PRODUCT DESCRIPTION

NetStream Enterprise is a discount and enhanced service package applicable to eligible digital services.

The NetStream Enterprise discount is based on the Customer's Committed Spend and the Contract Period. The Customer commits to a certain level of annual spend on the contributory elements of NetStream Enterprise Services for the Contract Period. This discount replaces all other discounts applied to the NetStream Enterprise Services (with the optional exception of services of 34Mbit/s or more) and it is applied to standard, un-discounted prices for NetStream Enterprise services.

ELIGIBILITY

Any Customer leasing Eligible Services (see below) qualifies for NetStream Enterprise.

Contributory Elements of Spend

Certain elements of the standard charges for the NetStream Enterprise Services will contribute to the Customer's Committed Spend (see the relevant sections of the BT Price List for details of specific prices). The NetStream Enterprise discount will only be applied to the contributory elements of spend on NetStream Enterprise Services, as indicated in the table below:

Eligible Services

The following services are eligible for NetStream Enterprise:

• - DealerStream 7 - 13
• - KiloStream and KiloStream N products
• - MegaStream 1, 2 and 8 (standard and Genus variants)
• - MegaStream services of 34mbit/s or more *
• - MegaStream Long Line Aggregate
• - KiloLine, KiloLine N and MegaLine products
• - KiloStream Assured Restore circuits
• - CitySure
• - CircuitSure
• - MegaStream Ethernet
• - LearningStream Ethernet
• - Prime Services **
• - IP Clear **
• - IP Converge **
• - Etherflow (Retail variant only) **
• - EES (SHDS) **

* Actual spend on Connection Charge and annual rental for BT Private Services of 34Mbit/s or more can contribute towards the NetStream Enterprise Committed Spend. However the Customer has the option to obtain either the NetStream Enterprise discount on these services, or select another appropriate tariff option.

** Actual spend on connection charges and annual rental for BT Prime Services can contribute towards the Committed Spend, but the services will not be eligible for the NetStream Enterprise discount.

DISCOUNT OVERVIEW

Customers signing a NetStream Enterprise Contract make a commitment to maintain a certain level of annual spend on NetStream Enterprise Services over the Contract Period. The level of Committed Spend and the Contract Period specified (from 12 months to 5 years) determine the level of discount received.

The discount is applied to standard un-discounted services for NetStream Enterprise services.

On entering NetStream Enterprise, the Customer specifies a `Committed Spend' and a `Contract Period', which define the discount tier. The Customer specifies which Services are to be included in the NetStream Enterprise Contract.

It is important that Customers set their Committed Spend at a level that they are confident is going to be achievable for the Contract Period.

DISCOUNT RATES and TIERS

DISCOUNT CONTRACT CONDITIONS

General Conditions

Customers' actual annual spend will be assessed against Committed Spend once a year, in accordance with the Customer's Billing Cycle. At that point, their actual spend is permitted to be up to 10% less than their Committed Spend. The `Contract Floor' is 90% of the Customer's Committed Spend.

If the Customer's actual annual spend is below the Contract Floor, then BT will charge the Customer 20% of the difference between the actual annual spend and their Contract Floor.

If the Customer believes that they will be unable to address the shortfall in Committed Spend for the remainder of their Contract Term, they will pay at least the first tranche of NetStream Enterprise Default Charges (as indicated above) but can then choose to split the contract into smaller contracts and terminate one or more of these (refer to `Splitting NetStream Enterprise Contracts' for details). This will reduce their commitment level, going forwards.

If the Customer's actual annual spend is more than their Committed Spend and qualifies the Customer for a higher discount tier, the Customer may either:

• -remain on their current tier, or
• -commit to a higher Committed Spend qualifying them for a higher discount tier from that point forward.

Customers may increase their Committed Spend throughout the Contract Period. But they cannot decrease their Committed Spend other than as described under `Migration Paths' or as outlined above.

NetStream Enterprise Contracts can be lengthened but not shortened.

Standard Contracts for the NetStream Enterprise Services remain applicable to the services as amended by the NetStream Enterprise Contract. For example, the 12 month minimum period for Private Services applies.

NetStream Enterprise Call-Off Option

As of 25th August 2004, the Call Off Option was no longer available for new provision and no new Call Off Options could be entered into, therefore there are no extant NetStream Enterprise Call Off Options.

Spread Connection Charges

There is no spread connection charge option available within NetStream Enterprise and Customers must pay any outstanding connection charges, before the NetStream Enterprise Contract commences.

Contract Extension

Extensions lengthen a Contract Period by moving the NetStream Enterprise End Date and may be requested at any point during the Contract Period but before it has expired.

The Customer may extend the Contract Period for any period. The discount rate to be applied forward from the date of extension is based on the total Contract Period measured from the Commencement Date to the new End Date, rounded down to the nearest year.

Extension Cashback, originally offered under this contract, ceased to be available from 25th August 2004.

Completion of the Contract Period

At the end of the Contract Period, unless the Customer has chosen to either extend the existing contract before it expires or has signed a new contract, circuit charges will revert to Standard Contracts and prices.

