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TABLE OF CONTENTS

As filed with the Securities and Exchange Commission on January 16, 2004

Registration No. 333-110241

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Amendment No. 2
to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation or organization)		   54-1708481
(I.R.S. Employer Identification No.)

1700 Old Meadow Road
McLean, Virginia 22102
(703) 902-2800
(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

K. Paul Singh
Chairman, President and Chief Executive Officer
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
1700 Old Meadow Road, Suite 300
McLean, Virginia 22102
(703) 902-2800
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:
 Brian J. Lynch, Esq.
Cooley Godward LLP
11951 Freedom Drive
Reston, VA 20190-5656
Telephone: (703) 456-8000

Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.

        If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. o

        If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. ý

        If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

        The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

SUBJECT TO COMPLETION, DATED January 16, 2004

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

PROSPECTUS

$200,000,000

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

Common Stock
Preferred Stock
Depositary Shares
Debt Securities
Warrants

        From time to time, we may sell common stock, preferred stock, debt securities and/or warrants. Any preferred stock that we sell may be sold either as shares of preferred stock or represented by depositary shares.

        We will provide the specific terms of these securities in one or more supplements to this prospectus. You should read this prospectus, the information incorporated by reference in this prospectus and any prospectus supplement carefully before you invest.

        Our common stock is traded on the Nasdaq National Market under the symbol "PRTL." The applicable prospectus supplement will contain information, where applicable, as to any other listing on the Nasdaq National Market or any securities market or other exchange of the securities, if any, covered by the prospectus supplement.

        INVESTING IN OUR SECURITIES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 6.

        THIS PROSPECTUS MAY NOT BE USED TO OFFER OR SELL ANY SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.

        The securities may be sold directly by us to investors, through agents designated from time to time or to or through underwriters or dealers. For additional information on the methods of sale, you should refer to the section entitled "Plan of Distribution" in this prospectus. If any underwriters are involved in the sale of any securities with respect to which this prospectus is being delivered, the names of such underwriters and any applicable commissions or discounts and over-allotment options will be set forth in a prospectus supplement. The price to the public of such securities and the net proceeds we expect to receive from such sale will also be set forth in a prospectus supplement.

        Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is January     , 2004


TABLE OF CONTENTS

        

ABOUT THIS PROSPECTUS   I
SUMMARY   1
RISK FACTORS   6
DIVIDEND POLICY   17
SELECTED FINANCIAL DATA   18
USE OF PROCEEDS   20
DESCRIPTION OF DEPOSITARY SHARES   20
DESCRIPTION OF DEBT SECURITIES   22
DESCRIPTION OF WARRANTS   24
LEGAL OWNERSHIP OF SECURITIES   27
PLAN OF DISTRIBUTION   31
WHERE YOU CAN FIND MORE INFORMATION   33
FORWARD-LOOKING INFORMATION   34
LEGAL MATTERS   36
EXPERTS   36

        You should rely only on the information contained or incorporated by reference into this prospectus or any applicable prospectus supplement. We have not authorized anyone to provide you with different information. We are not making an offer of the securities to be sold under this prospectus in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus or any applicable prospectus supplement is accurate as of any date other than the date on the front cover of this prospectus or the prospectus supplement, or that the information contained in any document incorporated by reference is accurate as of any date other than the date of the document incorporated by reference, regardless of the time of delivery of this prospectus or any sale of a security.


ABOUT THIS PROSPECTUS

        This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, using a "shelf" registration process. Under this shelf registration process, we may sell common stock, preferred stock, debt securities and warrants under this prospectus in one or more offerings up to a total dollar amount of $200,000,000. Any preferred stock that we sell may be sold either as shares of preferred stock or be represented by depositary shares. This prospectus provides you with a general description of the securities we may offer. Each time we sell any securities under this prospectus, we will provide a prospectus supplement that will contain more specific information about the terms of those securities. We may also add, update or change in a prospectus supplement any of the information contained in this prospectus or in documents we have incorporated by reference into this prospectus. This prospectus, together with the applicable prospectus supplements and the documents incorporated by reference into this prospectus, includes all material information relating to this offering. You should carefully read both this prospectus and the applicable prospectus supplement together with the additional information described under "Where You Can Find More Information" before buying securities in this offering.

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SUMMARY

        This summary highlights some of the information in this prospectus. Because this is only a summary, it does not contain all of the information that may be important to you. To understand this prospectus, the securities offered hereunder and our business, you should read the entire prospectus, particularly "Risk Factors" and the consolidated financial statements and related notes incorporated by reference into this prospectus.

        Primus Telecommunications Group, Incorporated is a global, facilities-based telecommunications services provider offering international and domestic voice, Internet and data services to business and residential retail customers and other carriers located primarily in the United States, Australia, Canada, the United Kingdom and western Europe. Our focus is to service the demand for high quality, competitively priced international communications services that is being driven by the globalization of the world's economies, the worldwide trend toward telecommunications deregulation and the growth of Internet and data traffic.

        We target customers with significant telecommunications needs, including small- and medium-sized enterprises, multinational corporations, residential customers, particularly ethnic customers, and other telecommunications carriers and resellers. We provide services over our global network, which consists of:

        We offer our customers a wide range of services, including:

        The services we offer can be characterized as three main products:

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        Summary net revenue, including percentage break-down, information with respect to our products, by operating segment and geographic region are as follows (in thousands):

Net Revenue by Product Segment

 
   Year Ended December 31
   Nine Months Ended September 30
  
 
   2000
   %
   2001
   %
   2002
   %
   2002
   %
   2003
   %
  
Voice   $ 1,077,728   90 % $ 930,635   86 % $ 854,840   83 % $ 629,122   83 % $ 803,572   85 %
Data/Internet   $ 99,696   8 % $ 112,836   10 % $ 111,416   11 % $ 85,041   11 % $ 93,711   10 %
VoIP   $ 21,998   2 % $ 39,004   4 % $ 57,800   6 % $ 42,281   6 % $ 51,665   5 %
   
 
 
 
 
 
 
 
 
 
 
Total Net Revenue   $ 1,199,422   100 % $ 1,082,475   100 % $ 1,024,056   100 % $ 756,444   100 % $ 948,948   100 %
   
 
 
 
 
 
 
 
 
 
 

Net Revenue by Geographic Segment

 
   Year Ended December 31
   Nine Months Ended September 30
  
Net Revenue
  
  2000
   %
   2001
   %
   2002
   %
   2002
   %
   2003
   %
  
North America                                                    
  United States   $ 343,027   28 % $ 271,588   25 % $ 212,399   20 % $ 153,427   20 % $ 214,121   23 %
  Canada   $ 179,372   15 % $ 172,647   16 % $ 163,428   16 % $ 122,241   16 % $ 152,715   16 %
  Other   $ 10,628   1 % $ 8,876   1 % $ 5,742   1 % $ 4,971   1 % $ 2,711   0 %
   
 
 
 
 
 
 
 
 
 
 
Total North America   $ 533,027   44 % $ 453,111   42 % $ 381,569   37 % $ 280,639   37 % $ 369,547   39 %
   
 
 
 
 
 
 
 
 
 
 
Europe                                                    
  United Kingdom   $ 159,683   13 % $ 141,297   13 % $ 139,480   14 % $ 105,656   14 % $ 107,117   11 %
  Germany   $ 98,053   8 % $ 99,189   9 % $ 63,767   6 % $ 50,790   7 % $ 40,814   4 %
  Netherlands   $ 32,882   3 % $ 42,824   4 % $ 79,467   8 % $ 49,716   7 % $ 116,074   12 %
  Other   $ 68,368   6 % $ 73,737   7 % $ 80,955   8 % $ 63,201   8 % $ 58,422   6 %
   
 
 
 
 
 
 
 
 
 
 
Total Europe   $ 358,986   30 % $ 357,047   33 % $ 363,669   36 % $ 269,363   36 % $ 322,427   33 %
   
 
 
 
 
 
 
 
 
 
 
Asia-Pacific                                                    
  Australia   $ 283,311   24 % $ 248,173   23 % $ 259,459   25 % $ 190,210   25 % $ 242,638   26 %
  Other   $ 24,098   2 % $ 24,144   2 % $ 19,359   2 % $ 16,232   2 % $ 14,336   2 %
   
 
 
 
 
 
 
 
 
 
 
Total Asia-Pacific   $ 307,409   26 % $ 272,317   25 % $ 278,818   27 % $ 206,442   27 % $ 256,974   28 %
   
 
 
 
 
 
 
 
 
 
 
Total Net Revenue   $ 1,199,422   100 % $ 1,082,475   100 % $ 1,024,056   100 % $ 756,444   100 % $ 948,948   100 %
   
 
 
 
 
 
 
 
 
 
 

        As of September 30, 2003, we had an accumulated deficit of $(702.8) million and a stockholder's deficit balance of $(118.3) million. We incurred net losses of $(63.6) million in 1998, $(112.7) million in 1999, $(174.7) million in 2000, $(306.2) million in 2001 and $(34.6) million in 2002.

        We are a Delaware corporation with our principal executive offices located at 1700 Old Meadow Road, McLean, Virginia 22102. Our telephone number is (703) 902-2800 and our web site address is www.primustel.com. We make available free of charge through the "Investors" section of our web site our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission ("SEC"). We include our web site address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our web site.

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 Recent Developments

        On January 16, 2004, our wholly owned subsidiary Primus Telecommunications Holding, Inc., or PTHI, sold $240 million aggregate principal amount of its 8% senior notes due 2014 pursuant to Rule144A and Regulation S under the Securities Act of 1933. We have agreed to fully and unconditionally guarantee these notes.

        On January 16, 2004, we transferred to PTHI by way of a capital contribution all of our net intercompany receivables and all of the capital stock of all of our direct subsidiaries other than PTHI, except for those subsidiaries, the transfer of whose capital stock will require the approval or consent of, or a filing with, state telecommunications regulatory authorities in the United States. We refer to those subsidiaries, the transfer of which would require such approval, consent or filing, as the contingently transferable subsidiaries. The contingently transferable subsidiaries consist primarily of our U.S. subsidiaries, and the subsidiaries that we transferred to PTHI on January 16, 2004 consist primarily of our non-U.S. subsidiaries. Under the indenture governing the new notes, we are obligated to use our best efforts to complete the transfer to PTHI of the capital stock of the contingently transferable subsidiaries in accordance with applicable law as soon as practicable.

        Until we have completed this transfer, our guarantee of the new notes will be secured by a pledge of the capital stock of the contingently transferable subsidiaries. The pledged capital stock will also equally and ratably secure our 123/4% senior notes due 2009 and possibly any amounts outstanding under our future credit facilities. We will continue to directly own PTHI and, upon the transfer of the capital stock of all of the contingently transferable subsidiaries to PTHI, PTHI will own all of our other subsidiaries. When we have completed the transfer, the pledge of the capital stock of the contingently transferable subsidiaries will automatically be released.

The Securities We May Offer

        We may offer shares of common stock and preferred stock, various series of debt securities, as referenced on the cover page of this prospectus, and warrants to purchase any of such securities with a total value of up to $200 million from time to time under this prospectus at prices and on terms to be determined by market conditions at the time of offering. Any preferred stock that we may offer may be offered either as shares of preferred stock or be represented by depositary shares. This prospectus provides you with a general description of the securities we may offer. Each time we offer a type or series of securities, we will provide a prospectus supplement that will describe the specific amounts, prices and other important terms of the securities, including, to the extent applicable:

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        The prospectus supplement also may add, update or change information contained in this prospectus or in documents we have incorporated by reference into this prospectus.

        This prospectus may not be used to offer or sell any securities unless accompanied by a prospectus supplement.

        We may sell the securities directly to or through agents, underwriters or dealers. We, and our agents or underwriters, reserve the right to accept or reject all or part of any proposed purchase of securities. If we do offer securities through agents or underwriters, we will include in the applicable prospectus supplement:

        Common Stock.    We may issue shares of our common stock from time to time. Holders of our common stock are entitled to one vote per share for the election of directors and on all other matters that require stockholder approval. Subject to any preferential rights of any outstanding preferred stock, in the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to share in the assets remaining after payment of liabilities and the liquidation preferences of any outstanding preferred stock. Our common stock does not carry any preemptive rights enabling a holder to subscribe for, or receive shares of, any class of our common stock or any other securities convertible into shares of any class of our common stock, or any redemption rights.

        Preferred Stock.    We may issue shares of our preferred stock from time to time, in one or more series. Under our certificate of incorporation, our board of directors has the authority, without further action by stockholders, to designate up to 2,455,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges, qualifications and restrictions granted to or imposed upon the preferred stock, including dividend rights, conversion rights, voting rights, rights and terms of redemption, liquidation preference and sinking fund terms, any or all of which may be greater than the rights of the common stock. To date, our board of directors has designated 1,044,950 of the 2,455,000 authorized shares of preferred stock, including 455,000 shares as Series A Junior Participating Preferred Stock, 30,000 shares as Series B Junior Participating Preferred Stock ("Series B Preferred") and 559,950 shares as Series C Convertible Preferred Stock ("Series C Preferred").

        We will fix the rights, preferences, privileges, qualifications and restrictions of the preferred stock of each series that we sell under this prospectus and applicable prospectus supplements in the certificate of designation relating to that series. We will incorporate by reference into the registration statement of which this prospectus is a part the form of any certificate of designation that describes the terms of the series of preferred stock we are offering before the issuance of the related series of preferred stock. We urge you to read the prospectus supplements related to the series of preferred stock being offered, as well as the complete certificate of designation that contains the terms of the applicable series of preferred stock.

        Depositary Shares.    We may elect to offer fractional shares of preferred stock rather than full shares of preferred stock and, in that event, will issue receipts for depositary shares. Each of these depositary shares will represent a fraction, which will be set forth in the applicable prospectus supplement, of a share of the applicable series of preferred stock.

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        Any depositary shares that we sell under this prospectus will be evidenced by depositary receipts issued under a deposit agreement between us and a depositary with whom we deposit the shares of the applicable series of preferred stock that underlie the depositary shares that are sold. A form of deposit agreement, including a form of depositary receipt, has been filed as an exhibit to the registration statement of which this prospectus is a part, and supplements to those forms containing other terms of any depositary shares that we sell under this prospectus will be incorporated by reference into the registration statement of which this prospectus is a part from reports we file with the SEC. We urge you to read the prospectus supplements related to any depositary shares being sold, as well as the complete deposit agreement and depositary receipt.

        Debt Securities.    We may issue debt securities from time to time, in one or more series, as either senior or subordinated debt or as senior or subordinated convertible debt. The senior debt securities will rank equally with unsubordinated debt outstanding and may be secured or unsecured. The subordinated debt securities will be subordinate and junior in right of payment, to the extent and in the manner described in the instrument governing the subordinated debt, to all or some portion of our indebtedness. Any convertible debt securities that we issue will be convertible into or exchangeable for our common stock or other securities. Conversion may be mandatory or at your option and would be at prescribed conversion rates.

        The debt securities will be issued under one or more documents called indentures, which are contracts between us and a trustee for the holders of the debt securities. In this prospectus, we have summarized certain general features of the debt securities. We urge you, however, to read the prospectus supplements related to the series of debt securities being offered, as well as the complete indentures that contain the terms of the debt securities. Indentures have been filed as exhibits to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt securities containing the terms of debt securities being offered will be incorporated by reference into the registration statement of which this prospectus is a part from reports we file in the future with the SEC.

        Warrants.    We may issue warrants for the purchase of our common stock, preferred stock, depositary shares and/or debt securities in one or more series, from time to time. We may issue warrants independently or together with common stock, preferred stock, depositary shares and/or debt securities, and the warrants may be attached to or separate from those securities.

        The warrants will be evidenced by warrant certificates issued under one or more warrant agreements, which are contracts between us and an agent for the holders of the warrants. In this prospectus, we have summarized certain general features of the warrants. We urge you, however, to read the prospectus supplements related to the series of warrants being offered, as well as the complete warrant agreements and warrant certificates that contain the terms of the warrants. Forms of warrant agreements and warrant certificates relating to warrants for the purchase of common stock, preferred stock, depositary shares and debt securities have been filed as exhibits to the registration statement of which this prospectus is a part, and complete warrant agreements and warrant certificates containing the terms of the warrants being offered will be incorporated by reference into the registration statement of which this prospectus is a part from reports we file in the future with the SEC.

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RISK FACTORS

        Any purchase of the securities offered under this prospectus involves a high degree of risk. You should consider carefully the following information about these risks, together with the information under the caption "Forward-Looking Information" and the other information contained in or incorporated by reference to this prospectus before you decide to buy the securities. If any of the following risks actually materializes, our business, financial condition, results of operations and future growth prospects would likely be materially adversely affected. In these circumstances, the market price of our securities would likely decline, and you may lose all or part of the money you paid to buy the securities.

Risks Related to Our Business

Our high level of debt may adversely affect our financial and operating flexibility.

        We currently have substantial indebtedness and may incur additional indebtedness in the future. As of September 30, 2003, our total consolidated indebtedness (including obligations under capital leases and equipment financings) was $599.0 million. The terms of our other indebtedness limit, but do not prohibit, the incurrence of additional indebtedness. In addition, the indenture governing the notes does not limit the incurrence of additional indebtedness.

        The level of our indebtedness:


We have experienced historical, and may experience future, operating losses and net losses which may hinder our ability to meet our debt service or working capital requirements.

        As of September 30, 2003, we had an accumulated deficit of $(702.8) million and a stockholder's deficit balance of $(118.3) million. We incurred net losses of $(63.6) million in 1998, $(112.7) million in 1999, $(174.7) million in 2000, $(306.2) million in 2001 and $(34.6) million in 2002. During the nine months ended September 30, 2003, we recognized net income of $35.4 million, a substantial portion of which can be attributed to foreign currency exchange rates that favorably impacted our results. Our recent net income should not necessarily be considered to be indicative of future net income and our results could be adversely effected by currency, competitive or technology developments described in greater detail in succeeding risk factors. As a result, we cannot assure you that our net income will grow or be sustained in future periods. If we cannot sustain net income or operating income, we may not be able to meet our debt service or working capital requirements. These developments could have a material adverse impact on the trading prices of our common stock and debt securities.

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Because a significant portion of our business is conducted outside the United States, fluctuations in foreign currency exchange rates could adversely affect our results of operations.

        A significant portion of our net revenue is derived from sales and operations outside the United States. The reporting currency for our consolidated financial statements is the United States dollar (USD). The local currency of each country is the functional currency for each of our respective entities operating in that country. In the future, we expect to continue to derive a significant portion of our net revenue and incur a significant portion of our operating costs outside the United States, and changes in exchange rates have had and may continue to have a significant, and potentially adverse, effect on our results of operations. Our primary risk of loss regarding foreign currency exchange rate risk is caused by fluctuations in the following exchange rates: USD/Australian dollar (AUD), USD/Canadian dollar (CAD), USD/British pound (GBP), and USD/Euro dollar (EUR). In the nine months ended September 30, 2003, the USD weakened compared to the AUD, CAD, GBP and EUR. As a result, our revenue of the subsidiaries whose local currency is the AUD, CAD and EUR increased 9%, 13% and 16% in local currency compared to the nine months ended September 30, 2002, but increased 28%, 25% and 40% in USD, respectively. Our revenue of the subsidiaries whose local currency is the GBP decreased 7% in local currency from the nine months ended September 30, 2002, but increased 1% in USD. Due to the large percentage of our operations conducted outside of the United States, strengthening of the USD relative to one or more of the foregoing currencies could have an adverse impact on our future results of operations. We historically have not engaged in hedging transactions and do not currently contemplate engaging in hedging transactions to mitigate foreign exchange risks.

        In addition, the operations of affiliates and subsidiaries in foreign countries have been funded with investments and other advances denominated in foreign currencies. Historically, such investments and advances have been long-term in nature, and we accounted for any adjustments resulting from currency translation as a charge or credit to "accumulated other comprehensive income (loss)" within the stockholders' deficit section of our consolidated balance sheets. In 2002, agreements with certain subsidiaries were put in place for repayment of a portion of the investments and advances made to the subsidiaries. As we anticipate repayment in the foreseeable future of these amounts, we recognize the unrealized gains and losses in foreign currency transaction gain (loss) on the consolidated statements of operations, and depending upon changes in future currency rates, such gains or losses could have a significant, and potentially adverse, effect on our results of operations.

Given our limited experience with, and the intense competition in, the Internet connectivity and data business, we may not be able to successfully operate or expand this part of our business.

        Since 1999, we have been targeting businesses and residential customers for Internet and data services through the Primus brand and other businesses. We have been expanding and intend to continue to expand our offering of Internet, data and VoIP services worldwide. We anticipate offering a broad range of Internet protocol-based data and voice communications over our global broadband ATM+IP network. Currently, we provide Internet access services to business and residential customers in the United States, Australia, Canada, Japan, India, Brazil, and Spain, and offer Internet transmission services in the Indian Ocean/Southeast Asia regions through our earth stations in India.

        Our experience with these services and these markets is limited. Furthermore, the market for dial-up and broadband Internet connectivity and related services is extremely competitive. Our primary competitors include incumbent operators, cable companies and other Internet service providers (ISPs) that have a significant national or international presence. Many of these operators have substantially greater resources, capital and operational experience than we do. We also expect we will experience increased competition from traditional telecommunications carriers and cable companies that expand into the market for Internet services. Therefore, our future operations involving these services may not generate operating or net income on a predictable basis and we may not be able to successfully expand this part of our business.

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If we do not operate our network efficiently and generate additional traffic, we may not be able to achieve our operational growth goals.

        Our long-term success depends on our ability to design, implement, operate, manage and maintain a reliable and cost-effective network. In addition, we rely on third parties to enable us to expand and manage our global network. If we fail to generate additional traffic on our network, if we experience technical or logistical impediments to our ability to migrate traffic onto our network, or if we experience difficulties with our third party providers, we may not achieve desired economies of scale or otherwise be successful in growing our business.

Our potential future growth may place a significant strain on our resources and, if not managed effectively, could result in operational inefficiencies and other difficulties.

        Our continued growth and expansion may place a significant strain on our management, operational and financial resources, and increase demand on our systems and controls. We have expanded our retail operations through our recent acquisition of the small- and medium-sized enterprise (SME) voice customer base of Cable & Wireless (C&W) in the United States and the expansion of our prepaid calling card product, particularly in Europe. To manage our growth effectively, we must continue to implement and improve our operational and financial systems and controls, purchase and utilize other transmission facilities, and expand, train and manage our employee base. If we inaccurately forecast the movement of traffic onto our network, we could have insufficient or excessive transmission facilities and disproportionate fixed expenses. As we proceed with our development, operational difficulties could arise from additional demand placed on our customer support, billing and management information systems, on our support, sales and marketing and administrative resources and on our network infrastructure. For instance, we may encounter delays or cost-overruns or suffer other adverse consequences in implementing new systems when required. In addition, our operating and financial control systems and infrastructure could be inadequate to ensure timely and accurate financial reporting.

The integration of our recent and future acquisitions ultimately may not provide the benefits originally anticipated by management and may distract the attention of our personnel from the operation of our business.

        We strive to increase the volume of voice and data traffic that we carry over our existing global network in order to reduce transmission costs and other operating costs as a percentage of net revenue, improve gross margins, improve service quality and enhance our ability to introduce new products and services. During 2002 and 2003, to further this growth strategy, we purchased the U.S.-based SME voice customers of C&W and made small purchases of businesses and assets to complement our Canadian-based operations. Future acquisitions may be pursued to further our strategic objectives, including those described above.

        Acquisitions of businesses and customer lists, a key element of our historical growth strategy, involve operational risks, including the possibility that an acquisition does not ultimately provide the benefits originally anticipated by management. Moreover, there can be no assurance that we will be successful in:

        There may be difficulty in integrating the service offerings, distribution channels and networks gained through acquisitions with our own. Successful integration of operations and technologies requires the dedication of management and other personnel, which may distract their attention from

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the day-to-day business, the development or acquisition of new technologies, and the pursuit of other business acquisition opportunities, and there can be no assurance that successful integration will occur in light of these factors.

We experience intense domestic and international competition which may adversely affect our results of operations and financial condition.

        The long distance telecommunications and data industry is intensely competitive with relatively limited barriers to entry in the more deregulated countries where we operate and with numerous entities competing for the same customers. Recent and pending deregulation in various countries may encourage new entrants to compete, including ISPs, cable television companies and utilities. For example, the United States and many other countries have committed to open their telecommunications markets to competition pursuant to an agreement under the World Trade Organization which began on January 1, 1998. Further, in the United States, as certain conditions have been met under the Telecommunications Act of 1996, the regional Bell operating companies (RBOCs) have been allowed to enter the long distance market, AT&T, MCI and other long distance carriers have been allowed to enter the local telephone services market, and any entity, including cable television companies and utilities, have been allowed to enter both the local service and long distance telecommunications markets. Moreover, the rapid enhancement of VoIP technology may result in increasing levels of traditional domestic and international voice long distance traffic being transmitted over the Internet, as opposed to traditional telecommunication networks such as ours. Currently, there are significant cost savings associated with carrying voice traffic employing VoIP technology, as compared to carrying calls over traditional networks. Thus, there exists the possibility that the price of traditional long distance voice services will decrease in order to be competitive with VoIP. Additionally, competition is expected to be intense to switch customers to VoIP product offerings, as is evidenced by numerous recent market announcements in the U.S. and internationally from industry leaders and competitive carriers concerning significant VoIP initiatives. Our ability to effectively retain our existing customer base and generate new customers, either through our network or our own VoIP offerings, may be adversely affected by accelerated competition arising as a result of VoIP initiatives. As competition intensifies as a result of deregulatory, market or technological developments, our results of operations and financial condition could be adversely affected.

We are substantially smaller than our major competitors, whose marketing and pricing decisions, and relative size advantage, could adversely affect our ability to attract and retain customers and could cause significant pricing pressures that could adversely affect our net revenues per minute, results of operations and financial condition.

        The long distance telecommunications and data industry is significantly influenced by the marketing and pricing decisions of the larger long distance industry and Internet access business participants. Our competitors in our core markets include, among others: AT&T, MCI, Sprint, the RBOCs and the major wireless carriers in the United States; Telstra, SingTel Optus and Telecom New Zealand in Australia; Telus, BCE, CallNet and Allstream (formerly AT&T Canada) in Canada; and British Telecommunications plc. (BT), Cable & Wireless UK, MCI, Colt Telecom, Energis and the major wireless carriers in the United Kingdom. Customers frequently change long distance providers and ISPs in response to the offering of lower rates or promotional incentives by competitors. Generally, customers can switch carriers at any time. Competition in all of our markets is likely to remain intense, or even increase in intensity and, as deregulatory influences are experienced in markets outside the United States, competition in non-United States markets is likely to become similar to the intense competition in the United States.

        Many of our competitors are significantly larger than we are and have:

9

As a result, our ability to attract and retain customers may be adversely affected by the actions of our larger competitors.

        Many of our competitors enjoy economies of scale that result in low cost structures for transmission and related costs that could cause significant pricing pressures within the industry. Several long distance carriers in the United States, including most recently, AT&T, MCI, Sprint, the RBOCs and the major wireless carriers, have introduced pricing and product bundling strategies that provide for fixed, low rates for calls within the United States. This strategy could have a material adverse effect on our net revenue per minute, results of operations and financial condition if increases in telecommunications usage and potential cost declines do not result in, or are insufficient to offset the effects of, such price decreases. Many companies emerging out of bankruptcy might benefit from a lower cost structure and might apply pricing pressure within the industry to gain market share. We compete on the basis of price, particularly with respect to our sales to other carriers, and also on the basis of customer service and our ability to provide a variety of telecommunications products and services. If such price pressures materialize, we may not be able to compete successfully in the future.

A deterioration in our relationships with facilities-based carriers could have a material adverse effect upon our cost structure, service quality, network diversity, results of operations and financial condition.

        We primarily connect our customers' telephone calls through transmission lines that we lease under a variety of arrangements with other facilities-based long distance carriers. Many of these carriers are, or may become, our competitors. Our ability to maintain and expand our business depends on our ability to maintain favorable relationships with the facilities-based carriers from which we lease transmission lines. If our relationship with one or more of these carriers were to deteriorate or terminate, it could have a material adverse effect upon our cost structure, service quality, network diversity, results of operations and financial condition. Moreover, we lease transmission lines from some vendors that currently are subject to tariff controls and other price constraints, which in the future may be changed.

Uncertainties and risks associated with international markets could adversely impact our international operations.

        We have significant international operations and, as of September 30, 2003, derive more than 75% of our revenues by providing services outside of the United States. In international markets, we are smaller than the principal or incumbent telecommunications carrier that operates in each of the foreign jurisdictions where we operate. In these markets, incumbent carriers are likely to:

10

        Moreover, the incumbent carrier may take many months to allow competitors, including us, to interconnect to its switches within its territory. There can be no assurance that we will be able to:


In addition, operating in international markets generally involves additional risks, including:

        These general risks present potentially significant risk to us in the aggregate because we derive such a large percentage of our revenues from outside of the United States.

        Our ability to operate and grow our international operations successfully could be adversely impacted by these risks and uncertainties.

Rapid changes in the telecommunications industry could adversely affect our competitiveness and our financial results.

        The telecommunications industry is changing rapidly due to:

        In addition, alternative services to traditional fixed wireline services, such as wireless and VoIP services, are a substantial competitive threat. If we do not adjust our contemplated plan of development to meet changing market conditions, we may not be able to compete effectively. The telecommunications industry is marked by the introduction of new product and service offerings and technological improvements. Achieving successful financial results will depend on our ability to:

        If we do not anticipate, assess or adapt to such technological changes at a competitive price, maintain competitive services or obtain new technologies on a timely basis or on satisfactory terms our financial results may be materially and adversely affected.

11


Terrorist attacks and other acts of violence or war may affect the market on which our securities trade, the markets in which we operate, our operations and our profitability.

        We are a U.S.-based corporation with significant international operations. Terrorist attacks, such as the attacks that occurred in New York and Washington, D.C. on September 11, 2001, and subsequent worldwide terrorist actions, including apparent action against companies operating abroad may negatively affect our operations and your investment in Primus. We cannot assure you that there will not be further terrorist attacks that impact our employees, network facilities or support systems, either in the United States or in any of the other countries in which we operate. Certain losses resulting from these types of events are uninsurable and others are not likely to be covered by our insurance.

        Terrorist attacks may directly impact our business operations through damage or harm to our employees, network facilities or support systems, increased security costs or the general curtailment of voice or data traffic. Any of these events could result in increased volatility in or damage to Primus and the United States and worldwide financial markets and economies. They also could result in a continuation of the current economic uncertainty in the United States or abroad, which could have a material adverse effect on our operating results and financial condition.

We are subject to potential adverse effects of regulation which may have a material adverse impact on our competitive position, growth and financial performance.

        Our operations are subject to constantly changing regulation. There can be no assurance that future regulatory changes will not have a material adverse effect on us, or that regulators or third parties will not raise material issues with regard to our compliance or noncompliance with applicable regulations, any of which could have a material adverse effect upon us.

        As a multinational telecommunications company, we are subject to varying degrees of regulation in each of the jurisdictions in which we provide our services. Local laws and regulations, and the interpretation of such laws and regulations, differ significantly among the jurisdictions in which we operate. Enforcement and interpretations of these laws and regulations can be unpredictable and are often subject to the informal views of government officials. Recent widespread regulatory changes in the United Kingdom and potential future regulatory, judicial, legislative and government policy changes in other jurisdictions where we operate could have a material adverse effect on us. Domestic or international regulators or third parties may raise material issues with regard to our compliance or noncompliance with applicable regulations, and therefore may have a material adverse impact on our competitive position, growth and financial performance.

        Regulatory considerations that affect or limit our business include:

        Any adverse developments implicating the foregoing could materially adversely affect our business, financial condition, results of operations and prospects.

12


Risks Related to an Investment in our Debt Securities

Our high level of debt may adversely affect our ability to satisfy our obligations under debt securities offered under this prospectus.

        We cannot assure you that we will be able to meet our debt service obligations. A default in our debt obligations, including a breach of any restrictive covenant imposed by the terms of our indebtedness, could result in the acceleration of a substantial portion of our indebtedness. In such a situation, it is unlikely we would be able to fulfill our obligations under debt securities offered under this prospectus or otherwise repay the accelerated indebtedness or make other required payments. Even in the absence of an acceleration of our indebtedness, a default under the terms of our indebtedness could have an adverse impact on our ability to satisfy our debt service obligations, including our obligations under the notes, and on the trading price of our securities.

We may not be able to pay interest and principal on the debt securities offered under this prospectus if we do not receive distributions from our subsidiaries.

        We have no independent operations and no significant assets other than the stock of, and intercompany loans payable by, our operating subsidiaries, and cash. Dividends, intercompany loans and other permitted payments from our direct and indirect subsidiaries, and our own credit arrangements, are our sources of funds to meet our cash needs, including the payment of expenses and principal and interest on debt securities under this prospectus. Our subsidiaries are legally distinct from us and have no obligations to pay amounts due with respect to the debt securities under this prospectus or to otherwise make funds available to us. Our subsidiaries will not guarantee the debt securities offered under this prospectus. Many of our subsidiaries are organized in jurisdictions outside the United States. Their ability to pay dividends, repay intercompany loans or make other distributions may be restricted by, among other things, the availability of funds, the terms of various credit arrangements entered into by them, as well as statutory and other legal restrictions. Additionally, payments from our subsidiaries may result in adverse tax consequences. If we do not receive dividends, distributions and other payments from our subsidiaries, we would be restricted in our ability to pay interest and principal on the debt securities offered under this prospectus and other indebtedness and in our ability to use cash flow from one subsidiary to cover shortfalls in working capital at another subsidiary.

Our holding company structure may limit your recourse to our subsidiaries' assets.

        Creditors of a holding company, such as the holders of debt securities offered under this prospectus, and the holding company itself generally will have subordinate claims against the assets of a particular subsidiary as compared to the creditors of that subsidiary. Accordingly, the debt securities offered under this prospectus will be structurally subordinated to all existing and future debt and other liabilities of our subsidiaries, including trade payables. As of September 30, 2003, our subsidiaries had outstanding debt and other liabilities (including trade payables, but excluding intercompany loans) of approximately $392.9 million. Our right to receive assets of any subsidiary upon the liquidation or reorganization of that subsidiary (and the consequent rights of the holders of the notes to participate in those assets) will be structurally subordinated to the claims of that subsidiary's creditors. Even if we are recognized as a creditor of that subsidiary as a result of an intercompany loan, such claims would be subordinate to any secured indebtedness of such subsidiary and any indebtedness of such subsidiary that is senior to such claims. We have no significant assets other than cash and the stock of, and intercompany loans payable by, our subsidiaries. If we or any of our subsidiaries were to enter into a bank credit facility or similar arrangement, we expect that the stock of the subsidiaries would be pledged to secure any such credit facility or arrangement, in which case, any claims you may have as a debtholder against the stock of the subsidiaries would be subordinate to claims of the lenders under such credit facility or arrangement.

