financial and operational flexibility. In addition. Additionally. the 9% Senior Notes and the GCUK Senior Secured Notes (collectively. including limitations. A failure to comply with the restrictions or covenants contained in our Principal Debt Instruments or certain Capital Lease Facilities could result in an event of default. investments or other restricted payments. if not cured or waived. which may not be available on favorable terms. on: • • • • • • incurring or guaranteeing additional indebtedness and issuing preferred stock. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources— Indebtedness. we would have to raise funds from alternative sources.” 27 .” Finally. an uncured default by the obligors under our Principal Debt Instruments or certain of our Capital Lease Facilities could trigger cross-default provisions under other such instruments or facilities. which.

We may become subject to unanticipated tax liabilities that may have a material adverse effect on our results of operations. or any tax in the nature of estate. 1966. We have material tax-related contingent liabilities that are difficult to predict or quantify. provided that such an exemption shall not prevent the application of any such tax or duty to such persons as are ordinarily resident in Bermuda and shall not prevent the application of any tax payable in accordance with the provisions of the Land Tax Act. the solvency of such entities or other local law restrictions (e. 2016. However. until March 28. our results of operations could be adversely affected. See Note 13.Our international corporate structure limits the availability of our consolidated cash resources for intercompany funding purposes and reduces our financial flexibility. duty or inheritance tax. “Income Tax. for a discussion of important exchange rate and expatriation risks involving our Venezuelan and other subsidiaries. This belief is based on our current position under the tax laws of the countries in which we have assets or conduct activities. could cause us or certain of our subsidiaries to become and remain illiquid while other subsidiaries have sufficient liquidity to meet their liquidity needs. restrictions related to foreign exchange controls or transfer approvals). The Ministry of Finance in Bermuda has granted a tax assurance to GCL and its Bermuda incorporated subsidiaries under the Exempted Undertakings Tax Protection Act. tax legislation and regulations are proposed from time to time in various jurisdictions. and we believe that a significant portion of our income will not be subject to tax in Bermuda. “Commitments. The Ministry of Finance has indicated that the Ministry will extend the term of the assurance beyond 2016. This position is subject to review and possible challenge by taxing authorities and to possible changes in law that may have a retroactive effect. gain or appreciation. which currently has no corporate income tax. we are subject to multiple sets of complex and varying tax laws and rules.” below. Due to the international nature of our operations. We and certain of our subsidiaries are Bermuda-based companies. In addition. which. While we believe that our current tax provisions are reasonable and appropriate. which apply to most of our subsidiaries given their history of operating losses. if adopted. As a result. all of our revenues are generated by our subsidiaries and substantially all of our assets are owned by our subsidiaries. we are dependent upon dividends and intercompany transfers of funds from our subsidiaries to meet our debt service and other payment obligations. from the imposition of tax under any applicable Bermuda law computed on profits or income or computed on any capital asset. which expires in 2016. Some of our subsidiaries have cash on hand that exceeds their immediate requirements but that cannot be distributed or loaned to us or our other subsidiaries to fund our or their operations due to contractual restrictions (such as those described in the immediately preceding risk factor) or legal constraints related to the lack of retained earnings. We cannot predict our future tax liabilities. Also see “—We are exposed to significant currency transfer restrictions and currency exchange rate risks and our net loss may suffer due to currency translations. we cannot be assured that these items will be settled for the amounts accrued or that additional exposures will not be identified in the future. If we become subject to increased levels of taxation or if tax contingencies are resolved adversely. we can give no assurance as to the length of any extension. could have a material adverse effect on 28 . or in other countries in which we conduct activities or in which our customers are located. GCL and its Bermuda incorporated subsidiaries have received an assurance from the Ministry of Finance granting an exemption. results of operations and financial condition. These restrictions. As a holding company. Contingencies and Other.” and Note 19. 1967 or otherwise payable in relation to land in Bermuda leased to GCL or its Bermuda incorporated subsidiaries..” to our consolidated financial statements included in this annual report on Form 10-K.g. Any increase in the amount of taxation incurred as a result of our operations or due to legislative or regulatory changes could result in a material adverse effect on our business. including the United States and the United Kingdom. We cannot predict the amount of future tax liabilities to which we may become subject. Our subsidiaries are incorporated and operate in various jurisdictions throughout the world.

including telecommunications.S. On December 31. subject us to U. Our pension expense and required contributions to our pension plan are directly affected by the value of plan assets.K. and various other members of the European Union have announced austerity measures aimed at reducing costs in a wide range of areas. under certain circumstances. including the integration of such acquisitions. Some of the primary factors that may affect our results of operations include the following: • • • • • • • changes in pricing policies or the pricing policies of our competitors. the projected rate of return on plan assets. Results in future quarters may be below analysts’ and investors’ expectations. For example. The implementation of pricing actions and the reduction of spending by governmental entities could have a negative effect on our future revenue performance. 2010. A delay in generating revenue or the timing of recognizing revenue and expenses could cause significant variations in our operating results from quarter to quarter. the U. Many countries. Austerity measures announced by governments may negatively impact our revenue. changes in regulations and regulatory rulings or interpretations. and resolution of contingent liabilities.S. costs of acquisitions. many of which are outside of our control. changes in tax law or policy. possibly even if we are not found to have engaged in a trade or business within the United States or to have had an office or other fixed place of business in the United States. future pension expense and funding obligations will increase. If plan assets perform below expectations.K. our North American plan was frozen and all employees hired thereafter are not eligible to participate in the plan. which would have a negative impact on our cash flows from operations. 1999. Certain North American and European hourly and salaried employees are covered by our defined benefit pension plans.K. Department of the Treasury finalized regulations with respect to the source of international and other types of communications income. As of December 31. including the U. withholding tax on a significant portion of our income. plans) and the value of plan assets was approximately $83 million ($18 million for US plans and $65 million for U. The regulations as adopted could. plans). as well as our own forecasts. Our revenue and operating results may vary significantly from quarter to quarter due to a number of factors. that of the GCUK Segment. plans were closed to new employees on December 31.our results of operations. plans and $68 million for U. decrease borrowing capacity and increase interest expense. in particular. The majority of our North American network and some of the other transmission facilities comprising our global network are held by us through long-term leases or IRU agreements with various companies that provide 29 . Our U. general economic conditions as well as those specific to our industry. in December 2006. Risks Related to Our Operations We are subject to several unpredictable factors that may adversely impact our results of operations. Our pension plans may require additional funding and negatively impact our cash flows. the projected benefit obligation under our pension plans was approximately $83 million ($15 million for U. 1996.S. demand for our higher margin services. the actual rate of return on plan assets and the actuarial assumptions we use to measure the defined benefit pension plan obligations.K. Our rights to the use of the fiber that make up our network may be affected by the financial stability of our fiber providers.

corporate governance practices. It is expensive and difficult for us to switch a new customer to our network because we require cooperation from the incumbent carrier in instances where there is no direct connection between the customer and our network.. therefore. The Network Security Agreement imposes significant requirements on us.S. We offer transit arrangements to non-Tier 1 Internet network operators that allow them to access the Internet through us for a charge. operations and would have a material adverse effect on our business. Peering agreements with other Tier 1 Internet network operators allow us to access the Internet and exchange traffic on a settlement-free basis with these providers. along with certain of our subsidiaries. If we are unable to renegotiate or maintain interconnection agreements in all of our markets on favorable terms. or in most of the foreign jurisdictions in which we operate and.S. Our providers. While we expect to continue to comply fully with our obligations under the Network Security Agreement. We may not be able to renegotiate or maintain peering arrangements on favorable terms. results of operations and financial condition. Recently. It is expensive and difficult to switch new customers to our network. traffic routing and management. Increases in costs associated with limitations on settlement-free peering could have a material adverse effect on our margins for our products that require Internet access.” to our consolidated financial statements included in this annual report on Form 10-K. and network security arrangements. Contingencies and Other—Contingencies—Qwest Rights of Way Litigation. more restrictive criteria for peering and an increasing number of these network operators are seeking to impose charges for transit instead of settlement-free peering. many network operators that previously offered peering have reduced or eliminated peering relationships or are establishing new. The consequences of a violation of the Network Security Agreement could be severe. also are parties to legal proceedings the outcome of which may affect our rights to use certain portions of our network. Although certain rights to interconnect with other networks are subject to legal and regulatory protection. and other matters. which can complicate and add to the time and expense that it takes to provision a new customer’s service. and lack of cooperation of incumbent carriers can slow the new customer connection process. the laws governing the ability of fiber providers to provide us access to their fibers pursuant to longterm leases and IRU agreements vary by jurisdiction and. 30 . new IP-based networking technologies are becoming more generally adopted within the industry and new commercial and charging models are being developed for interworking between these networks. The extent to which such new models may affect our business is currently uncertain. which would result in the cessation of our U. in some cases. which would impair our growth and performance. A violation of the agreement could have severe consequences. which in turn could have a negative impact on the integrity of our network and ultimately on our results of operations. our rights with respect to fiber agreements under such circumstances are unclear. it is impossible to eliminate completely the risk of a violation of the agreement. logical. the term of such leases and agreements may be limited by law. “Commitments.S. physical.” We may not be able to continue to connect our network to incumbent carriers’ networks or maintain Internet peering arrangements on favorable terms. In addition. To our knowledge. the rights of the holder of such rights in strands of fiber in the event of bankruptcy have not been specifically addressed by the judiciary at the state or federal level in the U. personnel screening and training. The Network Security Agreement imposes significant requirements on us related to information storage and management. potentially including the revocation of our FCC licenses in the U. The bankruptcy or financial collapse of one of these fiber providers could result in a loss of our rights under such leases and agreements with the provider. See Note 19. We must be party to interconnection agreements with incumbent and competitive carriers in order to connect our customers to the PSTN. it could adversely affect our ability to provide services in the affected markets.us access to fiber owned by them.

which could negatively affect our operating results and we may be exposed to other liabilities. we rely on the incumbent carrier to process certain information. Our inability to retain our key management personnel or to continue to attract skilled management personnel could have a material adverse effect on our business. Although we attempt to disclaim liability for these losses in our service agreements. In addition. complex fiber-optic telecommunications systems including (i) equipment breakdowns. Recent capital expenditure levels may not be sustainable. The incumbent carriers have a financial interest in retaining their customers. which could expose us to financial loss. While capital expenditures have remained relatively stable at levels significantly below those prevailing prior to our bankruptcy reorganization. and (vii) natural disasters. results of operations and financial condition. The failure of the hardware or software to function as required could render a cable system unable to perform at design specifications or at all. In addition. which could have a material adverse impact on our business. results of operations and financial condition. The operation. generally in the form of free service for a short period of time. thereby adversely impacting our ability to compete and grow revenues. we may be obligated to provide our customers with credits. maintenance and repair of our systems require the coordination and integration of sophisticated and highly specialized hardware and software technologies and equipment located throughout the world and require significant operating and capital expenses. which could reduce their willingness to cooperate with our new customer provisioning requests. we often provide customers with guaranteed service level commitments. administration. (vi) physical damage to access lines and equipment. To complete the new customer provisioning process. a court might not enforce a limitation on liability under certain conditions. (iii) power outages. as our network elements become obsolete or reach their design life capacity. We may not be able to retain our key management personnel or attract additional skilled management personnel. (v) security breaches. Furthermore. (iv) software defects. In particular. administration. If we are unable to meet these guaranteed service level commitments for whatever reason. any of which would adversely affect our revenues. interruptions in service or performance problems. a significant interruption in service could result in lost profits or other loss to customers. For example. all of which could cause us to suffer customer dissatisfaction. for whatever reason. particularly as our 31 . maintenance and repair of our systems require significant expenses and are subject to risks that could lead to disruptions in our services and the failure of our systems to operate as intended for their full design life. the domestic and international incumbent carriers. because many of our services are critical to our customers’ businesses. loss of business. loss of revenue or the inability to add customers on a timely basis. and to bill for services efficiently and accurately. The operation. are already established providers of local telephone services to all or virtually all telephone subscribers within their respective service areas. (ii) service interruptions. Their physical connections from their premises to those of their customers are expensive and difficult to duplicate. Further consolidation of incumbent carriers with other telecommunications service providers may make these problems more acute. Each of our systems is subject to the risks inherent in large-scale. We depend on key members of our senior management team to remain competitive and achieve our strategic goals. such levels may not be sustainable in the future. our operating and capital expenses could significantly increase depending on the nature and extent of repairs or replacements. Our systems may not continue to function as expected in a cost-effective manner.Many of our principal competitors. could undermine confidence in our services and cause us to lose customers or make it more difficult to attract new ones. a failure of our operations support systems could adversely affect our ability to process orders and provision sales.

including customer service. the activities of our or our acquisitions’ businesses. While we do not believe that there exists any technology patented by others. pursue acquisitions to grow our business. customs. Any significant diversion of management’s attention or any major difficulties encountered in the integration of the business such as insufficient revenue to offset expenses. Ecuador. In addition. we lease capacity and obtain rights of way and other services from carriers and government and quasi-government agencies in those and other regions. including: uncertain and rapidly changing political. results of operations and financial condition. If such intellectual property is owned by others and not licensed by us. or a loss of momentum in. including raising any necessary financings. Our ability to fund future capital expenditures may be limited by our ability to generate sufficient cash flow. burdensome tax. In addition. and such efficiencies will be limited to some degree by our Principal Debt Instruments and Capital Lease Facilities. the integration of networks. inadequate return of capital. vandalism affecting cable assets. and difficulties in staffing and managing operations consistently through our several operating areas. all of which could disrupt the timeliness of financial information. Asia and Europe. 32 . managing operations in multiple jurisdictions may place further strain on our ability to manage growth. interruptions to essential energy inputs. cancellation or non-renewal of contract rights. results of operations and financial condition. legal. This could force us to cease offering products and services incorporating such intellectual property. exposure to new or different accounting. direct and indirect price controls. regulatory and other risks from our operations in foreign jurisdictions. and issues not identified in the Company’s pre-acquisition due diligence process. which could prove to be difficult if conditions in the credit markets deteriorate. Intellectual property and proprietary rights of others could prevent us from using necessary technology. our business is subject to particular risks from operating in some of these areas. that is necessary for us to provide our services and that is not now subject to a license allowing us to use it. regulatory assessments or right-of-way charges based on new or differing interpretations of law or regulations. exchange and/or transfer restrictions related to foreign currency. the retention of current personnel and the training of new personnel. armed conflict or the seizure or nationalizing of private property. terrorism. legal. We may not be successful in making or integrating acquisitions with our business or may not be able to realize the benefits we anticipate from such acquisitions. the integration of product offerings and customer base. systems and culture of our acquisitions requires the continued development of our financial and management controls. from time to time we receive claims from third parties in this regard and there can be no assurances as to our ability to defend against those claims successfully. including the possibility of civil unrest. regulatory and economic conditions. which could have a material adverse effect on our business. or other intellectual property owned by others. The management of the integration of the businesses. The process of integrating acquisitions with our business so that the consolidated business operates as efficiently as possible requires significant corporate resources. results of operations and financial condition. tax and regulatory standards. We derive a substantial portion of our revenue from international operations and have substantial physical assets in several jurisdictions along our routes. including the integration of information systems and structure. In addition. delays or denial of government approval. place a strain on our management resources and require significant expenditure. including Venezuela. Brazil and other countries in Latin America. and may in the future. Argentina. we would have to negotiate a license for the use of that intellectual property.business continues to grow. We may not be able to negotiate such a license at a price that is acceptable or at all. unexpected changes in regulatory environments and trade barriers. thereby adversely affecting our business. could have a material adverse effect on our business. duties. this process could cause the interruption to. We have substantial international operations and face political. tax. As a result. We have in the past.

S. our employees and agents comply with the FCPA and other anticorruption laws. where we issue invoices for our services in currencies other than U. Dollars. law in relation to bribery. or foreign authorities could have an adverse impact on our business. Any investigation of any potential violations of the FCPA or other anticorruption laws by U. notably facilitation payments that are permitted by the FCPA. Dollar could adversely affect our ability to market our services to customers whose revenue is denominated in those currencies. 33 . Dollar and we cannot or do not elect to enter into currency hedging arrangements in respect of those payment obligations.S.S.S. Declines in the value of foreign currencies (such as the devaluation of the Venezuelan bolivar discussed below) relative to the U. In addition. which is expected to come into force in 2011. Certain of our current and prospective customers derive their revenue in currencies other than U.S. Ministry of Justice plans to publish guidance on the meaning of “adequate procedures” in advance of the date the Bribery Act comes into effect. it should be noted that it also has a wide-ranging extra-territorial effect. In addition. the affected customers may not be able to pay us in U. which generally prohibits companies and their intermediaries from making improper payments to foreign officials for the purpose of obtaining or keeping business and/or other benefits. will reform the U. financial condition. The Bribery Act is broader in scope than the FCPA in that it directly addresses commercial bribery in addition to bribery of government officials and it does not recognize certain exceptions.K. which could have an adverse impact on our business.We are subject to the U. Foreign Corrupt Practices Act (the “FCPA”) and other anticorruption laws. Dollars and to expatriate such funds for the purpose of making timely payments of interest and principal on our indebtedness.K. results of operations and financial condition. The U.S. We operate in a number of jurisdictions that pose a high risk of potential anticorruption violations. financial condition and results of operations. Certain Latin American economies have experienced shortages in foreign currency reserves and have adopted restrictions on the use of certain mechanisms to expatriate local earnings and convert local currencies into U. currency devaluations in one country may have adverse effects in another country. Although we have policies and procedures designed to ensure that we. Dollars but are invoiced by us in U. Dollar. and our failure to comply therewith could result in penalties which could harm our reputation and have a material adverse effect on our business. The U.S. including GCUK and our other U. we may be subject to criminal and civil penalties and other remedial measures.S.S. Furthermore. there can be no assurance that such policies or procedures will work effectively all of the time or protect us against liability for actions taken by our agents.S. We are exposed to significant currency transfer restrictions and currency exchange rate risks and our net loss may suffer due to currency translations. Under the Bribery Act. This offense applies when any person associated with the organization offers or accepts bribery anywhere in the world intending to obtain or retain a business advantage for the organization or in the conduct of business.K. If we are not in compliance with the FCPA and other laws governing the conduct of business with government entities (including local laws). Any such shortages or restrictions may limit or impede our ability to transfer or to convert such currencies into U. our net loss may suffer due to currency translations in the event that such currencies depreciate relative to the U. results of operations and liquidity. However. Dollars. We are subject to the FCPA. The Bribery Act has wide ranging implications in particular for business in the U. subsidiaries. it will be a defense to the accusation of failure to prevent bribery for a commercial organization to show that it had in place “adequate procedures” designed to prevent such acts..K. The obligations of customers with substantial revenue in foreign currencies may be subject to unpredictable and indeterminate increases in the event that such currencies depreciate in value relative to the U. employees and intermediaries with respect to our business or any businesses that we acquire.S. As well as containing provisions concerning bribery of public officials. the Bribery Act introduces a new criminal offence of failing to prevent bribery by relevant commercial organizations. Dollars. such customers may become subject to exchange control regulations restricting the conversion of their revenue currencies into U. Dollars.S.K. Dollars. Bribery Act 2010 (the “Bribery Act”). In either event.

distribute dividends or otherwise expatriate capital using the official Venezuelan exchange rate. respectively.S. resulting in a corresponding foreign exchange loss.In Venezuela.S.S. Accordingly. net in our consolidated statement of operations for 2010.30 Venezuelan bolivares to the U. of approvals from CADIVI to convert bolivares to U. We received approval to purchase the bonds and sold these bonds immediately upon receipt at a price of $8 million paid in U. Subject to the limitations and restrictions imposed by the BCV. and is also subject to the availability of foreign currency within the guidelines set forth by the National Executive Power for the allocation of foreign currency. net in our consolidated statement of operations for 2010. Some approvals have been issued within a few months while others have taken more than one year. The loss of $2 million was included in other income (expense). we have not executed any exchanges through SITME.30 for goods and services deemed “non-essential” and 2.S. to exchange bolivares pursuant to an official process that requires application and government approval. a new regulated currency trading system controlled by the BCV. if we were to determine in the future that the SITME rate was the more appropriate rate to use to measure bolivar-based assets. we would incur currency exchange losses in the period of conversion based on the difference between the official exchange rate and the SITME rate. During 2010 and 2009.S.S. liabilities and transactions.S.S. 2010. Dollardenominated bonds at par value in connection with our currency exchange risk mitigation efforts. If we were to successfully avail our self of the SITME process to convert a portion of our Venezuelan subsidiary’s cash balances into U. In June 2010.60 for goods and services deemed “essential”. Dollar. This devaluation reduced our net monetary assets (including unrestricted cash and cash equivalents) by approximately $27 million based on the bolivares balances as of such date. Dollars. Effective January 12. entities domiciled in Venezuela may access the SITME by buying U. included in other expense. At December 31. we received $9 million and $7 million. In 2010. Dollar. Approvals under the CADIVI process have been less forthcoming at times. To date. This change had no effect on the carrying value of our cash and cash equivalents. Dollar denominated securities through banks authorized by the BCV. the Transaction System for Foreign Currency Denominated Securities (“SITME”). As indicated above. 34 . application and approval process.15 Venezuelan bolivares to the U. Dollars. the acquisition of foreign currency by Venezuelan companies to honor foreign debt. the conversion of bolivares into foreign currencies is limited by the current exchange control regime. We use the official rate to record the assets. an agency of the Venezuelan government. resulting in a significant buildup of excess cash in our Venezuelan subsidiary and a significant increase in our exchange rate and exchange control risks. we participated in a debt auction held by the Venezuelan government and used bolivares to purchase $10 million of U. 2010. 2011. the Venezuelan government devalued the Venezuelan bolivar.30 bolivares to the U. Dollar exchange rate established by the Venezuelan Central Bank (“BCV”) and the Venezuelan Ministry of Finance has historically attributed to the bolivar a value significantly greater than the value that prevailed on the former unregulated parallel market. we had $14 million of obligations registered and subject to approval by CADIVI for the conversion of bolivares into foreign currencies. the Venezuelan government further increased the official rate for goods deemed “essential” to 4. 2010. Dollar to 4. We cannot predict the timing and extent of any CADIVI approvals to honor foreign debt. Dollars at both the essential and non-essential official rates. In an attempt to control inflation. which resulted in an approximate 25% discount. on May 18. liabilities and transactions of our Venezuelan subsidiary. The official rate increased from 2. pay dividends or otherwise expatriate capital is subject to either the limitations and restrictions of the SITME or the CADIVI registration. The official rate is the rate used by the Comisión de Administración de Divisas (“CADIVI”). the official bolivares—U.S. Effective January 1. The purpose of the new regulated system is to supplement the CADIVI application and approval process with an additional process that allows for quicker and smaller exchanges. reported results would be further adversely affected. commenced operations and established an initial weighted average implicit exchange rate of approximately 5. the Venezuelan government announced that the unregulated parallel currency exchange market would be shut down and that the BCV would be given control over the previously unregulated portions of the exchange market. Additionally.

operating income and operating cash flows could be materially affected. future revenues.S. As of December 31. any changes to the political and economic conditions in certain Latin American countries could materially and adversely impact our future business. the country’s telecommunications regulatory authority.S. have contributed to economic uncertainty at times in most Latin 35 . Inflation and certain government measures to curb inflation in some Latin American countries may have adverse effects on their economies. In addition. the Venezuelan National Assembly issued an Enabling Law allowing the President of Venezuela to carry out the nationalization of certain businesses in the electricity and energy sectors. Dollars and $33 million were denominated in Venezuelan bolivares at the CADIVI rate. In addition. A statement from the Venezuelan minister of telecommunications and director of the Comisión Nacional de Telecomunicaciones. has indicated that the nationalization of CANTV does not imply the nationalization of the telecommunications sector as a whole. Volatility in regional currencies and capital markets could also have an adverse effect on our ability and that of our customers to gain access to international capital markets for necessary financing. Brazil and Argentina. approximately $37 million (valued at the fixed official CADIVI rate of 4. As events in the Latin American region have demonstrated. as well as Venezuela’s largest telecommunications company. Governmental actions taken in an effort to curb inflation. this recovery remains fragile. in each case based on the CADIVI rate. and we cannot predict the impact of such amendments to our business. Compañía Anónima Nacional Teléfonos de Venezuela (“CANTV”). Dollars and held outside of Venezuela) may be transferred to GCL in the form of loans. in January 2007. CADIVI or SITME). advances or cash dividends without the consent of a third party (i. Brazil. approved an amendment to the nation’s constitution removing presidential term limits.S. Since we tend to incur costs in the same currency in which we realize revenue. including Venezuela. operations. our Venezuelan subsidiary had $70 million of net assets. Furthermore. While certain areas in the Latin American region have experienced economic growth. including Argentina. events in recent years in other developing markets have placed pressures on the stability of the currencies of a number of countries in Latin America in which we operate.S. Colombia and Venezuela. Dollar appreciates significantly. Appreciation of the U. As of December 31. In addition. For example. none of these net assets (other than the $4 million of cash denominated in U. 2010. have historically experienced high rates of inflation. a referendum held on February 15.S.S. Economic and political conditions in Latin America pose numerous risks to our operations. However.As of December 31. Dollar adversely impacts our consolidated revenue. Dollar relative to foreign currencies reduces the U. negative economic or political developments in one country in the region can lead to or exacerbate economic or political instability elsewhere in the region.30 Venezuelan bolivares to the U. Inflation and some measures implemented to curb inflation have had significant negative effects on the economies of these countries. Dollar value of cash balances held in those currencies. the appreciation of the U.. if the U. Dollar at December 31. CANTV was nationalized in the same year. For 2010. refinancing and repatriation of earnings. 2010.S. Pressures on local currencies are likely to have an adverse effect on our customers. including our business. 2010 (“the “CADIVI rate”)) of our cash and cash equivalents was held in Venezuelan bolivares. The government also announced plans to modify the telecommunications law. However. Some Latin American countries.e. We conduct a significant portion of our business using the British Pound Sterling. there can be no assurance that such nationalization plans will not also extend to other businesses in the telecommunications sector. the Euro and the Brazilian Real. the impact on operating income and operating cash flow is largely mitigated. financial condition and results of operations. coupled with speculation about possible future actions. our business and our operations. In light of the Venezuelan exchange control regime. 2010. These amounts do not include any allocated corporate overhead costs or transfer pricing adjustments. 2009. Our business operations in the Latin American region constitute a material portion of our business. our Venezuelan subsidiary had $37 million of net monetary assets of which $4 million were denominated in U. our Venezuelan subsidiary contributed approximately $52 million of our consolidated revenue and $30 million of our consolidated OIBDA.

Similarly. A high inflation environment would also have negative effects on the level of economic activity and employment and adversely affect our business. if any of these countries experience high rates of inflation. Thus. If GCUK’s noteholders have the right to control GCUK or the majority of GCUK’s assets upon such event. 36 . A termination in many instances gives rise to other rights of the government customer. Similarly. Government together represented approximately 51%. we could experience a material and adverse effect on our business. including upon bankruptcy.K. including. Accordingly. 49% and 47% of the GCUK Segment’s revenues in 2010. Many of GCUK’s government contracts contain broad change of control provisions that permit the customer to terminate the contract if GCUK undergoes a change of control. future price decreases could be greater than we are anticipating. Various agencies of the U. These countries may experience high levels of inflation in the future that could lead to further government intervention in the economy. respectively. results of operations and financial condition. If any of GCUK’s significant government contracts were terminated as a result of a change of control. 2009 and 2008. results of operations and financial condition. GCUK’s contract to provide the FTN expired in May 2010. the right to purchase some of GCUK’s assets used in servicing those contracts. in some cases. If the prices for our services decrease for whatever reason and we are unable to increase profitable sales volumes through additional services or otherwise or correspondingly reduce operational costs. In addition. most of GCUK’s government contracts do not include significant minimum usage guarantees. and we expect that such decreases will continue over time. it could be deemed to be an indirect change of control of GCUK. it could be deemed to be a change of control of GCUK. our operating results would be adversely affected. to whom GCUK provides an international telecommunications network known as the FTN. Risks Related to Competition and Our Industry The prices that we charge for our services have been decreasing. One of GCUK’s principal customer relationships is with the UK Foreign and Commonwealth Office (“FCO”). Many of our most important government customers have the right to terminate their contracts with us if a change of control occurs or to reduce the services they purchase from us. In addition. we could experience a material and adverse effect on our business.American countries. We expect overall price erosion in our industry to continue at varying rates based on our service portfolio and reflective of marketplace demand and competition relative to existing capabilities and availability. results of operations and financial condition. including the introduction of government policies that could adversely affect our results of operations. GCUK has entered into transition arrangements in respect of the FCO’s migration to a network to be provided by a competitor as the replacement for the FTN. we may not be able to adjust the price of our services sufficiently to offset the effects of inflation on our cost structures. our historical revenues are not indicative of future revenues based on comparable traffic volumes. In addition. the applicable customers could simply choose not to use GCUK’s services and move to another telecommunications provider. Some change of control provisions may be triggered when any lender (other than a bank lender in the normal course of business) or a noteholder or group of noteholders would have the right to control GCUK or the majority of GCUK’s assets upon any event. If the applicable customers of any of GCUK’s significant government contracts were to significantly reduce the services that they purchase under these contracts. we continue to pursue other ordinary course commercial opportunities with the FCO. We estimate our 2011 revenue to be adversely impacted by between $10 million to $15 million. if ST Telemedia’s ownership interest in Global Crossing falls below certain levels.

which could increase the competition we face and put downward pressure on prices. In the U. and regulatory changes are blurring the distinctions between traditional and emerging telecommunications markets. and devote greater resources to the development. In certain instances. results of operations and financial condition could be materially adversely affected. and significantly larger installed customer bases. which could place us at a cost and price disadvantage. microwave carriers. These new services are intended to allow us to address new segments of the communications marketplace and to compete for additional customers. Many of these advantages are expected to increase with the trend toward consolidation by large industry participants. If we are not able to compete effectively with any of these industry participants. To the extent that upgrades of existing technology are required for the introduction of new services. marketing and sale of products and services than we can. at this time. Also. take advantage of acquisition and other opportunities (including regulatory changes) more readily. our business. many of our competitors can raise capital at a lower cost than we can. If our new service offerings are not widely accepted. and they may be able to adapt more swiftly to new or emerging technologies and changes in customer requirements. As a result. including greater market presence. we may terminate those service offerings and we may be required to impair any assets or technology used to develop or offer those services.. Individual and collective regulatory decisions could have negative effects on our U. Continued industry consolidation could further strengthen our competitors and adversely affect our prospects. If we are not able to successfully complete the development and introduction of new services in a timely manner. cable television companies. Our competitors’ financial advantages may give them the ability to reduce their prices for an extended period of time if they so choose. our competitors’ greater brand name recognition may require us to price our services at lower levels in order to win business. Failure to develop and introduce new services could affect our ability to compete in the industry.K. it is not possible to predict the future effect on market conditions or investment returns. we could face competition from other companies. new service offerings may not be widely accepted by our customers. or if this competition places excessive downward pressure on prices. results of operations and financial condition. is currently considering the regulation of access to passive infrastructure such as ducts and poles and the terms under which interconnection of networks at the IP layer should be regulated to best achieve the Government’s policy objective. New and relatively new technologies. We face competition in each of our markets from the incumbent carrier in that market and from more recent market entrants. such as other competitive carriers. Many of our existing and potential competitors have significant competitive advantages. name recognition and financial. 37 . business. our operating results would be adversely affected.K. the success of these upgrades may be dependent on reaching mutually acceptable terms with vendors and on vendors meeting their obligations in a timely manner. which could materially and adversely affect our consolidated business. such as VoIP. technological and personnel resources. superior engineering and marketing capabilities. more ubiquitous network reach. The introduction of new technologies may reduce the cost of services similar to those that we plan to provide and create significant new competitors with superior cost structures. wireless telephone system operators and private networks built by large end-users or municipalities. a competitor in any of our business areas is potentially a competitor in our other business areas. Many of our competitors have superior resources. the introduction of new services requires the successful development of new technology. the Government launched a plan in December 2010 aiming to ensure that every community will have access to “superfast broadband” services by 2015. The regulator. We continuously develop. In addition. Each of OFCOM’s initiatives and others may impact our business but. As a result.Technological advances and regulatory changes are eroding traditional barriers between formerly distinct telecommunications markets. In addition. OFCOM. test and introduce new communications services that are delivered over our communications network.

regulatory or other forums are available to address these inadequacies or disputes. Our failure to obtain or maintain necessary licenses. European Union). Significant terrorist attacks against the U. ineffective or unacceptably costly. in general or particular to our industry. those regulatory requirements could change in a manner that significantly increases our costs or otherwise adversely affects our operations. license fees. in part.g. Our operations are subject to regulation in each of the countries in which we operate and require us to obtain and maintain a number of governmental licenses and permits. or if the technology choices we make prove to be incorrect. which would have a material adverse effect on our business. railroads. is unclear or inconsistent. If we do not replace or upgrade technology and equipment that becomes obsolete. In other countries. may result in sanctions or additional costs. and may have a material adverse effect on our business. environmental.S. incumbent carriers and other persons. If we fail to comply with those regulatory requirements or to obtain and maintain those licenses and permits. Due to the political and economic risks associated with the countries in which we operate. We cannot be certain of the outcome of these proceedings. The future success of our business will depend. We also must comply with a variety of regulatory obligations. including payment of related fees. including the revocation of authority to provide services in one or more countries. may increase costs and restrict operations. Terrorist attacks and other acts of violence or war may adversely affect the financial markets and our business and operations. if any. which would limit our ability to compete effectively. These proceedings may affect the manner in which we are permitted to provide our services in these countries as well as the level of fees and taxes payable to the government. Moreover. many of the countries in which we operate are conducting regulatory or other proceedings that will affect the implementation of their telecommunications legislation. the U. as well as rights-of-way from utilities. Our inability or failure to comply with the telecommunications and other laws and regulations of one or more of the countries in which we operate could result in the temporary or permanent suspension of operations in one or more countries. the national level (e. in many cases. provincial. or is applied in an unequal or discriminatory fashion. evolving industry standards.. changing customer needs. we cannot assure you that we will be able to maintain our licenses or that they will be renewed upon their expiration. or other countries in which we operate are possible. or to comply with the obligations imposed upon license holders including the payment of fees. at the state. health and safety. we will be unable to compete effectively because we will not be able to meet the expectations of our customers. existing telecommunications legislation is in the process of development. privacy and other regulatory changes. In some countries. the range of services that we are legally permitted to provide may be limited. In the ordinary course of constructing our networks and providing our services we are required to obtain and maintain a variety of telecommunications and other licenses and authorizations in the countries in which we operate. The telecommunications industry is subject to rapid and significant changes in technology.g. We also may be prohibited from entering certain countries at all or from providing all of our services in one or more countries. or inadequate judicial. results of operations and financial condition. Terrorist attacks (or threats of attack) also could lead to volatility or illiquidity in world 38 . In addition. results of operations and financial condition. The regulation of telecommunications networks and services around the world varies widely. we may not be able to conduct our business.K.Our selection of technology could prove to be incorrect. and local levels. Regulations or rules on network neutrality.. ineffective or unacceptably costly. in one or more countries. Our operations around the world are subject to regulation at the regional level (e. It is possible that our physical facilities or network control systems could be the target of such attacks or that such attacks could impact other telecommunications companies or infrastructure or the Internet in a manner that disrupts our operations. authorizations and rights-of-way. emerging competition and frequent new product and service introductions. on our ability to adapt to these factors in a timely and cost-effective manner. FCC) and.

As of February 1. and amendments to our articles of association and bye-laws. 2011. total equity interests held by non-U.e.2% of our capital stock.. a wholly-owned subsidiary of ST Telemedia.000 shares of common stock reserved for issuance upon the conversion of our outstanding convertible preferred stock. each of which may negatively affect the market price of our shares and impact our ability to raise capital.S. ST Telemedia is our majority stockholder. the purchase of a substantial amount of common shares by our affiliates. Although the shares beneficially owned by STT Crossing are not freely transferable under the Securities Act. results of operations and financial condition. beneficially owned over 60. STT Crossing. Risks Related to our Common Stock We have a very substantial overhang of common stock and a majority shareholder that owns a substantial portion of common stock and securities convertible into our common stock. In addition.financial markets and could otherwise adversely affect the economy. without limitation. 18.000. the availability of shares of common stock for future sale. a subsidiary of ST Telemedia owns over 60. We cannot predict the effect. Uninsured losses as a result of such attacks could have a material adverse effect on our business. These rights effectively dilute the rights of other shareholders. Although we monitor foreign ownership in our capital stock. Ownership of GCL’s common stock is governed in part by the Communications Act of 1934. which cannot exceed 66. as amended. 2011. Other than ownership by ST Telemedia and its affiliates.672.25% without prior FCC approval. or the perception that such sales or acquisitions could occur. issuances of additional equity securities (with certain enumerated exceptions). that future sales of shares of our common stock into the market. the making of capital expenditures in excess of specified amounts. ST Telemedia has the power to elect the majority of GCL’s directors. Federal law generally prohibits more than 25% of GCL’s capital stock to be owned by foreign persons. As a result. may materially and adversely affect prevailing market prices for our common stock and impact our ability to raise capital. As of February 1. GCL’s bye-laws include significant additional corporate governance rights of ST Telemedia. persons) generally cannot exceed 25% without prior FCC approval. As of February 1. These events could adversely affect our business and our ability to obtain financing on favorable terms. or any acquisition of common shares by ST Telemedia and its affiliates will have on the market price of our common stock.2% of GCL’s outstanding capital stock. if any. GCL’s articles of association and bye-laws and the certificate of designations for GCL’s preferred stock. Sales of substantial amounts of common stock (including shares issued upon the exercise of stock options or conversion of any convertible securities). Under applicable law. 2011. certain acquisitions and dispositions. 39 . incurrences of indebtedness above specified amounts. We also have a significant number of shares of common stock reserved for issuance upon the exercise of outstanding stock options and vesting of unvested restricted stock units (see Item 5. we cannot necessarily detect or control it and could be subject to governmental penalties if trading in our capital stock resulted in foreign ownership in excess of 25% without prior FCC approval. it is becoming increasingly difficult and expensive to obtain adequate insurance for losses due to terrorist attacks.946 shares of our common stock outstanding. there were 60. “Market for Registrant’s Common Stock and Related Stockholder Matters—Equity Compensation Plan Information”). certain actions cannot be taken without the approval of holders of a majority of our voting stock including. Future sales of our common stock by our majority shareholder could significantly increase the market supply of such shares and future acquisitions by our majority shareholder will decrease the liquidity of our common stock. mergers. ST Telemedia has the contractual right to require us to register sales of such restricted stock at any time. foreign ownership of GCL’s capital stock (i.

Florida. the requirement that we offer to purchase the 12% Senior Secured Notes. or only limited recourse to the entity from which the business was acquired (or its stakeholders). Colombia. Dublin. If one or more of these legal proceedings or contingent liabilities were to be resolved in a manner adverse to us. administrative. New York. and financial condition. New York. New Jersey. and Sao Paulo. the calculation of which involves significant estimation. Venezuela. results of operations and financial condition could be materially adversely affected. Montreal. Santiago. The Netherlands. and Westminster. Naarden. Michigan. Bermuda. or may acquire in future acquisitions. Lima. may be subject to unknown or contingent liabilities for which we may have no recourse. and support offices within their respective geographic regions: • • • GCUK Segment: London. could result in substantial costs and diversion of resources that could have a material adverse effect on our business. Contingencies and Other. Florida. We are a party to various legal proceedings and are subject to certain important contingent liabilities described more fully in Note 19. ITEM 2. 2010. ITEM 1B. Furthermore. Buenos Aires. the 9% Senior Notes and the GCUK Notes at a price equal to 101% of their outstanding principal amounts plus accrued and unpaid interest.” to our consolidated financial statements included in this annual report on Form 10-K. As of December 31. Canada. Southfield. Colorado 40 . Certain of these contingent liabilities could have a material adverse effect on our business. Brazil ROW Segment: Billings.K. Miami. Ireland. our real estate restructuring reserve related to 2003 and prior restructuring plans aggregated $73 million of continuing building lease obligations and broker commissions. results of operations. Basingstoke and Crewe. PROPERTIES We lease our principal executive offices in Hamilton. Chile. Milan. actual sublease receipts could turn out to be materially less than we have estimated. Phoenix. China. Our real estate restructuring reserve represents a material liability. Although we believe these estimates to be reasonable. results of operations and financial condition in addition to the effect of any potential monetary judgment or sanction against us. England GC Impsat Segment: Bogota. Italy. results of operations and financial condition. Ecuador. UNRESOLVED STAFF COMMENTS None. Japan. France. Caracas. Montana. government customers. including those related to Impsat. and the acceleration of the vesting of stock options and other incentive compensation awards granted to our directors and employees. Hong Kong. New York. Argentina. “Commitments. Paris. Our operating segments also lease significant corporate office space in the following cities and lease smaller sales. that could result in material losses that we have not reserved against. any legal proceedings. offset by anticipated receipts of $48 million from existing subleases and $16 million from subleases projected to be entered into in the future. Quito. Assets and entities that we acquired in the Impsat and Genesis Networks transactions.A sale by ST Telemedia of a significant portion of its shareholdings in us could trigger contractual provisions tied to a change in control of our company. we could suffer losses that are material to our business. Miami. Tokyo. in which case our business. For example. a change in control could result in the termination of significant contracts with U. regardless of the outcome. We have not established reserves for many of these contingent liabilities and those for which reserves have been established could be adversely resolved at levels exceeding the reserved amounts. Rochester. Arizona. Other Risks We are exposed to legal proceedings and contingent liabilities. Florham Park. Peru.

see above in Item 1. our switching equipment and connecting lines between other carriers’ equipment and facilities and the equipment and facilities of customers in each of our principal operating segments. Contingencies and Other. Our existing properties are in good condition and are suitable for the conduct of our business.We own or lease numerous cable landing stations and telehouses throughout the world related to undersea and terrestrial cable systems.” to our consolidated financial statements included in this annual report on Form 10-K. ITEM 4. we own or lease properties to house and operate our fiber-optic backbone and distribution network facilities. (REMOVED AND RESERVED) 41 . For information regarding legal proceedings in which we are involved. ITEM 3. For additional information on our technical sites. Furthermore. our point-to-point distribution capacity. we are party to various legal proceedings in the ordinary course of business or otherwise. “Business—Overview of Our Business—Our Network”. “Commitments. see Note 19. LEGAL PROCEEDINGS From time to time.

. . . . MARKET FOR REGISTRANT’S COMMON STOCK AND RELATED STOCKHOLDER MATTERS Market Information The table below sets forth. . On May 30. .53 $10. . 2006. . . . . . . . . . 2011.PART II ITEM 5. . . on August 27. . .03 $ 5. . . . . . . . . . . . . . Second Quarter 2010 . .79 $15. . .1 million common shares have been issued under the 2003 Global Crossing Limited Stock Incentive Plan (the “2003 Stock Incentive Plan”). . . . 18. .000 preferred shares. .02 $ 7. . . . on December 9. . . . . . . . . . . . . . . . . . . . . . . . . . .02 $12. . .86 $11. . . . . . . . . . . . . STT Crossing Ltd effectively converted the $250 million of senior secured mandatory convertible notes then held by it into approximately 16. . .000 common shares were reserved for the conversion of ST Telemedia’s preferred shares. restrictions under Bermuda law. . . . . . . Description of Global Crossing Equity Securities GCL is authorized to issue 110. . . 42 . . . . . . . Such issuance of common shares to STT Crossing was effected through a private placement under Section 4(2) of the Securities Act. . . . . . . . . . operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . stock options and restricted stock units covering approximately 6. . .000 common shares to our pre-petition creditors and 6. Through February 1.30 GCL has not declared or paid dividends on its common stock. . contractual restrictions (including the preferential cumulative dividend rights of the holders of GCL’s preferred shares). . . . . . . . . . . . . GCL issued an additional 12 million shares and $144 million aggregate principal amount of 5% Convertible Notes in a public offering. . . . . . In addition. . . . .19 $17. . . . . . . . “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Indebtedness. . . . . Third Quarter 2010 . . . and we do not expect it to do so for the foreseeable future. . . .40 $10. . . . and approximately an additional 2. . . . Third Quarter 2009 . . In addition. . . . . . . . Fourth Quarter 2010 . . . . . . . GCL issued 15. . . . . . .000. . . Pursuant to the GC Debtors’ plan of reorganization.52 $15. . . . . . . . . . . . . . . The payment of future dividends.75 $13. 2011. . . . . . . . . 2010. . . . . . . As of February 1. . . . . . . . . . . . . . . . . . . . . . on a per share basis for the periods indicated the intra-day high and low sales prices for GCL’s common shares as reported by the Nasdaq Global Market for each quarter of 2009 and 2010. . . capital requirements and surplus. which is filed as an exhibit to this annual report on Form 10-K. . 2003. . . . . .000.06 $ 6. . . . . . . . . . . . . . . . . . . .2 million common shares remained outstanding under the 2003 Stock Incentive Plan. . . . . . .58 million shares of common stock. . .000. . . . . . . 2007. . The 5% Convertible Notes were redeemed on December 16. . . . . .000. . . . . . . will be at the discretion of GCL’s board of directors and will depend upon.7 million common shares are reserved for future awards to be granted under the plan. . . . . . . . . .95 $15. . . .” for a discussion of such restrictions. . . . loans or advances. . . . There were 411 shareholders of record of GCL’s common stock on February 1.000 common shares and 45. High Low First Quarter 2009 . . . First Quarter 2010 . . . 2011. . . . . if any. .54 $ 9. . our liquidity. . .000 preferred shares to a subsidiary of ST Telemedia. . approximately 10. . . . . . . . . . . .09 $12. . . . . . Second Quarter 2009 . . . . . . . .50 $16. among other things. . .600. . . general financial condition. . . .400. . and such other factors as our board of directors may deem relevant. . . . Fourth Quarter 2009 . . . covenants in our financing agreements significantly restrict GCL’s ability to pay cash dividends on its common stock and also restrict the ability of GCL’s subsidiaries to transfer funds to GCL in the form of cash dividends. . . . . See Item 7. . . . . . .000 common shares and 18. . Dividends $ 8. . . . . . .