Termination of NetStream Enterprise Contract

If a Customer terminates the Contract before its End Date, they must pay a Contract termination charge of 20% of the Committed Spend that would otherwise have been payable for the remainder of the Contract Period.

On termination of the NetStream Enterprise Contract, NetStream Enterprise Services revert to Standard Contracts and prices. If the Customer then terminates any of these Standard Contracts, they must pay BT any charges associated with any applicable minimum periods of service.

MIGRATION PATHS AND MOVEMENTS BETWEEN CONTRACTS

Migration to NetStream Enterprise

Customers can ask to include additional Eligible Services into their NetStream Enterprise Contract at any time. If the Eligible Services to be included are on Standard Contracts of one year terms only, no changes to the NetStream Enterprise Contract are required. If the Eligible Services to be included are already committed to other BT discount contracts, migration may occur without the Customer incurring any discount contract termination or default charges, provided the following conditions are met:

Key conditions are:

• - All Eligible Services to be included in the NetStream Enterprise Contract will be reclassified as NetStream Enterprise Services and the NetStream Enterprise discount will replace all other discounts.
• - The outstanding Contract Period of the NetStream Enterprise Contract must at least equal the longest outstanding term of all the Contracts being included. This may necessitate an extension of the NetStream Enterprise Contract.
• - Discount rates for the restructured NetStream Enterprise Contract will be recalculated based on any revisions to the Contract Period and/or Committed Spend.
• - Any spend commitments made on the old contracts must be aggregated and the total value added to the NetStream Enterprise Committed Spend.
• - Volume commitments made on the old contracts must be converted to an equivalent level of spend, using the following per circuit rates. The total value is then added to the NetStream Enterprise Committed Spend:

Splitting NetStream Enterprise Contracts

A NetStream Enterprise Contract can be split into smaller NetStream Enterprise Contracts provided the commitments made under the original Contract are maintained or improved. To define the smaller Contracts, the Customer must split their NetStream Enterprise inventory into the required subsets. The Committed Spend can be split across the resultant smaller Contracts but cannot be reduced overall. The smaller Contracts will all have the same Commencement Date as the original Contract and must have either the same or a later End Date. Discount rates for the separate Contracts will be recalculated, based on the Committed Spend and the Contract Period set for each of the new smaller Contracts.

Migration from NetStream Enterprise to NetStream Corporate

When a Customer reaches the eligibility threshold for NetStream Corporate (see relevant Sub Part titled `NetStream Enterprise' within this Part), they have two choices:

• - Remain on NetStream Enterprise and retain current level of discount, or
• - Convert to NetStream Corporate by increasing their Committed Spend to reach or exceed the spend threshold for NetStream Corporate. From that point forward, they receive the additional discount and benefits of NetStream Corporate. The Customer's Contract End Date remains the same on conversion to NetStream Corporate.

If the Customer elects to migrate from NetStream Enterprise to NetStream Corporate, the Customer will be required to sign the NetStream Corporate Contract prior to such migration.

Migration From NetStream Enterprise to Partial Private Circuits (PPCs)

The window for migration to PPCs ended on 16th July 2003 and, thereafter, customers will be held to their contractual commitments except in the specific circumstances indicated below. The exceptions are:

For private circuits that were provided to a non-Schedule 2 Public Operator which was running a public telecommunications system under a Licence on or before 23rd December 2002 but which were subsequently provided to a Schedule 2 Public Operator in the period from 23rd December 2002 to 17th April 2003, the Schedule 2 Public Operator has until 16th July 2003 to formally notify BT of changes to be made to their NetStream Enterprise Contract(s) in relation to those circuits. If they do notify BT appropriately within this window, they will not incur Default charges or Early Termination charges on their NetStream Enterprise Contract(s), providing the `Conditions' specified below are met.

For private circuits that were provided to a non-Schedule 2 Public Operator which was running a public telecommunications system under a Licence on or before 23rd December 2002 but which were subsequently provided to a Schedule 2 Public Operator after 17th April 2003, the Schedule 2 Public Operator has 60 working days from the date on which they acquired those circuits in which to formally notify BT of changes to be made to their NetStream Enterprise Contract(s) in relation to those circuits. If they do notify BT appropriately within this window, they will not incur Default charges or Early Termination charges on their NetStream Enterprise Contract(s) providing the `Conditions' specified below are met.

For private circuits for which a corresponding PPC product is not available until after 17th April 2003, the Schedule 2 Public Operator has 60 working days from the date on which BT launches the corresponding PPC product in which to formally notify BT of changes to be made to their NetStream Enterprise Contract(s) in relation to those circuits. If they do notify BT appropriately within this window, they will not incur Default charges or Early Termination charges on their NetStream Enterprise Contract(s) providing the `Conditions' specified below are met.

Otherwise and for all other customers, appropriate charges will be raised as described in this Section.