13


Our ability to repurchase debt with cash upon a change of control may be limited.

        In certain circumstances involving a change of control of us, the holders of debt securities may require the repurchase of some or all of the holders' debt. If we are unable to pay some or all of the repurchase price in common stock, we will have to pay such repurchase price in cash. We cannot assure you that we will have sufficient financial resources at such time or would be able to arrange financing to pay the repurchase price of the debt in cash. Our ability to repurchase the debt in cash in such event may be limited by law, by the indenture or by the terms of other agreements. In addition, a change of control may trigger repayment obligations under the terms of our other indebtedness. In such a situation, we would be required to repay our other indebtedness in addition to being required to repurchase the debt securities at the option of the holders (to the extent we cannot satisfy our repurchase obligations in common stock). We may not have or be able to raise sufficient funds to satisfy all of our repayment or repurchase obligations.

If an active trading market for the debt securities does not develop, then the market price of the debt securities may decline or you may not be able to sell your debt securities.

        We cannot assure you that any liquid market will develop for the debt securities or that holders of the debt securities will be able to sell their debt securities, and we cannot provide assurances concerning the price at which the holders will be able to sell their debt securities. Accordingly, no market for the debt securities may develop, and any market that develops may not last. We do not intend to apply for listing of the debt securities on any securities exchange or other stock market. The liquidity of the trading market and the trading price of the debt securities may be adversely affected by declines in the trading price of our common stock and our other public debt securities, by changes in our financial performance or prospects and by changes in the financial performance of or prospects for companies in our industry generally.

Risks Relating to an Investment in our Equity Securities

Future sales of our common stock in the public market could create selling pressure on our common stock and lower our stock price.

        Significant future sales of our common stock in the public market, including in particular the shares offered under the Common Stock Resale Registration (defined below) and the Note Registration Statement (defined below), could lower our stock price and impair our ability to raise funds in new stock offerings.

        There are 22,616,990 shares of common stock that were issued upon conversion of our Series C Preferred and are being registered for resale on a separate registration statement (the "Common Stock Registration"). Of these shares, 13,540,008 are subject to a lock-up agreement generally restricting sales through July 30, 2004. Subject to this lock-up agreement, a majority of these shares first became eligible for resale through Rule 144 under the Securities Act on December 31, 2003, 5,000,000 shares first become eligible for resale through Rule 144 on November 25, 2004, and the remaining shares first become eligible for resale through Rule 144 on March 31, 2004, subject in each case to applicable volume limitations and other restrictions under Rule 144. In addition, the holders of the 33/4% convertible senior notes due 2010 (the "2010 Convertible Notes") have a registration statement covering the notes and common stock (the "Note Registration Statement") that may be acquired upon conversion of the 2010 Convertible Notes. Both the Common Stock Registration and the Note Registration Statement were effective under the Securities Act as of the date of this prospectus. Sales of a substantial amount of common stock in the public market, or the perception that these sales may occur, could create selling pressure on our common stock and adversely affect the market price of our common stock prevailing from time to time in the public market and could impair our ability to raise funds in additional stock offerings.

14

Future issuances of common stock could adversely impact our earnings per share and create selling pressure on our common stock, which could adversely affect our stock price.

        As of December 15, 2003, we had 88,443,258 outstanding shares of our common stock that were subject to dilution by:

        We may also issue a significant number of additional shares of common stock as consideration for future acquisitions or other investments or for other purposes. Under this prospectus, we may sell up to an aggregate of $200 million of debt and equity securities from time to time. Future issuances of common stock could adversely impact our earnings per share by diluting our outstanding common stock, which could adversely affect our stock price. Sales of a substantial amount of newly issued common stock in the public market, or the perception that these sales may occur, could adversely affect the market price of our common stock prevailing from time to time in the public market and could impair our ability to raise funds in additional stock offerings.

The market price of our common stock may decline and fluctuate significantly.

        In recent years, the market prices for securities of companies in the telecommunications industry have declined substantially and have been highly volatile. For example, from January 1, 1998 through December 31, 1999, the market price of our common stock and the Standard & Poor's Telecommunications (Long Distance) Index (the "Long Distance Index") increased by 137% and 110%, respectively. Subsequently, from January 1, 2000 through December 15, 2003, the market price of our common stock and the Long Distance Index declined by 75% and 89%, respectively. Various factors and events may cause the market price of our common stock to decline or fluctuate significantly. Such factors and events include the liquidity of the market for our common stock, variations in our quarterly operating results and our growth strategies, regulatory, technological or other changes (both domestic and international) affecting the telecommunications industry generally, our competitors' business developments, changes in the cost of telecommunications service or other operating costs and changes in general market conditions. On May 14, 2002, our common stock was delisted from the Nasdaq National Market for failure to meet the required minimum bid price necessary to maintain listing on the Nasdaq National Market, and on such date our common stock began trading on the Nasdaq SmallCap Market, which is generally a less liquid market than the Nasdaq National Market. On March 21, 2003, the listing of our common stock on the Nasdaq National Market was reinstated, after once again satisfying the minimum bid price requirements. There can be no assurance that our common stock will not decline or that future declines in the market price of our common stock will not result in our common stock being delisted from the Nasdaq National Market again or that if such delisting does occur, that there would be a liquid market for our common stock.

A small group of our stockholders could exercise influence over our affairs.

        As of December 15, 2003, funds affiliated with American International Group, Inc. (AIG) beneficially owned 18.7% of our outstanding common stock. As a result of such share ownership, these holders can exercise influence over our affairs through the provisions of an agreement between such holders and us, described in the section of the Common Stock Registration entitled "Description of

15


Capital Stock—Contractual Governance Provisions," which is incorporated by reference into this prospectus. This agreement requires the consent of a majority of our non-management directors before we may undertake certain actions, and provides for their right, subject to certain conditions, of the funds affiliated with AIG to nominate one member for election by stockholders to our board of directors and propose one Board observer, in each case, subject to the maintenance of certain minimum ownership levels.

        In addition, these holders' significant ownership levels could have an influence on:

        In addition, the applicable triggering provisions of our Rights Agreement contain exceptions with respect to the acquisition of beneficial ownership of our shares by such holders and the other former holder of Series C Convertible Preferred Stock (collectively, the "Former Series C Holders"). As a result, such holders could gain additional control over our affairs without triggering the provisions of our Rights Agreement.

Anti-takeover provisions could impede or discourage a third party acquisition.

        We are a Delaware corporation and the anti-takeover provisions of Delaware law impose various impediments to the ability of a third party to acquire control of our company, even if a change in control would be beneficial to our existing stockholders. In addition, our board of directors has the power, without stockholder approval, to designate the terms of one or more series of preferred stock and issue shares of preferred stock, which could be used defensively if a takeover is threatened. We also have adopted a Rights Agreement, commonly known as a "poison pill," that entitles our stockholders to acquire additional shares of our common stock, or a potential acquirer of our company, at a substantial discount from their market value in the event of an attempted takeover, unless such stockholders' rights are earlier redeemed or exchanged by us in the discretion of our board of directors. Our by-laws provide for a classified board of directors serving staggered three-year terms and restrictions on who may call a special meeting of stockholders, and our certificate of incorporation prohibits stockholder action by written consent. The indentures governing our outstanding notes and public debt require that we offer to repurchase such debt or notes upon a change of control. Lastly, all options issued under our stock option plans automatically vest upon a change of control. Our incorporation under Delaware law, our board of directors' ability to create and issue a new series of preferred stock, the acceleration of the vesting of options, the existence of our Rights Agreement, the requirement to repurchase senior notes and the notes, and certain provisions of our certificate of incorporation or by-laws could impede a merger, takeover or other business combination involving our company or discourage a potential acquirer from making a tender offer for our common stock, which, under certain circumstances, could reduce the market value of our common stock. See "Description of Capital Stock—Takeover Protections."

The securities we are offering may not develop an active public market, which could depress the resale price of the securities.

        The securities we are offering, other than our common stock, will be new issues of securities for which there is currently no trading market. We cannot predict whether an active trading market for the securities will develop or be sustained. If an active trading market were to develop, the securities could trade at prices that may be lower than the initial offering price of the securities.

        Keep the foregoing risk factors in mind when you read forward-looking statements contained elsewhere or incorporated by reference in this prospectus and the prospectus supplement. These

16


statements relate to our expectations about future events. Discussions containing forward-looking statements may be found, among other places, in "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" incorporated by reference from our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q, as well as any amendments thereto reflected in subsequent filings with the SEC. These forward-looking statements are based largely on our expectations and projections about future events and future trends affecting our business, and so are subject to risks and uncertainties, including the risks and uncertainties described below and under "Forward-Looking Information," that could cause actual results to differ materially from those anticipated in the forward-looking statements.


DIVIDEND POLICY

        We have not paid any cash dividends on our common stock to date. The payment of dividends, if any, in the future is within the discretion of our board of directors and will depend on our earnings, capital requirements and financial condition. Dividends are also restricted by certain of the indentures governing our outstanding notes and may be restricted by other credit arrangements entered into in the future. See "Risks Related to an Investment in our Debt Securities—We may not be able to pay interest and principal on the notes if we do not receive distributions from our subsidiaries." Our board of directors presently intends to retain all earnings, if any, for use in our business operations, and accordingly, our board of directors does not expect to declare or pay any dividends in the foreseeable future.

17


SELECTED FINANCIAL DATA

        The following selected financial data should be read in conjunction with our consolidated and consolidated condensed financial statements, the notes thereto, and with "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in documents incorporated by reference into this prospectus. The statement of operations data for the years ended December 31, 1998, 1999, 2000, 2001 and 2002 and the balance sheet data as of December 31, 1998, 1999, 2000, 2001 and 2002 have been derived from our consolidated financial statements, which have been audited by Deloitte & Touche LLP, independent auditors. The statement of operations data for the nine months ended September 30, 2002 and 2003, and the balance sheet data as of September 30, 2002 and 2003, have been derived from the unaudited consolidated condensed financial statements which, in management's opinion, include all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of the information set forth therein. You should not rely on interim results as being indicative of results we may expect for the full year.

 
   Year Ended December 31,
   Nine Months Ended
September 30,
  
 
   1998
   1999
   2000
   2001
   2002
   2002
   2003
  
 
   (in thousands, except per share amounts)

  
Statement of Operations Data:                                            
Net revenue   $ 421,628   $ 832,739   $ 1,199,422   $ 1,082,475   $ 1,024,056   $ 756,444   $ 948,948  
Cost of revenue     353,016     624,599     861,181     767,841     668,643     498,244     582,190  
   
 
 
 
 
 
 
 
Gross margin     68,612     208,140     338,241     314,634     355,413     258,200     366,758  
   
 
 
 
 
 
 
 

Operating expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Selling, general and administrative     79,532     199,581     330,411     303,026     254,152     187,084     254,146  
  Depreciation and amortization     24,185     54,957     120,695     157,596     82,239     60,067     62,713  
  Loss on sale of assets     —     —     —     —     —     —     804  
  Asset impairment write-down     —     —     —     526,309     22,337     570     537  
   
 
 
 
 
 
 
 
    Total operating expenses     103,717     254,538     451,106     986,931     358,728     247,721     318,200  
   
 
 
 
 
 
 
 

Income (loss) from operations
 
 
(35,105
)
 
(46,398
)
 
(112,865
)
 
(672,297
)
 
(3,315
)
 
10,479
 
 
48,558
 
Interest expense     (40,047 )   (79,629 )   (132,137 )   (100,700 )   (68,303 )   (52,085 )   (46,691 )
Gain on early extinguishment of debt     —     —     40,952     491,771     36,675     27,251     13,252  
Interest income and other income (expense)     11,504     13,395     30,743     (17,951 )   (771 )   880     385  
Foreign currency transaction gain (loss)     —     (104 )   (1,357 )   (1,999 )   8,486     (392 )   25,249  
   
 
 
 
 
 
 
 

Income (loss) before income taxes
 
 
(63,648
)
 
(112,736
)
 
(174,664
)
 
(301,176
)
 
(27,228
)
 
(13,867
)
 
40,753
 
Income tax benefit (expense)     —     —     —     (5,000 )   3,598     8,679     (3,681 )

Income (loss) before cumulative effect of change in accounting principle
 
 
(63,648
)
 
(112,736
)
 
(174,664
)
 
(306,176
)
 
(23,630
)
 
(5,188
)
 
37,072
 
Cumulative effect of change in accounting principle     —     —     —     —     (10,973 )   (10,973 )   —  
   
 
 
 
 
 
 
 

Net income (loss)
 
 
(63,648
)
 
(112,736
)
 
(174,664
)
 
(306,176
)
 
(34,603
)
 
(16,161
)
 
37,072
 
Accreted and deemed dividend on convertible preferred stock     —     —     —     —     —     —     (1,678 )
   
 
 
 
 
 
 
 

Income (loss) attributable to common stockholders
 
$
(63,648
)
$
(112,736
)
$
(174,664
)
$
(306,176
)
$
(34,603
)
$
(16,161
)
$
35,394
 
   
 
 
 
 
 
 
 

Basic income (loss) per common share
 
$
(2.61
)
$
(3.72
)
$
(4.40
)
$
(5.73
)
$
(0.54
)
$
(0.25
)
$
0.41
 
   
 
 
 
 
 
 
 

Diluted income (loss) per common share
 
$
(2.61
)
$
(3.72
)
$
(4.40
)
$
(5.73
)
$
(0.54
)
$
(0.25
)
$
0.40
 
   
 
 
 
 
 
 
 

Weighted average shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic     24,432     30,323     39,691     53,423     64,631     64,536     86,236  
  Diluted     24,432     30,323     39,691     53,423     64,631     64,536     90,026  

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   Year Ended December 31,
   Nine Months Ended
September 30,
  
 
   1998
   1999
   2000
   2001
   2002
   2002
   2003
  
 
   (in thousands, except ratios)

  
Geographic Data                                            

Net revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  North America   $ 188,008   $ 406,083   $ 533,027   $ 453,111   $ 381,569   $ 280,639   $ 369,547  
  Europe     60,863     195,477     358,986     357,047     363,669     269,363     322,427  
  Asia-Pacific     172,757     231,179     307,409     272,317     278,818     206,442     256,974  
   
 
 
 
 
 
 
 
Total   $ 421,628   $ 832,739   $ 1,199,422   $ 1,082,475   $ 1,024,056   $ 756,444   $ 948,948  
   
 
 
 
 
 
 
 

Other Data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross margin as a percentage of net revenue     16.3%     25.0%     28.2%     29.1%     34.7%     34.1%     38.6%  
Capital expenditures   $ 75,983   $ 110,582   $ 193,772   $ 87,771   $ 29,367   $ 21,929   $ 14,372  
Ratio of earnings to fixed charges(1)     <0     <0     <0     <0     <0     <0     1.82  

Free Cash Flow(2):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net cash provided by (used in) operating activities   $ (71,296 ) $ (55,570 ) $ (131,020 ) $ (110,351 ) $ 34,633   $ 26,288   $ 49,538  
Net cash used in investing activities     (54,221 )   (200,173 )   (240,014 )   (89,355 )   (31,607 )   (22,067 )   (15,337 )
   
 
 
 
 
 
 
 
Free cash flow   $ (125,517 ) $ (255,743 ) $ (371,034 ) $ (199,706 ) $ 3,026   $ 4,221   $ 34,201  
   
 
 
 
 
 
 
 

 
 
as of December 31,
 
as of September 30,
 
 
   1998
   1999
   2000
   2001
   2002
   2002
   2003
  
 
   (in thousands)

  
Balance Sheet Data:                                            
Cash and cash equivalents   $ 136,196   $ 471,542   $ 393,812   $ 83,953   $ 92,492   $ 72,050   $ 122,751  
Restricted cash and investments   $ 25,729   $ 25,932   $ 5,066   $ 4,961   $ 11,712   $ 6,932   $ 12,329  
Working capital(3)   $ 107,193   $ 384,998   $ 255,436   $ (62,590 ) $ (64,771 ) $ (85,179 ) $ (39,592 )
Total assets   $ 673,963   $ 1,450,746   $ 1,748,126   $ 816,214   $ 724,588   $ 736,905   $ 783,388  
Long-term obligations (including current portion)   $ 420,174   $ 929,944   $ 1,256,453   $ 667,587   $ 600,988   $ 613,677   $ 598,992  
Stockholder's equity (deficit)   $ 114,917   $ 190,859   $ 83,695   $ (178,484 ) $ (200,123 ) $ (182,905 ) $ (118,267 )
(1)
The ratio of earnings to fixed charges is computed by dividing pre-tax income from continuing operations (before adjustment for minority interests in consolidated subsidiaries and loss from equity investees) by fixed charges. Fixed charges consist of interest charges, whether expensed or capitalized, and that portion of rental expense we believe to be representative of interest. For the years ended December 31, 1998, 1999, 2000, 2001 and 2002 and the nine months ended September 30, 2002, earnings were insufficient to cover fixed charges by $63.6 million, $112.4 million, $174.6 million, $301.0 million, $23.6 million and $13.2 million, respectively.

(2)
Free cash flow, as defined by us, consists of net cash provided by (used in) operating activities less net cash used in investing activities. Free cash flow, as defined above, may not be similar to free cash flow measures presented by other companies, is not a measurement under generally accepted accounting principles in the United States, and should be considered in addition to, but not as a substitute for, the information contained in our statement of cash flows. We believe free cash flow provides a measure of our ability, after making our capital expenditures and other investments in our infrastructure, to meet scheduled debt payments. We use free cash flow to monitor the impact of our operations on our cash reserves and our ability to generate sufficient cash flow to fund our scheduled debt maturities and other financing activities, including discretionary refinancings and retirements of debt. Because free cash flow represents the amount of cash generated or used in operating activities and investing activities before deductions for scheduled debt maturities and other fixed obligations (such as capital leases, vendor financing and other long-term obligations), you should not use it as a measure of the amount of cash available for discretionary expenditures. Scheduled debt maturities paid during the years ended December 31, 1998, 1999, 2000, 2001 and 2002 were $2.4 million, $21.9 million, $16.3 million, $33.7 million and $25.9 million, respectively and during the nine months ended September 30, 2002 and September 30, 2003 were $23.9 million and $97.4 million, respectively. For information regarding our scheduled debt maturities and other fixed obligations, you should review the table disclosing our long-term obligations under "Management's Discussion and Analysis of Financial Conditions and Results of Operations—Liquidity—Short-and Long-Term Liquidity Considerations and Risks incorporated by reference into this prospectus from our quarterly and annual reports on Form 10-Q and 10-K, as filed with the SEC. See "Where You Can Find More Information."

(3)
Working capital consists of current assets less current liabilities, in each case calculated in accordance with United States generally accepted accounting principles.

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USE OF PROCEEDS

        Except as described in any prospectus supplement, we currently intend to use the net proceeds from the sale of our securities under this prospectus for the repurchase, repayment or redemption of outstanding debt and for working capital and other general corporate purposes.


DESCRIPTION OF DEPOSITARY SHARES

        We may offer fractional shares of preferred stock rather than full shares of preferred stock, and, in that event, will issue receipts for depositary shares. Each of these depositary shares will represent a fraction, which will be set forth in the applicable prospectus supplement, of a share of the applicable series of preferred stock.

        The shares of any series of preferred stock underlying any depositary shares that we may sell under this prospectus will be deposited under a deposit agreement between us and a depositary selected by us. Subject to the terms of the deposit agreement, each holder of a depositary share will be entitled, in proportion to the applicable fraction of a share of the preferred stock underlying the depositary share, to all of the rights, preferences and privileges, and be subject to the qualifications and restrictions, of the preferred stock underlying that depositary share.

        The depositary shares will be evidenced by depositary receipts issued under a deposit agreement. Depositary receipts will be distributed to the holders of the depositary shares that are sold in the applicable offering. A form of deposit agreement, including a form of depositary receipt, has been filed as an exhibit to the registration statement of which this prospectus is a part, and supplements to those forms containing other terms of any depositary shares that we sell under this prospectus will be incorporated by reference into the registration statement of which this prospectus is a part from reports we file in the future with the SEC. The following description of the material terms of the deposit agreement, the depositary shares and the depositary receipts is only a summary. We urge you to read the prospectus supplements relating to any depositary shares that are sold under this prospectus, as well as the complete deposit agreement and depositary receipt.

        Form.    Pending the preparation of definitive depositary receipts, the depositary may, upon our written order, issue temporary depositary receipts substantially identical to the definitive depositary receipts but not in definitive form. These temporary depositary receipts entitle their holders to all of the rights of definitive depositary receipts. Temporary depositary receipts will then be exchangeable for definitive depositary receipts at our expense.

        Dividends and Other Distributions.    The depositary will distribute all cash dividends or other cash distributions received with respect to the underlying preferred stock to the record holders of depositary shares in proportion to the number of depositary shares owned by those holders.

        If there is a distribution other than in cash, the depositary will distribute property received by it to the record holders of depositary shares in proportion to the number of depositary shares owned by those holders, unless the depositary determines that it is not feasible to do so. If this occurs, the depositary may, with our approval, sell the property and distribute the net proceeds from the sale to those holders in proportion to the number of depositary shares owned by them.

        Withdrawal of Underlying Preferred Stock.    Except as otherwise provided in a prospectus supplement, holders may surrender depositary receipts at the principal office of the depositary and, upon payment of any unpaid amount due to the depositary, be entitled to receive the number of whole shares of underlying preferred stock and all money and other property represented by the related depositary shares. We will not issue any partial shares of preferred stock. If the holder delivers depositary receipts evidencing a number of depositary shares that represent more than a whole number

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of shares of preferred stock, the depositary will issue a new depositary receipt evidencing the excess number of depositary shares to the holder.

        Redemption of Depositary Shares.    If the preferred stock underlying any depositary shares we may sell under this prospectus is subject to redemption, the depositary shares will be redeemed from the proceeds received by the depositary resulting from any such redemption, in whole or in part, of that underlying preferred stock. The redemption price per depositary share will be equal to the applicable fraction of the redemption price per share payable with respect to the underlying preferred stock. Whenever we redeem shares of underlying preferred stock that are held by the depositary, the depositary will redeem, as of the same redemption date, the number of depositary shares representing the shares of underlying preferred stock so redeemed. If fewer than all of the depositary shares are to be redeemed, the depositary shares to be redeemed will be selected by lot or proportionately, as may be determined by the depositary.

        Voting.    Upon receipt of notice of any meeting at which holders of the preferred stock underlying any depositary shares that we may sell under this prospectus are entitled to vote, the depositary will mail the information contained in the notice to the record holders of the depositary shares. Each record holder of the depositary shares on the record date, which will be the same date as the record date for the underlying preferred stock, will be entitled to instruct the depositary as to the exercise of the voting rights pertaining to the amount of the underlying preferred stock represented by the holder's depositary shares. The depositary will then try, as far as practicable, to vote the number of shares of preferred stock underlying those depositary shares in accordance with those instructions, and we will agree to take all reasonable actions which may be deemed necessary by the depositary to enable the depositary to do so. The depositary will not vote the underlying preferred stock to the extent it does not receive specific instructions with respect to the depositary shares representing such preferred stock.

        Conversion of Preferred Stock.    If the prospectus supplement relating to any depositary shares that we may sell under this prospectus states that the underlying preferred stock is convertible into our common stock or other securities, the following will apply. The depositary shares, as such, will not be convertible into any of our securities. Rather, any holder of the depositary shares may surrender the related depositary receipts to the depositary with written instructions to instruct us to cause conversion of the preferred stock represented by the depositary shares into or for whole shares of our common stock or other securities, as applicable. Upon receipt of those instructions and any amounts payable by the holder in connection with the conversion, we will cause the conversion using the same procedures as those provided for conversion of the underlying preferred stock. If only some of a holder's depositary shares are converted, a new depositary receipt or receipts will be issued to the holder for any depositary shares not converted.

        Amendment and Termination of the Deposit Agreement.    The form of depositary receipt evidencing the depositary shares and any provision of the deposit agreement may at any time be amended by agreement between us and the depositary. However, any amendment which materially and adversely alters the rights of the holders of depositary shares will not be effective until 90 days after notice of that amendment has been given to the holders. Each holder of depositary shares at the time any amendment becomes effective shall be deemed to consent and agree to that amendment and to be bound by the deposit agreement as so amended. The deposit agreement may be terminated by us or by the depositary only if all outstanding depositary shares have been redeemed or converted into any other securities into which the underlying preferred stock is convertible or there has been a final distribution, including to holders of depositary receipts, of the underlying preferred stock in connection with our liquidation, dissolution or winding up.

        Charges of Depositary.    We will pay all charges of the depositary, except for taxes and governmental charges and other charges as are expressly provided for in the deposit agreement to be

21


for the account of the holders of depositary shares or persons other than ourselves who may deposit any underlying preferred stock with the depositary.

        Reports.    The depositary will forward to holders of depositary receipts all notices and reports from us that we deliver to the depositary and that we are required to furnish to the holders of the underlying preferred stock.

        Limitation on Liability.    Neither we nor the depositary will be liable if either of us is prevented or delayed by law or any circumstance beyond our control in performing our respective obligations under the deposit agreement. Our obligations and those of the depositary will be limited to performance of our respective duties under the deposit agreement without, in our case, negligence or bad faith or, in the case of the depositary, negligence or willful misconduct. We and the depositary may rely upon advice of counsel or accountants, or upon information provided by persons presenting the underlying preferred stock for deposit, holders of depositary receipts or other persons believed by us in good faith to be competent and on documents believed to be genuine.

        Resignation and Removal of Depositary.    The depositary may resign at any time by delivering notice to us of its election to resign. We may remove the depositary at any time. Any resignation or removal will take effect upon the appointment of a successor depositary and its acceptance of the appointment. The successor depositary must be appointed within 60 days after delivery of the notice of resignation or removal and must be a bank or trust company having its principal office in the United States and having a combined capital and surplus of at least $50,000,000.


DESCRIPTION OF DEBT SECURITIES

        The following description, together with the additional information we include in any applicable prospectus supplements, summarizes the material terms and provisions of the debt securities that we may offer under this prospectus. While the terms we have summarized below will generally apply to any future debt securities we may offer under this prospectus, the particular terms of any debt securities that may be offered will be described in more detail in the applicable prospectus supplement. The terms of any debt securities offered under a prospectus supplement may differ from the terms described below.

        We will issue the senior notes under the senior indenture which will be entered into with the trustee named in the senior indenture. We will issue the subordinated notes under the subordinated indenture which will be entered into with the trustee named in the subordinated indenture. We have filed forms of these documents as exhibits to the registration statement of which this prospectus is a part. We use the term "indentures" to refer to both the senior indenture and the subordinated indenture.

        The indentures will be qualified under the Trust Indenture Act of 1939. We use the term "indenture trustee" to refer to either the senior trustee or the subordinated trustee, as applicable.

        The following summaries of material provisions of the senior notes, the subordinated notes and the indentures are subject to, and qualified in their entirety by reference to, all the provisions of the indenture applicable to a particular series of debt securities. We urge you to read the applicable prospectus supplements related to the debt securities that we sell under this prospectus, as well as the complete indentures that contain the terms of the debt securities. Except as we may otherwise indicate, the terms of the senior indenture and the subordinated indenture are identical.

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General

        We will describe in the applicable prospectus supplement the terms relating to a series of debt securities, including:

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DESCRIPTION OF WARRANTS

        The following description, together with the additional information we include in any applicable prospectus supplements, summarizes the material terms and provisions of the warrants that we may offer under this prospectus, which consist of warrants to purchase common stock, preferred stock, depositary shares and/or debt securities in one or more series. Warrants may be offered independently or together with common stock, preferred stock, depositary shares and/or debt securities offered by any prospectus supplement, and may be attached to or separate from those securities. While the terms we have summarized below will generally apply to any future warrants we may offer under this prospectus, we will describe the particular terms of any warrants that we may offer in more detail in the applicable prospectus supplement. The terms of any warrants we offer under a prospectus supplement may differ from the terms we describe below.

        We will issue the warrants under a warrant agreement which we will enter into with a warrant agent to be selected by us. We have filed forms of the warrant agreements and the related warrant certificates for each type of warrant we may offer under this prospectus as exhibits to the registration statement of which this prospectus is a part. We use the term "warrant agreement" to refer to any of these warrant agreements. We use the term "warrant agent" to refer to the warrant agent under any of these warrant agreements. The warrant agent will act solely as an agent of ours in connection with the warrants and will not act as an agent for the holders or beneficial owners of the warrants.

        The following summaries of material provisions of the warrants and the warrant agreements are subject to, and qualified in their entirety by reference to, all the provisions of the warrant agreement applicable to a particular series of warrants. We urge you to read the applicable prospectus supplements related to the warrants that we sell under this prospectus, as well as the complete warrant agreements that contain the terms of the warrants.

General

        We will describe in the applicable prospectus supplement the terms relating to a series of warrants. If warrants for the purchase of debt securities are offered, the prospectus supplement will describe the following terms, to the extent applicable:

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        Warrants for the purchase of debt securities will be in registered form only.

        If warrants for the purchase of common stock, preferred stock or depositary shares are offered, the prospectus supplement will describe the following terms, to the extent applicable:

        Warrants for the purchase of common stock, preferred stock or depositary shares will be in registered form only.

        A holder of warrant certificates may exchange them for new certificates of different denominations, present them for registration of transfer and exercise them at the corporate trust office

25


of the warrant agent or any other office indicated in the applicable prospectus supplement. Until any warrants to purchase debt securities are exercised, the holder of the warrants will not have any of the rights of holders of the debt securities that can be purchased upon exercise, including any rights to receive payments of principal, premium or interest on the underlying debt securities or to enforce covenants in the applicable indenture. Until any warrants to purchase common stock, preferred stock or depositary shares are exercised, holders of the warrants will not have any rights of holders of the underlying common stock, preferred stock or depositary shares, including any rights to receive dividends or to exercise any voting rights, except to the extent set forth under "—Warrant Adjustments" below.

Exercise of Warrants

        Each holder of a warrant is entitled to purchase the principal amount of debt securities or number of shares of common stock, preferred stock or depositary shares, as the case may be, at the exercise price described in the applicable prospectus supplement. After the close of business on the day when the right to exercise terminates (or a later date if we extend the time for exercise), unexercised warrants will become void.

        A holder of warrants may exercise them by following the general procedure outlined below:

        If you comply with the procedures described above, your warrants will be considered to have been exercised when the warrant agent receives payment of the exercise price, subject to the transfer books for the securities issuable upon exercise of the warrant not being closed on such date. After you have completed those procedures and subject to the foregoing, we will, as soon as practicable, issue and deliver to you the debt securities, common stock, preferred stock or depositary shares that you purchased upon exercise. If you exercise fewer than all of the warrants represented by a warrant certificate, a new warrant certificate will be issued to you for the unexercised amount of warrants. Holders of warrants will be required to pay any tax or governmental charge that may be imposed in connection with transferring the underlying securities in connection with the exercise of the warrants.

Amendments and Supplements to the Warrant Agreements

        We may amend or supplement a warrant agreement without the consent of the holders of the applicable warrants to cure ambiguities in the warrant agreement, to cure or correct a defective provision in the warrant agreement, or to provide for other matters under the warrant agreement that we and the warrant agent deem necessary or desirable, so long as, in each case, such amendments or supplements do not materially adversely affect the interests of the holders of the warrants.

Warrant Adjustments

        Unless the applicable prospectus supplement states otherwise, the exercise price of, and the number of securities covered by, a common stock warrant, preferred stock warrant or depositary share warrant will be adjusted proportionately if we subdivide or combine our common stock, preferred stock

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or depositary shares, as applicable. In addition, unless the prospectus supplement states otherwise, if we, without payment for:

then the holders of common stock warrants, preferred stock warrants and depositary share warrants, as applicable, will be entitled to receive upon exercise of the warrants, in addition to the securities otherwise receivable upon exercise of the warrants and without paying any additional consideration, the amount of stock and other securities and property such holders would have been entitled to receive had they held the common stock, preferred stock or depositary shares, as applicable, issuable under the warrants on the dates on which holders of those securities received or became entitled to receive such additional stock and other securities and property.

        Except as stated above, the exercise price and number of securities covered by a common stock warrant, preferred stock warrant and depositary share warrant, and the amounts of other securities or property to be received, if any, upon exercise of those warrants, will not be adjusted or provided for if we issue those securities or any securities convertible into or exchangeable for those securities, or securities carrying the right to purchase those securities or securities convertible into or exchangeable for those securities.

        Holders of common stock warrants, preferred stock warrants and depositary share warrants may have additional rights under the following circumstances:

        If one of the above transactions occurs and holders of our common stock, preferred stock or depositary shares are entitled to receive stock, securities or other property with respect to or in exchange for their securities, the holders of the common stock warrants, preferred stock warrants and depositary share warrants then outstanding, as applicable, will be entitled to receive upon exercise of their warrants the kind and amount of shares of stock and other securities or property that they would have received upon the applicable transaction if they had exercised their warrants immediately before the transaction.


LEGAL OWNERSHIP OF SECURITIES

        We can issue securities in registered form or in the form of one or more global securities. We describe global securities in greater detail below. We refer to those persons who have securities

27


registered in their own names on the books that we or any applicable trustee or depositary or warrant agent maintain for this purpose as the "holders" of those securities. These persons are the legal holders of the securities. We refer to those persons who, indirectly through others, own beneficial interests in securities that are not registered in their own names, as "indirect holders" of those securities. As we discuss below, indirect holders are not legal holders, and investors in securities issued in book-entry form or in street name will be indirect holders.

Book-Entry Holders

        We may issue securities in book-entry form only, as we will specify in the applicable prospectus supplement. This means securities may be represented by one or more global securities registered in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate in the depositary's book-entry system. These participating institutions, which are referred to as participants, in turn, hold beneficial interests in the securities on behalf of themselves or their customers.

        Only the person in whose name a security is registered is recognized as the holder of that security. Global securities will be registered in the name of the depositary. Consequently, for global securities, we will recognize only the depositary as the holder of the securities, and we will make all payments on the securities to the depositary. The depositary passes along the payments it receives to its participants, which in turn pass the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements they have made with one another or with their customers; they are not obligated to do so under the terms of the securities.

        As a result, investors in a global security will not own securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that participates in the depositary's book-entry system or holds an interest through a participant. As long as the securities are issued in global form, investors will be indirect holders, and not holders, of the securities.

Street Name Holders

        We may terminate a global security or issue securities that are not issued in global form. In these cases, investors may choose to hold their securities in their own names or in "street name." Securities held by an investor in street name would be registered in the name of a bank, broker or other financial institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account he or she maintains at that institution.

        For securities held in street name, we or any applicable trustee or depositary will recognize only the intermediary banks, brokers and other financial institutions in whose names the securities are registered as the holders of those securities, and we or any such trustee or depositary will make all payments on those securities to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in street name will be indirect holders, not holders, of those securities.