The amended and restated bye-laws of GCL are filed as an exhibit to this annual report on Form 10-K. 2011. Those corporate actions include (i) the appointment or replacement of the chief executive officer. The certificate of designations for the GCL Preferred Stock is filed as an exhibit to this annual report on Form 10-K. 2010 consolidated balance sheet. Further. (ii) material acquisitions or dispositions. The amended and restated bye-laws of GCL contain certain special protections for minority shareholders. as demonstrated in audited consolidated financial statements.10 per share and a liquidation preference of $10 per share (for an aggregate liquidation preference of $180 million). The GCL Preferred Stock ranks senior to all other capital stock of GCL. including certain obligations of ST Telemedia and other third parties to offer to purchase shares of GCL Common Stock under certain circumstances. We also expect thereafter to pay preferred dividends in cash in respect of each subsequent fiscal quarter on or about the fifteenth day following the end of each such fiscal quarter.The following is a brief description of GCL’s common and preferred shares. Global Crossing Preferred Stock The 18. taxes. 2003 through March 31. we expect to pay accumulated preferred dividends of $26 million for the period from December 9. 2003 emergence from reorganization proceedings. provided that any distribution to shareholders following a disposition of all or any portion of the assets of GCL will be shared pro rata by the holders of GCL Common Stock and GCL Preferred Stock on an as-converted basis. The GCL Preferred Stock votes on an as-converted basis with the GCL Common Stock. As long as ST Telemedia beneficially owns a certain minimum percentage of the outstanding GCL Common Stock (calculated after giving effect to the conversion of the GCL Preferred Stock). depreciation and amortization (calculated in accordance with the certificate of designations for the GCL Preferred Stock) of $650 million or more since the GC Debtors’ December 9. The GCL Preferred Stock has a par value of $0. consolidations or reorganizations.000. (vi) capital expenditures in excess of specified amounts. (vii) the commencement of bankruptcy or other insolvency proceedings. (v) incurrence of indebtedness above specified amounts. the certificate of designations for the GCL Preferred Stock requires its approval for certain major corporate actions of GCL and/or its subsidiaries. 2010 is included in other current liabilities on our December 31.000 shares of GCL Preferred Stock issued to a subsidiary of ST Telemedia on December 9. and (viii) certain affiliate transactions. (iv) issuance of additional equity securities (other than enumerated exceptions). The portion of such preferred dividends accumulated through December 31.01 and entitles the holder thereof to one vote on all matters to be approved by stockholders. 43 . Global Crossing Common Stock Each common share of GCL (“GCL Common Stock”) has a par value of $. Since this target was achieved during 2010. (iii) mergers. but has class voting rights with respect to any amendments to the terms of the GCL Preferred Stock. ST Telemedia has the right to designate up to eight directors to our Board based upon their current percentage ownership. 2003 pursuant to the GC Debtors’ plan of reorganization accumulate dividends at the rate of 2% per annum. 2011 in cash on or after April 15. Those dividends are payable in cash only after GCL and its subsidiaries achieve cumulative operating earnings before interest. Each share of GCL Preferred Stock is convertible into one share of GCL Common Stock at the option of the holder.

. . . .00 $13. . . . . . . . .Equity Compensation Plan Information Table of Securities Authorized for Issuance Under Equity Compensation Plans The following table sets forth the indicated information regarding our equity compensation plans and arrangements as of December 31. . . . . . . . . . . .65 $15. . . . . . . April 2010 . .42 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 44 . October 2010 . . . . . . . . . . . . warrants and rights Weighted-average exercise price of outstanding options. . . . . .00 $ 0.00 $13. . . . . . . . . . . . . . . . . . . . .002 outstanding restricted stock unit awards and 2. . . . . . . . February 2010 . .254 performance share awards. . . . .00 $ 0. . . . . September 2010 . . . . . . . . . . .171. . . . . . . . . . .621. . . 2010. . . Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs Period Total Number of Shares Purchased Average Price Paid per Share January 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . .00 $ 0. . . . . . . . . . May 2010 . . . . .45 $10. . . December 2010 . .00 $15. . . . . . .462 0 1.474 — 3. . . Total . . . . . . .474 The weighted-average exercise price does not take into account the shares issuable upon vesting of 2. . . . . . . . . . . March 2010 . . . . warrants and rights(1) Number of securities remaining for future issuance under equity compensation plans Plan category Equity compensation plans approved by security holders . . . . . . . . . . . . .485. . .00 $ 0. . Equity compensation plans not approved by security holders . . . . . (1) 5. . . . . . . . . . .54 — $11. . . . . . . . . .159 654 328 0 0 0 0 0 50.63 $ 0. . . . . . . . .485. . . . . .54 3. . .670 — 5. . . . .42 $12. . . . . . . . August 2010 . . . . . Purchases of Equity Securities The following table sets forth the indicated information for all purchases made by or on behalf of us of our common stock during 2010. . . . . . .670 $11. . . . . .55 $ 0. . . . . which have no exercise price. . . . . . . . . 0 201 48.393. . June 2010 . . .804 $ 0. . . . All such purchases were made to comply with tax withholding requirements related to the vesting or exercise of stock-based awards granted to participants under the 2003 Global Crossing Limited Stock Incentive Plan. . . . including weighted average price paid per share. . . Number of securities to be issued upon exercise of outstanding options. . . . . . . . .621. . . . . . . . November 2010 . . . . . . . . . July 2010 .

. SELECTED FINANCIAL DATA The table below presents our selected consolidated financial data as of and for the five years ended December 31. . .995 (2. . . .132 227 198 172 193 26 2. . . . . $ Shares used in computing basic and diluted loss per share . 2008 2007 (in millions) 2006 Balance Sheet data: Cash and cash equivalents . . . Total shareholders’ deficit . . . . . . . . . . .16) $ 55. . . . Net loss . .867 (7. . . . . net . .609 $ (1. .310 2. . . . . . . . . . .45) $ 59. .290. . .338 1. . . . . .871 (1. . . . . . . . . . . . . .300 1. Net gain on pre-confirmation contingencies . . . . . . . basic and diluted: Loss applicable to common shareholders. . . . . . . . . .536 $ (1. except share and per share information) 2006 Statements of Operations data: Revenue . . . . . . . . . . . . . . . . . . . . .332 1. . . . . . . . . . .153. .179 1. . . . . . . . .265 $ (1.771.728) (414) (264) (141) (177) 33 (63) (312) (316) 1. . . . . . . .44) $ 42. . . . . . Loss per common share. . . . .349 2. . . . . . .ITEM 6. . Selling. . .488 2. . . . . . . . . . . . . . . . . . . . . . . . Loss applicable to common shareholders . . . . . . . . . . . . . .766) (428) (340) 2 (160) — (1) (141) (145) 2. . . . . . .153 1. . . . . . .418. . Depreciation and amortization .578) (342) (163) (212) (110) 32 (67) (328) (331) (2. . . . . . . . . .054 1. . . . . . Total assets . . . . . . . 2. . . . . .355 (5. . .853 (10. . . 2010. . . . . . Benefit (provision) for income taxes . . . . . . . . . . net . . . . . .778) (431) (337) 63 (191) — 5 (172) (176) 2. . Operating income (loss) . . . . . . . . . . . 2009 2008 2007 (in millions. . . . . . basic and diluted . . . . Capital leases (including current portion) . . . . . . . . .246 913 123 139 145 177 138 (477) (360) (246) (35) (161) 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91) $ 60. . . . 2010 Year Ended December 31. . . . .666 2. .280 1. . . Working capital deficit . . . . . . . . 2010 and 2009 and for the years ended December 31. . . . The historical financial data as of December 31. . . . . . .461. . . . . . Goodwill and intangibles. . .62) 31. . . . . . . . 2009 and 2008 have been derived from the historical consolidated financial statements presented elsewhere in this annual report on Form 10-K and should be read in conjunction with such consolidated financial statements and accompanying notes. . . . $ 372 $ 477 $ 360 $ 397 $ 459 (222) (128) (153) (114) (99) 1. . Interest expense . . .467 1. . . . . . .599 $ (1. . . . . . . . . . . . . Property and equipment. . . . . . . .835) (491) (326) (53) (176) 10 (49) (284) (288) 2. . Short term and long term debt (including current portion) . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010. . . . . . . . . . general and administrative expenses . . . . . . . . .152 2010 2009 December 31. . . $ Cost of revenue . .

. . . the Venezuelan government devalued the Venezuelan bolivar. the remaining $125 million was used for general corporate purposes. . . .60 for goods and services deemed “essential”. .30 Venezuelan bolivares to the U. professional fees and other transactions fees and expenses in connection with the offering. . Effective January 1. . The acquisition of Genesis Networks will enable us to provide value-added solutions to address specialized video transmission requirements across multiple industries. (168) (168) (146) (330) (157) Net cash provided by (used in) financing activities . Goldman Sachs Partners L. On October 29. . . . . 2010. . . 2009 2008 2007 (in millions) 2006 Cash flow data: Net cash provided by (used in) operating activities . . The results of Genesis Networks’ operations are included in our consolidated financial statements commencing on October 29. We paid a purchase price for Genesis Networks of approximately $8 million and repaid a portion of the debt and other liabilities assumed as part of the acquisition for total consideration including direct costs of $27 million. please note the following: • On November 16. 2011. . . . (25) 3 (19) 1 7 In reading the above selected historical financial data. On September 22.2010 Year Ended December 31. 2010. . . . . . . net in our consolidated statement of operations is a charge of approximately $29 million recorded in connection with the early extinguishment of the GC Impsat Notes and the Term Loan Agreement. 2017 of GC Impsat (the “GC Impsat Notes”) that were validly tendered in a tender offer for such notes. net in our consolidated statement of operations for 2010 is a charge of $6 million recorded in connection with the early extinguishment of the 5% Convertible Notes. (95) 26 (75) 283 455 Effect of exchange rate changes on cash and cash equivalents . . the Venezuela government further increased the official rate for goods and services deemed “essential” to 4. and Credit Suisse Securities (USA) LLC (the “Term Loan Agreement”) together with a 1% prepayment penalty and unpaid interest to but not including the date of repayment (total cost of $348 million). producers and aggregators of specialized programming. . . . . among us. . dated as of May 9. . 2010.S. After these costs.875% senior notes due February 15. we acquired 100% of the capital stock of Genesis Networks Inc. . $ 183 $ 256 $ 203 $ (16) $ (70) Net cash used in investing activities .P. . . we issued $150 million aggregate principal amount of 9% senior notes due November 15. . . 2010. including a consent fee of 5% of the principal amount of those notes tendered by the early withdrawal date (total cost of $237 million). we issued $750 million in aggregate principal amount of 12% senior secured notes due 2015 (the “12% Senior Secured Notes”) at an issue price of 97. . 46 • • • . (“Genesis Networks”). . . The Genesis Networks network connects 70 cities on five continents and links important international media centers through 225 on-net points. . (ii) purchase all of the 9. . professional fees and other transaction fees and expenses in connection with the offering. Dollar. . . The official rate increased from 2. . . We used proceeds from the issuance of the 12% Senior Secured Notes to: (i) repay in full the loan outstanding under the Credit and Guaranty Agreement. . 2019 (the “9% Senior Notes”) at an issue price of 100% of their par value. . . . This change had no effect on the carrying value of our cash and cash equivalents (see “Currency Risk” in Item 7 for further information related to foreign currency exchange restrictions and the impact of the devaluation of the Venezuelan bolivar). certain of our subsidiaries. .944% of their par value. . Dollar to 4. and (iii) pay the estimated initial purchaser discounts. This devaluation reduced our unrestricted cash and cash equivalents during the three months ended March 31. . .15 Venezuelan bolivares to the U. . . . and (ii) pay the estimated initial purchaser discounts. . . . serving many of the world’s major broadcasters. . . 2009. . a privately held company providing high performance rich media and video-based applications. 2007. Effective January 12.S. . We used the proceeds from the issuance of the 9% Senior Notes to: (i) redeem the 5% convertible senior notes due 2011 (the “5% Convertible Notes”) at an optional redemption price equal to 101% of their principal amount. . Included in other income (expense).30 for goods and services deemed “non-essential” and 2. 2010 by approximately $27 million. Included in other income (expense). . .

2007. representing a total equity value of approximately $95 million. 2007. The results of Impsat’s operations have been included in our results commencing May 9. GC Impsat. See further discussion under Item 7. 2007 and 2006. As a result of the acquisition. Restructuring plans resulting in employee terminations. During 2007. Due to the purchase. of approximately $111 million. 2006. in conjunction with the recapitalization pursuant to which we entered into the Term Loan Agreement. we acquired Impsat for cash of $9. The total purchase price including direct costs of the acquisition was approximately 52 million pounds sterling (approximately $97 million at the exchange rate at the closing date). On February 14. Excluding those related to acquired businesses which are included as liabilities assumed in our purchase price. $3 million. net. general and administrative expenses. The total purchase price including direct costs of acquisition was approximately $104 million. we issued an additional 52 million pounds sterling aggregate principal amount of 11. 2008. 2004. we acquired Fibernet.• On May 9. 2006. non-taxable gain from the deemed settlement of pre-existing arrangements. 2007. the date we took control of their operations. The additional notes were issued at a premium of approximately 5 million pounds sterling which resulted in us receiving gross proceeds. Impsat is a leading Latin American provider of IP. and cancellation of contracts have resulted in significant restructuring charges (credits). 2007 amended the Term Loan Agreement to provide for the borrowing of an additional $100 million on that date. converted $250 million original principal amount of mandatorily convertible notes due December 2008 into approximately 16. 2006. We recorded a $30 million inducement fee related to the early conversion of STT Crossing Ltd. we have recorded restructuring charges (credits) of nil. “Management’s Discussion and Analysis of Financial Condition and Results of Operations.32 per share of Impsat common stock. a wholly owned subsidiary. before underwriting fees. we released a contingent liability and interest accrued on that liability as a result of a tax court dismissing the claim and recorded a $27 million net gain on settlement of pre-confirmation contingencies and an $8 million reduction in interest expense. we made concurrent public offerings of 12 million shares of common stock and $144 million aggregate principal amount of 5% Convertible Notes for total gross proceeds of $384 million. we recorded a $27 million non-cash. respectively. 2007. issued $225 million in aggregate principal amount of GC Impsat Notes. 2007. STT Crossing Ltd. On May 30. Fibernet’s results of operations have been included in our results since October 11. we are able to provide greater breadth of services and coverage in the Latin American region and enhance our competitive position as a global service provider. hosting and value-added data solutions. closing of real estate facilities. we entered into the Term Loan Agreement pursuant to which we borrowed $250 million on that date and on June 1. Also. $(30) million and $(4) million in the results from operations above in 2010. The notes are additional notes issued under the original GCUK senior secured notes bond indenture dated December 23. These charges (credits) are included in selling. On December 28.” • • • • • • 47 .75% pound sterling senior secured notes due 2014.58 million shares of common stock. On May 9. on August 27. In October 2006. debt to equity in other income (expense). 2009. $4 million. Fibernet is a provider of specialist telecommunications services to large enterprises and other telecommunications and internet service companies primarily located in the United Kingdom and Germany.

These factors could cause our actual results to differ materially from the forward-looking statements. as well as 700 carriers. governments. Latin America. Third. and a portion of the Asia/Pacific region. and have 17 data centers located in major business centers. with smaller operations in Europe. See Item 1A.ITEM 7. Second. This segment also includes our subsea fiber optic network. we are focused on the following target markets: medium-to-large enterprises including multinationals.0 companies. Our operations are based principally in North America. “Business—Business Strategy. First. uncertainties and other factors that could cause the actual results to differ materially from those contemplated by the statements. “Segment Reporting. We will continue to improve our cost structure by aggressively managing our operating and third party costs. We report our financial results based on three separate operating segments: (i) the GCUK Segment which provides services to customers primarily based in the U. our solutions are based on IP and Ethernet technologies that cover the full range of service offerings typically deployed by customers in our target markets. and we will continue our efforts to maintain a motivated. We deliver converged IP services to more than 700 cities in more than 70 countries.” our strategy is based on four key elements. Industry. 48 . and (iii) the Rest of World (“ROW”) Segment which represents all our operations outside of the GCUK Segment and the GC Impsat Segment and operates primarily in North America. We also intend to leverage our innovation and focus on IP and Ethernet services to capture the customer demand created by the convergence of legacy protocols to fixed. including data center and cloud services. Europe. We intend to invest in our core network.” for risk factors that should be considered when evaluating forward-looking information detailed below. For 2011. We offer a full range of data. In addition. See below in this Item 7 and Note 21. Strategy and Certain Key Risks As described more fully in Item 1. Web2. Executive Summary Overview We are a global communications service provider. we have set a number of operational imperatives intended to improve the pace of our revenue growth. enthusiastic and talented work force.K. Fourth. mobile and unified communications.. Latin America and a portion of the Asia/Pacific region. broadcast and media providers and telecommunications carriers. and continue moving up the value chain with accelerated investment in managed solutions. Some of the statements contained in the following discussion of our financial condition and results of operations refer to future expectations and business strategies or include other “forward-looking” information. (ii) the GC Impsat Segment which provides services to customers in Latin America. “Risk Factors. Those statements are subject to known and unknown risks. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read together with our consolidated financial statements and related notes appearing in this annual report on Form 10-K. we focus on those communication requirements that are pan-regional in scope. voice and collaboration services and deliver service to approximately 40 percent of the companies in the Fortune 500.” to the accompanying consolidated financial statements for further information regarding our operating segments. mobile operators and Internet service providers around the world. we strive to provide unsurpassed customer service. We will continue to focus strongly on customer loyalty by driving enhancements to ensure superior customer service. we intend to enhance our service offerings and pursue the extension of our network in order to offer our growing suite of value-added service offerings to additional markets. The forward-looking information is based on various factors and was derived from numerous assumptions.

(ii) lower real estate costs. “Risk Factors”. Cost savings initiatives put a strain on our existing employees and make it more challenging to foster an engaged and enthusiastic workforce. increased $120 million. including the risks described in Item 1A. Our consolidated Free Cash Flow. If our cash flows do not improve. which is a critical component of our value proposition. Revenue in our enterprise. If the technology and product development choices we make prove to be incorrect. • • • 2010 Highlights During 2010. In addition. we may be unable to improve our cash flows. in part. we will be unable to compete effectively because we will not be able to meet the expectations of our customers. This increase was primarily due to growth in the existing customer base and the acquisition of new customers in specific enterprise and carrier target markets. while revenue in this channel in 2009 included $13 million for one customer’s buyout of certain long term obligations. was $400 million in 2010 compared to $342 million in 2009. which is a relevant indicator of our ability to generate cash to pay debt and a key measure we use to evaluate our liquidity. there can be no assurance that such growth will continue. (iii) lower real estate restructuring reserves. Our ability to generate positive cash flow over the long term is predicated on significant revenue growth in our target enterprise. and (v) $11 million of favorable foreign exchange impacts. foreign currency movements favorably impacted revenue growth in 2010 by $21 million. could suffer if employee engagement were to deteriorate. Annual incentive compensation was primarily paid in cash in 2010 versus payment in stock in 2009.159 million in 2009. In particular: • • It becomes more difficult to continue to improve our cost structure in the short term as the opportunities for further savings decreases due to the success of past savings initiatives. and (ii) higher accrued incentive compensation. decreased $66 million to $16 million in 2010 compared to $82 million in 2009. Consolidated OIBDA. ineffective or unacceptably costly. Our consolidated OIBDA increased primarily as a result of: (i) revenue growth and improved sales mix. together with associated economies of scale. The success of investments we make in products and services depends. The increase in our consolidated OIBDA was partially offset by: (i) higher salaries and other payroll costs. or 6%. carrier data and indirect sales channel in 2010 included $6 million from the completion of a customer contract and $7 million for equipment sales related to a new managed services contract.” below.279 million in 2010 compared to $2. Customer service.Successful execution of these objectives is subject to numerous risks and uncertainties. which is a key measure we use to evaluate our profitability and operating performance. The decrease was principally driven by high cash payments for interest and incentive compensation in 2010. as well as a larger benefit from improved collections in 2009. which is the primary focus of our business strategy. revenue in 2010 included $4 million as a result of the inclusion of Genesis Networks in our results since October 29. If the operating and capital expenses required to support our growth turn out to be greater than anticipated or if anticipated growth is not achieved. In addition. See “Liquidity and Capital Resources. on our ability to adapt to rapidly changing developments in the telecommunications industry. 2010. carrier data and indirect sales channel. to $2. Persistent industry price decreases are a significant impediment to revenue growth and could be greater than anticipated. 49 . revenue from our enterprise. See “Use of Certain non-GAAP Measures” below in this Item 7 for further information about OIBDA and Free Cash Flow. we would need to arrange additional financing which may not be available on acceptable terms or at all. Although we have experienced consistent growth in this sales channel since we first announced the shift in our business focus in late 2004. (iv) a decrease in bad debt expenses. carrier data and indirect sales channel (sometimes referred to as “invest and grow” sales channels in our press releases pertaining to financial results).

OIBDA should be considered in addition to. We paid a purchase price for Genesis Networks of approximately $8 million and repaid a portion of the debt and other liabilities assumed as part of the acquisition for total consideration including direct costs of $27 million. as calculated in accordance with accounting principles generally accepted in the United States of America (“U.S. It excludes the effect of items associated with our capitalization and tax structures. There are material limitations to using non-U. In addition. The Genesis Networks network connects 70 cities on five continents and links important international media centers through 225 on-net points. and to make resource allocation decisions. producers and aggregators of specialized programming. and preferred stock dividends.” to the accompanying consolidated financial statements for a reconciliation of OIBDA to income (loss) applicable to common shareholders. interest income. Additionally. OIBDA does not give effect to cash used for debt service requirements and thus does not reflect available funds for reinvestment. interest expense. other non-operating income or expense items.S. OIBDA differs from operating income (loss). and (ii) pay the estimated initial purchaser discounts. as opposed to the cash impacts of capital expenditures made in recent periods.During 2010. especially in a capital-intensive industry such as telecommunications. GAAP. We used the proceeds from the issuance of the 9% Senior Notes to: (i) redeem the 5% convertible senior notes due 2011 (the “5% Convertible Notes”) at an optional redemption price equal to 101% of their principal amount. make comparisons between periods. and of other items not associated with our everyday operations. We expect that Genesis Networks will require modest funding in respect of this deficit and its ongoing operating requirements. we acquired 100% of the capital stock of Genesis Networks Inc. GAAP”) and reflected in our consolidated financial statements. On October 29. interest expense. See below in this Item 7 under “Liquidity and Capital Resources” for further information related to the notes offering and associated use of proceeds. Our calculation of OIBDA may differ from similarly titled measures used by other companies. and not as a substitute for. See Note 21. OIBDA is an important part of our internal reporting and planning processes and a key measure to evaluate profitability and operating performance. OIBDA does not include certain significant items such as depreciation and amortization. 2010. Use of Certain non-GAAP Measures OIBDA The Company’s chief operating decision makers (“CODMs”) measure and evaluate our reportable segments based on operating income (loss) before depreciation and amortization (“OIBDA”). GAAP financial measures. income taxes and preferred stock dividends. 50 . we issued $150 million aggregate principal amount of 9% senior notes due November 15. such as interest income.S. The acquisition of Genesis Networks will enable us to provide value-added solutions to address specialized video transmission requirements across multiple industries. other measures of financial performance reported in accordance with U. “Segment Reporting. “Debt” to the accompanying consolidated financial statements for a description of the 9% Senior Notes. We believe that OIBDA is a relevant indicator of operating performance. distributions or other discretionary uses. See also Note 10. income taxes. professional fees and other transaction fees and expenses in connection with the offering. The results of Genesis Networks’ operations are included in our consolidated financial statements starting on the acquisition date. 2019 (the “9% Senior Notes”). in that it excludes depreciation and amortization. a privately held company providing high performance rich media and video-based applications. Such excluded expenses primarily reflect the non-cash impacts of historical capital investments. and may not be comparable to those other measures. serving many of the world’s major broadcasters. OIBDA provides us with an indication of the underlying performance of our everyday business operations. (“Genesis Networks”).

and not as a substitute for. .Free Cash Flow We define Free Cash Flow as net cash provided by (used in) operating activities less purchases of property and equipment as disclosed in the consolidated statements of cash flows. . estimates and assumptions that affect the reported amounts of assets.S. Although these estimates are based on our knowledge of current events. 51 . . . . . References to U. . . Free Cash Flow should be considered in addition to. . current circumstances. expenses. GAAP. net change in cash and cash equivalents in the condensed consolidated statements of cash flows reported in accordance with U.S. There are material limitations to using non-U. who continually evaluate the judgments. GAAP requires management to make judgments. . . . . . and preferred stock dividends and the effect of exchange rate changes on cash and cash equivalents balances. . . estimates and assumptions and may employ outside experts to assist in the evaluations. . and (iii) exchange rate changes on cash and cash equivalents balances. . . Purchases of property and equipment . . . . . proceeds from financing activities. . and the related disclosures at the date of the financial statements and during the reporting period. . . and we therefore generate higher Free Cash Flow than comparable businesses that do pay income taxes. (the “Codification” or “ASC”). GAAP financial measure. . . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Free cash flow . . liabilities. Free Cash Flow differs from the net change in cash and cash equivalents in the consolidated statements of cash flows in that it excludes the cash impact of: (i) all investing activities (other than capital expenditures. . GAAP financial measures. . . GAAP in this Annual Report are to the Financial Accounting Standards Board (“FASB”) Accounting Standards CodificationTM. we do not currently pay a significant amount of income taxes due to net operating losses. .S. . . The following table provides a reconciliation of Free Cash Flow for 2010 and 2009 which is considered a non-U. . . . . which have been prepared in accordance with U. . . . GAAP. repayments of capital lease obligations and other debt. our actual amounts and results could differ from those estimates. . . and may not be comparable to those other measures. . . . . . Our calculation of Free Cash Flow may differ from similarly titled measures used by other companies.S. .S. which are a fundamental and recurring part of our business). Critical Accounting Policies and Estimates $ 16 167 $183 $ 82 174 $256 $(66) (7) $(73) (80%) (4%) (29%) Our discussion and analysis of our financial condition and results of operations are based upon the accompanying consolidated financial statements. . and the experience and judgment of our management. . revenues. Net cash provided by operating activities . . . . Additionally. . . . The estimates made are based on historical factors. . to net cash provided by operating activities: Year Ended December 31. We believe that the investment community uses similar performance measures to compare performance of competitors in our industry.S. . . . The preparation of financial statements in conformity with U. Free Cash Flow is subject to variability quarter over quarter as a result of the timing of payments related to accounts receivable and accounts payable and capital expenditures. Free Cash Flow also does not include certain significant cash items such as purchases and sales out of the ordinary course of business. . . . We believe that Free Cash Flow is useful to our investors as it provides an indication of the underlying cash position of our everyday business operations and the ability to pay debt. . . . . Moreover. We use Free Cash Flow as a relevant indicator of our ability to generate cash to pay debt. . Free Cash Flow also is an important part of our internal reporting and a key measure used by us to evaluate liquidity from period to period. . . . . . (ii) all financing activities. . . .

We analyze historical credit activity and changes in customer demands related to current billing and service interruptions when evaluating our credit reserve requirements. We reserve known billing errors and service interruptions as incurred. Appropriate adjustments are recorded to the period in which these changes become known. subjective or complex judgments as a result of the need to make estimates about the effect of matters that are inherently uncertain. We have historically experienced significant changes month to month in reserve level requirements. A general reserve requirement is performed on accounts not subject to specific review utilizing the factors previously mentioned. The recognition of cost of access expense during any reported period involves the use of significant management estimates and requires reliance on non-financial systems given that bills from access vendors are generally received significantly in arrears of service being provided. service interruptions and customer disputes which are recorded as a reduction in revenue. Upon final receipt of invoices. Receivable Reserves Sales Credit Reserves During each reporting period we must make estimates for potential future sales credits to be issued in respect of current revenues. the competitive environment in the telecommunications sector and the volatility of the financial strength of particular customer segments including resellers and competitive local exchanges. the length of the customer’s relationship with us. including the length of time the receivables are past due. The determination of both the specific and general allowance for doubtful accounts reserve requirements involves significant estimation and judgment. multiplied by the estimated rates for those minutes for that month. changes in the customer’s creditworthiness.” as they are both most important to the financial statement presentation and require management’s most difficult. Switched voice traffic costs are accrued based on the minutes recorded by our switches. the estimated costs are adjusted to reflect actual expenses incurred.” to the accompanying consolidated financial statements. negotiations. see Note 2. “Basis of Presentation and Significant Accounting Policies. Our policy is to record access expense as services are provided by vendors. We also estimate a general sales credit reserve related to unknown billing errors and disputes based on such historical credit activity.Certain of our accounting policies are deemed “critical. We analyze our reserve requirements using several factors. Changes in the financial viability of significant customers and worsening of economic conditions may require changes to our estimate of the recoverability of the receivables. We review customer disputes and reserve against those we believe to be valid claims. the collectability of receivables and creditworthiness of customers may become more difficult and unpredictable. For a full description of our significant accounting policies. Allowance for Doubtful Accounts During each reporting period we must make estimates for potential losses resulting from the inability of our customers to make required payments. Leased line access costs are estimated based on the number of circuits and the average circuit cost. The determination of the general sales credit and customer dispute credit reserve requirements involves significant estimation and judgment. the customer’s payment history. A specific reserve requirement review is performed on customer accounts with larger balances. the current economic climate. according to our leased line inventory system. 52 . In some cases receivables previously written off are recovered through litigation. settlements and judgments and are recognized as a reduction in bad debt expense in the period realized. Due to the current economic climate. related to billing errors. and current industry trends. adjusted for contracted rate changes. Cost of Access Expense and Accruals Our cost of access primarily comprises charges for leased lines for dedicated facilities and usage-based voice charges paid to local exchange carriers and interexchange carriers to originate and/or terminate switched voice traffic.

are impacted by events and transactions arising in the normal course of business as well as in connection with special and non-recurring items.Disputes We and contracted third parties perform monthly bill verification procedures to identify errors in vendors’ billing processes. comparing billed rates with rates used by the cost of access expense estimation systems during the cost of access monthly close process. The estimation involves. including allocated goodwill. Calculating the future net cash flows expected to be generated by assets to determine if impairment exists and to calculate the impairment involves significant assumptions. discount rates. estimation and judgment. using a discounted cash flow analysis. The estimation and judgment involves. Impairment of Goodwill and Other Long-Lived Assets We assess the possible impairment of long-lived assets composed of property and equipment and other assets held for a period longer than one year whenever events or changes in circumstances indicate that the carrying amount of the asset(s) may be impaired. and reviewing the types of charges being assessed. industry trends. estimated long term revenue. Our current and deferred income taxes. revenue growth. industry trends including pricing. These estimates and assumptions are revised as new events occur. but is not limited to. the likelihood of deferred tax assets being recovered and the outcome of contingent tax risks. including pricing. but is not limited to. We record a charge to the cost of access expense and a corresponding increase to the access accrual based on the last eighteen months of historical loss rates for the particular type of dispute. As a result of a history of operating losses and negative cash flows. and expected periods the assets will be utilized. to their carrying values. 2010. evaluating the trends of invoiced amounts by vendors. Recoverability of long-lived assets to be held and used is measured by comparing the carrying amount of an asset to the undiscounted net future cash flows expected to be generated by the asset. The bill verification procedures include the examination of bills. The results of the reviews indicate that no impairment exists as the fair value of all reporting units exceeded their carrying values. during 2010 management performed a recoverability test of our long-lived assets as of December 31. If these projected future cash flows are less than the carrying amount. amounts of permanent and temporary differences. including allocated goodwill. 2010. and associated valuation allowances. we must make certain estimates and assumptions to compute the provision for income taxes including allocations of certain transactions to different tax jurisdictions. estimation and judgment. Calculating future net cash flows expected to be generated by the reporting units involves significant assumptions. The results of the test indicate that no impairment of our long-lived assets existed as of December 31. capital expenditures. If we believe that we have been billed inaccurately. impairment would be recognized. and expected periods the assets will be utilized. If we ultimately reach an agreement with an access vendor to settle a disputed amount which is different than the corresponding accrual. estimating long term revenues. more experience is acquired and additional information is obtained. The impairment reviews compared the fair value of the reporting units. operating expenses. Assessment of the appropriate amount and classification of income taxes is dependent on several factors. capital expenditures. The impairment loss is measured by the amount by which the carrying amounts of the assets exceed their fair value. Goodwill and intangibles with indefinite lives are reviewed at least annually (beginning on the first anniversary of the acquisition date) for impairment whether or not events have occurred that may indicate impairment. we recognize the difference in the period in which the settlement is finalized as an adjustment to cost of access expense. Taxes At each period end. operating expenses. The impact of these revisions is recorded in income tax expense or benefit in the period in which they become known. We performed annual impairment reviews of the goodwill acquired as part of the Fibernet and Impsat acquisitions in accordance with ASC Topic 350. resulting in a write-down of the assets with a corresponding charge to earnings. we will dispute the charge with the vendor and begin resolution procedures. revenue growth. 53 .

see Note 16. Such estimates are inherently judgmental and changes in such estimates. sufficient evidence exists to require a valuation allowance on the vast majority of our net deferred tax assets. Future utilization of the remaining net deferred tax asset would require the ability to forecast future earnings. is composed of continuing building lease obligations and broker commissions for the restructured sites (aggregating $73 million as of December 31. Based on past performance resulting in net loss positions. including. A significant amount of judgment is involved in determining the amount and timing of these projected subleases. 54 . Deferred tax liabilities are first applied to the deferred tax assets reducing the need for a valuation allowance. “Restructuring. respectively. 2010). For further information related to our restructuring activities. portions of the award vest at different dates during the vesting period). Actual realization of deferred tax assets and liabilities may materially differ from these estimates as a result of changes in tax laws as well as unanticipated future transactions impacting related income tax balances.including estimates of the timing and realization of deferred income tax on income and deductions. Restructuring We have engaged in restructuring activities.e. future severance costs and other employee separation costs. but not limited to. see “Restructuring Activities” in this Item 7 and Note 3. We recognize stock compensation expense based on the number of awards expected to vest. especially as they relate to contractual lease commitments and related anticipated third-party sub-lease payments. 2010. We recognize the related compensation cost of such awards on a straight-line basis. sublease income or disposal costs. in the fourth quarters of 2010 and 2009 we reduced the valuation allowance against their deferred tax assets by $34 million and $20 million. The undiscounted “2003 and Prior Restructuring Plans” reserve. could have a material effect on the restructuring liabilities and consolidated results of operations. to the accompanying consolidated financial statements. Consequently.” to the accompanying consolidated financial statements. offset by anticipated receipts from existing and future third-party subleases. anticipated third party receipts were $64 million. As of December 31. For a description of our stock-based compensation programs. “Stock-Based Compensation”. provided that the amount amortized at any given date may be no less than the portion of the award vested as of such date. length of time on market for abandoned rented facilities. We estimate the fair value of each stock-based compensation award at the date of grant using the current market price for restricted stock units. The assessment of a valuation allowance on deferred tax assets is based on the weight of available evidence that some portion or the entire deferred tax asset will not be realized. which represents estimated future cash flows. except for a portion of those at certain of our operating subsidiaries. Certain stock-based awards have graded vesting (i. The fair value of the awards is determined using a single expected life for the entire award (the average expected life for the awards that vest on different dates). Those operating subsidiaries have now demonstrated an earnings history which is expected to continue into the foreseeable future. which require us to make significant judgments and estimates in determining restructuring charges. We believe this provides sufficient positive evidence that a portion of their deferred tax assets will be realized. and contractual termination costs. We continue to review our anticipated costs and third party sublease payments on a quarterly basis and record adjustments for changes in these estimates in the period such changes become known. representing $48 million from subleases already entered into and $16 million from subleases projected to be entered into in the future. using the Black-Scholes option pricing model for stock options and the Monte-Carlo valuation model for performance share opportunities with market conditions. Stock-Based Compensation We account for stock-based compensation in accordance with ASC Topic 718 which requires all sharebased awards granted to employees to be recognized as compensation expense over the service period (generally the vesting period) based on their fair values.

” to the accompanying consolidated financial statements. . . . . . Selling. . . . . . . . . . . . . . . . see Note 19. . . . Real estate. . it is possible that upon the further development or resolution of a contingent matter. . . . Loss before benefit (provision) for income taxes . . . .Assessment of Loss Contingencies We have legal. . . . . . . . . . . . . . . . . . . . . Other income (expense). . . . . . . .609 $ 2. . . . . . . . Further. . . . . . . . . . . Third party maintenance . . Loss applicable to common shareholders . . . . . . . 2010 compared to the Year Ended December 31. . . . . . .159) (408) (104) (107) (1. . . . . . . . . . . . . . . . . . . . . . . . . . . .778) 831 (431) (337) 63 2 (191) (51) (177) 5 (172) (4) $ (176) (1. . . . Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . A significant amount of judgment is involved in determining whether a loss is probable and reasonably estimable due to the uncertainty involved in predicting the likelihood of future events and estimating the financial impact of such events. Benefit (provision) for income taxes . . . network and operations . . . . . . . . . . . . . . . . . . . . . . . . . . . Results of Operations for the Year Ended December 31. . . . . . . . . . . . . . . . Accordingly. . Gross margin . . . . . Net loss . . . . . . . . . . . . . . . . . . . . Other income (expense): Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . Total cost of revenue .159) (406) (103) (98) (1. . 2009 Consolidated Results Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . Contingencies and Other. . where it is probable that a liability has been incurred and there is a range in the expected loss and no amount in the range is more likely than any other amount. . . . . net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .536 $ 73 3% (1. . . Operating income . . . . . . . . . . . . a significant charge could be recorded in a future period related to an existing contingent matter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of revenue (excluding depreciation and amortization. . . . . . . . . . . . . . . . . . Interest expense . For additional information. . “Commitments. . . . . . . . . . . . Cost of equipment and other sales . 55 . . . . shown separately below): Cost of access . . . . . . . . . . . . . with respect to loss contingencies. . . . . . . . tax and other contingencies that could result in significant losses upon the ultimate resolution of such contingencies. . . . . . . . . . . . . . . . . we accrue at the low end of the range. . . . . . . . . . . . . . .766) 770 (428) (340) 2 7 (160) 11 (140) (1) (141) (4) $ (145) — 2 1 9 NM NM 1% 9% 3 (3) 1% (1%) (5) 31 (62) 6 — (71%) 19% NM NM NM NM—Zero balances and comparisons from positive to negative numbers are not meaningful. . . . . . . . . . . . . . . We have provided for losses in situations where we have concluded that it is probable that a loss has been or will be incurred and the amount of the loss is reasonably estimable. . $ 2. . . . . general and administrative . . . . . . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Revenue . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . $2. . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Enterprise. Cost of Revenue. . . . . . . . . . . . . . . . carrier data and indirect channel sales driven by growth in the existing customer base and the acquisition of new customers in specific enterprise and carrier target markets. . . . carrier data and indirect sales channel. .159 374 3 $2. transport and capacity services. . Revenue attrition in the fourth quarter of 2010 was in line with our recent historical average. . . voice. . The enterprise. . . . . . . . . sales agents and system integrators. . The gross values of these monthly recurring orders are estimated based on new business acquired. . . Pricing for our VPN and managed services products continues to decline at a relatively modest rate. New orders include value-added. (ii) $21 million of favorable foreign exchange impacts. . . . . . . to carrier customers. . Our sales order levels are a key indicator of continuing strength in customer demand for our services. and (iii) $4 million as a result of the inclusion of Genesis Networks in our results since October 29. and they exclude the effects of the replacement of existing services with new services. . Other key metrics used by management are revenue attrition and pricing trends for products in our enterprise. . and charges for leased lines for dedicated facilities and local loop (“last mile”) charges from both 56 . . . . . . . . 2010. . . to enterprises with multinational requirements which offer us significant growth opportunity. See “Segment Results” in this Item 7 for further discussion of results by segment. . including IP. . . Our consolidated revenue increased in 2010 compared with 2009 primarily due to: (i) additional enterprise. . . . . . . carrier data and indirect sales channel and (ii) carrier voice. . and (iii) the provision of voice.536 $120 (46) (1) $ 73 6% (12%) (33%) 3% Our consolidated revenue is separated into two businesses based on our target markets and sales structure: (i) enterprise. . . while revenue in 2009 included $13 million for one customer’s buyout of certain long term obligations. . carrier data and indirect sales channel business consists of: (i) the provision of IP. . . . Order volumes were higher in each quarter of 2010 than they were during any quarter of 2009. . . Revenue attrition generally results from market dynamics and not customer dissatisfaction. . . . . credits and attrition (defined as customer disconnects. The carrier voice business consists of the provision of predominantly United States domestic and international long distance voice services to carrier customers. . .279 328 2 $2. . . . . . . price reductions on contract renegotiations and customer usage declines). . . 2010 and September 30. . including usage-based voice charges paid to local exchange carriers and interexchange carriers to originate and/or terminate switched voice traffic. . . . while pricing for specific data products such as highspeed transit and capacity services (specifically internet access arrangements used by content delivery and broadband service providers) is declining at a greater rate.Discussion of significant variances: Revenue Year Ended December 31. Other . .4 million in both the three months ended December 31. . 2010. . Sales orders are used by management as a leading business indicator offering insight into near term revenue trends. . . Revenue in 2010 included $6 million for the completion of a customer contract and $7 million for equipment sales related to a new managed services contract. . . . . .609 $2. . Consolidated revenues . . . . data center and collaboration services to all customers other than carriers and consumers. . . . . . . . . . . . . carrier data and indirect sales channel . . . data and managed services to or through business relationships with other carriers. . Cost of revenue primarily includes the following: (i) cost of access. . . Carrier voice . . . The average monthly estimated gross value for sales orders was $4. integrated solutions. . . . (ii) the provision of data products. This increase was partially offset by a decline in our carrier voice business. . .