Conditions:

• - The Customer provides an accurate inventory of all circuits to be converted.
• - For private circuits that were in the ownership of a non-Schedule 2 Public Operator which was running a public telecommunications system under a Licence on 23rd December 2002 but are provided to a Schedule 2 Public Operator after 17th April 2003, the inventory provided to BT by the Customer must include details of the date on which each circuit was acquired and include novation agreement documentation, if applicable.
• - Migrating circuits must be eligible for migration to PPCs.
• - Migrating circuits must be interconnection services conforming to definitions in the BT Wholesale PPC contract and any other relevant legislation or terms and conditions.
• - Migrating circuits must connect the system of a Schedule 2 Public Operator with the premises of a third party, who is the customer of that specific Schedule 2 Public Operator.
• - Any outstanding connection charges for the converting private circuits must be paid in full prior to Migration.
• - Customers must replace each Private Circuit converted with one PPC of equivalent bandwidth.
• - Customers reduce their Committed Spend by no more than the current year's net billable value after discounts (£s excluding VAT) of the Private Circuits converted to PPCs.
• - The NetStream Enterprise discount rate will be revised as appropriate to reflect the lower commitment level.

If any Customer makes a new volume and / or term commitment or increases an existing one under a NetStream Enterprise Contract (including any contracts taken over or any other changes to pre-existing contracts, made as a result of novation or similar process) on or after 23rd December 2002, they will be held to these commitments and appropriate charges will be raised as necessary, as described in this Section.

Migration From NetStream Enterprise to Other Contracts for BT Services

Customers can migrate from NetStream Enterprise to other contracts not specified above without incurring any discount contract termination or default charges, provided the following conditions are met:

• - A term contract must be in place or a new one must be signed (the `Receiving Contract').
• - The outstanding term of the Receiving Contract must be equal to, or greater than, the outstanding term of the pre-existing NetStream Enterprise Contract.
• - The Receiving Contract must take over immediately from the pre-existing NetStream Enterprise Contract, without a break. However, Customers must accept that there may be a short break in service between the cessation of the Private Circuits service and the start-up of the new service.
• - Annual net charges for the new services under the Receiving Contract must equal or exceed the Early Termination Charge for the NetStream Enterprise Contract.
• - Where the Customer has a pre-existing commitment on the Receiving Contract, the carry over of commitment, as outlined above, must be incremental to that pre-existing commitment.
• - On migration, all appropriate charges for the new service(s) must be paid.
• - Where the migration is partial (i.e. some Committed Spend is to be retained within the NetStream Enterprise Contract), the pre-existing NetStream Enterprise Contract must first be split and, thereafter, the private circuits (now in a separate contract) can be migrated to the Receiving Contract, on the basis indicated above.
• - Discount rates for the residual NetStream Enterprise Contract (the `Retained Contract') will be recalculated from the point of migration, based on the Committed Spend and Contract Period applying to the Retained Contract.

IMPACT OF NOVATION ON NETSTREAM ENTERPRISE AND BT PRIME SERVICE COMMITMENTS

A Novation Agreement will affect the spend commitments on BT Prime Services and NetStream Enterprise contracts in the way described below, dependent on the specific agreement reached between the Customer losing responsibility for the novated Private Circuits (`the Losing Customer') and the Customer gaining responsibility for the novated Private Circuits (`the Gaining Customer').

As BT Prime Service spend is contributory towards NetStream Enterprise Committed Spend, changes potentially affect commitment levels on both contracts.

These notes relate to changes in spend commitments but other amendments, such as the need to extend a contract end date, may also be required. Details can be found elsewhere in the Part.

Impact on the Gaining Customer

If the Losing Customer does not choose to decrease its BT Prime Service commitment in conjunction with the Novation, then the Gaining Customer is not required to change the level of spend commitment on their receiving contracts.

However, if the Losing Customer does seek to decrease its BT Prime Service commitment in conjunction with the Novation, the only way in which it can achieve this without incurring Default and/or Contract Termination charges, is if the Losing Customer agrees a position with the Gaining Customer, whereby the Gaining Customer takes on an incremental commitment commensurate with or greater than the Losing Customer's reduction. In that case, both Customers would need to restructure their contracts.

If any of the circumstances listed below applies, the Gaining Customer's NetStream Enterprise Committed Spend must be increased by no less than the reduction in the Losing Customer's BT Prime Service commitment.

• -The Gaining Customer has a pre-existing NetStream Enterprise contract and acquires a BT Prime Service commitment via Novation,
• -The Gaining Customer has a pre-existing Prime Services contract and no pre-existing NetStream Enterprise contract but is acquiring a NetStream Enterprise commitment via Novation,
• -The Gaining Customer has both a pre-existing NetStream Enterprise contract and a pre-existing BT Prime Service contract, to which an incremental BT Prime Services commitment and/or NetStream Enterprise commitment is acquired via Novation.

Impact on the Losing Customer

The Losing Customer's NetStream Enterprise Committed Spend can be reduced by up to, but no more than, the £s value of the novating BT Prime Service commitment, providing the Gaining Customer takes on a commensurate or greater incremental commitment.