Legal Holders

        Our obligations, as well as the obligations of any applicable trustee or third party employed by us or a trustee, run only to the legal holders of the securities. We do not have obligations to investors who hold beneficial interests in global securities, in street name or by any other indirect means. This will be the case whether an investor chooses to be an indirect holder of a security or has no choice because we are issuing the securities only in global form.

28


        For example, once we make a payment or give a notice to the holder, we have no further responsibility for the payment or notice even if that holder is required, under agreements with its participants or customers or by law, to pass it along to the indirect holders but does not do so. Similarly, we may want to obtain the approval of the holders to amend an indenture, to relieve us of the consequences of a default or of our obligation to comply with a particular provision of an indenture, or for other purposes. In such an event, we would seek approval only from the holders, and not the indirect holders, of the securities. Whether and how the holders contact the indirect holders is up to the holders.

Special Considerations For Indirect Holders

        If you hold securities through a bank, broker or other financial institution, either in book-entry form because the securities are represented by one or more global securities or in street name, you should check with your own institution to find out:

Global Securities

        A global security is a security which represents one or any other number of individual securities held by a depositary. Generally, all securities represented by the same global securities will have the same terms.

        Each security issued in book-entry form will be represented by a global security that we issue to, deposit with and register in the name of a financial institution or its nominee that we select. The financial institution that we select for this purpose is called the depositary. Unless we specify otherwise in the applicable prospectus supplement, The Depository Trust Company, New York, New York, known as DTC, will be the depositary for all global securities issued under this prospectus.

        A global security may not be transferred to or registered in the name of anyone other than the depositary, its nominee or a successor depositary, unless special termination situations arise. We describe those situations below under "—Special Situations When a Global Security Will Be Terminated." As a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and holder of all securities represented by a global security, and investors will be permitted to own only beneficial interests in a global security. Beneficial interests must be held by means of an account with a broker, bank or other financial institution that in turn has an account with the depositary or with another institution that does. Thus, an investor whose security is represented by a global security will not be a holder of the security, but only an indirect holder of a beneficial interest in the global security.

        If the prospectus supplement for a particular security indicates that the security will be issued as a global security, then the security will be represented by a global security at all times unless and until the global security is terminated. If termination occurs, we may issue the securities through another

29


book-entry clearing system or decide that the securities may no longer be held through any book-entry clearing system.

Special Considerations For Global Securities

        As an indirect holder, an investor's rights relating to a global security will be governed by the account rules of the investor's financial institution and of the depositary, as well as general laws relating to securities transfers. We do not recognize an indirect holder as a holder of securities and instead deal only with the depositary that holds the global security.

        If securities are issued only as a global security, an investor should be aware of the following:

Special Situations When A Global Security Will Be Terminated

        In a few special situations described below, a global security will terminate and interests in it will be exchanged for physical certificates representing those interests. After that exchange, the choice of whether to hold securities directly or in street name will be up to the investor. Investors must consult their own banks or brokers to find out how to have their interests in securities transferred to their own name, so that they will be direct holders. We have described the rights of holders and street name investors above.

        A global security will terminate when the following special situations occur:

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        The prospectus supplement may also list additional situations for terminating a global security that would apply only to the particular series of securities covered by the prospectus supplement. When a global security terminates, the depositary, and not we or any applicable trustee, is responsible for deciding the names of the institutions that will be the initial direct holders.


PLAN OF DISTRIBUTION

        We may sell the securities through underwriters or dealers, through agents, or directly to one or more purchasers. The prospectus supplement will describe the terms of the offering of the securities, including:

        The only underwriters of the securities offered by a prospectus supplement will be the underwriters named in that prospectus supplement.

        If underwriters are used in the sale, they will acquire the securities for their own account and may resell them from time to time in one or more transactions at a fixed public offering price or at varying prices determined at the time of sale. The obligations of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement. We may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Subject to certain conditions, the underwriters will be obligated to purchase all the securities of the series offered by the prospectus supplement. Any public offering price and any discounts or concessions allowed or reallowed or paid to dealers may change from time to time. We may use underwriters with whom we have a material relationship. We will describe in the prospectus supplement, naming the underwriter, the nature of any such relationship.

        We may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement.

        Unless the prospectus supplement states otherwise, our agent will act on a best-efforts basis for the period of its appointment.

        We may authorize agents or underwriters to solicit offers by certain types of institutional investors to purchase securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. We will describe the conditions to these contracts and the commissions we must pay for solicitation of these contracts in the prospectus supplement.

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        We may provide agents and underwriters with indemnification against certain civil liabilities, including liabilities under the Securities Act, or contribution with respect to payments that the agents or underwriters may make with respect to such liabilities. Agents and underwriters may engage in transactions with, or perform services for, us in the ordinary course of business.

        All securities we offer, other than common stock, will be new issues of securities with no established trading market. Any underwriters may make a market in these securities, but will not be obligated to do so and may discontinue any market making at any time without notice. We cannot guarantee the liquidity of the trading markets for any securities.

        Any underwriter may engage in overallotment, stabilizing transactions, short covering transactions and penalty bids in accordance with Regulation M under the Exchange Act. Overallotment involves sales in excess of the offering size, which create a short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. Short covering transactions involve purchases of the securities in the open market after the distribution is completed to cover short positions. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally sold by the dealer are purchased in a covering transaction to cover short positions. Those activities may cause the price of the securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of the activities at any time.

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WHERE YOU CAN FIND MORE INFORMATION

        We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any reports, statements or other information filed by us at the SEC's public reference room at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. You can request copies of these documents by contacting the SEC and paying a fee for the copying costs. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. You also may inspect copies of these materials at the reading room of the library of the National Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006. Our SEC filings are also available to the public from commercial document retrieval services and at the SEC's web site at "http://www.sec.gov."

        We "incorporate by reference" into this prospectus certain information we file with the SEC, which means that we can disclose important information to you by referring you to another prospectus we filed with the SEC. The information incorporated by reference is an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings we will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, after the date of this prospectus but before the end of any offering made under this prospectus:

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        We will furnish without charge to you, upon written or oral request, a copy of any or all of the documents described above, except for exhibits, unless the exhibits are specifically incorporated by reference into the prospectus. You should direct your requests to: Primus Telecommunications Group, Incorporated, 1700 Old Meadow Road, McLean, VA 22102, Attention: Thomas R. Kloster, Senior Vice President.

        WE HAVE AUTHORIZED NO ONE TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS. YOU SHOULD RELY ONLY ON THE INFORMATION PROVIDED IN THIS PROSPECTUS OR INCORPORATED BY REFERENCE THEREIN. YOU MUST NOT RELY ON ANY UNAUTHORIZED INFORMATION.

        THIS PROSPECTUS DOES NOT OFFER TO SELL OR BUY ANY NOTES OR SHARES OF COMMON STOCK IN ANY JURISDICTION WHERE IT IS UNLAWFUL. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THIS DOCUMENT.


FORWARD-LOOKING INFORMATION

        Certain statements included or incorporated by reference into this prospectus and elsewhere concerning Primus constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on current expectations, and are not strictly historical statements. Forward-looking statements include, without limitation, statements set forth in this prospectus and elsewhere regarding, among other things:

        Factors and risks, including certain of those described in greater detail herein, that could cause actual results or circumstances to differ materially from those set forth or contemplated in forward-looking statements include, without limitation:

34

35

        As such, actual results or circumstances may vary materially from such forward-looking statements or expectations. Readers are also cautioned not to place undue reliance on these forward-looking statements which speak only as of the date these statements were made. We are not necessarily obligated to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

        You are advised, however, to consult the discussion of risks and uncertainties under "Risk Factors" in this prospectus and under "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Short- and Long-Term Liquidity Considerations and Risks" and "Business—Legal Proceedings" in the Form 8-K and in our Form 10-K and Forms 10-Q filed with the SEC. See "Where You Can Find More Information." These are the principal factors that we think could cause our actual results to differ materially from expected results, but other factors could also adversely affect our business and the value of your investment in our securities.


LEGAL MATTERS

        Cooley Godward LLP, Reston, Virginia, will pass upon legal matters for us regarding the validity of the securities offered hereby.


EXPERTS

        The consolidated financial statements and the related financial statement schedule of Primus Telecommunications Group, Incorporated and subsidiaries, incorporated in this prospectus by reference from Primus Telecommunications Group, Incorporated's Current Report on Form 8-K, as filed with the SEC on September 5, 2003, have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report dated February 27, 2003 (August 28, 2003 as to the effects of the adoption of Statement of Financial Accounting Standard (SFAS) No. 145 described in Note 2), which report expresses an unqualified opinion and includes an explanatory paragraph referring to the adoption of SFAS No. 142, "Goodwill and Other Intangible Assets" and SFAS No. 145, "Rescission of FASB Statements No. 4, 44, and 64, amendment of FASB Statement No. 13, and Technical Corrections," which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

        We have filed with the SEC a registration statement on Form S-3 under the Securities Act covering the securities described in this prospectus. This prospectus does not contain or incorporate by reference all of the information included in the registration statement, some of which is contained in exhibits included with or incorporated by reference into the registration statement. The registration statement, including the exhibits contained or incorporated by reference therein, can be read at the SEC web site or at the SEC office referred to above. Any statement made or incorporated by reference in this prospectus concerning the contents of any contract, agreement or other document is only a summary of the actual contract, agreement or other document. If we have filed or incorporated by reference any contract, agreement or other document as an exhibit to the registration statement, you should read the exhibit for a more complete understanding of the document or matter involved. Each statement regarding a contract, agreement or other document is qualified in its entirety by reference to the actual document.

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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution

        The following table sets forth the estimated costs and expenses, other than the underwriting discounts and commissions, payable by the registrant in connection with the offering of the securities being registered. All the amounts shown are estimates, except for the registration fee.

SEC registration fee   $ 6,180
Accounting fees and expenses     25,000
Legal fees and expenses     50,000
Printing and miscellaneous expenses     5,000
   
  Total   $ 96,180
   


Item 15. Indemnification of Officers and Directors

        Section 145 of the Delaware General Corporation Law (the "DGCL") permits each Delaware business corporation to indemnify its directors, officers, employees and agents against liability for each such person's acts taken in his or her capacity as a director, officer, employee or agent of the corporation if such actions were taken in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action, if he or she had no reasonable cause to believe his or her conduct was unlawful. Article X of our Amended and Restated By-Laws provides that we, to the full extent permitted by Section 145 of the DGCL, shall indemnify all of our past and present directors and may indemnify all of our past or present employees or other agents. To the extent that a director, officer, employee or agent of ours has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in such Article X, or in defense of any claim, issue or matter therein, he or she shall be indemnified by us against actually and reasonably incurred expenses in connection therewith. Such expenses may be paid by us in advance of the final disposition of the action upon receipt of an undertaking to repay the advance if it is ultimately determined that such person is not entitled to indemnification.

        As permitted by Section 102(b)(7) of the DGCL, Article 11 of our Amended and Restated Certificate of Incorporation provides that no director shall be liable to us for monetary damages for breach of fiduciary duty as a director, except for liability:


We have obtained a policy insuring us and our directors and officers against certain liabilities, including liabilities under the Securities Act.

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Item 16. Exhibits and Financial Statement Schedules

Exhibit
Number
   Description of Document
1.1   Form of Underwriting Agreement (1)

4.1
 
Specimen Preferred Stock Certificate and Form of Certificate of Designation of Preferred Stock(1)

4.2
 
Form of Deposit Agreement and Depositary Receipt (2)

4.3
 
Form of Senior Debt Indenture (3)

4.4
 
Form of Subordinated Debt Indenture (3)

4.5
 
Form of Senior Note (1)

4.6
 
Form of Subordinated Note (1)

4.7
 
Form of Common Stock Warrant Agreement and Warrant Certificate (2)

4.8
 
Form of Preferred Stock Warrant Agreement and Warrant Certificate (2)

4.9
 
Form of Depositary Share Warrant Agreement and Warrant Certificate (2)

4.10
 
Form of Debt Securities Warrant Agreement and Warrant Certificate (2)

5.1
 
Opinion of Cooley Godward LLP (2)

12.1
 
Statement of Computation of Ratio of Earnings to Fixed Charges (2)

23.1
 
Consent of Deloitte & Touche LLP, Independent Auditors (2)

23.2
 
Consent of Cooley Godward LLP (included in Exhibit 5.1) (2)

24.1
 
Power of Attorney (included on signature page) (3)

25.1
 
Statement of Eligibility of Trustee under the Senior Debt Indenture (2)

25.2
 
Statement of Eligibility of Trustee under the Subordinated Debt Indenture (3)
(1)
To be filed as an exhibit to a Current Report of the registrant on Form 8-K and incorporated herein by reference.

(2)
Filed herewith.

(3)
Previously filed.


Item 17. Undertakings.    The undersigned registrant hereby undertakes:

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        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC this form of indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against these liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by a director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of this issue.

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing Amendment No. 2 to this Registration Statement on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, Commonwealth of Virginia, on January 16, 2004.

    PRIMUS TELECOMMUNICATIONS GROUP,
INCORPORATED

 
 
By:
/s/  K. PAUL SINGH      
K. Paul Singh
Chairman, President and Chief Executive Officer

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signatures
   Title
   Date

/s/  K. PAUL SINGH      
K. Paul Singh
 
Chairman, President, Chief Executive Officer (Principal Executive Officer)
 
January 16, 2004

/s/  JOHN F. DEPODESTA      
John F. Depodesta
 
Executive Vice President, Secretary and Director
 
January 16, 2004

/s/  NEIL L. HAZARD      
Neil L. Hazard
 
Executive Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer)
 
January 16, 2004

/s/  TRACY BOOK LAWSON      
Tracy Book Lawson
 
Vice President — Corporate Controller (Principal Accounting Officer)
 
January 16, 2004

/S/ DAVID E. HERSHBERG*
David E. Hershberg
 
Director
 
January 16, 2004

/S/ NICK EARLE*
Nick Earle
 
Director
 
January 16, 2004

II-4


/S/ PRADMAN P. KAUL*
Pradman P. Kaul
 
Director
 
January 16, 2004

/S/ JOHN G. PUENTE*
John G. Puente
 
Director
 
January 16, 2004

/S/ DOUGLAS M. KARP*
Douglas M. Karp
 
Director
 
January 16, 2004

/S/ PAUL G. PIZZANI*
Paul G. Pizzani
 
Director
 
January 16, 2004

*By
 
/s/  K. PAUL SINGH      
K. Paul Singh
Attorney-in-fact
 
Director
 
January 16, 2004

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INDEX TO EXHIBITS

Exhibit
Number
   Description of Document
1.1   Form of Underwriting Agreement (1)

4.1
 
Specimen Preferred Stock Certificate and Form of Certificate of Designation of Preferred Stock (1)

4.2
 
Form of Deposit Agreement and Depositary Receipt (2)

4.3
 
Form of Senior Debt Indenture (3)

4.4
 
Form of Subordinated Debt Indenture (3)

4.5
 
Form of Senior Note (1)

4.6
 
Form of Subordinated Note (1)

4.7
 
Form of Common Stock Warrant Agreement and Warrant Certificate (2)

4.8
 
Form of Preferred Stock Warrant Agreement and Warrant Certificate (2)

4.9
 
Form of Depositary Share Warrant Agreement and Warrant Certificate (2)

4.10
 
Form of Debt Securities Warrant Agreement and Warrant Certificate (2)

5.1
 
Opinion of Cooley Godward LLP (2)

12.1
 
Statement of Computation of Ratio of Earnings to Fixed Charges (2)

23.1
 
Consent of Deloitte & Touche LLP, Independent Auditors (2)

23.2
 
Consent of Cooley Godward LLP (included in Exhibit 5.1) (2)

24.1
 
Power of Attorney (included on signature page) (3)

25.1
 
Statement of Eligibility of Trustee under the Senior Debt Indenture (2)

25.2
 
Statement of Eligibility of Trustee under the Subordinated Debt Indenture (3)
(1)
To be filed as an exhibit to a Current Report of the registrant on Form 8-K and incorporated herein by reference.

(2)
Filed herewith.

(3)
Previously filed.


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Exhibit 4.2

        PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

and

As Depositary

and

HOLDERS OF DEPOSITARY RECEIPTS

DEPOSIT AGREEMENT

Dated as of


TABLE OF CONTENTS

 
    
   Page
ARTICLE I   DEFINITIONS   1

ARTICLE II
 
FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND DELIVERY, TRANSFER, SURRENDER AND REDEMPTION AND REPURCHASE OF RECEIPTS
 
2
  Section 2.1.   Form and Transfer of Receipts   2
  Section 2.2.   Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof   3
  Section 2.3.   Redemption and Repurchase of Stock   4
  Section 2.4.   Register of Transfer of Receipts   5
  Section 2.5.   Combination and Split-ups of Receipts   5
  Section 2.6.   Surrender of Receipts and Withdrawal of Stock   5
  Section 2.7.   Limitations on Execution and Delivery, Transfer, Split-up, Combination and Surrender of Receipts and Withdrawal or Deposit of Stock   6
  Section 2.8.   Lost Receipts, etc   7
  Section 2.9.   Cancellation and Destruction of Surrendered Receipts   7
  Section 2.10.   Conversion   7

ARTICLE III
 
CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY
 
8
  Section 3.1.   Filing Proofs, Certificates and Other Information   8
  Section 3.2.   Payment of Taxes or Other Governmental Charges   8
  Section 3.3.   Withholding   9
  Section 3.4.   Representations and Warranties as to Stock   9

ARTICLE IV
 
THE STOCK, NOTICES
 
9
  Section 4.1.   Cash Distributions   9
  Section 4.2.   Distributions Other Than Cash   9
  Section 4.3.   Subscription Rights, Preferences or Privileges   9
  Section 4.4.   Notice of Dividends, Fixing of Record Date for Holders of Receipts   10
  Section 4.5.   Voting Rights   10
  Section 4.6.   Changes Affecting Stock and Reclassifications, Recapitalizations, etc   11
  Section 4.7.   Reports   11
  Section 4.8.   Lists of Receipt Holders   11

ARTICLE V
 
THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR AND THE COMPANY
 
11
  Section 5.1.   Maintenance of Offices, Agencies, Transfer Books by the Depositary; the Registrar   11
  Section 5.2.   Prevention or Delay in Performance by the Depositary, the Depositary's Agents, the Registrar or the Company   12
  Section 5.3.   Obligations of the Depositary, the Depositary's Agents, the Registrar and the Company   12
  Section 5.4.   Resignation and Removal of the Depositary, Appointment of Successor Depositary   13
  Section 5.5.   Corporate Notices and Reports   14
  Section 5.6.   Deposit of Stock by the Company   14
  Section 5.7.   Indemnification by the Company   14
  Section 5.8.   Fees, Charges and Expenses   14

ARTICLE VI
 
AMENDMENT AND TERMINATION
 
14
  Section 6.1.   Amendment   14
  Section 6.2.   Termination   15

ARTICLE VII
 
MISCELLANEOUS
 
15
  Section 7.1.   Counterparts   15
  Section 7.2.   Exclusive Benefits of Parties   15
  Section 7.3.   Invalidity of Provisions   15
  Section 7.4.   Notices   15
  Section 7.5.   Depositary's Agents   16
  Section 7.6.   Holders of Receipts Are Parties   16
  Section 7.7.   Governing Law   16
  Section 7.8.   Headings   16

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DEPOSIT AGREEMENT

        DEPOSIT AGREEMENT, dated as of                        among PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a Delaware corporation,                        , a                        existing under the laws of the State of                        , as Depositary, and all holders from time to time of Receipts issued hereunder.

W I T N E S S E T H:

        WHEREAS, the Company desires to provide as hereinafter set forth in this Deposit Agreement, for the deposit of shares of the Stock with the Depositary, as agent for the holders of the Receipts evidencing Depositary Shares representing an interest in the Stock so deposited, for the purposes set forth in this Deposit Agreement and for the issuance hereunder of such Receipts; and

        WHEREAS, the Receipts are to be substantially in the form annexed as Exhibit A to this Deposit Agreement, with appropriate insertions, modifications and omissions to reflect the terms of any Certificate of Designation and otherwise, as hereinafter provided in this Deposit Agreement.

        NOW, THEREFORE, in consideration of the premises contained herein, it is agreed by and among the parties hereto as follows:


ARTICLE I

DEFINITIONS

        The following definitions shall apply to the respective terms (in the singular and plural forms of such terms) used in this Deposit Agreement and the Receipts:

        "Certificate of Designation" shall mean the Certificate of Designation establishing and setting forth the rights, preferences, privileges, limitations and restrictions of the Stock, as filed with the Secretary of State of the State of Delaware.

        "Certificate of Incorporation" shall mean the Amended and Restated Certificate of Incorporation, as amended or as amended and restated from time to time, of the Company.

        "Company" shall mean Primus Telecommunications Group, Incorporated, a Delaware corporation, and its successors.

        "Corporate Office" shall mean the office of the Depositary in            , at which at any particular time its business in respect of matters governed by this Deposit Agreement shall be administered, which at the date of this Deposit Agreement is located at                  .

        "Deposit Agreement" shall mean this agreement, as the same may be amended, modified or supplemented from time to time to reflect the terms of any Certificate of Designation or otherwise in accordance with the provisions hereof.

        "Depositary" shall mean            , as Depositary hereunder, and any successor as Depositary hereunder.

        "Depositary Share" shall mean the rights evidenced by the Receipts executed and delivered hereunder, including the interests in Stock granted to holders of Receipts pursuant to the terms and conditions of the Deposit Agreement. Each Depositary Share shall represent an interest in    of one share of Stock deposited with the Depositary hereunder and the same proportionate interest in any and all other property received by the Depositary in respect of such share of Stock and held under this Deposit Agreement. Subject to the terms of this Deposit Agreement, each record holder of a Receipt evidencing a Depositary Share or Shares is entitled, proportionately, to all the rights, preferences and privileges, and subject to all the qualifications and restrictions, of the Stock represented by such Depositary Share or Shares, including any dividend, voting, conversion, redemption, liquidation and

1


sinking fund rights contained in the Certificate of Designation, and to the benefits of all obligations and duties of the Company in respect of the Stock under the Certificate of Designation and the Certificate of Incorporation.

        "Depositary's Agent" shall mean an agent appointed by the Depositary as provided, and for the purposes specified, in Section 7.5.

        "Receipt" shall mean a Depositary Receipt executed and delivered hereunder, in substantially the form of Exhibit A hereto, evidencing a Depositary Share or Shares, as the same may be amended from time to time to reflect the terms of any Certificate of Designation or otherwise in accordance with the provisions hereof.

        "Record holder" or "holder" as applied to a Receipt shall mean the person in whose name a Receipt is registered on the books maintained by or on behalf of the Depositary for such purpose.

        "Registrar" shall mean any company appointed to register ownership and transfers of Receipts as herein provided.

        "Securities Act" shall mean the Securities Act of 1933, as amended.

        "Stock" shall mean shares of the Company's            Preferred Stock, Series            , par value $0.01 per share.


ARTICLE II

FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND DELIVERY, TRANSFER, SURRENDER AND REDEMPTION AND REPURCHASE OF RECEIPTS

        Section 2.1.    Form and Transfer of Receipts.     Receipts shall be engraved or printed or lithographed unless they are evidenced by a global receipt held by a depositary for a clearing system and shall be substantially in the form set forth in Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions to reflect the terms of any Certificate of Designation or otherwise, as hereinafter provided. Receipts shall be executed by the Depositary by the manual signature of a duly authorized officer of the Depositary; provided, however, that such signature may be a facsimile if a Registrar (other than the Depositary) shall have countersigned the Receipts by manual signature of a duly authorized officer of the Registrar. Pending the preparation of definitive Receipts, the Depositary, upon the written order of the Company delivered in accordance with Section 2.2, shall execute and deliver temporary Receipts which shall be printed, lithographed, typewritten, or otherwise reproduced substantially of the tenor of the definitive Receipts in lieu of which they are issued and with appropriate insertions, modifications, omissions, substitutions and other variations as the persons executing such Receipts may determine are necessary for such temporary Receipts, as evidenced by their execution of such temporary Receipts. If temporary Receipts are issued, the Company and the Depositary will cause definitive Receipts to be prepared without unreasonable delay; provided that if such temporary Receipts are global Receipts held by a depositary for a clearing system, definitive Receipts need not be prepared until the Receipts cease to be so held. After the preparation of definitive Receipts, the temporary Receipts shall be exchangeable for definitive Receipts upon surrender of the temporary Receipts at the Corporate Office or such other office as the Depositary may designate, without charge to the holder. Upon surrender for cancellation of any one or more temporary Receipts, the Depositary shall execute and deliver in exchange therefor definitive Receipts representing the same number of Depositary Shares as represented by the surrendered temporary Receipt or Receipts. Such exchange shall be made at the Company's expense and without any charge therefor. Until so exchanged, the temporary Receipts shall in all respects be entitled to the same benefits under this Deposit Agreement, and with respect to the Stock, as definitive Receipts.

2

        No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose unless it shall have been executed as provided in the preceding paragraph. The Depositary shall record on its books each Receipt executed as provided above and delivered as hereinafter provided. Receipts bearing the facsimile signature of anyone who was at any time a duly authorized officer of the Depositary shall bind the Depositary, notwithstanding that such officer has ceased to hold such office prior to the delivery of such Receipts.

        Receipts may be issued in denominations of any number of whole Depositary Shares. All Receipts shall be dated the date of their execution.

        Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or regulation or with the rules and regulations of any securities exchange upon which the Stock or the Depositary Shares may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject by reason of the date of issuance of the Stock or otherwise.

        Title to any Receipt (and to the Depositary Shares evidenced by such Receipt) that is properly endorsed or accompanied by a properly executed instrument of transfer shall be transferable by delivery with the same effect as in the case of investment securities in general; provided, however, that the Depositary may, notwithstanding any notice to the contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to distributions of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes.

        Section 2.2.    Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof.     Subject to the terms and conditions of this Deposit Agreement, the Company or any holder of Stock may deposit such Stock under this Deposit Agreement by delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by the Depositary, by a properly executed instrument of transfer in form satisfactory to the Depositary, together with (i) all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement and (ii) a written order of the Company or such holder, as the case may be, directing the Depositary to execute and deliver to or upon the written order of the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares representing such deposited Stock.

        Upon receipt by the Depositary of a certificate or certificates for Stock to be deposited hereunder, together with the other documents specified above, the Depositary shall, as soon as transfer and registration can be accomplished, present such certificate or certificates to the registrar and transfer agent of the Stock for transfer and registration in the name of the Depositary or its nominee of the Stock being deposited. Deposited Stock shall be held by the Depositary in an account to be established by the Depositary at the Corporate Office.

        Upon receipt by the Depositary of a certificate or certificates for Stock to be deposited hereunder, together with the other documents specified above, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver, to or upon the order of the person or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section 2.2, a Receipt or Receipts for the number of whole Depositary Shares representing the Stock so deposited and registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at the Corporate Office, except that, at the request, risk and expense of any person requesting such delivery and for such person's account or, upon the order of such person, any other person's account, such delivery may be made at such other place as may be designated by such person. In each case, delivery will be made only upon

3


payment to the Depositary of all taxes and other governmental charges and any fees payable in connection with such deposit and the transfer of the deposited Stock.

        The Company shall deliver to the Depositary from time to time such quantities of Receipts as the Depositary may request to enable the Depositary to perform its obligations under this Deposit Agreement.

        Section 2.3.    Redemption and Repurchase of Stock.     Whenever the Company shall redeem shares of Stock in accordance with a Certificate of Designation, it shall (unless otherwise agreed in writing with the Depositary) give the Depositary in its capacity as Depositary not less than 3 business days' prior notice of the proposed date of the mailing of a notice of redemption of Stock and the simultaneous redemption of the Depositary Shares representing the Stock to be redeemed and of the number of such shares of Stock held by the Depositary to be redeemed. Unless the Certificate of Designation for a specific series of Stock provides for a different notice period with respect to that Stock in the event of its redemption, the Depositary shall, as directed by the Company in writing, mail, first class postage prepaid, notice of the redemption of Stock and the proposed simultaneous redemption of the Depositary Shares representing the Stock to be redeemed not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares, to the record holders of the Receipts evidencing the Depositary Shares to be so redeemed at the addresses of such holders as the same appear on the records of the Depositary or any Depositary's Agent or Registrar. Notwithstanding the foregoing, neither failure to mail or publish any such notice to one or more such holders nor any defect in any notice shall affect the sufficiency of the proceedings for redemption. The Company shall provide the Depositary with such notice, and each such notice shall state the method for determining the amount payable per Depositary Share, the redemption date, and the number of Depositary Shares to be redeemed, and such notice shall call upon each holder of Depositary Shares to surrender, on the redemption date and at the place or places designated by the Company, the Receipts evidencing Depositary Shares to be redeemed. On the date of any such redemption the Depositary shall surrender the certificate or certificates held by the Depositary evidencing the number of shares of Stock to be redeemed in the manner specified in the notice of redemption of Stock provided by the Company pursuant to the applicable Certificate of Designation. The Depositary shall, thereafter, redeem the number of Depositary Shares representing such redeemed Stock upon the surrender of Receipts evidencing such Depositary Shares in the manner provided in the notice sent to record holders of Receipts.

        Notice having been mailed by the Depositary as aforesaid, from and after the redemption date (unless the Company shall have failed to redeem the shares of Stock to be redeemed by it upon the surrender of the certificate or certificates therefor by the Depositary as described in the preceding paragraph), the Depositary Shares called for redemption shall be deemed no longer to be outstanding and all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the cash, securities or other property payable upon redemption upon surrender of such Receipts) shall, to the extent of such Depositary Shares, cease and terminate. The foregoing shall be subject further to the terms and conditions of the applicable Certificate of Designation.

        If fewer than all the Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will be selected by lot or proportionately, as may be determined by the Depositary. If fewer than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt upon its surrender to the Depositary, cash, securities or other property payable upon redemption in respect of the Depositary Shares called for redemption and a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption.

        The Depositary shall not be required to transfer or exchange for another Receipt any Receipt evidencing Depositary Shares called or being called for redemption, in whole or in part except as provided in the immediately preceding paragraph of this Section 2.3.

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        Whenever the Company shall be required to make an offer to repurchase Depositary Shares representing Stock in accordance with a Certificate of Designation, it shall (unless otherwise agreed in writing with the Depositary) give the Depositary in its capacity as Depositary not less than 3 business days' prior notice of the required date of the mailing of a notice of the repurchase offer. The Depositary shall, as directed by the Company in writing, mail, first class postage prepaid, notice of the relevant terms of the repurchase offer, as provided by the Company, to the record holders of the Receipts at the addresses of such holders as the same appear on the records of the Depositary or any Depositary's Agent or Registrar, including: (i) that such notice is being given pursuant to a repurchase offer, (ii) the number of Depositary Shares and Stock for which the offer is being made, (iii) the method for determining the amount payable per Depositary Share, (iv) the last date, which, unless the Certificate of Designation for a specific series of Stock provides for a different period with respect to that Stock in the event that the Company is required to make an offer to repurchase it, shall not be less than 30 nor more than 60 days after the date of such notice, by which a holder must elect to accept the repurchase offer, (v) the procedures that such holder must follow to exercise its rights, and (vi) the procedures for withdrawing an election.

        The Depositary shall, thereafter, receive from each holder electing to have Depositary Shares repurchased pursuant to the repurchase offer in accordance with the instructions in the notice, the holder's Receipts, with an appropriate form duly completed prior to the repurchase date. Holders will be entitled to withdraw an election by a written notice of withdrawal delivered to the Depositary prior to the close of business on the repurchase date. The notice of withdrawal shall state the number of Depositary Shares and the Receipt numbers to which the notice of withdrawal relates and the number of Depositary Shares and Receipt numbers, if any, which remain subject to election. In case the aggregate number of Depositary Shares offered for repurchase by the holders exceeds the amount of Depositary Shares which the Company has offered to repurchase pursuant to the repurchase offer, the Depositary Shares to be repurchased shall be selected by the Depositary by lot or proportionately, as may be determined by the Depositary. The Depositary shall, at the direction of the Company, cause payment to be mailed or delivered to each tendering holder as promptly as reasonably practicable after the repurchase date, in the amount of the repurchase price for the Depositary Shares tendered, and any unpurchased Depositary Shares to be returned to the holder thereof. The foregoing is subject further to the terms and conditions of the applicable Certificate of Designation.

        Section 2.4.    Register of Transfer of Receipts.     Subject to the terms and conditions of this Deposit Agreement, the Depositary shall register on its books from time to time transfers of Receipts upon any surrender thereof at the Corporate Office, or such other office as the Depositary may designate for such purpose, by the record holder in person or by a duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer, together with evidence of the payment of any transfer taxes as may be required by law. Upon such surrender, the Depositary shall execute a new Receipt or Receipts and deliver the same to or upon the order of the person entitled thereto evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered.

        Section 2.5.    Combination and Split-ups of Receipts.     Upon surrender of a Receipt or Receipts at the Corporate Office, or such other office as the Depositary may designate for the purpose of effecting a split-up or combination of Receipts, subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized denominations requested evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered; provided, however, that the Depositary shall not issue any Receipt evidencing a fractional Depositary Share.

        Section 2.6.    Surrender of Receipts and Withdrawal of Stock.     Any holder of a Receipt, including the Company, shall have the right, upon payment of any amount due to the Depositary with respect to the Receipt, to withdraw any or all of the Stock (but only in whole shares of Stock) represented by the

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Depositary Shares and all money and other property, if any, represented by such Depositary Shares by surrendering the Receipt or Receipts evidencing such Depositary Shares at the Corporate Office, or at such other office as the Depositary may designate for such withdrawals (and cancellation of the surrendered Receipts as provided in Section 2.9). After such surrender, without unreasonable delay, the Depositary shall deliver to the holder the whole number of shares of Stock and all such money and other property, if any, represented by the Depositary Shares evidenced by the Receipt or Receipts so surrendered for withdrawal. If the Receipt or Receipts delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares in excess of the number of whole Depositary Shares representing the whole number of shares of Stock to be withdrawn, the Depositary shall at the same time, in addition to such whole number of shares of Stock and such money and other property, if any, to be withdrawn, deliver to the holder, or (subject to Section 2.4) upon its order, a new Receipt or Receipts evidencing such excess number of whole Depositary Shares.

        Delivery of the Stock and such money and other property being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate, which, if required by the Depositary, shall be properly endorsed or accompanied by proper instruments of transfer.

        The Depositary shall deliver the Stock and the money and other property, if any, represented by the Depositary Shares evidenced by Receipts surrendered for withdrawal, without unreasonable delay, at the office at which such Receipts were surrendered, except that, at the request, risk and expense of the Company such delivery may be made, without unreasonable delay, at such other place as may be designated by the Company.