(iv) non-income taxes. . (iii) a $4 million reduction in real estate restructuring reserves. . insurance. Consolidated cost of access . . Selling. (ii) a $6 million favorable regulatory ruling related to a reduction in access charges in the U. . partially offset by: (i) a $5 million retroactive property tax assessment ($3 million and $2 million.K. . . (ii) a $4 million decrease in bad debt expense. . . Cost of equipment and other sales increased in 2010 compared with 2009 primarily due to higher equipment sales and professional services costs. . Carrier voice . . telecommunications costs. . . . (iii) third party maintenance costs incurred in connection with maintaining the network. .159 $ 36 (35) (1) $— 4% (11%) (100%) NM Cost of access was flat in 2010 compared with 2009 as the impacts of lower carrier voice sales revenue and cost reduction initiatives were offset by: (i) higher enterprise. and (iv) a $3 million reduction of non-income tax reserves. . . . SG&A consist of: (i) employee-related costs such as salaries and benefits. . Real Estate. . network and operations increased in 2010 compared with 2009 primarily due to: (i) $3 million of unfavorable foreign exchange impacts. (ii) real estate expenses for all non-restructured administrative sites. . These factors were partially offset by a $4 million decrease in other expenses principally driven by a $4 million insurance recovery in the U. 57 . . . . . . . including property taxes on owned real estate and taxes such as gross receipts taxes. . . . . carrier data and indirect channel sales revenue. . . which includes third party professional services. carrier data and indirect sales channel . . $ 861 298 — $1. incentive compensation and stock-related expenses for employees directly attributable to the operation of our network. . . . . franchise taxes and capital taxes. (v) restructuring costs.K. . . 2010 and (v) $3 million of unfavorable foreign exchange impacts. General and Administrative Expenses (“SG&A”). and (iv) cost of equipment sales and other. . . . . . . . . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Enterprise. . . and (vi) regulatory costs. . . . . . and (iii) $3 million of unfavorable foreign exchange impacts. . . . . . . . . . (b) real estate expenses for all non-restructured technical sites. . . (iv) $3 million of incremental costs as a result of the inclusion of Genesis Networks in our results since October 29. . . . . third party sales commissions and other expenses. recorded in 2010. Real estate. . as well as unpaid leave savings in 2009. . . (ii) a $8 million increase in travel expenses. . . . . . . maintenance and utilities. respectively. (iii) $3 million of costs associated with a 2010 subsea cable repair. . . . . and (ii) a $6 million property tax refund in the U. . . recorded in 2009. . and (c) other non-employee related costs incurred to operate our network.159 $ 825 333 1 $1. . . . . . . . Network and Operations. . . . . . . such as license and permit fees and professional fees. Other . network and operations charges which include (a) employeerelated costs such as salaries and benefits. . . . . . . . . . (iii) bad debt expense. Cost of equipment and other sales. in our GCUK and ROW Segments) recorded in 2009. . . SG&A increased in 2010 compared with 2009 primarily due to: (i) $10 million of higher salaries and benefits driven by salary increases and litigation charges in 2010. . . . (ii) $2 million of higher employee incentive compensation costs primarily due to accruing annual employee incentive compensation at a higher rate in 2010. . hardware and equipment sold to our customers.domestic and international carriers. . . . . (ii) real estate. . and (iii) $1 million of higher real estate costs driven by higher facilities rent. professional fees and license and maintenance fees for internal software and hardware. These factors were partially offset by: (i) $5 million of lower real estate costs driven by lower facilities rent.K. . . Cost of Access Year Ended December 31. incentive compensation and stock-related expenses for employees not directly attributable to the operation of our network. . . software. . . . . maintenance and utilities.

Interest income decreased in 2010 compared with 2009 primarily as a result of the refund of a vendor deposit plus accrued interest recorded in 2009. Interest income. Depreciation and Amortization. and (ii) higher interest related to our pound sterling denominated GCUK Notes due to unfavorable foreign exchange impacts. capital lease obligations. 58 . We recorded a benefit for income taxes in 2010 compared with a provision for income taxes in 2009 primarily as a result of an increase in deferred tax benefits in 2010. including assets recorded under capital leases. Depreciation and amortization decreased in 2010 compared with 2009 primarily due to the expiration of the useful life of certain assets acquired as part of the Impsat acquisition. marketable securities and other assets and other non-operating items. These factors were partially offset by a $29 million loss in 2009 on the early extinguishment of the GC Impsat Notes and the loan under the Term Loan Agreement. a substantial portion of the proceeds of which was used to retire other debt. 2009. Depreciation and amortization consists of depreciation of property and equipment.We selectively invested in sales resources where we saw opportunity for business expansion. gains and losses on the sale of assets including property and equipment. Other Income (Expense). respectively. During the fourth quarters of 2010 and 2009. The foreign exchange losses in 2010 included a $27 million foreign exchange loss as a result of the devaluation of the Venezuelan bolivar in the first quarter of 2010 (see “Currency Risk” below). as well as by unfavorable foreign exchange impacts. we reduced the valuation allowance against our deferred tax assets by $34 million and $20 million. net consists of foreign currency impacts on transactions. certain tax liabilities. Interest expense includes interest related to indebtedness for money borrowed. Other expense. Benefit (Provision) for Income Taxes. Other income (expense). Net. Interest expense. and (ii) a $6 million loss in 2010 on the early extinguishment of the 5% Convertible Notes. amortization of deferred finance costs and interest on late payments to vendors. amortization of cost of access installation costs and amortization of identifiable intangibles. The increase in interest expense in 2010 compared with 2009 was primarily a result of: (i) an increase in the amount of debt outstanding primarily as a result of the issuance of the 12% Senior Secured Notes on September 22. partially offset by an increased asset base as a result of fixed asset additions. net increased in 2010 compared with 2009 primarily as a result of: (i) foreign exchange losses in 2010 as compared to foreign exchange gains in 2009. including assets recorded under capital leases. due to the improving profitability of certain of our Latin American subsidiaries.

. . . . . . . network and operations . . . . . . . . . $2. . . . Other income (expense): Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loss before pre-confirmation contingencies and provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (ii) a decline in our carrier voice business. . . . . . . . . . . . Discussion of significant variances: Revenue Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest expense . . . . . . . . . . . . . Cost of revenue (excluding depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Third party maintenance . . . . . . . . . . Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .159) (406) (103) (98) (1. . . . . . . . . . . . . Selling. . . . . . . . . . . . . . Revenue in 2009 included $13 million for one customer’s buyout of certain long term obligations under an existing contract. . . . . . . . . . Net gain on pre-confirmation contingencies . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . . . . . .171 424 4 $2. net . . . . . . . . . . . . . . . Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gross margin . . . . . . Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and (iii) the completion of the Camelot network contract in the U. . . . . . . . . . . . . Loss applicable to common shareholders . . . .211) (423) (107) (94) (1. . . Preferred stock dividends . . . . . . . . . . . . . .K. . . .835) 764 (491) (326) (53) 10 (176) (26) (245) 10 (235) (49) (284) (4) $ (288) (52) (17) (4) 4 (4%) (4%) (4%) 4% (63) 14 (13%) 4% (3) (16) 37 (30%) (9%) NM (10) (48) — (100%) (98%) NM NM—Zero balances and comparisons from positive to negative numbers are not meaningful. . . . . . . . . Carrier voice . . . . . . . . . . . . . . . . . . . . . . .599 $(63) (2%) (1. . . . . . . . . . . . 59 . . . . . . . . . . 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Enterprise. . . . . . . . . . . . . . .536 $2. . . . . . . . . . . . . . . Cost of equipment and other sales . . . $ 2. . . . . . . . . . . . . . . . .159 374 3 $2. . 2008 Consolidated Results Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Real estate. . . . . . . . . .599 $(12) (50) (1) $(63) (1%) (12%) (25%) (2%) Our consolidated revenue decreased in 2009 compared with 2008 primarily due to: (i) unfavorable foreign exchange impacts. . . . . Other income (expense). . . Net loss . . . . . . . . . . . . . . . . . . . . Loss before provision for income taxes . . . . . . . . shown separately below): Cost of access . . . . . . . . . . . . 2009 compared to the Year Ended December 31. . . . . . . . . . .766) 770 (428) (340) 2 7 (160) 11 (140) — (140) (1) (141) (4) $ (145) (1. 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Revenue . . . . . . . . . . . . . . . general and administrative . . . . . . Total cost of revenue . . . . .536 $ 2. . . . . . . . . . .Results of Operations for the Year Ended December 31. . . . . . . . . carrier data and indirect sales channel . . . Consolidated revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . .8 million in the three months ended December 31. . . Cost of Access Year Ended December 31. we experienced declines in our cost of access as a result of the completion of the Camelot network contract.S. . .4 million in the three months ended September 30. . . $ 825 333 1 $1. . . . . partially offset by an increase in non-recurring network maintenance. .K. . . . respectively. . . . real estate taxes and utilities. . primarily the British Pound Sterling. as we continued to manage the business to achieve satisfactory margin targets. . . with favorable currency impacts across all of our segments. . carrier data and indirect sales channel . Despite the reductions noted above. . and (ii) $7 million of lower employee incentive compensation costs primarily due to accruing annual employee incentive compensation at a lower rate in 2009. . Carrier voice . 2009 compared with $3. . . . . . . . . our cost of access decreased due to lower carrier voice sales revenue and our cost reduction initiatives to optimize access network costs and effectively lower unit prices. The favorable regulatory ruling was appealed by the access provider. . our revenue reflected continuing demand for our IP VPN. . . . . . Cost of equipment and other sales increased in 2009 compared with 2008 primarily due to higher equipment sales and professional services costs. network and operations decreased in 2009 compared with 2008 primarily due to: (i) $30 million of favorable foreign exchange impacts. we received a credit note from the access provider. The decrease in our consolidated cost of access was partially driven by favorable foreign exchange impacts in 2009 compared with 2008 which favorably impacted our consolidated cost of access expense by $40 million. . unfavorably impacted revenue during 2009 compared with 2008 by approximately $138 million. . See “Segment Results” in this Item 7 for further discussion of results by segment. 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Enterprise. Third party maintenance decreased in 2009 compared with 2008 primarily due to favorable foreign exchange impacts of $6 million. based employee retirement plan. . as well as higher rent. . . .211 $(12) (40) — $(52) (1%) (11%) NM (4%) Cost of access decreased in 2009 compared with 2008. . Cost of Revenue. . . As a result of the favorable regulatory ruling. while pricing for specific data products such as high-speed transit and capacity services (specifically internet access arrangements used by content delivery and broadband service providers) continued to decline at a greater rate. . partially offset by unpaid leave and suspension of the company matching contribution for our U. . The completion of the Camelot network contract negatively impacted revenue by approximately $46 million in 2009 compared with 2008. . while revenue attrition in the fourth quarter of 2009 was at our recent historical average (excluding the impact of the completion of the Camelot network contract). . . . . . . . . 2009. . . . . Dollar against foreign currencies. . enterprise voice and data center services.159 $ 837 373 1 $1. . . The pricing for our VPN and managed services products continued to decline at a relatively modest rate over the last few quarters of 2009. . Network and Operations. . . . . We are contesting the retroactive property tax assessment. . . . . . . . . Lastly. . . . . . . . These decreases were partially offset in 2009 compared to 2008 by: (i) a $17 million increase in real estate costs partially driven by a $5 million retroactive property tax assessment ($3 million and $2 million. . . Consolidated cost of access . . .K. . the Euro and the Brazilian Real. . partially offset by $16 million of favorable foreign currency movements. . included in our GCUK and ROW Segments) for the period from December 2006 to June 2009 in the U. . Third Party Maintenance. . . . . . . . Also. . . . Other . . . . We do not expect any significant adjustments as a result of the appeal. .S. Real Estate. . . Carrier voice revenue decreased in 2009 compared with 2008. . . . . . . . . and (ii) $10 million of higher employee-related costs due to higher average headcount in 2009 and severance charges. Real estate. . . . Cost of access in 2009 included a $6 million reduction due to a favorable regulatory ruling related to access charges in the U. Cost of Equipment and Other Sales. 60 . . . The average monthly estimated gross value for sales orders was $3.The appreciation of the U.

and (iv) lower interest related to other miscellaneous debt and late payments to vendors. the benefit for the reversal of valuation allowances on pre-emergence and pre-acquisition deferred tax assets were recorded as additional paid in capital and a reduction of goodwill. 2009 of new accounting and reporting standards for business combinations. (iii) lower interest on our GC Impsat Notes due to their early extinguishment in the third quarter of 2009.K. New accounting principles and reporting requirements for business combinations nullified the guidance previously found in AICPA Practice Bulletin No. partially offset by favorable foreign exchange impacts. these benefits are now recorded as a reduction in the tax provision. “Accounting for Pre-confirmation Contingencies in Fresh Start Reporting. Depreciation and Amortization. (ii) the GC Impsat Segment. 11. Net. adjustments in income tax contingencies are recognized in the provision for income taxes and non-income tax contingencies in operating income or loss. The decrease in interest expense in 2009 compared with 2008 was primarily the result of: (i) lower interest related to our pound sterling denominated GCUK Notes due to favorable foreign exchange impacts.Selling. advertising and other costs as a result of cost savings initiatives. Net Gain on Pre-confirmation Contingencies. These factors were partially offset by recording interest on the 12% Senior Secured Notes which were issued in the third quarter of 2009. 2009. codified as ASC Topic 805. respectively. including assets recorded under capital leases. Subsequent to adoption on January 1. Subsequent to the adoption. unpaid leave and suspension of the company matching contribution for our U. which amended the accounting for the reversal of valuation allowances associated with pre-emergence and pre-acquisition deferred tax assets. partially offset by recording a $29 million loss in 2009 on the early extinguishment of the GC Impsat Notes and the Senior Secured Term Loans. Interest Expense.” which required adjustments of pre-confirmation contingencies to be separately disclosed in income or loss from continuing operations. net increased in 2009 compared with 2008 primarily as a result of recording foreign exchange gains in 2009 compared with foreign exchange losses recorded in the prior year. During 2008. The decrease in the provision for income taxes in 2009 compared with 2008 was primarily due to: (i) a $20 million partial release of a valuation allowance on deferred tax assets in the fourth quarter of 2009. major corporations and other communications companies in the U. and (iv) $5 million of lower employee incentive compensation costs primarily due to accruing annual employee incentive compensation at a lower rate in 2009.S. Other income. we recorded a $35 million non-cash tax provision related to these benefits. IP and voice services to government and other public sector organizations. The GC Impsat Segment is a 61 . based employee retirement plan. Segment Results Our CODMs assess performance and allocate resources based on three separate operating segments which we operate and manage as strategic business units: (i) the GCUK Segment. including data. The GCUK Segment is a provider of managed network communications services providing a wide range of telecommunications services. Depreciation and amortization increased in 2009 compared with 2008 primarily due to an increased asset base as a result of fixed asset additions. Provision for Income Taxes. and (iii) the ROW Segment. (iii) $7 million of lower employee-related costs primarily driven by lower sales commissions. Prior to the adoption. (ii) a decrease in other expenses of $15 million primarily due to lower travel. and (ii) the adoption on January 1. General and Administrative Expenses (“SG&A”). The decrease in interest income in 2009 compared with 2008 was the result of lower average cash balances and interest rates. Other Income (Expense). Interest Income. The decrease in SG&A in 2009 compared with 2008 was primarily due to: (i) $30 million of favorable foreign exchange impacts. (ii) lower interest on our Senior Secured Term Loan due to lower LIBOR rates and its early extinguishment in the third quarter of 2009.

This did not have a significant impact on our 2010 results and we estimate that our 2011 revenue will be adversely impacted by $10 million to $15 million. The Network Rail contract has two components. . The services provided by all our segments support a migration path to a fully converged IP environment. offset by lower government orders. . 2010 2009 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) Year Ended December 31. Third. The ROW Segment represents all our operations outside the GCUK and GC Impsat Segments and operates primarily in North America. . broadband services and managed services. IP and voice products. As a result of the investment in our sales force we have seen an increase in orders from our multinational enterprise customers. we extended a longstanding relationship with Her Majesty’s Revenue and Customs by entering into a five year agreement with a systems integrator to provide managed telephony and contact center solutions. . The U.K. Among our largest customer relationships. Total equipment sales increased by $3 million in 2010 as compared with 2009. with smaller operations in Europe.provider of telecommunication services including IP. we successfully renewed our contract with Network Rail. GCUK Segment Revenue Year Ended December 31. Latin America and a portion of the Asia/Pacific region and includes our subsea fiber optic network. carrier data and indirect sales channel . Overall revenue growth has been limited due to challenges in the government channel. . In addition. the completion of the Camelot network contract adversely affected 2009 revenue by $46 million as compared with 2008. . . . data center and information technology services to corporate and government clients in Latin America. including data. The decrease in our GCUK Segment revenue was moderated by continuing demand for broadband services and IP services. serving many of the world’s largest corporations and many other telecommunications carriers with a full range of managed telecommunication services. $472 $460 Carrier voice . . and we expect that competitive environment to continue. . expired in May 2010. . 2009 Compared to 2008 Revenue for our GCUK Segment decreased in 2009 compared with 2008 primarily as a result of foreign exchange impacts which unfavorably affected GCUK Segment revenue by $100 million. . . 2009 2008 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) GCUK Enterprise. partially offset by $3 million of unfavorable foreign exchange impacts. to whom we provide an international telecommunications network known as the FTN. . . voice. Second. Revenue in 2010 included $6 million for the completion of a customer contract and a $7 million equipment sale related to a new managed services contract. 5 10 $477 $470 $12 (5) $ 7 3% (50%) 1% $460 $588 10 11 $470 $599 $(128) (1) $(129) (22%) (9%) (22%) 2010 Compared to 2009 Revenue for our GCUK Segment increased in 2010 compared with 2009 primarily as a result of demand for our enterprise voice. 62 . . three contracts were completed in 2010. . First. . Our CODMs measure and evaluate our reportable segments based on OIBDA (see “Use of Certain non-GAAP Measures” above in this Item 7 for further information about OIBDA). one of which was extended for three years and one of which was extended for two years with an option for the customer to renew for one additional year. the Foreign Commonwealth Office (“FCO”). We have entered into transition arrangements in respect of the FCO’s migration to a network to be provided by a competitor as the replacement for the FTN. . Our GCUK Segment sales organization was increased in the first half of the year principally to focus on revenue growth and diversification through the acquisition of new multinational enterprise customers and additional government sectors not currently served. market continues to be highly competitive with significant pricing pressure. . .

. . Many government agencies and enterprises continued to refresh their more traditional technologies and took advantage of converged IP services. On October 9. . (ii) lower cost of access driven by a $6 million favorable regulatory ruling. . the telecommunications market in the U. . . .K. recorded in 2009. . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Year Ended December 31. . . 2007. One of GCUK’s principal customer relationships in the period to December 31. GCUK continued to see demand for its broadband services and IP services and as a result continued to win new business. . .K. . (ii) lower real estate costs driven by a $6 million U. . 9 9 $569 $504 $67 (2) — $65 63 14% $483 $466 (17%) 12 9 NM 9 7 13% $504 $482 $17 3 2 $22 4% 33% 29% 5% . 2008 was with Camelot. . carrier data and indirect sales channel . . 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) GCUK OIBDA . respectively.K. and (iii) lower other expenses driven by a $4 million insurance recovery. National Lottery. . However. . . These decreases in GCUK Segment OIBDA were moderated by: (i) increased demand for broadband services and IP services. . (ii) higher access charges driven by a $6 million favorable regulatory ruling related to a reduction in access charges in the U. . 2009 Compared to 2008 OIBDA in the GCUK Segment decreased in 2009 compared with 2008 primarily as a result of: (i) $25 million of unfavorable foreign exchange impacts. These factors were partially offset by: (i) higher salaries and other payroll costs resulting from increased sales resource headcount. . .K. . Camelot had deployed a landline-based ISDN network provided by us in relation to the operation of the U. . (iii) a $3 million retroactive property tax assessment as discussed above and (iv) higher cost of equipment and other professional services costs. Revenue from our relationship with Camelot was approximately $2 million and $48 million for 2009 and 2008. . . National Lottery. the current holder of the license to operate the U.Despite economic conditions. . Camelot completed the migration of the network. 2009 2008 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) GC Impsat Enterprise. . . 2010 2009 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) Year Ended December 31. . . . . and (iii) lower third party maintenance resulting from the re-negotiation of certain contracts. and (iii) higher cost of equipment and other sales due to higher equipment and professional services sales. . . . . GC Impsat Segment Revenue Year Ended December 31. Camelot announced its intention to replace its existing landline-based ISDN network with a broadband satellite communications network to be supplied by another service provider. .K. property tax refund recorded in 2010 and a $3 million retroactive property tax assessment recorded in 2009. $100 2010 Compared to 2009 $93 $7 8% $93 $134 $(41) (31%) OIBDA in the GCUK Segment increased in 2010 compared with 2009 primarily as a result of: (i) the increase in revenue described above. (ii) the revenue decline in 2009 compared with 2008 of $46 million as a result of the completion of the Camelot network contract. 10 12 Intersegment revenues . $550 $483 Carrier voice . OIBDA Year Ended December 31. remained highly competitive. . . . and the completion of the Camelot network contract. .

64 . . . (iii) higher real estate costs driven by higher facilities rent. security services and other data center products. (ii) higher payroll costs primarily as a result of higher headcount. broadband services. and managed services. broadband services. particularly in Brazil. 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Year Ended December 31. maintenance and utilities. and (v) higher third party maintenance costs. Our Brazilian business has expanded significantly and continues to lead the GC Impsat Segment in revenue contribution. In addition. . partially offset by: (i) higher third party maintenance. In addition. This increase in our GC Impsat Segment revenue was partially offset by foreign currency impacts which unfavorably impacted revenue in 2009 compared to 2008 by $24 million. network and operations costs and SG&A expenses were higher primarily due to higher employee related costs. OIBDA Year Ended December 31.2010 Compared to 2009 Revenue for our GC Impsat Segment increased in 2010 compared with 2009 primarily as a result of continuing demand for our IP services. In addition. broadband services. . These factors were partially offset by: (i) higher access charges and cost of equipment sales driven by increased revenues and intercompany access charges. real estate. . and (ii) higher access charges as well as higher costs of equipment and other sales resulting from increased sales. . Revenue growth in 2010 included $27 million of favorable foreign exchange impacts. . IP services and data center products. partially offset by lower professional fees and lower annual employee incentive compensation. . (iv) an increase in other expenses driven by increased allocated corporate overhead costs and travel. 2009 Compared to 2008 OIBDA in the GC Impsat Segment increased in 2009 compared with 2008 primarily as a result of continuing demand for broadband services. inflation-related salary adjustments and litigation charges. . managed services and data center products. storage. Sales orders and revenue continue to show healthy growth in most Latin American countries. favorable foreign exchange impacts increased GC Impsat Segment OIBDA by $12 million in 2010 compared with 2009. . 2010 Compared to 2009 $176 $160 $16 10% $160 $138 $22 16% OIBDA in the GC Impsat Segment increased in 2010 compared with 2009 primarily as a result of continuing demand for our IP services. . including network management. . 2009 Compared to 2008 Revenue for our GC Impsat Segment increased in 2009 compared with 2008 primarily due to continuing demand for IP services. Our Brazilian business has expanded significantly and continues to lead the GC Impsat Segment in OIBDA contribution. . 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) GC Impsat OIBDA . Market trends continue to reflect increasing demand for converged information and communications technologies to enable productivity gains and cost savings for enterprises. and managed services and data center products. driven by higher average headcount. unfavorable foreign exchange impacts decreased OIBDA by $3 million in 2009 compared with 2008.

. . . . . . . 2010 Compared to 2009 $124 $89 $35 39% $89 $1 $88 NM OIBDA in our ROW Segment increased in 2010 compared with 2009 primarily as a result of: (i) revenue growth and improved sales mix.117 (11%) 352 404 (33%) 3 4 40% 15 11 NM $1.536 $99 (52) (1) 4 $50 9% (13%) (25%) 36% 3% 2010 Compared to 2009 Revenue in our ROW Segment increased in 2010 compared with 2009 primarily as a result of sales growth in IP. . . . . . . . . 2010 2009 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) Year Ended December 31.593 $1.216 Carrier voice . . 65 . . enterprise voice and managed services. . . partially offset by unpaid leave savings recorded in 2009. partially offset by a decline in carrier voice revenue and $3 million of unfavorable foreign exchange impacts. 2 3 Intersegment revenues . data center products and IP services in our enterprise. Carrier voice revenue decreased in 2009 compared with 2008 as we continued to manage the business to optimize margin performance. .ROW Segment Revenue Year Ended December 31. . OIBDA Year Ended December 31. . . These factors were partially offset by higher employee incentive compensation costs primarily due to accruing annual employee incentive compensation at a higher rate in 2010. 2009 2008 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) ROW OIBDA . . . . (iv) a decrease in bad debt expenses. . carrier data and indirect sales channel . and (v) lower non-income tax reserves.586 $1. carrier data and indirect sales channel. 2010. . conferencing. . This was partially offset by: (i) $14 million of unfavorable foreign exchange impacts. Revenue in 2009 compared with 2008 included $13 million for a customer buyout of certain long term obligations under an existing contract. . 313 352 Other . while revenue in 2009 included $13 million for one customer’s contract buyout of certain long term obligations in our enterprise. . . carrier data and indirect sales channel business.216 $1. . Revenue in 2010 included $4 million as a result of the inclusion of Genesis Networks in our results since October 29. . . The decline in carrier voice revenue was driven by attrition caused by pricing actions to optimize margin performance. and (ii) a decline in carrier voice revenue. . . . (ii) lower payroll costs driven by lower benefit contributions and sales commissions. . collaboration and managed services. . . . . 2009 Compared to 2008 Revenue for our ROW Segment increased in 2009 compared with 2008 primarily as a result of continuing demand for our higher margin enterprise voice services.257 $1. . (iii) a reduction in real estate restructuring reserves.586 $ 41 (39) (1) 6 $ 7 3% $1. . $1. . . 2010 2009 (in millions) $ Increase/ (Decrease) % Increase/ (Decrease) Year Ended December 31. . 2009 2008 (in millions) $ Increase/ % Increase/ (Decrease) (Decrease) ROW Enterprise. . 21 15 $1. . . .

on prevailing market conditions. Our ability to enter into new financing arrangements is subject to restrictions in our outstanding debt instruments (as described below under “Indebtedness”) and to the rights of ST Telemedia under our outstanding preferred shares.2009 Compared to 2008 OIBDA in our ROW Segment increased in 2009 compared with 2008 primarily as a result of: (i) $12 million of favorable foreign exchange impacts. From time to time we review our operations and may consider opportunities to strategically enhance. This depends to a degree on general economic. we issued $150 million aggregate principal amount of 9% senior notes (the “9% Senior Notes”) at an issue price of 100% of their par value. expected revenue growth trends and anticipated cost management and operating improvements. available cash and cash available from financing activities will be adequate to meet our future liquidity needs for at least the next twelve months. near term maturities and available terms. Based on our current level of operations. On November 16. network and operations costs and SG&A expenses resulted primarily from lower employee-related expenses and other costs. additional capital investment in our network and service infrastructure and opportunistic acquisitions. The improvement in ROW Segment OIBDA in 2009 compared with 2008 was moderated by: (i) a $2 million retroactive property tax assessment described above. The lower employee-related expenses were driven by: (a) lower average headcount. and (b) lower annual employee incentive compensation. net in our consolidated statement of operations for 2010 is a charge of $6 million recorded in connection with the early extinguishment of the 5% Convertible Notes. We cannot provide assurances that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. among other things. that currently anticipated operating improvements will be realized on schedule or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. At any given time we may pursue a variety of financing opportunities. professional fees and other transaction fees and expenses in connection with the offering. We used the proceeds from the issuance of the 9% Senior Notes to: (i) redeem the 5% Convertible Notes at an optional redemption price equal to 101% of their principal amount. and (iii) lower real estate. and (ii) higher third party maintenance resulting from an increase in non-recurring network maintenance. network and operations and SG&A expenses. however. Initiatives that may result from such reviews may include. plans to reduce our operating expenses and/or optimize existing operating resources. 2010. Liquidity and Capital Resources Financial Condition and State of Liquidity Our ability to make payments on and to refinance our indebtedness and to fund planned capital expenditures will depend on our ability to generate cash in the future. There can be no assurance. including advertising and travel. See below in this Item 7 under “Indebtedness” for a description of the 9% Senior Notes. We may need to refinance all or a portion of our indebtedness on or before maturity. expansion of existing or entry into complementary lines of business. The lower real estate. financial. Included in other income (expense). legislative. (ii) increased revenue due to continuing demand for our higher margin products and services described above and a customer buyout of certain long term obligations under an existing contract in 2009 of $13 million. and (ii) pay the estimated initial purchaser discounts. that our business will generate sufficient cash flow from operations. At any given time in connection with the foregoing we may be engaged in varying levels of analyses or negotiations with potential counterparties. competitive. If we pursue any such 66 . regulatory and other factors (such as satisfactory resolution of contingent liabilities) that are beyond our control. and our decision to proceed with any financing will depend. we believe our future cash flow from operations. We monitor our capital structure on an ongoing basis and from time to time we consider financing and refinancing options to improve our capital structure and to enhance our financial flexibility. among others. expand or change our operations and leverage our capabilities.

At December 31. 2010. We conduct a significant portion of our business using the British Pound Sterling.S. 2010 by approximately $27 million. the appreciation of the U. However. Dollar value of cash balances held in those currencies. The official rate increased from 2. Our forecasted cash flows for 2011 contemplate lower sales of IRUs and prepaid services as compared to the $132 million in 2010. Dollar.S. and from ongoing cost management initiatives. 2010. We rely on the sale of IRUs and prepaid services. including initiatives to optimize the access network and effectively lower unit costs. we expect to generate positive cash flow from operating activities in an amount sufficient to fund all investing and financing requirements. Effective January 1.S. at December 31. “Risk Factors—Cautionary Factors That May Affect Future Result. This devaluation reduced our unrestricted cash and cash equivalents during the three months ended March 31. carrier data and indirect sales channel business. which often involve large dollar amounts and are difficult to predict. the Venezuela government further increased the official rate for goods and services deemed “essential” to 4.60 for goods and services deemed “essential”. In addition. Dollar to 4. the Euro and the Brazilian Real. Our operating cash flows in 2011 will be adversely impacted by incremental annual interest payments primarily resulting from the issuance of the 9% Senior Notes and the associated refinancing. This change had no effect on the carrying value of our cash and cash equivalents (see “Currency Risk” below in this Item 7 for further information related to foreign currency exchange restrictions and the impact of the devaluation of the Venezuelan bolivar). Since we tend to incur costs in the same currency in which we realize revenue. 67 • . During 2010. we may require additional equity or debt financing to consummate those transactions.” as well as to the variability of quarterly liquidity discussed below. We have exposure to significant currency exchange rate risks. the impact on operating income and operating cash flow is largely mitigated. our ability to improve cash flows is subject to the risks and uncertainties described under Item 1A. Thus. our available liquidity consisted of $372 million of unrestricted cash and cash equivalents. Our restricted cash and cash equivalents comprise cash collateral for letters of credit or performance bonds issued in favor of certain of our vendors and deposits securing real estate obligations. In addition.15 Venezuelan bolivares to the U. We also anticipate somewhat lower sales of IRUs and prepaid services in 2011 than realized in 2010. Appreciation of the U. Dollar relative to foreign currencies reduces the U. subject to the need to refinance some or all of our existing major debt instruments as described below. Dollar adversely impacts our consolidated revenue. However. 2010. we held $9 million in restricted cash and cash equivalents. it may place greater demands on our cash flows due to increased capital and operating expenses and debt service. 2011.30 for goods and services deemed “nonessential” and 2. including the economies of scale expected to result from such growth. improvements in underlying operating results are expected to largely offset these factors such that we currently expect cash provided by operating activities (including IRUs and other prepaid sales) to exceed purchases of property and equipment for the full year 2011. This expectation is based in part on raising financing for such property and equipment from vendors and others in amounts similar to those arranged in 2010. In addition.S. If we undertake such initiatives. we received $132 million of cash receipts from the sale of IRUs and prepaid services compared to $130 million in 2009. the Venezuelan government devalued the Venezuelan bolivar. Effective January 12.30 Venezuelan bolivares to the U. we expect our operating results and cash flows to continue to improve as a result of the continued growth of our higher margin enterprise. in the long term. Our ability to arrange such financings is subject to negotiating acceptable terms from equipment vendors and financing parties. and there can be no assurance that we will be able to obtain such financing on favorable terms or at all.S.initiatives or transactions. our short-term liquidity and more specifically our quarterly cash flows are subject to considerable variability as a result of the timing of interest payments as well as the following factors: • • Working capital variability significantly impacts our cash flows and causes our intra-quarter cash balances to drop to levels significantly lower than those prevailing at the end of a quarter. In the long term.

as of December 31. Our liquidity may also be adversely affected if we settle or are found liable in respect of contingent legal. Cash outlays for purchases of property and equipment can vary significantly from quarter to quarter due primarily to the timing of major network upgrades. Our subsidiaries are incorporated and operate in various jurisdictions throughout the world and are subject to legal and contractual restrictions affecting their ability to make intercompany funds transfers. subsequent quarterly preferred stock dividends in the amount of $0. Therefore.S. the majority of our capital expenditures are directly related to customer requirements and therefore ultimately generate long-term cash flows. In addition. 68 . As a result. January and April. attributing to the bolivar a value that is greater than the value using the SITME exchange rate. and (iii) the $150 million original principal amount of the 9% Senior Notes matures in 2019. However. However. (ii) the $750 million original principal amount of the 12% Senior Secured Notes matures in 2015. We do not expect to generate sufficient cash flows from operations to repay all of these debt instruments at maturity. In addition. 2011. we are dependent on access to the capital markets to meet our liquidity requirements. See below in this Item 7 under “Currency Risk” for further information. which prohibition applies to most of our subsidiaries given their history of operating losses. October. Dollars using the SITME. Such access will depend on market conditions and our credit profile at the relevant times. which itself values the bolivar at a greater rate than that which we believe would prevail in an unregulated open market. 2011 of accrued dividends accumulated since the preferred stock was issued in December 2003 through March 31. Contractual restrictions on intercompany funds transfers include limitations in our major debt instruments on the ability of our subsidiaries to make dividend and other payments on equity securities. Although we have the flexibility to reduce expected capital expenditures in future periods to conserve cash. the 12% Senior Secured Notes indenture and the 9% Senior Notes indenture do not restrict the ability of our subsidiaries in the ROW and GC Impsat Segments to transfer funds to GCL. as well as limitations on our subsidiaries’ ability to make intercompany loans or to upstream funds in any other manner. Dollars have resulted in the buildup of a material excess bolivar cash balance. With regard to our other major debt instruments. which is carried on our books at the official exchange rate. during the second quarter of 2011 we anticipate making an offer to purchase approximately $17 million of the GCUK Notes pursuant to the 2010 Excess Cash Offer (see “Indebtedness—GCUK Senior Secured Notes” below). 2010 we had $26 million of “other current liabilities” representing accrued dividends on our 2% cumulative senior convertible preferred stock.S. • • The vast majority of our long-term debt and capital lease obligations mature after 2013.9 million are expected to be payable on the fifteenth day of each July. which objective we achieved during 2010. although such restrictions do apply to our GCUK Segment due to restrictions in the GCUK Notes indenture. After the initial payment on or after April 15. we have approximately $61 million in various debt agreements that are due and payable in the next twelve months.• Restrictions on the conversion of the Venezuelan bolivar into U. reported results would be further adversely affected. and the amount and timing of the resolution of these contingencies remain uncertain. if we further determined that the SITME conversion rate should be used in the future to measure assets. liabilities and transactions. If we were required to convert our Venezuelan subsidiary’s cash balances into U. we would incur currency exchange losses in the period of conversion. tax and other liabilities. As a holding company. we are dependent upon intercompany transfers of funds from our subsidiaries to meet our debt service and other payment obligations. as well as foreign exchange controls on the use of certain mechanisms to covert and expatriate funds that are particularly prevalent in Latin America. Payment of the preferred dividend is predicated on our achieving a certain earnings-related objective as demonstrated by audited financial statements. Such legal restrictions include prohibitions on paying dividends in excess of retained earnings (or similar concepts under applicable law). all of our revenue is generated by our subsidiaries and substantially all of our assets are owned by our subsidiaries. Additionally. (i) the $429 million principal amount of the GCUK Notes matures in 2014 (less any amounts purchased as a result of future Excess Cash Offers). These contractual restrictions arise under our major debt instruments.

which. Moreover.At December 31. (4) enter into arrangements that restrict dividends or other payments to us from our restricted subsidiaries. These covenants are subject to a number of important limitations and exceptions. 2010. Accordingly. GCUK Segment borrowed $20 million from the ROW Segment to ensure cash balances were at prudent levels upon completion of the annual Excess Cash Offer for the GCUK Notes. including capital stock of subsidiaries. Interest on the notes accrues at the rate of 9% per annum and is payable semiannually in arrears on May 15 and November 15 of each year through maturity. could result in an acceleration of all such debts. among other things. financial condition and liquidity. The 9% Senior Notes are guaranteed by the vast majority of our direct and indirect subsidiaries other than the subsidiaries comprising the GCUK Segment and certain other subsidiaries described in the notes indenture. 2010. Such acceleration would adversely affect our rights under certain commercial agreements and have a material adverse effect on our business. we had $1. We believe that this loan. (2) pay dividends or make other distributions. consisting of $737 million of 12% Senior Secured Notes ($750 million aggregate principal less $13 million of unamortized discount). The 9% Senior Notes and the guarantees are senior unsecured obligations. we issued $150 million aggregate principal amount of 9% Senior Notes at an issue price of 100% of their par value. (6) sell assets. Operational constraints require us to maintain significant minimum cash balances in each of our segments. If the indebtedness under any of our loan instruments were to be accelerated. and $143 million of capital lease obligations and other debt. (3) make certain investments (including investments in the GCUK Segment). $150 million of 9% Senior Notes. (8) merge or consolidate with other companies or sell substantially all of our assets. and $126 million at our GCUK. unrestricted cash and cash equivalents were $76 million. an uncured default by the obligors under our Principal Debt Instruments or certain of our Capital Lease Facilities could trigger cross-default provisions under other such instruments or facilities. 2011. which may not be available on favorable terms. on a timely basis or at all. 2010. We are in compliance with all covenants under our material debt agreements and expect to continue to be in compliance. there can be no assurance that our assets would be sufficient to repay such indebtedness in full. results of operations. 9% Senior Notes On November 16.461 billion of indebtedness outstanding (including long and short term debt and capital lease obligations). Failure to comply with the covenants in any of our debt instruments could result in an event of default. $431 million of GCUK Notes ($429 million aggregate principal plus $2 million of net unamortized premium). which is payable September 2013. GC Impsat and ROW Segments. Below are summaries of our principal debt instruments outstanding at December 31. During 2010. $170 million. and (9) designate subsidiaries as restricted. (5) create liens. The indenture governing the notes contains covenants that. restrict our ability and the ability of our restricted subsidiaries to: (1) incur or guarantee additional indebtedness or issue disqualified stock or preferred stock. (7) engage in transactions with affiliates. 69 . and any future intersegment funds transfers in amounts permitted by our debt instruments will be sufficient to enable each of our segments to reach the point of sustained recurring positive cash flow from operating and investing activities. In such event. commencing on May 15. we would have to raise funds from alternative sources. if not cured or waived. Indebtedness At December 31. 2010. Most of our assets have been pledged to secure our indebtedness. they rank equally in right of payment with all of our and the guarantors’ other existing and future senior indebtedness and are effectively subordinated to all of our and the guarantors’ existing and future secured indebtedness to the extent of the collateral securing such indebtedness. respectively (see below in this Item 7 under “Currency Risk” for information related to the devaluation of the Venezuelan bolivar).

accounts receivable from third parties and property. and 2016 and thereafter. In addition. 2010 was $1. 2014 at a price equal to 100% of their principal amount. Under specified circumstances. 2011. 2014. 102. Included in other income (expense).5%. on GCL’s and certain of the guarantor’s existing and future assets. 2015. we may redeem all or a part of the 9% Senior Notes at the redemption prices of 104.25% for each subsequent 90-day period until the registration default is cured. and increasing our consolidated cash balance. persons in offshore transactions in reliance on Regulation S under the Securities Act. Interest on the notes accrues at the rate of 12% per annum and is payable semi-annually in arrears on March 15 and September 15 of each year through maturity. 2013. plant and equipment (other than property. with the net cash proceeds of one or more equity offerings by GCL. We may also redeem any of the 9% Senior Notes at any time prior to November 15.S. up to a maximum rate of additional interest of 1.103 billion. including if the exchange offer would not be permitted by applicable law or SEC policy. The transaction was intended to simplify our capital structure and to improve our liquidity and financial flexibility by effectively extending the May 2012 maturity of our Term Loan Agreement. 2015 (the “12% Senior Secured Notes”) at an issue price of 97. which exceeds the $1.944% of their par value. plus a make-whole premium and accrued and unpaid interest. commencing on March 15. reducing contractual restrictions on intercompany transactions between our GC Impsat and ROW Segments. 2011 to November 15.0 billion threshold required to make restricted payments pursuant to certain of the exceptions to the covenants in the notes indenture. and (ii) pay the estimated initial purchaser discounts. net in our consolidated statement of operations for 2010 is a charge of $6 million recorded in connection with the early extinguishment of the 5% Convertible Notes. we are required to register an identical series of notes with the SEC and to offer to exchange those registered notes for the notes issued in connection with the initial offering by November 16. with such rate increasing by an additional 0. respectively. 2010. 2009. 2019 (the maturity date) would be $11 million.25% per annum on the principal amount of the notes. In addition. if any. we issued $750 million in aggregate principal amount of 12% senior secured notes due September 15. we and the guarantors would be required to file a shelf registration statement for the resale of the 9% Senior Notes. professional fees and other transaction fees and expenses in connection with the offering. on or after November 15. 70 . subject to possible extensions under certain circumstances. However. we are obligated to pay special interest in an amount equal to 0. At any time prior to November 15.25% or 100% of par during 2014. These assets generally include the “Specified Tangible Assets” (defined in the notes indenture as cash and cash equivalents.We used the proceeds from the issuance of the 9% Senior Notes to: (i) redeem the 5% Convertible Notes at an optional redemption price equal to 101% of their principal amount.00% per annum. The 9% Senior Notes are not registered under the Securities Act and the initial purchasers agreed to sell the notes only: (i) in the United States to qualified institutional buyers in reliance on Rule 144A under the Securities Act. The obligations of GCL and the guarantors in respect of the notes are senior obligations which rank equal in right of payment with all of their existing and future senior indebtedness. the 12% Senior Secured Notes are secured by first-priority liens. we may on any one or more occasions redeem up to 35% of the aggregate original principal amount of the 9% Senior Notes at a redemption price equal to 109% of the principal amount thereof. The book value of such “Specified Tangible Assets” as of December 31. The 12% Senior Secured Notes are guaranteed by the vast majority of our direct and indirect subsidiaries other than the subsidiaries comprising the GCUK Segment. plant and equipment under capital leases and leasehold improvements)) of GCL and the “Grantor Guarantors” organized in “Approved Jurisdictions” (as such terms are defined in the notes indenture). and (ii) outside the United States to non-U. 12% Senior Secured Notes On September 22. subject to certain exceptions. In the event of registration default. The maximum possible additional interest payable in the period from November 16. plus accrued and unpaid interest to the redemption date.

The indenture governing the notes contains covenants that. 2010. (8) merge or consolidate with other companies or sell substantially all of our assets. (2) pay dividends or make other distributions. we may on any one or more occasions redeem up to 35% of the aggregate original principal amount of the 12% Senior Secured Notes at a redemption price of 112% of the principal amount thereof. professional fees and other transactions fees and expenses in connection with the offering. plus a make-whole premium and accrued interest. plus accrued and unpaid interest to the redemption date. which resulted in our receiving gross proceeds. At any time prior to September 15. if any. we may redeem all or a part of the 12% Senior Secured Notes at the redemption prices of 106%. GCUK Finance issued an additional 52 million pounds sterling aggregate principal amount of pound sterling denominated GCUK Notes. we completed an offer to exchange the notes issued on September 22. and (9) designate subsidiaries as restricted. respectively. Interest is payable in cash semi-annually on June 15 and December 15. on or after September 15. (ii) purchase all of the GC Impsat Notes validly tendered in a tender offer for such notes. 2004. These covenants are subject to a number of important limitations and exceptions. 2012. 2013 and 2014. The GCUK Notes are senior obligations of GCUK Finance and rank equal in right of payment with all of its future debt. 2012 at a price equal to 100% of the principal amount. GCUK has guaranteed the GCUK Notes as a senior obligation ranking equal in right of payment with 71 . Global Crossing (UK) Finance Plc. (4) enter into arrangements that restrict dividends or other payments to us from our restricted subsidiaries. 2009 for an identical series of notes that have been registered under the Securities Act of 1933. of approximately $111 million. All $750 million aggregate outstanding principal amount of notes participated in the exchange offer which satisfied an obligation incurred by us under a registration rights agreement that we entered into in connection with the original issuance of the notes. before underwriting fees. On December 28. The additional notes were issued at a premium of approximately 5 million pounds sterling. The U. including capital stock of subsidiaries.75% pounds sterling denominated senior secured notes due 2014. Included in other income (expense). limit our ability and the ability of our subsidiaries (other than those comprising the GCUK Segment) to: (1) incur or guarantee additional indebtedness or issue disqualified stock or preferred stock. We may also redeem any of the 12% Senior Secured Notes at any time prior to September 15. 2006.75% U. On August 2. (6) sell assets. (7) engage in transactions with affiliates. the remaining $125 million was used for general corporate purposes. and (iii) pay the estimated initial purchaser discounts. 2012. In addition. including a consent fee of 5% of the principal amount of those notes tendered by the early withdrawal date (total cost of $237 million). (3) make certain investments (including investments in the GCUK Segment). We used the proceeds from the issuance of the 12% Senior Secured Notes to: (i) repay the Term Loan Agreement in full. 103% or 100% of par. The GCUK Notes mature on the tenth anniversary of their issuance. before underwriting fees. Dollar denominated senior secured notes due 2014 and 105 million pounds sterling aggregate principal amount of 11. respectively. GCUK Senior Secured Notes On December 23. together with a 1% prepayment penalty and unpaid interest to but not including the date of repayment (total cost of $348 million). which resulted in our receiving gross proceeds. Dollar and pound sterling denominated notes were issued at a discount of approximately $3 million and 2 million pounds sterling. After these costs. (5) create liens. of approximately $398 million. with the net cash proceeds of one or more equity offerings by GCL. net in our consolidated statements of operations for 2009 is a charge of approximately $29 million recorded in connection with the early extinguishment of the GC Impsat Notes and Term Loan Agreement.S.S. a wholly owned financing subsidiary of GCUK (“GCUK Finance”) issued $200 million in aggregate principal amount of 10. among other things. as amended (the “Securities Act”) with the Securities and Exchange Commission (the “SEC”).

GCUK Finance may also redeem either series of notes. exclusive of accrued but unpaid interest. in whole but not in part. Other Financing Activities During 2010. (v) enter into certain transactions with affiliates. but certain material assets of GCUK do not serve as collateral for the GCUK Notes. including its independent members. Under the indenture. These agreements have terms that range from 12 to 48 months with a weighted average effective interest rate of 11. upon certain changes in tax laws and regulations.375% (for the U. GCUK must offer (the “Excess Cash Offer”) to purchase a portion of the GCUK Notes at a purchase price equal to 100% of their principal amount. we made an offer for $18 million and purchased less than $1 million in principal amount of the GCUK Notes. and (vii) consolidate. if any. among other things: (i) incur or guarantee additional indebtedness. The total debt obligation resulting from these agreements was $15 million. Any such offer is required to be made within 120 days of year-end. GCUK Finance may redeem the GCUK Notes in whole or in part. (iii) make investments or other restricted payments. to the purchase date. so long as GCUK is not then in default under the indenture. The indenture governing the GCUK Notes limits GCUK’s ability to. plus accrued and unpaid interest. (iv) create liens. we entered into various capital leasing arrangements that aggregated $41 million. In the exercise of their fiduciary duties. The terms of any inter-company loan by GCUK to us or our other subsidiaries are required by the GCUK Notes indenture to be at arm’s length and must be agreed to by the board of directors of GCUK. The GCUK Notes were issued under an indenture which includes covenants and events of default that are customary for high-yield senior note issuances. A loan or dividend payment by GCUK to us and our affiliates is a restricted payment under the indenture governing the GCUK Notes. In addition. (ii) may generally be made only within ten business days of consummation of each Excess Cash Offer. (ii) pay dividends or make other distributions to repurchase or redeem its stock. GCUK’s directors will require GCUK to maintain a minimum cash balance in an amount they deem prudent. In addition. Dollar denominated notes) or 105.1%. With respect to the 2010 Excess Cash Offer.all of its existing and future senior debt. (vi) enter into agreements that restrict the ability of its material subsidiaries to pay dividends. The GCUK Notes are secured by certain assets of GCUK and GCUK Finance. These agreements have terms that range from 6 to 48 months with a weighted average effective interest rate of 10%. 2010) in the aggregate in restricted payments in excess of 50% of Designated GCUK Cash Flow for a given period. 72 . merge or sell all or substantially all of its assets. including the capital stock of GCUK Finance.875% (for the pounds sterling denominated notes) in 2009 to 100% of the principal amount in 2012 and thereafter. exclusive of accrued but unpaid interest. With respect to the 2009 Excess Cash Offer. GCUK may make up to 10 million pounds sterling (approximately $15 million at the exchange rate at December 31. using 50% of “Designated GCUK Cash Flow” from that period. we anticipate making an offer of approximately $17 million. 2009 at redemption prices decreasing from 105. such a payment (i) may be made only if GCUK is not then in default under the indenture and would be permitted at that time to incur additional indebtedness under the applicable debt incurrence test. As required by the indenture governing the GCUK Notes.S. and the associated purchases are required to be completed within 150 days after year-end. calculated in accordance with the terms of the indenture governing the GCUK Notes. “Designated GCUK Cash Flow” means GCUK’s consolidated net income plus non-cash charges minus capital expenditures. we entered into various debt agreements to finance various equipment purchases and software licenses. at any time on or after December 15. within 120 days after the end of each twelve month period ending December 31. if any. and (iii) would generally be limited to 50% of Designated GCUK Cash Flow plus the portion. provided that any such excess payments shall reduce the amount of restricted payments permitted to be paid out of future Designated GCUK Excess Cash Flow. of the applicable Excess Cash Offer that the holders of the notes decline to accept.

. . . . . . .658 $205 32 360 — 161 $758 Includes both principal and interest on obligations. . . . . . . Net cash flows provided by (used in) financing activities . . . . net of cash acquired. . . . . . . . . . . . we made $157 million of interest payments compared with $117 million in 2009.Cash Management Impacts Condensed Consolidated Statements of Cash Flows Year Ended December 31. . . .115 158 783 1 781 $3. . . . . . . . . . . . . . The principal repayment of the GCUK Notes of approximately $429 million includes $17 million and $412 million in the “Less than 1 year” and “3-5 years” section of the table. 2010 2009 (in millions) $ Increase/ (Decrease) Net cash flows provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Contractual Cash Commitments The following table summarizes our contractual cash commitments at December 31. Cash Flows from Investing Activities Cash flows used in investing activities in 2010 was flat when compared with 2009. . . . . . . . . . Cash Flows from Financing Activities Cash flows provided by financing activities decreased in 2010 compared with 2009 primarily as a result of the net cash received in connection with the issuance of the 12% Senior Secured Notes as part of refinancing debt in 2009. The $17 million represents the portion of the Excess Cash Offer we expect to offer holders of the GCUK Notes within 120 73 . . . Total . . . . . . . . . . . During 2010. . . . respectively. . . . Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . $ 183 (168) (95) (25) $ 256 (168) 26 3 $ 117 $ (73) — (121) (28) $ (105) $ (222) Cash Flows from Operating Activities Cash flows provided by operating activities decreased in 2010 compared with 2009 primarily as a result of higher cash payments for interest and incentive compensation payments in 2010 and a larger benefit from improved collection of receivables in 2009. . . . . . During 2010 we received $132 million of cash receipts from the sale of IRUs and prepaid services compared with $130 million in 2009. . . . . . . . . . . . Capital lease obligations(1) . . . . Operating lease obligations . . . . . . . . we paid $7 million for the acquisition of Genesis Networks. . . . . . . . .838 $180 61 103 1 335 $680 $312 53 171 — 206 $742 $1. Net cash flows used in investing activities . Annual incentive compensation was primarily paid in cash in 2010 versus payment in stock in 2009. . . . . . . . . . . . . . . . . . . . . Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . . . (1) (2) $2. Pension obligations(3) . . . . . . . . . . . . . . . . . . . partially offset by a decrease of $7 million in capital expenditures. . . . . . . During 2010. . . . . . . 2010: Total Less than 1 year (2011) 1-3 years 3-5 years (2012-2013) (2014-2015) (in millions) More than 5 years Long-term debt obligations(1)(2) . .418 12 149 — 79 $1. . . . . . . . . . . . . . . . . Purchase and other obligations(4) . . . . .

S.S. other purchase order commitments ($175 million). Declines in the value of foreign currencies (such as the devaluation of the Venezuelan bolivar discussed below) relative to the U.S. Dollars. of our consolidated receivables. liabilities and transactions of our Venezuelan subsidiary. Currency Risk Certain of our current and prospective customers derive their revenue in currencies other than U. of our consolidated receivables. The official rate increased from 2. an agency of the Venezuelan government. Dollar to 4. 74 . The pound sterling interest and principal due for the GCUK Notes have been translated for all periods at the December 31. Dollars to one pound sterling. As the Excess Cash Offer will vary from period to period. Funding amounts will vary yearly based on actuarial assumptions. our operating results may suffer due to currency translations in the event that such currencies depreciate relative to the U. Dollars. Furthermore. Dollars.S. Dollars but are invoiced by us in U. As of December 31. 2010 year end rate of 1. Credit Risk We are subject to concentrations of credit risk in our trade receivables. maintenance services for portions of our network and information technology ($309 million).S. The official rate is the rate used by the Comisión de Administración de Divisas (“CADIVI”). In addition. our receivables due from various agencies of the U. Certain Latin American economies have experienced shortages in foreign currency reserves and have adopted restrictions on the use of certain mechanisms to expatriate local earnings and convert local currencies into U. where we issue invoices for our services in currencies other than U. respectively. our receivables related to our carrier sales channels represented approximately 42% and 43%. We use the official rate to record the assets. Dollars.(3) (4) days of December 31. and other ($4 million). The obligations of customers with revenue in foreign currencies may be subject to unpredictable and indeterminate increases in the event that such currencies depreciate in value relative to the U. Dollar and we cannot or do not elect to enter into currency hedging arrangements in respect of those payment obligations.S. Dollar could adversely affect our ability to market our services to customers whose revenue is denominated in those currencies. the affected customers may not be able to pay us in U. Although our receivables are geographically dispersed and include customers both large and small and in numerous industries. In Venezuela.S. Dollar. to exchange bolivares pursuant to an official process that requires application and government approval.K. we have not predicted early purchases of the GCUK Notes beyond 2010. respectively. 2010 and 2009. 2010. the official bolivares—U. our receivables from our carrier sales channels are generated from sales of services to other carriers in the telecommunications industry. rental payments for restructured properties ($63 million). In addition.S. currency devaluations in one country may have adverse effects in another country. Amount relates to our current expected funding requirements in 2011 related to our defined benefit pension plans.30 for goods and services deemed “non-essential” and 2. the Venezuelan government devalued the Venezuelan bolivar. This devaluation reduced our net monetary assets (including unrestricted cash and cash equivalents) by approximately $27 million based on the bolivares balances as of such date. In either event. Dollars and to expatriate such funds for the purpose of making timely payments of interest and principal on our indebtedness.S. 2010 and 2009.542 U. Effective January 12.S. Any such shortages or restrictions may limit or impede our ability to transfer or to convert such currencies into U.S. such customers may become subject to exchange control regulations restricting the conversion of their revenue currencies into U.S.S. Dollar exchange rate established by the Venezuelan Central Bank (“BCV”) and the Venezuelan Ministry of Finance has historically attributed to the bolivar a value significantly greater than the value that prevailed on the former unregulated parallel market. Also as of December 31.15 Venezuelan bolivares to the U. Amounts represent contractual commitments with third parties to purchase network access services ($230 million). Dollars. company funding policy and statutory funding requirements and therefore we have not included amounts beyond 2011. 2010.60 for goods and services deemed “essential”. government together represented approximately 5% and 5%.

pay dividends or otherwise expatriate capital is subject to either the limitations and restrictions of the SITME or the CADIVI registration. At December 31. The loss of $2 million was included in other income (expense). As indicated above. To date.S. As of December 31. commenced operations and established an initial weighted average implicit exchange rate of approximately 5. liabilities and transactions. net in our consolidated statement of operations for 2010.S. net in our consolidated statement of operations for 2010. application and approval process. Subject to the limitations and restrictions imposed by the BCV. Some approvals have been issued within a few months while others have taken more than one year. These amounts do not include any allocated corporate overhead costs or transfer pricing adjustments. In an attempt to control inflation. our Venezuelan subsidiary had $37 million of net monetary assets of 75 . a new regulated currency trading system controlled by the BCV. Dollardenominated bonds at par value in connection with our currency exchange risk mitigation efforts.S. In June 2010. Accordingly.S.S. Dollar.S. The purpose of the new regulated system is to supplement the CADIVI application and approval process with an additional process that allows for quicker and smaller exchanges. Additionally.S. Dollars at both the essential and non-essential official rates. 2011. we participated in a debt auction held by the Venezuelan government to purchase $10 million par value of U. Approvals under the CADIVI process have been less forthcoming at times. resulting in a significant buildup of excess cash in our Venezuelan subsidiary and a significant increase in our exchange rate and exchange control risks. on May 18. the conversion of bolivares into foreign currencies is limited by the current exchange control regime.S.resulting in a corresponding foreign exchange loss. we had $14 million of obligations registered and subject to approval by CADIVI for the conversion of bolivares into foreign currencies. approximately $37 million (valued at the fixed official CADIVI rate of 4. the acquisition of foreign currency by Venezuelan companies to honor foreign debt. distribute dividends or otherwise expatriate capital using the official Venezuelan exchange rate. 2010. we participated in a debt auction held by the Venezuelan government and used bolivares to purchase $10 million of U. the Venezuelan government announced that the unregulated parallel currency exchange market would be shut down and that the BCV would be given control over the previously unregulated portions of the exchange market. if we were to determine in the future that the SITME rate was the more appropriate rate to use to measure bolivar-based assets. Dollar denominated securities through banks authorized by the BCV. We cannot predict the timing and extent of any CADIVI approvals to honor foreign debt. which resulted in an approximate 25% discount. included in other expense. net in our consolidated statements of operations. our Venezuelan subsidiary contributed approximately $52 million of our consolidated revenue and $30 million of our consolidated OIBDA. we have not executed any exchanges through SITME. in each case based on the CADIVI rate. and is also subject to the availability of foreign currency within the guidelines set forth by the National Executive Power for the allocation of foreign currency. Dollars.S. Effective January 1. The loss was included in other income (expense). we would incur currency exchange losses in the period of conversion based on the difference between the official exchange rate and the SITME rate. We received approval to purchase the bonds and sold these bonds immediately upon receipt at a price of $8 million paid in U. we received $9 million and $7 million. This change had no effect on the carrying value of our cash and cash equivalents. Dollar at December 31. If we were to successfully avail our self of the SITME process to convert a portion of our Venezuelan subsidiary’s cash balances into U. which resulted in an approximate 27% discount. of approvals from CADIVI to convert bolivares to U. For 2010. As of December 31. respectively. entities domiciled in Venezuela may access the SITME by buying U. In 2010. Dollar-denominated bonds in connection with our currency exchange risk mitigation efforts. reported results would be further adversely affected. During 2010 and 2009. the Transaction System for Foreign Currency Denominated Securities (“SITME”). Dollars. the Venezuela government further increased the official rate for goods and services deemed “essential” to 4.30 Venezuelan bolivares to the U. 2010. In 2008.30 bolivares to the U. The purchase price of the bonds was $11 million. 2010 (the “CADIVI rate”)) of our cash and cash equivalents was held in Venezuelan bolivares. We received approval to purchase the bonds and sold these bonds immediately upon receipt at a price of $8 million. Dollar.30 Venezuelan bolivares to the U. 2010. 2010.

As of December 31. representing $48 million from subleases already entered into and $16 million from subleases projected to be entered into in the future. The liabilities associated with this restructuring plan have been accounted for as part of the purchase price of Impsat. we adopted a restructuring plan as a result of the Impsat Fiber Networks.S. Dollar relative to foreign currencies reduces the U. Below is a description of our significant restructuring plans: 2007 Restructuring Plan During 2007. 2010. 2010). the appreciation of the U. our Venezuelan subsidiary had $70 million of net assets. As a result. 2004 and it is anticipated that the remainder of the restructuring liability. As a result of these activities. In addition. Appreciation of the U.S. the impact on operating income and operating cash flow is largely mitigated.S. We conduct a significant portion of our business using the British Pound Sterling. 2003 and Prior Restructuring Plans Prior to our emergence from bankruptcy on December 9. In July 2009.S. 2010 and 2009. offset by anticipated receipts from existing and future third-party subleases. In light of the Venezuelan exchange control regime. we adopted certain restructuring plans as a result of the slowdown of the economy and telecommunications industry. As of December 31. “Basis of Presentation and Significant Accounting Policies” to the accompanying consolidated financial statements for a full description of recently issued and recently adopted accounting pronouncements including the date of adoption and effects on results of operations and financial condition. where applicable. Dollars and held outside of Venezuela) may be transferred to GCL in the form of loans. as well as our efforts to restructure while under Chapter 11 bankruptcy protection. 2010 we did not have any off-balance sheet arrangements outstanding. Dollars and $33 million were denominated in Venezuelan bolivares at the CADIVI rate. CADIVI or SITME). Recently Issued and Recently Adopted Accounting Pronouncements For information on recently issued and recently adopted accounting pronouncements. respectively.e. In February 2010. we settled another claim initiated in November 2007 by a former officer of Impsat which was fully paid in April 2010. all related to the GC Impsat Segment. we incurred cash restructuring costs of approximately $8 million for severance and related benefits. Since we tend to incur costs in the same currency in which we realize revenue. will be paid through 2025. see Note 2. advances or cash dividends without the consent of a third party (i. the remaining liability of the 2007 restructuring plan was $3 million and $7 million. 2003. is composed of continuing building lease obligations and broker commissions for the restructured sites (aggregating $73 million as of December 31.. Restructuring Activities At December 31. As of December 31. Off-Balance Sheet Arrangements As of December 31.S. restructuring liabilities are included in other current liabilities and other deferred liabilities in our consolidated balance sheets. all of which relates to facility closings. anticipated third party sublease receipts were $64 million. 2010 and 2009. Dollar adversely impacts our consolidated revenue. All amounts incurred for employee separations were paid as of December 31. none of these net assets (other than the $4 million of cash denominated in U. 2010. The undiscounted facilities closing reserve. Inc.which $4 million were denominated in U. we settled a claim initiated in October 2007 by a former director and officer of Impsat to be paid out in installments through February 2011. (“Impsat”) acquisition under which redundant Impsat employees were terminated. the Euro and the Brazilian Real. which represents estimated future cash flows. we eliminated employees and vacated facilities. 76 . Dollar value of cash balances held in those currencies.

. . Foreign currency impact . . $ 1 $ 1 $ — $ — $ — (1) (2) $ 151 $1.” For future indebtedness. . . . $ 26 $ 3 $ 3 $ 414 $ 750 Average interest rates . . . . . . .21% as of December 31. . . . . . . . . . . . . . . . . . our policy is to manage interest rates through use of a combination of fixed and floating rate debt (there has been no significant floating rate debt for some time). . . . . . .347 9. . . . . . . . . . . . . .16% as of December 31. . . . . 2009 Fair Fair 2012 2013 2014 2015 Thereafter Total Value Total Value (in millions U. . . 2019 (the “9% Senior Notes”) which is included in fixed rate long-term debt in the table above. . . . . .405 $ $ — 2 $ $ 11 6 $ $ 11 6 The interest rate is the Colombian consumer price index plus 8% which amounted to 10. . . . . . . . $ 18 6 (8) 1 $ 17 (6) (1) $ 10 ITEM 7A. . . 2009 . . . . . . . . . to the extent we are subject to interest rate risk. . . . . . . . . we issued $750 million in aggregate principal amount of 12% senior secured notes due September 15. .The table below reflects the activity associated with the restructuring reserve relating to the restructuring plans initiated during and prior to 2003 for the years ended December 31. . . . . . . . . . . . . . . . Deductions . . . . . . . . Deductions . . . . . . . . . . . . . . In 2009. . . . . . . . . . 2010 . . . . . 2010 and 2009: Facility Closings (in millions) Balance at January 1. . . . . . . . . we issued $150 million in aggregate principal amount of 9% senior notes due November 15. . . . . . . . . . . Interest rate swaps or other derivatives may be used to adjust interest rate exposures when appropriate based upon market conditions. . . . . . . . In 2010. . . . . . . . . . $ — $ — $ — $ — $ — Colombian working capital notes(2) . . . . . . . . . Balance at December 31. . . . .29% 12. . . . . . . . . . . . . . . We selectively use financial instruments to manage these risks. . .S. . . . . Principal (Notional Amount by Expected Maturity) 2011 December 31. . . . . . . . . . . . . . . . . . . . . . . . Change in estimated liability . . . 2009. . . . . . . . 10. . .30% 10. . We used part of the proceeds from the issuance of the 9% Senior Notes to repay the 5% Convertible Notes in full. . . .01% $ — $ — $ $ — 2 $1. . . . . . . . . . The interest rate is LIBOR plus 2. . . . . . . .50% 11. . . . . . . Balance at December 31. 2010 December 31. . . . . . . Our objective in managing exposure to changes in interest rates is to reduce volatility on earnings and cash flow associated with such changes. . 2015 (the “12% Senior Secured Notes”) which is included in fixed rate long-term debt in the table 77 . . . . . . . . . . . . . . 2010. . . . . . 2009 . . . . . . . . . . . .00% Variable Rate: Colombian notes(1) . . . . . . . . . . . . . . . . . . . . . .75% which amounted to 3. . . . . . Interest Rate Risk The table below provides information about our interest rate sensitive financial instruments and constitutes a “forward looking statement. . . . . . .458 $1.342 $1. . . . . . QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In the normal course of business we are exposed to market risk arising from changes in interest rates and foreign currency exchange rates that could impact our cash flows and earnings. . . . . . Dollars) LONG-TERM DEBT (INCLUDING CURRENT PORTION) Fixed Rate . . . . . . . . . . . . . Foreign currency impact . . . . . . . . . . . . . . . . . . . . . . . . . . .36% 10. . . . . . . . . . . . . . . . .

.” to the accompanying consolidated financial statements included in this annual report on Form 10-K.75% 11. financial instruments for speculation or trading purposes. . . . . British Pounds . . .75% (1) $— $— $— $ 6 $ 6 $ 6 $ 6 $ — $235 $ — $244 $ 11 $245 $ 11 $243 The interest rate is the Colombian consumer price index plus 8% which amounted to 10. including its principal executive and principal financial officers. Dollars) December 31.above. . 2009. . .” Principal (Notional Amount by Expected Maturity) 2011 2012 2013 2014 (in millions U. . . . without limitation. . . . . $ — $ — $ — $ — $— Average interest rates(1) . . .” for information about our currency restrictions.16% as of December 31. . CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Disclosure controls and procedures (as defined in Rule 13(a) -15(e) under the Exchange Act) are controls and other procedures that are designed to ensure that information required to be disclosed by a public company in the reports that it files or submits under the Exchange Act is recorded. We have not entered into. . ITEM 8. .75% 11. $ 9 $ — $ — $ 226 $— Average interest rates . . . . . . ITEM 9A. Foreign Currency Risk The table below provides information about our financial instruments subject to currency risk and constitutes a “forward looking statement. Additional information regarding financial instruments is contained in Note 10.75% 11. “Index to Consolidated Financial Statements and Schedule. . summarized and reported within the time periods specified in the SEC’s rules and forms.S. . FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA See the index included on page F-1 of this annual report on Form 10-K. 11. processed. . or persons 78 . . . . Disclosure controls and procedures include. . . . 2010 December 31. .50% Colombian Pesos . . . . . $ 6 $ — $ — $ — $— Average interest rates . “Debt” and Note 18. See Item 7 “Liquidity and Capital Resources. . and do not intend to enter into. . . . . .” ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. . We used part of the proceeds from the issuance of the 12% Senior Secured Notes to repay the Term Loan Agreement in full (variable rate debt) and purchase all of the GC Impsat Notes (fixed rate debt) validly tendered in a tender offer for such notes. .” for information on our indebtedness and “Currency Risk. 2009 Fair Fair 2015 Thereafter Total Value Total Value LONG-TERM DEBT (INCLUDING CURRENT PORTION) Swiss Francs . controls and procedures designed to ensure that information required to be disclosed by a public company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management. 7. “Financial Instruments.

We consider the ongoing integration of Impsat a material change in our internal control over financial reporting. Ernst & Young LLP. as appropriate to allow timely decisions regarding required disclosure. accurately and fairly reflect the transactions and dispositions of our assets. Internal control over financial reporting refers to a process designed by. and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors. 2007. with the participation of our Chief Executive Officer and Chief Financial Officer. In addition. our management concluded that our internal control over financial reporting was effective as of December 31.performing similar functions. in reasonable detail. Based on its evaluation. In connection with the preparation of this annual report on Form 10-K. Management reviewed the results of its assessment with the Audit Committee of our Board of Directors. Our independent registered public accounting firm. Management’s Report on Internal Control over Financial Reporting Management of GCL is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. there were no other material changes in our internal control over financial reporting during the fourth quarter of 2010 and year ended December 31. our Chief Executive Officer and Chief Financial Officer and effected by our board of directors. 2010. we acquired Impsat. pursuant to Rule 13a-15 under the Exchange Act. including those policies and procedures that: • • pertain to the maintenance of records that. Based upon management’s evaluation. or under the supervision of. 2010. use or disposition of our assets that could have a material effect on the financial statements. Disclosure controls and procedures include many aspects of internal control over financial reporting (as defined later in this Item 9A). management and other personnel. and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition. our management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Criteria”). or that the degree of compliance with the policies or procedures may deteriorate. has evaluated the effectiveness of our disclosure controls and procedures. Except as noted above. internal control over financial reporting cannot provide absolute assurance of the prevention or detection of misstatements. With the participation of the Chief Executive Officer and the Chief Financial Officer. We are currently in the process of incorporating Impsat’s internal controls into our control structure and migrating overlapping processes and systems to legacy Global Crossing processes and systems. • Because of its inherent limitations. projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions. has audited and issued a report expressing its opinion on the effectiveness of our internal control over financial reporting. Ernst & Young LLP’s report appears below in this Item 9A. our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31. 79 . management. provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles. Changes in Internal Control over Financial Reporting On May 9. to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. 2010.

Global Crossing Limited’s management is responsible for maintaining effective internal control over financial reporting. 2010. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. 2011 ERNST & YOUNG LLP 80 .Report of Independent Registered Public Accounting Firm The Board of Directors and Shareholders of Global Crossing Limited We have audited Global Crossing Limited’s internal control over financial reporting as of December 31. 2010 based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Global Crossing Limited maintained. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). in reasonable detail. 2011 expressed an unqualified opinion thereon. in accordance with the standards of the Public Company Accounting Oversight Board (United States). A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 2010 and 2009. accurately and fairly reflect the transactions and dispositions of the assets of the company. and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition. effective internal control over financial reporting as of December 31. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit. New Jersey February 23. and performing such other procedures as we considered necessary in the circumstances. use or disposition of the company’s assets that could have a material effect on the financial statements. and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company. the consolidated balance sheets of Global Crossing Limited and subsidiaries as of December 31. Because of its inherent limitations. internal control over financial reporting may not prevent or detect misstatements. (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles. 2010 of Global Crossing Limited. and our report dated February 23. and the related consolidated statements of operations. based on the COSO criteria. or that the degree of compliance with the policies or procedures may deteriorate. cash flows and comprehensive loss for each of the three years in the period ended December 31. Also. /s/ Iselin. We believe that our audit provides a reasonable basis for our opinion. shareholders’ equity (deficit). assessing the risk that a material weakness exists. projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions. in all material respects. In our opinion. Our audit included obtaining an understanding of internal control over financial reporting. We also have audited. and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information called for by this Item 10 will be contained in our definitive proxy statement for use in connection with our 2011 annual general meeting of shareholders.” The other information called for by this Item 12 will be contained in our definitive proxy statement for use in connection with our 2011 annual general meeting of shareholders. ITEM 12. Such information is incorporated into this annual report on Form 10-K by reference. Such information is incorporated into this annual report on Form 10-K by reference. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. ITEM 13. Such information is incorporated into this annual report on Form 10-K by reference. AND DIRECTOR INDEPENDENCE The information called for by this Item 13 will be contained in our definitive proxy statement for use in connection with our 2011 annual general meeting of shareholders. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information called for by Item 201(d) of Regulation S-K regarding securities authorized for issuance under equity compensation plans is contained in Item 5 above under the caption “Equity Compensation Plan Information. PART III ITEM 10. EXECUTIVE COMPENSATION The information called for by this Item 11 will be contained in our definitive proxy statement for use in connection with our 2011 annual general meeting of shareholders. Such information is incorporated into this annual report on Form 10-K by reference. ITEM 11. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information called for by this Item 14 will be contained in our definitive proxy statement for use in connection with our 2011 annual general meeting of shareholders. ITEM 14. Such information is incorporated into this annual report on Form 10-K by reference. OTHER INFORMATION None.ITEM 9B. 81 .

2 of the 2007 10-K). 2009 and 2008. Form of stock certificate for common stock of GCL (incorporated by reference to Exhibit 4.5 4. dated as of December 23. dated July 18. 2010. Financial Statements-Included in Part II of this Form 10-K: Report of Independent Registered Public Accounting Firm: Ernst & Young LLP. 2007 (incorporated by reference to Exhibit 3. Notes to Consolidated Financial Statements 2. filed on December 30. 2004.2 3. 2009. as trustee.0% Cumulative Senior Preferred Shares of GCL (formerly GC Acquisition Ltd. 2010 and December 31. the other subsidiaries of GCUK guaranteeing the notes. dated June 29.4 of the 2007 10-K). Certificate of Designations of 2. by and among Global Crossing (UK) Finance Plc (“GCUK Finance”). 2004 8-K”)). 2003 (incorporated by reference to Exhibit 4.5 of the 2007 10-K). 82 3.4 3.1 Amended and Restated Constitutional Documents of Global Crossing Limited (“GCL”) (incorporated by reference to Exhibit 3.1 4.’s 2001-2002 Annual Report on Form 10-K filed on December 8. GCUK.3 3. 2009 and 2008. Financial Statement Schedule—Included in Part II of this Form 10-K: Schedule II—Valuation and Qualifying Accounts 3. STT Communications Ltd. 2009 and 2008. and The Bank of New York. filed on March 13.3 . filed on March 26. 2006 (incorporated by reference to Exhibit 3.3 of the 2007 10-K). relating to the approximately $404 million aggregate original principal amount of senior secured notes due 2014 (incorporated by reference to Exhibit 4. 2010. Consolidated Balance Sheets as of December 31. 2007 (incorporated by reference to Exhibit 3. as Irish paying agent. Indenture. Exhibit Index: Exhibit Number Exhibit 3. Consolidated Statements of Cash Flows for the years ended December 31. Consolidated Statements of Operations for the years ended December 31. 2010. Consolidated Statements of Comprehensive Loss for the years ended December 31. 2009 and 2008. Certificate of Deposit of Memorandum of Increase of Share Capital. dated June 3..2 of GCL’s 2003 Annual Report on Form 10-K. AIB/BNY Fund Management (Ireland) Limited.2 4.2 of GCL’s current report on Form 8-K. Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31. as optionholder. 2004 (the “December 30. 2003 (the “2002 10-K”)). 2010. 2004 (the “2003 10-K”)).). Certificate of Deposit of Memorandum of Increase of Share Capital. dated as of December 9. FINANCIAL STATEMENT SCHEDULES (a) List of documents filed as part of this report: 1. 2008 (the “2007 10-K”)).1 of Global Crossing Ltd. EXHIBITS. 2004 (incorporated by reference to Exhibit 3.PART IV ITEM 15.1 of GCL’s 2007 Annual Report on Form 10-K. Certificate of Deposit of Memorandum of Increase of Share Capital. Amended and Restated Bye-Laws of GCL dated as of June 12.

Registration Rights Agreement. dated as of December 23. 2004. Collateral Agency Agreement. certain of its subsidiaries as obligors and the Hedging Counterparties named therein (incorporated by reference to Exhibit 4. both as collateral agent and indenture trustee relating to GCL’s 12% Senior Secured Notes due 2015 (incorporated by reference to Exhibit 4.1 of GCL’s current report on Form 8-K. as trustee.2 of the September 25.1 of GCL’s current report on Form 8-K. 2009. each of the guarantors identified therein. STT Crossing Ltd and STT Hungary Liquidity Management Limited Liability Company. relating to Convertible Notes (incorporated by reference to Exhibit 10. 2006 8-K”)). 2006 (the “December 29. dated as of December 28. between GCUK and GCUK Finance.Exhibit Number Exhibit 4.14 83 .11 4.1 to GCL’s current report on Form 8-K. dated as of December 23. by and among the registrant. 2007. among Fibernet Group Limited. Supplemental Indenture.6 4. Amendment No. dated as of December 9.1 of the December 30. Security Arrangement Agreement.. dated as of September 22.3 of the December 30. STT Hungary Liquidity Management Limited Liability Company. 2009 8-K”)).9 4.13 4. filed on February 23. dated September 22. by and among GCL. Fibernet UK Limited and Fibernet Limited. dated as of May 23.. dated as of August 27. 2004 8-K). 2 to Registration Rights Agreement. 2003.20 of GCL’s 2009 Annual Report on Form 10-K.4 Debenture. filed on September 25.12 4. GCUK and The Bank of New York. between GCL and STT Crossing Ltd ( incorporated by reference to Exhibit 4. 2009.10 4.3 of the September 25. 2010). in favor of The Bank of New York. Amendment No. 2004. as collateral agent (incorporated by reference to Exhibit 4.8 4.5 4. dated as of December 23. STT Crossing Ltd and STT Hungary Liquidity Management Limited Liability Company (incorporated by reference to Exhibit 10.7 4.2 of the December 30. by and among GCL and Wilmington Trust FSB. GCUK Finance. dated as of September 22. 2009. Amendment No. between GCL and STT Crossing Ltd (incorporated by reference to Exhibit 99.4 of the December 30. 2004 8-K). as trustee and collateral agent. 2009 8-K). by and among STT Communications Ltd. 2009 8-K). filed May 30. 2004 8-K). as trustee relating to GCL’s 12% Senior Secured Notes due 2015 (incorporated by reference to Exhibit 4. 2006). relating to the approximately 52 million pounds sterling aggregate original principal amount of senior secured notes due 2014 (incorporated by reference to Exhibit 4. 3 to Registration Rights Agreement. 4.10 of the 2003 10-K). GCUK. filed on December 29. Exchange and Registration Rights Agreement. 2006. between GCL and Singapore Technologies Telemedia Pte Ltd. Registration Rights Agreement. the guarantors identified therein and the initial purchasers relating to GCL’s 12% Senior Secured Notes due 2015 (incorporated by reference to Exhibit 4. 2004 8-K). The Bank of New York. and Wilmington Trust FSB. as chargors. 1 to Registration Rights Agreement. Indenture. dated as of December 23. 2004. STT Crossing Ltd. by and among GCL. 2006. relating to common and preferred shares (incorporated by reference to Exhibit 10. by and among GCL. 2004. 2009 (the “September 25.

2010. between John J. Legere (incorporated by reference to Exhibit 10.. Global Crossing Telemanagement.7 10.3 of GCL’s Quarterly Report on Form 10-Q for the quarter ended June 30. Legere and GCL incorporated by reference to Exhibit 10. 2008 10-Q”)).8 84 . 4.* Form of Non-Qualified Stock Option Agreement applicable to John J.* Second Amendment to Employment Agreement.1 of GCL’s Current Report on Form 8-K filed on November 16. 2008. dated as of June 24. as trustee relating to GCL’s 12% Senior Secured Notes due 2015 (incorporated by reference to Exhibit 4. 2008 (the “June 30. Except as hereinabove provided. Second Supplemental Indenture.. 2010).5 of GCL’s 2009 Annual Report on Form 10-K. dated as of March 11. by and among Budget Call Long Distance. 2010. and Wilmington Trust FSB..14 of GCL’s Quarterly Report on Form 10-Q for the quarter ended September 30.* Form of Non-Qualified Stock Option Agreement applicable to executive officers of GCL (incorporated by reference to Exhibit 10. Inc. the guarantors identified therein and the representatives of the initial purchasers of the Notes relating to GCL’s 9% Senior Notes due 2019 (incorporated by reference to Exhibit 4. Legere and GCL (incorporated by reference to Exhibit 10. dated November 16. between John J. by and among Global Crossing Limited.6 10. filed on August 6.15 First Supplemental Indenture.5 10.4 of GCL’s 2008 Annual Report on Form 10-K. 2006 (the “2005 10-K”)).1 of GCL’s Current Report on Form 8-K filed on November 16.18 10. each of the guarantors identified therein.* Third Amendment to Employment Agreement. 2006. as trustee relating to GCL’s 9% Senior Notes due 2019 (incorporated by reference to Exhibit 4. by and among Global Crossing Genesis Networks. 2008.2 Employment Agreement.8 of GCL’s 2005 Annual Report on Form 10-K. as trustee relating to GCL’s 12% Senior Secured Notes due 2015 (filed herewith).3 10. Inc.* 10. Inc. 2010). 2006 10-Q”)). 2010. Exchange and Registration Rights Agreement. between John J. Inc.Exhibit Number Exhibit 4. Global Crossing North American Networks. dated as of December 31. Inc. 2004 (the “September 30.* First Amendment to Employment Agreement. filed on March 4.16 4. dated as of August 15. Global Crossing Local Services.17 4. Inc. 2004 10-Q”)). dated November 16.23 of GCL’s Registration Statement on Form S-4 filed on June 18. 2009 (the “2008 10-K”).. between John J. Global Crossing Limited and Wilmington Trust FSB. GCL agrees to furnish to the SEC upon its request a copy of any instrument relating to long-term debt. 2006 (the “September 30.. 2004 filed on November 15. filed on March 16. 2010). Global Crossing Telecommunications. Legere and GCL (incorporated by reference to Exhibit 10. filed on February 23. dated as of December 31.* Form of Restricted Stock Unit Agreement applicable to directors of GCL. by and among Global Crossing Limited. Indenture. 2009. dated as of November 9. there is no instrument with respect to long-term debt of GCL and its consolidated subsidiaries under which the total authorized amount exceeds 10 percent of the total consolidated assets of GCL. Legere and GCL (incorporated by reference to Exhibit 10. 2006.. and to executive officers of GCL for grants made prior to 2007 (incorporated by reference to Exhibit 10. 2010.4 10. 2010). filed on November 9. Global Crossing Limited and Wilmington Trust FSB.1 of GCL’s Quarterly Report on Form 10-Q for the quarter ended September 30. 2008.9 of the 2002 10-K).

Singapore Technologies Telemedia Pte Ltd. 2007 10-Q). Amendment 1 to the Network Security Agreement dated as of February 1. dated as of June 1. (incorporated by reference to Exhibit 10.14 10.12 10..* Employment Agreement. Legere (incorporated by reference to Exhibit 10. and to executive officers of GCL for grants made prior to 2007 (incorporated by reference to Exhibit 10. between John A. the Federal Bureau of Investigation. Singapore Technologies Telemedia Pte Ltd.2 of the September 30.13 10.1 of the June 30. 2008 10-Q”)).18 of the 2007 10-K).* Form of Performance Based Restricted Stock Unit Agreement applicable to John J.2 of the June 30. Employment Agreement. between GCL (formerly GC Acquisition Ltd.7 to the 2003 10-K). 2007.).A. Department of Justice.).Exhibit Number Exhibit 10. 2007.1 of GCL’s Quarterly Report on Form 10-Q for the quarter ended March.15 of the September 30. 2008 (incorporated by reference to Exhibit 10.10 of the 2005 10-K).2 of the June 30.* Network Security Agreement dated as of September 24. Kritzmacher and GCL (incorporated by reference to Exhibit 10. between Héctor Alonso and GCL (incorporated by reference to Exhibit 10. 2008 10-Q). 31.10 10.* Form of Restricted Stock Unit Agreement applicable to John J.15 10. 2003.2 of the March 31. the U.11 of the 2005 10-K).* Form of Performance Based Restricted Stock Unit Agreement applicable to directors of GCL. 2008 (incorporated by reference to Exhibit 10.18 10.* Form of Performance Based Restricted Stock Unit Agreement applicable to executive officers of GCL for grants made after January 1.9 Form of Restricted Stock Unit Agreement applicable to executive officers of GCL for grants made in 2007 (incorporated by reference to Exhibit 10.* Letter agreement.19 10. 2008 10-Q). between Héctor Alonso and Impsat Argentina S. Legere (incorporated by reference to Exhibit 10.4 of the June 30.17 10. 2008.16 of the September 30. filed on May 8.13 of the 2002 10-K) (the “Network Security Agreement”).22 10. dated September 18.* Form of Indemnity Agreement applicable to directors and officers of subsidiaries of GCL (incorporated by reference to Exhibit 10.* Form of Indemnity Agreement applicable to directors and Executive Committee members of GCL (incorporated by reference to Exhibit 10.11 10. the Federal Bureau of Investigation.* Form of Restricted Stock Unit Agreement applicable to executive offers of GCL for grants made after January 1.* Form of Performance Based Restricted Stock Unit Agreement applicable to executive officers of GCL for grants made in 2007 (incorporated by reference to Exhibit 10. Department of Justice. 2004 10-Q).20 10. dated as of June 1.S. GCL (formerly GC Acquisition Ltd. 2008 10-Q).1 of the June 30. the Department of Defense and the Department of Homeland Security (incorporated by reference to Exhibit 10. 2008. 2007 10-Q). 2007 10-Q). between Global Crossing Ltd. 2008 (the “March 31.S.21 10. the Department of Defense and the Department of Homeland Security (incorporated by reference to Exhibit 10.* 10. 2004 10-Q).16 10. 2007. 2008 10-Q).* Global Crossing Limited Senior Executive Short Term Incentive Compensation Plan (incorporated by reference to Exhibit 10. the U.23 85 .

Certification by John A. Consent of Ernst & Young LLP (filed herewith). filed on August 3.1 32.1 of GCL’s Quarterly Report on Form 10-Q for the quarter ended June 30. Certification by John J.Exhibit Number Exhibit 10. Certification by John J. pursuant to 18 U. 2010 ((incorporated by reference to Exhibit 10. 2010 ).S.1 31. contract or arrangement 86 .2 of GCL’s Quarterly Report on Form 10-Q for the quarter ended June 30. Section 1350. 2009. 2010. as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).1 of GCL’s Quarterly Report on Form 10-Q for the quarter ended March. Chief Executive Officer of GCL.C. pursuant to 18 U. filed on August 4. Kritzmacher. as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).* Computation of Ratio of Earnings to Fixed Charges (filed herewith). Chief Financial Officer of GCL pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).1 23. Section 1350. as amended on July 8. 2010 ). filed on May 4.2 32.26 12. 10.1 31.* Global Crossing 2010 Discretionary Incentive Bonus Program (incorporated by reference to Exhibit 10. Certification by John A. Subsidiaries of GCL (filed herewith).* 2003 Global Crossing Limited Stock Incentive Plan.2 * Denotes management contract or compensatory plan. Legere. Legere. Chief Financial Officer of GCL.24 Amended and Restated Global Crossing Limited Key Management Protection Plan (incorporated by reference to Exhibit 10. 2009. 31.C.1 21. Kritzmacher. 2010.25 10. Chief Executive Officer of GCL pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).S.

SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934. LEGERE John J. Legere Chief Executive Officer S-1 . the registrant has duly caused this report to be signed on its behalf on February 28. 2011 by the undersigned. GLOBAL CROSSING LIMITED By: /s/ JOHN J. thereunto duly authorized.

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. . . . . . . . . . . . . . . . . . . . . . Schedule: F-2 F-3 F-4 F-5 F-6 F-7 F-8 Schedule II—Valuation and Qualifying Accounts . . . . . . . . Consolidated Statements of Operations for the years ended December 31. . . . . . . . . . . . . . . . . . . . . 2009 and 2008 . . . . . . . . . . . . . . . . . . . Consolidated Balance Sheets as of December 31.GLOBAL CROSSING LIMITED AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE Page Report of Independent Registered Public Accounting Firm: Ernst & Young LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Consolidated Statements of Comprehensive Loss for the years ended December 31. . . . . . . . . . . . . . . . 2010. . . . . . . . . . . . . . 2010. . F-65 F-1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Notes to Consolidated Financial Statements . . . . . . . . 2010 and December 31. . . . . . . . . . . . . . . . . . . 2009 and 2008 . . 2009 and 2008 . . . . . . . . . . . . . . . . . . . . . 2010. . . . . . . . . . . . . . . . . . . . . . . . . . 2010. . . 2009 . . . . . . . . . 2009 and 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . Consolidated Statements of Cash Flows for the years ended December 31. . . . . . . . Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31. . . . . . . . . . . .

based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 23.S. generally accepted accounting principles. We also have audited. and comprehensive loss for each of the three years in the period ended December 31. as well as evaluating the overall financial statement presentation. Also in 2009. Also. 2011 ERNST & YOUNG LLP F-2 . 2010. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. As discussed in Note 2 to the consolidated financial statements. Our audits also included the financial statement schedule listed in the index at Item 15. An audit includes examining. on a test basis. in 2010 the Company adopted ASC Topic 605 with respect to accounting and reporting for revenue-generating arrangements with multiple deliverables. 2010 and 2009. 2010 and 2009. New Jersey February 23. shareholders’ equity (deficit). /s/ Iselin. We believe that our audits provide a reasonable basis for our opinion. presents fairly in all material respects the information set forth therein. and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).Report of Independent Registered Public Accounting Firm The Board of Directors and Shareholders of Global Crossing Limited We have audited the accompanying consolidated balance sheets of Global Crossing Limited and subsidiaries as of December 31. 2010. These financial statements and schedule are the responsibility of the Company’s management. the Company adopted ASC Topic 805 with respect to accounting for the reversal of pre-emergence valuation allowances. in all material respects. in accordance with the standards of the Public Company Accounting Oversight Board (United States). 2011 expressed an unqualified opinion thereon. In our opinion. in conformity with U. Global Crossing Limited’s internal control over financial reporting as of December 31. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. in our opinion. An audit also includes assessing the accounting principles used and significant estimates made by management. cash flows. when considered in relation to the basic financial statements taken as a whole. 2010. evidence supporting the amounts and disclosures in the financial statements. and the related consolidated statements of operations. the related financial statement schedule. the financial statements referred to above present fairly. the consolidated financial position of Global Crossing Limited and subsidiaries at December 31.