        For purposes of determining the number of Depositary Shares outstanding on any dividend payment date, the Receipts representing Depositary Shares acquired by the Company on or prior to such dividend payment date and not theretofore delivered to the Depositary for withdrawal and cancellation shall be deemed to be outstanding.

        Section 2.7.    Limitations on Execution and Delivery, Transfer, Split-up, Combination and Surrender of Receipts and Withdrawal or Deposit of Stock.     As a condition precedent to the execution and delivery, registration of transfer, split-up, combination, or surrender of any Receipt, the delivery of any distribution thereon or withdrawal or deposit of Stock, or the exercise of any conversion right referred to in Section 2.10, the Depositary, any of the Depositary's Agents, the Registrar or the Company may require any or all of the following: (i) payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any tax or other governmental charge or fee with respect thereto (including any such tax or charge or fee with respect to the Stock being deposited or the Stock being withdrawn or with respect to property of the Company being issued upon redemption or conversion); (ii) production of proof satisfactory to it as to the identity and genuineness of any signature; and (iii) compliance with such reasonable regulations, if any, as the Depositary or the Company may establish not inconsistent with the provisions of this Deposit Agreement.

        The deposit of Stock may be refused, or the registration of transfer, split-up, combination or surrender of outstanding Receipts and the withdrawal of deposited Stock or the exercise of any conversion right referred to in Section 2.10 may be suspended (i) during any period when the register of stockholders of the Company is closed, (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of this Deposit Agreement, or (iii) with the approval of the Company, for any other reason. Without limitation of the foregoing, the Depositary shall not knowingly accept for deposit under this Deposit Agreement any shares of Stock that are required to be registered under the

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Securities Act unless a registration statement under the Securities Act is in effect as to such shares of Stock.

        Section 2.8.    Lost Receipts, etc.     In case any Receipt shall be mutilated or destroyed or lost or stolen, the Depositary shall execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt or in lieu of and in substitution for such destroyed, lost or stolen Receipt unless the Depositary has notice that such Receipt has been acquired by a bona fide purchaser; provided, however, that the holder thereof provides the Depositary with (i) evidence satisfactory to the Depositary of such destruction, loss or theft of such Receipt, of the authenticity thereof and of his ownership thereof, (ii) reasonable indemnification satisfactory to the Depositary or the payment of any charges incurred by the Depositary in obtaining insurance in lieu of such indemnification and (iii) payment of any expense (including fees, charges and expenses of the Depositary) in connection with such execution and delivery.

        Section 2.9.    Cancellation and Destruction of Surrendered Receipts.     All Receipts surrendered to the Depositary or any Depositary's Agent shall be cancelled by the Depositary. Except as prohibited by applicable law or regulation, the Depositary is authorized to destroy such Receipts so canceled.

        Section 2.10.    Conversion.     In the event that the Stock, in accordance with its Certificate of Designation, is convertible into the Company's common stock or other securities, subject to the terms and conditions of this Deposit Agreement, a holder of a Receipt or Receipts may surrender such Receipt or Receipts at the Corporate Office or at such other office or to a Depositary's Agent that the Depositary may designate for such purpose, together with a notice of conversion duly completed and executed, thereby directing the Depositary or such Depositary's Agent to instruct the Company to cause the conversion of the number of shares of Stock specified in such notice of conversion into shares of the Company's common stock or other securities at the rate specified in the applicable Certificate of Designation, and an assignment of such Receipt or Receipts to the Company or in blank, duly completed and executed, along with any other documents or instruments and any amounts required by the applicable Certificate of Designation.

        Upon receipt by the Depositary or a Depositary's Agent of a Receipt or Receipts, together with a notice of conversion, duly completed and executed, directing the Depositary or such Depositary's Agent to instruct the Company to cause the conversion of a specified number of shares of Stock at the rate specified in the applicable Certificate of Designation, and an assignment of such Receipt or Receipts to the Company or in blank, duly completed and executed, along with any other documents or instruments or amounts referred to in the preceding paragraph, the Depositary or such Depositary's Agent shall instruct the Company, subject to any adjustment provided for in the applicable Certificate of Designation, (i) to cause the conversion at the rate specified in the applicable Certificate of Designation of the number of shares of Stock represented by the Depositary Shares evidenced by the Receipt or Receipts so surrendered for conversion as specified in the written notice to the Depositary or such Depositary's Agent and (ii) to cause the delivery to the holder of such Receipt or Receipts of (a) a certificate or certificates evidencing the number of whole shares of the Company's common stock or other securities into which such Stock has been converted, and (b) the amount of cash or other property, if any, to which such holder is entitled in lieu of fractional shares of, or fractional interests in, the Company's common stock or other securities otherwise deliverable by the Company upon such conversion, calculated in accordance with the applicable Certificate of Designation. The Company shall as promptly as practicable after receipt thereof cause the delivery of the certificate or certificates and cash or other property, if any, referred to in clauses (a) and (b) above, and such conversion shall be deemed to have been effected immediately prior to the close of business on the date of such receipt and shall occur at the rate specified in the Certificate of Designation in effect at such time and on such date. Upon such conversion, the Depositary or such Depositary's Agent (i) shall deliver to the holder a Receipt evidencing the number of Depositary Shares evidenced by the surrendered Receipt or Receipts in excess of the number of Depositary Shares evidenced by such Receipt or Receipts that have been so

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converted, (ii) shall cancel the Receipts surrendered for conversion and (iii) shall deliver to the Company for cancellation the number of shares of Stock evidenced by the Receipts so surrendered and so converted. Upon the delivery of the shares of Stock to be cancelled due to such conversion by the Depositary or such Depositary's Agent to the Company, the Company shall deliver to the Depositary or such Depositary's Agent, as applicable, a certificate or certificates evidencing the number of shares of Stock, if any, that equals the excess of the number of shares evidenced by the surrendered certificate over the number of shares evidenced by that certificate that have been so converted. Depositary Shares converted in connection with conversion of the Stock represented thereby shall only be converted in whole, and not in part.

        Upon the conversion of any Stock for which a notice of conversion has been provided to the Depositary or a Depositary's Agent by the holder of the Receipt or Receipts representing such Stock, the Depositary Shares evidenced by such Receipt or Receipts shall be deemed no longer outstanding, all rights of the holder of the Receipt or Receipts evidencing such Depositary Shares (except the right to receive (i) the Company's common stock or other securities to which such holder is entitled upon conversion in accordance with the applicable Certificate of Designation, (ii) any cash or other property payable in accordance with the applicable Certificate of Designation with respect to any fractional shares or other fractional interests in the Company's common stock or other securities otherwise deliverable by the Company upon conversion, (iii) any Receipts evidencing Depositary Shares representing Stock which was not so converted and (iv) any other securities, property or cash to which such holder is entitled under this Deposit Agreement) shall cease and terminate, and the Receipt or Receipts evidencing such Depositary Shares shall be cancelled.

        No fractional shares or other fractional interests in the Company's common stock or other securities shall be deliverable by the Company upon conversion of the Stock represented by the Depositary Shares.


ARTICLE III

CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY

        Section 3.1.    Filing Proofs, Certificates and Other Information.     Any person presenting Stock for deposit or any holder of a Receipt may be required from time to time to file such proof of residence or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold or delay the delivery of any Receipt, the registration of transfer or redemption of any Receipt, the withdrawal of the Stock represented by the Depositary Shares evidenced by any Receipt, the distribution of any dividend or other distribution or the exercise of any conversion right referred to in Section 2.10, or refuse to accept Receipts that are delivered for surrender, until such proof or other information is filed, such certificates are executed or such representations and warranties are made.

        Section 3.2.    Payment of Taxes or Other Governmental Charges.     If any tax or other governmental charge or fee shall become payable by or on behalf of the Depositary with respect to (i) any Receipt, (ii) the Depositary Shares evidenced by such Receipt, (iii) the Stock (or fractional interest therein) or other property represented by such Depositary Shares, or (iv) any transaction referred to in Section 4.6, such tax (including transfer, issuance or acquisition taxes, if any) or governmental charge or fee shall be payable by the holder of such Receipt, who shall pay the amount thereof to the Depositary. Until such payment is made, registration or transfer of any Receipt or any split-up or combination thereof or any withdrawal of the Stock or money or other property, if any, represented by the Depositary Shares evidenced by such Receipt or Receipts delivered for surrender or the exercise of any conversion right referred to in Section 2.10 may be refused, any dividend or other distribution may be withheld and any part or all of the Stock or other property represented by the Depositary Shares evidenced by such Receipt may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale). Any dividend or other distribution so withheld and the proceeds of any such sale may be applied to any payment of such tax or other governmental charge or fee, the holder of such Receipt remaining liable for any deficiency.

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        Section 3.3.    Withholding.     The Depositary shall act as the tax withholding agent for any payments, distributions made with respect to the Depositary Shares and Receipts, and the Stock. The Depositary shall be responsible with respect to the Depositary Shares, Receipts and Stock for the timely (i) collection and deposit of any required withholding or backup withholding tax, and (ii) filing of any information returns or other documents with federal (and other applicable) taxing authorities.

        Section 3.4.    Representations and Warranties as to Stock.     In the case of the initial deposit of the Stock, the Company and, in the case of subsequent deposits thereof, each person so depositing Stock under this Deposit Agreement shall be deemed thereby to represent and warrant that such Stock and each certificate therefor are valid and that the person making such deposit is duly authorized to do so. Such representations and warranties shall survive the deposit of the Stock and the issuance of Receipts therefor.


ARTICLE IV

THE STOCK, NOTICES

        Section 4.1.    Cash Distributions.     Whenever the Depositary shall receive any cash dividend or other cash distribution on the Stock (other than cash dividends or cash distributions paid by the Company in lieu of fractional shares or other fractional interests in the Company's common stock or other securities otherwise deliverable by the Company in accordance with the applicable Certificate of Designation), the Depositary shall, subject to Section 3.2, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.4 such amounts of such sum as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required by law to withhold and does withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as the case may be, only such amount, however, as can be distributed without attributing to any holder of Depositary Shares a fraction of one cent and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and shall be added to and be treated as part of the next sum received by the Depositary for distribution to record holders of Receipts then outstanding.

        Section 4.2.    Distributions Other Than Cash.     Whenever the Depositary shall receive any distribution other than cash, rights, preferences or privileges upon the Stock, the Depositary shall, subject to Section 3.2, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.4 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary and the Company may deem equitable and practicable for accomplishing such distribution. If, in the opinion of the Company after consultation with the Depositary, such distribution cannot be made proportionately among such record holders, or if for any other reason (including any tax withholding or securities law requirement), the Depositary deems, after consultation with the Company, such distribution not to be feasible, the Depositary may, with the approval of the Company which approval shall not be unreasonably withheld, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.2, be distributed or made available for distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.1 in the case of a distribution received in cash.

        Section 4.3.    Subscription Rights, Preferences or Privileges.     If the Company shall at any time offer or cause to be offered to the persons in whose names Stock is registered on the books of the

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Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance be made available by the Depositary to the record holders of Receipts in such manner as the Company shall instruct (including by the issue to such record holders of warrants representing such rights, preferences or privileges); provided, however, that (i) if at the time of issue or offer of any such rights, preferences or privileges the Company determines and instructs the Depositary that it is not lawful or feasible to make such rights, preferences or privileges available to some or all holders of Receipts (by the issue of warrants or otherwise) or (ii) if and to the extent instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, the Depositary shall then, in each case, and if applicable laws or the terms of such rights, preferences or privileges so permit, sell such rights, preferences or privileges of such holders at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall be distributed by the Depositary to the record holders of Receipts entitled thereto as provided by Section 4.1 in the case of a distribution received in cash.

        If registration under the Securities Act of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold such securities, the Company shall promptly file a registration statement pursuant to the Securities Act with respect to such rights, preferences or privileges and securities and use its reasonable best efforts and take all steps reasonably available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until such registration statement shall have become effective or unless the offering and sale of such securities to such holders are exempt from registration under the provisions of the Securities Act.

        If any other action under the law of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company agrees with the Depositary that the Company will use its reasonable best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges.

        Section 4.4.    Notice of Dividends, Fixing of Record Date for Holders of Receipts.     Whenever (i) any cash dividend or other cash distribution shall become payable, or any distribution other than cash shall be made, or any rights, preferences or privileges shall at any time be offered, with respect to the Stock, or (ii) the Depositary shall receive notice of any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice, or (iii) of any mandatory conversion of, or any election on the part of the Company to call for the redemption or exchange of, any shares of Stock, in accordance with the provisions of the applicable Certificate of Designation or otherwise, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Receipts (x) who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or (y) who shall be entitled to give instructions for the exercise of voting rights at any such meeting or to receive notice of such meeting or of such conversion, exchange or redemption.

        Section 4.5.    Voting Rights.     Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice, which shall be provided by the Company and which shall contain (i) such information as is contained in such notice of meeting, (ii) a statement that the holders of Receipts at the close of business on a specified record date fixed pursuant to Section 4.4 will be entitled, subject to any applicable provision of law, the Certificate of Incorporation or the applicable Certificate of

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Designation, to instruct the Depositary as to the exercise of the voting rights pertaining to the Stock represented by their respective Depositary Shares and (iii) a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of a Receipt on such record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted the Stock represented by the Depositary Shares evidenced by such Receipt in accordance with the instructions set forth in such request. The Company hereby agrees to take all reasonable action that may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting to the extent of the Stock represented by the Depositary Shares evidenced by such Receipt.

        Section 4.6.    Changes Affecting Stock and Reclassifications, Recapitalizations, etc.     Upon any split-up, consolidation or any other reclassification of Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation affecting the Company or to which it is a party or sale of all or substantially all of the Company's assets, the Depositary shall treat any shares of Stock or other securities or property (including cash) that shall be received by the Depositary in exchange for or in conversion of or in respect of the Stock as new deposited property under this Deposit Agreement, and Receipts then outstanding shall thenceforth represent the proportionate interests of holders thereof in the new deposited property so received in exchange for or in respect of such Stock. In any such case the Depositary may, in its discretion, with the approval of the Company, execute and deliver additional Receipts, or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited property.

        Section 4.7.    Reports.     The Company or, at the option of the Company, the Depositary shall forward to the holders of Receipts any reports and communications received from the Company that are received by the Depositary as the holder of Stock.

        Section 4.8.    Lists of Receipt Holders.     Promptly upon request from time to time by the Company, the Depositary shall furnish to it a list, as of a recent date, of the names, addresses and holdings of Depositary Shares of all persons in whose names Receipts are registered on the books of the Depositary, any Depositary's Agent or the Registrar. At the expense of the Company, the Company shall have the right to inspect transfer and registration records of the Depositary, any Depositary's Agent or the Registrar, take copies thereof and require the Depositary, any Depositary's Agent or the Registrar to supply copies of such portions of such records as the Company may request.


ARTICLE V

THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR AND THE COMPANY

        Section 5.1.    Maintenance of Offices, Agencies, Transfer Books by the Depositary; the Registrar.     Upon execution of this Deposit Agreement in accordance with its terms, the Depositary shall maintain (i) at the Corporate Office facilities for the execution and delivery, registration, registration of transfer, surrender, split-up, combination, redemption and conversion of Receipts and deposit and withdrawal of Stock, and (ii) at the offices of the Depositary's Agents, if any, facilities for the delivery, registration, registration of transfer, surrender, split-up, combination, redemption and conversion of Receipts and deposit and withdrawal of Stock, all in accordance with the provisions of this Deposit Agreement.

        The Depositary, acting as transfer agent and Registrar, shall keep books at the Corporate Office for the registration and transfer of Receipts, which books at all reasonable times shall be open for inspection by the record holders of Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to such person's interest as an owner of Depositary Shares. The Depositary shall consult with the Company upon receipt of any request for inspection. The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder.

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        If the Receipts or the Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on one or more securities exchanges, the Depositary shall, with the approval of the Company, appoint a Registrar for registry of such Receipts or Depositary Shares in accordance with the requirements of such exchange or exchanges. Such Registrar (which may be the Depositary if so permitted by the requirements of such exchange or exchanges) may be removed and a substitute Registrar appointed by the Depositary upon the request or with the approval of the Company. In addition, if the Receipts, such Depositary Shares or such Stock are listed on one or more securities exchanges, the Depositary will, at the request of the Company, arrange such facilities for the delivery, registration, registration of transfer, surrender, split-up, combination, redemption and conversion of such Receipts, such Depositary Shares or such Stock as may be required by law or applicable security exchange regulations.

        Section 5.2.    Prevention or Delay in Performance by the Depositary, the Depositary's Agents, the Registrar or the Company.     Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall incur any liability to any holder of any Receipt, if by reason of any provision of any present or future law or regulation thereunder of the United States of America or of any other governmental authority or of any provision, present or future, of the Certificate of Incorporation or the applicable Certificate of Designation or by reason of any act of god or war or other circumstances beyond the control of the relevant party, the Depositary, any Depositary's Agent, the Registrar or the Company shall be prevented or forbidden from doing or performing any act or thing that the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent, the Registrar or the Company incur any liability to any holder of a Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing that the terms of this Deposit Agreement provide shall or may be done or performed, or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement except, in the case of the Depositary, any Depositary's Agent or the Registrar, if any such exercise or failure to exercise discretion is caused by its negligence or willful misconduct.

        Section 5.3.    Obligations of the Depositary, the Depositary's Agents, the Registrar and the Company.     The Company assumes no obligation and shall be subject to no liability under this Deposit Agreement or the Receipts to holders or other persons, except to perform its obligations as are specifically set forth and undertaken by it to perform in this Deposit Agreement without negligence or bad faith. Each of the Depositary, the Depositary's Agents and the Registrar assumes no obligation and shall be subject to no liability under this Deposit Agreement or the Receipts to holders or other persons, except to perform such obligations as are specifically set forth and undertaken by it to perform in this Deposit Agreement without negligence or willful misconduct.

        Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall be liable for any action or any failure to act by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such advice or information. The Depositary, any Depositary's Agent, the Registrar and the Company may each rely and shall each be protected in acting upon any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.

        The Depositary, the Registrar and any Depositary's Agent may own and deal in any class of securities of the Company and its affiliates and in Receipts or Depositary Shares. The Depositary may also act as transfer agent or Registrar of any of the securities of the Company and its affiliates.

        It is intended that neither the Depositary nor any Depositary's Agent nor the Registrar shall be deemed to be an "issuer" of the Stock, the Depositary Shares, or the Receipts or other securities issued upon conversion, exchange or redemption of the Stock under the federal securities laws or applicable state securities laws, it being expressly understood and agreed that the Depositary and any

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Depositary's Agent and the Registrar are acting only in a ministerial capacity; provided, however, that the Depositary and any Depositary's Agent agree to comply with all information reporting and withholding requirements applicable to each of them under law or this Deposit Agreement in their capacity as such.

        Neither the Depositary (or its officers, directors, employees or agents) nor any Depositary's Agent nor the Registrar makes any representation or has any responsibility as to the validity of the registration statement pursuant to which the Depositary Shares are registered under the Securities Act, the Stock, the Depositary Shares or any instruments referred to therein or herein, or as to the correctness of any statement made therein or herein; provided, however, that the Depositary is responsible for its representations in this Deposit Agreement.

        The Depositary assumes no responsibility for the correctness of the description that appears in the Receipts, which can be taken as a statement of the Company summarizing certain provisions of this Deposit Agreement. Notwithstanding any other provision herein or in the Receipts, the Depositary makes no warranties or representations as to the validity, genuineness or sufficiency of any Stock at any time deposited with the Depositary hereunder or of the Depositary Shares, as to the validity or sufficiency of this Deposit Agreement, as to the value of the Depositary Shares or as to any right, title or interest of the record holders of Receipts in and to the Depositary Shares except that the Depositary hereby represents and warrants as follows: (i) the Depositary has been duly organized and is validly existing and in good standing under the laws of the State of            , with full power, authority and legal right under such law to execute, deliver and carry out the terms of this Deposit Agreement; (ii) this Deposit Agreement has been duly authorized, executed and delivered by the Depositary; and (iii) this Deposit Agreement constitutes, and when executed and delivered, each Receipt will constitute, a valid and binding obligation of the Depositary, enforceable against the Depositary in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law). The Depositary shall not be accountable for the use or application by the Company of its proceeds from the Depositary Shares or the Receipts.

        Section 5.4.    Resignation and Removal of the Depositary, Appointment of Successor Depositary.     The Depositary may at any time resign as Depositary hereunder by written notice to the Company of its election to do so, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided.

        The Depositary may at any time be removed by the Company by written notice to the Depositary of such removal, such removal to take effect upon the appointment of a successor depositary and its acceptance of such appointment as hereinafter provided.

        In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor depositary, which shall be a bank or trust company, or an affiliate of a bank or trust company, having its principal office in the United States of America and having a combined capital and surplus of at least $50,000,000. If a successor depositary shall not have been appointed in 60 days, the resigning or removed Depositary may petition a court of competent jurisdiction to appoint a successor depositary. Every successor depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it and on the written request of the Company, shall promptly execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all rights, title

13


and interest in the Stock and any moneys or property held hereunder to such successor and shall deliver to such successor a list of the record holders of all outstanding Receipts. Any successor Depositary shall promptly mail notice of its appointment to the record holders of Receipts.

        Any corporation into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act. Such successor Depositary may execute the Receipts either in the name of the predecessor Depositary or in the name of the successor Depositary.

        Section 5.5.    Corporate Notices and Reports.     The Company agrees that it will deliver to the Depositary, and the Depositary will, promptly after receipt thereof, transmit to the record holders of Receipts, in each case at the address recorded in the Depositary's books or the books of any Depositary's Agent or the Registrar, copies of all notices and reports (including financial statements) required by law, by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed or by the Certificate of Incorporation or the applicable Certificate of Designation to be furnished by the Company to holders of Stock. Such transmission will be at the Company's expense and the Company will provide the Depositary with such number of copies of such documents as the Depositary may reasonably request. In addition, the Depositary will transmit to the record holders of Receipts at the Company's expense such other documents as may be requested by the Company.

        Section 5.6.    Deposit of Stock by the Company.     The Company agrees with the Depositary that neither the Company nor any Company controlled by the Company will at any time deposit any Stock if such Stock is required to be registered under the provisions of the Securities Act and no registration statement is at such time in effect as to such Stock.

        Section 5.7.    Indemnification by the Company.     The Company shall indemnify the Depositary for, and hold it harmless against, any loss, liability, claim or expense ("Loss") arising out of or in connection with its duties under this Deposit Agreement, including the reasonable costs and expenses of defending itself against Loss, unless such Loss shall have been determined by a court of competent jurisdiction to be a result of the Depositary's negligence or willful misconduct.

        Section 5.8.    Fees, Charges and Expenses.     No fees, charges and expenses of the Depositary or any Depositary's Agent hereunder or of any Registrar shall be payable by any person other than the Company, except for any taxes and other governmental charges and except as provided in this Deposit Agreement. If, at the request of a holder of a Receipt, the Depositary incurs fees, charges or expenses for which it is not otherwise liable hereunder, such holder or other person will be liable for such fees, charges and expenses. All other fees, charges and expenses of the Depositary and any Depositary's Agent hereunder and of any Registrar (including, in each case, reasonable fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid from time to time upon consultation and agreement between the Depositary and the Company as to the amount and nature of such fees, charges and expenses.


ARTICLE VI

AMENDMENT AND TERMINATION

        Section 6.1.    Amendment.     The form of the Receipts and any provision of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect that they may deem necessary or desirable, including to reflect the terms of any Certificate of Designation; provided, however, that no such amendment that shall materially and adversely alter the rights of the holders of Receipts shall be effective as to outstanding Receipts until the expiration of 90 days after notice of such amendment shall have been given to the record holders of outstanding Receipts. Each holder of an outstanding Receipt at the time any such

14

amendment becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by this Deposit Agreement as amended thereby. In no event shall any amendment impair the right, subject to the provisions of this Deposit Agreement, of any holder of any Depositary Shares to surrender the Receipt evidencing such Depositary Shares with instructions to the Depositary to deliver to the holder the Stock or to cause the conversion of such Stock into the Company's common stock or other securities in accordance with the applicable Certificate of Designation and to deliver all securities, money and other property, if any, represented thereby, except in order to comply with mandatory provisions of applicable law.

        Section 6.2.    Termination.     This Deposit Agreement may be terminated by either the Company or the Depositary, upon notice to the other, only if (i) all of the outstanding Depositary Shares have been redeemed or converted for any other securities into which the Stock is convertible, or (ii) there has been a final distribution of the Stock to the holders of Receipts in connection with the Company's liquidation, dissolution or winding up. The Depositary will mail notice of such termination to the record holders of all Receipts then outstanding at least 30 days prior to the date fixed in such notice for such termination. If any Receipts shall remain outstanding after the date of termination of this Deposit Agreement, the Depositary thereafter shall discontinue the transfer of Receipts, and shall not give any further notices or perform any further acts under this Deposit Agreement, except that the Depositary shall continue to deliver the Stock and any money and other property represented by Receipts, without liability for interest thereon, upon surrender thereof by the holders thereof, and the Depositary shall be discharged from all obligations under this Deposit Agreement except to account for such Stock, money and other property. Upon the termination of this Deposit Agreement, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary, any Depositary's Agent and any Registrar under Sections 5.7 and 5.8.


ARTICLE VII

MISCELLANEOUS

        Section 7.1.    Counterparts.     This Deposit Agreement may be executed by the Company and the Depositary in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Deposit Agreement by telecopier shall be effective as delivery of a manually executed counterpart of this Deposit Agreement. Copies of this Deposit Agreement shall be filed with the Depositary and the Depositary's Agents and shall be open to inspection during business hours at the Corporate Office and the respective offices of the Depositary's Agents, if any, by any holder of a Receipt.

        Section 7.2.    Exclusive Benefits of Parties.     This Deposit Agreement is for the exclusive benefit of the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever.

        Section 7.3.    Invalidity of Provisions.     In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby.

        Section 7.4.    Notices.     Any notices to be given to the Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail (first class postage prepaid), by a nationally recognized overnight courier service, or by telecopier confirmed by letter, addressed to the Company at 1700 Old Meadow Road, McLean, VA 22102, Attention: General Counsel, or at any other place to which the Company may have transferred its principal executive office.

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        Any notices to be given to the Depositary hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail (first class postage), by a nationally recognized overnight courier service, or by telecopier confirmed by letter, addressed to the Depositary at the Corporate Office.

        Except as provided in the next paragraph, any notices given to any record holder of a Receipt hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail (first class postage), by a nationally recognized overnight courier service or by telecopier confirmed by letter, addressed to such record holder at the address of such record holder as it appears on the books of the Depositary or, if such holder shall have filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request.

        In addition, whenever the Certificate of Designation requires any notice to be published, the Depositary will, if requested by the Company, cause such notice to be published in the manner directed by the Company.

        Delivery of a notice sent by mail, by overnight courier or by telecopier shall be deemed to be effected at the time when a duly addressed letter containing the same (or a duly addressed letter confirming an earlier notice in the case of a telecopier message) is deposited, postage prepaid, in a post office letter box or with the overnight courier service. The Depositary or the Company may, however, act upon any telecopier message received by it from the other or from any holder of a Receipt, notwithstanding that such telecopier message shall not subsequently be confirmed by letter as aforesaid.

        Section 7.5.    Depositary's Agents.     The Depositary may, with the approval of the Company which approval shall not be unreasonably withheld, from time to time appoint one or more Depositary's Agents to act in any respect for the Depositary for the purposes of this Deposit Agreement and may vary or terminate the appointment of such Depositary's Agents.

        Section 7.6.    Holders of Receipts Are Parties.     Notwithstanding that holders of Receipts have not executed and delivered this Deposit Agreement or any counterpart thereof, the holders of Receipts from time to time shall be deemed to be parties to this Deposit Agreement and shall be bound by all of the terms and conditions, and be entitled to all of the benefits, hereof and of the Receipts by acceptance of delivery of Receipts.

        Section 7.7.    Governing Law.     This Deposit Agreement and the Receipts and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by, and construed in accordance with, the law of the State of New York without giving effect to principles of conflict of laws.

        Section 7.8.    Headings.     The headings of articles and sections in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts.

16

        IN WITNESS WHEREOF, Primus Telecommunications Group, Incorporated and                         have duly executed this Deposit Agreement as of the day and year first above set forth and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof.


 
 
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
By:
  
Authorized Officer

 
 
                                                                         , as Depositary

 
 
By:
  
Authorized Officer


[SIGNATURE PAGE TO DEPOSIT AGREEMENT]

Exhibit A to Deposit Agreement


[FORM OF DEPOSITARY RECEIPT]

        [Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the Company or its agent for registration of transfer, conversion, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL in as much as the registered owner hereof, Cede & Co., has an interest herein.]

DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES
EACH REPRESENTING            OF A SHARE OF
                        PREFERRED STOCK, SERIES   
OF

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

No.            CUSIP:                         

                                 (the "Depositary") hereby certifies that [Cede & Co.]                         is the registered holder of                          Depositary Shares (the "Depositary Shares"), each Depositary Share representing                         of a share of                         Preferred Stock, Series     , $0.01 par value (the "Stock"), of Primus Telecommunications Group, Incorporated, a corporation duly organized and existing under the laws of the State of Delaware (the "Company"), deposited with the Depositary and the same proportionate interest in any and all other property received by the Depositary in respect of such shares of Stock and held by the Depositary under the Deposit Agreement (as defined below). Subject to the terms of the Deposit Agreement, each owner of a Depositary Share is entitled, proportionately, to all the rights, preferences and privileges, and subject to all the limitations and restrictions, of the Stock represented thereby, including any dividend, voting, conversion, redemption, liquidation and sinking fund rights contained in the Certificate of Designation establishing the rights, preferences, privileges, limitations and restrictions of the Stock (the "Certificate of Designation"), copies of which are on file at the office of the Depositary in [the City of New York, Borough of Manhattan]                                      at which at any particular time its business in respect of matters governed by the Deposit Agreement shall be administered, which at the time of the execution of the Deposit Agreement is located at                         (the "Corporate Office").

        This Depositary Receipt ("Receipt") shall not be entitled to any benefits under the Deposit Agreement or be valid or obligatory for any purpose unless this Receipt shall have been executed manually or, if a Registrar for the Receipts (other than the Depositary) shall have been appointed, by facsimile by the Depositary by the signature of a duly authorized officer and, if executed by facsimile signature of the Depositary, shall have been countersigned manually by such Registrar by the signature of a duly authorized officer.

        THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY DEPOSITED STOCK. THE DEPOSITARY ASSUMES NO RESPONSIBILITY FOR THE CORRECTNESS OF THE DESCRIPTION SET FORTH IN THIS RECEIPT, WHICH CAN BE TAKEN AS A STATEMENT OF THE COMPANY SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT AGREEMENT. UNLESS EXPRESSLY SET FORTH IN THE DEPOSIT AGREEMENT, THE DEPOSITARY MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE VALIDITY,

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GENUINENESS OR SUFFICIENCY OF ANY STOCK AT ANY TIME DEPOSITED WITH THE DEPOSITARY UNDER THE DEPOSIT AGREEMENT OR OF THE DEPOSITARY SHARES, AS TO THE VALIDITY OR SUFFICIENCY OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE DEPOSITARY SHARES OR AS TO ANY RIGHT, TITLE OR INTEREST OF THE RECORD HOLDERS OF THE RECEIPTS IN AND TO THE DEPOSITARY SHARES.

        The Company will furnish to any holder of this Receipt without charge, upon request addressed to its executive office, a full statement of the designation, relative rights, preferences, privileges, limitations and restrictions of the shares of each authorized class, and of each class of preferred stock authorized to be issued, so far as the same may have been fixed, and a statement of the authority of the board of directors of the Company to designate and fix the relative rights, preferences, privileges, limitations and restrictions of other classes.

        This Receipt is continued on the reverse hereof and the additional provisions therein set forth for all purposes have the same effect as if set forth at this place.


Dated:
  
  
 

as Depositary and Registrar
,

By:
  
Authorized Officer
 

        Further Conditions and Agreements Forming Part of this Receipt Appear on the Reverse Side.

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[REVERSE OF DEPOSITARY RECEIPT]

        1.    The Deposit Agreement.     Receipts, of which this Receipt is one, are made available upon the terms and conditions set forth in the Deposit Agreement, dated as of                          (the "Deposit Agreement"), among the Company, the Depositary and all holders from time to time of Receipts. The Deposit Agreement (copies of which are on file at the Corporate Office and at the office of any agent of the Depositary) sets forth the rights of holders of Receipts and the rights and duties of the Depositary. The statements made on the face and the reverse of this Receipt are summaries of certain provisions of the Deposit Agreement and are subject to the detailed provisions thereof, to which reference is hereby made. In the event of any conflict between the provisions of this Receipt and the provisions of the Deposit Agreement, the provisions of the Deposit Agreement will govern.

        2.    Definitions.     Unless otherwise expressly herein provided, all defined terms used herein shall have the meanings ascribed thereto in the Deposit Agreement.

        3.    Redemption by the Company; Repurchase by the Company.     Whenever the Company shall redeem shares of Stock in accordance with a Certificate of Designation, it shall (unless otherwise agreed in writing with the Depositary) give the Depositary in its capacity as Depositary not less than 3 business days' prior notice of the proposed date of the mailing of a notice of redemption of Stock and the simultaneous redemption of the Depositary Shares representing the Stock to be redeemed and of the number of such shares of Stock held by the Depositary to be redeemed. Unless the Certificate of Designation for a specific series of Stock provides for a different notice period with respect to that Stock in the event of its redemption, the Depositary shall, as directed by the Company in writing, mail, first class postage prepaid, notice of the redemption not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares, to the record holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as the same appear on the records of the Depositary or any Depositary's Agent or Registrar. Notwithstanding the foregoing, neither failure to mail or publish any such notice to one or more such holders nor any defect in any notice shall affect the sufficiency of the proceedings for redemption. On the date of any such redemption, the Depositary shall surrender the certificate or certificates held by the Depositary evidencing the number of shares of Stock to be redeemed in the manner specified in the notice of redemption. The Depositary shall, thereafter, redeem the number of Depositary Shares representing such redeemed Stock upon the surrender of Receipts evidencing such Depositary Shares in the manner provided in the notice sent to record holders of Receipts. Notice having been mailed as aforesaid, from and after the redemption date (unless the Company shall have failed to redeem the shares of Stock to be redeemed by it upon the surrender of the certificate or certificates therefor by the Depositary as described above), the Depositary Shares called for redemption shall be deemed no longer to be outstanding and all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the cash, securities or other property payable upon redemption upon surrender of such Receipts) shall, to the extent of such Depositary Shares, cease and terminate. The foregoing shall be subject further to the terms and conditions of the applicable Certificate of Designation.