000 shares authorized. . . . . . . . . . . . . . . . . . . . Long term debt . . . . . Prepaid costs and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .310 $ 2. . . . . . . . . . . respectively . . . .000. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total current liabilities . . . . Total liabilities and shareholders’ deficit . . Intangible assets.766) (360) $ 2. Accumulated deficit . . . . .280 198 88 $ 2. . . . . . . . . . . . 2010 December 31. . . .216 .GLOBAL CROSSING LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in millions. . . . . . . . . . . . . . . . . . net of allowances of $45 and $50 . . . . . . LIABILITIES: Current liabilities: Accounts payable . . . Obligations under capital leases—current portion .787 $ 312 87 37 49 174 384 1. . . . Restricted cash and cash equivalents—current portion . . . . . . . .043 1. . . . . . . SHAREHOLDERS’ DEFICIT: Common stock. . . . . . . . . . . . . . . . 2010 and 2009. . . . . . . . . . .514 and $1. . . . . . . . . . .310 2 1. . . . . . . . . . . . Accounts receivable. . . . . . . . . . . . . . . . . . . . . $. . . . . . . . . . . . . . . . . . . . . . . . . .709 and 60. .10 par value. . . Short term debt and current portion of long term debt . . . . . . . . . . . . . . . . Total assets . . . . . .000 shares authorized. . . Other deferred liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .488 The accompanying notes are an integral part of these consolidated financial statements. . . . Total current assets . . . . . . . . . .295 90 334 86 2. . . . . . . . . . $. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other assets . 60. . . . 110. . $ 372 4 324 91 791 5 1. . . . . . . . . . . . . . . . . . . . 18. . . . . . . . .01 par value. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net of accumulated depreciation of $1. . . . . . . . . . F-3 . . . . . . . . . . . . . . . . 45. . . . .848 1 1 2 1. . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred revenue—current portion . . . . . . . . . . . . . . . . . . . except share and per share information) December 31. . . . . . . . . .179 227 108 $ 477 9 328 101 915 7 1. . . . . . . . . . . . . net (including goodwill of $208 and $175) . . . . . . . . . . . . . . . . . . . . . . .000.443 15 (1. . . . . . . . . . . . . . . . . . . . . Obligations under capital leases . . . . Accrued cost of access . . . . . . . . . . . . . .497. . . . . . .817 shares issued and outstanding as of December 31. . Preferred stock with controlling shareholder. . . . . . . . . . . . . Property and equipment. . . . .000 shares issued and outstanding . . . . . . . . . . . . . . . . Accumulated other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .488 $ 297 78 27 51 184 376 1. . . . . . . . . . . . . . . . . . . . . . . Total liabilities . . . . Total shareholders’ deficit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Restricted cash and cash equivalents—long term . . . . . . .311 72 338 53 2. . . . . . . . . . . . . . . . . .938) (477) $ 2. . . . . . . . . . . . . . . . . . . Deferred revenue . . . . . . . . . . . . . . . . . 2009 ASSETS: Current assets: Cash and cash equivalents .000. .013 1. .427 (24) (1. . .219. . . . . . .

GLOBAL CROSSING LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except share and per share information)
2010 Year Ended December 31, 2009 2008

Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ Cost of revenue (excluding depreciation and amortization, shown separately below): Cost of access . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Real estate, network and operations . . . . . . . . . . . . . . . . . . . . . . Third party maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of equipment and other sales . . . . . . . . . . . . . . . . . . . . . . . Total cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gross margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other income (expense): Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other income (expense), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loss before pre-confirmation contingencies and benefit (provision) for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net gain on pre-confirmation contingencies . . . . . . . . . . . . . . . . Loss before benefit (provision) for income taxes . . . . . . . . . . . . . . . . Benefit (provision) for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loss applicable to common shareholders . . . . . . . . . . . . . . . . . . . . . . Loss per common share, basic and diluted: Loss applicable to common shareholders . . . . . . . . . . . . . . . . . . Weighted average number of common shares . . . . . . . . . . . . . . $ $

2,609

$

2,536

$

2,599

(1,159) (408) (104) (107) (1,778) 831 (431) (337) 63 2 (191) (51) (177) — (177) 5 (172) (4) (176) $ (2.91) $ 60,418,995

(1,159) (406) (103) (98) (1,766) 770 (428) (340) 2 7 (160) 11 (140) — (140) (1) (141) (4) (145) $ (2.45) $ 59,290,355

(1,211) (423) (107) (94) (1,835) 764 (491) (326) (53) 10 (176) (26) (245) 10 (235) (49) (284) (4) (288) (5.16) 55,771,867

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

F-4

GLOBAL CROSSING LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT) (in millions, except share information)
Common Stock Preferred Stock Other Shareholders’ Equity (Deficit) Total Shareholders’ Equity (Deficit) Accumulated Additional Other Paid-in Comprehensive Accumulated Amount Capital Income (Loss) Deficit

Shares

Amount

Shares

Balance at December 31, 2007 . . . . . . . 54,552,045 Realization of pre-emergence valuation allowances . . . . . . . . . — Issuance of common stock from exercise of stock options . . . . . . 123,071 Issuance of common stock from vested stock units . . . . . . . . . . . 2,210,508 Common stock withheld for employee taxes from vested stock units . . . . . . . . . . . . . . . . . (189,312) Preferred stock dividends ($0.22 per preferred share) . . . . . . . . . . — Foreign currency translation adjustment . . . . . . . . . . . . . . . . . — Stock compensation expense of awards classified as equity . . . . — Unrealized derivative gain on cash flow hedge . . . . . . . . . . . . . . . . . — Change in pension liability . . . . . . — Net loss . . . . . . . . . . . . . . . . . . . . . — Balance at December 31, 2008 . . . . . . . 56,696,312 Issuance of common stock from exercise of stock options . . . . . . 14,666 Issuance of common stock from vested stock units . . . . . . . . . . . 5,244,369 Common stock withheld for employee taxes from vested stock units . . . . . . . . . . . . . . . . . (1,735,530) Preferred stock dividends ($0.22 per preferred share) . . . . . . . . . . — Foreign currency translation adjustment . . . . . . . . . . . . . . . . . — Stock compensation expense of awards classified as equity . . . . — Stock compensation reclass from liability to equity . . . . . . . . . . . . — Unrealized derivative loss on cash flow hedge . . . . . . . . . . . . . . . . . — Change in pension liability . . . . . . — Net loss . . . . . . . . . . . . . . . . . . . . . — Balance at December 31, 2009 . . . . . . . 60,219,817 Issuance of common stock from exercise of stock options . . . . . . 50,000 Issuance of common stock from vested stock units . . . . . . . . . . . 278,696 Common stock withheld for employee taxes from vested stock units . . . . . . . . . . . . . . . . . (50,804) Preferred stock dividends ($0.22 per preferred share) . . . . . . . . . . — Foreign currency translation adjustment . . . . . . . . . . . . . . . . . — Stock compensation expense of awards classified as equity . . . . — Change in pension liability . . . . . . — Net loss . . . . . . . . . . . . . . . . . . . . . — Balance at December 31, 2010 . . . . . . . 60,497,709

$ 1 — — — — — — — — — — $ 1 — — — — — — — — — — $ 1 — — — — — — — — $ 1

18,000,000 — — — — — — — — — — 18,000,000 — — — — — — — — — — 18,000,000 — — — — — — — — 18,000,000

$ 2 — — — — — — — — — — $ 2 — — — — — — — — — — $ 2 — — — — — — — — $ 2

$1,345 30 1 1 (3) (4) — 29 — — — $1,399 — — (13) (4) — 18 27 — — — $1,427 1 — (1) (4) — 20 — — $1,443

$(42) — — — — — 21 — 9 (11) — $(23) — — — — (4) — — (4) 7 — $(24) — — — — 30 — 9 — $ 15

$(1,341) — — — — — — — — — (284) $(1,625) — — — — — — — — — (141) $(1,766) — — — — — — — (172) $(1,938)

$ (35) 30 1 1 (3) (4) 21 29 9 (11) (284) $(246) — — (13) (4) (4) 18 27 (4) 7 (141) $(360) 1 — (1) (4) 30 20 9 (172) $(477)

The accompanying notes are an integral part of these consolidated financial statements. F-5

GLOBAL CROSSING LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions)
2010 Year Ended December 31, 2009 2008

Cash flows provided by (used in) operating activities: Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Adjustments to reconcile net loss to net cash used in operating activities: Gain on sale of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loss on sale of marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-cash loss on extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-cash income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-cash stock compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Amortization of prior period IRUs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred reorganization costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gain on pre-confirmation contingencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . Change in long term deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Change in operating working capital: —Changes in accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . —Changes in accounts payable and accrued cost of access . . . . . . . . . —Changes in other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —Changes in other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cash flows provided by (used in) investing activities: Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchases of marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Genesis acquisition, net of cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . Proceeds from sale of property and equipment . . . . . . . . . . . . . . . . . . . . . . . Proceeds from sale of marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . Change in restricted cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cash flows provided by (used in) financing activities: Proceeds from short and long term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repayment of capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repayment of long term debt (including current portion) . . . . . . . . . . . . . . Premium paid on extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . Finance costs incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proceeds from sales/leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proceeds from exercise of stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . Payment of employee taxes on share-based compensation . . . . . . . . . . . . . Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . Cash and cash equivalents, beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cash and cash equivalents, end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (172) (1) 2 5 — (23) 20 337 3 (25) — — 33 54 (2) (32) 3 (19) 183 (167) (10) (7) — 8 8 (168) 150 (58) (179) (2) (6) — 1 (1) (95) (25) (105) 477 $ 372

$ (141) — — 15 — (20) 18 340 7 (22) (3) — 42 (28) 17 (36) (16) 83 256 (174) — — — 4 2 (168) 741 (75) (597) (14) (23) 7 — (13) 26 3 117 360 $ 477

$ (284) (4) 2 — 35 (1) 55 326 6 (15) (3) (10) 83 45 (25) 49 (52) (4) 203 (192) (11) — 10 16 31 (146) 10 (59) (24) — — — 1 (3) (75) (19) (37) 397 $ 360

The accompanying notes are an integral part of these consolidated financial statements. F-6

GLOBAL CROSSING LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (in millions)
2010 Year Ended December 31, 2009 2008

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . Unrealized derivative gain (loss) on cash flow hedges . . . . . . . . . . Change in pension liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (172) 30 — 9 $ (133)

$ (141) (4) (4) 7 $ (142)

$ (284) 21 9 (11) $ (265)

The accompanying notes are an integral part of these consolidated financial statements. F-7

Europe. The estimates the Company makes are based on historical factors. and the reported amounts of revenue and expenses and cash flows during the periods presented. percentage. voice and collaboration services and delivers service to approximately 40 percent of the companies in the Fortune 500.) Telecommunications Ltd (“GCUK”) and its subsidiaries (collectively. except when control is not held by the majority owner. Actual amounts and results could differ from those estimates. the accompanying consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the Company’s results as of and for the years ended December 31. GCL and its subsidiaries (collectively. and has 17 data centers located in major business centers.S. the “GCUK Segment”). mobile operators and Internet service providers around the world. The Company’s operations are based principally in North America. The Company offers a full range of data. and (iii) GCL and its other subsidiaries (collectively. share and per share information) 1. F-8 . GAAP in this Annual Report are to the Financial Accounting Standards Board (“FASB”) Accounting Standards CodificationTM . GAAP. current circumstances and the experience and judgment of the Company’s management. (ii) GC Impsat Holdings I Plc (“GC Impsat”) and its subsidiaries (collectively. References to U.K. These consolidated financial statements include the accounts of GCL and its subsidiaries over which it exercises control.GLOBAL CROSSING LIMITED AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in millions.S. the disclosure of contingent assets and liabilities in the consolidated financial statements and the accompanying notes. as well as 700 carriers. the “Rest of World Segment” or “ROW Segment”) (see Note 21). The Company evaluates its assumptions and estimates on an ongoing basis and may employ outside experts to assist in the Company’s evaluations. except countries. Latin America and a portion of the Asia/Pacific region. The Company delivers converged IP services to more than 700 cities in more than 70 countries. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated financial statements. The Company reports financial results based on three separate operating segments: (i) Global Crossing (U. 2009 and 2008. BACKGROUND AND ORGANIZATION Global Crossing Limited or “GCL” is a holding company with all of its revenue generated by its subsidiaries and substantially all of its assets owned by its subsidiaries. the “Company”) are a global communications service provider. carriers. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES A summary of the basis of presentation and the significant accounting policies followed in the preparation of these consolidated financial statements is as follows: Basis of Presentation and Use of Estimates The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U. 2010. the “GC Impsat Segment”). GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of management.S. (the “Codification” or “ASC”). Under U. Principles of Consolidation The consolidated financial statements include the accounts of GCL and its wholly-owned subsidiaries. consolidation is generally required for investments of more than 50% of the outstanding voting stock of an investee.S. All significant intercompany accounts and transactions have been eliminated in consolidation. 2. The preparation of consolidated financial statements in conformity with U. The vast majority of the Company’s revenue is generated from monthly services. cities.

Revenue-Generating Arrangements with Multiple Deliverables See “Recently Issued and Recently Adopted Accounting Pronouncements” for a description of the Company’s policy for revenue-generating arrangements with multiple deliverables. Non-refundable payments received from customers on billings made before the relevant criteria for revenue recognition are satisfied are included in deferred revenue in the accompanying consolidated balance sheets. the actual contract term is used. Where the Company acts as the principal in the transaction and has the risks and rewards of ownership. as amended by SEC Staff Accounting Bulletin 104. F-9 . the Company generally amortizes revenue related to installation services on a straight-line basis over the average contracted customer relationship (generally 24 months). Additionally. These taxes may include. In situations where the contracted period is significantly longer than the average. Revenue Recognition Services Revenue derived from telecommunication and maintenance services.Reclassifications Certain amounts in prior period consolidated financial statements and accompanying footnotes have been reclassified to conform to the current year presentation. the Company treats non-refundable cash received prior to the completion of the earnings process as deferred revenue in the accompanying consolidated balance sheets. the actual contract term is used. U. including sales of capacity under operating-type leases. “Revenue Recognition” (“SAB No. In addition. The Company’s policy is generally to record these taxes on a net basis. Telecom Installation Revenue and Costs In accordance with SEC Staff Accounting Bulletin 101. Operating Leases The Company offers customers flexible bandwidth products to multiple destinations for stipulated periods of time and many of the Company’s contracts for subsea circuits are entered into as part of a service offering. Gross vs. In the event the Company does not act as a principal in the transaction. the Company defers revenue related to those circuits and amortizes the revenue over the appropriate term of the contract. but are not limited to. Accordingly. Consequently. In situations where the contracted period is significantly longer. if such taxes are significant. The costs are capitalized to deferred installation costs (current portion and long-term portions—see Note 6) and amortized using the straightline method into depreciation and amortization over the average contracted relationship (generally 24 months). transactions are recorded gross in the consolidated statements of operations. are recognized as services are provided. sales. the amounts of those taxes should be disclosed. use. GAAP requires that companies disclose their accounting policy regarding the gross or net presentation of taxes which are assessed by a governmental authority that are directly imposed on revenueproducing transactions between sellers and customers.S. Net Revenue Recognition In the vast majority of transactions the Company acts as the principal party responsible for delivering services to customers. and are presented on a gross basis. The Company capitalizes installation costs incurred for new facilities and connections from the Global Crossing network to networks of other carriers in order to provision customer orders. 101”). transactions are recorded on a net basis in the consolidated statements of operations. value-added and some excise taxes. 104”). “Revenue Recognition in Financial Statements” (“SAB No.

evaluating the trend of invoiced amounts by vendors. which approximates fair value. The recognition of cost of access expense during any reported period involves the use of significant management estimates and requires reliance on non-financial systems given that bills from access vendors are generally received significantly in arrears of service being provided. automobiles. Restricted Cash and Cash Equivalents (Current and Long-Term) The Company considers cash in banks and short-term highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. utilities and maintenance. If the Company believes that it has been billed inaccurately. to renewal options and provide for the payment of taxes. comparing billed rates with rates used by the cost of access expense estimation systems during the cost of access monthly close process. Rent-free periods and other incentives granted under certain leases are charged to rent expense on a straight-line basis over the related terms of such leases. Operating Leases The Company maintains commitments for office and equipment space. See Note 19 for the Company’s estimated future minimum lease payments and rental expense on operating leases.Operating Expenses Cost of Access The Company’s cost of access primarily comprises charges for leased lines for dedicated facilities and usage-based voice charges paid to local exchange carriers and interexchange carriers to originate and/or terminate switched voice traffic. The Company recognizes rent expense on a straight-line basis and records a liability representing the rent expensed but not invoiced in other deferred liabilities. under various non-cancelable operating leases. F-10 . Disputes The Company and contracted third parties perform monthly bill verification procedures to identify errors in vendors’ billing processes. equipment rentals. The bill verification procedures include the examination of bills. are subject. network capacity contracts and other leases. The lease agreements. adjusted for contracted rate changes. If the Company ultimately reaches an agreement with an access vendor to settle a disputed amount which is different than the corresponding accrual. Leased line access costs are estimated based on the number of circuits and the average circuit cost. Cash and Cash Equivalents. the estimated costs are adjusted to reflect actual expenses incurred. The Company records a charge to the cost of access expense and a corresponding increase to the access accrual based on the last eighteen months of historical loss rates for the particular type of dispute. and reviewing the types of charges being assessed. The Company’s policy is to record access expense as services are provided by vendors. in many cases. it will dispute the charge with the vendor and begin resolution procedures. multiplied by the estimated rates for those minutes for that month. Any leasehold improvements related to operating leases are amortized over the lesser of their economic lives or the remaining lease term. Cash and cash equivalents and restricted cash and cash equivalents are stated at cost. which expire at various dates into the future. the Company recognizes the difference in the period in which the settlement is reached as an adjustment to cost of access expense. Certain lease agreements contain escalation clauses over the term of the lease related to scheduled rent increases resulting from the pass through of increases in operating costs. according to the Company’s leased line inventory system. property taxes and the effect on costs from changes in consumer price indices. Upon final receipt of invoices. Restricted cash and cash equivalents comprise cash collateral for letters of credit or performance bonds issued in favor of certain of the Company’s vendors and deposits securing real estate obligations. Switched voice traffic costs are accrued based on the minutes recorded by the Company’s switches.

.Allowance for Doubtful Accounts and Sales Credits The Company provides allowances for doubtful accounts and sales credits. . . . . . . . . . Leasehold improvements . and were not based on prices that may have been available through equipment purchases from financially distressed communications companies. . . . . . . a market approach. . . . . Under the replacement cost approach. . A general reserve requirement is performed on accounts not already included under the specific reserve requirement utilizing past loss experience and the factors previously mentioned. Estimated useful lives of the Company’s property and equipment are as follows as of December 31. Major enhancements are capitalized. . . . Purchases of property and equipment. including discussions with equipment brokers and dealers. . available to the Company at the Effective Date for technology available at the time. . . . fair value was determined by comparing recent sales of similar assets and adjusting for factors such as physical differences. net. . net Property and equipment. . . . . fair value was determined by examining an asset’s replacement cost and adjusting for loss in value due to physical depreciation and economic and functional obsolescence. The Company determined the fair value of its property and equipment as of the Effective Date by using a replacement cost approach and. . A specific reserve requirement review is performed on customer accounts with larger aged balances. . . . . . Transmission equipment . . . . . while expenditures for repairs and maintenance are expensed when incurred. . . . 2003 (the (“Effective Date”) as determined by the Company’s reorganization value. . . Under the market approach. Direct internal costs of constructing or installing property and equipment are capitalized. Such changes in estimates are recorded in the period in which these changes become known. . the market approach was used. inclusive of discounts. . the customer’s payment history. . . . . . Changes in the financial viability of significant customers and worsening of economic conditions may require changes to its estimate of the recoverability of the receivables. . . . . Furniture. . and current industry trends. otherwise the term of the lease. . . . which includes amounts under capitalized leases. . . . . . For assets where actual vendor pricing information as of the Effective Date was not available to the Company. . Allowances for doubtful accounts are charged to selling. . . . . . 10-40 years Lesser of 20 years or remaining lease term 3-7 years 3-25 years F-11 . . . . . . . . fixtures and equipment . . . and administrative expenses. 2010: Buildings . . while allowances for sales credits are charged to revenue. . . . . net. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. . were stated at their estimated fair values upon emergence from reorganization proceedings on December 9. . . The estimates were based on market comparables obtained from various sources. . . . age. general. . . . . . . . . . . . the current economic climate. . which are depreciated over their estimated useful lives if the lease transfers ownership or contains a bargain purchase option. . . . The adequacy of the reserves is evaluated monthly by the Company utilizing several factors including the length of time the receivables are past due. with the exception of leasehold improvements and assets acquired through capital leases. Service level requirements are assessed to determine sales credit requirements where necessary. . and economic and functional obsolescence. . . changes in the customer’s credit worthiness. . net of depreciation and amortization. . . including amounts under capital leases. Property and Equipment. . . The replacement cost estimates were based on vendor pricing. . which is included in property and equipment and is depreciated starting on the date the project is complete. subsequent to the Effective Date are stated at cost. . . . . . . in the limited circumstances described below. . . Costs incurred prior to the capital project’s completion are reflected as construction in progress. . . . the length of the customer’s relationship with the Company.

The results of the reviews indicate that no impairment exists. Goodwill and intangibles with indefinite lives are not amortized but are reviewed for impairment at least annually (beginning with the first anniversary of the acquisition date). along with certain other costs associated with approved restructuring plans (see Note 3). 2002 were recorded upon management’s commitment to an exit plan. The Company has applied the relevant accounting provisions for exit costs to all restructuring programs initiated after December 31. 2010. net. 2010 and 2009 consolidated balance sheets. Restructuring programs initiated after December 31. which was generally before the exit activity had occurred. Restructuring The components of the restructuring liability represent the fair value of direct costs of exiting lease commitments for certain real estate facility locations and employee termination costs. customer relationships and internally developed software and goodwill related to the 2006. (“Genesis Networks”). The Company annually evaluates the recoverability of its long-lived assets and evaluates such assets for impairment whenever events or circumstances indicate that the carrying amount of such assets (or group of assets) may not be recoverable. Software maintenance and training costs are expensed in the period in which they are incurred. Impsat and Genesis Networks Inc.When property or equipment is retired and disposed of. 2002 except for those programs related to business acquisitions. The results of the test indicate that no impairment of the Company’s long-lived assets existed as of December 31. Impairment is determined to exist if the estimated future undiscounted cash flows are less than the carrying value of such asset. Subsequent additions. Internally Developed Software The Company capitalizes the cost of developing internal-use software which has a useful life in excess of one year. the cost and accumulated depreciation is relieved from the accounts. The Company performed annual impairment reviews of the goodwill acquired as part of the Fibernet and Impsat acquisitions during the year ended December 31. during 2010 management performed a recoverability test of our long-lived assets as of December 31. 2007 and 2010 acquisitions of Fibernet Group Plc (“Fibernet”). 2010. Debt financing costs are amortized to interest expense over the lesser of the term or the expected payment date of the debt obligation using the effective interest rate method. 2008 F-12 . Capitalized costs are included in property and equipment in the consolidated balance sheet. As a result of a history of operating losses and negative cash flows. respectively. Intangibles Intangibles consist primarily of customer contracts. Capitalized software costs are amortized using the straight-line method over a 5 year period (see Note 7). and resulting gains or losses are reflected in other income (expense). Deferred Financing Costs Costs incurred to obtain financing through the issuance of debt and other financing agreements (see Note 10) have been reflected as an asset included in “other assets” in the accompanying December 31. The fair values attributable to the identified intangibles as of the acquisition dates were based on a number of significant assumptions as determined by the Company. Restructuring programs related to business acquisitions consummated prior to December 31. Restructuring programs initiated prior to December 31. 2010. modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. The amount of any recognizable impairment would be determined as the difference between the fair value and the carrying value of the asset. Identifiable intangible assets with finite lives are amortized using the straight-line method over their applicable estimated useful lives (see Note 8). 2002 were recorded when a liability had been incurred.

Changes in the fair value of the effective portions of cash flow hedges are reported in other comprehensive income (loss) and recognized in income (loss) when the hedged item is recognized in income (loss). A valuation allowance is provided when the Company determines that it is more likely than not that a portion of the deferred tax asset balance will not be realized. especially as they relate to contractual lease commitments and related anticipated third-party sub-lease payments. as appropriate (see Note 18). Changes in fair value of derivative instruments that do not qualify as hedges and/or any ineffective portion of hedges are recognized as a gain or loss in the Company’s consolidated statement of operations in the current period. 2009. along with the change in the value of the hedged item. 2009 and 2008. approximate their fair value due to their short maturities. Asset Retirement Obligations The Company recognizes the fair value of a liability for an asset retirement obligation in the period in which it is incurred when a reasonable estimate of fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the long-lived asset. The Company’s reorganization has resulted in a significantly modified capital structure as a result of applying fresh-start accounting on the Effective Date. short-term investments. For business combinations completed on or after January 1. current interest rates. could have a material effect on the restructuring liabilities. circumstances and information available at the reporting date. or management estimates. Income Taxes The provision for income taxes. The fair value of marketable securities. including short-term and long-term portions and derivative instruments are based on market quotes. Adjustments for changes in assumptions are recorded in the period such changes become known. Changes in assumptions. hedge ineffectiveness was not material to our results of operations. Fresh-start accounting has important consequences on the F-13 . 2010. For the years ended December 31. income taxes payable and deferred income taxes are determined using the liability method. Derivative Instruments Derivatives are measured at fair value and recognized as either assets or liabilities in the Company’s consolidated balance sheets.were recorded as an acquired liability included in the allocation of acquisition cost. the costs related to restructuring programs are expensed as incurred.” “More likely than not” is defined as a likelihood of greater than 50% based on the facts. Fair Value of Financial Instruments The Company does not enter into financial instruments for trading or speculative purposes. characterized as leasehold improvements. debt. Changes in the fair values of the derivative instruments used effectively as fair value hedges are recognized in income (loss). and depreciated over the lesser of 20 years or the remaining lease term. other than marketable securities. The Company follows the guidance with respect to accounting for uncertainty in income taxes located in ASC Topic 740 which states that an “enterprise shall initially recognize the financial statement effects of a tax position where it is more likely than not. based on the technical merits. that the position will be sustained upon examination. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured by applying enacted tax rates and laws to taxable years in which such differences are expected to reverse. The carrying amounts of financial instruments classified as current assets and liabilities.

new accounting standards became effective which require the reversal of pre-emergence valuation allowances to be recorded as a reduction of tax expense. The Company recognizes the related compensation cost of such awards on a straight-line basis. Loss applicable to common shareholders includes preferred stock dividends for the years ended December 31. are geographically dispersed and include customers both large and small and in F-14 .accounting for the realization of valuation allowances. Certain stock-based awards have graded vesting (i. The impact of these revisions is recorded in income tax expense or benefit in the period in which they become known. related to net deferred tax assets that existed on the Effective Date but which arose in pre-emergence periods. These estimates and assumptions are revised as new events occur. which are unsecured. assets and liabilities are translated at exchange rates in effect at the balance sheet date and income and expense transactions are translated at average exchange rates during the period. $40. The Company’s foreign exchange transaction gains (losses) included in “other income (expense). respectively. Dollar as their functional currency. translation adjustments are recorded in the accompanying consolidated statements of operations. provided that the amount amortized at any given date may be no less than the portion of the award vested as of such date. For those subsidiaries not using the U. Loss Per Common Share Basic loss per common share (“EPS”) is computed as loss applicable to common shareholders divided by the weighted-average number of common shares outstanding for the period. amounts of permanent and temporary differences. Specifically. the likelihood of deferred tax assets being recovered and the outcome of contingent tax risks. and thereafter as additional paid in capital (see Note 13). Resulting translation adjustments are recorded directly to a separate component of shareholders’ deficit and are reflected in the accompanying consolidated statements of comprehensive loss. See Note 16 for a detailed description of stock-based compensation plans. 2009 and 2008 respectively (see Note 15). Stock-Based Compensation Share-based awards granted to employees are recognized as compensation expense over the service period (generally the vesting period) based on their fair values. This treatment does not result in any change in liabilities to taxing authorities or in cash flows. 2009 and 2008 were $(44). At each period end. On January 1. The fair value of the awards is determined using a single expected life for the entire award (the average expected life for the awards that vest on different dates). Concentration of Credit Risk The Company has some concentration of credit risk among its customer base. fresh start accounting requires the reversal of such allowances to be recorded as a reduction of intangible assets established on the Effective Date until exhausted. portions of the award vest at different dates during the vesting period). more experience is acquired and additional information is obtained.S. net” in the consolidated statements of operations for the years ended December 31. The Company’s trade receivables. and $(30). 2009. Foreign Currency Translation and Transactions For transactions that are in a currency other than the entity’s functional currency.e. 2010. it is necessary for the Company to make certain estimates and assumptions to compute the provision for income taxes including allocations of certain transactions to different tax jurisdictions. 2010.

The official rate is the rate used by the Comisión de Administración de Divisas (“CADIVI”). Dollars. The Company performs ongoing credit evaluations of its larger customers’ financial condition. This devaluation reduced the Company’s net monetary assets (including unrestricted cash and cash equivalents) by approximately $27 based on the bolivares balances as of such date. Dollar. Any such shortages or restrictions may limit or impede the Company’s ability to transfer or to convert such currencies into U. Dollar could adversely affect the Company’s ability to market its services to customers whose revenue is denominated in those currencies. the Venezuelan government announced that the unregulated parallel currency exchange market would be shut down and that the BCV would be given control over the previously unregulated portions of the exchange market. an agency of the Venezuelan government. respectively. resulting in a corresponding foreign exchange loss. Furthermore. no one customer accounted for more than 2% or 2%.S. historical trends and other relevant information. 2010 and 2009. based on the credit risk applicable to particular customers.60 for goods and services deemed “essential”. In June 2010. included in other expense. In either event. the Company’s operating results may suffer due to currency translations in the event that such currencies depreciate relative to the U. 2010.S. Dollars. 2010 and 2009.”) government together represented approximately 5% and 5%. As of December 31. the official bolivares—U. Dollars. The obligations of customers with revenue in foreign currencies may be subject to unpredictable and indeterminate increases in the event that such currencies depreciate in value relative to the U. Dollar and the Company cannot or does not elect to enter into currency hedging arrangements in respect of those payment obligations.S. the Company’s trade receivables related to the carrier sales channel represented approximately 42% and 43%.S. respectively.S. Trade receivables from the carrier sales channels are generated from sales of services to other carriers in the telecommunications industry. 2010 and 2009. Dollar exchange rate established by the Venezuelan Central Bank (“BCV”) and the Venezuelan Ministry of Finance has historically attributed to the bolivar a value significantly greater than the value that prevailed on the former unregulated parallel market. a new regulated currency trading system controlled by the BCV.numerous industries. the Company’s receivables due from various agencies of the United Kingdom (“U. The Company maintains a reserve for potential credit losses. the Transaction System for Foreign Currency Denominated Securities F-15 . of consolidated receivables. on May 18. Certain Latin American economies have experienced shortages in foreign currency reserves and have adopted restrictions on the use of certain mechanisms to expatriate local earnings and convert local currencies into U. where the Company issues invoices for its services in currencies other than U. Dollars.30 for goods and services deemed “nonessential” and 2. the Venezuelan government devalued the Venezuelan bolivar. currency devaluations in one country may have adverse effects in another country. respectively. of consolidated accounts receivable. net. In an attempt to control inflation. Dollars but are invoiced by the Company in U. liabilities and transactions of its Venezuelan subsidiary. to exchange bolivares pursuant to an official process that requires application and government approval. 2010.30 Venezuelan bolivares to the U.S. the affected customers may not be able to pay the Company in U. Also as of December 31. In addition. The official rate increased from 2.S. The Company uses the official rate to record the assets. of the Company’s consolidated receivables. Effective January 12. the Venezuela government further increased the official rate for goods and services deemed “essential” to 4. Effective January 1. In addition. 2011. Declines in the value of foreign currencies (such as the devaluation of the Venezuelan bolivar discussed below) relative to the U. At December 31. Dollar to 4. This change had no effect on the carrying value of the Company’s net monetary assets. In Venezuela.S. Dollars.K.15 Venezuelan bolivares to the U. net in the Company’s consolidated statement of operations for 2010.S.S. such customers may become subject to exchange control regulations restricting the conversion of their revenue currencies into U. Dollars and to expatriate such funds for the purpose of making timely payments of interest and principal on the Company’s indebtedness.S.S. Dollar.S. Currency Risk Certain of the Company’s current and prospective customers derive their revenue in currencies other than U.

Dollars. Dollars at both the essential and non-essential official rates. net in the Company’s consolidated statement of operations for 2010. At December 31.. which resulted in an approximate 27% discount. Dollar. The loss of $2 was included in other income (expense). The Company received approval to purchase the bonds and sold these bonds immediately upon receipt at a price of $8 paid in U. Dollar-denominated bonds at par value in connection with the Company’s currency exchange risk mitigation efforts. In light of the Venezuelan exchange control regime. the Company’s Venezuelan subsidiary contributed approximately $52 of the Company’s consolidated revenue and $30 of the Company’s consolidated OIBDA. Dollar at December 31. the Euro and the Brazilian Real. The Company received approval to purchase the bonds and sold these bonds immediately upon receipt at a price of $8. For 2010. which resulted in an approximate 25% discount. Dollar denominated securities through banks authorized by the BCV. advances or cash dividends without the consent of a third party (i.S. Dollar-denominated bonds in connection with the Company’s currency exchange risk mitigation efforts.S. As of December 31. 2010 (the “CADIVI rate”)) of the Company’s cash and cash equivalents was held in Venezuelan bolivares.30 bolivares to the U. the Company participated in a debt auction held by the Venezuelan government and used bolivares to purchase $10 of U. If the Company was to successfully avail itself of the SITME process to convert a portion of its Venezuelan subsidiary’s cash balances into U. Dollars and $33 were denominated in Venezuelan bolivares at the CADIVI rate. commenced operations and established an initial weighted average implicit exchange rate of approximately 5.S.(“SITME”). Some approvals have been issued within a few months while others have taken more than one year.S. the Company’s Venezuelan subsidiary had $70 of net assets.e. In 2010.S. approximately $37 (valued at the fixed official CADIVI rate of 4.S. The loss was included in other income (expense).S. liabilities and transactions. Dollar adversely impacts the Company’s consolidated revenue. Since the Company tends to incur costs in the same currency in which the Company realizes revenue. The Company conducts a significant portion of its business using the British Pound Sterling.S. As of December 31.30 Venezuelan bolivares to the U. To date. respectively. distribute dividends or otherwise expatriate capital using the official Venezuelan exchange rate. none of these net assets (other than the $4 of cash denominated in U. the Company had $14 of obligations registered and subject to approval by CADIVI for the conversion of bolivares into foreign currencies. In 2008. application and approval process. Dollars. the acquisition of foreign currency by Venezuelan companies to honor foreign debt. of approvals from CADIVI to convert bolivares to U. the conversion of bolivares into foreign currencies is limited by the current exchange control regime. pay dividends or otherwise expatriate capital is subject to either the limitations and restrictions of the SITME or the CADIVI registration. The purpose of the new regulated system is to supplement the CADIVI application and approval process with an additional process that allows for quicker and smaller exchanges.S.S. if the Company was to determine in the future that the SITME rate was the more appropriate rate to use to measure bolivar-based assets. the impact F-16 . 2010. the Company would incur currency exchange losses in the period of conversion based on the difference between the official exchange rate and the SITME rate. the Company participated in a debt auction held by the Venezuelan government to purchase $10 par value of U. net in the Company’s consolidated statements of operations. As of December 31. Additionally. During 2010 and 2009.S. Accordingly. the Company has not executed any exchanges through SITME. Subject to the limitations and restrictions imposed by the BCV. the Company received $9 and $7. The purchase price of the bonds was $11. 2010. As indicated above. These amounts do not include any allocated corporate overhead costs or transfer pricing adjustments. resulting in a significant buildup of excess cash in the Company’s Venezuelan subsidiary and a significant increase in the Company’s exchange rate and exchange control risks. the Company’s Venezuelan subsidiary had $37 of net monetary assets of which $4 were denominated in U. CADIVI or SITME). Appreciation of the U. in each case based on the CADIVI rate. 2010. The Company cannot predict the timing and extent of any CADIVI approvals to honor foreign debt. reported results would be further adversely affected. 2010. and is also subject to the availability of foreign currency within the guidelines set forth by the National Executive Power for the allocation of foreign currency. entities domiciled in Venezuela may access the SITME by buying U. Approvals under the CADIVI process have been less forthcoming at times. Dollars and held outside of Venezuela) may be transferred to GCL in the form of loans.

As such. The Company has elected to early adopt the new accounting guidance for revenue arrangements with multiple deliverables on a prospective basis as of January 1. The Company enters into managed service agreements with multiple deliverables.S. GAAP also requires an entity to recognize changes in the funded status within accumulated other comprehensive income. U. permitted. 2010. there was objective and reliable evidence of its fair value in the arrangement. and the impact of recognizing changes of the funded status of pension plans. When the fair value of all F-17 . net of tax to the extent such changes are not recognized in earnings as components of periodic net benefit cost (see Note 17). and delivery or performance of undelivered elements was considered probable and substantially under the Company’s control.S. entities must establish an estimated selling price for any units for which objective and reliable evidence of fair value or third party evidence of selling price is not determinable. Dollar value of cash balances held in those currencies. which is measured as the difference between the fair value of the plan assets and the benefit obligation. such as professional services as well as telecommunication services and solutions. Recently Issued and Recently Adopted Accounting Pronouncements In October 2009. and is included in selling. Pension Benefits The Company applies the guidance in ASC Topic 715 with respect to accounting for its defined benefit pension plans. Comprehensive Loss Comprehensive loss includes net loss and other non-owner related income (charges) in equity not included in net loss. 2010 and there was no significant impact to the Company’s consolidated financial results for the year ended December 31. 2009 and 2008. Advertising expense was $2. 2010. such as unrealized gains and losses on marketable securities classified as available for sale. which (a) amend the requirements entities must meet in order for elements to be considered separate units of accounting. with early adoption. a delivered element was considered a separate unit of accounting when it had value to the customer on a standalone basis. Under the relative selling price method for allocating consideration. which generally have minimum contract terms between two and seven years. Advertising Costs The Company expenses the cost of advertising as incurred. $2. changes in the unrealized gains and losses on cash flow hedges. respectively. 2010. as of the first fiscal year beginning after issuance of the amendments. ASC Topic 605 expands the qualitative and (if adoption impacts are significant) quantitative information required to be disclosed concerning revenue-generating arrangements with multiple deliverables.on operating income and operating cash flow is largely mitigated.S. the FASB issued amendments to ASC Topic 605. foreign currency translation adjustments related to foreign subsidiaries. general and administrative expenses as reported in the consolidated statements of operations. the Company recognizes in its statement of financial condition the funded status of its defined benefit postretirement plans. Dollar relative to foreign currencies reduces the U. and (c) replace the residual method of allocating consideration with the relative selling price method. Until the adoption of new guidance. In addition. (b) eliminate the requirement that entities have objective and reliable evidence of fair value for undelivered items in order to separate them from other elements in the arrangements. and $5 for the years ended December 31. Professional services are generally delivered during initial stages of contracts and telecommunication services over the contract term. the appreciation of the U. It may be adopted prospectively to all new or significantly modified arrangements or retrospectively to all arrangements. with respect to accounting and reporting guidance for revenue-generating arrangements with multiple deliverables. This amended accounting guidance is effective for fiscal years beginning after June 15.

the remaining liability of the 2007 restructuring plan including accrued interest was $3 and $7. the Company settled another claim initiated in November 2007 by a former officer of Impsat which was fully paid in April 2010. respectively. as well as its efforts to restructure while under Chapter 11 bankruptcy protection. Upon adoption of the amended guidance for multiple element arrangements. The Company does not expect a significant impact on the pattern and timing of revenue recognition in the financial statements of future periods. revenue from such arrangements was recognized when performance of the deliverable had occurred and all other revenue recognition criteria were met. In July 2009. the Company eliminated employees and vacated facilities. The liabilities associated with this restructuring plan have been accounted for as part of the purchase price of Impsat. Below is a description of the Company’s significant restructuring plans: 2007 Restructuring Plan During 2007. The Company establishes vendor specific objective evidence using the price charged for a deliverable when sold separately or using the price established by management having the relevant authority. Otherwise. 2010). representing $48 from subleases already entered into and $16 from subleases projected to be entered into in the future. is composed of continuing building lease obligations and broker commissions for the restructured sites (aggregating $73 as of December 31.elements could be determined. 2003 and Prior Restructuring Plans Prior to the Company’s emergence from bankruptcy on December 9. As of December 31. 2010 and 2009. will be paid through 2025. In all cases. As a result of these activities. As of December 31. The undiscounted facilities closing reserve. the residual value method would be used to allocate consideration to the combined undelivered elements. 2010 and 2009. anticipated third party sublease receipts were $64. In February 2010. such as margin objectives and pricing practices. the Company allocated consideration to each undelivered unit of accounting using the relative fair value method. RESTRUCTURING At December 31. The best estimate of selling price is established considering internal factors. All amounts incurred for employee separations were paid as of December 31. the Company determines an estimated selling price for any elements for which objective and reliable evidence or third party evidence is not available and then allocate consideration to all elements using the relative selling price method. F-18 . the Company settled one claim initiated in October 2007 by a former director and officer of Impsat to be paid out in installments through February 2011. 2010. There was no substantial change to the units of accounting the Company typically identifies in such multiple deliverable agreements. restructuring liabilities are included in other current liabilities and other deferred liabilities in our consolidated balance sheets. the Company adopted a restructuring plan as a result of the Impsat acquisition under which redundant Impsat employees were terminated. which represents estimated future cash flows. all of which relates to facility closings. 2003. all related to the GC Impsat Segment. Revenue from these arrangements is recognized when performance of the deliverable occurs and all other revenue recognition criteria are met. 3. with unit values determined by internal or third-party analyses of market based prices. which would be deferred until final arrangement performance. the Company incurred cash restructuring costs of approximately $8 for severance and related benefits. 2004 and it is anticipated that the remainder of the restructuring liability. the Company adopted certain restructuring plans as a result of the slowdown of the economy and telecommunications industry. offset by anticipated receipts from existing and future third-party subleases. As a result.

. . . . . . . Approximately $14 of short term and long term debt was subsequently repaid. . . . . . . . . Deductions . . 2010. . . . . . . . . . . The Company paid a purchase price for Genesis Networks of approximately $8 and repaid a portion of the debt and other liabilities assumed as part of the acquisition for total consideration including direct costs of $27. . . . . . . . Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Goodwill . $ 6 7 29 42 14 19 1 34 $ 8 All of the goodwill and all other amounts noted above are recorded in the ROW Segment. . . . the Company acquired 100% of the capital stock of Genesis Networks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009 . . . . . 4. . . . . . F-19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The following table summarizes the preliminary allocation of the acquisition cost to the assets acquired and liabilities assumed at the date of acquisition. . . . . . . . . Other liabilities . . . . . . . . . . 2009 . 2010 . . . . . . . . . . . . . . . . . . . . . . . . Total liabilities assumed . . . . . . 2010. . Deductions . . . . . Other current liabilities . . . . . . . . . . . . . . . . . . . Change in estimated liability . . . . . . . . . . . . . . . . . . . . . Genesis Networks provided approximately $4 of the Company’s consolidated revenue and $(1) of our consolidated net loss for the year ended December 31. . . . . . . . . . . . . . . . . . Foreign currency impact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The acquisition of Genesis Networks will enable us to provide value-added solutions to address specialized video transmission requirements across multiple industries. . . . . . . 2010 Other current assets . . . . . . . . . . . . 2010 and 2009: Facility Closings Balance at January 1. . . . . . . . The Genesis Networks network connects 70 cities on five continents and links important international media centers through 225 on-net points. . . . . . . . . . . . . a privately held company providing high performance rich media and video-based applications. . . . . . . . . . . . . . . . . . . . . . . . The results of Genesis Networks’ operations are included in the Company’s consolidated financial statements commencing on October 29. . . . . . . . . including capital lease obligations . . . . . . . . . . . . . . . . Since the date of its acquisition on October 29. . . . . 2010. . . . . . . . Balance at December 31. . . . . . . . . . . . serving many of the world’s major broadcasters. . . . . . . . . . . . . . . . . . . . . 2010. . . . . . . . . . . . . . . . Balance at December 31. . . None of the goodwill is deductible for tax purposes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total assets acquired . . . . Short and long term debt. . . . . . . . . . . . . . . . . . . . . . . . .The table below reflects the activity associated with the restructuring reserve relating to the restructuring plans initiated during and prior to 2003 for the years ended December 31. . . . . . . . . . . . . . . . . . Foreign currency impact . . . . . . . . . . . . . . . . . . . based on their preliminary estimated fair values: At October 29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . producers and aggregators of specialized programming. . . . . . . . . . . . . . . . . . . . Net assets acquired . . . . . . . . . . . . . . . . . . ACQUISITIONS Genesis Networks Acquisition $ 18 6 (8) 1 $ 17 (6) (1) $ 10 On October 29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . 5. . . . . . . (ii) a $27 foreign exchange loss as a result of the devaluation of the Venezuelan bolivar which is included in other income (expense). . . . . Allowances . . . . . . . .K. . . . . . . .632 $ (184) $ (3. 2010 are the following significant items: (i) a $6 property tax refund recorded in the U. . . net of allowances . . . . . . . . . . . . . . . Total accounts receivable . . . . . . network and operations in the accompanying consolidated statements of operations. . . . Accounts receivable. net in the accompanying consolidated statements of operations (see Note 2). . . . . . . . . . . nor should it be taken as indicative of the Company’s future consolidated results of operations. . . . . . (iv) a $29 loss on the early extinguishment of the GC Impsat Notes and the Senior Secured Term Loans which is included in other income (expense). .05) $2. . . . . . . . . . . . . . . . . . . net in the accompanying consolidated statements of operations (see Note 10). . . . . . . . . . . . . . 2010 2009 Revenue . in our GCUK and ROW Segments) which is included in real estate. . . (iii) a $5 retroactive property tax assessment ($3 and $2. . . . . . which is included in access charges in the accompanying consolidated statements of operations. . network and operations in the accompanying consolidated statements of operations. net in the accompanying consolidated statements of operations (see Note 10). . . . . . . . . . . The unaudited pro forma financial information is not intended to represent or be indicative of the Company’s consolidated result of operations that would have been reported had the Genesis Networks acquisition been completed as of the beginning of the periods presented. . . . . . Unbilled . . . . . . . . . . . . 2009: Year Ended December 31. . . . respectively. . . . . . . . . .562 $ (162) $ (2. . . . . . . . . . . . . . . Net loss applicable to common shareholders(1) . . .73) Net loss applicable to common shareholders was adjusted to exclude $4 of acquisition-related costs incurred in 2010 while net loss applicable to common shareholders in 2009 was adjusted to include these costs. . . . . . . . . . . . .Pro Forma Financial Information The following unaudited pro forma consolidated results of operations have been prepared as if the acquisition of Genesis Networks had occurred at January 1. . . . . . . . . . . . . . . . . . . . . . .K. . . . (iii) a $6 loss on the early extinguishment of the 5% Convertible Notes which is included in other income (expense). . (ii) a $6 favorable regulatory ruling related to a reduction in access charges in the U. . . . . . . . . 2010 2009 Accounts receivable: Billed . . . . F-20 $ 315 54 369 (45) $ 324 $ 318 60 378 (50) $ 328 . . . . . . . . . . . and (v) a reduction in our valuation allowance against our deferred tax assets by $20 which is recorded in provision for income taxes in the accompanying consolidated statements of operations (see Note 13). . . . . . . Included in the pro forma consolidated results of operations for the year ended December 31. . . . . . . . . . . . . . . . which is included in real estate. . . . . . and (v) $6 of revenue for the completion of a customer contract and a $7 equipment sale related to a new managed services contract. . . . . . . . . . . . . . . Included in the pro forma consolidated results of operations for the year ended December 31. . . . . . . . . . . . . . ACCOUNTS RECEIVABLE Accounts receivable consist of the following: December 31. . . . . . . . . . . . 2009 are the following significant items: (i) $13 for one customer’s buyout of certain long term obligations which is included in revenue in the accompanying consolidated statements of operations. . . . . . . . . . (iv) a reduction in our valuation allowance against our deferred tax assets by $34 which is recorded in provision for income taxes in the accompanying consolidated statements of operations (see Note 13). . . . . . . . . . Net loss applicable to common shareholders per common share—basic and diluted (1) $2. . . . . . .

. . . . . . . 2010 2009 Prepaid taxes. . . . . . . . . . Buildings . . . . . .257 30 $ 23 118 71 167 2. . . . .496 (1. . . . . . . . . . . . . . . . . . . .280 Assets recorded under capital lease agreements included in property and equipment consisted of $225 and $221 of cost less accumulated depreciation of $115 and $100 at December 31. . . . . . . . . . . . . . . . . . . . . . . . . . 2010 and 2009. . . . . . F-21 . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization expense related to property and equipment including cost of access installation costs (see Note 2) for the years ended December 31. . . . . . . . . . . . respectively. . . . . . . Total prepaid costs and other current assets . . . . . . . . . . . . . fixtures and equipment . Transmission equipment . . . . . . . . . . . respectively. Prepaid capacity. .179 $ 2. . . . Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 Land . . . . . . . . . . . . . . . including value added taxes in foreign jurisdictions . . . including assets held under capital leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . Furniture. . third party maintenance and deferred installation costs . . . . . . . . . . . . . .The fair value of accounts receivable balances approximates their carrying value because of their short-term nature. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24 17 8 9 33 $ 91 $ 37 19 8 13 24 $ 101 7. . . . . . . . .693 (1. . . . . . . . . . . . . . Prepaid rent and insurance . . . . 2010 and 2009. . .070 47 $ 2. . 2010. . . . . . respectively. . .216) $ 1. . . . . . Property and equipment. . . . . . . . respectively. . . . . . . . . . . . . . . . . . The accumulated depreciation related to this internal labor was $13 and $7 at December 31. . . . . . . The Company has some concentrations of credit risk from other telecommunications providers within its carrier sales channels (see Note 2). . . . . . Labor related to internally developed software in the amount of $40 and $32 was capitalized at December 31. . . . . . . . . . . . . . . . . . . . . . . Leasehold improvements . . . . . . . . . . . . . Other . . . . . . . . . . . . . Income tax receivable . . . . . . . . . . consist of the following: December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 and 2009. . . . . . . . . . . Construction in progress . . . . . . . . . . . . . . PROPERTY AND EQUIPMENT Property and equipment. . . . . . . . . . . . . . 6. . . . . . . . . . . . . . . . . . . . . . .514) $ 1. . . . . . . . . . . . . . . . $ 23 121 72 190 2. . . . . . . . . . . . . . . net . . . . . . . . . . . . Total property and equipment . . 2009 and 2008 was approximately $333. PREPAID COSTS AND OTHER CURRENT ASSETS Prepaid assets and other current assets consist of the following: December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $336 and $321. . . .

. . . . . . . . . . Goodwill acquired . . . . . 2006. . . . . . . . . . . . . The following table projects the expected future amortization of the above intangible assets for the next five years: Year Ending December 31. . . Balance at December 31. . . . . . 2010 Gross Carrying Accumulated Amount Amortization December 31. . . . . . . . . INTANGIBLES Goodwill Changes in the carrying amount of goodwill are as follows: GCUK GC Impsat ROW Total Balance at December 31. . . . 2015 . . . . . . . . . . . . Total . . . . . . . . 2007 and Fibernet on October 11. . . . . . . . . . . . . . . . . 4 yrs 10-12 yrs 1-4 yrs $ 4 30 3 $37 $ (4) (11) (3) $(18) $ 4 30 3 $37 $ (3) (9) (2) $(14) Intangible asset amortization expense was $4. . . . . . . . . . . 2009 Gross Carrying Accumulated Amount Amortization Customer contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4 1 $ 5 — — $ 5 $ 143 27 $ 170 — 4 $ 174 $ — — $ — 29 — $ 29 $ 147 28 $ 175 29 4 $ 208 Goodwill in the ROW Segment resulted from the Company’s acquisition of Genesis Networks on October 29. . . . . . . . . . . . . . . . . . . 2010. . . . Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Balance at December 31. . . 2008 . . . . . . . . . . . . . . . . . . . . 2009 and 2008. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3 3 3 3 2 $ 14 F-22 . . . . . . . . . . . . . . respectively. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 while goodwill in the GC Impsat and GCUK Segments resulted from the Company’s acquisitions of Impsat on May 9. . . . . . . . . . . . . respectively. . . . . . . Other Intangible Assets Estimated Useful Life December 31. 2009 . . . 2014 . Foreign currency impact . . . . . . . . .8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4 and $5 for the years ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . 2012 . . . . . . . . . . 2010 . . . 2013 . . . . . . . . . . . . Customer relationships . . . 2011 . . . . . . . . Foreign currency impact . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . Total future maturities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . 5% Convertible Notes . . . . . . . . . . . . . . . . . . . . . . 9% Senior Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 27 4 3 414 750 151 1. . . . . .9. . . . . . . . . . . . . . . . . . . . .338 F-23 . Other .” 10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .332 (37) $ 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total debt obligations . . . . . . . . .311 $ 1. . . . . . . . . . . . . DEBT Outstanding debt obligations consist of the following: December 31. . . . . . . . . . . 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total other current liabilities . . .295 2011 . . . . Unamortized discount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . “Related Party Transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net of premium . . . . . . . . . . . . . . . . . . . . . . . . . net of premium . . . . . . Other . . . . .349 (11) $ 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued preferred dividends(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . including value added taxes in foreign jurisdictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued professional fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued restructuring costs—current portion . . . . . . . . . . . . . . . . . . . Total debt obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2012 . . . . . . . Accrued third party maintenance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-current debt obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued payroll. . . . . . . . . . . . . 2010 2009 Accrued taxes. . 2010 2009 12% Senior Secured Notes . . . . . . . . . . . . . . . . . . . . . . . . . . Unamortized discount. . . . . . . . . . . . . Future maturities of debt are as follows as of December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Customer deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . Less: current portion of long term debt and short term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010: $ 750 429 150 — 20 (11) 1. . . . . . . . . . . . . and related benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .338 (27) $ 750 439 — 144 26 (27) 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GCUK Senior Secured Notes . . . . . . . . Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . commissions. . . . . . . . . . . . . . . . bonus. . . . . . . . . . . . OTHER CURRENT LIABILITIES Other current liabilities consist of the following: December 31. Accrued real estate and related costs . . . . (1) $ 105 58 34 26 31 14 9 8 8 5 5 73 $ 376 $ 117 58 34 — 29 22 10 12 9 10 4 79 $ 384 For further information see Note 20. . . . . . . . . . . . . .

the Company may redeem all or a part of the 9% Senior Notes at the redemption prices of 104. Interest on the notes accrues at the rate of 9% per annum and is payable semi-annually in arrears on May 15 and November 15 of each year through maturity. (6) sell assets. nil. and as of December 31. nil. restrict the Company’s ability and the ability of the Company’s restricted subsidiaries to: (1) incur or guarantee additional indebtedness or issue disqualified stock or preferred stock. with the net cash proceeds of one or more equity offerings by GCL. GCL has guaranteed $15 of the debt obligations of certain of its subsidiaries. (3) make certain investments (including investments in the GCUK Segment). professional fees and other transaction fees and expenses in connection with the offering. 2015 and thereafter were nil. (2) pay dividends or make other distributions. these GCL debt obligations consisted of the 12% Senior Secured Notes and the 9% Senior Notes. plus accrued and unpaid interest to the redemption date. respectively. 2010. 2012. As of December 31. if any. 2009. The Company used the proceeds from the issuance of the 9% Senior Notes to: (i) redeem the 5% Convertible Notes at an optional redemption price equal to 101% of their principal amount. 2010. In addition. Included in other income (expense). The indenture governing the notes contains covenants that. “Guarantees of Parent Company Debt”). $750 and $150. These covenants are subject to a number of important limitations and exceptions. (5) create liens. the Company may on any one or more occasions redeem up to 35% of the aggregate original principal amount of the 9% Senior Notes at a redemption price equal to 109% of the principal amount thereof. persons in offshore transactions in reliance on Regulation S under the Securities Act. $887 and $865. and (ii) outside the United States to non-U. the 12% Senior Secured Notes and the 5% Convertible Notes. 2011. and (9) designate subsidiaries as restricted. 2013. 2010. 2014. of the Company’s total debt obligations were obligations of the GCL parent company. 2013. 9% Senior Notes On November 16. plus a make-whole premium and accrued and unpaid interest. At December 31. 2010 and 2009. 2010. 2014 at a price equal to 100% of their principal amount. As of December 31. 2015.25% or 100% of par during 2014. 102. including capital stock of subsidiaries. However. commencing on May 15. on or after November 15. respectively. The 9% Senior Notes are guaranteed by the vast majority of the Company’s direct and indirect subsidiaries other than the subsidiaries comprising the GCUK Segment and certain other subsidiaries described in the notes indenture (see Note 24.As of December 31. The 9% Senior Notes and the guarantees are senior unsecured obligations. nil. (4) enter into arrangements that restrict dividends or other payments to the Company from its restricted subsidiaries. among other things. The 9% Senior Notes are not registered under the Securities Act and the initial purchasers agreed to sell the notes only: (i) in the United States to qualified institutional buyers in reliance on Rule 144A under the Securities Act.S. At any time prior to November 15. 2019 (the “9% Senior Notes”) at an issue price of 100% of their par value. the future maturities of GCL’s debt for the years 2011. they rank equally in right of payment with all of the Company’s and the guarantors’ other existing and future senior indebtedness and are effectively subordinated to all of the Company’s and the guarantors’ existing and future secured indebtedness to the extent of the collateral securing such indebtedness. (8) merge or consolidate with other companies or sell substantially all of the Company’s assets. the Company issued $150 aggregate principal amount of 9% senior notes due November 15. 2014. The Company may also redeem any of the 9% Senior Notes at any time prior to November 15. and (ii) pay the estimated initial purchaser discounts.5%. Accordingly. (7) engage in transactions with affiliates. and 2016 and thereafter. net in the Company’s consolidated statement of operations for 2010 is a charge of $6 recorded in connection with the early extinguishment of the 5% Convertible Notes. the Company is required to register an identical series of notes with the SEC F-24 .

These covenants are subject to a number of important limitations and exceptions. the remaining $125 was used for general corporate purposes. up to a maximum rate of additional interest of 1. subject to possible extensions under certain circumstances. (8) merge or consolidate with other companies or sell substantially all of the Company’s assets.and to offer to exchange those registered notes for the notes issued in connection with the initial offering by November 16. including capital stock of subsidiaries. the Company is obligated to pay special interest in an amount equal to 0. The 12% Senior Secured Notes are guaranteed by the vast majority of the Company’s direct and indirect subsidiaries other than the subsidiaries comprising the GCUK Segment and certain other subsidiaries as described in the notes indenture (see Note 24. subject to certain exceptions. The obligations of GCL and the guarantors in respect of the notes are senior obligations which rank equal in right of payment with all of their existing and future senior indebtedness. on GCL’s and certain of the guarantor’s existing and future assets.25% per annum on the principal amount of the notes. Under specified circumstances. (2) pay dividends or make other distributions. “Guarantees of Parent Company Debt”).103. together with a 1% prepayment penalty and unpaid interest to but not including the date of repayment (total cost of $348). 2010 was $1. The book value of such “Specified Tangible Assets” as of December 31. among other things. accounts receivable from third parties and property. Interest on the notes accrues at the rate of 12% per annum and is payable semi-annually in arrears on March 15 and September 15 of each year through maturity.25% for each subsequent 90-day period until the registration default is cured. In the event of registration default. the Company and the guarantors would be required to file a shelf registration statement for the resale of the 9% Senior Notes. 2015 (the “12% Senior Secured Notes”) at an issue price of 97. The indenture governing the notes contains covenants that. The maximum possible additional interest payable in the period from November 16. plant and equipment under capital leases and leasehold improvements)) of GCL and the “Grantor Guarantors” organized in “Approved Jurisdictions” (as such terms are defined in the notes indenture).000 threshold required to make restricted payments pursuant to certain of the exceptions to the covenants in the notes indenture. (4) enter into arrangements that restrict dividends or other payments to the Company from the Company’s restricted subsidiaries. limit the Company’s ability and the ability of the Company’s subsidiaries (other than those comprising the GCUK Segment) to: (1) incur or guarantee additional indebtedness or issue disqualified stock or preferred stock. These assets generally include the “Specified Tangible Assets” (defined in the notes indenture as cash and cash equivalents. 2011. 2019 (the maturity date) would be $11. and (9) designate subsidiaries as restricted. (3) make certain investments (including investments in the GCUK Segment). F-25 . In addition.944% of their par value. the 12% Senior Secured Notes are secured by firstpriority liens. 2010. (ii) purchase all of the GC Impsat Notes validly tendered in a tender offer for such notes. 12% Senior Secured Notes On September 22. the Company issued $750 in aggregate principal amount of 12% senior secured notes due September 15. (6) sell assets. (7) engage in transactions with affiliates. and (iii) pay the estimated initial purchaser discounts. professional fees and other transactions fees and expenses in connection with the offering. After these costs. (5) create liens. plant and equipment (other than property. which exceeds the $1. including a consent fee of 5% of the principal amount of those notes tendered by the early withdrawal date (total cost of $237).00% per annum. with such rate increasing by an additional 0. The Company used proceeds from the issuance of the 12% Senior Secured Notes to: (i) repay the Term Loan Agreement in full. and increasing the Company’s consolidated cash balance. 2011 to November 15. 2009. The transaction was intended to simplify the Company’s capital structure and to improve the Company’s liquidity and financial flexibility by effectively extending the May 2012 maturity of the Company’s Term Loan Agreement. including if the exchange offer would not be permitted by applicable law or SEC policy. commencing on March 15. reducing contractual restrictions on intercompany transactions between the Company’s GC Impsat and ROW Segments.

in whole but not in part. On December 28. at any time on or after December 15. plus a make-whole premium and accrued interest. 2012.Included in other income (expense).S. 2006. The additional notes were issued at a premium of approximately 5 pounds sterling. Interest is payable in cash semi-annually on June 15 and December 15. F-26 . At any time prior to September 15. The U. GCUK Finance may redeem the GCUK Notes in whole or in part. 2012 at a price equal to 100% of the principal amount. respectively. on or after September 15. (iii) make investments or other restricted payments. (ii) pay dividends or make other distributions to repurchase or redeem its stock. respectively. The indenture governing the GCUK Notes limits GCUK’s ability to. Dollar denominated senior secured notes and 105 pounds sterling aggregate principal amount of 11. GCUK Senior Secured Notes On December 23. a wholly owned financing subsidiary of the Company’s Global Crossing (UK) Telecommunications Limited subsidiary (together with its subsidiaries.S. of approximately $111. if any. including the capital stock of GCUK Finance. The GCUK Notes are senior obligations of GCUK Finance and rank equal in right of payment with all of its future debt. plus accrued and unpaid interest to the redemption date.875% (for the pounds sterling denominated notes) in 2009 to 100% of the principal amount in 2012 and thereafter.S. merge or sell all or substantially all of its assets. GCUK Finance may also redeem either series of notes. the “GCUK Notes”).375% (for the U.75% U. “GCUK”) issued $200 in aggregate principal amount of 10. which resulted in the Company receiving gross proceeds. 2010. of approximately $398. All $750 aggregate outstanding principal amount of notes participated in the exchange offer which satisfied the obligation incurred by the Company under a registration rights agreement that the Company entered into in connection with the original issuance of the notes. net in the Company’s consolidated statement of operations for 2009 is a charge of approximately $29 recorded in connection with the early extinguishment of the GC Impsat Notes and Term Loan Agreement. the Company may on any one or more occasions redeem up to 35% of the aggregate original principal amount of the 12% Senior Secured Notes at a redemption price equal to 112% of the principal amount thereof. with the net cash proceeds of one or more equity offerings by GCL. 2009 for an identical series of notes that have been registered under the Securities Act of 1933. the Company completed an offer to exchange the notes issued on September 22. The GCUK Notes mature on the tenth anniversary of their issuance.75% pounds sterling denominated senior secured notes (collectively. 103% or 100% of par. and (vii) consolidate. Dollar and pound sterling denominated notes were issued at a discount of approximately $3 and 2 pounds sterling. Global Crossing (UK) Finance PLC (“GCUK Finance”). Dollar denominated notes) or 105. but certain material assets of GCUK do not serve as collateral for the GCUK Notes. upon certain changes in tax laws and regulations. GCUK has guaranteed the GCUK Notes as a senior obligation ranking equal in right of payment with all of its existing and future senior debt. 2004. 2009 at redemption prices decreasing from 105. In addition. The GCUK Notes are secured by certain assets of GCUK and GCUK Finance. as amended (the “Securities Act”) with the SEC. GCUK Finance issued an additional 52 pounds sterling aggregate principal amount of pound sterling denominated GCUK Notes. 2013 and 2014. The GCUK Notes were issued under an indenture which includes covenants and events of default that are customary for high-yield senior note issuances. before underwriting fees. before underwriting fees. among other things: (i) incur or guarantee additional indebtedness. which resulted in the Company receiving gross proceeds. (v) enter into certain transactions with affiliates (vi) enter into agreements that restrict the ability of its material subsidiaries to pay dividends. (iv) create liens. 2012. On August 2. the Company may redeem all or a part of the 12% Senior Secured Notes at the redemption prices of 106%. The Company may also redeem any of the 12% Senior Secured Notes at any time prior to September 15.

The hedging arrangements were subject to early termination upon events of default under the indenture governing the GCUK Notes. if any. the cross-currency interest rate swap was classified as a cash flow hedge. The Company measured the effectiveness of this derivative instrument on a cumulative basis. 2011. so long as GCUK is not then in default under the indenture. Under the indenture such a payment (i) may be made only if GCUK is not then in default under the indenture and would be permitted at that time to incur additional indebtedness under the applicable debt incurrence test. provided that any such excess payments shall reduce the amount of restricted payments permitted to be paid out of future Designated GCUK Excess Cash Flow. Dollar denominated GCUK Notes. within 120 days after the end of each twelve month period ending December 31. In addition. GCUK must offer (the “Excess Cash Offer”) to purchase a portion of the GCUK Notes at a purchase price equal to 100% of their principal amount. the hedge counterparty was granted a security interest in the collateral securing the GCUK Notes ranking equally with the security interest holders of the GCUK Notes. exclusive of accrued but unpaid interest. The 5% Convertible Notes could have been converted at any time prior to maturity at the option of the holder into shares of the Company’s common stock at a conversion price of F-27 . In the exercise of their fiduciary duties. if any. the Company entered into a five-year crosscurrency interest rate swap transaction with an affiliate of Goldman Sachs & Co. (ii) may generally be made only within ten business days of consummation of each Excess Cash Offer.S. and (iii) would generally be limited to 50% of GCUK’s Designated GCUK Cash Flow plus the portion. would have matured on May 15. comparing changes in the cross-currency interest rate swaps cash flows since inception with changes in the hedged item’s cash flows (the interest payment on the $200 U. The notes were priced at par value. to minimize exposure of any U. With respect to the 2009 Excess Cash Offer. including its independent members.S. A loan or dividend payment by GCUK to the Company and its affiliates is a restricted payment under the indenture governing the GCUK Notes. Dollar-denominated GCUK Notes). the Company completed a public offering of $144 aggregate principal amount of 5% convertible senior notes due 2011 (the “5% Convertible Notes”) for total gross proceeds of $144. except to the extent of the value of any collateral securing such indebtedness. The swap transaction converted the U. exclusive of accrued but unpaid interest. In addition. and the associated purchases are required to be completed within 150 days after year-end. The cross-currency interest rate swap expired in 2009. 5% Convertible Notes On May 30. Dollar currency rate on interest payments to a specified pound sterling amount.As required by the indenture governing the GCUK Notes. For accounting purposes. Any such offer is required to be made within 120 days of year-end. Dollar/pound sterling currency fluctuations related to interest payments on the $200 U. With respect to the 2010 Excess Cash Offer. using 50% of “Designated GCUK Cash Flow” from that period. In order to better manage the Company’s foreign currency risk. “Designated GCUK Cash Flow” means GCUK’s consolidated net income plus non-cash charges minus capital expenditures.S. the Company made an offer for $18 and purchased less than $1 in principal amount of the GCUK Notes. GCUK may make up to 10 pounds sterling (approximately $15 at the exchange rate at December 31. calculated in accordance with the terms of the indenture governing the GCUK Notes. and accrued interest at 5% per annum.S. the Company anticipates making an offer of approximately $17. payable semi-annually on May 15 and November 15 of each year. The 5% Convertible Notes ranked equal in right of payment with any other senior indebtedness of Global Crossing Limited. 2006. The terms of any inter-company loan by GCUK to the Company or the Company’s other subsidiaries are required by the GCUK Notes indenture to be at arm’s length and must be agreed to by the board of directors of GCUK. GCUK’s directors will require GCUK to maintain a minimum cash balance in an amount they deem prudent. 2010) in the aggregate in restricted payments in excess of 50% of Designated GCUK Cash Flow for a given period. of the applicable Excess Cash Offer that the holders of the notes decline to accept. plus accrued and unpaid interest. to the purchase date.

for cash. The 5% Convertible Notes were within the scope of these amendments to ASC Topic 470.S. Other Financing Activities During 2010.75%.98 per share. The Company could have been required to repurchase. These agreements have terms that range from 6 to 48 months with a weighted average effective interest rate of 10%. For the years ended December 31. These agreements have terms that range from 12 to 48 months with a weighted average effective interest rate of 11. treasury securities with total face value of $21 for $20. the carrying amount of the equity component was $38. to convert the notes at an increased conversion rate based on the price paid per share of the Company’s common stock in a transaction constituting a fundamental change. See “9% Senior Notes” above.98 per share. plus accrued and unpaid interest.1%. At December 31. As of December 31. 2010. 2010. if applicable. The total debt obligation resulting from these agreements was $15. In addition.approximately $22. At any time prior to maturity. 2008. Upon adoption of these amendments to ASC Topic 470 on January 1.. respectively. and pledged these securities to collateralize the first six interest payments due on the 5% Convertible Notes. In May 2008. the Company could have unilaterally and irrevocably elected to settle the Company’s conversion obligation in cash and. interest expense for the 5% Convertible Notes related to the coupon and the amortization of the debt discount was $16 ($16 after-tax). if the 5% Convertible Notes were converted into shares of the Company’s common stock at a conversion price of $22. 2009 and 2008. the effective interest rate for the 5% Convertible Notes was 12. or. For each of the years ended December 31. During 2010. its unamortized discount and its net carrying value were $144. shares of the Company’s common stock. Concurrent with the closing of the 5% Convertible Notes offering the Company purchased a portfolio of U. As of December 31. F-28 . approximately 6. the FASB revised the guidance for debt in ASC Topic 470 with respect to debt with conversion and other options to clarify the accounting for convertible debt instruments that may be settled in cash upon either mandatory or optional conversion (including partial cash settlement) and to specify that issuers of convertible instruments should separately account for the liability and equity components in a manner that will reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. 2009. $15 ($15 after-tax) and $15 ($15 after-tax). 2009. the cumulative effect of this adoption resulted in an increase to the Company’s accumulated deficit of $17 related to prior period amortization of the debt discount and associated deferred financing fees. In addition.3 million shares of our common stock would have been issued. we used the proceeds from the issuance of the 9% Senior Notes to redeem the 5% Convertible Notes at an optional redemption price equal to 101% of their principal amount. 2009. $14 and $130. calculated as set forth in the indenture governing the 5% Convertible Notes. the Company reclassified $38 of the carrying value of the 5% Convertible Notes to additional paid-in capital. all or a portion of the notes upon the occurrence of a fundamental change (i. in certain cases. These amendments to ASC Topic 470 were required to be applied on a retrospective basis for financial statements issued for fiscal years beginning after December 15. 2009 the principal amount of the liability component. the Company entered into various debt agreements to finance various equipment purchases and software licenses. 2009 and 2008.e. the Company entered into various capital leasing arrangements that aggregated $41. and interim periods within those fiscal years. a change in control or a delisting of the Company’s common stock) at a purchase price equal to 100% of their principal amount.

. . . . . . . . . . . Thereafter . . . . . . . 2010. . . .11. . . . . . . . . . none of the Company’s obligations under capital leases were obligations of the GCL parent company. . . . . . . . . . . . . . . . As long as ST Telemedia beneficially owns at least 15% or more of GCL Common Stock on a non-diluted and as-converted basis. . . . . . . . . . . . . . . . . . . . . . . . . .478. . . . . . . . . . . The GCL Preferred Stock accumulates dividends at the rate of 2% per annum. . . . . . . . Less: amount representing interest . . . . . . . 2014 . . . Less: current portion . . . . . . . . . . . . . . . . . . . . . . . .261 shares of GCL common stock reserved or issued under the new management stock incentive plan (“Stock Incentive Plan”) adopted by GCL on the Effective Date. . . consolidations or reorganizations. . . . . (ii) material acquisitions or dispositions. . OBLIGATIONS UNDER CAPITAL LEASES The Company has capitalized the future minimum lease payments of property and equipment under leases that qualify as capital leases. . . . . depreciation and amortization (but excluding the contribution of (i) sales-type lease revenue (ii) revenue recognized from the amortization of indefeasible rights of use not recognized as sales-type leases and (iii) any revenue recognized from extraordinary transactions or from the disposition of assets by the Company or any subsidiary other than in the ordinary course of business) of $650 or more as demonstrated in the audited consolidated financial statements. . . . taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2015 . . . . . . . . . . . . . . . . . . . . . . . . . .000 shares of 2% cumulative senior convertible preferred stock to a subsidiary of ST Telemedia (the “GCL Preferred Stock”). . . . . . . . . . . . . . . . . . . . F-29 . . . . . . . . . . . . . . . . . The GCL Preferred Stock has a par value of $. (iv) issuance of additional equity securities (other than enumerated exceptions). . . . . future minimum payments under these capital leases are as follows and are included in obligations under capital leases in the accompanying consolidated balance sheet: Year Ending December 31. . . . . GCL has guaranteed $40 of the capital lease obligations of certain of its subsidiaries. . . . . . . SHAREHOLDERS’ DEFICIT Preferred Stock On the Effective Date. . . . . . . . . . . . . . (iii) mergers. . . . . . . . . . . . . . . . 2011 . provided that any distribution to shareholders following a disposition of all or any portion of the assets of GCL will be shared pro rata by the holders of Common Stock and Preferred Stock on an as-converted basis. At December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Those dividends will not be payable in cash until after GCL and its subsidiaries achieve cumulative operating earnings before interest. . . . . . . excluding up to 3. . . 2012 . . . . . . . . . (vi) capital expenditures in excess of specified amounts. . . . . . . but has class voting rights with respect to any amendments to the terms of the GCL Preferred Stock. . . . . $ 61 37 16 7 5 32 158 (35) 123 (51) $ 72 As of December 31. . . . . . . . The GCL Preferred Stock ranks senior to all other capital stock of GCL. . . . . Each share of GCL Preferred Stock is convertible into one share of GCL Common Stock at the option of the holder. . . . Long term obligations under capital leases . . . its approval will be required for certain major corporate actions of the Company and/or its subsidiaries. . . . . . . . . . . . . . . Those corporate actions include (i) the appointment or replacement of the chief executive officer. . . . Present value of minimum lease payments . . . 2013 . . . (vii) the commencement of bankruptcy or other insolvency proceedings. . . . 2010. . . As of December 31. . . . . . . . 2010. . . . . . . . . . . . . . . . . . and (viii) certain affiliate transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The preferred stock votes on an as-converted basis with the GCL common stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 per share and a liquidation preference of $10 per share (for an aggregate liquidation preference of $180). . . . Total minimum lease payments . . . . . . . . . . . . . . . . . . . . . . . GCL issued 18. . . . . . . 12. . . . . . . . . . . . . . (v) incurrence of indebtedness above specified amounts. . . . . . . . . . . . .000. . . . . . . . . . . .

At December 31, 2010 and 2009, accrued dividends were $26 and $22, respectively, and are included in “other current liabilities” and “other deferred liabilities”, respectively, in the accompanying consolidated balance sheets. Payment of the preferred dividend is predicated on the Company achieving a certain earnings-related objective as demonstrated by audited financial statements, which objective the Company achieved during 2010. After the initial payment on or after April 15, 2011 of accrued dividends accumulated since the preferred stock was issued in December 2003 through March 31, 2011, subsequent quarterly preferred stock dividends in the amount of $0.9 are expected to be payable on the fifteenth day of each July, October, January and April. Common Stock GCL is authorized to issue up to 110,000,000 shares of common stock. 18,000,000 shares of common stock are reserved for the conversion of the GCL Preferred Stock, while an additional 19,378,261 shares of common stock are reserved for issuance under GCL’s 2003 Stock Incentive Plan at December 31, 2010. Each share of GCL common stock has a par value of $.01 and entitles the holder thereof to one vote on all matters to be approved by stockholders. The amended and restated by-laws of GCL contain certain special protections for minority shareholders, including certain obligations of ST Telemedia, or other third parties, to offer to purchase shares of GCL Common Stock under certain circumstances. 13. INCOME TAX The benefit (provision) for income taxes is comprised of the following:
Year Ended December 31, 2010 2009 2008

Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (18) 23 $ 5

$ (21) 20 $ (1)

$ (14) (35) $ (49)

Income taxes have been provided based upon the tax laws and rates in the countries in which operations are conducted and income is earned. Bermuda does not impose a statutory income tax and consequently the provision for income taxes recorded relates to income earned by certain subsidiaries of the Company which are located in jurisdictions that impose income taxes. The current tax provision includes income, asset and withholding taxes for the years ended December 31, 2010, 2009 and 2008 of $18, $21, and $14, respectively. The deferred tax benefits for the years ended December 31, 2010 and 2009 of $(23) and $(20), respectively, resulted from a partial release of a valuation allowance on deferred tax assets. Fresh start accounting resulted in a net deferred tax provision of $30 in 2008 resulting from the utilization of pre-emergence net deferred tax assets that were offset by a full valuation allowance. The reversal of the valuation allowance that existed at the fresh start date was first recorded as a reduction of intangibles to zero and thereafter as an increase in additional paid-in-capital. The new accounting standard for business combinations also amended guidance for accounting for income taxes codified in ASC Topic 740 such that as of January 1, 2009 the reversal of pre-emergence valuation allowances are recorded as a reduction of tax expense. The deferred income tax provision reflects the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes.

F-30

The following is a summary of the significant items giving rise to components of the Company’s deferred tax assets and liabilities:
December 31, 2010 Assets Liabilities Assets 2009 Liabilities

Property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . Net operating loss (“NOL”) carry forwards . . . . . . . . . . Accounts receivable basis difference . . . . . . . . . . . . . . . Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$

241 1,753 200 — 79 2,273 (2,200)

$ — — — (30) — (30) — $ (30)

$

311 1,747 175 — 103

$ — — — (22) — (22) — $ (22)

2,336 (2,294) $ 42

$

73

The Company’s valuation allowance changed in the amount of $(94), nil and $(369) for the years ended December 31, 2010, 2009 and 2008, respectively. In evaluating the amount of valuation allowance required, the Company considers each subsidiary’s prior operating results, future plans and expectations and prudent and feasible tax planning strategies. The utilization period of the NOL carry forwards and the turnaround period of other temporary differences are also considered. A substantial amount of the Company’s pre-emergence NOL’s and other deferred assets generated prior to the bankruptcy have been reduced as a result of the discharge and cancellation of various pre-petition liabilities. As of December 31, 2010 the Company has NOL carry forwards of $4,722, $1,165, $505 and $1 in Europe, North America, Latin America and Asia, respectively, with various expiration dates or unlimited expiration. During 2008, the Company realized $5 of tax benefits as a result of the reversal of valuation allowances for deferred tax assets acquired as part of the Impsat acquisition. The recognition of the tax benefits for those items (by elimination of the valuation allowance) after the acquisition date resulted in a reduction of goodwill. This accounting treatment does not result in any change in liabilities to taxing authorities or in cash flows. The new accounting standard for business combinations also amended guidance for accounting for income taxes codified in ASC Topic 740, such that as of January 1, 2009 the reversal of pre-acquisition valuation allowances are recorded as a reduction of tax expense. The total amount of the unrecognized tax benefits as of the date of December 31, 2010 and 2009 was $28 and $29, respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Balance at January 1, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Additions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Decrease for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Balance at December 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Additions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Decrease for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Balance at December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Additions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Decrease for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-31 $ 20 15 (3) $ 32 1 (2) (2) $ 29 1 (2) $ 28

Included in the balance of unrecognized tax benefits at December 31, 2010 and 2009, are $24 and $24, respectively of tax benefits that, if recognized, would affect the effective tax rate. The Company also recognizes interest accrued related to unrecognized tax benefits in interest expense, and penalties in income tax expense. For the years ended December 31, 2010 and 2009, the Company (released)/accrued $(2) and $3, respectively, of interest and penalties related to unrecognized tax benefits. The Company had approximately $19, $21 and $18 for the payment of interest and penalties accrued in other current liabilities and other deferred liabilities at December 31, 2010, 2009 and 2008, respectively. It is not expected that the amount of unrecognized tax benefits will change significantly in the next twelve months. During 2007, the Company received notification from the Internal Revenue Service that its audit of the Company’s 2002, 2003 and 2004 tax years had resulted in the tax returns being accepted as filed, without change. Accordingly, the Company is no longer subject to U.S. federal income tax examination for periods prior to 2005. With respect to the United Kingdom, as of December 31, 2010, the Company is no longer subject to income tax inquiries by Her Majesty’s Revenue & Customs for the years up to and including 2007. The Company is also subject to taxation in various U.S. states and other non-U.S. jurisdictions. The Company and its subsidiaries’ income tax returns are routinely examined by various tax authorities. In connection with such examinations, tax authorities have raised issues and proposed tax adjustments. The Company is reviewing the issues raised and will contest any adjustments it deems inappropriate. In management’s opinion, adequate provision for income taxes has been made for all years that are open to audit. 14. REORGANIZATION ITEMS Pre-confirmation Contingencies During the year ended December 31, 2008, the Company settled various third-party disputes and revised its estimated liability for other disputes related to periods prior to the emergence from chapter 11 proceedings. The Company has accounted for this in accordance with AICPA Practice Bulletin 11, which was nullified as of the effective date of the new standard for accounting for business combinations (See Note 2). The resulting net gain on the settlements and change in estimated liability of $10 is included within net gain on pre-confirmation contingencies in the consolidated statement of operations for the year ended December 31, 2008. The most significant portion of the gain is a result of settlements with certain tax authorities and changes in the estimated liability for other income and non-income tax contingencies. 15. LOSS PER COMMON SHARE Basic loss per common share is computed as loss applicable to common shareholders divided by the weighted-average number of common shares outstanding for the period. Loss applicable to common shareholders includes preferred stock dividends of $4 for each of the years ended December 31, 2010, 2009 and 2008. Diluted loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. However, since the Company had net losses for each of the years ended December 31, 2010, 2009 and 2008; diluted loss per common share is the same as basic loss per common share, as any potentially dilutive securities would reduce the loss per share.

F-32

Diluted loss per share for the years ended December 31, 2010, 2009 and 2008 does not include the effect of the following potential shares, as they are anti-dilutive:
Potential common shares excluded from the calculation of diluted loss per share Year Ended December 31, 2010 2009 2008 (millions)

Convertible preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Employee stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

18 2 20

18 1 19

18 1 19

Employee stock awards to purchase less than one million shares for $15.39 per share and approximately one million shares for $10.16 or $15.39 per share were not included in the above table for the years ended December 31, 2010 and December 31, 2009, respectively, as the exercise price was greater than the average market price per share. The 5% Convertible Notes which were convertible into approximately 6.3 million shares at a conversion price of $22.98 per share were not included in the above table for each of the years ended December 31, 2009 and 2008 as the conversion price is greater than the average market price per share. The 5% Convertible Notes were retired in 2010 (see Note 10 for additional information related to the early retirement of the 5% Convertible Notes). 16. STOCK-BASED COMPENSATION AND ANNUAL BONUS The Company recognized $20, $18, and $55, respectively, of non-cash stock related expenses for the year ended December 31, 2010, 2009 and 2008. These expenses are included in selling, general and administrative expenses and real estate, network and operations in the consolidated statements of operations. Stock-related expenses for each period relate to share-based awards granted under Global Crossing Limited 2003 Stock Incentive Plan (the “2003 Stock Incentive Plan”) and reflect awards outstanding during such period, including awards granted both prior to and during such period. Under the 2003 Stock Incentive Plan, the Company is authorized to issue, in the aggregate, share-based awards of up to 19,378,261 common shares to employees, directors and consultants who are selected to participate. As of December 31, 2010, unrecognized compensation expense related to the unvested portion of all restricted stock units was approximately $15 and is expected to be recognized over the next 2.1 years. Sales Equity Program During 2008, the Company adopted the Global Crossing Sales Equity Program (“Sales Equity Program”) for the Company’s sales, sales support and sales engineering employees excluding those in Latin America, Canada and Asia. This program allowed management level employees to elect to receive 100% of their earned commissions in fully vested shares of common stock of GCL. Non-management employees could elect to receive 50% of their earned commissions in fully vested shares of common stock and the remaining 50% will be paid in cash. As an additional incentive for participating in the Sales Equity Program, the value of the portion paid in stock was increased by 5%, which was subsequently increased to 7.5% effective June 1, 2008. Included in the total 2008 non-cash stock related expenses was $10 related to this program. This program was cancelled in the fourth quarter of 2008. Stock Options Stock options are exercisable over a ten-year period, vest over a three-year period and have an exercise price of $10.16 or $15.39 per share. No stock options were granted during 2008, 2009 and 2010.

F-33

. . . . . . . . . . .414 $12. .071) (81. .00 $10. . . . . . .96 $15. . . . . . . . . . . . . . . . . . Total . . . . . . . . . . .081 (50. . . . . . . .2 $10. . . Balance as of December 31. during the year ended December 31. . 2010: Options Outstanding WeightedAverage Remaining WeightedContractual Average Life Exercise Price (in years) per Share Options Exercisable Exercise Prices Number Outstanding Number Exercisable WeightedAverage Exercise Price per Share $10. 2009 and 2008. . . . . 2010. .54 677. . . . the members of the Board of Directors and its Executive Committee were granted awards totaling 86. .261 fully vested shares of common stock. . . . . . . . . .748 restricted shares of common stock with a one year cliff vesting on July 8.605 243. . . 2008 .9 4. The total intrinsic value of options outstanding and exercisable was approximately $2 as of December 31. . . . . . . . . . . . . . . 2010 . . . . . . . . .16 $11. . . . . . . . . . Forfeited . . . . . . . . . . . At December 31. . . . . 2009 and 2008 is summarized below: Number Outstanding Weighted Average Exercise Price Balance as of January 1. representing both installments of the directors’ annual retainer fees that was payable in shares rather than cash. . . . . nil and $1. . . .34 $11. . . .55 $10.16 . . . .605 243. . . . . .327) 1.414 2. . . . . .44 $15. . . . . . . 2010. . . .081 (14. . . . . . . . 2010. . These awards were made in accordance with the Company’s annual long-term incentive program for Board of Directors and Executive Committee members. . . . . . . Exercised . . . . During the year ended December 31. . . . . . . . .39 $11. . . .2 years for stock options exercisable as of December 31. .479 (123. . . . . . . . 2010. . . . . . . . . . .251.39 . . . . . .414 $10. . . . . .334) 978. . . . . . . . . . . 677. . . . . . . . . . . . . . . . . . . . . . Also. .86 $11. .51 $10. . . . 2010. . . . . .666) (54. . . . . . . . . Exercised . . . . . . . . . . . Balance as of December 31. in conjunction with the Company’s annual long-term incentive program for 2010. . . . . $15. . . . .389 restricted stock units which vest on February 1. . there was no unrecognized compensation expense for stock options. . . . . . . . . . . . The total intrinsic value for stock options exercised was nil. .54 The weighted average remaining contractual term was 3. . . . . . . . . the members of the Board of Directors and its Executive Committee were granted awards totaling 24. . . . . . . . . . . . .39 $11. . . . During the year ended 2010. . . . . . . 2009 . . . . . . . 2010. the members of the Board of Directors and its Executive Committee were granted awards totaling 21. 2013. . . . . . . . . . . . . . . . .144 fully vested shares of common stock. . . . . . . . . . . . . . . . 2009. representing the first F-34 . . Forfeited . . . . .000) (6. . . .16 $15. . . . . . . . .39 $11. . . . . . . . Restricted Stock Units During the year ended December 31. .54 The following table summarizes information concerning outstanding and exercisable options for the year ended December 31. . . Balance as of December 31. 2011. . . .0 3.047. Forfeited . . . . . respectively.16 $15. . . . . Exercised . . . . . . . . . . . during 2010. . . . . . . . . . . . .Information regarding options outstanding for the years ended December 31. . . 2008 . .667) 921.809 921. . . 1. . . the Company awarded to certain employees 577. . . . . .809 921. . . . .