        Whenever the Company shall be required to make an offer to repurchase Depositary Shares in accordance with a Certificate of Designation, it shall (unless otherwise agreed in writing with the Depositary) give the Depositary in its capacity as Depositary not less than 3 business days' prior notice of the required date of the mailing of a notice of the repurchase offer. The Depositary shall, as directed by the Company in writing, mail, first class postage prepaid, notice of the relevant terms of the repurchase offer, as provided by the Company, to the record holders of the Receipts at the addresses of such holders as the same appear on the records of the Depositary or any Depositary's Agent or Registrar. The Depositary shall, thereafter, receive from each holder electing to have Depositary Shares repurchased pursuant to the repurchase offer in accordance with the instructions in the notice, the holder's Receipts, with an appropriate form duly completed prior to the repurchase date. In case the

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aggregate number of Depositary Shares offered for repurchase by the holders exceeds the amount of Depositary Shares which the Company has offered to repurchase pursuant to the repurchase offer, the Depositary Shares to be repurchased shall be selected by the Depositary by lot or proportionately, as may be determined by the Depositary. The foregoing is subject further to the terms and conditions of the applicable Certificate of Designation.

        4.    Conversion.     In the event that the Stock, in accordance with its Certificate of Designation, is convertible into the Company's common stock or other securities, subject to the terms and conditions of the Deposit Agreement, a holder of a Receipt or Receipts may surrender such Receipt or Receipts at the Corporate Office or at such other office or to a Depositary's Agent that the Depositary may designate for such purpose, together with a notice of conversion duly completed and executed, thereby directing the Depositary or such Depositary's Agent to instruct the Company to cause the conversion of the number of shares of Stock specified in such notice of conversion into shares of the Company's common stock or other securities at the rate specified in the applicable Certificate of Designation, and an assignment of such Receipt or Receipts to the Company or in blank, duly completed and executed, along with any other documents or instruments and any amounts required by the applicable Certificate of Designation.

        Upon receipt by the Depositary or a Depositary's Agent of a Receipt or Receipts of such notice, assignment and other documents, instruments or amounts, the Depositary or such Depositary's Agent shall instruct the Company, subject to any adjustment provided for in the applicable Certificate of Designation, (i) to cause the conversion at the rate specified in the applicable Certificate of Designation of the number of shares of Stock evidenced by the Receipt or Receipts so surrendered for conversion as specified in the written notice to the Depositary or such Depositary's Agent and (ii) to cause the delivery to the holder of such Receipt or Receipts of (a) a certificate or certificates evidencing the number of whole shares of the Company's common stock or other securities into which such Stock has been converted, and (b) the amount of cash or other property, if any, to which such holder is entitled in lieu of fractional shares of, or fractional interests in, the Company's common stock or other securities otherwise deliverable by the Company upon such conversion, calculated in accordance with the applicable Certificate of Designation. Upon such conversion, the Depositary or such Depositary's Agent (i) shall deliver to the holder a Receipt evidencing the number of Depositary Shares evidenced by the surrendered Receipt or Receipts in excess of the number of Depositary Shares evidenced by such Receipt or Receipts that have been so converted, (ii) shall cancel the Receipts surrendered for conversion and (iii) shall deliver to the Company for cancellation the number of shares of Stock evidenced by the Receipts so surrendered and so converted.

        Upon the conversion of any Stock for which a notice of conversion has been provided to the Depositary or a Depositary's Agent by the holder of the Receipt or Receipts representing such Stock, the Depositary Shares evidenced by such Receipt or Receipts shall be deemed no longer outstanding, all rights of the holder of the Receipt or Receipts evidencing such Depositary Shares (except the right to receive (i) the Company's common stock or other securities to which such holder is entitled upon conversion in accordance with the applicable Certificate of Designation, (ii) any cash or other property payable in accordance with the applicable Certificate of Designation with respect to any fractional shares or other fractional interests in the Company's common stock or other securities otherwise deliverable by the Company upon conversion, (iii) any Receipts evidencing Depositary Shares representing Stock which was not so converted and (iv) any other securities, property or cash to which such holder is entitled under this Deposit Agreement) shall cease and terminate, and the Receipt or Receipts evidencing such Depositary Shares shall be cancelled.

        No fractional shares or other fractional interests in the Company's common stock or other securities shall be deliverable by the Company upon conversion of the Stock represented by the Depositary Shares.

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        5.    Withdrawal of Stock.     Holders of Receipts shall have the right, upon payment of any amount due to the Depositary with respect to the Receipts, to withdraw any or all of the Stock (but only in whole shares of Stock) represented by the Depositary Shares and all money and other property, if any, represented by such Depositary Shares by surrendering the Receipt or Receipts evidencing such Depositary Shares at the Corporate Office, or at such other offices as the Depositary may designate for such withdrawal (and cancellation of the surrendered Receipts as provided in the Deposit Agreement).

        6.    Transfers, Split-ups, Combinations.     Subject to Paragraphs 7, 8 and 9 below, this Receipt is transferable on the books of the Depositary upon surrender of this Receipt to the Depositary at the Corporate Office or at such other offices as the Depositary may designate for such purchase, properly endorsed or accompanied by a properly executed instrument of transfer, together with evidence of the payment of any transfer taxes as may be required by law, and upon such transfer the Depositary shall execute and deliver a Receipt or Receipts to or upon the order of the person entitled thereto, all as provided in and subject to the Deposit Agreement. Subject to the Deposit Agreement, this Receipt may be split into other Receipts or combined with other Receipts into one Receipt evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered; provided, however, that the Depositary shall not issue any Receipt evidencing a fractional Depositary Share.

        7.    Conditions to Signing and Delivery, Transfer, etc., of Receipts.     Prior to the execution and delivery, registration of transfer, split-up, combination, or surrender of this Receipt, the delivery of any distribution hereon or withdrawal or deposit of the Stock evidenced hereby, or the exercise of any applicable conversion right, the Depositary, any of the Depositary's Agents, the Registrar or the Company may require any or all of the following: (i) payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any tax or other governmental charge or fee with respect thereto (including any such tax or charge or fee with respect to Stock being deposited or withdrawn or with respect to other property of the Company being issued upon redemption or conversion); (ii) production of proof satisfactory to it as to the identity and genuineness of any signature; and (iii) compliance with such reasonable regulations, if any, as the Depositary or the Company may establish not inconsistent with the Deposit Agreement. Any person presenting Stock for deposit, or any holder of this Receipt, may be required to file such proof of residence or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold or delay the delivery of this Receipt, the registration of transfer or redemption of this Receipt, the withdrawal of the Stock represented by the Depositary Shares evidenced by this Receipt, the distribution of any dividend or other distribution or the exercise of any applicable conversion right, until such proof or other information is filed, such certificates are executed or such representations and warranties are made.

        8.    Suspension of Delivery, Transfer, etc.     The registration of transfer, split-up, combination or surrender of this Receipt and the withdrawal of deposited Stock or the exercise of any applicable conversion right may be suspended (i) during any period when the register of stockholders of the Company is closed, (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of the Deposit Agreement, or (iii) with the approval of the Company, for any other reason.

        9.    Payment of Taxes or Other Governmental Charges.     If any tax or other governmental charge or fee shall become payable by or on behalf of the Depositary with respect to (i) this Receipt, (ii) the Depositary Shares evidenced by this Receipt, (iii) the Stock (or fractional interest therein) or other property represented by such Depositary Shares, or (iv) any transaction referred to in Section 4.6 of the Deposit Agreement, such tax (including transfer, issuance or acquisition taxes, if any) or governmental charge or fee shall be payable by the holder of this Receipt, who shall pay the amount thereof to the Depositary. Until such payment is made, registration or transfer of this Receipt or any split-up or

A-5

combination of this Receipt or any withdrawal of the Stock or money or other property, if any, represented by the Depositary Shares evidenced by this Receipt upon its surrender or the exercise of any applicable conversion right may be refused, any dividend or other distribution may be withheld and any part or all of the Stock or other property represented by the Depositary Shares evidenced by this Receipt may be sold for the account of the holder hereof (after attempting by reasonable means to notify such holder prior to such sale). Any dividend or other distribution so withheld and the proceeds of any such sale may be applied to any payment of such tax or other governmental charge or fee, the holder of this Receipt remaining liable for any deficiency.

        10.    Amendment.     The form of the Receipts and any provision of the Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect that they may deem necessary or desirable, including to reflect the terms of any Certificate of Designation; provided, however, that no such amendment that shall materially and adversely alter the rights of the holders of Receipts shall be effective as to outstanding Receipts until the expiration of 90 days after notice of such amendment shall have been given to the record holders of outstanding Receipts. Each holder of an outstanding Receipt at the time any such amendment becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby. In no event shall any amendment impair the right, subject to the provisions of the Deposit Agreement, of the holder of the Depositary Shares evidenced by this Receipt to surrender this Receipt with instructions to the Depositary to deliver to the holder the Stock or to cause the conversion of such Stock into the Company's common stock or other securities in accordance with the applicable Certificate of Designation and to deliver all securities, money and other property, if any, represented thereby, except in order to comply with mandatory provisions of applicable law.

        11.    Fees, Charges and Expenses.     The Company will pay all fees, charges and expenses of the Depositary, except for taxes and other governmental charges and such charges as are otherwise expressly provided for in the Deposit Agreement.

        12.    Title to Receipts.     It is a condition of this Receipt, and every successive holder hereof by accepting or holding the same consents and agrees, that title to this Receipt (and to the Depositary Shares evidenced hereby), when properly endorsed or accompanied by a properly executed instrument of transfer, is transferable by delivery with the same effect as in the case of investment securities in general; provided, however, that the Depositary may, notwithstanding any notice to the contrary, treat the record holder hereof at such time as the absolute owner hereof for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in the Deposit Agreement and for all other purposes.

        13.    Dividends and Distributions.     Whenever the Depositary shall receive any cash dividend or other cash distribution on the Stock (other than cash dividends or cash distributions paid by the Company in lieu of fractional shares or other fractional interests in the Company's common stock or other securities otherwise deliverable by the Company in accordance with the applicable Certificate of Designation), the Depositary shall, subject to the provisions of the Deposit Agreement, distribute to record holders of Receipts on the record date fixed pursuant to paragraph 15 such amounts of such sums as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required by law to withhold and does withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as the case may be, only such amount, however, as can be distributed without attributing to any holder of Depositary Shares a fraction of one cent and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and

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shall be added to and be treated as part of the next sum received by the Depositary for distribution to record holders of Receipts then outstanding.

        14.    Subscription Rights, Preferences or Privileges.     If the Company shall at any time offer or cause to be offered to the persons in whose name Stock is registered on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance, subject to the provisions of the Deposit Agreement, be made available by the Depositary to the record holders of Receipts in such manner as the Company shall instruct.

        15.    Notice of Dividends, Fixing of Record Date.     Whenever (i) any cash dividend or other cash distribution shall become payable, or any distribution other than cash shall be made, or any rights, preferences or privileges shall at any time be offered, with respect to the Stock, or (ii) the Depositary shall receive notice of any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice, or (iii) of any mandatory conversion of, or any election on the part of the Company to call for redemption or exchange of, any shares of Stock, in accordance with the applicable Certificate of Designation or otherwise, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Receipts (x) who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or (y) who shall be entitled to give instructions for the exercise of voting rights at any such meeting or to receive notice of such meeting or of such conversion, exchange or redemption.

        16.    Voting Rights.     Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice, which shall contain (i) such information as is contained in such notice of meeting, (ii) a statement that the holders of Receipts at the close of business on a specified record date determined as provided in paragraph 15 will be entitled, subject to any applicable provision of law, the Certificate of Incorporation or the applicable Certificate of Designation, to instruct the Depositary as to the exercise of the voting rights pertaining to the Stock represented by their respective Depositary Shares, and (iii) a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of this Receipt on such record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted the Stock represented by the Depositary Shares evidenced by this Receipt in accordance with the instructions set forth in such request. The Company hereby agrees to take all reasonable action that may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of this Receipt, the Depositary will abstain from voting to the extent of the Stock represented by the Depositary Shares evidenced by this Receipt.

        17.    Reports, Inspection of Transfer Books.     The Company agrees that it will deliver to the Depositary, and the Depositary will, promptly after receipt thereof, transmit to the record holders of Receipts, in each case at the address recorded in the Depositary's books or the books of any Depositary's Agent or the Registrar, copies of all notices and reports (including financial statements) required by law, by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed or by the Certificate of Incorporation or the applicable Certificate of Designation to be furnished by the Company to holders of Stock. The Depositary, acting as transfer agent and Registrar, shall keep books at the Corporate Office for the registration and transfer of Receipts, which books at all reasonable times shall be open for inspection by the record holders of Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to such person's interest as an owner of Depositary Shares.

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        18.    Liability of the Depositary, the Depositary's Agents, the Registrar and the Company.     Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall incur any liability to any holder of this Receipt, if by reason of any provision of any present or future law or regulation thereunder of any governmental authority or of any provision, present or future, of the Certificate of Incorporation or the applicable Certificate of Designation or by reason of any act of god or war or other circumstances beyond the control of the relevant party, the Depositary, any Depositary's Agent, the Registrar or the Company shall be prevented or forbidden from doing or performing any act or thing that the terms of the Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent, the Registrar or the Company incur any liability to any holder of this Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing that the terms of the Deposit Agreement provide shall or may be done or performed or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement except, in the case of the Depositary, any Depositary's Agent or the Registrar, if such exercise or failure to exercise discretion is caused by its negligence or willful misconduct.

        19.    Obligations of the Depositary, the Depositary's Agent, the Registrar and the Company.     The Company assumes no obligation and shall be subject to no liability under the Deposit Agreement or this Receipt to the holder hereof or other persons, except to perform its obligations as are specifically set forth and undertaken by it to perform in the Deposit Agreement without negligence or bad faith. Each of the Depositary, the Depositary's Agents and the Registrar assumes no obligation and shall be subject to no liability under the Deposit Agreement or this Receipt to the holder hereof or other persons, except to perform such obligations as are specifically set forth and undertaken by it to perform in the Deposit Agreement without negligence or willful misconduct.

        Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall be liable for any action or failure to act by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Stock for deposit, any holder of this Receipt or any other person believed by it in good faith to be competent to give such advice or information.

        20.    Termination of Deposit Agreement.     The Deposit Agreement may be terminated only if (i) all of the outstanding Depositary Shares have been redeemed or converted for any other securities into which the Stock is convertible or (ii) there has been a final distribution of the Stock to the holders of Receipts in connection with the Company's liquidation, dissolution or winding up. The Depositary will mail notice of such termination to the record holders of all Receipts then outstanding at least 30 days prior to the date fixed in such notice for such termination. Upon the termination of the Deposit Agreement, the Company shall be discharged from all obligations thereunder except for its obligations to the Depositary, any Depositary's Agent and any Registrar under Sections 5.7 and 5.8 of the Deposit Agreement.

        If any Receipts remain outstanding after the date of termination of the Deposit Agreement, the Depositary thereafter shall discontinue all functions and be discharged from all obligations as provided in the Deposit Agreement, except as specifically provided therein.

        21.    Governing Law.     The Deposit Agreement and this Receipt and all rights thereunder and hereunder and provisions thereof and hereof shall be governed by, and construed in accordance with, the law of the State of New York without giving effect to principles of conflict of laws.

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FORM OF ASSIGNMENT

        FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                         the within Receipt and all rights and interests represented by the Depositary Shares evidenced thereby, and hereby irrevocably constitutes and appoints                         attorney, to transfer the same on the books of the within-named Depositary, with full power of substitution in the premises.


Dated:
 
Signature:
  

 
 
NOTE:    The signature to this assignment must correspond with the name as written upon the face of the Receipt in every particular, without alteration or enlargement, or any change whatever.


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TABLE OF CONTENTS
DEPOSIT AGREEMENT
ARTICLE I DEFINITIONS
ARTICLE II FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND DELIVERY, TRANSFER, SURRENDER AND REDEMPTION AND REPURCHASE OF RECEIPTS
Section 2.1. Form and Transfer of Receipts.
Section 2.2. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof.
Section 2.3. Redemption and Repurchase of Stock.
Section 2.4. Register of Transfer of Receipts.
Section 2.5. Combination and Split-ups of Receipts.
Section 2.6. Surrender of Receipts and Withdrawal of Stock.
Section 2.7. Limitations on Execution and Delivery, Transfer, Split-up, Combination and Surrender of Receipts and Withdrawal or Deposit of Stock.
Section 2.8. Lost Receipts, etc.
Section 2.9. Cancellation and Destruction of Surrendered Receipts.
Section 2.10. Conversion.
ARTICLE III CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY
Section 3.1. Filing Proofs, Certificates and Other Information.
Section 3.2. Payment of Taxes or Other Governmental Charges.
Section 3.3. Withholding.
Section 3.4. Representations and Warranties as to Stock.
ARTICLE IV THE STOCK, NOTICES
Section 4.1. Cash Distributions.
Section 4.2. Distributions Other Than Cash.
Section 4.3. Subscription Rights, Preferences or Privileges.
Section 4.4. Notice of Dividends, Fixing of Record Date for Holders of Receipts.
Section 4.5. Voting Rights.
Section 4.6. Changes Affecting Stock and Reclassifications, Recapitalizations, etc.
Section 4.7. Reports.
Section 4.8. Lists of Receipt Holders.
ARTICLE V THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR AND THE COMPANY
Section 5.1. Maintenance of Offices, Agencies, Transfer Books by the Depositary; the Registrar.
Section 5.2. Prevention or Delay in Performance by the Depositary, the Depositary's Agents, the Registrar or the Company.
Section 5.3. Obligations of the Depositary, the Depositary's Agents, the Registrar and the Company.
Section 5.4. Resignation and Removal of the Depositary, Appointment of Successor Depositary.
Section 5.5. Corporate Notices and Reports.
Section 5.6. Deposit of Stock by the Company.
Section 5.7. Indemnification by the Company.
Section 5.8. Fees, Charges and Expenses.
ARTICLE VI AMENDMENT AND TERMINATION
Section 6.1. Amendment.
Section 6.2. Termination.
ARTICLE VII MISCELLANEOUS
Section 7.1. Counterparts.
Section 7.2. Exclusive Benefits of Parties.
Section 7.3. Invalidity of Provisions.
Section 7.4. Notices.
Section 7.5. Depositary's Agents.
Section 7.6. Holders of Receipts Are Parties.
Governing Law
Section 7.7. Governing Law.
Headings
Section 7.8. Headings.
[FORM OF DEPOSITARY RECEIPT]
[REVERSE OF DEPOSITARY RECEIPT]
1. The Deposit Agreement.
2. Definitions.
3. Redemption by the Company; Repurchase by the Company.
4. Conversion.
5. Withdrawal of Stock.
6. Transfers, Split-ups, Combinations.
7. Conditions to Signing and Delivery, Transfer, etc. , of Receipts.
8. Suspension of Delivery, Transfer, etc.
9. Payment of Taxes or Other Governmental Charges.
10. Amendment.
11. Fees, Charges and Expenses.
12. Title to Receipts.
13. Dividends and Distributions.
14. Subscription Rights, Preferences or Privileges.
15. Notice of Dividends, Fixing of Record Date.
16. Voting Rights.
17. Reports, Inspection of Transfer Books.
18. Liability of the Depositary, the Depositary's Agents, the Registrar and the Company.
19. Obligations of the Depositary, the Depositary's Agent, the Registrar and the Company.
20. Termination of Deposit Agreement.
21. Governing Law.
FORM OF ASSIGNMENT

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Exhibit 4.7

        PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

and

                                    , As Warrant Agent

FORM OF COMMON STOCK
WARRANT AGREEMENT

Dated As Of                                    


TABLE OF CONTENTS

 
    
   Page
ARTICLE 1   ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES   1
    1.1   Issuance of Warrants   1
    1.2   Execution and Delivery of Warrant Certificates   1
    1.3   Issuance of Warrant Certificates   2

ARTICLE 2
 
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
 
3
    2.1   Warrant Price   3
    2.2   Duration of Warrants   3
    2.3   Exercise of Warrants   3

ARTICLE 3
 
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
 
4
    3.1   No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates   4
    3.2   Lost, Stolen, Mutilated or Destroyed Warrant Certificates   4
    3.3   Holder of Warrant Certificate May Enforce Rights   4
    3.4   Adjustments   4
    3.5   Notice to Warrantholders   6
    3.6   [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company   7]

ARTICLE 4
 
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
 
7
    4.1   Exchange and Transfer of Warrant Certificates   7
    4.2   Treatment of Holders of Warrant Certificates   8
    4.3   Cancellation of Warrant Certificates   8

ARTICLE 5
 
CONCERNING THE WARRANT AGENT
 
8
    5.1   Warrant Agent   8
    5.2   Conditions of Warrant Agent's Obligations   9
    5.3   Resignation and Appointment of Successor   10

ARTICLE 6
 
MISCELLANEOUS
 
11
    6.1   Amendment   11
    6.2   Notices and Demands to the Company and Warrant Agent   11
    6.3   Addresses   11
    6.4   Governing Law   11
    6.5   Delivery of Prospectus   11
    6.6   Obtaining of Governmental Approvals   11
    6.7   Persons Having Rights Under Warrant Agreement   12
    6.8   Headings   12
    6.9   Counterparts   12
    6.10   Inspection of Agreement   12

i


PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
Form of Common Stock Warrant Agreement

        COMMON STOCK WARRANT AGREEMENT, dated as of            between PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a Delaware corporation (the "Company") and                        , a [corporation] [national banking association] organized and existing under the laws of            and having a corporate trust office in            , as warrant agent (the "Warrant Agent").

        WHEREAS, the Company proposes to sell [if Warrants are sold with other securities—[title of such other securities being offered] (the "Other Securities") with] warrant certificates evidencing one or more warrants (the "Warrants" or individually a "Warrant") representing the right to purchase Common Stock of the Company, par value $0.01 per share (the "Warrant Securities"), such warrant certificates and other warrant certificates issued pursuant to this Agreement being herein called the "Warrant Certificates"; and

        WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to set forth, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced;

        NOW THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows:


ARTICLE 1

ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES

        1.1    Issuance of Warrants.     [If Warrants alone—Upon issuance, each Warrant Certificate shall evidence one or more Warrants.] [If Other Securities and Warrants—Warrants shall be [initially] issued in connection with the issuance of the Other Securities [but shall be separately transferable on and after                        (the "Detachable Date")] [and shall not be separately transferable] and each Warrant Certificate shall evidence one or more Warrants.] Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase one Warrant Security. [If Other Securities and Warrants—Warrant Certificates shall be initially issued in units with the Other Securities and each Warrant Certificate included in such a unit shall evidence            Warrants for each [$            principal amount] [            shares] of Other Securities included in such unit.]

        1.2    Execution and Delivery of Warrant Certificates.     Each Warrant Certificate, whenever issued, shall be in registered form substantially in the form set forth in Exhibit A hereto, shall be dated the date of its countersignature by the Warrant Agent and may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced thereon. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a

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facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.

        No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence that the Warrant Certificate so countersigned has been duly issued hereunder.

        In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.

        The term "holder" or "holder of a Warrant Certificate" as used herein shall mean any person in whose name at the time any Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose [If Other Securities and Warrants are not immediately detachable—or upon the registration of the Other Securities prior to the Detachable Date. Prior to the Detachable Date, the Company will, or will cause the registrar of the Other Securities to, make available at all times to the Warrant Agent such information as to holders of the Other Securities as may be necessary to keep the Warrant Agent's records up to date].

        1.3    Issuance of Warrant Certificates.     Warrant Certificates evidencing the right to purchase Warrant Securities may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign such Warrant Certificates and shall deliver such Warrant Certificates to or upon the order of the Company.


ARTICLE 2

WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS

        2.1    Warrant Price.     During the period specified in Section 2.2, each Warrant shall, subject to the terms of this Warrant Agreement and the applicable Warrant Certificate, entitle the holder thereof to initially purchase the number of Warrant Securities specified in the applicable Warrant Certificate at an initial exercise price of $                              per Warrant Security, subject to adjustment upon the occurrence of certain events, as hereinafter provided. Such purchase price per Warrant Security is referred to in this Agreement as the "Warrant Price."

        2.2    Duration of Warrants.     Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [            ] and at or before [            ] p.m., [City] time, on            or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the "Expiration Date"). Each Warrant not exercised at or before [            ] p.m., [City] time, on the Expiration Date shall become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement shall cease.

        2.3    Exercise of Warrants.     

        (a)   During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful money of the United States of

2

America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate as aforesaid, be deemed to be the date on which the Warrant is exercised; provided, however, that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be closed, no such receipt of such Warrant Certificates and no such payment of such Warrant Price shall be effective to constitute the person so designated to be named as the holder of record of such Warrant Securities on such date, but shall be effective to constitute such person as the holder of record of such Warrant Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be opened, and the certificates for the Warrant Securities in respect of which such Warrants are then exercised shall be issuable as of the date on such next succeeding day on which the transfer books shall next be opened, and until such date the Company shall be under no duty to deliver any certificate for such Warrant Securities. The Warrant Agent shall deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and shall advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such telephone advice to the Company in writing.

        (b)   The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing such Warrants with respect to delivery of the Warrant Securities to which such holder is entitled upon such exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Securities after such exercise, and (iv) such other information as the Company shall reasonably require.

        (c)   As soon as practicable after the exercise of any Warrant, the Company shall issue to or upon the order of the holder of the Warrant Certificate evidencing such Warrant the Warrant Securities to which such holder is entitled, in fully registered form, registered in such name or names as may be directed by such holder. If fewer than all of the Warrants evidenced by such Warrant Certificate are exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

        (d)   The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Security until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due.

        (e)   Prior to the issuance of any Warrants there shall have been reserved, and the Company shall at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Securities, a number of shares sufficient to provide for the exercise of the Warrants.

3



ARTICLE 3

OTHER PROVISIONS RELATING TO RIGHTS
OF HOLDERS OF WARRANT CERTIFICATES

        3.1    No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.     No Warrant Certificate or Warrant evidenced thereby shall entitle the holder thereof to any of the rights of a holder of Warrant Securities, including, without limitation, the right to receive the payment of dividends or distributions, if any, on the Warrant Securities or to exercise any voting rights, except to the extent expressly set forth in this Agreement or the applicable Warrant Certificate.

        3.2    Lost, Stolen, Mutilated or Destroyed Warrant Certificates.     Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate and/or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like number of Warrant Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.

        3.3    Holder of Warrant Certificate May Enforce Rights.     Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the holder of any Warrant Securities or the holder of any other Warrant Certificate, may, in such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, such holder's right to exercise the Warrants evidenced by such holder's Warrant Certificate in the manner provided in such holder's Warrant Certificate and in this Agreement.

        3.4    Adjustments.     

        (a)   In case the Company shall at any time subdivide its outstanding shares of Common Stock into a greater number of shares, the Warrant Price in effect immediately prior to such subdivision shall be proportionately reduced and the number of Warrant Securities purchasable under the Warrants shall be proportionately increased. Conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Warrant Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Securities purchasable under the Warrants shall be proportionately decreased.

        (b)   If at any time or from time to time the holders of Common Stock (or any shares of stock or other securities at the time receivable upon the exercise of the Warrants) shall have received or become entitled to receive, without payment therefore,

4


then and in each such case, the holder of each Warrant shall, upon the exercise of the Warrant, be entitled to receive, in addition to the number of Warrant Securities receivable thereupon, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash and indebtedness (or rights to subscribe for or purchase indebtedness) which such holder would hold on the date of such exercise had he been the holder of record of such Warrant Securities as of the date on which holders of Common Stock received or became entitled to receive such shares or all other additional stock and other securities and property.

        (c)   In case of (i) any reclassification, capital reorganization, or change in the Common Stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 3.4(a) or Section 3.4(b) above), (ii) share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation and which does not result in any change in the Common Stock other than the issuance of additional shares of Common Stock) or (iii) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a "Reorganization Event"), then, as a condition of such Reorganization Event, lawful provisions shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holders of the Warrants, so that the holders of the Warrants shall have the right at any time prior to the expiration of the Warrants to purchase, at a total price equal to that payable upon the exercise of the Warrants, the kind and amount of shares of stock and other securities and property receivable in connection with such Reorganization Event by a holder of the same number of Warrant Securities as were purchasable by the holders of the Warrants immediately prior to such Reorganization Event. In any such case appropriate provisions shall be made with respect to the rights and interests of the holders of the Warrants so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise the Warrants, and appropriate adjustments shall be made to the Warrant Price payable hereunder provided the aggregate purchase price shall remain the same. In the case of any transaction described in clauses (ii) and (iii) above, the Company shall thereupon be relieved of any further obligation hereunder or under the Warrants, and the Company as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming entity thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable hereunder which heretofore shall not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution hereof. In any

5


case of any such Reorganization Event, such changes in phraseology and form (but not in substance) may be made in the Warrants thereafter to be issued as may be appropriate.

        The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that any such Reorganization Event complies with the provisions of this Section 3.4.

        (d)   The Company may, at its option, at any time until the Expiration Date, reduce the then current Warrant Price to any amount deemed appropriate by the Board of Directors of the Company for any period not exceeding twenty consecutive days (as evidenced in a resolution adopted by such Board of Directors), but only upon giving the notices required by Section 3.5 at least ten days prior to taking such action.

        (e)   Except as herein otherwise expressly provided, no adjustment in the Warrant Price shall be made by reason of the issuance of shares of Common Stock, or securities convertible into or exchangeable for shares of Common Stock, or securities carrying the right to purchase any of the foregoing or for any other reason whatsoever.

        (f)    No fractional Warrant Securities shall be issued upon the exercise of Warrants. If more than one Warrant shall be exercised at one time by the same holder, the number of full Warrant Securities which shall be issuable upon such exercise shall be computed on the basis of the aggregate number of Warrant Securities purchased pursuant to the Warrants so exercised. Instead of any fractional Warrant Security which would otherwise be issuable upon exercise of any Warrant, the Company shall pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the last sales price (or bid price if there were no sales) per Warrant Security, in either case as reported on the New York Stock Exchange Composite Tape on the business day which next precedes the day of exercise or, if the Warrant Securities are not then listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the Warrant Securities are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of the National Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ"), or if the Warrant Securities are not then listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the Warrant Securities are not quoted by any such organization, an amount equal to the same fraction of the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose at the close of business on the business day which next precedes the day of exercise.

        (g)   Whenever the Warrant Price then in effect is adjusted as herein provided, the Company shall mail to each holder of the Warrants at such holder's address as it shall appear on the books of the Company a statement setting forth the adjusted Warrant Price then and thereafter effective under the provisions hereof, together with the facts, in reasonable detail, upon which such adjustment is based.

        3.5    Notice to Warrantholders.     In case the Company shall (a) effect any dividend or distribution described in Section 3.4(b), (b) effect any Reorganization Event, (c) make any distribution on or in respect of the Common Stock in connection with the dissolution, liquidation or winding up of the Company, or (d) reduce the then current Warrant Price pursuant to Section 3.4(d), then the Company shall mail to each holder of Warrants at such holder's address as it shall appear on the books of the Warrant Agent, at least ten days prior to the applicable date hereinafter specified, a notice stating (x) the record date for such dividend or distribution, or, if a record is not to be taken, the date as of which the holders of record of Common Stock that will be entitled to such dividend or distribution are to be determined, (y) the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up, or (z) the

6

first date on which the then current Warrant Price shall be reduced pursuant to Section 3.4(d). No failure to mail such notice nor any defect therein or in the mailing thereof shall affect any such transaction or any adjustment in the Warrant Price required by Section 3.4.

        3.6    [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.     

        (a)   At any time on or after            , the Company shall have the right to accelerate any or all Warrants at any time by causing them to expire at the close of business on the day next preceding a specified date (the "Acceleration Date"), if the Market Price (as hereinafter defined) of the Common Stock equals or exceeds            percent (    %) of the then effective Warrant Price on any twenty Trading Days (as hereinafter defined) within a period of thirty consecutive Trading Days ending no more than five Trading Days prior to the date on which the Company gives notice to the Warrant Agent of its election to accelerate the Warrants.

        (b)   "Market Price" for each Trading Day shall be, if the Common Stock is listed or admitted for trading on the New York Stock Exchange, the last reported sale price, regular way (or, if no such price is reported, the average of the reported closing bid and asked prices, regular way) of Common Stock, in either case as reported on the New York Stock Exchange Composite Tape or, if the Common Stock is not listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the Common Stock is listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of NASDAQ or, if not listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the shares of Common Stock are not quoted by any such organization, the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose. "Trading Day" shall be each Monday through Friday, other than any day on which securities are not traded in the system or on the exchange that is the principal market for the Common Stock, as determined by the Board of Directors of the Company.

        (c)   In the event of an acceleration of less than all of the Warrants, the Warrant Agent shall select the Warrants to be accelerated by lot, pro rata or in such other manner as it deems, in its discretion, to be fair and appropriate.

        (d)   Notice of an acceleration specifying the Acceleration Date shall be sent by mail first class, postage prepaid, to each registered holder of a Warrant Certificate representing a Warrant accelerated at such holder's address appearing on the books of the Warrant Agent not more than sixty days nor less than thirty days before the Acceleration Date. Such notice of an acceleration also shall be given no more than twenty days, and no less than ten days, prior to the mailing of notice to registered holders of Warrants pursuant to this Section 3.6, by publication at least once in a newspaper of general circulation in the City of New York.

        (e)   Any Warrant accelerated may be exercised until [    ] p.m., [City] time, on the business day next preceding the Acceleration Date. The Warrant Price shall be payable as provided in Section 2.]


ARTICLE 4

EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES

        4.1    Exchange and Transfer of Warrant Certificates.     [If Other Securities with Warrants which are immediately detachable—Upon] [If Other Securities with Warrants which are not immediately detachable—Prior to the Detachable Date, a Warrant Certificate may be exchanged or transferred only together with the Other Security to which the Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with an exchange or transfer of such Other Security. Prior to

7

any Detachable Date, each transfer of the Other Security shall operate also to transfer the related Warrant Certificates. After the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided that such other Warrant Certificates evidence Warrants for the same aggregate number of Warrant Securities as the Warrant Certificates so surrendered. The Warrant Agent shall keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, upon surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. No service charge shall be made for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. Whenever any Warrant Certificates are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent shall not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Security or a number of Warrants for a whole number of Warrant Securities and a fraction of a Warrant Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.

        4.2    Treatment of Holders of Warrant Certificates.     [If Other Securities and Warrants are not immediately detachable—Prior to the Detachable Date, the Company, the Warrant Agent and all other persons may treat the owner of the Other Security as the owner of the Warrant Certificates initially attached thereto for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced by such Warrant Certificates, any notice to the contrary notwithstanding. After the Detachable Date and prior to due presentment of a Warrant Certificate for registration of transfer, the] [T]he Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.

        4.3    Cancellation of Warrant Certificates.     Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in exchange therefor or in lieu thereof. The Warrant Agent shall deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.


ARTICLE 5

CONCERNING THE WARRANT AGENT

        5.1    Warrant Agent.     The Company hereby appoints            as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and            hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and hereby and such further powers and authority to act on behalf of the Company as the Company may hereafter grant to

8

or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof.

        5.2    Conditions of Warrant Agent's Obligations.     The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following to all of which the Company agrees and to all of which the rights hereunder of the holders from time to time of the Warrant Certificates shall be subject:

9

        5.3    Resignation and Appointment of Successor.     

        (a)   The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable.

        (b)   The Warrant Agent may at any time resign as agent by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided that such date shall not be less than three months after the date on which such notice is given unless the Company otherwise agrees. The Warrant Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company and specifying such removal and the intended date when it shall become effective. Such resignation or removal shall take effect upon the appointment by the Company, as hereinafter provided, of a successor Warrant Agent (which shall be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of such appointment by such successor Warrant Agent. The obligation of the Company under Section 5.2(a) shall continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.

        (c)   In case at any time the Warrant Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action, or a decree or order for relief by a court having jurisdiction in the premises shall have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer shall take charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder.

        (d)   Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and

10


thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor, as Warrant Agent hereunder.

        (e)   Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.


ARTICLE 6

MISCELLANEOUS

        6.1    Amendment.     This Agreement may be amended by the parties hereto, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action shall not materially adversely affect the interests of the holders of the Warrant Certificates.

        6.2    Notices and Demands to the Company and Warrant Agent.     If the Warrant Agent shall receive any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company.

        6.3    Addresses.     Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to            , Attention:            and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to Primus Telecommunications Group, Incorporated, 1700 Old Meadow Road, McLean, Virginia 22102, Attention: General Counsel (or such other address as shall be specified in writing by the Warrant Agent or by the Company).

        6.4    Governing Law.     This Agreement and each Warrant Certificate issued hereunder shall be governed by and construed in accordance with the laws of the State of New York.

        6.5    Delivery of Prospectus.     The Company shall furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Securities deliverable upon exercise of the Warrants (the "Prospectus"), and the Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued upon such exercise, a Prospectus.

The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.

        6.6    Obtaining of Governmental Approvals.     The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state

11

laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.

        6.7    Persons Having Rights Under Warrant Agreement.     Nothing in this Agreement shall give to any person other than the Company, the Warrant Agent and the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.

        6.8    Headings.     The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

        6.9    Counterparts.     This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument.

        6.10    Inspection of Agreement.     A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit his Warrant Certificate for inspection by it.

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        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.

    PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
By
 
     
    Its  
     
Attest:      


 
 
 

 
 
 
 
   
Warrant Agent

 
 
By
 
     
    Its  
     
Attest:      


 
 
 


[SIGNATURE PAGE TO COMMON STOCK WARRANT AGREEMENT]


EXHIBIT A

FORM OF WARRANT CERTIFICATE
[Face of Warrant Certificate]

[Form if Warrants are attached to Other Securities and are not immediately detachable.   Prior to            , this Warrant Certificate cannot be transferred or exchanged unless attached to a [Title of Other Securities].]

[Form of Legend if Warrants are not immediately exercisable.
 
Prior to            , Warrants evidenced by this Warrant Certificate cannot be exercised.]

EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN

VOID AFTER [    ] P.M., [CITY] TIME, ON                  ,

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
COMMON STOCK, PAR VALUE $0.01 PER SHARE

No.   Warrants

        This certifies that                        or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner [if Warrants are attached to Other Securities and are not immediately detachable—, subject to the registered owner qualifying as a "Holder" of this Warrant Certificate, as hereinafter defined),] to purchase, at any time [after [            ] p.m., [City] time, on            and] on or before [    ] p.m., [City] time, on            ,            shares of Common Stock, par value $0.01 per share (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated (the "Company") on the following basis: during the period from            , through and including            , the exercise price per Warrant Security will be $                              , subject to adjustment as provided in the Warrant Agreement (as hereinafter defined) (the "Warrant Price"). The Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Security with respect to which this Warrant is exercised to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the purchase form on the back hereof duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the "Warrant Agent"), which is, on the date hereof, at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined).

        The term "Holder" as used herein shall mean [if Warrants are attached to Other Securities and are not immediately detachable—prior to            ,    (the "Detachable Date"), the registered owner of the Company's [title of Other Securities]to which this Warrant Certificate was initially attached, and after such Detachable Date,] the person in whose name at the time this Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose pursuant to Section 4 of the Warrant Agreement.

        The Warrants evidenced by this Warrant Certificate may be exercised to purchase a whole number of Warrant Securities in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Holder hereof a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

A-1


        This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of            ,    (the "Warrant Agreement"), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Holder of this Warrant Certificate consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.

        [If Warrants are attached to Other Securities and are not immediately detachable—Prior to the Detachable Date, this Warrant Certificate may be exchanged or transferred only together with the [Title of Other Securities] (the "Other Securities") to which this Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with, an exchange or transfer of such Other Security. Additionally, on or prior to the Detachable Date, each transfer of such Other Security on the register of the Other Securities shall operate also to transfer this Warrant Certificate. After such date, transfer of this] [If Warrants are attached to Other Securities and are immediately detachable—Transfer of this] Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner's assigns, in the manner and subject to the limitations provided in the Warrant Agreement.

        [If Other Securities with Warrants which are not immediately detachable—Except as provided in the immediately preceding paragraph, after] [If Other Securities with Warrants which are immediately detachable or Warrants alone—After] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate number of Warrant Securities.

        This Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of dividends or distributions, if any, on the Warrant Securities (except to the extent set forth in the Warrant Agreement) or to exercise any voting rights.

        Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

        This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent.

        IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.

Dated:   PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
 
By
 
       
      Its  
       
Attest:      

 
 
 
 
 
     

 
 
 
 
 
Countersigned:      

 
 
 
 
 
As Warrant Agent		      

By
 
 
 
 
 
Authorized Signature
 		     

A-2

[REVERSE OF WARRANT CERTIFICATE]

(Instructions for Exercise of Warrant)

To exercise any Warrants evidenced hereby for Warrant Securities (as hereinafter defined), the Holder must pay, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent] [address of Warrant Agent], Attn:            , which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.

(To be executed upon exercise of Warrants)

        The undersigned hereby irrevocably elects to exercise            Warrants, evidenced by this Warrant Certificate, to purchase            shares of the Common Stock, par value $0.01 per share (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated and represents that he has tendered payment for such Warrant Securities, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Primus Telecommunications Group, Incorporated, c/o [insert name and address of Warrant Agent], in the amount of $                              in accordance with the terms hereof. The undersigned requests that said Warrant Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.

        If the number of Warrants exercised is less than all of the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the number of Warrant Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.


 
 
 
 

Dated
 
Name
 
     
(Please Print)

 
 
Address
 
     

 
 

A-3


 
 

 
(Insert Social Security or Other Identifying Number of Holder)

Signature Guaranteed
Signature

 
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange)

This Warrant may be exercised at the following addresses:

By hand at
 
 
   

 
 

 
 

By mail at
 
 
   

 
 

 
 

[Instructions as to form and delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Securities remaining unexercised—complete as appropriate.]

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ASSIGNMENT

[Form of assignment to be executed if
Warrant Holder desires to transfer Warrant)

        FOR VALUE RECEIVED,                        hereby sells, assigns and transfers unto:


 
 
 


 
 


 
 

(Please print name and address including zip code)
 
Please insert Social Security or other identifying number

 
 
 

the right represented by the within Warrant to purchase            shares of [Title of Warrant Securities] of Primus Telecommunications Group, Incorporated to which the within Warrant relates and appoints            attorney to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.

 
 
 

Dated
 
Signature

 
 
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)

Signature Guaranteed
 
 

 
 
 


 
 

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TABLE OF CONTENTS
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED Form of Common Stock Warrant Agreement
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants.
1.2 Execution and Delivery of Warrant Certificates.
1.3 Issuance of Warrant Certificates.
ARTICLE 2 WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price.
2.2 Duration of Warrants.
2.3 Exercise of Warrants.
ARTICLE 3 OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
3.1 No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights.
3.4 Adjustments.
3.5 Notice to Warrantholders.
3.6 [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.
ARTICLE 4 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates.
4.2 Treatment of Holders of Warrant Certificates.
4.3 Cancellation of Warrant Certificates.
ARTICLE 5 CONCERNING THE WARRANT AGENT
5.1 Warrant Agent.
5.2 Conditions of Warrant Agent's Obligations.
5.3 Resignation and Appointment of Successor.
ARTICLE 6 MISCELLANEOUS
6.1 Amendment.
6.2 Notices and Demands to the Company and Warrant Agent.
6.3 Addresses.
6.4 Governing Law.
6.5 Delivery of Prospectus.
6.6 Obtaining of Governmental Approvals.
6.7 Persons Having Rights Under Warrant Agreement.
6.8 Headings.
6.9 Counterparts.
6.10 Inspection of Agreement.
EXHIBIT A FORM OF WARRANT CERTIFICATE [Face of Warrant Certificate]

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Exhibit 4.8

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

and

                                    , As Warrant Agent

FORM OF PREFERRED STOCK
WARRANT AGREEMENT

Dated As Of                        


TABLE OF CONTENTS

 
    
   PAGE
ARTICLE 1   ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES   1
  1.1   Issuance of Warrants   1
  1.2   Execution and Delivery of Warrant Certificates   1
  1.3   Issuance of Warrant Certificates   2

ARTICLE 2
 
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
 
2
  2.1   Warrant Price   2
  2.2   Duration of Warrants   2
  2.3   Exercise of Warrants   2

ARTICLE 3
 
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
 
3
  3.1   No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates   3
  3.2   Lost, Stolen, Mutilated or Destroyed Warrant Certificates   4
  3.3   Holder of Warrant Certificate May Enforce Rights   4
  3.4   Adjustments   4
  3.5   Notice to Warrantholders   6
  3.6   [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company   7

ARTICLE 4
 
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
 
8
  4.1   Exchange and Transfer of Warrant Certificates   8
  4.2   Treatment of Holders of Warrant Certificates   8
  4.3   Cancellation of Warrant Certificates   8

ARTICLE 5
 
CONCERNING THE WARRANT AGENT
 
9
  5.1   Warrant Agent   9
  5.2   Conditions of Warrant Agent's Obligations   9
  5.3   Resignation and Appointment of Successor   10

ARTICLE 6
 
MISCELLANEOUS
 
11
  6.1   Amendment   11
  6.2   Notices and Demands to the Company and Warrant Agent   11
  6.3   Addresses   11
  6.4   Governing Law   11
  6.5   Delivery of Prospectus   11
  6.6   Obtaining of Governmental Approvals   12
  6.7   Persons Having Rights Under Warrant Agreement   12
  6.8   Headings   12
  6.9   Counterparts   12
  6.10   Inspection of Agreement   12

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PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
Form of Preferred Stock Warrant Agreement

        PREFERRED STOCK WARRANT AGREEMENT, dated as of            between PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a Delaware corporation (the "Company") and                        , a [corporation] [national banking association] organized and existing under the laws of            and having a corporate trust office in            , as warrant agent (the "Warrant Agent").

        WHEREAS, the Company proposes to sell [if Warrants are sold with other securities—[title of such other securities being offered] (the "Other Securities") with] warrant certificates evidencing one or more warrants (the "Warrants" or, individually, a "Warrant") representing the right to purchase [title of Preferred Stock purchasable through exercise of Warrants] (the "Warrant Securities"), such warrant certificates and other warrant certificates issued pursuant to this Agreement being herein called the "Warrant Certificates"; and

        WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to set forth, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced;

        NOW THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows:


ARTICLE 1

ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES

        1.1    Issuance of Warrants.     [If Warrants alone—Upon issuance, each Warrant Certificate shall evidence one or more Warrants.] [If Other Securities and Warrants—Warrants shall be [initially] issued in connection with the issuance of the Other Securities [but shall be separately transferable on and after                        (the "Detachable Date")] [and shall not be separately transferable] and each Warrant Certificate shall evidence one or more Warrants.] Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase one Warrant Security. [If Other Securities and Warrants—Warrant Certificates shall be initially issued in units with the Other Securities and each Warrant Certificate included in such a unit shall evidence            Warrants for each [$            principal amount] [            shares] of Other Securities included in such unit.]

        1.2    Execution and Delivery of Warrant Certificates.     Each Warrant Certificate, whenever issued, shall be in registered form substantially in the form set forth in Exhibit A hereto, shall be dated the date of its countersignature by the Warrant Agent and may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced thereon. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.

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        No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence that the Warrant Certificate so countersigned has been duly issued hereunder.

        In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.

        The term "holder" or "holder of a Warrant Certificate" as used herein shall mean any person in whose name at the time any Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose [If Other Securities and Warrants are not immediately detachable—or upon the registration of the Other Securities prior to the Detachable Date. Prior to the Detachable Date, the Company will, or will cause the registrar of the Other Securities to, make available at all times to the Warrant Agent such information as to holders of the Other Securities as may be necessary to keep the Warrant Agent's records up to date].

        1.3    Issuance of Warrant Certificates.     Warrant Certificates evidencing the right to purchase Warrant Securities may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign such Warrant Certificates and shall deliver such Warrant Certificates to or upon the order of the Company.


ARTICLE 2

WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS

        2.1    Warrant Price.     During the period specified in Section 2.2, each Warrant shall, subject to the terms of this Warrant Agreement and the applicable Warrant Certificate, entitle the holder thereof to purchase the number of Warrant Securities specified in the applicable Warrant Certificate at an exercise price of $                      per Warrant Security, subject to adjustment upon the occurrence of certain events, as hereinafter provided. Such purchase price per Warrant Security is referred to in this Agreement as the "Warrant Price."

        2.2    Duration of Warrants.     Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [            ] and at or before [            ] p.m., [City] time, on            or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the "Expiration Date"). Each Warrant not exercised at or before [            ] p.m., [City] time, on the Expiration Date shall become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement shall cease.

        2.3    Exercise of Warrants.     

        (a)   During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Security with

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respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate as aforesaid, be deemed to be the date on which the Warrant is exercised; provided, however, that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be closed, no such receipt of such Warrant Certificates and no such payment of such Warrant Price shall be effective to constitute the person so designated to be named as the holder of record of such Warrant Securities on such date, but shall be effective to constitute such person as the holder of record of such Warrant Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be opened, and the certificates for the Warrant Securities in respect of which such Warrants are then exercised shall be issuable as of the date on such next succeeding day on which the transfer books shall next be opened, and until such date the Company shall be under no duty to deliver any certificate for such Warrant Securities. The Warrant Agent shall deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and shall advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such telephone advice to the Company in writing.

        (b)   The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing such Warrants with respect to delivery of the Warrant Securities to which such holder is entitled upon such exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Securities after such exercise, and (iv) such other information as the Company shall reasonably require.

        (c)   As soon as practicable after the exercise of any Warrant, the Company shall issue to or upon the order of the holder of the Warrant Certificate evidencing such Warrant the Warrant Securities to which such holder is entitled, in fully registered form, registered in such name or names as may be directed by such holder. If fewer than all of the Warrants evidenced by such Warrant Certificate are exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

        (d)   The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Security until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due.

        (e)   Prior to the issuance of any Warrants there shall have been reserved, and the Company shall at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Securities, a number of shares sufficient to provide for the exercise of the Warrants.


ARTICLE 3

OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES

        3.1    No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.     No Warrant Certificate or Warrant evidenced thereby shall entitle the holder thereof to any of the rights of a holder of Warrant Securities, including, without limitation, the right to receive the payment of

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dividends or distributions, if any, on the Warrant Securities or to exercise any voting rights, except to the extent expressly set forth in this Agreement or the applicable Warrant Certificate.

        3.2    Lost, Stolen, Mutilated or Destroyed Warrant Certificates.     Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate and/or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like number of Warrant Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.

        3.3    Holder of Warrant Certificate May Enforce Rights.     Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the holder of any Warrant Securities or the holder of any other Warrant Certificate, may, in such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, such holder's right to exercise the Warrants evidenced by such holder's Warrant Certificate in the manner provided in such holder's Warrant Certificate and in this Agreement.

        3.4    Adjustments.     

        (a)   In case the Company shall at any time subdivide its outstanding shares of [title of Preferred Stock purchasable through exercise of Warrants] into a greater number of shares, the Warrant Price in effect immediately prior to such subdivision shall be proportionately reduced and the number of Warrant Securities purchasable under the Warrants shall be proportionately increased. Conversely, in case the outstanding shares of [title of Preferred Stock purchasable through exercise of Warrants] of the Company shall be combined into a smaller number of shares, the Warrant Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Securities purchasable under the Warrants shall be proportionately decreased.

        (b)   If at any time or from time to time the holders of [title of Preferred Stock purchasable through exercise of Warrants] (or any shares of stock or other securities at the time receivable upon the exercise of the Warrants) shall have received or become entitled to receive, without payment therefore,

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then and in each such case, the holder of each Warrant shall, upon the exercise of the Warrant, be entitled to receive, in addition to the number of Warrant Securities receivable thereupon, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash and indebtedness (or rights to subscribe for or purchase indebtedness) which such holder would hold on the date of such exercise had he been the holder of record of such Warrant Securities as of the date on which holders of [title of Preferred Stock purchasable through exercise of Warrants] received or became entitled to receive such shares or all other additional stock and other securities and property.

        (c)   In case of (i) any reclassification, capital reorganization, or change in the [title of Preferred Stock purchasable through the exercise of the Warrants] of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 3.4(a) or Section 3.4(b) above), (ii) share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation and which does not result in any change in the [title of Preferred Stock purchasable through the exercise of the Warrants] other than the issuance of additional shares of [title of Preferred Stock purchasable through the exercise of the Warrants]) or (iii) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a "Reorganization Event"), then, as a condition of such Reorganization Event, lawful provisions shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holders of the Warrants, so that the holders of the Warrants shall have the right at any time prior to the expiration of the Warrants to purchase, at a total price equal to that payable upon the exercise of the Warrants, the kind and amount of shares of stock and other securities and property receivable in connection with such Reorganization Event by a holder of the same number of shares of [title of Preferred Stock purchasable through the exercise of the Warrants] as were purchasable by the holders of the Warrants immediately prior to such Reorganization Event. In any such case appropriate provisions shall be made with respect to the rights and interests of the holders of the Warrants so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise the Warrants, and appropriate adjustments shall be made to the Warrant Price payable hereunder provided the aggregate purchase price shall remain the same. In the case of any transaction described in clauses (ii) and (iii) above, the Company shall thereupon be relieved of any further obligation hereunder or under the Warrants, and the Company as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming entity thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable hereunder which heretofore shall not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the terms of this Agreement as though all of such Warrants had been issued at the

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date of the execution hereof. In any case of any such Reorganization Event, such changes in phraseology and form (but not in substance) may be made in the Warrants thereafter to be issued as may be appropriate.

        The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that any such Reorganization Event complies with the provisions of this Section 3.4.

        (d)   The Company may, at its option, at any time until the Expiration Date, reduce the then current Warrant Price to any amount deemed appropriate by the Board of Directors of the Company for any period not exceeding twenty consecutive days (as evidenced in a resolution adopted by such Board of Directors), but only upon giving the notices required by Section 3.5 at least ten days prior to taking such action.

        (e)   Except as herein otherwise expressly provided, no adjustment in the Warrant Price shall be made by reason of the issuance of any securities of the Company or for any other reason whatsoever.

        (f)    No fractional Warrant Securities shall be issued upon the exercise of Warrants. If more than one Warrant shall be exercised at one time by the same holder, the number of full Warrant Securities which shall be issuable upon such exercise shall be computed on the basis of the aggregate number of Warrant Securities purchased pursuant to the Warrants so exercised. Instead of any fractional Warrant Security which would otherwise be issuable upon exercise of any Warrant, the Company shall pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the last sales price (or bid price if there were no sales) per Warrant Security, in either case as reported on the New York Stock Exchange Composite Tape on the business day which next precedes the day of exercise or, if the Warrant Securities are not then listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the Warrant Securities are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of the National Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ"), or if the Warrant Securities are not then listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the Warrant Securities are not quoted by any such organization, an amount equal to the same fraction of the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose at the close of business on the business day which next precedes the day of exercise.

        (g)   Whenever the Warrant Price then in effect is adjusted as herein provided, the Company shall mail to each holder of the Warrants at such holder's address as it shall appear on the books of the Company a statement setting forth the adjusted Warrant Price then and thereafter effective under the provisions hereof, together with the facts, in reasonable detail, upon which such adjustment is based.

        3.5    Notice to Warrantholders.     In case the Company shall (a) effect any dividend or distribution described in Section 3.4(b), (b) effect any Reorganization Event, (c) make any distribution on or in respect of the [title of Preferred Stock purchasable through the exercise of the Warrants] in connection with the dissolution, liquidation or winding up of the Company, or (d) reduce the then current Warrant Price pursuant to Section 3.4(d), then the Company shall mail to each holder of Warrants at such holder's address as it shall appear on the books of the Warrant Agent, at least ten days prior to the applicable date hereinafter specified, a notice stating (x) the record date for such dividend or distribution, or, if a record is not to be taken, the date as of which the holders of record of [title of Preferred Stock purchasable through the exercise of Warrants] that will be entitled to such dividend or distribution are to be determined, (y) the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of [title of Preferred Stock purchasable through the exercise of the Warrants] of record shall be entitled to exchange their shares of [title of Preferred Stock purchasable through the exercise of the

6

Warrants] for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up, or (z) the first date on which the then current Warrant Price shall be reduced pursuant to Section 3.4(d). No failure to mail such notice nor any defect therein or in the mailing thereof shall affect any such transaction or any adjustment in the Warrant Price required by Section 3.4.

        3.6    [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.     

        (a)   At any time on or after            , the Company shall have the right to accelerate any or all Warrants at any time by causing them to expire at the close of business on the day next preceding a specified date (the "Acceleration Date"), if the Market Price (as hereinafter defined) of the [title of Preferred Stock purchasable through the exercise of the Warrants] equals or exceeds            percent (    %) of the then effective Warrant Price on any twenty Trading Days (as hereinafter defined) within a period of thirty consecutive Trading Days ending no more than five Trading Days prior to the date on which the Company gives notice to the Warrant Agent of its election to accelerate the Warrants.

        (b)   "Market Price" for each Trading Day shall be, if the [title of Preferred Stock purchasable through the exercise of the Warrants] is listed or admitted for trading on the New York Stock Exchange, the last reported sale price, regular way (or, if no such price is reported, the average of the reported closing bid and asked prices, regular way) of [title of Preferred Stock purchasable through the exercise of the Warrants], in either case as reported on the New York Stock Exchange Composite Tape or, if the [title of Preferred Stock purchasable through the exercise of the Warrants] is not listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the [title of Preferred Stock purchasable through the exercise of the Warrants] is listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of NASDAQ or, if not listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the shares of [title of Preferred Stock purchasable through the exercise of the Warrants] are not quoted by any such organization, the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose. "Trading Day" shall be each Monday through Friday, other than any day on which securities are not traded in the system or on the exchange that is the principal market for the [title of Preferred Stock purchasable through the exercise of the Warrants], as determined by the Board of Directors of the Company.

        (c)   In the event of an acceleration of less than all of the Warrants, the Warrant Agent shall select the Warrants to be accelerated by lot, pro rata or in such other manner as it deems, in its discretion, to be fair and appropriate.

        (d)   Notice of an acceleration specifying the Acceleration Date shall be sent by mail first class, postage prepaid, to each registered holder of a Warrant Certificate representing a Warrant accelerated at such holder's address appearing on the books of the Warrant Agent not more than sixty days nor less than thirty days before the Acceleration Date. Such notice of an acceleration also shall be given no more than twenty days, and no less than ten days, prior to the mailing of notice to registered holders of Warrants pursuant to this Section 3.6, by publication at least once in a newspaper of general circulation in the City of New York.

        (e)   Any Warrant accelerated may be exercised until [    ] p.m., [City] time, on the business day next preceding the Acceleration Date. The Warrant Price shall be payable as provided in Section 2.]

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ARTICLE 4

EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES

        4.1    Exchange and Transfer of Warrant Certificates.     [If Other Securities with Warrants which are immediately detachable—Upon] [If Other Securities with Warrants which are not immediately detachable—Prior to the Detachable Date, a Warrant Certificate may be exchanged or transferred only together with the Other Security to which the Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with an exchange or transfer of such Other Security. Prior to any Detachable Date, each transfer of the Other Security shall operate also to transfer the related Warrant Certificates. After the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided that such other Warrant Certificates evidence Warrants for the same aggregate number of Warrant Securities as the Warrant Certificates so surrendered. The Warrant Agent shall keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, upon surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. No service charge shall be made for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. Whenever any Warrant Certificates are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent shall not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Security or a number of Warrants for a whole number of Warrant Securities and a fraction of a Warrant Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.

        4.2    Treatment of Holders of Warrant Certificates.     [If Other Securities and Warrants are not immediately detachable—Prior to the Detachable Date, the Company, the Warrant Agent and all other persons may treat the owner of the Other Security as the owner of the Warrant Certificates initially attached thereto for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced by such Warrant Certificates, any notice to the contrary notwithstanding. After the Detachable Date and prior to due presentment of a Warrant Certificate for registration of transfer, the] [T]he Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.

        4.3    Cancellation of Warrant Certificates.     Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in exchange therefor or in lieu thereof. The Warrant Agent shall deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.

8


ARTICLE 5

CONCERNING THE WARRANT AGENT

        5.1    Warrant Agent.     The Company hereby appoints            as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and            hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and hereby and such further powers and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof.

        5.2    Conditions of Warrant Agent's Obligations.     The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following to all of which the Company agrees and to all of which the rights hereunder of the holders from time to time of the Warrant Certificates shall be subject:

9

        5.3    Resignation and Appointment of Successor.     

        (a)   The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable.

        (b)   The Warrant Agent may at any time resign as agent by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided that such date shall not be less than three months after the date on which such notice is given unless the Company otherwise agrees. The Warrant Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company and specifying such removal and the intended date when it shall become effective. Such resignation or removal shall take effect upon the appointment by the Company, as hereinafter provided, of a successor Warrant Agent (which shall be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of such appointment by such successor Warrant Agent. The obligation of the Company under Section 5.2(a) shall continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.

        (c)   In case at any time the Warrant Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action, or a decree or order for relief by a court having jurisdiction in the premises shall have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian,

10


liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer shall take charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder.

        (d)   Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor, as Warrant Agent hereunder.

        (e)   Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.


ARTICLE 6

MISCELLANEOUS

        6.1    Amendment.     This Agreement may be amended by the parties hereto, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action shall not materially adversely affect the interests of the holders of the Warrant Certificates.

        6.2    Notices and Demands to the Company and Warrant Agent.     If the Warrant Agent shall receive any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company.

        6.3    Addresses.     Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to            , Attention:            and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to Primus Telecommunications Group, Incorporated, 1700 Old Meadow Road, McLean, Virginia 22102, Attention: General Counsel (or such other address as shall be specified in writing by the Warrant Agent or by the Company).

        6.4    Governing Law.     This Agreement and each Warrant Certificate issued hereunder shall be governed by and construed in accordance with the laws of the State of New York.

        6.5    Delivery of Prospectus.     The Company shall furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Securities deliverable upon exercise of the Warrants (the "Prospectus"), and the Warrant Agent

11

agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued upon such exercise, a Prospectus.

The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.

        6.6    Obtaining of Governmental Approvals.     The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.

        6.7    Persons Having Rights Under Warrant Agreement.     Nothing in this Agreement shall give to any person other than the Company, the Warrant Agent and the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.

        6.8    Headings.     The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

        6.9    Counterparts.     This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument.

        6.10    Inspection of Agreement.     A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit his Warrant Certificate for inspection by it.

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        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.

    PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
By
 
    
    Its       

Attest:
 
 
 
 

    
 
 
 
 

 
 
    
Warrant Agent

 
 
By
 
    
    Its       

Attest:
 
 
 
 

    
 
 
 
 

[SIGNATURE PAGE TO PREFERRED STOCK WARRANT AGREEMENT]


EXHIBIT A

FORM OF WARRANT CERTIFICATE
[Face of Warrant Certificate]

[Form if Warrants are attached to Other Securities and are not immediately detachable.   Prior to            , this Warrant Certificate cannot be transferred or exchanged unless attached to a [Title of Other Securities].]

[Form of Legend if Warrants are not immediately exercisable.
 
Prior to            , Warrants evidenced by this Warrant Certificate cannot be exercised.]

EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN

VOID AFTER [    ] P.M., [CITY] TIME, ON                        ,

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT SECURITIES]

No.                           Warrants

        This certifies that                        or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner [if Warrants are attached to Other Securities and are not immediately detachable—, subject to the registered owner qualifying as a "Holder" of this Warrant Certificate, as hereinafter defined),] to purchase, at any time [after [            ] p.m., [City] time, on            and] on or before [    ] p.m., [City] time, on            ,            shares of [Title of Warrant Securities] (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated (the "Company") on the following basis: during the period from            , through and including            , the exercise price per Warrant Security will be $                              , subject to adjustment as provided in the Warrant Agreement (as hereinafter defined) (the "Warrant Price"). The Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Security with respect to which this Warrant is exercised to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the purchase form on the back hereof duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the "Warrant Agent"), which is, on the date hereof, at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined).

        The term "Holder" as used herein shall mean [if Warrants are attached to Other Securities and are not immediately detachable—prior to            ,    (the "Detachable Date"), the registered owner of the Company's [title of Other Securities]to which this Warrant Certificate was initially attached, and after such Detachable Date,] the person in whose name at the time this Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose pursuant to Section 4 of the Warrant Agreement.

        The Warrants evidenced by this Warrant Certificate may be exercised to purchase a whole number of Warrant Securities in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Holder hereof a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

A-1


        This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of            ,    (the "Warrant Agreement"), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Holder of this Warrant Certificate consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.

        [If Warrants are attached to Other Securities and are not immediately detachable—Prior to the Detachable Date, this Warrant Certificate may be exchanged or transferred only together with the [Title of Other Securities] (the "Other Securities") to which this Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with, an exchange or transfer of such Other Security. Additionally, on or prior to the Detachable Date, each transfer of such Other Security on the register of the Other Securities shall operate also to transfer this Warrant Certificate. After such date, transfer of this] [If Warrants are attached to Other Securities and are immediately detachable—Transfer of this] Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner's assigns, in the manner and subject to the limitations provided in the Warrant Agreement.

        [If Other Securities with Warrants which are not immediately detachable—Except as provided in the immediately preceding paragraph, after] [If Other Securities with Warrants which are immediately detachable or Warrants alone—After] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate number of Warrant Securities.

        This Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of dividends or distributions, if any, on the Warrant Securities (except to the extent set forth in the Warrant Agreement) or to exercise any voting rights.

        Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

        This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent.

A-2


        IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.

Dated:   PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
 
By
 
    
      Its       

Attest:
 
 
 
 

    
 
 
 
 

Countersigned:
 
 
 
 

    
As Warrant Agent
 
 
 
 

By
    
Authorized Signature
 
 
 
 

A-3

[REVERSE OF WARRANT CERTIFICATE]

(Instructions for Exercise of Warrant)

        To exercise any Warrants evidenced hereby for Warrant Securities (as hereinafter defined), the Holder must pay, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent] [address of Warrant Agent], Attn:            , which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.

(To be executed upon exercise of Warrants)

        The undersigned hereby irrevocably elects to exercise            Warrants, evidenced by this Warrant Certificate, to purchase            shares of the [Title of Warrant Securities] (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated and represents that he has tendered payment for such Warrant Securities, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Primus Telecommunications Group, Incorporated, c/o [insert name and address of Warrant Agent], in the amount of $                              in accordance with the terms hereof. The undersigned requests that said Warrant Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.

        If the number of Warrants exercised is less than all of the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the number of Warrant Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.


Dated
 
 
Name
    
(Please Print)

 
 
 
Address
    

 
 
 
    

A-4

          
(Insert Social Security or Other Identifying Number of Holder)

Signature Guaranteed
 
    
Signature

 
 
 
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange)

This Warrant may be exercised at the following addresses:

By hand at       
    
    

By mail at
 
    
    
    

[Instructions as to form and delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Securities remaining unexercised—complete as appropriate.]

A-5

ASSIGNMENT

[Form of assignment to be executed if
Warrant Holder desires to transfer Warrant)

        FOR VALUE RECEIVED,                        hereby sells, assigns and transfers unto:

    
    
    
(Please print name and address including zip code)		     
  
  
    
Please insert Social Security or other identifying number

the right represented by the within Warrant to purchase            shares of [Title of Warrant Securities] of Primus Telecommunications Group, Incorporated to which the within Warrant relates and appoints            attorney to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.

Dated         
Signature

 
 
 
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)

Signature Guaranteed
 
 

    
 
 

A-6



QuickLinks

TABLE OF CONTENTS
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED Form of Preferred Stock Warrant Agreement
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants.
1.2 Execution and Delivery of Warrant Certificates.
1.3 Issuance of Warrant Certificates.
ARTICLE 2 WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price.
2.2 Duration of Warrants.
2.3 Exercise of Warrants.
ARTICLE 3 OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
3.1 No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights.
3.4 Adjustments.
3.5 Notice to Warrantholders.
3.6 [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.
ARTICLE 4 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates.
4.2 Treatment of Holders of Warrant Certificates.
4.3 Cancellation of Warrant Certificates.
ARTICLE 5 CONCERNING THE WARRANT AGENT
5.1 Warrant Agent.
5.2 Conditions of Warrant Agent's Obligations.
5.3 Resignation and Appointment of Successor.
ARTICLE 6 MISCELLANEOUS
6.1 Amendment.
6.2 Notices and Demands to the Company and Warrant Agent.
6.3 Addresses.
6.4 Governing Law.
6.5 Delivery of Prospectus.
6.6 Obtaining of Governmental Approvals.
6.7 Persons Having Rights Under Warrant Agreement.
6.8 Headings.
6.9 Counterparts.
6.10 Inspection of Agreement.
EXHIBIT A FORM OF WARRANT CERTIFICATE [Face of Warrant Certificate]

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Exhibit 4.9

        PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

and

                        , As Warrant Agent

FORM OF DEPOSITARY SHARES
WARRANT AGREEMENT

Dated As Of                        


TABLE OF CONTENTS

 
    
   Page
ARTICLE 1   ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES   1
  1.1   Issuance of Warrants   1
  1.2   Execution and Delivery of Warrant Certificates   1
  1.3   Issuance of Warrant Certificates   2

ARTICLE 2
 
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
 
2
  2.1   Warrant Price   2
  2.2   Duration of Warrants   2
  2.3   Exercise of Warrants   2

ARTICLE 3
 
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
 
3
  3.1   No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates   3
  3.2   Lost, Stolen, Mutilated or Destroyed Warrant Certificates   4
  3.3   Holder of Warrant Certificate May Enforce Rights   4
  3.4   Adjustments   4
  3.5   Notice to Warrantholders   6
  3.6   [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company   7

ARTICLE 4
 
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
 
8
  4.1   Exchange and Transfer of Warrant Certificates   8
  4.2   Treatment of Holders of Warrant Certificates   8
  4.3   Cancellation of Warrant Certificates   8

ARTICLE 5
 
CONCERNING THE WARRANT AGENT
 
9
  5.1   Warrant Agent   9
  5.2   Conditions of Warrant Agent's Obligations   9
  5.3   Resignation and Appointment of Successor   10

ARTICLE 6
 
MISCELLANEOUS
 
11
  6.1   Amendment   11
  6.2   Notices and Demands to the Company and Warrant Agent   11
  6.3   Addresses   11
  6.4   Governing Law   11
  6.5   Delivery of Prospectus   12
  6.6   Obtaining of Governmental Approvals   12
  6.7   Persons Having Rights Under Warrant Agreement   12
  6.8   Headings   12
  6.9   Counterparts   12
  6.10   Inspection of Agreement   12

i


PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
Form of Depositary Shares Warrant Agreement

        DEPOSITARY SHARES WARRANT AGREEMENT, dated as of            between PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a Delaware corporation (the "Company") and                        , a [corporation] [national banking association] organized and existing under the laws of            and having a corporate trust office in            , as warrant agent (the "Warrant Agent").