. . . . . . Granted . Forfeited . . . . . . . . . . . . . . . . . 2009. subject to continued employment through the vesting date and subject to earlier pro-rata payout in the event of death or F-35 . . . . . . . . . . . . . . . . . . . . Balance as of December 31. . . . . . . . . 2008 . . . . . . . Balance as of December 31. .00 $ 7. . .167. . . .219. . . . during 2008 several employees were granted small awards of unrestricted shares of common stock and restricted stock units which vested in 2009. . . . . . .596) 1. . . . . . . . . . . . . . .installment of the directors’ annual retainer fees that was payable in shares rather than cash. . . . . . . . . . . . . . 2009 . . 1. . . . . . . . . . . . . . . . . . . . . . 2010. 2008. . . . . Vested RSUs withheld for tax purposes . .093. . . During the year ended 2009. . . 2008. . . . . . . . .717 688. 2012. . . . . . . . . . . . . representing both installments of the directors’ annual retainer fees that was payable in shares rather than cash. . . . . . . . . . . . 2012. . . in conjunction with the Company’s annual long-term incentive program for 2008. . . forfeited and canceled for the years ended December 31. . . . . . Granted . . . . . . . . 2011. . .892) (50. . . . . . . . . . . . . . . . . . . . .15 $13. . . Vested RSUs withheld for tax purposes .389 performance share opportunities which vest on December 31. . . . . . . . . . .686 (345. . . . . . . . . . . . . . . . . . . . . In addition. the Company awarded to certain employees 1. . 2008 . .566 (485. . . Vested . . during the year ended December 31. . . . . . . . . . . . . .300) 2. . . . . . . . . . . These awards were made in accordance with the Company’s annual long-term incentive program for Board of Directors and Executive Committee members. . Forfeited . . . . . . . . . . . . . . . . .140 restricted shares of common stock with a one year cliff vesting on June 4. . . 2010. . . .171. . . . The second installment of the directors’ annual retainer fees were paid in cash and was expected to be paid in cash going forward. . .804) (52. . . . . all vested on June 24. . . . . . Balance as of December 31. . . . during the year ended December 31. . . .500 restricted stock units which vest on March 4. . . . . . . . . . . . . . . . . . . . . . . .222) (149.265) 1. . . . .856 674. .281 (227. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112 restricted shares of common stock. . . . . . . . . 2009. . . . The following table summarizes restricted stock units granted. . . . Granted . . . . . . . . . . . . . . . .686 fully vested shares of common stock. . . . . . . . . . . . . . . the members of the Board of Directors and its Executive Committee were granted awards totaling 28. . . . . .709) (148. . . . . . . the members of the Board of Directors and its Executive Committee were granted awards totaling 17. . . . . . 2009 and 2008: Number of Restricted Stock Units WeightedAverage Issue Price Balance as of January 1. .285 restricted stock units which vest on March 12.002 $20. . . . . . . Vested RSUs withheld for tax purposes . . . Also. .68 Performance Share Grants In connection with the Company’s annual long-term incentive program for 2010. . . . . . Vested . . . . . . . . During the year ended December 31. . These awards were made in accordance with the Company’s annual long-term incentive program for Board of Directors and Executive Committee members. . . . . . . 2010 . the Company awarded to certain employees 577. . . . . Forfeited . . . . . . . Vested . . During the year ended 2008. .813. . . in conjunction with the Company’s annual long-term incentive program for 2009. . . . . . . . . . . . . . . . . Also. . . . . . .623) (78. . . . . . . . . . . .141 1. . . . . . . the Company awarded to certain employees 568. . . . . . . . . . . . . . . . . . . of which. . . . . . . . . . . . . . . . . . . . . . . . . . . the members of the Board of Directors and its Executive Committee were granted awards totaling 50.976) (193. . . . . . . . . . .372. . . . . . . . . . . . .

2010 and must be paid out by March 15. Depending on how the Company ranks in total shareholder return as compared to the two peer groups. In connection with the Company’s annual long-term incentive program for 2008. 2010. including employer liability for payroll taxes and charges. subject to continued employment through the vesting date and subject to earlier pro-rata payout in the event of death or long-term disability. As of December 31. Each participant’s target performance share opportunity is based on total shareholder return over a three year period as compared to two peer groups. 2011. each performance share grantee may earn 0% to 200% of the target number of performance shares. and the maximum payout of 200% will be made if such average ranking is at or above the 80th percentile. The amount is expected to be paid out in cash. Annual Bonus Program During 2010. and $16 in cash was paid out in 2010. The Company paid out 235. Actual awards under the 2009 Bonus Program were to be paid in the sole discretion of the Compensation Committee of the Board of Directors based upon such factors as the Committee deemed relevant. No payout will be made if the average ranking of the Company’s total shareholder return relative to each of the two peer groups (weighted equally) is below the 30th percentile. the Board of Directors of the Company adopted the 2010 Annual Bonus Program (the “2010 Bonus Program”). Each participant was provided a target award under the 2009 Bonus Program expressed as a percentage of base salary. No payout will be made if the average ranking of the Company’s total shareholder return relative to each of the two peer groups (weighted equally) is below the 30th percentile. subject to continued employment through the vesting date and subject to earlier pro-rata payout in the event of death or long-term disability.093. the Company awarded to certain employees 1. which was intended to retain such employees and to motivate them to achieve the Company’s financial and business goals. Each participant’s target performance share opportunity is based on total shareholder return over a three year period as compared to two peer groups. 2011 of which 71. 2011. including employer liability for payroll taxes and charges. Depending on how the Company ranks in total shareholder return as compared to the two peer groups. Each participant is provided a target award under the 2010 Bonus Program expressed as a percentage of base salary. 2009. Depending on how the Company ranks in total shareholder return as compared to the two peer groups. and the maximum payout of 200% will be made if such average ranking is at or above the 80th percentile. and the maximum payout of 200% will be made if such average ranking is at or above the 80th percentile. No payout will be made if the average ranking of the Company’s total shareholder return relative to each of the two peer groups (weighted equally) is below the 30th percentile. $19 had been accrued in other current liabilities for this bonus plan. which was intended to retain such employees and to motivate them to achieve the Company’s financial and business goals. Each participant’s target performance share opportunity is based on total shareholder return over a three year period as compared to two peer groups. F-36 . The 2009 Bonus Program was an annual bonus applicable to substantially all non-sales employees of the Company. Actual awards under the 2010 Bonus Program were to be paid in the sole discretion of the Compensation Committee of the Board of Directors based upon such factors as the Committee deems relevant. The 2010 Bonus Program was an annual bonus applicable to substantially all non-sales employees of the Company. including the extent to which the Company achieved specified targets for earnings and cash flow.523 were withheld in connection with the payment of related withholding taxes for executive officers and certain other employees restricted from selling their shares of Company stock due to legal and policy restrictions applicable to corporate insiders.285 performance share opportunities which vest on December 31.800 performance shares under this plan on January 20. In connection with the Company’s annual long-term incentive program for 2009. $16 had been accrued in other current liabilities for this bonus plan. the Board of Directors of the Company adopted the 2009 Annual Bonus Program (the “2009 Bonus Program”). each performance share grantee may earn 0% to 200% of the target number of performance shares. each performance share grantee may earn 0% to 200% of the target number of performance shares. As of December 31.500 performance share opportunities which vest on December 31. the Company awarded to certain employees 936. including the extent to which the Company achieved specified targets for earnings and cash flow. During 2009.long-term disability.

There is a minimum employee contribution of 4% of basic salary with the Company matching the employee contribution up to a maximum of 6% of basic salary. $3 and $3 for the years ended December 31. Global Crossing North America. $31 had been accrued for this bonus plan. The amount of the shares to be paid was set using a 30-day average of the Company’s Common Stock. Under the 2008 annual bonus program. The 2008 Bonus Program was an annual bonus applicable to substantially all non-sales employees of the Company intended to retain such employees and to motivate them to achieve the Company’s financial and business goals. a new Group Personal Pension arrangement was established. 2009. Each eligible employee may contribute on a tax-deferred basis a portion of his or her annual earnings not to exceed certain limits. Inc. Each participant was provided a target award under the 2008 Bonus Program expressed as a percentage of base salary. respectively. 2009 and 2008. The payout for each performance opportunity was calculated independently. the Board of Directors of the Company adopted the 2008 Annual Bonus Program (the “2008 Bonus Program”). As of December 31.636.728. the Company reinstated matching employee contributions to this plan which previously had been suspended in March 2009. On November 1. including employer liability for payroll taxes and charges which was included in other current liabilities and other deferred liabilities.’s pension plan was frozen on December 31. the Company maintained a defined contribution plan for the employees of GCUK. Other defined contribution plans are not individually significant and therefore have been summarized in aggregate below. The Company’s contributions to the 401(k) Plan vest immediately. all existing plan participants became 100% vested and all employees hired thereafter are not eligible to participate in the plan. On an aggregate basis the expenses recorded by the Company relating to these plans were approximately $2. 2008. 2010. The Global Crossing Limited Employees’ Retirement Savings Plan (the “401(k) Plan”) qualifies under Section 401(k) of the Internal Revenue Code. The plans provide defined benefits based on years of service and final average salary. 2011. for the years ended December 31. Each eligible employee contributed on a tax-deferred basis up to 4% of his or her annual basic salary with the Company contributing up to 8% of salary. Inc. Up until October 31. Effective January 1. $3 and $3. F-37 . Defined Benefit Plans The Company sponsors both contributory and non-contributory employee pension plans available to eligible employees of Global Crossing North America. $1 and $5. 2010. The Company plan will provide 100% matching contributions up to the first 1% of eligible compensation and 50% matching contributions up to the next 5% of eligible compensation. Actual awards under the 2008 Bonus Program were to be paid only if the Company achieved specified thresholds for earnings. 4. 2009 and 2008. and GCUK. EMPLOYEE BENEFIT PLANS Defined Contribution Plans The Company sponsors a number of defined contribution plans. 17. The principal defined contribution plans are discussed individually below.664 common shares vested in March and April 2009 of which 1. Expenses recorded by the Company relating to the 401(k) Plan for the years ended December 31. Effective February 12. this defined contribution section of the Global Crossing Pension Scheme closed. 2010. As of that date.520 were withheld in connection with the payment of related withholding taxes for all employees with a tax liability. 2010. Other defined contribution plans sponsored by the Company are individually not significant.During 2008. 2009 and 2008 were approximately nil. respectively. respectively. 2009. net change in unrestricted cash and cash equivalents and/or customer satisfaction. Expenses recorded by the Company relating to these plans were approximately $3. the Compensation Committee and Board of Directors certified the financial results and approved the payout which was made primarily in restricted stock units vesting no later than April 8. As of this date. 1996. 2010.

. . . . . . . . respectively. . . . . . Amendments . . . . . . . . . . . . . . respectively at December 31. . The projected benefit obligation and fair value of plan assets for this plan was $58 and $51. . Effective November 1. . . . . . . 2010. . . . . . . . . . . . . . . . . . . . 2010 2009 Fair value of plan assets at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . Foreign exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009. . . . Projected benefit obligation at end of period . . . . . . . $ — 3 $ 3 $ (12) 4 $ (8) The GCUK Railway Pension Plan projected benefit obligation exceeded the fair value of plan assets at December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 Funded status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . the GCUK Pension Plan was amended with the result that the participant’s life assurance benefits are now administered outside of the plan. . . . . . . . $ 89 1 5 (6) — (3) (3) $ 83 $ 79 1 5 — (1) (3) 8 $ 89 Changes in the fair value of assets for all pension plans sponsored by the Company are as follows: Pension Plans December 31. . . . . . . . Foreign exchange . . . . . . . . . . . . . . . . Both pension plans were closed to new employees on December 31. . . . . . . . . . . . . . . . . . . . . . . Employer contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Company uses a December 31 measurement date for all pension plans. . . . . . . . Benefits paid . . . F-38 . . . . . . . . . . . . . . . . . 2010 and 2009. . . . . . . . . . . . . 2010 2009 Projected benefit obligation at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net . . . . . . . . . . . . . Actual return on plan assets . . . The GCUK Railway Pension Plan is a pension plan that splits the costs 60%/40% between the Company and the employees. . . . . . . Fair value of plan assets at end of period . . . . . . . . . Benefits paid . . . 2010 and $60 and $49. Accrued benefit cost. . . Actuarial gain . . . . . . . . . . . . . . . . . . . . . . . . . . Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . respectively at December 31. . . . . . Funded status attributable to employees . . . This amendment has had the effect of reducing the projected benefit obligation by $6 at December 31. . . . . . . . 2010.GCUK has two separate pension plans: the Global Crossing Pension Scheme (“GCUK Pension Plan”) and the Global Crossing Shared Cost Section of the Railways Pension Scheme (“GCUK Railway Pension Plan”). . . . . . . . . . . . . . . . . . . $ 77 8 4 (3) (3) $ 83 $ 62 10 2 (3) 6 $ 77 The funded status for all pension plans sponsored by the Company are as follows: Pension Plans December 31. . . . . . 1999. . . . . . . . . . . . . . Changes in the projected benefit obligation for all pension plans sponsored by the Company are as follows: Pension Plans December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . .16% 3. . . . . . . Interest cost on projected benefit obligation . at December 31. . . . .25% 4.90%-6. . . . . .75% 5. . . . . . The equity pooled fund which represents the majority of the assets comprises a substantial portion of assets managed on an index tracking basis. . . . . . . . . . . . . . . . .10% 4. . . . 2010 the actual allocation was 58% in equities securities. . . . . . . property. . . .90%-6. .10% 5. . . 2009 2008 Discount rate . . . . . . . . Rate of compensation increase . 14% in debt securities. . .30%-8. . . . . . . . . . Investment strategies for the two significant pension plans are as follows: The GCUK Railway Pension Plan. . . . . . . . . . . . . . . . .50%-5. . Details of the effect on operations of the Company’s pension plans are as follows: Pension Plans Year Ended December 31. . . The target allocation is 55% in equity securities. commodities. . . . . The fund invests in a variety of mutual funds that track U. . . . . .60% 4. . . . . . . . . . . . . . . .50% 4. . . . . return and correlation for each major asset class. . . and cash. . . . The target allocation is 65% in equities and 35% in debt securities. . and/or international indexes as well corporate and government bonds. Amortization of net loss . which represents approximately 22% of the Company’s total plan assets at December 31. Rate of compensation increase . . . . .50%-8. Net cost . . . . . .60%-6. . . . . . . . . . . . . . includes equities and fixed interest securities. . . . 2010 invests in a range of pooled funds covering different asset classes. . .30%-8. . . pension plan. . These funds adopt the principles which involve setting limits to the amount of investment risk each pooled fund is prepared to take compared to the set benchmark. . . . 2010 2009 Discount rate . . 16% in real estate and 12% in other. . . . . . . . respectively. 2009. . . . . . . . . . . . . . . . . . . . . . $ 1 4 (4) — $ 1 $1 4 (3) 1 $3 $ 2 4 (5) — $ 1 Actuarial assumptions used to determine benefit obligations for the Company’s pension plans are as follows: December 31. . .S. infrastructure. . invests in a variety of funds to provide wide diversification of asset classes and achieve a superior long term investment return compared with fixed income securities. . .45% 5. . . . at December 31. . .45% Actuarial assumptions used to determine net periodic costs for the Company’s pension plans are as follows: 2010 Year Ended December 31. . . . . The Global Crossing North America. . . . . . . . Expected long-term return on plan assets . . . . . .45% 5. . . . . . . . . . 5. . . . . . . . . . . . . . . . F-39 . .00% In order to project the expected long-term return on plan assets. . 2010 the actual allocation was 65% in equities and 35% in debt securities. 2010 2009 2008 Service cost . The projected benefit obligation and fair value of plan assets for this plan was $15 and $11. . . . . . . . . . . . . . . . . . . . . . . the Company reviews long-term historical returns and expected risk. . 10% in real estate and 10% in other.90% 5. . 2010. . . . . Inc. . . .The GCUK Pension Plan projected benefit obligation exceeded the fair value of plan assets at December 31. . . . Expected return on plan assets . . . . . . . bonds. . . 5. which represents approximately 62% of the Company’s total plan assets as at December 31. . . . 25% in debt securities. . . . .04% 4. . .

. . . . . EU and Japan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Unquoted securities are measured at their estimated fair value based on advice from investment managers. and levels within the fair value hierarchy in which the fair value measurements fall for pension plan asset classes at December 31. . . . . partnerships and hedge funds. . . . . (1) (2) $ 8 1 6 15 6 9 2 17 24 4 3 5 5 6 3 1 51 $83 $— — — — — 6 — 6 — — — — — — — — — $ 6 $ 8 1 6 15 6 3 2 11 24 4 3 — — — — — 31 $57 $— — — — — — — — — — — 5 5 6 3 1 20 $20 (3) (4) (5) This class includes investments that track unmanaged U. . . . . pooled investment vehicles are stated at bid price for funds with bid/offer spreads. . . 2010 Quoted Prices in Active Significant Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Asset Class Equity securities: U. . . . . . . . . . . . . . . . . . . . . . . . 15% cash deposits and cash instruments and 3% unquoted fixed interest securities. .S. . . large-cap(1) . . . . . . . . . intermediate-term bonds. . . . . . . . . . . . . . . small-cap . . . . . or single price where there are no bid/offer spreads. . . . . . . . . . This class represents investments in U. . . . . . . . . . . . . .K. . .. . large-cap(2) . . . . . . . . . . . . . . 2010 and 2009: Fair Value Measurements at December 31. . . . . . . . The following tables summarize the fair values. . . . . . . . . . . . . . Non government bond(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fixed income securities: U. . . . . . Pooled funds: Global equity(5) . . .S. . . . . . . . . . . . . . Private equity(10) . . . . . . . . . . . . . . Commodities . . . . Total pooled funds . . . .S. . . . . . . F-40 . . . . and commercial properties are included at open market value as at the year-end date which have been valued by qualified independent surveyors. . . Total Fixed Income . . . . large-cap indexes. . . . . . . . . . Non-U. . . . . . . . . . . . . . . . . . . . . . . U. . . . . . . Total . . . . . . . . . . . . . Government bond(7) . . . . . . . . Other Fixed Income(3) . . . . . . . . . . Total equity securities . . Level 3: Unobservable inputs that are not corroborated by market data. . . . . . . . . . . . . . . . Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. .S. . . . . . . . . . . . .S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .S. . . . . . . This class includes investments that track unmanaged international indexes primarily in U. . . . . . Infrastructure(11) . . . . . . . . 31% unquoted unitized insurance policies. . Non-U. . . . . . . . . . . . . . . . . . . . .S. Treasuries/Government Bonds(4) . Property(9) . . . . . . . . . . . . . . . . . . . This class includes investments in U. . . government bonds. . . . Cash plus(8) . . . . . . . . . . . . . . . . . . . . . . . .S. . . . . . . . . . . . . . . . . Corporate bonds . . . . . . . Non-U. . . . . This class comprises investments in approximately 51% quoted equities and fixed interest securities. . . . . . . . . . . . . . . . . . . . . . .Items Measured at Fair Value The Company classifies and discloses pension plan assets in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets. . . . . . . . . . . . . . . . . . .K. . . . .

Infrastructure(10) . . . . . . Cash plus(7) . . . . . . . . . . intermediate-term bonds. . . . . . . . commercial property either directly or indirectly and 16% cash deposits and cash instruments. . . . . . . . . . . . Total pooled funds . . . . . . . . . .S. . . . . . . . . . . . . . . . . . . . . . government bonds. Private equity(9) . . . . . . . . . . . . . . . . . . . . . . . This class includes investments in U. . . . . . . . . . . . . Other Fixed Income(3) . . . . . . . . . . .K. . . . . . . . commercial property either directly or indirectly and 16% cash deposits and cash instruments. . . Global bond (hedged)(6) . . . . . . . . . . . . . . . . . . . . . . . . 20% cash deposits and cash instruments. This class includes investments in 58% unquoted unitized insurance policies. . (1) (2) $ 8 1 5 14 6 7 1 14 19 7 5 5 8 4 1 49 $77 $— — — — — 5 — 5 — — — — — — — — $ 5 $ 8 1 5 14 6 2 1 9 19 7 — — — — — 26 $49 $— — — — — — — — — — 5 5 8 4 1 23 $23 (3) (4) (5) (6) (7) (8) This class includes investments that track unmanaged U. . . . . .K. . . . . . . . .S. . F-41 . . Total Fixed Income . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . partnerships and hedge funds. .(6) (7) (8) (9) (10) (11) This class includes investments in bonds and other investments with bond characteristics. . . large-cap(2) . . . . . . . large-cap(1) . . . . . . . . . . . . . . . . . . .S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . partnerships and hedge funds. . . . . Property(8) . . . . . . This class primarily includes investments in 84% U. . . . 16% cash deposits and cash instruments and 8% derivative contracts. . . . . . . . . . . . . large-cap indexes. . . . . . . . . . . . partnerships and hedge funds and 12% derivative contracts. . . . . . . . . . . . . Corporate bonds . . . . . . . . This class represents investments in U. . . . . . . . . . . . . . . This class comprises investments in approximately 76% quoted fixed interest securities. . . . . .K. partnerships and hedge funds and 42% Global equity pooled fund. . . . . .K. . This class comprises investments in approximately 80% unquoted unitized insurance policies. . . 16% cash deposits and cash instruments and 4% quoted equities. Total equity securities . . . . . . . . . . . .S. small-cap . 24% quoted equities and 2% cash deposits and cash instruments. . . . . . Non-U. . . . . . . This class includes investments in 74% unquoted unitized insurance policies. . . . . . . . . . . . . . . . . . . . . . This class primarily includes investments in 84% U. . . . . . . . . . partnerships and hedge funds. . .S. . . . . . . . . . . . . .S. . . . . . . . . . . . . . . . . . . . . .S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . This class comprises investments in approximately 48% quoted equities and fixed interest securities. . . Fixed income securities: U. . . . . . . . . . U. . . Fair Value Measurements at December 31. . 20% unquoted unitized insurance policies. . . . . . . . . . . . . . . This class includes investments that track unmanaged international indexes primarily in U. . This class includes investments diversified in government bond markets worldwide. . 2009 Quoted Prices in Active Significant Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Asset Class Equity securities: U. . . . This class comprises investments in approximately 80% unquoted unitized insurance policies. . . . . . . . . . Commodities . . . . . . . . . . 16% cash deposits and cash instruments and 4% quoted equities. . . . . . . . . EU and Japan. . . . . . . . . . . . . . Pooled funds: Global equity(5) .S. . . . . . . . Treasuries/Government Bonds(4) . Non-U. . . . . . . . . . Total . . . . . . Non-U. .

. . . . . . . . . . . . . . . . . . . . . . . . Purchases. . . . . . . . . . . . . . . . . . . . . Actual return on plan assets: Relating to assets still held at the reporting date . . . . . . . $ 5 $ 4 $ 8 $ 4 $— $21 1 (1) $ 5 1 — $ 5 — — $ 8 — — $ 4 — 1 $ 1 2 — $23 — — $ 5 — — $ 5 1 (3) $ 6 (1) — $ 3 — — $ 1 — (3) $20 The total accumulated benefit obligation (“ABO”) for all pension plans sponsored by the Company was $75 and $76. . . . . . . . . . This class includes investments in 74% unquoted unitized insurance policies. . Ending balance at December 31. . . . . . . . . . . . . . . . . . .(9) (10) This class includes investments in 57% unquoted unitized insurance policies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24% quoted equities and 2% cash deposits and cash instruments. . . . . . . . . . . 2016-2020 . . . . . . . . . . . . . . respectively. . . . . . . . . . . . . . . . . . . . . . . . . Ending balance at December 31. . . and settlements . Actual return on plan assets: Relating to assets still held at the reporting date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009 . . 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . Information for pension plan with an accumulated benefit obligation in excess of plan assets As of December 31. . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 Projected benefit obligation . . . 2009. . . . . . . . . . . Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Pooled Funds Cash plus Property Private equity Infrastructure Commodities Total Beginning balance at January 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . partnerships and hedge funds and 43% Global equity pooled fund. . . . . . . . . . . . . . . . . . . . . . . . . F-42 $ 3 3 3 4 4 20 . sales. . . . . . partnerships and hedge funds. . . . . . Accumulated benefit obligation . . . . . . . . Pension Plans December 31. . . Pension Plans 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchases. . 2013 . . 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Actual benefits payments may differ from expected benefit payments. . at December 31. . . . . . . . . The ABO and fair value of assets relating this plan were $53 and $49. . . . . . . . . . . . . . . . $— — — $60 53 49 The Company expects to make total contributions of approximately $1 in 2011 in respect of all pension plans. . . . . . . . . . 2010. . . . . . . . . 2010 and 2009. . . . . . Fair value of plan assets . . . . . . and settlements . . . . . . . . . . . . . . . . . . . . Benefit Payments The following table summarizes expected benefit payments from the Company’s various pension plans through 2020. sales. . . 2010 . . . . . . . the ABO of the GCUK Railway Pension Plan exceeded the fair value of the GCUK Railway Plan’s assets by $4. . 2009 . . . . . . . . . . . . . 2015 . . . . . . . . None of the Company’s pension plans’ ABO exceeded the fair value of their respective pension plans assets at December 31. . . . . . .

the Company makes a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. . .S. . . Estimates of reasonably possible losses may change from time to time and actual losses may be materially different from estimated amounts.18. . . . AT&T’s local exchange carrier affiliates commenced an action against certain U. AT&T Corp. . . . Further. . Management believes the carrying value of other debt approximates fair value as of December 31. . . Plaintiffs alleged damages in the amount of approximately $20 for the time period from February 2002 through August 2004. . . . . rulings. . where it is probable that a liability has been incurred and there is a range in the expected loss and no amount in the range is more likely than any other amount. restricted cash and cash equivalents. . 2011. . . . .” terminated long distance traffic to avoid the payment of interstate and intrastate access charges. . . . the Company accrues at the low end of the range. . . . . litigation is inherently unpredictable and it is possible that cash flows or results of operations could be materially and adversely affected in any particular period by the unfavorable developments in. . . . . . . . 2010 2009 Carrying Fair Carrying Fair Amount Value Amount Value 12% Senior Secured Notes . through certain unnamed intermediaries characterized by Plaintiffs as “least cost routers. 2004. accrued expenses and obligations under capital leases approximate their fair (see Note 2. . . . . . . . . . and other information and events pertaining to a particular case. . . . . . 5% Convertible Notes . settlements. . GCUK Senior Secured Notes . . 2010 and 2009. . . . . . . . . . District Court for the Eastern District of Missouri. In accordance with the accounting for contingencies as governed by ASC Topic 450. . . (SBC Communications) Claim On November 17. . . . . . . . . . . . . The fair values of the Company’s debt are based on market quotes and management estimates. . . Although the Company believes it has accrued for the following matters in accordance with ASC Topic 450. . . . 9% Senior Notes . 2010 devaluation of the Venezuelan bolivar by the Venezuelan government). . . . . . These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations. F-43 . . . . .S. . . . . CONTINGENCIES AND OTHER Contingencies $737 431 150 — 20 $846 444 150 — 20 $735 441 — 130 26 $816 441 — 139 26 Amounts accrued for contingent liabilities are included in other current liabilities and other deferred liabilities at December 31. . FINANCIAL INSTRUMENTS The carrying amounts for cash and cash equivalents. . . . the parties executed a Settlement and Release Agreement settling this and other claims between the parties on terms that are not material to the Company. . . . . . . . advice of legal counsel. . . . . . . . . one or more of these contingencies. “Basis of Presentation and Significant Accounting Policies” regarding the January 12. . The complaint and amended complaint alleged that the Company. . . . . . . . . . with respect to loss contingencies. . . 19. . . respectively. . . or resolution or disposition of. . The following is a description of the material legal proceedings and claims involving the Company commenced or pending during 2010. . . On January 5. . . . The fair values of our debt are as follows: December 31. subsidiaries of GCL and other defendants in the U. . . . . . COMMITMENTS. . . . . Other debt . . . . . . . . . accounts receivable. . . . . . . . . . 2010 and 2009. .

By agreement between the parties. The Company believes responsibility for the asserted claim rests entirely with the Company’s former subsidiary. In a memorandum and order dated September 10. However. but rejected by the Court of Appeals for the Seventh Circuit in 2004. malice. District Court for Massachusetts a motion for class certification and for approval of the proposed settlement. Qwest Rights-of-Way Litigation A large portion of the Company’s North American network comprises indefeasible rights of use purchased from Qwest Communications Corporation on a fiber-optic communication system constructed by Qwest within rights-of-way granted to certain railroads by various landowners. In 2002. penalty and interest based upon a tax examination conducted during 2004 by the Peruvian tax authorities F-44 . a proposed settlement was submitted to the U. The complaint alleges that the railroads had only limited rights-of-way granted to them that did not include permission to install fiber-optic cable for use by Qwest or any other entities. intentional wrongdoing. Qwest has appointed defense counsel to protect the Company’s interests. the Company could lose its ability to operate large portions of its North American network.S. and Qwest has reaffirmed this indemnification obligation. one of the Company’s Peruvian subsidiaries received a number of assessments for tax. plaintiffs also request an award of punitive damages.. willful or wanton conduct and/or reckless disregard for the rights of the plaintiff landowners.S. violates the terms of a Special Use permit issued by the National Oceanic and Atmospheric Administration (“NOAA”). The action seeks actual damages in an unstated amount and alleges that the wrongs done by the Company involve fraud. among other defendants. if the plaintiffs in such lawsuits were to prevail. A number of the plaintiff groups then requested the Court to modify its decision. 2002 bankruptcy filing were discharged in accordance with the Company’s Plan of Reorganization. 2009. a former subsidiary of the Company (“PCL”). In response. The Company made a demand of Qwest to defend and indemnify the Company in the lawsuit. 2002 asserting that an undersea cable owned by Pacific Crossing Ltd. As a result. If the plaintiffs were to prevail. Multiple attempts have been made to settle the above class action lawsuit and many similar class action lawsuits that have been pending against Qwest in other courts regarding the rights of way issue. the parties to the various class actions reached preliminary agreement to settle all of the pending cases and the parties submitted to the U. The claim was paid by the Creditors’ Committee in 2009 and the claim has been expunged. the Court reiterated its holding that the Court lacked subject matter jurisdiction over the claims and dismissed the case. Qwest could be forced to breach its contractual obligations to provide the Company with the aforementioned indefeasible rights of use.Claim by the U. The plaintiffs’ claims against the Company relating to periods of time prior to the Company’s January 28. District Court for the Northern District of Illinois and was preliminarily approved by the District Court. Although the Company is not currently a defendant in any pending class action lawsuits involving the Qwest network.S. denied final approval of the settlement and dismissed the case in its entirety. Department of Commerce (the “Commerce Department”) on October 30. In a revised memorandum and order dated December 9. Peruvian Tax Audit Beginning in 2005. a purported class action was commenced on behalf of such landowners in the U. 2009. The District Court granted preliminary approval of the settlement and a number of objections to the settlement were filed. In May 2001. During 2008. District Court for the Southern District of Illinois against Qwest and three of the Company’s subsidiaries.S. Department of Commerce A claim was filed against GCL and certain of its subsidiaries in the Company’s bankruptcy proceedings by the U. In 2009. the Plan of Reorganization preserved plaintiffs’ rights to pursue any postconfirmation claims of trespass or ejectment. the Company believes that it would be entitled to indemnification from Qwest for any losses under the terms of the IRU agreement under which the Company originally purchased this capacity. the District Court concluded that it did not have subject matter jurisdiction over the claims.S. NOAA agreed with the Global Crossing Creditors’ Committee to accept an allowed unsecured claim of $2 in the Global Crossing bankruptcy.

The asserted claims aggregate approximately $50. which is the highest administrative authority. breach of employment contracts. Objections were filed on behalf of Impsat Brazil arguing that the Argentine exporter (Corning Cable Systems Argentina S. including potential interest and penalties. Impsat Brazil filed objections to these assessments. the São Paulo tax authorities issued tax assessments against Impsat Brazil for the collection of Tax on Distribution of Goods and Services (“ICMS”) supposedly due on the lease of movable properties (in the case of the December 2004 and March 2009 assessments) and the sale of internet access services (in the case of the April 2009 assessment) by treating such activities as the provision of communications services. thereby confirming the assessments. for which ICMS tax actually applies. $7 in connection with value-added taxes (VAT) in connection with the import of services for calendar years 2001 and 2002. unpaid vacation pay. Appeals were filed in September 2006 and July 2007 in the Tax Court. However. Employee Severance and Contractor Termination Disputes A number of former employees and third-party contractors have asserted a variety of claims in litigation against subsidiaries within the GC Impsat Segment for separation pay. pension benefits. fines. severance. The objections to the March and April 2009 assessments are still pending final administrative decisions. The SUNAT examiner took the position that the Company incorrectly documented its importations and incorrectly deducted its foreign exchange losses against its foreign exchange gains on loan balances. the total assessments have effectively increased to $69. The notices informed Impsat Brazil that the taxes were levied because a specific document (Declaração de Necessidade—“Statement of Necessity”) was not provided by Impsat Brazil at the time of importation. due to the amount involved. an unfavorable administrative decision was issued. The Company has asserted defenses to these claims in the court proceedings denying liability and estimates that the range of loss that could reasonably be expected to result from these claims is between $9 and $17. respectively. the Brazilian tax authorities of the States of Parana and São Paulo. During August 2006 and June 2007 SUNAT rejected the Company’s administrative claims. Including penalties and interest. plus fines and interest that amount to approximately $10. issued two tax infraction notices against Impsat’s Brazilian subsidiary for the collection of the Import Duty and the Tax on Manufactured Products. The Tax Court is currently reviewing the September 2006 appeal. $16 in connection with the disallowance of VAT credits for periods beginning in 2005 and $1 for income tax in connection with foreign exchange deductions claimed during calendar year 2002. attorneys fees and statutorily mandated inflation adjustments) as a result of their separation from the Company or termination of service relationships. consisting of $3 for income tax withholding in connection with the import of services for calendar years 2001 and 2002. In the case of the São Paulo infraction notice. arguing that the lease of assets and the provision of internet access are not communication services subject to ICMS. The total amount of the asserted claims. these assessments amount to approximately $36.(SUNAT) for calendar years 2001 and 2002. The Company challenged the tax assessments during 2005 by filing administrative claims before SUNAT. property damages. the case was remitted to official compulsory review by the Federal Taxpayers Council. commissions. was $27. Due to accrued interest and foreign exchange effects. March 2009 and April 2009. F-45 . In the case of the Parana infraction notice. a favorable first instance decision was granted. At this time the Company cannot estimate the loss or range of loss that could reasonably be expected to result from this matter.) complied with the MERCOSUR rules. In December 2004. and the Company will appeal such decision in court. Brazilian Tax Claims In November 2002 and in October 2004. moral damages and related statutory penalties. and the Company will appeal such decision. The objection to the December 2004 assessment was rejected in the State Administrative Court. unpaid performance bonuses.A. in breach of MERCOSUR rules. costs and expenses (including accrued interest.

for improperly blocking international traffic. The Company notified the customer that the Company would be raising its rates for certain of the services and filed a motion with the bankruptcy court seeking additional adequate assurance for the rate change. The Company estimates that $9 is the maximum loss that the Company could reasonably be expected to incur as a result of these matters. Customer Bankruptcy Claim During 2007 one of the Company’s U.A. the National Telecommunications Commission of Paraguay (“CONATEL”) commenced separate administrative investigations against a joint venture (“JV 1”) between GC Impsat’s Argentine subsidiary and Electro Import S.A. The lower end of the customer’s most recent damage estimate is approximately $150. 2009.” and the customer filed an amended answer. the Court issued an opinion holding that the agreement did not permit the Company to increase the rates in the manner it did and that the Company: (a) breached the sales contract in so doing. The Court established January 15. On January 14. The Court did. 2011. and another joint venture (“JV 2”) between GC Impsat’s Argentine subsidiary and Loma Plata S. so called “ANI stripping. subsidiaries commenced default and disconnect procedures against a customer for breach of a sales contract for termination of international and domestic wireless and wireline phone service based on the nature of the customer’s traffic. which is still pending. the customer filed for bankruptcy protection. and (b) was therefore not entitled to additional adequate assurance or an order terminating service. 2008. retained the adversary proceeding (including the customer’s counterclaim). While the final outcome F-46 . On December 26. the Company terminated service to the customer. The customer amended its counter claims to assert claims for breach of contract based upon the rate increase. thereby barring the Company from taking further disconnection actions against it. or an order allowing the Company to terminate the customer’s service. Paraguayan Government Contract Claim In 2005 and 2003. JV 1 and JV 2 have asserted various defenses in pending administrative proceedings relating to these matters.S. Both administrative investigations involve alleged breaches by the joint ventures of their obligations under government contracts relating to the installation and operation of public telephones and/or phone booths in Paraguay and under the regulatory licenses under which they operate. 2008) and to assert other defenses. the Company filed a motion for summary judgment asserting that the customer is not entitled to recover any damages (other than those based on rescission-type theories) because it is precluded by the limitation of liability provisions in the contract and applicable law. the customer was prohibited from assuming the contract in its reorganization proceedings. 2011. The Company commenced an adversary proceeding in the bankruptcy court. for violations of the Communications Act of 1934 and for related tort-based claims. Briefing on this motion is continuing and a hearing is scheduled for March 17. however. permit the Company to amend its complaint to plead a rescission claim (which was filed on July 14. asserting a claim for damages for the customer’s alleged breaches of the contract and for a declaration that. On July 3. The Court dismissed the customer’s bankruptcy case by order dated November 25. The customer filed several counterclaims against the Company alleging various breaches of contract for attempting improperly to terminate service. After the process was begun. which rendered the contract highly unprofitable to the Company. The Company amended its complaint to include allegations relating to the manipulation of traffic data.The Company believes there are reasonable grounds to have all of the Brazilian tax assessments cancelled and estimates that the range of loss that could reasonably be expected to result from these assessments is between nil and $9. and it has alleged damages substantially in excess of that amount. as a result of these breaches. 2011 as the cut-off date for all discovery. respectively. 2009. except for a few depositions that are being completed. affirmative defenses and counterclaims.

. the Company’s Brazilian subsidiaries received collection notifications from the municipality of Rio de Janeiro regarding fees in the amount of approximately $80 for the use of public space (including both air space and underground space) relating to ducts containing telecommunications cables. From time to time in the ordinary course of business. Brazilian Municipal Telecommunications Services Fees In April and May 2010. . . . 2010. The following table summarizes the Company’s purchase commitments at December 31. . . . F-47 . An appeal has been filed requesting a review by the full Brazilian Supreme Court. . including the lack of objective criteria for the calculation of the fees. $230 Third-party maintenance services . in certain cases based on usage. including defenses based upon the limitation of liability provisions in the contract. Separately. 309 Purchase and other obligations . Some of these access vendor commitments require the Company to maintain minimum monthly and/or annual billings. . the Company has purchase commitments with third parties that require it to make payments for maintenance services for certain portions of its network through 2026. . . . . . On August 26. . . . In addition. This request was granted as to one of the Company’s Brazilian subsidiaries that had been assessed a fee of $70. . and the Company expects the request to be granted as to the other Brazilian subsidiary that had been assessed the remaining $10 fee. . . none of the Company’s total purchase commitments were commitments of the GCL parent company. . The Company is challenging the fees on multiple grounds. $781 $119 66 150 $335 $ 92 76 38 $206 $19 34 26 $79 $ — 133 28 $161 As of December 31. Third Party Maintenance and Other Purchase Commitment Obligations The Company has purchase commitments with third-party access vendors that require it to make payments to purchase network services. . . . . GCL will provide commercial guarantees in favor of third parties in support of its subsidiaries’ purchase commitments and payment obligations. 2010: Less than 1 year (2011) 1-3 years (2012-2013) 3-5 years (2014-2015) More than 5 years Total Cost of access services . . the existence of prior court injunctions barring collection of the fees and the unconstitutionality of the assessment. a justice of the Brazilian Supreme Court ruled unconstitutional a decree of the municipality that purported to tax the use of public air space and subsoil for the installation and passage of equipment utilized to provide telecommunication services. . . Further. . . the Company requested the municipality to suspend collection of the fees until final resolution of the asserted objections. Based on subsequent developments and analyses conducted after receipt of the collection notices. 2010. . the Company believes it has good defenses to limit substantially the amount of damages recoverable by the customer. 242 Total . Commitments Cost of Access. . . .of this matter is uncertain. . . the Company does not at this time believe that this matter can reasonably be expected to result in a material loss. . . capacity and telecommunications equipment through 2015. . the Company has purchase commitments with other vendors. . . . . . . .

respectively. . . . .Operating leases—The Company as Lessee and Lessor The Company has commitments under various non-cancelable operating leases for office and equipment space. and $6 of co-location services from subsidiaries and affiliates of ST Telemedia. . . . . the Company accrued dividends of $4. . . . 2009 and 2008. . . . . 2012 . . . . . . . . . . . . . . . . 2011 . . . . . . . network capacity contracts and other leases. . . . . . $103 88 83 78 71 360 $783 $ 4 4 3 2 2 6 $21 Rental expense related to office and equipment space. . 2010 and 2009. . . (ii) the GC Impsat Segment. . . . RELATED PARTY TRANSACTIONS Commercial and other relationships between the Company and ST Telemedia During the years ended December 31. . . . . . . related to restructured properties (see Note 3). respectively. . . . 2009 and 2008 was $133. . . . . $5. 2009 and 2008 was $5. . the Company had approximately $27 and $24. . . The Company’s CODMs assess performance and allocate resources based on three separate operating segments which management operates and manages as strategic business units: (i) the GCUK Segment. . . . . . 2009 in the accompanying consolidated balance sheets. . . 2013 . F-48 . . . . and 2008. . Sublease income for the years ended December 31. . automobiles. . . . . Thereafter . . The Company purchased capital equipment of $1. . . . . . . . . respectively. . . . . . respectively. . . . 2009. . . . . Also. . . . . . . of telecommunications services to subsidiaries and affiliates of the Company’s indirect majority shareholder and parent company. excluding obligations and receipts. 2010. equipment rentals. . . . . 20. . . 2009 and 2008 the Company provided approximately $1. . respectively. . . 2010. . . . . . . . . . . . . . $127 and $133. . . . . . The amounts due to ST Telemedia and its subsidiaries and affiliates at December 31. . . . . . . . . . 2015 . . . nil. . . automobiles. . and (iii) the ROW Segment. . . . . . . . . during the years ended December 31. . Additionally. . . $4 and $4. . . . . Total . . . during the years ended December 31. . . . Estimated future minimum lease payments on operating leases and future minimum sublease receipts. . . As of December 31. . . . . . . . 2010. . . . and nil and nil due from ST Telemedia and its subsidiaries and affiliates. . . . . 2010. . . . . 2014 . . 2010. . 21. . . . . . are approximately as follows: Future Minimum Lease Payments Future Minimum Sublease Receipts Year Ending December 31. . . . related to preferred stock held by affiliates of ST Telemedia. . . $1 and nil from subsidiaries and affiliates of ST Telemedia during the years ended December 31. . . . equipment rentals and other leases for the years ended December 31. . . . . . 2010 and in “other deferred liabilities” at December 31. . . . . . . . $8 and $7. . . . . . . . ST Telemedia. . . . . . . . . . . . . and nil. . . . . . . . . . . . . respectively. . . . . . . . . . . due to ST Telemedia and its subsidiaries and affiliates. . . 2010. 2009 and 2008 the Company received approximately $7. . respectively. . Additionally. . . . . . . . . SEGMENT REPORTING Operating segments are defined in ASC Topic 280 as components of public entities that engage in business activities from which they may earn revenues and incur expenses for which separate financial information is available and which is evaluated regularly by the Company’s chief operating decision makers (“CODMs”) in deciding how to assess performance and allocate resources. . 2010 and 2009 primarily relate to dividends accrued on the GCL Preferred Stock. the Company has various sublet arrangements with third parties. . and are included in “other current liabilities” at December 31. . .