        WHEREAS, the Company proposes to sell [if Warrants are sold with other securities—[title of such other securities being offered] (the "Other Securities") with] warrant certificates evidencing one or more warrants (the "Warrants" or, individually, a "Warrant") representing the right to purchase [title of Depositary Shares purchasable through exercise of Warrants] (the "Warrant Securities"), such warrant certificates and other warrant certificates issued pursuant to this Agreement being herein called the "Warrant Certificates"; and

        WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to set forth, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced;

        NOW THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows:


ARTICLE 1

ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES

        1.1    Issuance of Warrants.     [If Warrants alone—Upon issuance, each Warrant Certificate shall evidence one or more Warrants.] [If Other Securities and Warrants—Warrants shall be [initially] issued in connection with the issuance of the Other Securities [but shall be separately transferable on and after                        (the "Detachable Date")] [and shall not be separately transferable] and each Warrant Certificate shall evidence one or more Warrants.] Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase one Warrant Security. [If Other Securities and Warrants—Warrant Certificates shall be initially issued in units with the Other Securities and each Warrant Certificate included in such a unit shall evidence            Warrants for each [$            principal amount] [            shares] of Other Securities included in such unit.]

        1.2    Execution and Delivery of Warrant Certificates.     Each Warrant Certificate, whenever issued, shall be in registered form substantially in the form set forth in Exhibit A hereto, shall be dated the date of its countersignature by the Warrant Agent and may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced thereon. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.

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        No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence that the Warrant Certificate so countersigned has been duly issued hereunder.

        In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.

        The term "holder" or "holder of a Warrant Certificate" as used herein shall mean any person in whose name at the time any Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose [If Other Securities and Warrants are not immediately detachable—or upon the registration of the Other Securities prior to the Detachable Date. Prior to the Detachable Date, the Company will, or will cause the registrar of the Other Securities to, make available at all times to the Warrant Agent such information as to holders of the Other Securities as may be necessary to keep the Warrant Agent's records up to date].

        1.3    Issuance of Warrant Certificates.     Warrant Certificates evidencing the right to purchase Warrant Securities may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign such Warrant Certificates and shall deliver such Warrant Certificates to or upon the order of the Company.


ARTICLE 2

WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS

        2.1    Warrant Price.     During the period specified in Section 2.2, each Warrant shall, subject to the terms of this Warrant Agreement and the applicable Warrant Certificate, entitle the holder thereof to purchase the number of Warrant Securities specified in the applicable Warrant Certificate at an exercise price of $                      per Warrant Security, subject to adjustment upon the occurrence of certain events, as hereinafter provided. Such purchase price per Warrant Security is referred to in this Agreement as the "Warrant Price."

        2.2    Duration of Warrants.     Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [            ] and at or before [            ] p.m., [City] time, on            or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the "Expiration Date"). Each Warrant not exercised at or before [            ] p.m., [City] time, on the Expiration Date shall become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement shall cease.

        2.3    Exercise of Warrants.     

        (a)   During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office,

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provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate as aforesaid, be deemed to be the date on which the Warrant is exercised; provided, however, that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be closed, no such receipt of such Warrant Certificates and no such payment of such Warrant Price shall be effective to constitute the person so designated to be named as the holder of record of such Warrant Securities on such date, but shall be effective to constitute such person as the holder of record of such Warrant Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants shall be opened, and the certificates for the Warrant Securities in respect of which such Warrants are then exercised shall be issuable as of the date on such next succeeding day on which the transfer books shall next be opened, and until such date the Company shall be under no duty to deliver any certificate for such Warrant Securities. The Warrant Agent shall deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and shall advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such telephone advice to the Company in writing.

        (b)   The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing such Warrants with respect to delivery of the Warrant Securities to which such holder is entitled upon such exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Securities after such exercise, and (iv) such other information as the Company shall reasonably require.

        (c)   As soon as practicable after the exercise of any Warrant, the Company shall issue to or upon the order of the holder of the Warrant Certificate evidencing such Warrant the Warrant Securities to which such holder is entitled, in fully registered form, registered in such name or names as may be directed by such holder. If fewer than all of the Warrants evidenced by such Warrant Certificate are exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

        (d)   The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Security until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due.

        (e)   Prior to the issuance of any Warrants there shall have been reserved, and the Company shall at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Securities, a number of shares sufficient to provide for the exercise of the Warrants.


ARTICLE 3

OTHER PROVISIONS RELATING TO RIGHTS
OF HOLDERS OF WARRANT CERTIFICATES

        3.1    No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.     No Warrant Certificate or Warrant evidenced thereby shall entitle the holder thereof to any of the rights of a holder of Warrant Securities, including, without limitation, the right to receive the payment of

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dividends or distributions, if any, on the Warrant Securities or to exercise any voting rights, except to the extent expressly set forth in this Agreement or the applicable Warrant Certificate.

        3.2    Lost, Stolen, Mutilated or Destroyed Warrant Certificates.     Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate and/or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like number of Warrant Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.

        3.3    Holder of Warrant Certificate May Enforce Rights.     Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the holder of any Warrant Securities or the holder of any other Warrant Certificate, may, in such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, such holder's right to exercise the Warrants evidenced by such holder's Warrant Certificate in the manner provided in such holder's Warrant Certificate and in this Agreement.

        3.4    Adjustments.     

        (a)   In case the Company shall at any time subdivide its outstanding shares of [title of Depositary Shares purchasable through exercise of Warrants] into a greater number of shares, the Warrant Price in effect immediately prior to such subdivision shall be proportionately reduced and the number of Warrant Securities purchasable under the Warrants shall be proportionately increased. Conversely, in case the outstanding shares of [title of Depositary Shares purchasable through exercise of Warrants] of the Company shall be combined into a smaller number of shares, the Warrant Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Securities purchasable under the Warrants shall be proportionately decreased.

        (b)   If at any time or from time to time the holders of [title of Preferred Stock underlying the Depositary Shares purchasable through exercise of Warrants] (or any shares of stock or other securities at the time receivable upon the exercise of the Warrants) shall have received or become entitled to receive, without payment therefore,

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then and in each such case, the holder of each Warrant shall, upon the exercise of the Warrant, be entitled to receive, in addition to the number of Warrant Securities receivable thereupon, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash and indebtedness (or rights to subscribe for or purchase indebtedness) which such holder would hold on the date of such exercise had he been the holder of record of such Warrant Securities as of the date on which holders of [title of Preferred Stock underlying Depositary Shares purchasable through exercise of Warrants] received or became entitled to receive such shares or all other additional stock and other securities and property.

        (c)   In case of (i) any reclassification, capital reorganization, or change in the [title of Depositary Shares purchasable through exercise of Warrants] or [title of Preferred Stock underlying Depositary Shares purchasable through the exercise of the Warrants] of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 3.4(a) or Section 3.4(b) above), (ii) share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation and which does not result in any change in the [title of Depositary Shares purchasable through exercise of Warrants] or [title of Preferred Stock underlying Depositary Shares purchasable through the exercise of the Warrants] other than the issuance of additional shares of [title of Depositary Shares purchasable through exercise of Warrants] or [title of Preferred Stock underlying Depositary Shares purchasable through the exercise of the Warrants]) or (iii) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a "Reorganization Event"), then, as a condition of such Reorganization Event, lawful provisions shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holders of the Warrants, so that the holders of the Warrants shall have the right at any time prior to the expiration of the Warrants to purchase, at a total price equal to that payable upon the exercise of the Warrants, the kind and amount of shares of stock and other securities and property receivable in connection with such Reorganization Event by a holder of the same number of shares of [title of Depositary Shares purchasable through the exercise of the Warrants] as were purchasable by the holders of the Warrants immediately prior to such Reorganization Event. In any such case appropriate provisions shall be made with respect to the rights and interests of the holders of the Warrants so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise the Warrants, and appropriate adjustments shall be made to the Warrant Price payable hereunder provided the aggregate purchase price shall remain the same. In the case of any transaction described in clauses (ii) and (iii) above, the Company shall thereupon be relieved of any further obligation hereunder or under the Warrants, and the Company as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming entity thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable hereunder which heretofore shall not have been signed by the Company, and may

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execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution hereof. In any case of any such Reorganization Event, such changes in phraseology and form (but not in substance) may be made in the Warrants thereafter to be issued as may be appropriate.

        The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that any such Reorganization Event complies with the provisions of this Section 3.4.

        (d)   The Company may, at its option, at any time until the Expiration Date, reduce the then current Warrant Price to any amount deemed appropriate by the Board of Directors of the Company for any period not exceeding twenty consecutive days (as evidenced in a resolution adopted by such Board of Directors), but only upon giving the notices required by Section 3.5 at least ten days prior to taking such action.

        (e)   Except as herein otherwise expressly provided, no adjustment in the Warrant Price shall be made by reason of the issuance of any securities of the Company or for any other reason whatsoever.

        (f)    No fractional Warrant Securities shall be issued upon the exercise of Warrants. If more than one Warrant shall be exercised at one time by the same holder, the number of full Warrant Securities which shall be issuable upon such exercise shall be computed on the basis of the aggregate number of Warrant Securities purchased pursuant to the Warrants so exercised. Instead of any fractional Warrant Security which would otherwise be issuable upon exercise of any Warrant, the Company shall pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the last sales price (or bid price if there were no sales) per Warrant Security, in either case as reported on the New York Stock Exchange Composite Tape on the business day which next precedes the day of exercise or, if the Warrant Securities are not then listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the Warrant Securities are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of the National Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ"), or if the Warrant Securities are not then listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the Warrant Securities are not quoted by any such organization, an amount equal to the same fraction of the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose at the close of business on the business day which next precedes the day of exercise.

        (g)   Whenever the Warrant Price then in effect is adjusted as herein provided, the Company shall mail to each holder of the Warrants at such holder's address as it shall appear on the books of the Company a statement setting forth the adjusted Warrant Price then and thereafter effective under the provisions hereof, together with the facts, in reasonable detail, upon which such adjustment is based.

        3.5    Notice to Warrantholders.     In case the Company shall (a) effect any dividend or distribution described in Section 3.4(b), (b) effect any Reorganization Event, (c) make any distribution on or in respect of the [title of Depositary Shares purchasable through exercise of Warrants] or [title of Preferred Stock underlying Depositary Shares purchasable through the exercise of the Warrants] in connection with the dissolution, liquidation or winding up of the Company, or (d) reduce the then current Warrant Price pursuant to Section 3.4(d), then the Company shall mail to each holder of Warrants at such holder's address as it shall appear on the books of the Warrant Agent, at least ten days prior to the applicable date hereinafter specified, a notice stating (x) the record date for such dividend or distribution, or, if a record is not to be taken, the date as of which the holders of record of

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[title of Preferred Stock underlying Depositary Shares purchasable through the exercise of Warrants] that will be entitled to such dividend or distribution are to be determined, (y) the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of [title of Depositary Shares purchasable through the exercise of the Warrants] of record shall be entitled to exchange their shares of [title of Depositary Shares purchasable through the exercise of the Warrants] for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up, or (z) the first date on which the then current Warrant Price shall be reduced pursuant to Section 3.4(d). No failure to mail such notice nor any defect therein or in the mailing thereof shall affect any such transaction or any adjustment in the Warrant Price required by Section 3.4.

        3.6    [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.     

        (a)   At any time on or after            , the Company shall have the right to accelerate any or all Warrants at any time by causing them to expire at the close of business on the day next preceding a specified date (the "Acceleration Date"), if the Market Price (as hereinafter defined) of the [title of Depositary Shares purchasable through the exercise of the Warrants] equals or exceeds            percent (    %) of the then effective Warrant Price on any twenty Trading Days (as hereinafter defined) within a period of thirty consecutive Trading Days ending no more than five Trading Days prior to the date on which the Company gives notice to the Warrant Agent of its election to accelerate the Warrants.

        (b)   "Market Price" for each Trading Day shall be, if the [title of Depositary Shares purchasable through the exercise of the Warrants] is listed or admitted for trading on the New York Stock Exchange, the last reported sale price, regular way (or, if no such price is reported, the average of the reported closing bid and asked prices, regular way) of [title of Depositary Shares purchasable through the exercise of the Warrants], in either case as reported on the New York Stock Exchange Composite Tape or, if the [title of Depositary Shares purchasable through the exercise of the Warrants] is not listed or admitted to trading on the New York Stock Exchange, on the principal national securities exchange on which the [title of Depositary Shares purchasable through the exercise of the Warrants] is listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, on the National Market System of NASDAQ or, if not listed or admitted to trading on any national securities exchange or quoted on the National Market System of NASDAQ, the average of the closing high bid and low asked prices in the over-the-counter market, as reported by NASDAQ, or such other system then in use, or if on any such date the shares of [title of Depositary Shares purchasable through the exercise of the Warrants] are not quoted by any such organization, the average of the closing bid and asked prices as furnished by any New York Stock Exchange firm selected from time to time by the Company for that purpose. "Trading Day" shall be each Monday through Friday, other than any day on which securities are not traded in the system or on the exchange that is the principal market for the [title of Depositary Shares purchasable through the exercise of the Warrants], as determined by the Board of Directors of the Company.

        (c)   In the event of an acceleration of less than all of the Warrants, the Warrant Agent shall select the Warrants to be accelerated by lot, pro rata or in such other manner as it deems, in its discretion, to be fair and appropriate.

        (d)   Notice of an acceleration specifying the Acceleration Date shall be sent by mail first class, postage prepaid, to each registered holder of a Warrant Certificate representing a Warrant accelerated at such holder's address appearing on the books of the Warrant Agent not more than sixty days nor less than thirty days before the Acceleration Date. Such notice of an acceleration also shall be given no more than twenty days, and no less than ten days, prior to the mailing of notice to registered holders of Warrants pursuant to this Section 3.6, by publication at least once in a newspaper of general circulation in the City of New York.

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        (e)   Any Warrant accelerated may be exercised until [    ] p.m., [City] time, on the business day next preceding the Acceleration Date. The Warrant Price shall be payable as provided in Section 2.]


ARTICLE 4

EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES

        4.1    Exchange and Transfer of Warrant Certificates.     [If Other Securities with Warrants which are immediately detachable—Upon] [If Other Securities with Warrants which are not immediately detachable—Prior to the Detachable Date, a Warrant Certificate may be exchanged or transferred only together with the Other Security to which the Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with an exchange or transfer of such Other Security. Prior to any Detachable Date, each transfer of the Other Security shall operate also to transfer the related Warrant Certificates. After the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided that such other Warrant Certificates evidence Warrants for the same aggregate number of Warrant Securities as the Warrant Certificates so surrendered. The Warrant Agent shall keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, upon surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. No service charge shall be made for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. Whenever any Warrant Certificates are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent shall not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Security or a number of Warrants for a whole number of Warrant Securities and a fraction of a Warrant Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.

        4.2    Treatment of Holders of Warrant Certificates.     [If Other Securities and Warrants are not immediately detachable—Prior to the Detachable Date, the Company, the Warrant Agent and all other persons may treat the owner of the Other Security as the owner of the Warrant Certificates initially attached thereto for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced by such Warrant Certificates, any notice to the contrary notwithstanding. After the Detachable Date and prior to due presentment of a Warrant Certificate for registration of transfer, the] [T]he Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.

        4.3    Cancellation of Warrant Certificates.     Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in

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exchange therefor or in lieu thereof. The Warrant Agent shall deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.


ARTICLE 5

CONCERNING THE WARRANT AGENT

        5.1    Warrant Agent.     The Company hereby appoints            as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and            hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and hereby and such further powers and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof.

        5.2    Conditions of Warrant Agent's Obligations.     The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following to all of which the Company agrees and to all of which the rights hereunder of the holders from time to time of the Warrant Certificates shall be subject:

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        5.3    Resignation and Appointment of Successor.     

        (a)   The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable.

        (b)   The Warrant Agent may at any time resign as agent by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided that such date shall not be less than three months after the date on which such notice is given unless the Company otherwise agrees. The Warrant Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company and specifying such removal and the intended date when it shall become effective. Such resignation or removal shall take effect upon the appointment by the Company, as hereinafter provided, of a successor Warrant Agent (which shall be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of such appointment by such successor Warrant Agent. The obligation of the Company under Section 5.2(a) shall continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.

        (c)   In case at any time the Warrant Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action, or a decree or order for relief by a court having jurisdiction in the premises shall have been entered in respect of the Warrant Agent in an

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involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer shall take charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder.

        (d)   Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor, as Warrant Agent hereunder.

        (e)   Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.


ARTICLE 6

MISCELLANEOUS

        6.1    Amendment.     This Agreement may be amended by the parties hereto, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action shall not materially adversely affect the interests of the holders of the Warrant Certificates.

        6.2    Notices and Demands to the Company and Warrant Agent.     If the Warrant Agent shall receive any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company.

        6.3    Addresses.     Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to            , Attention:            and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to Primus Telecommunications Group, Incorporated, 1700 Old Meadow Road, McLean, Virginia 22102, Attention: General Counsel (or such other address as shall be specified in writing by the Warrant Agent or by the Company).

        6.4    Governing Law.     This Agreement and each Warrant Certificate issued hereunder shall be governed by and construed in accordance with the laws of the State of New York.

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        6.5    Delivery of Prospectus.     The Company shall furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Securities deliverable upon exercise of the Warrants (the "Prospectus"), and the Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued upon such exercise, a Prospectus.

The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.

        6.6    Obtaining of Governmental Approvals.     The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.

        6.7    Persons Having Rights Under Warrant Agreement.     Nothing in this Agreement shall give to any person other than the Company, the Warrant Agent and the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.

        6.8    Headings.     The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

        6.9    Counterparts.     This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument.

        6.10    Inspection of Agreement.     A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit his Warrant Certificate for inspection by it.

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        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.

    PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
By
 
     
    Its  
     
Attest:      


 
 
 

 
 
 
 
   
Warrant Agent

 
 
By
 
     
    Its  
     
Attest:      


 
 
 


[SIGNATURE PAGE DEPOSITARY SHARES WARRANT AGREEMENT]


EXHIBIT A

FORM OF WARRANT CERTIFICATE
[Face of Warrant Certificate]

[Form if Warrants are attached to Other Securities and are not immediately detachable.   Prior to            , this Warrant Certificate cannot be transferred or exchanged unless attached to a [Title of Other Securities].]

[Form of Legend if Warrants are not immediately exercisable.
 
Prior to            , Warrants evidenced by this Warrant Certificate cannot be exercised.]

EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN

VOID AFTER [    ] P.M., [CITY] TIME, ON                  ,

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT SECURITIES]

No.   Warrants

        This certifies that                        or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner [if Warrants are attached to Other Securities and are not immediately detachable—, subject to the registered owner qualifying as a "Holder" of this Warrant Certificate, as hereinafter defined),] to purchase, at any time [after [            ] p.m., [City] time, on            and] on or before [    ] p.m., [City] time, on            ,            shares of [Title of Warrant Securities] (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated (the "Company") on the following basis: during the period from            , through and including            , the exercise price per Warrant Security will be $                              , subject to adjustment as provided in the Warrant Agreement (as hereinafter defined) (the "Warrant Price"). The Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Security with respect to which this Warrant is exercised to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the purchase form on the back hereof duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the "Warrant Agent"), which is, on the date hereof, at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined).

        The term "Holder" as used herein shall mean [if Warrants are attached to Other Securities and are not immediately detachable—prior to            ,    (the "Detachable Date"), the registered owner of the Company's [title of Other Securities]to which this Warrant Certificate was initially attached, and after such Detachable Date,] the person in whose name at the time this Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose pursuant to Section 4 of the Warrant Agreement.

        The Warrants evidenced by this Warrant Certificate may be exercised to purchase a whole number of Warrant Securities in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Holder hereof a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.

A-1


        This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of            ,    (the "Warrant Agreement"), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Holder of this Warrant Certificate consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.

        [If Warrants are attached to Other Securities and are not immediately detachable—Prior to the Detachable Date, this Warrant Certificate may be exchanged or transferred only together with the [Title of Other Securities] (the "Other Securities") to which this Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with, an exchange or transfer of such Other Security. Additionally, on or prior to the Detachable Date, each transfer of such Other Security on the register of the Other Securities shall operate also to transfer this Warrant Certificate. After such date, transfer of this] [If Warrants are attached to Other Securities and are immediately detachable—Transfer of this] Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner's assigns, in the manner and subject to the limitations provided in the Warrant Agreement.

        [If Other Securities with Warrants which are not immediately detachable—Except as provided in the immediately preceding paragraph, after] [If Other Securities with Warrants which are immediately detachable or Warrants alone—After] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate number of Warrant Securities.

        This Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of dividends or distributions, if any, on the Warrant Securities (except to the extent set forth in the Warrant Agreement) or to exercise any voting rights.

        Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

        This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent.

        IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.

Dated:   PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
 
By
 
       
      Its  
       
Attest:      

 
 
 
 
 
     

 
 
 
 
 
Countersigned:      

 
 
 
 
 
As Warrant Agent		      

By
 
 
 
 
 
Authorized Signature
 		     

A-2

[REVERSE OF WARRANT CERTIFICATE]

(Instructions for Exercise of Warrant)

To exercise any Warrants evidenced hereby for Warrant Securities (as hereinafter defined), the Holder must pay, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent] [address of Warrant Agent], Attn:            , which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.

(To be executed upon exercise of Warrants)

        The undersigned hereby irrevocably elects to exercise            Warrants, evidenced by this Warrant Certificate, to purchase            shares of the [Title of Warrant Securities] (the "Warrant Securities"), of Primus Telecommunications Group, Incorporated and represents that he has tendered payment for such Warrant Securities, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Primus Telecommunications Group, Incorporated, c/o [insert name and address of Warrant Agent], in the amount of $                              in accordance with the terms hereof. The undersigned requests that said Warrant Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.

        If the number of Warrants exercised is less than all of the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the number of Warrant Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.


 
 
 
 

Dated
 
Name
 
     
(Please Print)

 
 
Address
 
     

 
 

A-3


 
 

 
(Insert Social Security or Other Identifying Number of Holder)

Signature Guaranteed
Signature

 
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange)

This Warrant may be exercised at the following addresses:

By hand at
 
 
   

 
 

 
 

By mail at
 
 
   

 
 

 
 

[Instructions as to form and delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Securities remaining unexercised—complete as appropriate.]

A-4

ASSIGNMENT

[Form of assignment to be executed if
Warrant Holder desires to transfer Warrant)

        FOR VALUE RECEIVED,                        hereby sells, assigns and transfers unto:


 
 
 


 
 


 
 

(Please print name and address including zip code)
 
Please insert Social Security or other identifying number

 
 
 

the right represented by the within Warrant to purchase            shares of [Title of Warrant Securities] of Primus Telecommunications Group, Incorporated to which the within Warrant relates and appoints            attorney to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.

 
 
 

Dated
 
Signature

 
 
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)

Signature Guaranteed
 
 

 
 
 


 
 

A-5



QuickLinks

TABLE OF CONTENTS
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED Form of Depositary Shares Warrant Agreement
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants.
1.2 Execution and Delivery of Warrant Certificates.
1.3 Issuance of Warrant Certificates.
ARTICLE 2 WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price.
2.2 Duration of Warrants.
2.3 Exercise of Warrants.
ARTICLE 3 OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
3.1 No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights.
3.4 Adjustments.
3.5 Notice to Warrantholders.
3.6 [If the Warrants are subject to acceleration by the Company, insert—Acceleration of Warrants by the Company.
ARTICLE 4 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates.
4.2 Treatment of Holders of Warrant Certificates.
4.3 Cancellation of Warrant Certificates.
ARTICLE 5 CONCERNING THE WARRANT AGENT
5.1 Warrant Agent.
5.2 Conditions of Warrant Agent's Obligations.
5.3 Resignation and Appointment of Successor.
ARTICLE 6 MISCELLANEOUS
6.1 Amendment.
6.2 Notices and Demands to the Company and Warrant Agent.
6.3 Addresses.
6.4 Governing Law.
6.5 Delivery of Prospectus.
6.6 Obtaining of Governmental Approvals.
6.7 Persons Having Rights Under Warrant Agreement.
6.8 Headings.
6.9 Counterparts.
6.10 Inspection of Agreement.
EXHIBIT A FORM OF WARRANT CERTIFICATE [Face of Warrant Certificate]

QuickLinks -- Click here to rapidly navigate through this document

Exhibit 4.10

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

and

                        , As Warrant Agent

FORM OF DEBT SECURITIES
WARRANT AGREEMENT

Dated As Of                        


TABLE OF CONTENTS

 
  
   Page
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES   1
  1.1 Issuance of Warrants   1
  1.2 Execution and Delivery of Warrant Certificates   2
  1.3 Issuance of Warrant Certificates   3

ARTICLE 2
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
 
3
  2.1 Warrant Price   3
  2.2 Duration of Warrants   3
  2.3 Exercise of Warrants   3

ARTICLE 3
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
 
5
  3.1 No Rights as Holders of Warrant Debt Securities Conferred by Warrants or Warrant Certificates   5
  3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates   5
  3.3 Holder of Warrant Certificate May Enforce Rights   5
  3.4 Merger, Sale, Conveyance or Lease   5
  3.5 Notice to Warrantholders   6

ARTICLE 4
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
 
6
  4.1 Exchange and Transfer of Warrant Certificates   6
  4.2 Treatment of Holders of Warrant Certificates   7
  4.3 Cancellation of Warrant Certificates   7

ARTICLE 5
CONCERNING THE WARRANT AGENT
 
7
  5.1 Warrant Agent   7
  5.2 Conditions of Warrant Agent's Obligations   8
  5.3 Resignation, Removal and Appointment of Successors   9

ARTICLE 6
MISCELLANEOUS
 
11
  6.1 Amendment   11
  6.2 Notices and Demands to the Company and Warrant Agent   11
  6.3 Addresses   11
  6.4 Governing Law   11
  6.5 Delivery of Prospectus   11
  6.6 Obtaining of Governmental Approvals   11
  6.7 Persons Having Rights Under Warrant Agreement   12
  6.8 Headings   12
  6.9 Counterparts   12
  6.10 Inspection of Agreement   12

i


PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
Form of Debt Securities Warrant Agreement

        DEBT SECURITIES WARRANT AGREEMENT, dated as of                        between PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a Delaware corporation (the "Company") and                        , a [corporation] [national banking association] organized and existing under the laws of                        and having a corporate trust office in                        , as warrant agent (the "Warrant Agent").

        WHEREAS, the Company has entered into an indenture dated as of [                        (the "Senior Indenture"), with                        , as trustee (such trustee, and any successors to such trustee, herein called the "Senior Trustee"), providing for the issuance from time to time of its unsubordinated debt securities, to be issued in one or more series as provided in the Senior Indenture (the "Debt Securities");] [                        (the "Subordinated Indenture"), with                         , as trustee (such trustee, and any successors to such trustee, herein called the "Subordinated Trustee"), providing for the issuance from time to time of its subordinated debt securities, to be issued in one or more series as provided in the Subordinated Indenture (the "Debt Securities");]

        WHEREAS, the Company proposes to sell [If Warrants are sold with other securities—title of such other Securities being offered (the "Other Securities") with] warrant certificates evidencing one or more warrants (the "Warrants" or, individually, a "Warrant") representing the right to purchase [title of Debt Securities purchasable through exercise of Warrants] (the "Warrant Debt Securities"), such warrant certificates and other warrant certificates issued pursuant to this Agreement being herein called the "Warrant Certificates"; and

        WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to set forth, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced;

        NOW, THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows:


ARTICLE 1

ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES

        1.1    Issuance of Warrants.     [If Warrants alone—Upon issuance, each Warrant Certificate shall evidence one or more Warrants.] [If Other Securities and Warrants—Warrant Certificates shall be [initially] issued in connection with the issuance of the Other Securities [but shall be separately transferable on and after                                                                          (the "Detachable Date")] [and shall not be separately transferable] and each Warrant Certificate shall evidence one or more Warrants.] Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase one Warrant Debt Security. [If Other Securities and Warrants—Warrant Certificates shall be initially issued in units with the Other Securities and each Warrant Certificate included in such a unit shall evidence                        Warrants for each [$                        principal amount] [                         shares] of Other Securities included in such unit.].

        1.2    Execution and Delivery of Warrant Certificates.     Each Warrant Certificate, whenever issued, shall be in registered form substantially in the form set forth in Exhibit A hereto, shall be dated the date of its countersignature by the Warrant Agent and may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be

1

conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced thereon. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.

        No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence that the Warrant Certificate so countersigned has been duly issued hereunder.

        In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.

        The term "holder" or "holder of a Warrant Certificate" as used herein shall mean any person in whose name at the time any Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose [If Other Securities and Warrants are not immediately detachable—or upon the registration of the Other Securities prior to the Detachable Date. Prior to the Detachable Date, the Company will, or will cause the registrar of the Other Securities to, make available at all times to the Warrant Agent such information as to holders of the Other Securities as may be necessary to keep the Warrant Agent's records up to date].

        1.3    Issuance of Warrant Certificates.     Warrant Certificates evidencing the right to purchase Warrant Debt Securities may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign such Warrant Certificates and shall deliver such Warrant Certificates to or upon the order of the Company.


ARTICLE 2

WARRANT PRICE, DURATION AND
EXERCISE OF WARRANTS

        2.1    Warrant Price.     During the period specified in Section 2.2, each Warrant shall, subject to the terms of this Warrant Agreement and the applicable Warrant Certificate, entitle the holder thereof, to purchase the principal amount of Warrant Debt Securities specified in the applicable Warrant Certificate at an exercise price of            % of the principal amount thereof [plus accrued amortization, if any, of the original issue discount of the Warrant Debt Securities] [plus accrued interest, if any, from the most recent date from which interest shall have been paid on the Warrant Debt Securities or, if no interest shall have been paid on the Warrant Debt Securities, from the date of their initial issuance.] [The original issue discount ($            for each $1,000 principal amount of Warrant Debt Securities)

2

will be amortized at a            % annual rate, computed on a[n] [semi-] annual basis [using a 360-day year consisting of twelve 30-day months].] Such purchase price for the Warrant Debt Securities is referred to in this Agreement as the "Warrant Price."

        2.2    Duration of Warrants.     Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [            ] and at or before [            ] p.m., [City] time, on            or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the "Expiration Date"). Each Warrant not exercised at or before [            ] p.m., [City] time, on the Expiration Date shall become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement shall cease.

        2.3    Exercise of Warrants.     

        (a)   During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Debt Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Debt Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Debt Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate as aforesaid, be deemed to be the date on which the Warrant is exercised; provided, however, that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Debt Securities purchasable upon the exercise of such Warrants shall be closed, no such receipt of such Warrant Certificates and no such payment of such Warrant Price shall be effective to constitute the person so designated to be named as the holder of record of such Warrant Debt Securities on such date, but shall be effective to constitute such person as the holder of record of such Warrant Debt Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Debt Securities purchasable upon the exercise of such Warrants shall be opened, and the certificates for the Warrant Debt Securities in respect of which such Warrants are then exercised shall be issuable as of the date on such next succeeding day on which the transfer books shall next be opened, and until such date the Company shall be under no duty to deliver any certificate for such Warrant Debt Securities. The Warrant Agent shall deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and shall advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such telephone advice to the Company in writing.

        (b)   The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Debt Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing such Warrants with respect to delivery of the Warrant Debt Securities to which such holder is entitled upon such exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Debt Securities after such exercise, and (iv) such other information as the Company or the [Senior] [Subordinated] Trustee shall reasonably require.

        (c)   As soon as practicable after the exercise of any Warrant, the Company shall issue, pursuant to the Indenture, in authorized denominations, to or upon the order of the holder of the Warrant Certificate evidencing such Warrant, the Warrant Debt Securities to which such holder is entitled, in fully registered form, registered in such name or names as may be directed by such holder. If fewer

3


than all of the Warrants evidenced by such Warrant Certificate were exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Debt Securities remaining unexercised.

        (d)   The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Debt Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Debt Securities until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due.


ARTICLE 3

OTHER PROVISIONS RELATING TO RIGHTS OF
HOLDERS OF WARRANT CERTIFICATES

        3.1    No Rights as Holders of Warrant Debt Securities Conferred by Warrants or Warrant Certificates.     No Warrant Certificate or Warrant evidenced thereby shall entitle the holder thereof to any of the rights of a holder of Warrant Debt Securities, including, without limitation, the right to receive the payment of principal of (or premium, if any) or interest, if any, on the Warrant Debt Securities or to enforce any of the covenants in the Indenture.

        3.2    Lost, Stolen, Mutilated or Destroyed Warrant Certificates.     Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate and/or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like principal amount of Warrant Debt Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.

        3.3    Holder of Warrant Certificate May Enforce Rights.     Notwithstanding any of the provisions of this Agreement, any holder of any Warrant Certificate, without the consent of the Warrant Agent, the [Senior] [Subordinated] Trustee, the holder of any Warrant Debt Securities or the holder of any other Warrant Certificate, may, in such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, such holder's right to exercise the Warrants evidenced by such holder's Warrant Certificate in the manner provided in such holder's Warrant Certificates and in this Agreement.

        3.4    Merger, Sale, Conveyance or Lease.     In case of (a) any share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation) or (b) the sale,

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exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a "Reorganization Event"), then, as a condition of such Reorganization Event, lawful provisions shall be made, and duly executed documents evidencing the same from the Company's successor shall be delivered to the holders of the Warrants, so that such successor shall succeed to and be substituted for the Company, and assume all the Company's obligations under, this Agreement and the Warrants. The Company shall thereupon be relieved of any further obligation hereunder or under the Warrants, and the Company as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming entity thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable hereunder which heretofore shall not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Debt Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution hereof. In any case of any such Reorganization Event, such changes in phraseology and form (but not in substance) may be made in the Warrants thereafter to be issued as may be appropriate.

        The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that any such Reorganization Event complies with the provisions of this Section 3.4.

        3.5    Notice to Warrantholders.     In case the Company shall (a) effect any Reorganization Event or (b) make any distribution on or in respect of the [title of Warrant Debt Securities] in connection with the dissolution, liquidation or winding up of the Company, then the Company shall mail to each holder of Warrants at such holder's address as it shall appear on the books of the Warrant Agent, at least ten days prior to the applicable date hereinafter specified, a notice stating the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of [title of Warrant Debt Securities] of record shall be entitled to exchange their shares of [title of Warrant Debt Securities] for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect any such transaction.


ARTICLE 4

EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES

        4.1    Exchange and Transfer of Warrant Certificates.     [If Other Securities with Warrants which are immediately detachable—Upon] [If Other Securities with Warrants which are not immediately detachable—Prior to the Detachable Date, a Warrant Certificate may be exchanged or transferred only together with the Other Security to which the Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with an exchange or transfer of such Other Security. Prior to any Detachable Date, each transfer of the Other Security shall operate also to transfer the related Warrant Certificates. After the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided that such other Warrant Certificates evidence Warrants for the same aggregate principal amount of Warrant Debt Securities as the Warrant Certificates so surrendered. The Warrant Agent shall keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, upon surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. No service charge shall be made for any exchange or registration

5

of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. Whenever any Warrant Certificates are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent shall not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Debt Security or a number of Warrants for a whole number of Warrant Debt Securities and a fraction of a Warrant Debt Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.

        4.2    Treatment of Holders of Warrant Certificates.     [If Other Securities and Warrants are not immediately detachable—Prior to the Detachable Date, the Company, the Warrant Agent and all other persons may treat the owner of the Other Security as the owner of the Warrant Certificates initially attached thereto for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced by such Warrant Certificates, any notice to the contrary notwithstanding. After the Detachable Date and prior to due presentment of a Warrant Certificate for registration of transfer, the] [The] Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.

        4.3    Cancellation of Warrant Certificates.     Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in exchange therefor or in lieu thereof. The Warrant Agent shall deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.


ARTICLE 5

CONCERNING THE WARRANT AGENT

        5.1    Warrant Agent.     The Company hereby appoints                        as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and                        hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and hereby and such further power and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such power and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof.

        5.2    Conditions of Warrant Agent's Obligations.     The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following to all of which the Company agrees and to all of which the rights hereunder of the holders from time to time of the Warrant Certificates shall be subject:

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        5.3    Resignation, Removal and Appointment of Successors.     

        (a)   The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable.

        (b)   The Warrant Agent may at any time resign as agent by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided that such date shall not be less than three months after the date on which such notice is given unless the Company otherwise agrees. The Warrant Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company and specifying such removal and the intended date when it shall become effective. Such resignation or removal shall take effect upon the appointment by the Company, as hereinafter provided, of a successor Warrant Agent (which shall be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of such appointment by such successor Warrant Agent. The obligation of the Company under Section 5.2(a) shall continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.

        (c)   In case at any time the Warrant Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action, or a decree or order for relief by a court having jurisdiction in the premises shall have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer shall take charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder.

        (d)   Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor, as Warrant Agent hereunder.

        (e)   Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to

8


which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.


ARTICLE 6

MISCELLANEOUS

        6.1    Amendment.     This Agreement may be amended by the parties hereto, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action shall not materially adversely affect the interests of the holders of the Warrant Certificates.

        6.2    Notices and Demands to the Company and Warrant Agent.     If the Warrant Agent shall receive any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company.

        6.3    Addresses.     Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to                         , Attention:                         and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to Primus Telecommunications Group, Incorporated, 1700 Old Meadow Road, McLean, Virginia 22102, Attention: General Counsel (or such other address as shall be specified in writing by the Warrant Agent or by the Company).

        6.4    Governing Law.     This Agreement and each Warrant Certificate issued hereunder shall be governed by and construed in accordance with the laws of the State of [                        ].

        6.5    Delivery of Prospectus.     The Company shall furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Debt Securities deliverable upon exercise of the Warrants (the "Prospectus"), and the Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Debt Securities issued upon such exercise, a Prospectus.

The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.

        6.6    Obtaining of Governmental Approvals.     The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Debt Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Debt Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.

        6.7    Persons Having Rights Under Warrant Agreement.     Nothing in this Agreement shall give to any person other than the Company, the Warrant Agent and the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.

9

        6.8    Headings.     The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

        6.9    Counterparts.     This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument.

        6.10    Inspection of Agreement.     A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit his Warrant Certificate for inspection by it.

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        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.

    PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED  

 
 
By
 
 
     
    Its    
     
Attest:        


 
 
 
 

 
 
 
 
, as
   
Warrant Agent		  

 
 
By
 
 
     
    Its    
     
Attest:        


 
 
 
 


[SIGNATURE PAGE TO DEBT SECURITIES WARRANT AGREEMENT]


EXHIBIT A

FORM OF WARRANT CERTIFICATE
[Face of Warrant Certificate]

[Form if Warrants are attached to Other Securities and are not immediately detachable.   Prior to            , this Warrant Certificate cannot be transferred or exchanged unless attached to a [Title of Other Security].]

[Form of Legend if Warrants are not immediately exercisable.
 
Prior to            , Warrants evidenced by this Warrant Certificate cannot be exercised.]

EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN

VOID AFTER [    ] P.M., [CITY] TIME, ON                  ,                   

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT DEBT SECURITIES]

No.   Warrants

        This certifies that                        or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner [If Warrants are attached to Other Securities and are not immediately detachable—, subject to the registered owner qualifying as a "Holder" of this Warrant Certificate, as hereinafter defined)] to purchase, at any time [after [            ] p.m., [City] time, on            and] on or before [    ] p.m., [City] time, on            , $                              principal amount of [Title of Warrant Debt Securities] (the "Warrant Debt Securities"), of Primus Telecommunications Group, Incorporated (the "Company"), issued or to be issued under the Indenture (as hereinafter defined), on the following basis: during the period from            , through and including            , each Warrant shall entitle the Holder thereof, subject to the provisions of this Agreement, to purchase the principal amount of Warrant Debt Securities stated in the Warrant Certificate at the warrant price (the "Warrant Price") of    % of the principal amount thereof [plus accrued amortization, if any, of the original issue discount of the Warrant Debt Securities] [plus accrued interest, if any, from the most recent date from which interest shall have been paid on the Warrant Debt Securities or, if no interest shall have been paid on the Warrant Debt Securities, from the date of their original issuance]. [The original issue discount ($    for each $1,000 principal amount of Warrant Debt Securities) will be amortized at a    % annual rate, computed on a[n] [semi-]annual basis [using a 360-day year consisting of twelve 30-day months]. The Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Debt Security with respect to which this Warrant is exercised to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the purchase form on the back hereof duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the "Warrant Agent"), which is, on the date hereof, at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined).

        The term "Holder" as used herein shall mean [If Warrants are attached to Other Securities and are not immediately detachable—, prior to            ,    (the "Detachable Date"), the registered owner of the Company's [title of Other Securities]to which this Warrant Certificate was initially attached, and after

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such Detachable Date,] the person in whose name at the time this Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose pursuant to Section 4 of the Warrant Agreement.

        The Warrants evidenced by this Warrant Certificate may be exercised to purchase Warrant Debt Securities in the principal amount of $1,000 or any integral multiple thereof in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Holder hereof a new Warrant Certificate evidencing Warrants for the aggregate principal amount of Warrant Debt Securities remaining unexercised.

        This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of            ,    (the "Warrant Agreement"), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Holder of this Warrant Certificate consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.

        The Warrant Debt Securities to be issued and delivered upon the exercise of Warrants evidenced by this Warrant Certificate will be issued under and in accordance with an Indenture, [dated as of            ,            (the "Senior Indenture"), between the Company and            , as trustee (such trustee, and any successors to such trustee, the "Senior Trustee")] [dated as of            ,    , (the "Subordinated Indenture"), between the Company and            , as trustee (such trustee, and any successors to such trustee, the "Subordinated Trustee")]and will be subject to the terms and provisions contained in the Warrant Debt Securities and in the Indenture. Copies of the [Senior][Subordinated] Indenture, including the form of the Warrant Debt Securities, are on file at the corporate trust office of the Trustee.

        [If Warrants are attached to Other Securities and are not immediately detachable—Prior to the Detachable Date, this Warrant Certificate may be exchanged or transferred only together with the [Title of Other Securities] (the "Other Securities") to which this Warrant Certificate was initially attached, and only for the purpose of effecting or in conjunction with, an exchange or transfer of such Other Security. Additionally, on or prior to the Detachable Date, each transfer of such Other Security on the register of the Other Securities shall operate also to transfer this Warrant Certificate. After such date, transfer of this] [If Warrants are attached to Other Securities and are immediately detachable—Transfer of this] Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner's assigns, in the manner and subject to the limitations provided in the Warrant Agreement.

        [If Other Securities with Warrants which are not immediately detachable-Except as provided in the immediately preceding paragraph, after][If Other Securities with Warrants which are immediately detachable or Warrants alone—After] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate principal amount of Warrant Debt Securities.

        This Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Debt Securities, including, without limitation, the right to receive payments of principal of (and premium, if any) or interest, if any, on the Warrant Debt Securities or to enforce any of the covenants of the Indenture.

        Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

        This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent.

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        IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.

Dated:   PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED

 
 
 
By
 
       
      Its  
       
Attest:      

 
 
 
 
 
     

 
 
 
 
 
Countersigned:      

 
 
 
 
 
As Warrant Agent		      

By
 
 
 
 
 
Authorized Signature
 		     

A-3

[REVERSE OF WARRANT CERTIFICATE]

(Instructions for Exercise of Warrants)

        To exercise any Warrants evidenced hereby for Warrant Debt Securities (as hereinafter defined), the Holder must pay, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent] [address of Warrant Agent], Attn:            , which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.

(To be executed upon exercise of Warrants)

        The undersigned hereby irrevocably elects to exercise            Warrants, represented by this Warrant Certificate, to purchase $                      principal amount of the [Title of Warrant Debt Securities] (the "Warrant Debt Securities") of Primus Telecommunications Group, Incorporated and represents that he has tendered payment for such Warrant Debt Securities, in lawful money of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Primus Telecommunications Group, Incorporated, c/o [insert name and address of Warrant Agent], in the amount of $                              in accordance with the terms hereof. The undersigned requests that said principal amount of Warrant Debt Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.

        If the number of Warrants exercised is less than all the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the aggregate principal amount of Warrant Debt Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.


 
 
 
 

Dated
 
Name
 
     
(Please Print)

 
 
Address
 
     

 
 

A-4


 
 

 
(Insert Social Security or Other Identifying Number of Holder)

Signature Guaranteed
Signature

 
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange)

This Warrant may be exercised at the following addresses:

By hand at
 
 
   

 
 

 
 

By mail at
 
 
   

 
 

 
 

[Instructions as to form and delivery of Warrant Debt Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Debt Securities remaining unexercised—complete as appropriate.]

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ASSIGNMENT

[Form of assignment to be executed if
Warrant Holder desires to transfer Warrant)

        FOR VALUE RECEIVED,                        hereby sells, assigns and transfers unto:


 
 
 


 
 


 
 

(Please print name and address including zip code)
 
Please insert Social Security or other identifying number

 
 
 

the right represented by the within Warrant to purchase $                              aggregate principal amount of [Title of Warrant Debt Securities] of Primus Telecommunications Group, Incorporated to which the within Warrant relates and appoints            attorney to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.

 
 
 

Dated
 
Signature

 
 
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)

Signature Guaranteed
 
 

 
 
 


 
 

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QuickLinks

TABLE OF CONTENTS
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED Form of Debt Securities Warrant Agreement
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants.
1.2 Execution and Delivery of Warrant Certificates.
1.3 Issuance of Warrant Certificates.
ARTICLE 2 WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price.
2.2 Duration of Warrants.
2.3 Exercise of Warrants.
ARTICLE 3 OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
3.1 No Rights as Holders of Warrant Debt Securities Conferred by Warrants or Warrant Certificates.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights.
3.4 Merger, Sale, Conveyance or Lease.
3.5 Notice to Warrantholders.
ARTICLE 4 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates.
4.2 Treatment of Holders of Warrant Certificates.
4.3 Cancellation of Warrant Certificates.
ARTICLE 5 CONCERNING THE WARRANT AGENT
5.1 Warrant Agent.
5.2 Conditions of Warrant Agent's Obligations.
5.3 Resignation, Removal and Appointment of Successors.
ARTICLE 6 MISCELLANEOUS
6.1 Amendment.
6.2 Notices and Demands to the Company and Warrant Agent.
6.3 Addresses.
6.4 Governing Law.
6.5 Delivery of Prospectus.
6.6 Obtaining of Governmental Approvals.
6.7 Persons Having Rights Under Warrant Agreement.
6.8 Headings.
6.9 Counterparts.
6.10 Inspection of Agreement.
EXHIBIT A FORM OF WARRANT CERTIFICATE [Face of Warrant Certificate]

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Exhibit 5.1

January 16, 2004

Primus Telecommunications Group, Incorporated
1700 Old Meadow Road, Suite 300
McLean, VA 22102

Ladies and Gentlemen:

        We have acted as counsel to Primus Telecommunications Group, Incorporated, a Delaware corporation (the "Company"), in connection with the Registration Statement on Form S-3 (the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"). The Company has provided us with a prospectus (the "Prospectus"), which forms part of the Registration Statement. The Prospectus provides that it will be supplemented in the future by one or more prospectus supplements (each, a "Prospectus Supplement"). The Registration Statement, including the Prospectus as supplemented from time to time by one or more Prospectus Supplements, will provide for the registration by the Company of:

        The Common Stock, the Preferred Stock, the Depositary Shares, the Senior Debt Securities, the Subordinated Debt Securities and the Warrants are collectively referred to herein as the "Securities." The Securities are being registered for offering and sale from time to time pursuant to Rule 415 under the Securities Act. The aggregate public offering price of the Securities being registered is $200,000,000.

        In connection with this opinion, we have examined and relied upon the originals, or copies certified to our satisfaction, of such records, documents, certificates, opinions, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. As to certain factual matters, we have relied upon certificates of the officers of the Company and have not sought to independently verify such matters.


        In rendering this opinion, we have assumed the genuineness and authenticity of all signatures on original documents; the authenticity of all documents submitted to us as originals; the conformity to originals of all documents submitted to us as copies; the accuracy, completeness and authenticity of certificates of public officials; and the due authorization, execution and delivery of all documents where authorization, execution and delivery are prerequisites to the effectiveness of such documents. With respect to our opinion as to the Common Stock and as to Securities convertible into Common Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Common Stock is authorized and reserved or available for issuance and that the cash consideration for the issuance and sale of such shares of Common Stock (or Preferred Stock or Debt Securities convertible into Common Stock) is not less than the par value of the Common Stock. With respect to our opinion as to the Preferred Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Preferred Stock is authorized, designated and reserved or available for issuance and that the cash consideration for the issuance and sale of such shares of Preferred Stock (or Debt Securities convertible into Preferred Stock) is not less than the par value of the Preferred Stock. With respect to our opinion as to the Depositary Shares (as defined below), we have assumed that, at the time of issuance and sale, a sufficient number of shares of Preferred Stock to be represented by the Depositary Shares is authorized, designated and reserved or available for issuance and that the consideration for the issuance and sale of such Depositary Shares is cash in an amount that is not less than the par value of the Preferred Stock represented by the Offered Depositary Shares. We have also assumed that any Depositary Receipts and any Warrants offered under the Registration Statement, and the related deposit agreement and warrant agreements, will be executed in the forms filed as exhibits to the Registration Statement. We have also assumed that (i) with respect to Securities being issued upon conversion of any convertible Preferred Stock or convertible Depositary Shares, the applicable convertible Preferred Stock or convertible Depositary Shares will be duly authorized, validly issued, fully paid and nonassessable; and (ii) with respect to any Securities being issued upon conversion of any convertible Debt Securities (as defined below), or upon exercise of any Warrants (as defined below), the applicable convertible Debt Securities or Warrants will be valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors' rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding at law or in equity).

        Our opinion herein is expressed solely with respect to the federal laws of the United States, the Delaware General Corporation Law and, as to the Debt Securities constituting valid and legally binding obligations of the Company, the laws of the State of New York. We express no opinion as to whether the laws of any jurisdiction are applicable to the subject matter hereof. We are not rendering any opinion as to compliance with any federal or state law, rule or regulation relating to securities, or to the sale or issuance thereof. For purposes of the opinions below, we have assumed that the Registration Statement and any required post-effective amendment thereto have all become effective under the Securities Act and the Prospectus and any and all Prospectus Supplement(s) required by applicable laws have been delivered as required by such laws.

        On the basis of the foregoing and in reliance thereon, and subject to the qualifications herein stated, we are of the opinion that:

        1.     With respect to the Common Stock offered under the Registration Statement, provided that (i) the issuance of the Common Stock has been duly authorized by all necessary corporate action on the part of the Company; (ii) the terms of the Common Stock and the issuance and sale of the Common Stock do not violate the certificate of incorporation or bylaws of the Company or any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and complies with any requirement imposed by any court or governmental body having jurisdiction over the Company; and (iii) the certificates for the Common Stock have been duly executed

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by the Company, countersigned by the transfer agent therefor and duly delivered to the purchasers thereof against payment therefor, then the shares of Common Stock, when issued and sold in accordance with a duly authorized, executed and delivered purchase, underwriting or similar agreement or upon conversion of any convertible Preferred Stock or convertible Offered Debt Securities (as defined below) under the Senior Indenture or the Subordinated Indenture, as applicable, or upon exercise of any Offered Warrants (as defined below) under the Warrant Agreement, will be duly authorized, validly issued, fully paid and nonassessable.

        2.     With respect to the Preferred Stock offered under the Registration Statement, provided that (i) the issuance of the Preferred Stock has been duly authorized by all necessary corporate action on the part of the Company; (ii) the terms of the Preferred Stock the issuance and sale of the Preferred Stock do not violate the certificate of incorporation or bylaws of the Company or any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and complies with any requirement imposed by any court or governmental body having jurisdiction over the Company; and (iii) the certificates for the Preferred Stock have been duly executed by the Company, countersigned by the transfer agent therefor and duly delivered to the purchasers thereof against payment therefor, then the shares of Preferred Stock, when issued and sold in accordance with a duly authorized, executed and delivered purchase, underwriting or similar agreement or upon conversion of any convertible Offered Debt Securities under the Senior Indenture or the Subordinated Indenture, as applicable, or upon exercise of any Offered Warrants under the Warrant Agreement, will be duly authorized, validly issued, fully paid and nonassessable.

        3.     With respect to any Depositary Shares offered under the Registration Statement (the "Offered Depositary Shares"), provided that (i) the issuance of the Depositary Shares has been duly authorized by all necessary corporate action on the part of the Company; (ii) the issuance and sale of the Depositary Shares does not violate any applicable law or the Certificate of Incorporation or the Bylaws or result in a default under or breach of any agreement or instrument binding upon the Company and complies with any applicable requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (iii) the Depositary Receipts evidencing the Depositary Shares have been duly executed by the Company, countersigned by the depositary therefor in accordance with the applicable deposit agreement and duly delivered to the purchasers thereof against payment therefor, then the Depositary Shares, when issued and sold as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s) and in accordance with any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement, or upon conversion of any convertible Preferred Stock or convertible Debt Securities in accordance with their terms, or upon exercise of any Warrants in accordance with their terms, will be duly authorized, validly issued, fully paid and nonassessable.

        4.     With respect to any series of the Debt Securities issued under the Subordinated Indenture or the Senior Indenture, as applicable, and offered under the Registration Statement (the "Offered Debt Securities"), provided that (i) the Subordinated Indenture or Senior Indenture, as applicable, has been duly authorized by the Company and the Trustee by all necessary corporate action; (ii) the Subordinated Indenture or the Senior Indenture, as applicable, in substantially the form filed as an exhibit to the Registration Statement, has been duly executed and delivered by the Company and the Trustee; (iii) the issuance and terms of the Offered Debt Securities have been duly authorized by the Company by all necessary corporate action; (iv) the terms of the Offered Debt Securities and of their issuance and sale have been duly established in conformity with the Subordinated Indenture or Senior Indenture, as applicable, so as not to violate any applicable law, the certificate of incorporation or bylaws of the Company, or result in a default under or breach of any agreement or instrument binding the Company, and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (v) the Offered Debt Securities have been duly executed and delivered by the Company and authenticated by the Trustee pursuant to the

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Subordinated Indenture or Senior Indenture, as applicable, and delivered against payment therefor, then the Offered Debt Securities, when issued and sold in accordance with the Subordinated Indenture and Senior Indenture, as applicable, the Registration Statement, and a duly authorized, executed and delivered purchase, underwriting or similar agreement, or upon exercise of any Offered Warrants under the Warrant Agreement, will be valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors' rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding at law or in equity).

        5.     With respect to the Warrants issued under the Warrant Agreement and offered under the Registration Statement (the "Offered Warrants"), provided that (i) the Warrant Agreement has been duly authorized by the Company and the Warrant Agent by all necessary corporate action; (ii) the Warrant Agreement, has been duly executed and delivered by the Company and the Warrant Agent; (iii) the issuance and terms of the Offered Warrants have been duly authorized by the Company by all necessary corporate action; (iv) the terms of the Offered Warrants and of their issuance and sale have been duly established in conformity with the Warrant Agreement so as not to violate any applicable law, the certificate of incorporation or bylaws of the Company, or result in a default under or breach of any agreement or instrument binding the Company, and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (v) the Offered Warrants have been duly executed and delivered by the Company and authenticated by the Warrant Agent pursuant to the Warrant Agreement and delivered against payment therefor, then the Offered Warrants, when issued and sold in accordance with the Warrant Agreement and a duly authorized, executed and delivered purchase, underwriting or similar agreement, will be valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors' rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding at law or in equity).

        We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the caption "Legal Matters" in the prospectus included in the Registration Statement.

Very truly yours,  

COOLEY GODWARD LLP
 

By:
 
 
 
Brian J. Lynch
 		 

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EXHIBIT 12.1


COMPUTATION OF RATIO OF EARNINGS
TO FIXED CHARGES (IN THOUSANDS)

 
   Year Ended December 31,
   Nine Months Ended September 30,
  
 
   2002
   2001
   2000
   1999
   1998
   2003
   2002
  
Earnings:                                            
Income (loss) before provision for income taxes, equity in loss of unconsolidated affiliate and cumulative effect of change in accounting principle   $ (27,228 )   (301,176 ) $ (174,664 ) $ (112,736 ) $ (63,648 ) $ 40,753   $ (13,867 )
Less: Minority interest     (446 )   (132 )   (72 )   (291 )   —     (311 )   (370 )
Less: Equity investment     (3,225 )   —     —     —     —     (688 )   (298 )
   
 
 
 
 
 
 
 
Total Earnings:     (23,557 )   (301,044 )   (174,592 )   (112,445 )   (63,648 )   41,752     (13,199 )
Fixed Charges:                                            
Interest expense     68,303     100,700     132,137     79,629     40,047     46,691     52,085  
Estimated interest component of rent expense     5,937     6,741     5,970     3,165     1,603     4,300     4,605  
   
 
 
 
 
 
 
 
Total Fixed Charges   $ 74,240   $ 107,441   $ 138,107   $ 82,794   $ 41,650   $ 50,991   $ 56,690  
Ratio of earnings to fixed charges (1)      < 0     < 0     < 0     < 0     < 0     1.8188     0.7672  
(1)
The ratio of earnings to fixed charges is computed by dividing pre-tax income from continuing operations (before adjustment for minority interests in consolidated subsidiaries and loss from equity investees) plus fixed charges by fixed charges. Fixed charges consist of interest charges, whether expensed or capitalized, and that portion of rental expense we believe to be representative of interest. For the years ended December 31, 2002, 2001, 2000, 1999 and 1998 and the nine months ended September 30, 2002, earnings were insufficient to cover fixed charges by $23.6 million, $301.0 million, $174.6 million, $112.4 million, $63.6 million and $13.2 million, respectively.


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COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (IN THOUSANDS)

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EXHIBIT 23.1


INDEPENDENT AUDITORS' CONSENT

        We consent to the incorporation by reference in Amendment No. 2 to Registration Statement No. 333-110241 on Form S-3 of Primus Telecommunications Group, Incorporated and subsidiaries of our report dated February 27, 2003 (August 28, 2003 as to the effects of the adoption of Statement of Financial Accounting Standard (SFAS) No. 145 described in Note 2), which report expresses an unqualified opinion and includes an explanatory paragraph referring to the adoption of SFAS No. 142, "Goodwill and Other Intangible Assets," effective January 1, 2002, and SFAS No. 145, "Rescission of FASB Statements No. 4, 44, and 64, amendment of FASB Statement No. 13, and Technical Corrections," effective January 1, 2003, appearing in Primus Telecommunications Group, Incorporated's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on September 5, 2003. We also consent to the references to us under the headings "Selected Financial Data" and "Experts" in such Prospectus.

DELOITTE & TOUCHE LLP

McLean, Virginia
January 13, 2004

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INDEPENDENT AUDITORS' CONSENT

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Exhibit 25.1

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)

WACHOVIA BANK, NATIONAL ASSOCIATION
(Exact Name of Trustee as Specified in its Charter)

22-1147033
(I.R.S. Employer Identification No.)

301 S. COLLEGE STREET, CHARLOTTE, NORTH CAROLINA
(Address of Principal Executive Offices)

28288-0630
(Zip Code)

WACHOVIA BANK, NATIONAL ASSOCIATION
1021 EAST CARY STREET
RICHMOND, VA 23219
ATTENTION: CORPORATE TRUST ADMINISTRATION
(804) 697-7139
(Name, address and telephone number of Agent for Service)

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
(Exact Name of Obligor as Specified in its Charter)

DELAWARE
State or other jurisdiction of Incorporation or Organization)

54-1708481
(I.R.S. Employer Identification No.)

JAMES CENTER II
1021 EAST CARY STREET, BOX 2350
RICHMOND, VIRGINIA
(Address of Principal Executive Offices)

23219-2350
(Zip Code)

% SENIOR DEBT SECURITIES DUE
(Title of Indenture Securities)

1.     General information.

Furnish the following information as to the trustee:

a)
Name and address of each examining or supervisory authority to which it is subject:
b)
Whether it is authorized to exercise corporate trust powers.

        Yes.

2.     Affiliations with obligor.

        If the obligor is an affiliate of the trustee, describe each such affiliation.

        None.

3.     Voting securities of the trustee.

        Furnish the following information as to each class of voting securities of the trustee:

        Not applicable—see answer to Item 13.

4.     Trusteeships under other indentures.

        If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, furnish the following information:

        Not applicable—see answer to Item 13.

5.     Interlocking directorates and similar relationships with the obligor or underwriters.

        If the trustee or any of the directors or executive officers of the trustee is a director, officer, partner, employee, appointee, or representative of the obligor or of any underwriter for the obligor, identify each such person having any such connection and state the nature of each such connection.

        Not applicable—see answer to Item 13.

6.     Voting securities of the trustee owned by the obligor or its officials.

        Furnish the following information as to the voting securities of the trustee owned beneficially by the obligor and each director, partner, and executive officer of the obligor:

        Not applicable—see answer to Item 13.

7.     Voting securities of the trustee owned by underwriters or their officials.

        Furnish the following information as to the voting securities of the trustee owned beneficially by each underwriter for the obligor and each director, partner, and executive officer of each such underwriter:

        Not applicable—see answer to Item 13.


8.     Securities of the obligor owned or held by the trustee.

        Furnish the following information as to securities of the obligor owned beneficially or held as collateral security for obligations in default by the trustee:

        Not applicable—see answer to Item 13.

9.     Securities of underwriters owned or held by the trustee.

        If the trustee owns beneficially or holds as collateral security for obligations in default any securities of an underwriter for the obligor, furnish the following information as to each class of securities of such underwriter any of which are so owned or held by the trustee:

        Not applicable—see answer to Item 13.

10.   Ownership or holdings by the trustee of voting securities of certain affiliates or security holders of the obligor.

        If the trustee owns beneficially or holds as collateral security for obligations in default voting securities of a person who, to the knowledge of the trustee (1) owns 10 percent or more of the voting stock of the obligor or (2) is an affiliate, other than a subsidiary, of the obligor, furnish the following information as to the voting securities of such person:

        Not applicable—see answer to Item 13.

11.   Ownership or holdings by the trustee of any securities of a person owning 50 percent or more of the voting securities of the obligor.

        If the trustee owns beneficially or holds as collateral security for obligations in default any securities of a person who, to the knowledge of the trustee, owns 50 percent or more of the voting securities of the obligor, furnish the following information as to each class of securities of such person any of which are so owned or held by the trustee:

        Not applicable—see answer to Item 13.

12.   Indebtedness of the obligor to the trustee.

        Except as noted in the instructions, if the obligor is indebted to the trustee, furnish the following information:

        Not applicable—see answer to Item 13.

13.   Defaults by the obligor.

        (a)   State whether there is or has been a default with respect to the securities under this indenture. Explain the nature of any such default.

        None.

        (b)   If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, or is trustee for more than one outstanding series of securities under the indenture, state whether there has been a default under any such indenture or series, identify the indenture or series affected, and explain the nature of any such default.

        None

14.   Affiliations with the underwriters.

        If any underwriter is an affiliate of the trustee, describe each such affiliation.

        Not applicable—see answer to Item 13.


15.   Foreign trustee.

        Identify the order or rule pursuant to which the trustee is authorized to act as sole trustee under indentures qualified or to be qualified under the Act.

        Not applicable—trustee is a national banking association organized under the laws of the United States.

16.   List of Exhibits.

        List below all exhibits filed as part of this statement of eligibility.

o   1.   Copy of Articles of Association of the trustee as now in effect*

o
 
2.
 
Copy of the Certificate of the Comptroller of the Currency dated March 27, 2002, evidencing the authority of the trustee to transact business*

o
 
3.
 
Copy of the Certification of Fiduciary Powers of the trustee by the Office of the Comptroller of the Currency dated March 27,2002*

o
 
4.
 
Copy of existing by-laws of the trustee**

o
 
5.
 
Copy of each indenture referred to in Item 4, if the obligor is in default.

 
 
 
 
—Not Applicable.

ý
 
6.
 
Consent of the trustee required by Section 321(b) of the Act.

ý
 
7.
 
Copy of report of condition of the trustee published pursuant to the requirements of its supervising authority

o
 
8.
 
Copy of any order pursuant to which the foreign trustee is authorized to act as sole trustee under indentures qualified or to be qualified under the Act.

 
 
 
 
—Not Applicable

o
 
9.
 
Consent to service of process required of foreign trustees pursuant to Rule 10a-4 under the Act.

 
 
 
 
—Not Applicable
*
Previously filed with the Securities and Exchange Commission on April 11, 2002 as an Exhibit to Form T-1 in connection with Registration Statement Number 333-86036.

**
Previously filed with the Securities and Exchange Commission on May 13, 2003 as an Exhibit to Form T-1 (in connection with Registration Statement File No. 333-105207) and is incorporated by reference herein.


SIGNATURE

        Pursuant to the requirements of the Trust Indenture Act of 1939,the trustee, Wachovia Bank, National Association, a national banking association organized and existing under the laws of the United States of America, has duly caused this Statement of Eligibility and Qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Richmond and the Commonwealth of Virginia, on the    th day of December, 2003.

    Wachovia Bank, National Association

 
 
By:
/s/ S. A. MCMAHON
S. A. McMahon
Vice President


Exhibit T-6

CONSENT OF THE TRUSTEE

        Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of 1939, and in connection with the proposed issue of Chesapeake Corporation Senior Debt Securities, Wachovia Bank, National Association, hereby consents that reports of examinations by Federal, State, Territorial or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefore.


 
WACHOVIA BANK, NATIONAL ASSOCIATION

 
By:
 
/s/ S. A. MCMAHON
 
     
 
      S. A. McMahon
Vice President		  

Richmond, Virginia

December    , 2003


Exhibit T-7

REPORT OF CONDITION

        Consolidating domestic and foreign subsidiaries of Wachovia Bank, N.A., at the close of business on September 30, 2003, published in response to call made by Comptroller of the Currency, under title 12, United States Code, Section 161. Charter Number 1 Comptroller of the Currency.

Statement of Resources and Liabilities

ASSETS

Thousand of Dollars

Cash and balance due from depository institutions:
 
 
  Noninterest-bearing balances and currency and coin   11,680,000
  Interest-bearing balances   748,000
Securities    
  Held-to-maturity securities (from Schedule RC-B, column A)   0
  Available-for-sale securities (from schedule RC-B, column D)   84,131,000
Federal funds sold and securities purchased under agreements to resell   0
Federal funds sold in domestic offices   517,000
Securities purchased under agreements to resell   4,731,000
Loans and lease financing receivables (from Schedule RC-C):    
  Loan and leases held for sale   10,595,000
  Loan and leases, net of unearned income   163,332,000
  LESS: Allowance for loan and lease losses   2,572,000
  LESS: Allocated transfer risk reserve   0
  Loans and leases, net of unearned income and allowance (item.4.b misus 4.c)   160,760,000
Trading assets (from Schedule RC-D)   27,857,000
Premises and fixed assets (including capitalized leases)   3,833,000
Other real estate owned (from Schedule RC-M)   153,000
Investment in unconsolidated subsidiaries and associated companies (from Schedule RC-M)   767,000
Customer's liability to this bank on acceptances outstanding   732,000
Intangible assets    
  Goodwill   9,504,000
Other intangible assets (from Schedule RC-M)   1,514,000
Other assets (from Schedule RC-F)   26,534,000
      Total assets   344,056,000

LIABILITIES
Deposits:    
  In domestic offices   194,540,000
    Noninterest-bearing   21,592,000
    Interest-bearing   172,948,000
  In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E, partII)   13,980,000
    Noninterest-bearing   33,000
    Interest-bearing   13,947,000
Federal funds purchased in domestic offices(2)   5,536,000
Securities sold under agreements to repurchase(3)   24,250,000
Trading liabilities(from Schedule RC-D)   19,430,000
Other borrowed money (includes mortgage indebtedness and obligations under Capitalized leases) (from Schedule RC-M)   30,910,000
Bank's liability on acceptances executed and outstanding   743,000
Subordinated notes and debentures.   8,549,000
Other liabilities   13,188,000
      Total liabilities   311,126,000
Minority Interest in consolidated subsidiaries   1,956,000

EQUITY CAPITAL
Perpetual preferred stock and related surplus   0
Common Stock   455,000
Surplus   24,178,000
Retained Earnings   4,696,000
Accumulated other comprehensive income   1,645,000
Other Equity Capital components   0
Total equity capital (sum of item 23 through 27)   30,974,000
Total liabilities and equity capital (sum of items 21,22, and 28   344,056,000


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SIGNATURE