The ROW Segment represents all the operations of Global Crossing Limited and its subsidiaries excluding the GCUK and GC Impsat Segments and comprises operations primarily in North America. other non-operating income or expense items. The GC Impsat Segment is a provider of telecommunication services including IP. as defined by the Company. In addition. OIBDA does not include certain significant items such as depreciation and amortization. income taxes. Latin America. voice. preferred stock dividends. data center and information technology services to corporate and government clients in Latin America. There are material limitations to using non-U.S. and may not be comparable to those other measures. in that it excludes depreciation and amortization. is operating income (loss) before depreciation and amortization. It excludes the effect of items associated with the Company’s capitalization and tax structures. and not as a substitute for.S. GAAP financial measures. IP and voice services to government and other public sector organizations. The services provided by all the Company’s segments support a migration path to a fully converged IP environment. as calculated in accordance with U. IP and voice products. The CODMs measure and evaluate the Company’s reportable segments based on operating income (loss) before depreciation and amortization (“OIBDA”). interest expense. serving many of the world’s largest corporations and many other telecommunications carriers with a full range of managed telecommunication services including data. and gains and losses on pre-confirmation contingencies. The Company’s calculation of OIBDA may differ from similarly titled measures used by other companies. other measures of financial performance reported in accordance with U. major corporations and other communications companies in the U.K. and to make resource allocation decisions. with smaller operations in Europe. interest income. including data. as opposed to the cash impacts of capital expenditures made in recent periods. distributions or other discretionary uses. OIBDA should be considered in addition to. Such excluded expenses primarily reflect the non-cash impacts of historical capital investments. OIBDA differs from operating income (loss). The Company believes that OIBDA is a relevant indicator of operating performance. OIBDA. GAAP. OIBDA provides the Company with an indication of the underlying performance of its everyday business operations. OIBDA is an important part of the Company’s internal reporting and planning processes and a key measure to evaluate profitability and operating performance. and of other items not associated with the Company’s everyday operations. GAAP and reflected in the Company’s consolidated financial statements. and a portion of the Asia/Pacific region. OIBDA does not give effect to cash used for debt service requirements and thus does not reflect available funds for reinvestment. Additionally. make comparisons between periods.The GCUK Segment is a provider of managed network communications services providing a wide range of telecommunications services. interest expense and income taxes.S. especially in a capitalintensive industry such as telecommunications. F-49 . This segment also includes our subsea fiber optic network. such as interest income.

. . . . . . . . . . . . . . . . Intersegment revenues GC Impsat . . Income (loss) applicable to common shareholders . . . . . . . . . . Interest expense . .599 $ $ 7 11 18 $ 477 569 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .593 (30) $2. . . . . .536 $ $ 9 15 24 $ 599 475 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .609 $ 470 504 1. . . . . . . . . . . . . . . . . . . . . . . . Total consolidated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 2008 OIBDA GCUK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ROW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . . . . . . . .571 $2. . 2010 2009 2008 Revenues from external customers GCUK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net . . . . . . . . . . .586 (24) $2. . . . . Other expense. . . . . . . . . . . . . . . . . . . GC Impsat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .536 $ 599 482 1. . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .609 $ $ 9 21 30 $ 470 495 1. . . . . . . . . . . . ROW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 477 560 1. . . . . Operating income (loss) . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $100 (64) 36 7 (56) (9) — — $ (22) $176 (82) 94 2 (22) (26) 5 — $ 53 $ 124 (191) (67) 20 (140) (16) — (4) $(207) $— — — (27) 27 — — — $— $ 400 (337) 63 2 (191) (51) 5 (4) $(176) F-50 . . . Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total consolidated . . . . . . . . . . . . . . . . . . . . . . 2010 GC Impsat ROW Eliminations Total Consolidated OIBDA . . . . . . . . . . . . . . . .525 $2. . GC Impsat . . . . . . . . . . . . . Less: intersegment revenues . . . . . . . . . . . . . . . . . . Total segment operating revenues GCUK . .Segment Information The following tables provide operating financial information for the Company’s three reportable segments and a reconciliation of segment results to consolidated results. . . . . . . . . . Preferred stock dividends . . ROW . . . . . . .572 $2. . . . . . . . . . . . . . . . . . . . . . . . . .599 Year Ended December 31. . . . . . . GC Impsat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $100 176 124 $400 $ 93 160 89 $342 $134 138 1 $273 A reconciliation of OIBDA to Income (Loss) Applicable to Common Shareholders follows: GCUK Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Benefit for income taxes . . . . . . . . . . . . . . . . Total consolidated . . . . . . . . . . . . . . . . . . . .536 (18) $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ROW . . .

. . . . . . . . . . . Other income (expense). . . . . Loss applicable to common shareholders .062 (574) $2. . . . . . . net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Income (loss) applicable to common shareholders . . . . . . . . . . . . . . . . . . . . .349 2010 December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .310 $ 601 807 1. . . . . . 2009 2008 $(215) 2010 Total Assets GCUK . . . . . . Interest income . . . . . . . . . . . . . . . . . . . . . . . . . Total consolidated capital expenditures . . . . . . $ 564 845 1. . . . . . . . . . . . . . . . . . . . . . . . . Interest expense . $134 (84) 50 8 (65) (57) — (1) — $ (65) $138 (81) 57 3 (35) (20) 4 (17) — $ (8) $ 1 (161) (160) 6 (83) 51 6 (31) (4) $— — — (7) 7 — — — — $— $ 273 (326) (53) 10 (176) (26) 10 (49) (4) $(288) December 31. . . . . . . . . . Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . .488 $ 656 693 1. . . . Interest expense .GCUK Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net . . . . . . . . Less: Intercompany loans and accounts receivable . . . Other income (expense). . . . . . . . . Operating income (loss) . . . . . . . . . . . $ 93 (66) 27 8 (53) 18 (1) — $ (1) $160 (87) 73 6 (33) — 2 — $ 48 $ 89 (187) (98) 9 (90) (7) (2) (4) $(192) $— — — (16) 16 — — — $— $ 342 (340) 2 7 (160) 11 (1) (4) $(145) GCUK Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total consolidated assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total segments . . $ 23 60 84 $ 19 68 87 $ 42 56 94 $ 167 $ 174 $ 192 F-51 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GC Impsat . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009 GC Impsat ROW Eliminations Total Consolidated OIBDA . . ROW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Benefit (provision) for income taxes . . . . . . . . . . . . . . .369 2. Operating income (loss) . . . . . . . . . . . . . . . .430 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .718 (369) $2. . . . . . . . . . . . . . . . . . . . . . . . . . ROW .839 (529) $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GC Impsat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2008 GC Impsat ROW Eliminations Total Consolidated OIBDA . . . . . . . . . . Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .654 3. Depreciation and amortization . Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . Net gain on pre-confirmation contingencies . . . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009 2008 Purchases of Property and Equipment GCUK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . .609 $1. . . . ROW . . 2010 2009 2008 Revenue: Data Services . . . . . . . . . . . . . . . Other countries . . . .642 795 172 $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Eliminations include intersegment eliminations and other reconciling items. . . . . . . . . . . . .536 $1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 Restricted Cash ROW . . . 2010 2009 Unrestricted Cash GCUK . . . . . . . . . . The following table presents revenue and long-lived asset information for geographic areas: Year Ended December 31. . . . . . . . . 2010 2009 2008 Revenue(1): United States . . $1. . . . . Total consolidated unrestricted cash . . . . . . . . . . . . . . . . . . . . . . . . . $ 76 170 126 $372 $ 60 154 263 $477 December 31. .548 893 158 $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Consolidated worldwide . . . . . . . . . . . . . . . . . . . . . . Collaboration Services . . . . . . . . . . . . . . . . Consolidated worldwide . . . . . . . Total consolidated restricted cash . . . . . . Longlived assets are based on the physical location of the assets. . . .328 588 620 $2. . . .599 Year ended December 31. . . . . . . . . . .599 F-52 . . . . . . . . . . . . . . . . .547 826 163 $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ 9 9 $ 16 $ 16 The Company accounts for intersegment sales of products and services and asset transfers at current market prices. . . . . . . . . . . . . . . . . . . . . . United Kingdom .305 714 580 $2. . . . . . . . . . . . .609 $1. Geographic Information Company information provided on geographic sales is based on the order location of the customer. .536 $1. . . . . . . . . . . . . . . . . . . . . . . . . Voice Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .December 31. . . . . $1. . . . . . . . . . . .337 597 675 $2. . . . . . . . . . . GC Impsat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . net of cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . International waters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other . . . . . . . . . . . . . (1) $ 325 241 140 473 227 $1. . . . . . . . . . . . . . . . .478 (2) There were no individual customers for the years ended December 31. . . . . Consolidated worldwide . . . . . . . . . . . $ 42 34 8 (1) $ 7 $ — — — — $ — $ 59 $ — — — — $ — $ 48 $ 56 Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $157 $ 17 $117 $ 16 $138 $ 13 F-53 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .December 31. . . . . . . . . 2010 2009 2008 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid for interest and income taxes: Cash paid for interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2010 2009 Long-lived assets(2): United States . . . . . . . . . . SUPPLEMENTAL INFORMATION ON NON-CASH FINANCING ACTIVITIES: Capital lease and debt obligations incurred . . . . . . . . . . . Other countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cash paid for income taxes . . . . . . . . . . . . 2009 and 2008 that accounted for more than 10% of consolidated revenue. . . 2010. . . . . . . . . . . . . .406 $ 347 281 161 491 198 $1. . . . . . . . . . . . . . . . . . . . . . . . United Kingdom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Long-lived assets include property and equipment and intangible assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Business acquisition. . . . . . . . . . . . . . . . . . . . 22. . . . . . . . . . . SUPPLEMENTAL CASH FLOW INFORMATION Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Less liabilities assumed . . . . . . . . . Net assets acquired . . . . . . . . . . . 2010 2009 2008 SUPPLEMENTAL INFORMATION ON NON-CASH INVESTING ACTIVITIES: Fair value of assets acquired . Less cash acquired .

.114 During the fourth quarter of 2010. .487 March 31 2009 Quarter Ended June 30 September 30 December 31 Revenue .904. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Selling. Income (loss) applicable to common shareholders per common share. Loss per share: Loss applicable to common shareholders per common share. 2010 and 2009. . . . Real estate. . . . . . . . . . . . . . Shares used in computing basic and diluted loss per share . .153. .923. . . . . . . . . . . . . . . . . . . Income (loss) per share: Income (loss) applicable to common shareholders per common share. .923. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ Cost of access . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12) $ 60. . . . . . . . Depreciation and amortization . . .23) $ 60. . . . . . . . . . . . . . . . . . . .99) $ (0. . . . . . . . . .503 0. . .04) $ 56. . .853 (0. . . . . . . Loss applicable to common shareholders . . . . . . . . . . . . . . . .135. . . . . . . .153. . . . network and operations . . . . .540.415 0.267. . . Net loss (1) (2) . . .227 (0. . . . . . . . . . . . . . . . . . . . . Cost of equipment and other sales . QUARTERLY FINANCIAL DATA (UNAUDITED) The following tables present the unaudited quarterly results for the years ended December 31. .04) $ 56. . . . . . . . . . (1) 609 $ (286) (97) (24) (23) (430) (104) (79) (4) (58) (59) 633 $ (285) (98) (27) (22) (432) (108) (82) 11 27 26 643 $ (288) (106) (26) (23) (443) (109) (89) 2 (73) (74) 651 (300) (105) (26) (30) (461) (107) (90) (7) (37) (38) $ (1. . . . . . . . . . . . . . . . . Third party maintenance . . . . . . . .493. . . . Net income (loss)(3) (4) . . Operating income (loss) . . . . F-54 . . . . . .63) 60. . . .434. . . . . . . . . . . . . . basic and diluted . . . . . . . . . . . . . general and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .559 (0. . . . . . .477. . Cost of equipment and other sales . . . . . . . . . . . . . . . . . . . . .43 59. . . . . . . . . . . Selling. . . . . general and administrative . the Company recorded a charge of $6 in other income (expense). . . . . . . . . . Depreciation and amortization .63) 60. . . .114 (0. . . . Shares used in computing basic income (loss) per share . . . . . . .02) 60. . .415 $ (1. diluted (5) .34 78. .579 60. . . . . . . . . . . . . . . . . . . . . .23) $ 60.23. Third party maintenance . .571 $ (1. . . . . . Total cost of revenue . . . . Shares used in computing diluted income (loss) per share . . Income (loss) applicable to common shareholders . . . . . . . network and operations . . . . . . . . . . . . . .79) $ 60. . . . . . . . . . . . . basic . . net in connection with the early extinguishment of the 5% Convertible Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 648 $ (305) (99) (27) (24) (455) (116) (88) (11) (119) (120) 630 $ (276) (103) (26) (26) (431) (106) (82) 11 (47) (48) 648 $ (289) (101) (25) (25) (440) (99) (82) 27 (6) (7) 683 (289) (105) (26) (32) (452) (110) (85) 36 — (1) $ (1. Total cost of revenue . Real estate. . . . . . . . . .135. . . . . . . . . . . . . . . . . . . . . . . . . . .853 $ (1. . . . . . March 31 2010 Quarter Ended June 30 September 30 December 31 Revenue . . Operating income (loss) . . $ Cost of access .

and were not registered under the Securities Act. Intercompany eliminations are shown in a separate column. GUARANTEES OF PARENT COMPANY DEBT On September 22. the below financial information is equally applicable to the obligors on the Original 9% Senior Notes since the obligors on the Original 9% Senior Notes and the 12% Senior Secured Exchange Notes are identical. 2015 (the “Original 12% Senior Secured Notes”). 2009. The condensed consolidating financial information below in respect of the obligors on the 12% Senior Secured Exchange Notes has been prepared and presented pursuant to Rule 3-10. During the fourth quarter of 2009. The column labeled Parent Company represents GCL’s stand alone results and its investment in all of its subsidiaries accounted for using the equity method. The Original 9% Senior Notes which are not registered under the Securities Act are guaranteed by the same group of direct and indirect subsidiaries of the Company that guarantee the 12% Senior Secured Exchange Notes. GCL is required to provide the financial information in respect of those notes set forth under Rule 3-10 of Regulation S-X. The Original 12% Senior Secured Notes were guaranteed by a majority of the Company’s direct and indirect subsidiaries (the “Guarantors”). Preferred stock dividends included in the dilutive calculation were $1 for the three months ended June 30. As required under a registration rights agreement. In connection with the registration of the 9% Senior Exchange Notes and related guarantees. GCL issued $150 in aggregate principal amount of the 9% Senior Notes due November 15. the Company is required to register an identical series of notes (the “9% Senior Exchange Notes”) with the SEC and to offer to exchange those registered 9% Senior Exchange Notes for the Original 9% Senior Notes. GCL will be required to provide the financial information in respect of those notes set forth under Rule 3-10. the Company recorded a $20 reduction in its valuation allowance against Brazilian deferred tax assets which was recorded in provision for income taxes. net in connection with the early extinguishment of the GC Impsat Notes and Term Loan Agreement. On November 16. 2019 (the “Original 9% Senior Notes”). Although Rule 3-10 will not apply to the Original 9% Senior Notes until the exchange offer is completed. “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered” (“Rule 3-10”). the Company recorded a $34 reduction in its valuation allowance against deferred tax assets which was recorded in provision for income taxes. 24. The 9% Senior Exchange Notes will also be guaranteed by the Guarantors.(2) (3) (4) (5) During the fourth quarter of 2010. During the third quarter of 2009. The Guarantors and the non-Guarantor subsidiaries are presented in separate columns and represent all the applicable subsidiaries on a combined basis. 2009. GCL issued $750 in aggregate principal amount of 12% Senior Secured Notes due September 15. In connection with the registration of the 12% Senior Secured Exchange Notes and related guarantees. The sum of the quarterly net loss per share amounts may not equal the full-year amount since the computations of the weighted average number of shares outstanding for each quarter and the full year are made independently. Pursuant to a registration rights agreement to which the Company is a party. F-55 . All $750 aggregate outstanding principal amount of Original 12% Senior Secured Notes were exchanged for 12% Senior Secured Exchange Notes in the exchange offer. the Company recorded a charge of $29 in other income (expense). the Company registered an identical series of notes (the “12% Senior Secured Exchange Notes”) under the Securities Act with the SEC and offered to exchange those 12% Senior Secured Exchange Notes for the Original 12% Senior Secured Notes. The 12% Senior Secured Exchange Notes are also guaranteed by the Guarantors. 2010.

$ 2 — — 325 — 327 — — — (494) 653 29 $ 261 4 243 184 51 743 5 834 178 (180) 107 55 $1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Long term debt . 2010 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated ASSETS: Current assets: Cash and cash equivalents . SHAREHOLDERS’ DEFICIT: Total shareholders’ deficit . . . . . . . . . net of accumulated depreciation . . Deferred revenue . . . . . . Total current assets . . net . . . . . Restricted cash and cash equivalents— current portion . . . . . . . . Accounts receivable. . Loans payable to affiliates .179 227 — — 108 $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other deferred liabilities . . . . . . . . . . . . . . . . . Total liabilities . . . Total liabilities and shareholders’ deficit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . net of allowances . .787 (477) $2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .236 (494) $1. . Accounts and loans receivable from affiliates . . . .310 $ 515 $ (883) $ 1 — 27 — — — 68 96 9 887 — — — 992 (477) $ 205 66 537 9 36 123 176 1. . . . . . . . .742 $ 109 — 81 233 41 464 — 345 49 — 54 24 $ 936 $ — — — (742) (1) (743) — — — 674 (814) — $ 372 4 324 — 91 791 5 1. . . . . . . . . . . . . . Other current liabilities . . . Obligations under capital leases—current portion . . . . . . . . . . . . . . . . . . . . . . Prepaid costs and other current assets . . Other assets . . . . . . . . . . . . . . .310 $ 515 $ 936 $ (883) F-56 . . . . . . . . . . . . . . . . Deferred revenue—current portion . . . . . . . . . . . . . . . . . . . Restricted cash and cash equivalents—long term . . . . . . . . . . . . . . . Intangible assets. . . . . . . . Obligations under capital leases . . . . . . . . . . . . . . . . . . .742 $ 91 12 178 18 15 61 132 507 98 415 19 67 10 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accounts and loans payable to affiliates . . . . . . . . . . . . . . . . . . . . . . . . Accrued cost of access . Short term debt and current portion of long term debt . . .311 72 338 53 2. . .013 — 1. . . . . . . . . .152 707 9 53 272 43 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .557) 674 $ 297 78 — 27 51 184 376 1. . . . . Total current liabilities . . . .116 (180) $ — — (742) — — — — (742) (814) — — (1) — (1. .Condensed Consolidated Balance Sheet Parent Company December 31. . . . . . Property and equipment. . . . Total assets . . Loans receivable from affiliates . . . . . LIABILITIES: Current liabilities: Accounts payable . . . . . Investments in subsidiaries . . . . . . . . . . . .

. . . . . . . . . SHAREHOLDERS’ DEFICIT: Total shareholders’ deficit . . LIABILITIES: Current liabilities: Accounts payable .084 713 7 66 262 45 2. . . . . Other deferred liabilities . . . . . . . Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . Property and equipment. . . . Accounts and loans payable to affiliates . . . . . . . . . . . Long term debt . . net . . . . . . . . . . . . . . . . . . . . . .488 $1. . . . . . . . . . . . . . . . . . . . . . . . Prepaid costs and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .280 198 — — 88 $2. . . . . . . . . . . . . . . . Short term debt and current portion of long term debt . . . .848 (360) $2. . . . . . . .488 $ 608 $1. .666 $ 97 13 155 34 13 61 148 521 131 423 24 72 19 1. . . . . . . . . . . Other assets . . . . . . . Loans receivable from affiliates . . . . . . . . . . . . . . . . . . . Intangible assets. .295 90 334 86 2. . . . . . . . . . . . . . . . . . . Total current assets . . . . . . . . . . . . . .487) 701 $ 312 87 — 37 49 174 384 1. . . . . . . . . . . . . . . . . . . . . . . .190 (190) $ — — (635) — — — — (635) (852) — — — — (1. . net of allowances . . . . . . . . . . . Restricted cash and cash equivalents—long term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accrued cost of access . . . . . . . . . . .000 $ (786) $ 4 — 30 — — — 39 73 8 865 — — 22 968 (360) $ 211 74 450 3 36 113 197 1. . . . . . . . . . . . . . . . . . . . Accounts and loans receivable from affiliates . Restricted cash and cash equivalents— current portion . . .177 (511) $1. . . . . . . . . . . . . . . . . . . . . . . . . . . . Total current liabilities . . . . . . . . . . . Deferred revenue—current portion . . . . . . . . . . . . . Total liabilities . . . . Obligations under capital leases . . . . . . . . . . . . . . . . . Total liabilities and shareholders’ deficit . . Obligations under capital leases—current portion . . . . . . . . . . . . . . . . . . . . . . . .043 — 1. . . . . . . . . net of accumulated depreciation . . . . . . . Other current liabilities . . . . . . . . . . . . . . . . . . Accounts receivable. . $ 95 — — 316 1 412 — 2 — (511) 678 27 $ 608 $ 293 9 241 77 54 674 7 891 145 (190) 94 45 $1. . .Condensed Consolidated Balance Sheet Parent Company December 31. . 2009 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated ASSETS: Current assets: Cash and cash equivalents . . . . . . Deferred revenue . . . . . . . . . . . . . . . . . .000 $ (786) F-57 . . Investments in subsidiaries . . . . . Loans payable to affiliates .666 $ 89 — 87 242 46 464 — 387 53 — 80 16 $ — — — (635) — (635) — — — 701 (852) — $ 477 9 328 — 101 915 7 1. . .

. . . . . . . . . . . . . . Gross margin .609 (1. .927 35 1. . Interest expense . . . . . . . . . . . . net . . . . . . Other income (expense): Interest income . .609 — 2. . . . . . . . . . . Loss before benefit (provision) for income taxes . . . . . . . . Loss applicable to common shareholders . . . . . . . . . . . Interest expense—affiliates . . . . . . . Depreciation and amortization . . . . . . . . . Selling. . . . . . . . . . . . . . . . . $ — — — (12) — (12) (12) (16) (2) (30) — — (114) — (6) (22) (172) — (172) (4) $(176) $ 1. . . Loss from equity investments in subsidiaries . . Interest income—affiliates . . . . . .Condensed Consolidated Statement of Operations Parent Company Year Ended December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . .317) (67) (1. . . . . . . . . . . . . Benefit (provision) for income taxes . . . . . . . . . Total revenue . . . . . . Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of revenue—affiliates . . . . . . . .778) — (1. . . . . . . .778) 831 (431) (337) 63 2 — (191) — (51) — (177) 5 (172) (4) $ (176) F-58 . . . . . . . . . . 2010 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Revenue—affiliates . . Total cost of revenue . . Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other expense. . . . . . . . . . . . . . .962 (1. . . . . . . . . .384) 578 (318) (235) 25 1 6 (17) (7) (34) (3) (29) 7 (22) — $ (22) $ 682 67 749 (449) (35) (484) 265 (97) (100) 68 1 7 (60) (6) (11) — (1) (2) (3) — $ (3) $ — (102) (102) — 102 102 — — — — — (13) — 13 — 25 25 — 25 — $ 25 $ 2. . . . . . . . . . . . . . . . . . . . . . . . Preferred stock dividends . . . . . . . . . . . . . . . . general and administrative . . Cost of revenue . . . . . . . . . . . . . . . . .

. . Total cost of revenue . . . Other income (expense): Interest income . . . . . . Intercompany debt forgiveness income (expense) . . . . . . . . . . . . . . . general and administrative . . . . . .904 (1. . . . . . . . . . . . . . . . . . . . Interest income—affiliates . . . . . . . . . . . . . . . . .876 28 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — — — (14) — (14) (14) (19) (1) (34) — — (64) — (13) — (29) (140) (1) (141) (4) $(145) $ 1. . . . . . . . . . . Gross margin . . . . . . .766) — (1. . . . . . . . . . . . . . . . . . . . .Condensed Consolidated Statement of Operations Parent Company Year Ended December 31. . . . Selling. . . . . . . Preferred stock dividends . . . . . . . Cost of revenue—affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest expense—affiliates . . .536 (1. . . . . .766) 770 (428) (340) 2 7 — (160) — 11 — — (140) (1) (141) (4) $ (145) F-59 . . . . . . Operating income (loss) . . . . . . Other income (expense). . . . Cost of revenue . . . . . . .373) 531 (292) (232) 7 6 4 (38) (7) 9 (32) 17 (34) 5 (29) — $ (29) $ 660 46 706 (425) (28) (453) 253 (117) (107) 29 1 7 (58) (4) 15 32 — 22 (5) 17 — $ 17 $— (74) (74) — 74 74 — — — — — (11) — 11 — — 12 12 — 12 — $ 12 $ 2. . . . . . . . . . . . . . . . . . . Total revenue . . . . . . Interest expense . . . . . . . . . . . . . . . . . . . . . Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . .327) (46) (1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Income (loss) before benefit (provision) for income taxes . . . . . . . . . . . . . . . . . . . . . Income (loss) from equity investments in subsidiaries . . . Benefit (provision) for income taxes . . Income (loss) applicable to common shareholders . . . . . . Revenue—affiliates . . . . 2009 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Revenue . . . net . . . . . . . . . . . . . . .536 — 2. . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .599 — 2. . . . . . . Other income (expense). . . . . . . . . . . . . . . Gross margin . . . . .835) 764 (491) (326) (53) 10 — (176) — (26) — — (284) — (284) — (284) (4) $(288) (156) 10 (146) (40) (186) — $ (186) (18) — (18) (9) (27) — $ (27) 213 — 213 — 213 — $ 213 (245) 10 (235) (49) (284) (4) $ (288) F-60 . . . . . . . . . . . . . . . . .332) (101) (1. . . . . . . 2008 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Revenue . . . . . Interest expense . . . . . . . . . . . . . .433) 401 (300) (203) (102) 6 2 (48) (5) 26 (8) (27) $ 785 101 886 (486) (20) (506) 380 (165) (122) 93 2 5 (74) (2) (50) 8 — $ — (121) (121) — 121 121 — — — — — (7) — 7 — — 213 $ 2. . . . . . . . . . . . . . . . $ — — — (17) — (17) (17) (26) (1) (44) 2 — (54) — (2) — (186) $ 1. . . . . . . . . . . . . Total cost of revenue . . . . . . . .814 20 1. . . . . . Other income (expense): Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net gain on pre-confirmation contingencies .835) — (1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of revenue—affiliates . . . . . . . . . . . . . . . Interest expense—affiliates . . . . . . . . . . . . . . . . . . . . . . . . Revenue—affiliates . . . . . . . . .Condensed Consolidated Statement of Operations Parent Company Year Ended December 31. Loss before pre-confirmation contingencies and provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of revenue . . . . . . . . . . . . . Selling. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net loss . . . . . Interest income—affiliates . . general and administrative . . . . . Operating income (loss) . . . . . . . . . . . . . . . . . . . Loss before provision for income taxes . . . . . . . . . . . . . . . . . . . . . . Loss applicable to common shareholders . . . . . . Loss from equity investments in subsidiaries . . . . Depreciation and amortization . . . . . . . . Total revenue . . . . . . . . . . . . . . Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . Provision for income taxes . . . . . . . . . . . . . net . . .834 (1. . . . . Intercompany debt forgiveness income (expense) . .599 (1. . . . . . .

. . . . . . . . . Genesis acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . beginning of year . . . . . . . Proceeds from affiliate loans . . . . . . . Cash flows provided by (used in) investing activities: Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proceeds from sale of marketable securities . . . . . net of cash acquired . . . . . . . Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . Net cash flows used in financing activities . . . . . . . . . end of year . . . . . . . . . . Purchases of marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net cash flows provided by (used) in investing activities . . . . . . . . . . . . . . . . . Finance costs incurred . . . . . . . . . . Cash and cash equivalents. . . . . Repayment of long term debt (including current portion) . . . . . . . . . . . . . . . . . Loans made to affiliates . . . . . . . 2010 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Cash flows provided by (used in) operating activities . . . . . . . . . Loan repayments from affiliates . . Cash flows provided by (used in) financing activities: Proceeds from short and long term debt . $(118) $ 214 $ 87 $— $ 183 — — — — (1) 26 — 25 (117) (10) (7) 8 (20) 8 8 (130) (50) — — — — — — (50) — — — — 21 (34) — (13) (167) (10) (7) 8 — — 8 (168) 150 — (144) (1) (6) 1 — — — — — (93) 95 $ 2 — (45) (20) (1) — — (1) 1 (26) (92) (24) (32) 293 $ 261 — (13) (15) — — — — 20 (8) (16) (1) 20 89 $109 — — — — — — — (21) 34 13 — — — $— 150 (58) (179) (2) (6) 1 (1) — — (95) (25) (105) 477 $ 372 F-61 . . . . . . . . . . . . . . . Proceeds from exercise of stock options . . Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Change in restricted cash and cash equivalents . . . . . . . . . . . . . . . . Repayment of loans from affiliates . Repayment of capital lease obligations . . . . . . . . . . . . Payment of employee taxes on sharebased compensation . . .Condensed Consolidated Statement of Cash Flows Parent Company Year Ended December 31. . . . . . . . . . . . Cash and cash equivalents. . . Premium paid on extinguishment of debt . . . . .

. . . . . . . . . . . 2009 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Cash flows provided by (used in) operating activities . . . . . . . . . . . . . . Finance costs incurred . . . . . . . . . . . . . . Net increase in cash and cash equivalents . . . . . . . . . Proceeds from sale of marketable securities . . . . Repayment of loans from affiliates . end of year . . . . . . . . . . Change in restricted cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Condensed Consolidated Statement of Cash Flows Parent Company Year Ended December 31. . . . . . . Payment of employee taxes on sharebased compensation . . . . . . . . . . . . . . . . Cash and cash equivalents. Net cash flows provided by (used in) investing activities . . . . Cash and cash equivalents. . . . $(276) $ 453 $ 79 $— $ 256 — 4 — — — 4 (137) — (15) 16 2 (134) (37) — — — — (37) — — 15 (16) — (1) (174) 4 — — 2 (168) 735 — (344) (3) (23) — — — — 365 — 93 2 $ 95 2 (57) (235) (11) — — (11) — — (312) 1 8 285 $ 293 4 (18) (18) — — 7 (2) 15 (16) (28) 2 16 73 $ 89 — — — — — — — (15) 16 1 — — — $— 741 (75) (597) (14) (23) 7 (13) — — 26 3 117 360 $ 477 F-62 . . . . . . . . . . . . . . . . . . . . . . . . . . . Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . Cash flows provided by (used in) financing activities: Proceeds from short and long term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repayment of capital lease obligations . . . beginning of year . . Premium paid on extinguishment of debt . . . . . . . Loans made to affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loan repayments from affiliates . . . Proceeds from sales/leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repayment of long term debt (including current portion) . . . . . . . . Proceeds from affiliate loans . . . . . Cash flows provided by (used in) investing activities: Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . Net cash flows provide by (used) in financing activities . . . . . . . . . . . . .

. . . . . . . . . . . . . . . $ (71) $ 95 $179 $ — $ 203 — — — 8 (111) 42 — — (61) (125) (11) 10 8 (8) 13 41 32 (40) (67) — — — — — — (1) (68) — — — — 119 (55) (41) — 23 (192) (11) 10 16 — — — 31 (146) — — (4) 1 — — 8 — 5 — (127) 129 $ 2 3 (36) (6) — (3) — 111 (42) 27 (7) 75 210 $ 285 7 (23) (14) — — (41) — (13) (84) (12) 15 58 $ 73 — — — — — 41 (119) 55 (23) — — — $ — 10 (59) (24) 1 (3) — — — (75) (19) (37) 397 $ 360 F-63 . . . Cash and cash equivalents. . . . . . Proceeds from affiliate loans . . . . . . .Condensed Consolidated Statement of Cash Flows Parent Company Year Ended December 31. . . . . . . Capital repayment to parent . . . Cash flows provided by (used in) investing activities: Purchases of property and equipment . . . . . . . . . . . . . . . . Repayment of loans to affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repayment of capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Payment of employee taxes on sharebased compensation . . . . Purchases of marketable securities . . . . . . . . . . 2008 Guarantor Non-Guarantor Subsidiaries Subsidiaries Eliminations Consolidated Cash flows provided by (used in) operating activities . Net cash flows used in investing activities . . . . . . . . . . . . Net cash flows provide by (used) in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Change in restricted cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Effect of exchange rate changes on cash and cash equivalents . . . . . Proceeds from sale of marketable securities . . . . . . . . . . . . . . . . . . . . . . . . end of year . . . . Loan repayments from affiliates . . Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Return of capital from subsidiary . . . . . . . . . Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . Proceeds from sale of property and equipment . . . . . . . . . . . . Loans made to affiliates . . . . . . . . . Proceeds from exercise of stock options . Cash flows provided by (used in) financing activities: Proceeds from short and long term debt . . . . . . Repayment of long term debt (including current portion) . . . . . . . . . . . beginning of year . . . . . . . . . . .

693 restricted stock units which vest over a two or three year period from the grant date subject to continued employment through the vesting date and subject to earlier pro-rata payout in the event of death or long-term disability. subject to continued employment through the vesting date and subject to earlier pro-rata payout in the event of death or long-term disability. and (ii) $5 in cash incentive which vests over a one or two year period from the grant date. shall be in cash rather than shares. Depending on how the Company ranks in total shareholder return as compared to the two peer groups. 2011. SUBSEQUENT EVENTS 2011 Long-Term Incentive Program In connection with the Company’s annual long-term incentive program for 2011. 2014. 2011. Each participant’s target performance share opportunity is based on total shareholder return over a three year period as compared to two peer groups. The awards granted aggregated: (i) 271.25. F-64 . the Board of Directors approved a grant of awards under a special rewards program intended to retain and motivate certain employees. 2011 Special Reward Program On January 21. each performance share grantee may earn 0% to 200% of the target number of performance shares. and the maximum payout of 200% will be made if such average ranking is at or above the 80th percentile. any payout exceeding 100% of the performance target award shall (other than in the context of a change in control) be paid at the sole discretion of the Board of Directors and.200 restricted stock units and 626. the Company awarded 626. No payout will be made if the average ranking of the Company’s total shareholder return relative to each of the two peer groups (weighted equally) is below the 30th percentile. However. on January 21. if paid.200 performance share opportunities to certain employees which vest on January 21.

. . .294 2008 Reserve for uncollectible accounts and sales credits . . . . . . . . . .294 2009 Reserve for uncollectible accounts and sales credits . . $ 50 Deferred tax valuation allowance . . . . .294 $ 58 2. . . . 2. . . . . . . . . . . . . $ 52 Deferred tax valuation allowance . . . . . .294 F-65 .SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (in millions) Column B Column C Column D Column E Additions Balance at Charged to Charged Balance at beginning costs and to other end of of period expenses accounts Deductions period Column A 2010 Reserve for uncollectible accounts and sales credits . . . . $ 58 Deferred tax valuation allowance . . . . . 2. . . . 2. .200 $ 50 2.663 $14 — $26 — $27 — $ 4 — $ 2 — $ 3 — $ (23) (94) $ (36) — $ (24) (369) $ 45 2. . . .

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. . . Our calculation of OIBDA may differ from similarly titled measures used by other companies. . . . . . . . . income taxes. and not as a substitute for. . . . . . OIBDA does not give effect to cash used for debt service requirements and thus does not reflect available funds for reinvestment. . . . . . . . Such excluded expenses primarily reflect the non-cash impacts of historical capital investments. . . . . . . . . . . . . . . . In addition. . . . . . other non-operating income or expense items and preferred stock dividends. . . . . . . . . . . . Management believes that OIBDA is useful to our investors as it is a relevant indicator of operating performance. Preferred stock dividends . . . . . . . . . OIBDA does not include certain significant items such as depreciation and amortization. . . . OIBDA should be considered in addition to. . . . . . . . . . . . . . . . . . . . . . . . . Year Ended December 31. . . . . . . . . . . . . . . . . . . as opposed to the cash impacts of capital expenditures made in recent periods. . . . . . . . . . . . . 2010 2009 OIBDA . . . . . . . . and of other items not associated with our everyday operations. . . . . . . . . such as interest income. . . . Management uses OIBDA as an important part of our internal reporting and planning processes and as a key measure to evaluate profitability and operating performance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . the following table provides a reconciliation of OIBDA. . . . . . . . . . . . . . . . . . . which is considered a non-GAAP (Generally Accepted Accounting Principles) financial measure. . . . Interest income . . . interest expense. . . . . . . Loss applicable to common shareholders . interest expense. . . . . . net . . . . . . . . . . . . . income taxes and preferred stock dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . There are material limitations to using non-GAAP financial measures. . $ 400 (337) 63 2 (191) (51) 5 (4) $(176) $ 342 (340) 2 7 (160) 11 (1) (4) $(145) . . . . . . . . . . . . Additionally. . . . OIBDA differs from operating income (loss) in that it excludes depreciation and amortization. . . . . . OIBDA is defined as operating income (loss) before depreciation and amortization. . other measures of financial performance reported in accordance with GAAP. . . . make comparisons between periods. . . Other income (expense). . . . . . . . . . . . Benefit (provision) for income taxes . distributions or other discretionary uses. and to make resource allocation decisions. . especially in a capital-intensive industry such as telecommunications. . . . . . . . interest income. .DEFINITIONS AND RECONCILIATIONS OF NON-GAAP FINANCIAL METRICS REFERENCED IN CEO LETTER Global Crossing Limited and Subsidiaries Unaudited Reconciliation of OIBDA to Income (Loss) Applicable to Common Shareholders ($ in millions) Pursuant to the SEC’s Regulation G. to income (loss) applicable to common shareholders. . . . . . . and may not be comparable to those other measures. . . . . . . . . . . . It excludes the effect of items associated with our capitalization and tax structures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest expense . . Operating income . . . . . . . . . . . . . OIBDA provides investors with an indication of the underlying performance of our everyday business operations. . Management believes that the investment community uses similar performance measures to compare performance of competitors in our industry. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation and amortization . . . . . . . . . . . . .

. . . . which is considered a non-GAAP (Generally Accepted Accounting Principles) financial measure. . . proceeds from financing activities. . . . . 2010 Free Cash Flow . Year Ended December 31. . Management believes that Free Cash Flow is useful to our investors as it provides an indication of the underlying cash position of our everyday business operations and the ability to pay debt. We define Free Cash Flow as net cash provided by (used in) operating activities less purchases of property and equipment as disclosed in the statement of cash flows.DEFINITIONS AND RECONCILIATIONS OF NON-GAAP FINANCIAL METRICS REFERENCED IN CEO LETTER Global Crossing Limited and Subsidiaries Unaudited Reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities ($ in millions) Pursuant to the SEC’s Regulation G. There are material limitations to using non-GAAP financial measures. . . . all financing activities. Our calculation of Free Cash Flow may differ from similarly titled measures used by other companies. . . . . . . . Free Cash Flow differs from the net change in cash and cash equivalents in the statement of cash flows in that it excludes the cash impact of: all investing activities (other than capital expenditures. Moreover. . . . we do not currently pay a significant amount of income taxes due to net operating losses. . . and not as a substitute for. . Free Cash Flow should be considered in addition to. . . Additionally. . . . . . Net cash provided by operating activities . which are a fundamental and recurring part of our business). . . . . . . . . . the following table provides a reconciliation of Free Cash Flow. net change in cash and cash equivalents in the statement of cash flows reported in accordance with GAAP. $ 16 167 $183 . repayments of capital lease obligations and other debt. Free Cash Flow also does not include certain significant cash items such as purchases and sales out of the ordinary course of business. . . Free Cash Flow is subject to variability quarter over quarter as a result of the timing of payments related to accounts receivable and accounts payable and capital expenditures. . and may not be comparable to those other measures. Free Cash Flow also is an important part of our internal reporting and a key measure used by management to evaluate liquidity from period to period. . . We believe that the investment community uses similar performance measures to compare performance of competitors in our industry. Management uses Free Cash Flow as a relevant indicator of our ability to generate cash to pay debt. . . Purchases of property and equipment . . . and we therefore generate higher Free Cash Flow than comparable businesses that do pay income taxes. . . and the effect of exchange rate changes on cash and cash equivalents balances. . . . . . . . . . . . . . . . . . . . . and exchange rate changes on cash and cash equivalents balances. to net cash provided by operating activities.

2005. in our common shares and in each of the NASDAQ Composite Index and the NASDAQ Telecommunications Index. with dividends reinvested.FINANCIAL PERFORMANCE COMPARISON GRAPH Comparison of Cumulative Total Returns The graph below compares the cumulative total shareholder return on Global Crossing Limited’s common shares from December 31. . Fiscal year ending December 31. 2010. with the cumulative total returns of the NASDAQ Composite Index and the NASDAQ Telecommunications Index over the same period. through December 31. 2005. The graph assumes $100 invested on December 31. 180 160 140 120 100 80 60 40 20 0 12/05 Relative Value 12/06 Global Crossing Ltd 12/07 NASDAQ Composite 12/08 12/09 NASDAQ Telecommunications 12/10 * $100 invested on 12/31/05 in stock or in index-including reinvestment of dividends.

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3. 6 Charles Macaluso Principal and Chief Executive Officer. Altaji Managing Director—Worldwide Carrier Services Neil Barua Managing Director—North America David R. 6 Richard R. “Pete” Aldridge.com Annual Meeting June 14. Christie Chief Information Officer/Chief Technology Officer Daniel J. Travelport Ltd 1. Singapore Technologies Telemedia Pte Ltd Jeremiah D. Vice Chairman of the Board. Continental Consulting Group.S.A. Board of Directors. Carey Chief Marketing Officer Anthony D. Board of Directors 2 Member. Deputy Chairman. Legere Chief Executive Officer. McShane Executive Vice President and General Counsel John R. Air Force. Jr. 2. Dorchester Capital Advisors 1. Space Division. 10:00 a.m. Government Security Committee 4 Member. Mulhearn. Alonso Managing Director—Latin America Omar A.I.com Executive Officers John J. Global Access Management Laurinda Y. Sutton Executive Vice President and General Manager.O. Nominating and Corporate Governance Committee Other Executive Committee Members Steven T. P. Legere Chief Executive Officer 2 Héctor R. Klug Chief Accounting Officer John A. Global Crossing Limited 1. Pang Senior Vice President—Human Resources John A.CORPORATE INFORMATION Board of Directors Lodewijk Christiaan van Wachem Chairman of the Board. Technology. Federal Sector Corporate Headquarters Wessex House 45 Reid Street Hamilton HM12. N. Sachs Principal. 2011. Executive Committee 3 Member. Former Under Secretary of Defense for Acquisition. Lambert Attorney John J. Singapore Technologies Telemedia Pte Ltd 1. 5 General Donald L. and Logistics 1.C. Caribou Technologies. 2. Global Crossing Limited Form 10-K and Other Investor Information A copy of the Company’s 10-K and any amendment thereto as filed with the Securities and Exchange Commission can be obtained upon written request to the Secretary. 4 Admiral Archie Clemins (retired) Former Admiral and 28th Commander. Clontz Senior Executive Vice President for North America and Europe. 5 E. Box 43070 Providence. Temasek Advisory Panel of Temasek Holdings (Private) Limited. U. Executive Vice President. Warwick New York Hotel 65 West 54th Street New York. 4 Lee Theng Kiat President and Chief Executive Officer. Global Crossing Limited 1. Pacific Fleet. Owner and President.globalcrossing. Operations Edward Higase Managing Director—EMEA Robert A. 6 1 Member. 3. Jr. Wessex House 45 Reid Street Hamilton HM12. Compensation Committee 6 Member. NY 10019 . S. 5. 4 Michael Rescoe Former Executive Vice-President and Chief Financial Officer. Erkeneff Former President and Chief Executive Officer. Kritzmacher Executive Vice President and Chief Financial Officer John B. 1. 4 Robert J. U. Cromer (retired) Former Commander. Private Consultant 1. 3. LLC 1. Enright Executive Vice President. Audit Committee 5 Member.computershare. STT Communications Ltd. 2. United Industrial Corporation 1. Inc. 02940-3070 Shareholder Inquiries: 1-800-962-4284 www. Bermuda or by e-mail request to investors@globalcrossing. 6 Peter Seah Lim Huat Member. R. 5. Bermuda 441-296-8600 Fax: 441-296-8606 www.com Transfer Agent Computershare Trust Company. 3.

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